Business Trends

Archive for July, 2009|Monthly archive page

The United States And China Battle For Africa’s Oil Trade Market

In Uncategorized on July 29, 2009 at 4:38 pm

usachinaThe battle between China and the United States over Africa’s oil and gas resources is becoming more and more intense,” says Patrick Morris, President and CEO of Gold Star Resources Corp., a Canadian-based energy resource company targeting ‘onshore’ energy resource opportunities in Liberia, Cote d’Ivoire and Ghana. The company recently signed a Letter-of-Intent with Bengal Bight Ghana Ltd. to acquire 100% interest in the hydrocarbon rights of Bengal’s 1,000 sq. km. Tiampoum mining concession in Cote d’Ivoire, near the border of Ghana. Gold Star also recently disclosed that it acquired International Resource Strategies Liberia Energy, Inc.

According to Morris, “The International Energy Agency now projects that China’s net oil imports will soar from 3.5 million barrels per day in 2006 to over 13 million barrels per day by 2030. China already receives 60% of Sudan’s oil exports. While the U.S. today is still the number one importer of Africa oil, China is quickly closing the gap and has already sped past Great Britain and France to emerge as Africa’s second largest trading partner. China’s industrial growth has made that nation the second largest consumer of oil worldwide. There’s no question that China is winning more and more of African oil as each month passes.”

Morris also pointed out that trade between Africa and China has grown about 30% in the past ten years. “Based on substantive government reports, trade between Africa and China will exceed $100 billion by 2010,” the Canadian oil executive predicted. “The United States and China will now be in an intense competitive race for the lion’s share of this trade market. Both nations will be pouring billions of dollars into rebuilding Africa’s infrastructure including transportation, medical and educational projects. These projects go hand-in-hand with the African oil scramble and will ultimately benefit the African people and their economy over the next 20 years. China is using the African oil and gas markets to rapidly surpass the United States from a geopolitical and economic standpoint.”

Global Oil & Gas Exploration

According to industry research firm IBISWorld, Africa and the Middle East are expected to account for about 34% of global oil and gas production in 2009, up from about 32% in 2004.

The oil and gas industry’s main products are crude oil and natural gas. Crude oil is expected to account for 67% of global output by value in 2009 and natural gas for the remaining 33%. The share accounted for by oil peaked at about 78% in 2008, reflecting the relatively strong growth in oil prices compared with gas prices.

To view IBISWorld’s full report on Global Oil & Gas Exploration and Production, click here.


Prospects For The U.S. Steel Industry

In Uncategorized on July 28, 2009 at 10:38 pm

steelThe U.S. Steel industry is beginning to stir interest as demand in the US has stabilized at a low level, and signs of sequential improvement are begining to emerge. On top of that, continued strong economic growth in China has lead to global steel production levels recovering faster to high levels.

Even Goldman Sachs  is jumping on the steel-bangwagon, citing faster-than-previously-expected global market recovery, and a leaner supply chain in the US. The firm upgraded U.S. Steel (NYSE: X) from Neutral to Buy with a $52 price target. SteelDynamics (Nasdaq: STLD) remains their top pick. Goldman also predicts China will become a net importer of American steel in 2010.

Recovery in auto and appliance demand has already started to show up in increased prices, extended order books, and rising demand for flat steel.

According to Los Angele-based IBISWorld, an industry research firm, the US market for steel is much larger than domestic production and, as a result, imports have been substantial. The local market was valued at about $151.6 billion in 2008, with imports amounting to about $43.5 billion. Exports were considerably smaller, at an estimated $17.5 billion.

The automotive and construction industries will remain key sources of demand for steel producers. Also, the construction industry is being viewed by steelmakers as a major growth market for steel, with new initiatives designed to increase the use of steel-framed housing over the next few years.

With China expected to continue to account for over 50% of the growth in steel consumption, IBISWorld  forecasts world steel consumption to increase at an annualized rate of 4.6% to 1840 million tons over the five years to 2014. Also fueling growth beyond the outlook period is India, whose consumption of steel is expected to rival China’s within the next 25 years.

Related Links: IBISWorld industry reports

Iron & Steel Manufacturing in the US
World Demand -Steel
Steel Structure Contractors in the US
Steel Rolling & Drawing in the US

Consumer Behavior Trends Sparked By Recession

In Consumer Trends, economy, Uncategorized on July 27, 2009 at 6:29 pm

Americans Spending Differently

According to Research and Markets, 90% of US consumers believe that they are currently living in a recession. This is indicative of an intensifying recessionary mindset influencing consumer behavior. Symptomatic of falling consumer confidence is the fact that more than one-in-three US consumers experienced a worsening financial situation, falling job security and falling confidence in the housing market in 2008-09.

