As the long-awaited report into the troubled emergency takeover of HBOS by Lloyds is published, we look back over the bank’s turbulent 14-year historyMay 2001 Halifax and Bank of Scotland merge to create HBOS, a “new force in banking”.January 2004 Mike Ellis, the then finance director, tells the board the Financial Services Authority (FSA) is concerned the bank is an “accident waiting to happen”. This subsequently emerges in the parliamentary commission on banking standards (PCBS) report in 2013.

Unfettered Osbornomics is what we’ll get on 25 November. If we had a financially literate opposition rather than Corbyn’s Labour, things might be differentThere were two oppositions in the last parliament: Labour and the Liberal Democrats. And, this week more than ever, it is worth saying that only the latter made any difference to the real lives of real people. Why? Because they were in government. But thanks to their brutal contraction and the subsequent departure of Don Corbyn de la Mancha for his knight-errant’s tour of windmills, we now have no effective opposition at all (unless you count the House of Lords). And this is about to matter in lots of painful ways to millions of people when the chancellor announces what cuts he plans to make in the spending review in his autumn statement on Wednesday.Related: George Osborne agrees 24% spending cuts with ministersRelated: These children of Thatcher are free to cut, cut, cut – and they’re loving every minute | Polly Toynbee Continue reading...

CBI’s snapshot of sector reveals strong pound and jitters over global growth are likely to dent factory outputUK manufacturers have reported the weakest overseas demand for their goods for almost three years as they grapple with a strong pound and a weaker global economy.The latest snapshot of factory order books and output from the CBI also showed companies expected output to fall over the coming three months – despite it having picked up in recent weeks, the business group reported.Related: UK manufacturers urge George Osborne to maintain spending on innovation Continue reading...

An important International Monetary Fund paper looks at how the eurozone should have responded to the problems that affected five of its membersBlanket austerity across the crisis-hit countries of the eurozone was self-defeating. Germany’s analysis of what needed to be done was wrong. The European Central Bank (ECB) was slow to come up with a stimulus package designed to offset the demand-sapping impact of wage cuts.Those were the main messages of an important International Monetary Fund (IMF) intervention into the debate about how the eurozone should have responded to the problems that affected five of its members – Greece, Ireland, Portugal, Spain and Italy. This quintet accounts for 30% of eurozone output.Related: Eurozone recovery loses steam as Germany slows Continue reading...

General secretary Frances O’Grady calls on George Osborne to ditch his planned cuts at next week’s spending reviewGeorge Osborne’s tax credit cuts will hit families in Britain’s poorest regions hardest, according to an analysis by the TUC.It is calling on the chancellor to ditch the plans in next week’s spending review.Related: The young will lose out, again, in George Osborne’s spending review | Tom Clark Continue reading...

French plan to boost security spending will not break fiscal rules, says Commission

A better educated workforce is also among the welcome findings in the International Labour Organisation’s latest data on the world’s labour marketThere has been a sharp drop in the number of working poor around the world, according to the International Labour Organisation (ILO), which has pulled that and some other welcome findings from its vast database on the global jobs market.The UN agency also highlighted a general improvement in the educational level of the world’s labour force as it released its latest key indicators of the labour market databases.Related: It’s a degree, not a ticket to a job | Kehinde Andrews Continue reading...

‘Gender lens investing’ aims to tackle the marginalization of women by asking investors to make gender equality part of the decision-making processBertha Nzabanita survived the 1994 genocide in Rwanda, but her husband did not. As a single mother, she struggled to make do with the one coffee field and dilapidated house he had left her. Then Nzabanita discovered Musasa, a coffee cooperative that gave her and other widows from the genocide a stable market for their coffee allowing them to increase their income.

Unlike headline inflation, the core measure of the cost of living actually rose in OctoberInflation has reached a trough, at least for now. The government’s preferred measure of the cost of living remained unchanged at -0.1% in the year to October, but will turn positive when the data for November is released next month.The reason is that the consumer prices index (CPI) fell by 0.3% in November 2014 as a result of the plunging cost of crude oil. Unless that decline is repeated this November – which it won’t be – the annual inflation rate will mechanically rise.Related: UK inflation remained negative at -0.1% in October Continue reading...

