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The US economy shrank at its fastest pace in nearly 27 years in the fourth quarter, government data showed on Friday, sinking deeper into a recession that the White House said demands urgent action.
Reuters
In a statement Wednesday, the Semiconductor and Electronics Industries of the Philippines said one of the hardest hit sector is the semiconductor and electronics industry, as global demand continues to slide.
Business Week
Many chip makers and analysts had predicted, as recently as earlier this month, that improvements in the semiconductor market could begin in the second half of 2009 as the chip inventories throughout the tech supply chain bottom and tech companies look to restock shelves with new products. But recent signs suggest a turnaround remains distant, and investors who have been piling into chip stocks could now be regretting their early advances.
CNNMoney
Retailers are slashing costs and in many cases shedding staff in a bid to protect profits in the economic downturn, but are walking a fine line as they seek to save money without damaging their brands and growth prospects.
Reuters UK
Asia's largest economies showed stark new evidence on Thursday of contagion from the global financial crisis as China reported its slowest growth in seven years and Japan's central bank admitted it faces two years of contraction and deflation.
The Financial Times
To combat the crisis, Chancellor Angela Merkel is buying stakes in banks and bailing out industries. Is there no limit?
Business Week
As the price of oil plunged from its peak last summer, solar and other forms of renewable energy became relatively less cost-competitive—dampening demand from industrial, commercial, and residential customers. At the same time, the credit squeeze has made it harder for customers, whether power companies or energy-conscious homeowners, to finance solar projects. Some also are holding back in anticipation that solar equipment prices will fall even further.
Business Week
China's economic growth slumped to 6.8% last quarter, dragging down the pace of expansion for all of 2008 to a seven-year low of 9% as the full force of the global financial crisis struck home.
CNNMoney
In the fourth quarter of 2008, venture capitalists raised only US$3.37 billion, down a staggering 71% from the year-ago quarter, according to a January 20 release by Thomson Reuters and the National Venture Capital Association. This is the smallest amount of money raised since the second quarter of 2004. The size of the average fund and the number of funds able to scare up capital is also rapidly shrinking.
Business Week
European Union finance ministers warned that they are running out of room to spend money to boost their economies, as Germany predicted its economy would shrink at least 2% this year and Hungary's currency fell to a record low despite recent efforts to prop it up.
Wall Street Journal
Singapore's economy may shrink a record 5% this year as exports slump, increasing pressure on the government to take steps to help businesses and consumers. The export-dependent nation has been battered by declining orders for electronics goods and pharmaceuticals from its biggest customers in the US and Europe, as well as emerging markets.
Bloomberg
The sleek racing machine that was the US economy is unlikely to return any time soon despite the huge repair efforts now underway. Instead, it probably will continue to sputter and threaten to stall for years to come.
LA Times
Speaking in Egypt, at a summit on the Gaza crisis, Mr Brown said he hoped the move would make it easier for firms and households to obtain credit. What the government wanted was to get "the resumption of lending" he added.
BBC News
In his usual no-nonsense manner, CEO TJ Rodgers described how he is navigating Cypress Semiconductor through bad economic conditions, and denied that the solar industry is losing competiveness as oil prices decline.
Semiconductor International
The deepening financial crisis, which is undermining the government's rescue efforts, is prompting federal officials to revisit the original bailout measures. "There's no doubt that we needed to stabilize the banking system," Obama told CNN's John King Friday.
CNNMoney
Helping capitalists out of a predicament of their own making is a delicate business, but any rescue mechanism should have built-in sanctions to raise risk awareness and reduce the probability of future crises. Banking regulators, central banks and governments should answer bankers' cries of help with a consistent and robustly capitalist approach.
The Financial Times
An economic stimulus bill being crafted by Democratic leaders in the US Congress and aides to President-elect Barack Obama will cost about $850 billion, according to a government source.
Reuters
Economic weakness continued to spread across the nation as real estate markets remained in distress and consumers kept their pocketbooks closed, according to the latest Federal Reserve report on regional economic conditions.
CNNMoney
Nearly 1,500 CEOs left their jobs last year, including 221 in the technology and telecommunications sector, according to Challenger, Gray & Christmas Inc.
Computerworld
Gartner is canceling two of its biggest technology conferences due to the economic downturn. "As a result of this review, we have decided to cancel this year's Spring Symposium/ITxpo in Las Vegas and Barcelona. While a number of factors influenced this decision, the primary reason for the change is the current macro economic environment and its anticipated impact on attendee travel and overall event attendance," Gartner said in the statement.
Computerworld
A severe economic slowdown in China is one of the biggest risks faced by the world this year, the World Economic Forum (WEF) has warned.
