US gets tough on ratings agencies

US credit rating agencies will face tighter supervision under new rules adopted by the US financial watchdog.

The Securities and Exchange Commission (SEC) said agencies must disclose more information on past ratings to help investors make informed judgements.

The agencies, which give firms ratings to determine how safe an investment they may be, have been criticised for their role in the financial crisis.

The dominant agency firms include Standard & Poor's, Moody's, and Fitch.

'Flash trading' moves

Head of the SEC, Mary Schapiro, said that investors' reliance on agency ratings "did not serve them well over the last several years".

Earlier this year, credit rating agencies admitted errors were made when assessing some of the financial instruments that have been blamed for the credit crunch.

The agencies have been accused of failing to spot the size and risk of the bad US housing debt that was resold around the world, causing multi-billion-pound losses.

They gave high ratings to sub-prime mortgage investment vehicles that later turned out to be incorrect.

The SEC also proposed rules to ban "flash trading" - the process where certain financial institutions gain access to trading information seconds before it is made public.

news.bbc.co.uk

Developer showcases new Halo game

Microsoft has shown off the full version of the long-awaited follow-up to the first person shooter, Halo 3, ahead of its launch on Tuesday.

The Halo series is one of the most popular video games of all time, selling millions of units worldwide.

Set prior to events in the last game, Halo 3: ODST allows gamers to take control of an elite human soldier fighting hordes of alien invaders.

Halo 3: ODST will be in the shops on global release 22 September.

Initially developed as a add-on to fill the gap between the big instalments of the game, it snowballed into a stand-alone game in its own right.

Piers Harding-Rolls - senior analyst with Screen Digest - told BBC News that the title was "very big" for publisher Microsoft and that previous versions had done "fantastically well".

"We expect it to sell well and the chart track data - which looks at what gamers intend to purchase - has Halo 3: ODST pretty high up," he said.

"The last version - Halo 3 - sold more than eight million copies worldwide, although it is difficult to say whether it will be as big as the last one," he added.

Set toward the end of this millennium, Halo 3: ODST - which stands for Orbital Drop Shock Troopers - sees the human race engaged in a life-or-death struggle with a coalition of alien races called The Covenant.

Speaking to BBC News, Alex Cutting, associate producer with Microsoft Games Studios, said players would notice a big difference from previous Halo titles.

"There is no Master Chief (the main character in previous Halo games), instead players are going to be more ordinary," he said.

There are a number of gameplay changes reflecting the fact players are now regular troopers, rather than the turbo-charged super-soldier Master Chief.

"This means they are going to take damage if they fall off buildings and aren't nearly as fast as Master Chief," said Mr Cutting.

The latest version of Halo has players in the role of regular soldiers.

Jon Hicks, editor of the UK's Official Xbox Magazine, told BBC News that the lack of Master Chief would not be a problem.

"There might be those who miss [him], but I'm expecting they'll be in the minority.

"Everything else is pure Halo - the weapons, the vehicles, the setting - and it's engineered into the existing world and storyline in a way that even the biggest fans will fully appreciate," he said.

Health check

Probably the most significant change is how characters' health is affected by events in the game.

While Master Chief regenerated health, providing he was not being shot at, the ODST squaddies have a limited supply, which can be topped up from only a few health packs scattered across the map.

The developers behind the Halo series, Bungie, have intentionally made the combat location - an African city called New Mombasa - a dark environment, so they have added a visor system that has night vision and identifies enemy troopers with a red outline.

As in previous versions, fallen enemy soldiers can be looted for weapons and ammo. It also sees the return of the silenced pistol that made its debut in the first Halo.

"The pistol is quite a throwback to the Halo 1 pistol, of which people were really big fans," said Mr Cutting.

The first in the series - Halo: Combat Evolved - was released on Xbox in 2001

The game is not just played through the eyes of a single ODST soldier. There are various items scattered throughout the game that belonged to fellow troopers.

Picking up the item will trigger a flashback, putting you in the combat boots of the lost teammate and allowing you to replay the events that lead up to the item being dropped.

"You find out what your team has been up to during the time you were unconscious after your crash landing on New Mombasa," said Mr Cutting.

Multiplayer

The developers have also added a new mode to multiplayer called Firefight.

Entirely co-operative, the game sees up to four players defending themselves from successive waves of alien attackers, with each group being progressively harder than the last.

