Japan's Abe: I am Beating Deflation

Japanese Prime Minister Shinzo Abe says his country is winning the battle against deflation, the persistent low prices that have plagued Japan's economy for years. "This spring wages will increase, and higher wages will lead to greater consumption," he told business leaders at the World Economic Forum in Davos, Switzerland, on 22nd January, Wednesday. "It is not twilight but a new dawn that is breaking over Japan."

 

He also said he would take on vested interests and act "like a drill bit" to break down obstacles to restoring the country's competitiveness and doubling inward investment by 2020. His turnaround plan for the world's third largest economy -- dubbed Abenomics -- has included new spending pledges and an aggressive, expansive monetary policy. Progress on structural reforms to secure recovery for the aging and heavily-indebted country has been slower. But Abe said he would not let up with initiatives aimed at opening up markets, encouraging innovation and immigration, and transforming Japan's male-dominated corporate culture. "Japan must become a place where women shine," he said, repeating an earlier pledge to ensure 30% of senior positions will be occupied by women by 2020.

 

Abenomics has already had a big impact. Tokyo's benchmark index soared by nearly 57 per cent in 2013 -- its biggest annual rise in over 40 years -- as the yen tumbled against the dollar, helping exporters as Japanese goods became cheaper in foreign markets. Economic growth has also picked up, although a surprise slowdown in the third quarter of last year served as a warning that without major economic reforms, the early success could fade.

 

China's Yuan Climbs To World's 8th Most-Used Payment Currency 

China's yuan has become one of the world's 10 most-used currencies for payments, overtaking the Singapore dollar and Hong Kong dollar, global transaction services organisation SWIFT said on 23rd January, Thursday. In December, the Chinese currency was ranked 8th for payments, according to SWIFT. It said that over the past three years, the yuan had overtaken 22 currencies, and in December had a market share of 1.12 percent, behind the Swiss franc, with 1.29 percent.

 

Yuan payments increased 15 percent in December from November, while those for other currencies rose 7 percent, according to SWIFT. In October, the yuan overtook the euro to become the second-most used currency in trade finance. Among significant Asian currencies, only the yuan and the Korean won strengthened during 2013. The "redback" rose 2.8 percent against the U.S. dollar for the year, hitting record highs. Traders expect the yuan will appreciate by around 3 percent again in 2014, thoughChina's central bank has kept it on a tight leash so far this year. Beijing is stepping up efforts to make its currency an international one by accelerating reforms in domestic markets as well as introducing pilot programmes to allow freer yuan movements cross borders. Yuan trade settlement has expanded quickly since it first began in 2009. The percentage of China's trade settled in yuan rose to about 20 percent in November from 12 percent in 2012, according to the People's Bank of China.

 

Toyota Retains Number One Slot in Global Car Sales

Japan's Toyota has kept its position as the world's largest carmaker by sales. Toyota sold 9.98 million vehicles during 2013, which was 270,000 more than its closest rival - US car giant General Motors. Sales were up 2% from the year before and Toyota also announced plans to sell 10.32 million vehicles in 2014. Toyota has managed to revive its fortunes after the damage caused to Japanese industrial production by the 2011 tsunami. The tsunami and earthquake in 2011 caused widespread devastation in the north east of Japan and affected car suppliers and production.  Prior to 2008, when GM first relinquished the top spot to Toyota, the US firm had been the world's leader in car sales for more than 70 years. Toyota then led the way until 2011, when the disruption caused by the tsunami saw it slip to third place behind GM and Volkswagen. However, it regained the number one position in 2012.GM sold 9.71 million vehicles last year, while Germany's Volkswagen came in third with sales of 9.5 million. Toyota's sales growth has been strong internationally, especially its Lexus and Prius hybrid models, although it saw sales in its domestic market fall.

 

Eurozone Recovery Gathers Pace, Survey Says

The recovery among eurozone private sector firms gathered pace in January, a survey has indicated, with growth at its fastest pace since June 2011. The latest Markit Purchasing Managers’ Index (PMI) for the eurozone economy rose to 53.2 from 52.1 in December. A figure above 50 indicates expansion.

 

Growth accelerated in Germany while the rate of decline slowed in France. Separate figures from the Bank of Spain showed the country’s economy grew by 0.3% in the last three months of 2013. It was the second quarter of growth in a row for Spain, although the economy shrank by 1.2% over the year as a whole. Figures from Spain’s National Statistics Institute showed that the country’s unemployment rate edged up slightly to 26.03% in the fourth quarter of this year from 25.98% in the previous quarter.

 

Facebook's Sandberg is now a Billionaire

A record high close for Facebook shares has made Sheryl Sandberg one of the youngest female billionaires ever, according to a ranking from Bloomberg.