BBC News
More than half a million Americans lost their jobs in December, making 2008 the worst year for US employment since World War Two, while Europe's woes mounted as output from its factories plunged.
Reuters
History has shown that crisis breeds opportunity. Business leaders may have to cut costs to survive 2009, but the smart ones are also out there looking for prospects. If you have to cut costs, start at the top. If you can't give staff more money, look for ways to give them more power. In addition, innovating now can leave you nicely situated for a turnaround. For those who are willing to take some risks, 2009 can be a time of great possibilities.
Business Week
As the economy heads deeper into a recessionary abyss, business tax cut ideas that seemed to be nonstarters just a few short months ago are suddenly back on the table. Take the incoming Obama Administration's embrace of a measure that would lengthen the period for money-losing companies to write off net operating losses against profits from the current two years to four or five years.
Business Week
China faces surging protests and riots in 2009 as rising unemployment stokes discontent, a state-run magazine said in a blunt warning of the hazards to Communist Party control from a sharp economic downturn.
Reuters
Shares of chip makers and companies serving the sector suffered during the year. The Philadelphia Semiconductor Sector index, which is comprised of chip companies as well as manufacturers of chip-making equipment, fell by nearly half in 2008. The index closed Tuesday's trading session at 211.26, compared with 408.04 at the end of 2007.
Business Week
Chartered Semiconductor exemplifies the problems facing Singapore's ailing electronics sector after warning that it will suffer its biggest loss in nearly four years when it reports its results for the last quarter of 2008.
The Financial Times
South Korea's exports fell by more than 15% for a second straight month in December, adding to signs the economy is headed for its first recession since 1998. President Lee Myung Bak said South Korea will run an "economy-emergency government" this year to fight the worst economic crisis since its 1997 $57 billion bailout by the IMF.
Bloomberg
Factories in China and India joined much of Europe in slashing output and jobs at a record pace in December, another sign the biggest emerging markets were wilting under the recession gripping industrialized nations. "It feels like we've passed through the eye of the storm," Robert Rennie, chief currency strategist at Westpac in Sydney said of the financial crisis triggered by US bank failures last year.
Reuters
The US holiday shopping season is the worst since at least 1970 due to the recession, heavy discounting and harsh winter weather just before Christmas, the International Council of Shopping Centers said Tuesday.
CNNMoney
Fears of a prolonged recession in China have triggered a sharp increase in divorce inquiries addressed to lawyers and financial advisers, state media reported on Monday, with timing a key issue.
Reuters
Debt-laden Dutch chipmaker NXP Semiconductor will not go bankrupt, though some of its peers may fall by the wayside, its chief executive told a Dutch newspaper as the sector endures a crippling downturn. "This will keep us going for a very long time. NXP will not go bankrupt," he was quoted on Monday as saying.
Reuters
The British Chambers of Commerce (BCC) said it believed the minimum wage should not be increased until economic situations had significantly improved.
BBC News
The figures, from the retail data service of MasterCard Advisors, show the 2008 holiday shopping season was the weakest in decades, as U.S. consumers cut spending as they confront a yearlong recession, mounting job losses and tighter credit.
Reuters
Toshiba President Atsutoshi Nishida on Friday called on the government to prepare a safety net for unemployed workers as companies are forced to carry out aggressive layoffs to combat the economic storm. "Assuming a certain degree (of downturn) in business cycles, the government needs to prepare a safety net in terms of employment."
TradingMarkets
Asia is being hit by a financial tsunami that is not of its doing but which will hurt it all the same. Unlike the Asian crisis of 1997, which was caused by poor macroeconomic policies and weak financial systems in the region, this time most Asian countries are being affected despite strong macroeconomic fundamentals and sound banks and corporations. Regional growth will decline in 2008 and 2009 by as much as 2 to 3 percentage points, hurting many businesses and millions of people whose lost jobs will send them back into poverty.
Business Week
Here are some of the worst predictions that were made about 2008. Savor them—a crop like this doesn't come along every year.
Business Week
Governments should be ready to increase their spending on economic stimulus programs if circumstances require it, the International Monetary Fund's chief economist Olivier Blanchard said.
Reuters
When China offered 30 years ago to set up transport links with Taiwan, the island's government said no. As China's economy grew, Taiwan wavered. On December 15 ships, aircraft and mail at last began routine daily crossings directly across the Taiwan Strait. A jubilant Chinese official declared it "the final part of our economic circle with Taiwan."
Economist
A total of 29 countries, mostly developed markets, will experience economic contractions in 2009, according to the latest report by the Economist Intelligence Unit (EIU). The worst hit economy in Asia will be Taiwan, which will show a 2.9% contraction in real GDP growth next year.
The Edge Daily
14/15 pages