Reading stays below zero for second successive month as falling global commodity prices and strong pound weigh down rateInflation was negative for a second successive month in October, at -0.1%, according to official figures, leaving the cost of living for Britain’s households practically unchanged since January.The Office for National Statistics (ONS) said the rising cost of clothing - the biggest upward contribution to inflation - had been more than offset by declining food prices and the fading impact of costly student fees. It is the first time two successive monthly readings have been below zero since the consumer prices index (CPI) started to be calculated in 1996.Related: UK inflation is negative again, but what does this mean for consumers? Continue reading...

Research shows the automatic assumption of a better future for citizens in the west has now goneThe terrorist slaughter in Paris has once again brought into sharp relief the storm clouds gathering over the 21st century, dimming the bright promise for Europe and the west that the fall of communism opened up. Given dangers that seemingly grow by the day, it is worth pondering what we may be in for.Though prophecy is delusive, an agreed point of departure should be falling expectations. As Ipsos Mori’s Social Research Institute reports: “The assumption of an automatically better future for the next generation is gone in much of the west.” Continue reading...

Low inflation has mixed implications for households – it’s good news for borrowers but consumers with a lot of debts should try to pay them off

The market consensus concerning the dollar’s inevitable rise as US interest rates increase is almost certainly wrongThe US Federal Reserve is almost certain to start raising interest rates when the policy-setting Federal Open Markets Committee next meets, on 16 December. How worried should businesses, investors, and policymakers around the world be about the end of near-zero interest rates and the start of the first monetary-tightening cycle since 2004-2008?Janet Yellen, the Fed chair, has repeatedly said that the impending sequence of rate hikes will be much slower than previous monetary cycles, and predicts that it will end at a lower peak level. While central bankers cannot always be trusted when they make such promises, since their jobs often require them deliberately to mislead investors, there are good reasons to believe that the Fed’s commitment to “lower for longer” interest rates is sincere. Continue reading...

Companies and governments have got us all wrong – it’s impossible to predict what we want and care aboutConsumers today are often cast as god-like figures before whom markets and politicians bow. Everywhere, it seems, consumers are triumphant. Consumers drive production; they fuel innovation; they dictate modern politics; they have it in their power to save the environment or to destroy the planet.The word consumer describes people as having certain experiences and taking certain actions individually or collectively (similar to worker, employee, manager).

Investigations into financial crisis conduct show ‘no signs of abating’, warns Moody’sMajor banks have now set aside $219bn (£144bn) to pay fines and legal costs since the financial crisis.Ratings agency Moody’s, which calculated the vast provisions, ranked Barclays, HSBC and Royal Bank of Scotland at high risk from on-going investigations. Continue reading...

Amazon, Facebook and Google in line of fire after committee backs proposals to force multinational corporations to pay tax where they make their salesMEPs have launched a scathing attack on Facebook, Google and Amazon in the European parliament, accusing them of diverting profits worth billions of pounds to low tax havens.Members of the special committee on tax rulings said they were concerned that major US businesses were paying virtually no tax in the EU countries where they operated, denying governments vital funds. Continue reading...

Air France and Thomas Cook lead travel and leisure stocks lower amid concerns terror attacks will deter holidaymakersMore than €2bn (£1.4bn) was wiped off shares in European travel and hotel companies , as investors focused on concerns that the Paris attacks will hit tourism and consumer confidence across the continent.Shares in airline Air France-KLM, travel company Thomas Cook and their sector peers were down sharply on Monday, over fears the attacks and the prospect of tighter border controls would deter shoppers and holidaymakers from visiting Paris and other European cities. Continue reading...

All the day’s economic and financial news, as Paris investors refuse to panic after Friday’s attacks

Economics minister Akira Amari urges Japanese firms to use their record cash holdings to raise wages and increase capital spendingJapan’s recovery is being held back by a shortage of skilled labour, a leading minister has claimed, after the world’s third-largest economy entered its fourth technical recession in five years.Related: Japan 's 'quintuple dip' recession delivers a fresh blow to Abenomics Continue reading...

