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	Thursday July  12th 2001
	
	
	
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[IMAGE]	[IMAGE]	[IMAGE]	[IMAGE]	Business this week
				July 12th 2001
				From The Economist print edition  
				
				
				Market jitters
				
				
				
				
				
				
				
				
				
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				Emerging markets were jittery. Argentina,s government bonds fell sharply as 
investors fretted about a default. The Brazilian real hit intra-day lows 
against the dollar in response. Turkey,s lira fell after the country failed 
to persuade the IMF to release its latest tranche of funds. The Polish zloty 
and Hungarian forint also weakened. Singapore slipped into recession and its 
dollar hit an 11-year low against America,s.
				
				See article: Gloom over the River Plate E+
				
				One cause of emerging economies, ills has been the strength of the dollar, 
which this week hit a 16-year high in real trade-weighted terms. The dollar,s 
rise came despite continued signs of weakness in the American economy. 
Unemployment in June rose to 4.5%.
				
				See article: The greenback's charm 
				
				The German Institute for Economic Research published the lowest-yet forecast 
for German economic growth in 2001: a sorry 1%.
				
				See article: No great harm, no good either 
				
				A meeting of G7 finance ministers concluded on a cheerful note. They stated 
hopefully that the world economy, particularly America,s, would improve soon.
				
				AT&T,s plans to break up into four separate units began with the spin-off of 
its wireless arm. However, the company,s low share price prompted Comcast, an 
American cable rival, to offer $44.5 billion for AT&T Broadband, which was to 
have been spun off later this year. The bid boosted AT&T,s shares; but the 
company said it would not sell.
				
				See article: Loop dreams E+
				
				Hold the Mayo
				
				
				
				
				
				
				
				
				
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				John Mayo was forced to resign only two weeks before he was to have become 
chief executive of Marconi ,after a profit warning by the beleaguered British 
telecoms-equipment company. Lord Simpson, the present chief executive, had 
been expected to become non-executive chairman but will remain in place for 
now. Big shareholders also want him to go soon.
				
				See article: Deputy heads will roll 
				
				The European Commission raided mobile-phone companies in Britain and Germany 
as part of an investigation into price-fixing on international charges in 
both countries. 
				
				Compaq Computer, the world,s second-biggest PC maker, gave a warning that 
profits in its latest quarter would be down sharply. America,s economic 
slowdown has intensified competition, and troubles have spread to Europe. A 
report from Merrill Lynch suggested further gloom; companies are spending 
less on IT and delaying upgrades.
				
				Microsoft is to allow PC makers more freedom to change the Windows desktop. 
The software giant,s move follows an appeals court ruling criticising its 
Windows monopoly; it may thereby hope to improve its negotiating position in 
settlement talks over the government,s antitrust suit.
				
				Baltimore Technologies, once one of the most admired Internet companies, shed 
its chief executive, Fran Rooney. The Irish Internet-security company, once 
worth o5.1 billion ($8 billion), suffered a mini-collapse of its ever 
dwindling share price that took its value to as low as o120m.
				
				Webvan, an American online grocer once valued at $8.7 billion, said that it 
would close with the loss of 2,000 jobs. The company had slowed its losses by 
abandoning extravagant expansion plans, but could not do enough to offset a 
rapid decline in orders.
				
				
				
				
				
				
				
				
				
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				Real Madrid paid a record euro77m ($66m) for Zinedine Zidane, a French 
international. The Spanish football club financed the deal and paid off debts 
by selling its training complex in Madrid,s business district.
				
				Opposite banks
				
				As expected, the British government blocked an o18 billion ($25 billion) bid 
by Lloyds TSB for Abbey National on competition grounds. This will, in 
effect, put an end to consolidation among Britain,s big banks; they may now 
seek targets abroad.
				
				See article: Ellwood Agonistes 
				
				CSFB, a Wall Street bank under regulatory investigation for its handling of 
initial public offerings, ousted its chief executive, Allen Wheat. He will be 
replaced by John Mack, former president of Morgan Stanley.
				
				Euronext, the outcome of a merger of bourses in Amsterdam, Brussels and 
Paris, made a poor showing on its own stockmarket debut. Its shares, traded 
on all three exchanges, fell by 8.5% on the first day despite being priced at 
the low end of the range. 
				
				Merrill Lynch, America,s largest stockbroker, sought to reassure sceptical 
customers of the impartiality of its analysts by stopping them owning shares 
in companies that they cover. 
				
				FTSE International, a British stockmarket indexer, launched FTSE4Good, a set 
of stockmarket indices for socially responsible investment. Many of Britain,s 
top companies failed to make the grade.
				
				See article: Best behaviour 
				
				
				
				
				
				 Science & Technology of the future 
				  
				 Visit Science & Technology, which features The Economist's prize-winning 
science articles.  Science & Technology also contains the contents of the 
latest Technology Quarterly (TQ) from The Economist.  This edition of TQ 
explores streaming video on the Internet, nanotechnology, gastrobots, gene 
sequencing and much more... .  
				
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