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Goldman Sachs and JPMorgan Chase Co. have emerged two bellwethers of the US finance sector in the post-bailout Wall Street, leading the surge of optimism with their strong profits in the Y 2009 Q-2. Six major US banks have reported their second-quarter profits in the past two weeks, vastly beating analyst predictions. The business of Goldman has little to do with common consumers, its quarterly earnings of more than US$3.4B posted were buoyed by record results in its trading and underwriting business. According to the quarterly report, the Wall Street giant generated a record US$6.8B in revenue from fixed income, currency and commodities trading during the quarter. Revenue from equity underwriting jumped to US$736M form UD$ 48M in the first quarter compared with US$616M last year. JP Morgan Chase, the largest US bank by market value, posted a US$2.72B earnings, and made its profits mainly from investment-banking services including bond and equity trading, and underwriting debt to help companies issue shares and bonds, not commercial loans and consumption credit.

Popularity: 2% [?]

The world’s political and business leaders to meet more often to tackle the current economic problems

The world’s Political and Business leaders agreed at the Davos conference to come together more often to share the task of tackling the all the challenges of sinking consumer demand, to climate change.
Last weekend, the conference ended with no consensus on how to solve the world’s economic problems. The leaders are faced with a lack of confidence in western business, industry, and government, by people around the globe. In fact the it was reported in the Financial Times that the delegates “struggled to agree on a single answer to the crisis.”

It was reported that most executives agreed that more regulation was inevitable, but that the new regulations to be limited to, and designed to give business incentives to invest in the future and to stay focused on the consumer and on sustainable energy issues, and that more “collaboration” is necessary going forward.

Noting the theme of the 2008 forum: “The power of collaborative innovation”, contains much of what is required in theme of the 2009 forum, i.e. the shaping of the world, post financial crisis .
Lee McIntire, chief executive of CH2M Hill, an engineering and construction group, said: “Remember, we’re not always right at this conference. When I was here last year, what I kept thinking was, that if I could help my customers with water, energy and sustainability, I’d do really well profit-wise. . . The world has changed a lot since the last Davos forum.”

Trillions of US$s will have to be spent to bring confidence back into the system, thus bringing forth the question, where will this money come from?

Popularity: 11% [?]

Industry managers anticipate the performance of their businesses in a recession. The research shows us that during the 1990–91 and 2001–02 downturns the U.S. consumer prioritized spending instead of actually cutting it in all sectors. Consumer spending did drop in discretionary areas, i.e., dining out, personal care products, and charitable donations, but spending on groceries, reading materials, and other options that substitute for more expensive ones rose, as did spending on insurance, health care, and education. Most analysts do not believe that this world recession will last long time because the financial system is much stronger, and globally linked. The majority view is that the recovery will begin in Q-2/Q-3 2009 and will be well underway by Year End 2009. Note: the classic definition of recession as identified by the National Bureau of Economic Research is two consecutive periods of negative economic growth.

Popularity: 8% [?]