Consumer prices index (CPI) has been dragged down by tumbling global commodity prices and the effects of a strong poundThe UK’s inflation rate is expected to have remained in negative territory when official figures are released on Tuesday, leaving the Bank of England in little hurry to start raising interest rates.Economists expect data for October to show the inflation rate as measured by the consumer prices index (CPI) held at -0.1%, according to the consensus in a Reuters poll. Inflation has been at or close to zero for most of this year and first dipped into negative territory in April when prices fell for the first time in more than 50 years. Continue reading...

The investor-state dispute settlement puts companies’ rights ahead of human rights. Its effects are devastating for developing nations – we must abolish itWhen the architects of the international order that took shape after the second world war created the United Nations, they gave the organisation a lofty goal: “Save succeeding generations from the scourge of war.” Through the UN charter – akin to a world constitution – solemnly adopted in 1945 in San Francisco, they also said they were “determined to establish conditions under which justice and respect for the obligations arising from treaties and other sources of international law can be maintained”.Since then and in line with that vow, the UN has put on the world stage not only the Universal Declaration of Human Rights, but also legally binding instruments, including 10 core human rights conventions and countless declarations and resolutions.Related: The lies behind this transatlantic trade deal | George MonbiotThe ISDS cannot be reformed. It must be abolished Continue reading...

Global security concerns saw the euro hit a six-month low and stocks were sold off around the region as Japan entered a ‘quintuple dip’ recessionStock markets in Asia Pacific have fallen sharply in the wake of the Paris terror attacks and downbeat economic data.Leading the losers was the Nikkei index in Japan which tumbled nearly 1.3% as official figures showed that the country’s economy had entered recession for the fifth time in seven years.Related: Japan 's 'quintuple dip' recession delivers a fresh blow to Abenomics Continue reading...

The economy shrank for the second quarter in a row for the fifth time in seven years, figures showed, increasing the pressure on Shinzo AbeJapan has slid back into recession for the fifth time in seven years amid uncertainty about the state of the global economy, putting policymakers under growing pressure to deploy new stimulus measures to support a fragile recovery.Related: Abenomics 2.0 – PM updates plan to refresh Japanese economy Continue reading...

Corporate short-term thinking is holding back investment - governments need to step in nowTrillions of dollars, pounds, euros and yen are stuck in the global financial system with seemingly nowhere to go. Continue reading...

The sight of the PM complaining about cuts is remarkable. But it underlines how misguided the Tories’ appraisal is of the real threats to the economyYou could not make it up. Our ultra-smooth prime minister has complained to the Conservative leader of Oxfordshire county council about the cuts to local authority services being made in David Cameron’s constituency, which is itself in Oxfordshire. We owe this great story to the Oxford Mail, to which organ a certain exchange of letters, or possibly emails, was leaked.Welcome to the real world, Dave! When a prime minister finally wakes up to the consequences of the ideologically driven austerity policies of his own chancellor, then perhaps he should be tempted to follow the example of his hero, Harold Macmillan, and sack him. Continue reading...

The female-led Left Bloc party is about to form a government, but now faces shockingly sexist attacksA few days after Bloco de Esquerda (Left Bloc) won 10% of the vote in the Portuguese general elections last month, Joana Mortágua strode through the marble halls of the Portuguese parliament.Mortágua doesn’t resemble most deputies: she doesn’t wears suits, preferring a T-shirt and sneakers. She’s athletic and gathers her hair into a ponytail. Even after a historic result, she looked relaxed and amused, joking with colleagues that she had too many meetings to go to. Fast-forward a few weeks and her diary is fuller; Mortágua has become one of the most powerful politicians in the country. Continue reading...

As exporters feel the pinch, one analyst is suggesting that a surreptitious retreat from globalisation may be provoking the declineFor one Chinese company that depends on global trade, fears over the worldwide economy have come to pass already. “The global economy is pretty bleak at the moment,” says Luo Dong, the owner of Doyoung, a Beijing-based exporter of frozen seafood and fruit. “This is having a big effect on us. Our clients’ sales are a lot slower than they used to be, and as purchasing power overseas drops, our exports are taking a hit.”Luo’s observations were echoed on a wider stage last week, when the Paris-based Organisation for Economic Co-operation and Development voiced the fear gripping many economists: that the drop-off in trade, driven by China, may be a harbinger of something more worrying – a global recession. Continue reading...