 

Sandberg, who is the company's chief operating officer, owns 12.3 million shares. That makes her stake worth about $720 million. In addition, she owns 4.7 million options, which would net her $220.6 million at her exercise price. She has also received stock awards which have not yet vested, the estimated value of which takes her over the $1 billion mark.

 

Female billionaires are still relatively rare. Bloomberg's list of the 200 richest peopleworldwide shows only 17 who are women. Forbes reported last year that there were 138 female billionaires worldwide, but that's out of a total 1,426 billionaires worldwide. And only 24 of the women billionaires on the Forbes list earned their wealth themselves; most inherited a significant portion of their fortune.

 

Sandberg joined Facebook in 2008 after working at Google. Before that she was the chief of staff to Lawrence Summers when he served as Treasury secretary in the Clinton administration. Fortune magazine ranked her as the fifth most powerful woman in business, and with 2012 earnings of $26.2 million, the third highest paid woman.

 

She also wrote a best-selling book last year, "Lean In." She serves on the board of Walt Disney  and was previously a director of Starbucks. But despite her accomplishments, the 44-year old Sandberg is not as wealthy as company founder and CEO Mark Zuckerberg. The 29-year old Zuckerberg owns 426.3 million Facebook shares, worth nearly $25 billion.

 

Swiss Central Bank Hard Hit by Gold Price Fall

Switzerland’s central bank lost billions in 2013 as gold prices plunged and therefore could not pay dividends to the Swiss cantons for the first time in more than a century. The Swiss National Bank (SNB) has been dishing out dividends to the Swiss cantons ever since its creation in 1907, and to the Swiss Confederation since 1991.

 

But the bank said neither would receive handouts this year, after provisional figures showed it would be reporting a loss of 9.0 billion Swiss francs ($9.9 billion, 7.3 billion euros) for 2013. It had lost far more on the value of its gold holdings, which shed 15 billion francs during a year when the price for the precious metal dropped by 28 percent. That deep loss was offset though by gains of 3.0 billion Swiss francs on the bank’s foreign currency positions, and another increase of 3.0 billion on a stabilisation fund it put in place in 2008 to save Switzerland’s largest bank, UBS, from collapse. But since SNB needed to put aside 3.0 billion Swiss francs as a provision for its currency reserves, it said it expected to end up about 12 billion francs in the red. “As this loss will be substantially larger than the 5.3 billion Swiss francs in the distribution reserve, the SNB cannot make a profit distribution,” the bank explained. The loss does not come as much of a surprise since SNB already said in October that the value of its gold holdings had shrunk by 10.7 billion francs during the first nine months of the year. But the news that the bank would not be padding state and cantonal coffers this year did come as a blow and sparked worries of looming budget deficits. 

 

Man Utd Pushed Out of Football Rich List Top Three

Manchester United has dropped out of the top three in Deloitte’s football rich list for the first time. Real Madrid, Barcelona and Bayern Munich were in the first three places in Deloitte’s list, which is based on revenues in the 2012-13 season. Real Madrid, with revenues of 518.9m euros (£444.7m), topped the list for the ninth year in a row, breaking a record previously held by Man Utd. French champions Paris Saint Germain took fifth spot in the table.

 

Despite falling down the pecking order, United’s revenues increased from 395.9 million euros to 423.8 million euros. The total combined revenue for the top 20 richest clubs rose 8 per cent to 5.4 billion euros, the report found. The list only looks at revenues accrued and does not take into account club debts.

 

Dan Jones, partner in Deloitte’s sports business group told that the increase in revenues was due largely to commercial sources, such as “sponsorships, shirts - everything that isn’t tickets and TV.” “Whilst Manchester United drop one place in the Money League, a number of the club’s recent commercial deals will boost revenue in 2013-14, so this fall to fourth place may only be temporary,” said Deloitte’s Austin Houlihan. “These deals, combined with the impact of the improved three-year Premier League broadcast deals from 2013-14, mean they are likely to get close to the 500 million-euro revenue mark in next year’s Money League. The Old Trafford club currently sits seventh in the Premier League, outside the Champions League qualification spots.

 

Other English clubs in the top 20 places were Manchester City (6th), Chelsea (7th), Arsenal (8th), Liverpool (12th) and Tottenham Hotspur (14th). Paris Saint Germain has seen its revenues almost quadruple to 398.8 million euros since 2010-11, and that figure includes commercial revenues of 254.7 million euros.The top 10 spots were completed by Italian giants Juventus and AC Milan.

 

Once again, the list was dominated by clubs from the so-called “Big Five” leagues; England’s Premier League, Germany’s Bundesliga, Italy’s Serie A, Spain’s La Liga, and France’s Ligue 1. However, as well as the two Turkish teams, Brazilian club Corinthians also made it into the top 30.