The study shows that:

•56% of US consumers feel that their lifestyle has been impacted by the recession. Suddenly, they have been forced to re-evaluate their spending, including where they do their grocery shopping as well as their in-store choices.

•44% of US shoppers are frequent buyers of private label products. Many are now likely to consider private label products to be on a par, if not better than market leading brands across sectors.

•For 72% of US shoppers, lower prices have a high amount of influence over where people do their shopping. Nevertheless, the quality of products sold similar influence over their (changeable) grocery shopping destinations. This is symptomatic of the intensifying value-consciousness across FMCG product sectors.

Women More Likely To Pinch Pennies

Women are cutting back more on discretionary expenditures than men in poor economic times, according to a new survey conducted by Opinion Research Corporation. Of those who participated in the survey, 86 percent of women reported spending less on elective expenditures compared to 78 percent of men.

When asked specifically about the lifestyle changes that have been made in the past 12 months due to the current economic environment, those surveyed provided the following responses:

•58 percent of women are eating out less, compared to 48 percent of men
•54 percent of women are buying fewer clothes and shoes, compared to 40 percent of men
•48 percent of women are shopping more at discount stores, compared to 37 percent of men
•36 percent of women are cutting back on charitable giving, compared to 26 percent of men
•31 percent of women have cancelled or postponed vacations, compared to 22 percent of men
Additionally, the survey found that 22 percent of men reported making none of these lifestyle changes, compared to 14 percent of women.

“More and more women are now responsible for managing the family’s finances, and they are more cost-conscious as the economy tightens their purse strings,” said Paula DeLaurentis, managing director, strategic alliances, TD AMERITRADE. “As a result, women are cutting back on daily expenditures and luxuries now more than ever.”

The survey also revealed that the down economy has affected the lifestyles of people living in the Northeast during the past 12 months, more so than any other region in the United States, particularly the West.

Key findings include:

•52 percent of those surveyed from the Northeast have postponed a major purchase compared to 39 percent of those from the West.
•19 percent of those surveyed from the Northeast have postponed adding to the family, such as, pregnancy, adoption and foster children, compared to 7 percent of those from the West.
•50 percent of those surveyed from the Northeast are buying fewer clothes or shoes compared to 44 percent of those from the West.

Strain on Career and Relationships

The recession is also splitting up and straining more marriages and relationships in America than in eight other major nations, according to a global survey commissioned by ING DIRECT. More Americans also believe that they will have to work at least ten more years before retiring – more than any other surveyed country. Yet, Americans are the least likely to sacrifice things people in other leading nations are willing to give up like their cars and pets to save money.

Nearly three in ten Americans (29 percent) say the recession has “added stress to,” “strained,” or even “ruined” their marriage/relationship. American love lives have been the hardest hit compared to just 12 percent in Germany, 24 percent in France and 23 percent in Canada.

Americans are not just feeling the economic pressure at home; it appears to be affecting their retirement plans too. Forty percent of Americans say the current economic situation will cause them to retire at a later age. Of those Americans who said they will retire later, 34 percent think they will have to work ten or more years than originally planned.

“Whether it’s at home, in the boardroom or in the car showroom, people around the globe are affected by the recession,” said Arkadi Kuhlmann, President of ING DIRECT USA. “The long term benefit is that people are cutting costs, saving more money, and learning to build a financial buffer for their future. Clearly, some of these global trends need to become a habit.”

In general, people around the globe agree that food is the last thing they would sacrifice to save money, but no nation loves their vehicles and pets more than America. Interestingly, a recent report from market research firm IBISWorld indicates that despite the recession, families purchasing dogs and cats as pets has actually increased by 2.4 percent since last year.

When asked to name the last three things they would sacrifice to save money, 30 percent of Americans said their vehicle. Only Brits (30 percent) love their cars as much, while Italians (14 percent) and Spaniards (18 percent) are more willing to unload their vehicle. In the US, nearly a quarter of Americans (22 percent) put a high priority on pets compared to Canadians (17 percent), French (15 percent) and Italians (12 percent).

Other sociological savings trends from the study include:

Having a financial buffer in case of emergency is the most important saving goal

Austria – 53 percent
France – 43 percent
USA – 35 percent (#1 saving goal)


Retirement is the most important saving goal

USA – 16 percent (#3 saving goal)
UK – 6 percent
Italy – 2 percent

Avoid credit card purchases to save money

USA – 46 percent
Germany – 11 percent
Italy – 17 percent

Cooking at home, bringing lunch to work to save money

USA – 51 percent
Canada – 44 percent
Italy – 20 percent

 The online survey was commissioned by ING DIRECT and conducted by TNS in nine countries where ING DIRECT operates, including Australia, Canada, United States, United Kingdom, France, Germany, Italy, Spain and Austria. In the United States, the survey took place between May 26 – June 9, 2009 among 1,052 adults age 18+.


