06/11/2008 - 06:45

Today's Business Headlines

06/11/2008 - 06:45

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Global crisis blows $40bn hole in budget; Warning of 9pc jobless rate; Banks' patience running out; Guarantee in need of tweaking; Chinalco regains hold on Rio blocking stake

Today's Business Headlines

Global crisis blows $40bn hole in budget
The Rudd government may be forced to axe major infrastructure projects and dump plans for tax reform after revealing the budget has a $40 billion revenue shortfall as a result of the global financial crisis. The West

Warning of 9pc jobless rate
Unemployment is expected to rise to 5.75 per cent by June 2010, but experts warn the government has underestimated the real rate of job losses the nation could face. The Australian

Banks' patience running out
The nation's banks are expected to sever the lifelines of more crippled companies, with the collapse of Allco Finance group and likely demise of ABC Learning Centres signalling the start of moves to clean up the mess created by the 15-month financial crisis. The Australian

Guarantee in need of tweaking
Commonwealth Bank of Australia chairman John Schubert yesterday called for a cap on the interest rates paid on deposits guaranteed by the federal government. The Fin Review

Chinalco regains hold on Rio blocking stake
Chinese aluminium giant Chinalco has regained control of its $10.4 billion stake in Rio Tinto which it hopes to use as a blocking stake against BHP Billiton's hostile bid. The West

 

THE WEST AUSTRALIAN:

Page 1: The Rudd government may be forced to axe major infrastructure projects and dump plans for tax reform after revealing the budget has a $40 billion revenue shortfall as a result of the global financial crisis.

The state government insisted yesterday there would be no changes to plans for the $1.8 billion Fiona Stanley Hospital despite growing speculation that Treasury wants it scaled back now that Royal Perth Hospital is to be kept open.

Page 5: Financial markets are predicting that official interest rates will fall another 1.5 percentage points within five months.

The man tipped to be China's next leader warned yesterday that the global financial crisis has slowed the Chinese economy but he was confident that its massive market of 1.3 billion consumers would see it escape the worst of the meltdown.

Australian officials are more pessimistic about the global economy than their overseas counterparts and fear the Chinese economy will slow faster than Sino officials are conceding.

Pilbara iron ore miners Brockman Resources and BC Iron have become the latest victims of the downturn in Chinese metals demand.

Page 10: Home building approvals in WA are at their lowest levels in six years after a 13.8 per cent fall in September compared with August.

Page 18: The Minerals Council of Australia has commissioned its own analysis of emissions trading to take into account limited action by big polluters amid criticism of federal treasury estimates.

Business: ABC Learning Centres was last night on the brink of collapse, with its board meeting to consider handing over handing over management of the company to insolvency firm Ferrier Hodgson.

Independent experts have urged Grange Resources' shareholders to approve the company's reverse takeover by Australian Bulk Minerals or risk its flagship $1.6 billion Southdown iron ore project failing amid uncertain credit markets.

The oil group ExxonMobil is once again the global leader with a market value of $556 billion.

Chinese aluminium giant Chinalco has regained control of its $10.4 billion stake in Rio Tinto which it hopes to use as a blocking stake against BHP Billiton's hostile bid.

Incremental Petroleum has effectively urged shareholders to reject Texan oil man Malone Mitchell's $84 million cash takeover offer after admitting the bid was "inadequate".

Mirvac has slashed its earnings estimate by almost 50 per cent as poor consumer confidence savages residential home sales.

The slowing advertising market has finally caught up with West Australian Newspapers Holdings, with the publisher yesterday revealing a sharp fall in ads as the global financial crisis tightens its grip.

 

THE AUSTRALIAN FINANCIAL REVIEW:

Page 1: The Rudd government is to reshape its reform agenda following a $40 billion collapse in revenue as the global financial crisis threatens to tip the economy into recession.

Barack Obama has swept to a landslide election victory, pledging to tackle the US economic crisis and usher in a new era of American leadership abroad.

Page 3: Commonwealth Bank of Australia chairman John Schubert yesterday called for a cap on the interest rates paid on deposits guaranteed by the federal government.

Page 6: The forecast for the 2008-09 budget surplus has been slashed from $21.7 billion to just $5.4 billion as tax receipts slump, and Treasury has forecast only small surpluses for each year to 2011-12.

Page 7: The effects of the global economic slowdown on Australia's economy have sent official unemployment forecast higher amid fears this may still underestimate the loss of jobs.

Page 13: The West Australian Liberal government is "highly likely" to refer its remaining industrial relations powers to the commonwealth, in a blow to federal Labor's vision for a seamless national workplace system.

 

THE AUSTRALIAN:

Page 1: President-elect Barack Obama will move quickly to put his stamp on a new administration, announcing over the next few days key White House posts as well as leading cabinet positions after he declared "a new dawn of American leadership".

Page 2: Unemployment is expected to rise to 5.75 per cent by June 2010, but experts warn the government has underestimated the real rate of job losses the nation could face.

Australian airlines under renewed pressure to reduce fuel surcharges.

Page 3: Future tax cuts, major road and rail projects are on the chopping block as the world financial crisis strips $40 billion from Rudd government revenue.

PhD's teaching position at university scrapped in wake of global financial crisis. Wayne Swan appears awkward. Nation's most prestigious suburbs sustain falls in house values.

Government's retail deposit guarantee having a "perverse" effect. Falling interest rates could save home borrowers thousands.

Business: The nation's banks are expected to sever the lifelines of more crippled companies, with the collapse of Allco Finance group and likely demise of ABC Learning Centres signalling the start of moves to clean up the mess created by the 15-month financial crisis.

Mirvac Group has halved its earnings forecast after successfully raising half a billion dollars in cash to inject into a business that has seen its security price dive more than 75 per cent since May.

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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