The Greek government is set to hold a second vote on Thursday on an austerity bill that forms part of the bailout deal with the IMF and ECB. Amid public protests Greece is expected to pass the bill which needs to be implemented to guarantee the next tranche of financial support. Greece’s Prime Minister George Papandreou on Wednesday won a vote on the outline of the austerity programmes, which includes tax cuts and privations of public assets, by 155 votes to 138. The measures to be passed through the final bill are said to total €28bn in savings by 2015, which are to help offset Greece’s deficit crisis.

Christine Lagarde, the French finance minister, was late on Tuesday elected as the first woman to head the IMF. Her victory was sealed after a late endorsement from the US which saw her beat Mexican central bank governor Agustin Carstens to the post. Lagarde, who succeeds Dominique Strauss Kahn following his resignation in May to deal with sexual assault allegations, is said to be facing tough challenges in the wake of the debt crisis surrounding several European nations. Immediately after her appointment Lagarde urged Greek ministers, who are due to vote on austerity measures worth €28.4bn on Wednesday, to unite so as to avoid default. The austerity package of taxes, spending cuts and sell-offs is critical for Greece to secure international aid from the ECB and IMF. “If I have one message tonight for Greece, it is to call on the Greek political opposition to support the party in power in a spirit of national unity,” she said.

TomTom, the Dutch navigation system maker, on Tuesday lost an estimated €325.7m in market value as investors responded to the company’s profit warning published on Monday. The company said in a statement that it expects profits to decrease by almost half in 2011 compared to the year before. The drop was attributed to a decline in personal navigation devices, particularly in the US. “Consumer electronics markets have been weak over recent weeks and this trend is ongoing. The size of the European PND market is broadly as anticipated and for the year as a whole is expected to decline by around 10 percent. The North American PND market is experiencing a faster rate of decline than earlier in the year and we now expect this market to be down by about 30 percent for the year as a whole,” the company said. It added: “As a result of these developments we now expect full year revenue of between €1,225m and €1,275m and earnings per share of between €0.25 and €0.30. Revenue for Q2 is expected to be between €300m and €310m.”

The IMF board’s 24 members are due to make a decision on who will be the next IMF managing director after the two key candidates had an opportunity to present all relevant information concerning their candidacy to the executive board.
 French finance minister Christine Lagarde remains a clear favourite for the top job as head of the IMF according to a Reuter’s poll despite a last minute endorsement on Friday by Canada and Australia for Mexico’s central bank head Agustin Carstens.
 In a published statement, representatives for the two countries, said: “It is important that the new IMF managing director is selected in an open, transparent process with the candidate chosen on the basis of merit and not nationality.”
Japan and the US have yet to publicly support a candidate but are widely expected to back Lagarde in her bid.

With financial reform legislation barely a year old, Republican policymakers, urged on by Wall Street’s influential figureheads, have been vehemently spinning the yarn of the Dodd Frank Wall Street Reform and Consumer Protection Act (DFA) into new regulatory fabric, trying to ignore the distraction of initiatives to tear up certain aspects of the existing law. They condemn DFA because a vast amount of the rules that put it into effect are yet to be written. Simultaneously they are trying to restrain the control, influence and power of the new Consumer Financial Protection Bureau so as to diminish DFA’s authorities by restraining funding and consequently ascertaining less rigorous rules on derivatives trading. When President Obama signed the DFA into law on July 21 2010, the event was proclaimed as the most comprehensive makeover of financial regulations since the Great Depression of the 1930s. Its 2,315 pages – 10 times longer than Glass Steagall – took around 18 months to produce and have attracted stern criticism from the start. The rules within the DFA call for more stringent liquidity and capital standards, quicker oversight, limitations on certain investments and greater accountability by rating agencies. However, anti-regulatory Republicans on the House Financial Services Committee are attempting to hinder implementation of several DFA rules which they maintain will hurt the US financial sector. Among those, the Volcker rule, which they believe eradicates proprietary trading by banks for their own accounts and restricts bank investments in hedge funds. The committee states that the law includes […]