For Research and Market’s full report, “The Global Economic Crisis: The Impact On Consumer Attitudes & Behaviors in the United States”, click here.

For IBISWorld’s full report, “Economic Crisis: When Will It End?”, click here.

Fixing America’s Broken Health-Care System

In Uncategorized on July 13, 2009 at 7:02 pm

With a growing number of patients unable to pay their medical bills due to the economic downturn, the fever for healthcare reform is running high in Washington, D.C., and politicians are lining up on both sides in offering solutions.  It’s clear that healthcare providers are facing a perfect storm that combines growing costs, declining revenues and industry reform. What’s also clear is that providers will need to become more innovative than ever in finding ways to boost economic efficiencies without lowering standards of care.

That aside, “Changes in medical technology will underpin growth in utilization of hospital care, contributing to rising overall U.S. health care spending”, said George van Horn, senior analyst at market research firm IBISWorld.

In a survey conducted by MedAssist, when asked which categories afford the greatest savings opportunities for hospitals, 29% of respondents pointed to improved technology (e.g., electronic health records, computerized physician order entry), while 26% mentioned preventative care and chronic disease management (e.g., asthma, diabetes). Survey participants also cited streamlining administrative costs and reimbursement contingent upon quality outcomes (both at 21%) as viable areas for cutting costs.

Outsourcing financial/revenue cycle services and implementing new IT programs – over cutting fixed cost – is considered as being one of the best strategies to reduce hospitals’ administrative costs.

Policy makers are already overlooking  many of the key opportunities in addressing what is really broken about the system. Some key considerations  in implementing an efficient health-care system include the following:

1. Restore Competition in the Marketplace

The four largest carriers in the country have 99% of providers in the network and in most states, the #1 carrier has 60-70% market share. In any other industry, this would raise antitrust issues, but for healthcare, no one seems concerned.  Solution?  Break up the BUCA monopoly (Blue Cross Blue Shield, United Healthcare, CIGNA and Aetna) and restore competition to the marketplace.

2. Enable the American Consumer to Become an Astute Buyer of Quality Healthcare

The key to cost control is to bring transparency to pricing. For example, a California patient who needs a chest X-ray is charged anywhere from $120 to $1,519; in fact within a few blocks in Sacramento the price climbs from $451 to $790 from one hospital to the next. The solution – every provider must disclose the net prices that they charge and consumers need to know how to find high-quality care.

3. Eliminate Hidden Revenue Streams

Do away with fragmentation in the healthcare delivery system, and instead, all Pharmacy Benefit Managers must fully disclose all sources of revenue or profit, block doctors from owning the diagnostic machines they refer their patients to, ban trips, money and other incentives from drug companies to doctors and force hospitals to disclose profitability and markup to implant devices.

4. Our Health – NOT Healthcare – Crisis

The nation is hysterical over 18,000 cases of Swine Flu, yet we have 100 million obese people in this country. The current administration should create an aggressive public campaign to promote a healthy lifestyle, restore funding for physical education in schools, as well as institute the use of prevention-based healthcare.

5. Facilitate Administrative Efficiency

Real savings can be realized by ensuring that the government define a standard for claims submissions between providers and payors, drive a set of rules for dealing with pended claims that makes sense, among others.

6. Protect the Risk Pool

The only way to make universal coverage work is to make sure it’s universal. The first step – mandate that all employers offer insurance or force them to contribute to a government fund. In addition, we need to limit coverage to basic minimums set nationally, and to ensure that everyone can afford coverage; we should require carriers to pool risk above a certain amount per claimant.

Strategies in Combatting the Foreclosure Crisis

In Uncategorized on July 13, 2009 at 5:12 pm

The long-term effects of the foreclosure crisis are only now sinking in for many communities, as homes languish unattended and property values plummet across entire neighborhoods. But a new report from PolicyLink report, Reclaiming Foreclosed Properties for Community Benefit, is showing how some cities and states are dealing with this second wave of the foreclosure tsunami.

With more than five million mortgages in some stage of foreclosure and more than 15 million Americans “underwater” with homes worth less than they owe on their mortgage, the foreclosure crisis remains a very real threat to countless communities.