Science, ethics and economics are intersecting to form a clear market signal: in the lead-up to the COP21 climate talks, responsible investors should divest from fossil fuels (Report, 13 November). At a time when the fossil fuel industry should be shifting its businesses to focus on renewable energy, it is doing the opposite, doubling down on coal, oil and gas. Capital continues to flow into the exploration and future extraction of dirty energy. Long-term investment decisions must take into account the externalities of a business model at odds with physical realities. In the lead-up to the COP21 climate talks, the financial community has a vital role to play in the transition to a new energy economy – one where fossil fuels must be left in the ground. From a fiduciary perspective, there are a number of indicators that fossil fuel investments contain significant levels of risk. The energy sector steadily shifted from high-return, low-cost conventional projects, to high-cost, capital-intensive, complex projects. Meanwhile, clean, carbon-free energy is rapidly becoming cost-competitive with dirty energy.Within the investor community, the early adopters have already begun a substantial movement to divest from fossil fuels, a movement representing $2.6tn in assets under management. The world’s largest institutional investors, including the Norwegian Sovereign Wealth and Rockefeller Brothers funds, have all expressed their concern for carbon-related investment risk and are adjusting their portfolios accordingly by moving out of fossil fuel holdings. Divestment also models the kind of commitments we are expecting to be taken from governments. We call on national governments to take effective commitments to end all form of subsidies to fossil fuels at the forthcoming G20.

Narendra Modi and David Cameron are playing politics in a globalised world

Dow falls more than 200 points over consumer spending and interest rate worries as observers say high rents may curtail shopping during the holiday seasonThe economy might be faring better this year, but that does not mean Americans will be going all out this holiday season, according to the latest economic data.US retail sales barely rose in October, thanks to lower-than-expected car sales, data released on Friday shows. Could this be a sign of gloomy sales ahead? It might be too early to say, but the news was enough to push US stock markets lower.Related: American wages remain at 1997 levels as recovery fails to lift middle class Continue reading...

Disappointment as Germany, France and Italy only post modest growth, while Portugal stagnates and Finland’s decline continues

UK Asset Resolution deal with Cerberus Capital Management is the largest financial asset sale by a European governmentThe government has agreed to sell a £13bn collection of former Northern Rock mortgages to a US private equity group.UK Asset Resolution (Ukar), the zombie bank created to run down the loans in Northern Rock and Bradford and Bingley, said it would sell the loan operation known as Granite as well as a further £1bn of Northern Rock loans to Cerberus Capital Management, which specialises in buying distressed debt. The deal is the biggest sale of financial assets by a European government, the Treasury said.Related: Northern Rock mortgages are latest gamble for US private equity firm CerberusRelated: If the Northern Rock fiasco was a morality tale, it was more about hubris than greed | Giles Fraser Continue reading...

French economy grows 0.3% in third quarter but Germany, Finland, Greece, Netherlands, Italy, and Portugal all undershoot market expectationsThe eurozone’s economy lost steam in the latest quarter as Portugal stalled, Germany slowed and debt-stricken Greece contracted.Gross domestic product (GDP) across the 19 countries in the single currency bloc rose just 0.3% in the third quarter, according to Eurostat. That defied expectations for growth to hold at 0.4%, according to a Reuters poll of economists. On a year earlier, GDP was up 1.6%, lower than forecasts for 1.7%.Euro area GDP +0.3% in Q3 2015, +1.6% compared with Q3 2014 #Eurostat - https://t.co/t83KcLWq89 pic.twitter.com/zwRG0uzVJh#Italy's GDP +0.2% in Q3, slightly below PMI signal. More sluggish growth signalled so far in Q4 pic.twitter.com/SEN038nZUmRelated: Eurozone GDP: Growth slows to just 0.3% - live updates Continue reading...

