14/10/2008 - 07:00

Today's Business Headlines

14/10/2008 - 07:00

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Rudd's New Deal to beat world recession; ASIC sues KPMG over Westpoint audit; Fortescue flags iron ore prices to stay flat in 2009; BankWest buyer is confident over deal; Chinese steel cut worries Aussies

Today's Business Headlines

Rudd's New Deal to beat world recession
Kevin Rudd is poised to unleash billions of dollars in extra federal government spending, probably through tax cuts, pension increases and welfare handouts, in a bid to protect the Australian economy against looming global recession. The West

ASIC sues KPMG over Westpoint audit
The corporate regulator ASIC has launched a $200 million legal action against accounting firm KPMG over its auditing of companies in the Westpoint Group, which collapsed in early 2006 owing investors more than $300 million. The Fin Review

Fortescue flags iron ore prices to stay flat in 2009
Australia's third biggest iron ore producer Fortescue Metals Group has conceded that Pilbara producers may have to settle for a rollover of iron ore benchmark prices next year because of slowing Chinese demand. The West

BankWest buyer is confident over deal
Commonwealth Bank says its proposed $2.1 billion acquisition of BankWest should not be affected by any collapse in a proposed merger between the WA bank's parent, HBOS, and UK peer Lloyds TSB. The West

Chinese steel cut worries Aussies
Five Chinese steel mills have revealed plans to cut production by up to 20 per cent over October, as evidence emerges that real-economy stresses are being created in emerging markets by the Western credit crisis. The Australian

 

THE WEST AUSTRALIAN:

Page 1: Kevin Rudd is poised to unleash billions of dollars in extra federal government spending, probably through tax cuts, pension increases and welfare handouts, in a bid to protect the Australian economy against looming global recession.

The nation's corporate watchdog is suing global accounting giant KPMG for $200 million for negligence over its role as auditor of failed property developer Westpoint in a bid to recoup some of the savings and superannuation lost by thousands of investors.

Timber giant Gunns says its century-old sawmill at Yarloop is unviable and will be closed, blaming a lack of quality jarrah logs linked to the end of old-growth logging in 2001.

Page 4: Taxpayers could help pay to redevelop the privately run Perth Airport because it was taking too long to upgrade inadequate facilities, Colin Barnett said yesterday.

The state government could be exposed to legal action by businesses that were crippled by the Varanus Island explosion, Colin Barnett said yesterday.

Page 6: There is growing pressure of the federal government to delay an emissions trading scheme, with Woodside chief Don Voelte claiming the global financial chaos had to be rectified before it was possible for industry to sustain a carbon cost.

Page 7: The Reserve Bank is set to slash interest rates by 1.5 percentage points in the next seven weeks, financial markets believe, as further signs emerge of the malaise affecting the Australian economy.

Page 11: The mining union yesterday endorsed a four-hour stoppage on the Rio Tinto train line in the Pilbara on Friday as it moves to intensify its industrial campaign to win a unionised deal.

Page 14: Businesses using a lot of power would suffer if Western Power was allowed to double the cost it charges to supply electricity through its network, companies said yesterday.

Business: Australia's third biggest iron ore producer Fortescue Metals Group has conceded that Pilbara producers may have to settle for a rollover of iron ore benchmark prices next year because of slowing Chinese demand.

Resolute Mining chief executive Peter Sullivan has shrugged off the biggest bear market in decades to give his gold miner "a chance" of raising $51 million in a sharply discounted rights issue.

Commonwealth Bank says its proposed $2.1 billion acquisition of BankWest should not be affected by any collapse in a proposed merger between the WA bank's parent, HBOS, and UK peer Lloyds TSB.

A bumper day on the sharemarket was not enough to prevent Wesfarmers shares sagging another 2.4 per cent to a fresh five-and-a-half-year low yesterday ahead of today's crucial investor briefing in Sydney.

Rio Tinto's decision to push ahead with the underground expansion of its Argyle diamond mine in the Kimberley has received a boost after the project's director said yesterday first production was slated for December 2010, more than six months earlier than expected.

 

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: The Rudd government is considering using higher tax rebates and welfare payments to stimulate the Australian economy and keep it out of recession.

The world's big central banks have taken the unprecedented step of offering unlimited cash injections to ease the crisis crippling the global financial system, bolstering a range of dramatic initiatives by European governments to shore up ailing banks.

Australia's biggest cash management trust moved to switch its investments to government-backed assets last night after confusion over the application of the bank deposit guarantee to the $47 billion CMT sector.

Page 3: The corporate regulator ASIC has launched a $200 million legal action against accounting firm KPMG over its auditing of companies in the Westpoint Group, which collapsed in early 2006 owing investors more than $300 million.

James Hardie's former head of corporate affairs has denied he was responsible for a press release saying that an asbestos compensation fund was fully funded, when it was later found to have a $1.5 billion shortfall.

Page 5: West Australian Premier Colin Barnett has ordered his ministers to make urgent decisions on fast-tracking infrastructure projects and other economic developments, in a bid to insulate the state from the global financial crisis.

 

THE AUSTRALIAN:

Page 1: The Rudd government is planning a billion-dollar cash handout to consumers to help stave off a recession.

A rare spirit of bipartisan between the Prime Minister and the opposition leader over Australia's response to the financial crisis appears to have paid off for Kevin Rudd and Malcolm Turnbull.

Page 2: New opposition leader Malcolm Turnbull has burst out of the gates, while Prime Minister Kevin Rudd has reversed a drop in his satisfaction rating, according to the latest Newspoll.

Page 3: Accounting giant KPMG is being sued by the corporate watchdog over its role in the Westpoint collapse.

World: Republican presidential candidate John McCain is desperately trying to connect with US voters, as poll after poll shows him lagging behind opponent Barack Obama (Los Angeles).

Business: Investors have been told global economic crisis is a long way from over, despite a positive day on the Australian stock market yesterday.

Regulators will play a critical role in pricing the federal government's guarantee of between $800 billion and $900 billion in bank wholesale funding.

Five Chinese steel mills have revealed plans to cut production by up to 20 per cent over October, as evidence emerges that real-economy stresses are being created in emerging markets by the Western credit crisis.

Fortescue Metals Group has boosted its high profile with the appointment of mining identity Owen Hegarty to its board.

Oil prices are likely to continue to fall and petroleum producers will be forced to overhaul plans because of global financial volatility, Woodside boss Don Voelte has warned.

Aquila Resources has put talks with other parties on hold over potential asset sales or mergers until turmoil on global financial markets eases.

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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