“As foreclosed properties fester, communities are reeling from blight, crime, and property value decline,” said Kalima Rose, a report co-author and the Director of the PolicyLink Center for Infrastructure Equity. “Thankfully, some proven strategies are showing communities how to reclaim their housing stock and get their cities back on track.”

With a July 17th deadline looming for cities and nonprofits to apply for nearly $2 billion in federal Neighborhood Stabilization Program funding, the information in the tool is needed now more than ever.

Creating Community Land Trusts

Land trusts have been very successful at securing vacant properties and ensuring they remain affordable for years to come. In Providence, RI, city and state leaders acquired foreclosed properties in two of the hardest-hit areas and put covenants on their sale to ensure they remain affordable for decades.

Marketing Foreclosed Homes and Offering Tax Incentives to Buyers

Some cities with still-functioning housing markets have been able to attract new buyers to foreclosed properties. Boston has a trolley ride to take potential buyers on a tour of foreclosed properties. Los Angeles has hired marketers to tout the benefits of buying a foreclosed home. And other cities are offering low-interest loans or tax incentives to attract buyers.

Increasing the Cost for Owning Vacant Foreclosed Properties

Owners of foreclosed properties are often large investors who are waiting for the market to turn around — and letting their properties fall into disrepair in the meantime. By imposing taxes or fines on properties that remain vacant for more than a year, cities and towns can change the incentive structure and make it easier to sell the property to someone who is willing to fix it and live in it.

Rehabbing or Demolishing Vacant Properties

In Cleveland, community leaders have started a six-neighborhood pilot program to identify properties that can be rehabbed and demolish ones that cannot. Getting new homeowners into salvageable properties and saving the upkeep and repair money on non-salvageable properties reduces the burden for local government. Other cities with excess housing stock and low demand are following suit.

U.S. Private Equity Fund-Raising Down 64% at Half-Year Point

In Uncategorized on July 8, 2009 at 5:41 pm

At the halfway point of 2009, private equity firms raised just over one-third the capital they were able to attract from pension funds, university endowments, foundations and other investors in the first half of 2008. According to new analysis by Dow Jones Private Equity Analyst, the first six months of 2009 saw 173 private equity funds raise $54.9 billion, 64% less than the $152.7 billion raised by 261 funds during the first half of 2008 and the lowest mid-year total raised since 2005.

However, there are signs the fund-raising market may be thawing as the stock market stabilized somewhat in the second quarter and limited partners–institutions and firms that invest in private equity firms–gained a better grasp on the state of their balance sheets.

“Limited partners are still reeling from the extreme shrinkage of their assets under management since last fall,” said Jennifer Rossa, managing editor of Dow Jones Private Equity Analyst. “Many limited partners found themselves well over target allocations and unable to commit to the asset class while others chose to sit on the sidelines altogether or only committed to the best managers, even if they did have cash on hand. As a result, any private equity firm that could afford to delay raising a fund did and those that had to brave the market in the first half of the year faced tough conditions.”

In 2008, private equity firms raised a total of $287.5 billion, second only to the record $343.3 billion raised in 2007.

Buyout Funds Still the Big Draw Though the Funds Aren’t as Big

According to Dow Jones Private Equity Analyst, leveraged buyout (LBO) and corporate finance funds continue to attract the largest proportion of capital investment. In the first six months of 2009, 73 buyouts funds raised $28.7 billion, 72% less than the $102.6 billion raised by 98 similar funds during the same period last year.

Notably missing from this year’s fund listing are ‘mega’ funds, those with targets of $8 billion or more that were so popular during the private equity boom from 2006 to 2008 that many had to increase their sizes several times to accommodate investor demand. In 2009, just three funds reported investment goals over $8 billion and none had reached or surpassed their minimum targets by the halfway mark.

Secondary Funds Attract Bargain-Minded Investors

The difficult economy has many cash-strapped pension funds, endowments and foundations looking to sell their stakes in private equity funds. Secondary funds, which pool capital from investors to purchase existing stakes in private equity funds–often at a discount–have seen a big boost in investor interest.

According to Dow Jones Private Equity Analyst, 18 secondary funds have raised $13.9 billion in capital, setting a new annual record for the fund category with six months left in the year.

“It is clear that secondary fund managers are getting ready for some record deal-making,” said Ms. Rossa. “Once private equity firms start doing deals again, cash-conscious LPs are going to find it difficult to meet capital calls and will likely look to sell some of their private equity fund stakes to secondary buyers.”

Venture Industry Suffering Worst Year Since 2003

Compounding the recent news of decade-low deal activity and declining liquidity, the venture capital industry saw a 63% decline in fundraising in the first half of 2009. 

