Today's other stories in brief
Bank chief criticises credit card rules
JP Morgan Chase chief executive Jamie Dimon yesterday hit out at strict new rules on US credit cards, saying they will cost the bank's lossmaking card unit up to $700 million (€495 million) next year.
His comments came after JP Morgan underlined its status as one of the winners from the crisis, beating analysts’ expectations with second-quarter earnings of $2.7 billion, up 36 per cent from a year ago, thanks to strong investment-banking revenues.
Mr Dimon said that, while JP Morgan supported most of the reforms introduced by the US government in the wake of the crisis, some of the “fast and furious” regulatory activity had gone “a little bit too far”.
He singled out the credit card provisions, which from February will constrain lenders’ ability to raise rates for risky borrowers, and new rules that propose to move most derivatives trading on to exchanges.
JP Morgan has already said the business is unlikely to be profitable in 2009 and 2010 as consumers continue to default. – (Copyright The Financial Times Limited 2009)
US recovery may start at year end
The US economy may pull out of a recession by the end of the year and a second stimulus package would help broaden the recovery, said Nouriel Roubini, the New York University professor who predicted the financial crisis. "The free fall of the economy has stopped," Mr Roubini said.
To help shore up growth, a second spending package may be needed by late 2009 or early 2010 totaling between $200 billion and $250 billion. – (Bloomberg)
Sharp drop in US jobless claims
The number of US workers filing new claims for jobless benefits fell sharply last week to the lowest level since January, but the data was distorted by an unusual pattern of car industry layoffs that amplified the drop.
Initial claims for state unemployment insurance fell 47,000 to a lower-than- expected seasonally adjusted 522,000 in the week to July 11th, the US labour department said yesterday. – (Reuters)
Bubble bursts for Remy Cointreau
Consumers are bypassing champagne in favour of cheaper sparkling wine, as Rémy Cointreau yesterday reported a 40 per cent fall in sales of its bubbly brands due to "difficult worldwide trading conditions".
France's second-largest spirits group attributed the fall to a drop in demand in France and at airports worldwide.
Champagne sales fell to €13.6 million in the three months to the end of June from €22.5 million in the second quarter last year. – (Copyright The Financial Times Limited 2009)