"You have to constantly adjust your strategy and work as a team, otherwise you won't last long," said Mr Cutting.

"As a co-operative game, its basically a score game and your team is trying to get the highest score possible.

Teams' scores are logged on a tournament ladder on the Bungie website.

Mr Hicks said the new Firefight feature gave the game a new dimension, compared with previous titles.

"Fighting off endless waves of enemies has been around since Space Invaders and given some excellent updates in Gears of War 2 and Call of Duty: World at War, but this adds a much brighter and more varied element to Halo.

"You really feel like you're facing a genuine threat, rather than a simple onrushing horde."

Mr Cutting said that the developers were now focusing all their attention on the next instalment of the Halo franchise - Halo Reach - due for release late next year.

By Daniel Emery

Gold sales rise despite high prices

Gold prices may be scorching at an all-time high of Rs 16,000, but it has failed to keep away jewellery buyers from making purchases

Gold brings stability to portfolio Gold ETFs: Safer bet in crisis Investing in gold a safe bet Gold: A safe option

ahead of the festive and marriage seasons in anticipation that the rates may shoot up further.

"The retail sales as well as the bookings for the wedding season have gone up as people, who were holding back on expectations of fall in prices, started purchasing thinking it might go up further as the season progresses," Mumbai-based P M Shah Jewellers' Dinesh Jain told PTI.

According to Jain, there is great excitement in the market. People have been purchasing the precious metal even during the 'Shradhh', an inauspicious fortnight according to Hindu mythology, which will end tomorrow, he added.

The gold prices today ruled at Rs 15,944 per 10 grams in the domestic markets and in the global market it was at 1,022 dollars an ounce (28.34 grams).

All India Gems and Jewellery Association Chairman Ashok Minawala said, there is a change in mindset of people, who have shown their confidence in gold as an ornament as well as an investment option.
"In the first quarter of this year the jewellery sales have been slow, but since then the demand has picked up and is likely to remain positive till the rest of the financial year," he said.

Echoing his Minawala Surat-based Kushal Das Jewellers' Deepak Choksi said the current positive trend in gold jewellery sales is likely to continue till the end of wedding season, which is till March 2010.

He also pointed out that the current upbeat market mood would help recover some of the losses incurred last year. "We hope to recover last year's loss through robust business this seasons' business and swing into profit," he said.

This year there is lot of new jewellery purchases instead of recycling of old ones, "Which gives us hope that the high prices, which affected last year's sales, is not going to affect sales this season," Minawala said.
economictimes.indiatimes.com

Getting it off your chest

IN A country as fiercely patriotic as Vietnam, you would expect the government to cheer a plan by citizens to distribute T-shirts bearing nationalistic slogans. However, the T-shirts in question carried messages of hostility towards China, Vietnam’s biggest trading partner. Worse, their pedlars were popular and sometimes critical bloggers.

Two well-known bloggers and an online reporter have been detained after the police uncovered an apparent attempt to print T-shirts opposing Chinese investment in a controversial new bauxite-mining project in Vietnam’s Central Highlands and casting doubt on China’s claims to disputed islands in the South China Sea.

The trio, who had all written critically about Vietnam-China relations on the internet, were detained on suspicion of “abusing democratic freedoms” to undermine the state. By the middle of this week Bui Thanh Hieu, a blogger who used the pen name Nguoi Buon Gio (“Wind Trader”), and Pham Doan Trang, a journalist who works for VietnamNet, a news site, had been freed without charge after several days in detention. Nguyen Ngoc Nhu Quynh, who blogged as Me Nam (“Mother Mushroom”), was still in custody.

These are the latest arrests in a continuing crackdown against bloggers and journalists. Ahead of a congress of the ruling Communist Party in 2011, when the country’s top three political posts will be up for grabs, the government is keen to rein in more outspoken commentators. Last December it imposed new restrictions on bloggers, making it illegal for them to publish under a pseudonym or to write about politics. Policing these rules will be hard.

More than 21m people, a quarter of the population, use the internet, according to government figures. Estimates of the number producing blogs range from a low of 1m to as many as 4m. The vast majority are personal diarists, not sociopolitical activists, but the spectacular growth of blogs and the difficulty of regulating them make the government, used to exercising total control of the media, twitchy.

Bloggers who have found themselves in the dock include some who have exposed government corruption or made negative remarks about the former Soviet Union. But the government seems particularly anxious about criticism of China.

