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Saturday Papers: US drought threatens food price surge

And Manchester United's first day on the New York Stock Exchange got off to a flat start.

Saturday Papers: US drought threatens food price surge

Top stories

  • The Daily Telegraph: A drought in the US is causing corn price to soar, with fears mounting of damage to wheat crops; December corn futures traded on the Chicago Board of Trade rose as high as $8.3075 a bushel, a new record, before easing back.
  • The Guardian: Manchester United's first day on the New York Stock Exchange got off to a flat start as shares eked out a tiny gain in early trading before falling back to the slashed launch price.
  • Financial Times: Wall Street marked a fifth consecutive week of gains for the third time this year as the S&P 500 broke above 1,400 for the first time since May.
  • The Daily Telegraph: Standard Chartered is working on an eleventh-hour agreement with regulators in New York to avoid a potentially damaging showdown next week over Iranian transactions.
  • The Independent (Comment): Standard Chartered was no rogue bank. In fact, it might have been one of the financial institutions that were most helpful to the US Treasury here as America has ratcheted up financial pressure on Iran over the past decade.
  • The Daily Telegraph: IBM has made an informal approach to buy Research In Motion’s corporate email and BBM instant messaging software, widely regarded as the BlackBerry-maker’s “crown jewels”.
  • The Independent: Goldman Sachs was let off the hook yesterday as the US Department of Justice dropped plans to bring criminal charges over claims the bank was betting against the same toxic subprime mortgage securities it sold to clients.

Business and economics

  • The Daily Telegraph: Britain's recession might not be as deep as feared after better-than-expected construction data raised the chance that official GDP figures would be revised up; the Office for National Statistics said on Friday that construction output actually fell by 3.9% in the second quarter, instead of 5.2% assumed earlier.
  • Financial Times: The Consumer Financial Protection Bureau – a new agency created after the financial crisis - has proposed new rules on mortgage servicing that could prompt big banks to quit the business of collecting loan payments.
  • The Guardian: Facebook has agreed to tighten its privacy policies after it settled a long-running dispute with the US Federal Trade Commission (FTC).
  • Financial Times: Lonrho reported a 29.1% like-for-like jump in first-half revenues as new and retained contracts with US retailers lifted the Africa-focused conglomerate.
  • Financial Times: JC Penney, a US department store group, on Friday unveiled a 21.7% fall in like-for-like sales in the quarter to the end of July, worse than the 18.9% drop in the previous quarter.
  • The Daily Telegraph: Regional airline Flybe has hit turbulence once again, issuing its fifth profits warning since becoming a public company less than two years ago.
  • The Guardian: UK Coal has reported a £20 million first-half pre-tax loss and been forced to hatch a radical plan to try to pay off a £450 million hole in its pension pot.
  • The Daily Telegraph: Irish property developer Patrick McKillen has lost a High Court battle with Sir David and Sir Frederick Barclay over the ownership of three of London's most famous hotels.
  • The Daily Telegraph: Barclays' leading shareholders have backed the appointment of Sir David Walker as the bank's chairman, saying he is the right man to instigate a change of culture at the crisis-torn lender.
  • The Guardian: Panmure Gordon analyst Philip Dorgan has warned that online grocer Ocado is in significant danger of breaching its banking covenants this year, owing to a toxic cocktail of a "pile of debt and falling market share".
  • The Daily Telegraph: Guardian Media Group saw its operating losses more than double to £129.1 million last year despite vowing to cut costs.
  • The Daily Telegraph: The Bank of England will need to slash interest rates to 0.25% and print an extra £125 billion to lift the UK economy out of "continued stagnation," according to economists at Citigroup.
  • The Guardian: The US Treasury and the Federal Reserve were blindsided and angered by the decision of a New York banking regulator to launch an explosive attack on Standard Chartered over $250 billion in alleged money-laundering transactions tied to Iran, sources familiar with the situation said.
  • The Guardian: Prudential boss Tidjane Thiam indicated on Friday that the company would remain based in the UK despite fears that it might relocate to Asia because of new capital rules for European insurers.
  • Daily Express: Stamps commemorating the Queen’s Diamond Jubilee and autographs of Olympic sprinter Usain Bolt sent profits racing at Stanley Gibbons.

Share tips, comment and bids

  • The Daily Telegraph: Oil giant BP is to sell two processing plants and oil pipelines in Texas for $227.5 million.
  • Financial Times: Dixons Retail has moved to take near-full control of Pixmania, the French electricals website that has been hurt by poor trading in southern Europe.
  • The Daily Telegraph: Private equity veteran Jon Moulton has made an approach to JJB Sports and its bankers in an attempt to take control of the ailing high street retailer.
  • Financial Times: Aviva, the FTSE 100 insurer, has paid an estimated £100 million for a portfolio of solar rooftop systems in what it says is the largest residential renewables transaction ever seen in the UK.
  • The Daily Telegraph (Comment): It has been a tale of two insurers this week. Aviva announced numbers dominated by the costs of restructuring and the legacy of failure, while Prudential today announced numbers dominated by improving returns and the legacy of success.
  • The Independent (Comment): During a summer when we are celebrating the world's fastest, fittest and strongest, Barclays has chosen to pursue another superlative in its appointment of Sir David Walker as chairman: the oldest. After all, fixing Barclays — its business, culture and reputation — is not for the faint hearted.
  • Financial Times (Lex): Barclays – bye bye bling - the UK bank’s new chairman has a reputation as a fierce critic of bankers’ pay. How will the news go down on the bank’ trading floor?
  • Daily Mail (Comment): The revolving door at Britain’s biggest firms has never spun quite as fast as over the past few months. Out went Bob Diamond from Barclays, with chairman Marcus Agius close behind.

4 comments so far. Why not have your say?

Jeremy Bosk

Aug 11, 2012 at 09:09

Too late to profit from the American and Brazilian droughts, the news was on Reuters, Dow Jones and the FT months ago. Don't think you can switch from wheat, soya and maize to potatoes. The UK crop is smaller and more diseased than last year thanks to the torrential rain. Porridge?

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Chartered Accountant

Aug 11, 2012 at 10:41

Perhaps the impact of drought in the US might be mitigated if they cut back on the amount of US crops being converted into biomass fuel products.

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Aug 11, 2012 at 11:05

so the commodities dealers have a win/win situation. Grain and foodstuffs go up-- biomass fuel becomes more expensive to produce and crude is more in demand to cover bio mass shortfall. already around 1 in 5 UK households face food poverty as the result of all household increases, and stagnant wage levels. What do some other parts of the world look like ??

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Jeremy Bosk

Aug 11, 2012 at 14:05

There are plenty of biomass crops that are not food and will grow on land too poor for agriculture. Jatophra is one such. But America's leaders will continue to take the bribes. They calculate that the people faced with starvation are too poor to buy American goods and therefore too poor to matter.

Ironically, the millions of decent ordinary Americans give billions in food aid to fix the problem once it has occurred.

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