King's ransom
QE warning
The Bank of England governor Mervyn King has warned that the central bank is reaching the limit of its ability to prop up the UK economy through stimulus measures such as quantitative easing. The bank has ploughed £375bn into bond purchases, but Mr King warned that this is not "simply manna from heaven. There are no short-cuts to the necessary adjustment in our economy". He also suggested that banks need to accept that many loans written before the credit crunch will eventually default and would need to be written down.
Eurogloom
Depressed data
The latest manufacturing and service industry figures emanating from the eurozone suggest that economic conditions are worsening. Purchasing managers index figures for the eurozone worsened during October, falling to a 40-month low. Of most concern are signs that the malaise is spreading from the periphery to the eurozone engine of growth, Germany. Meanwhile, the sovereign debt crisis stumbles on, with Greece this week reportedly offered an extra two years in which to meet its deficit reduction targets, prolonging the painful austerity the country has to endure.
High life hobbled
Luxury hit
The latest blow to the luxury goods sector came this week with a profit warning from posh handbags maker Mulberry, which led investors to mark its shares down by more than a quarter on Tuesday morning. Mulberry was hit by slowing wholesale sales growth as well as a weakening in demand in the all-important Asia region which has driven the growth of luxury in recent years. At the same time, the company is investing heavily in its manufacturing and supply chain. Mulberry's warning came just a month after Burberry warned of a slowdown in its sales.
BAE fallout
Shareholders want blood
Influential shareholders at BAE Systems, including Invesco Perpetual's star fund manager Neil Woodford, are looking for scapegoats for the recent aborted merger with EADS. The shareholders are believed to have written to the board to demand that chairman Dick Olver and senior independent director Sir Peter Mason step down in a bid to help the company's reputation recover. Meanwhile, also in the defence industry, Chemring's chief executive has abruptly resigned in the middle of a takeover period.
See Defence cutbacks start claiming victims
Wellbeing warning
Still below par
The UK's national wellbeing index remains 13 per cent lower than the levels it occupied before the financial crisis of 2008-09, according to the Office for National Statistics. Indeed, Net National Income per head has fallen far more sharply than the more commonly used indicator of economic health - gross domestic product. The concern is that the slide has not yet been reversed or even begun to show signs of clawing back its deficit, something which happened within three years during the past two recessions.
Russia's richest
AAR windfall
The five oligarchs who owned half of the TNK-BP Russian oil partnership have sealed a deal with national oil company Rosneft for their 50 per cent stake in the business in the wake of BP's own cash and shares deal with Rosneft. The $28bn windfall has boosted the fortunes of all five men and catapulted Viktor Vekselberg to the top of Russia's rich list. His wealth, built up over a 20-year career since Russia began privatising its state companies, is estimated at $18bn after banking $1.5bn from the Rosneft deal.