If chancellor wants government to ‘do more with less’ he must halt expensive projects, prioritise manifesto pledges and make cuts more sensibly, IFG saysThe government must use the forthcoming spending review to kill off some of its costly projects and to ditch unrealistic targets such as doubling UK exports if it wants to balance the books this decade, a report warns.The Institute for Government (IFG) thinktank raises concerns over ministers and civil servants’ ability to manage what will be an unprecedented decade of austerity as the chancellor, George Osborne, demands they “deliver more with less”.

Petrol bombs thrown at police in first strike against bailout-related tax increases and spending cuts since Syriza-led government came to powerClashes have broken out between riot police and protesters in central Athens during Greece’s first general strike since the leftist Syriza-led government came to power in January.Nearly 25,000 people participated in three separate demonstrations in the capital on Thursday, according to police figures, in protest at a further round of bailout-related tax increases and spending cuts. Another 10,000 marched without incident through the country’s second largest city, Thessaloniki.Related: New Alexis Tsipras-led Greek government takes powerRelated: Greece: the election is over, the economic crisis is not Continue reading...

Youths throw Molotov cocktails in Athens, as thousands protest against the ‘vicious cycle’ of austerity in Greece during the first general strike since Alexis Tsipras became PM

Riot police and protesters have clashed in Athens during the first general strike since the country’s left-led government came to power in January. Petrol bombs were thrown at police, who responded with tear gas and stun grenades. Thousands are protesting against the country’s ‘vicious cycle’ of austerity.

A single global central bank would fail spectacularly, but this does not absolve policymakers of their responsibilitiesToday’s world is more economically and financially integrated than at any time since the latter half of the nineteenth century. But policymaking – particularly central banking – remains anachronistically national and parochial. Isn’t it time to re-think the global monetary (non) system? In particular, wouldn’t a single global central bank and a world currency make more sense than our confusing, inefficient, and outdated assemblage of national monetary policies and currencies?Technology is now reaching the point where a common digital currency, enabled by near-universal mobile phone adoption, certainly makes this possible. And however farfetched a global currency may sound, recall that before the first world war, ditching the gold standard seemed equally implausible.

Greek workers take to the streets in Athens on Thursday as a general strike across the country brings public services to a halt. Demonstrators gather around Syntagma Square to protest against the ‘vicious cycle’ of austerity measures in Greece. This is the first general strike under Alexis Tsipras’s Syriza-led government Continue reading...

1,000 extra deaths and an additional 30-40,000 suicide attempts may have occurred after the economic downturn, according to researchDebt, austerity and unemployment have been cited as significant factors in the rising number of British men who have killed themselves since 2008, according to new research.Academics from the universities of Bristol, Manchester and Oxford estimate that an 1,000 extra deaths from suicide and an additional 30-40,000 suicide attempts may have occurred from 2008-2010 following the economic downturn, reversing previous trends in Britain where suicide rates among men were falling. Continue reading...

Struggles intensify as elections loom in February. But succession to Ayatollah Khamenei as leader appears to be at the centre of the in-fighting, says Gareth SmythIranian politics is entering a delicate and perhaps pivotal period. Factional struggles, always lively, have intensified since July’s nuclear agreement with world powers, while the reformists are also pushing gently to return to mainstream politics.

Prime minister Alexis Tsipras under pressure as services including schools, hospitals, and banks are hit by 24-hour walkoutGreece’s leftist-led government will get a taste of people power on Thursday when workers participate in a general strike that will be the first display of mass resistance to the neoliberal policies it has elected to pursue.The country is expected to be brought to a halt when employees in both the public and private sector down tools to protest against yet more spending cuts and tax rises. “The winter is going to be explosive and this will mark the beginning,” said Grigoris Kalomoiris, a leading member of the civil servants’ union Adedy.

Mark Carney tells audience ‘heads I win; tails you lose’ capitalism is coming to an end but more needs to be doneGeorge Osborne has said City fraudsters should receive the same treatment as shoplifters as he joined forces with the governor of the Bank of England, Mark Carney, to promise the public that the scandal-hit financial sector was being cleansed of wrongdoing.The chancellor said he understood the anger felt by voters towards bankers guilty of multimillion pound rip-offs and said they should be treated like other criminals if they broke the law.