Many Vietnamese remain hostile to their northern neighbour, after 1,000 years of imperial domination and a bloody border war in 1979. But the country runs a large trade deficit with China and needs its investment more than ever. This explains the government’s eagerness to push ahead with the Chinese bauxite-mining project, despite widespread criticism from scientists and generals (as well as bloggers). They have questioned Chinese companies’ environmental records and expressed their fears for national security.

International press-freedom groups, which often rank Vietnam alongside China and Myanmar as among the riskiest countries for bloggers, have condemned the latest arrests. Foreign diplomats fear that the clampdown will harm the fight against corruption. The new rules may cow bloggers, and journalists may be too scared to cover anything even vaguely risky—the law is unclear about what they can and cannot report.

But not everyone is deterred. “They only ever go after the big fish,” says one young Hanoi blogger, who has also openly criticised China many times. Besides, he adds, the government may be shooting itself in the foot. When bloggers are arrested, their readership usually takes off.

www.economist.com

Growth in UK retail sales stalls

UK retail sales were unchanged in August compared with the previous month, casting doubt on the strength of the recovery in consumer spending.

Sales growth in July was also revised down, from 0.4% to 0.2%, the Office for National Statistics (ONS) said.

Food sales growth was more than offset by falls in clothing and footwear.

To add to the retail gloom, department store John Lewis announced a fall in profits and predicted tough trading conditions in the coming months.

Big falls

Retail sales rose by 1.3% in June, and analysts had been expecting a third straight month of growth to reinforce hopes that the UK was emerging from recession - as hinted by other data.

There were signs of growth in some sectors. August food sales rose by 0.7%, while non-store retailing - which includes internet, telephone and mail order shopping - and repair shops saw sales grow by 1.1%.

But this was not enough to offset bigger falls in other areas.

All non-food sectors, apart from household goods, suffered declines in sales. The worst hit were textile, clothing and footwear shops, where sales dipped 1.3%.

Department store John Lewis added to the downbeat retail outlook when it announced a 20% fall in profits for the first half of the year, and said it expected the coming months to be tough.

"We expect trading conditions for the remainder of 2009 , and into 2010, to continue to be difficult," said chairman Charlie Mayfield.

He forecast a "slow, drawn-out economic recovery."

Reflecting the growth the overall growth in food sales, however, the group did see stronger performance in its supermarket chain Waitrose.

'Cautious spending'

Earlier this month, figures from the British Retail Consortium (BRC) suggested that like-for-like retail sales - which do not include new stores - fell in August, by 0.1%.

"The official data confirms our own findings that the strong retail sales in June and July were not sustained," said BRC director general Stephen Robertson.

Analysts had been expecting sales to rise

"With unemployment rates at 14-year highs and predicted to increase into next year, most people are still very cautious about spending on expensive items - unless there are sufficient discounts."

Separately, a survey from business group, the CBI, found that orders for UK manufactured goods remained weak.

Of the 555 manufacturers surveyed, 8% said orders were above normal levels, while 56% said they were below normal.

Export orders were particularly low, despite the relative weakness of the pound, the CBI said.

news.bbc.co.uk

China and US in new trade dispute

China has launched an "anti-dumping and anti-subsidy" probe into imports of some US car products and chicken meat.

The Commerce Ministry said there were concerns the US imports had "dealt a blow to domestic industries".

It comes a day after the US imposed tariffs on Chinese tyre imports in order "to remedy a market disruption caused by a surge in tyre imports".

The case is the latest in a series of recent trade disputes between China and the US.

"In line with national laws and World Trade Organisation rules, the commerce ministry has started an anti-dumping and anti-subsidy examination of some imported US car products and chicken meat," the Chinese authorities said in a statement.

The US has a ccused China of keeping the yuan artificially high

China has called the tyre move by US President Barack Obama "protectionist".

The White House announced duties of an additional 35% on Chinese-made tyres for one year, followed by tariffs of 30% and 25% in the following two years.

While Washington has long accused China of trade protectionism, the US is also unhappy at the high volume of Chinese exports to America, accusing Beijing of deliberately keeping the yuan undervalued to make its exports artificially cheap.

The US trade deficit with China totalled $103bn (£63bn) in the first half of 2009, down 13% from the same period last year.

news.bbc.co.uk