Market research firm IBISWorld‘s report on U.S. Venture Capital and Principal Trading shows that industry revenue fell by 60% last year.

“It’s venture capitalists that have experienced the biggest drop in revenue”, said George van Horn, senior analyst at IBISWorld.

Fifty-one venture funds raised $5.1 billion during this time compared to $13.6 billion raised by in 115 such funds in same period last year. This marks the worst first-half total for venture capital investment since 2003 when 34 funds raised $2.2 billion.
The first half of 2009 saw $1.3 billion invested in seven mezzanine funds, down 95% from the record total raised a year ago, and $5.9 billion put in 23 funds of funds, down 38%.
The largest fund closing of the first half of 2009 belongs to Hellman & Friedman. It raised $6 billion for its Hellman & Friedman Capital Partners VII LP buyout fund, which is still open with a$10-billion target.

China Losing Manufacturing Appeal as US Companies Turn to Mexico

In business opportunity, economy, Importing from China on July 7, 2009 at 5:32 pm

A new international bridge to Mexico is set to open October 2009 in the South Texas city of Mission, Texas. The Anzalduas International Bridge, a $168-million joint project between the United States and Mexico, will be one of the newest and largest border crossings in the country, and will directly connect Mission with Reynosa, Tamaulipas – a Mexican city known for advanced manufacturing and import/export operations.

Since the passing of NAFTA, Mexico has stepped up as a major competitor to China for cost-effective manufacturing. The main reason: lower transportation costs.

Compared to China and other manufacturing hubs, Mexico offers better access to the domestic and North American markets. A shorter, faster and cheaper transportation route to move products and supplies by truck, rather than over thousands of miles by ship, rail, and truck combined.

In South Texas, specifically the Mission metro area, eight international bridges connect the area with the industrial border communities of Reynosa, Matamoros and Monterrey, Mexico — some of the largest Mexican cities dealing with maquiladoras, importing/exporting goods, and vehicle traffic.

This relationship has made Mission and its sister cities an important industrial manufacturing corridor. Sharyland Business Park in Mission is in a Foreign Trade Zone (FTZ) – a “free port” allowing materials and finished goods to be imported or re-exported without payment of customs duties.

Area leaders have also been keen to other infrastructure planning on this side of the border. A new six-lane expressway now connects Mission with its sister cities. Interstate Highway I-69, another major artery of transportation, will soon connect trade routes from Mexico and Latin America to the United States and Canada. The Anzalduas Bridge will directly connect to I-69 – facilitating trade operations between the two countries.

“In the past, when the market softens in the U.S., we have always seen an increase in companies looking at our area as a way to reduce their costs and be more competitive,” said Pat Townsend, President of Mission Economic Development Authority.
This is evident in the number of companies that have visited the region. Companies like Black and Decker, Panasonic, and ALPS Automotive are attracted to the area for its low cost of living, career opportunities and location. Every day, more companies are finding and relocating here.

Health Care Reform Efforts Must Improve Nation’s Financial Outlook

In Uncategorized on July 6, 2009 at 6:16 pm

As Health Care becomes the latest hot topic with the President and Congress, The Concord Coalition’s Series – a nonpartisan, grassroots organization dedicated to balanced federal budgets & responsible fiscal policy – released the sixth installment of its series on Health Care and Medicare, entitled: Looking Beyond the Administration’s 10-Year Reserve Fund: Cost Control Must Do More Than Pay For Expanded Health Insurance Coverage

The new publication stresses that policymakers must emphasize controlling costs over the long-term rather than simply paying for an expansion of coverage.

While paying for any reform effort represents an important first step in avoiding further deterioration of the fiscal outlook, that action alone will not do the heavy lifting required to remedy the unsustainable track that health care spending is already on. Rather, tough choices concerning the underlying structural problems will be required.

The brief states:

Little will happen to contain the nation’s health care costs that doesn’t address the ill-managed proliferation of new technology and the propensities of the fee-for-service insurance structure to promote more services. More importantly, little substantive will happen until there is an acceptance all around — by the public, providers, insurers, and others in the health care industry — that sacrifice must be shared…Until the message is given and understood that all must yield something, it is hard to see how the parties will coalesce.”

What reform requires most of all, for the nation as a whole, is cost containment. Paying for expanded or universal health care requires more than balancing new expenditures with new revenues or other savings, whatever possible resources are identified and earmarked. It’s a commendable track relative to past efforts to expand health care benefits, which pushed much of the payment onto future generations. But it still avoids the larger question of how to manage the nation’s spiraling health care spending so that the whole system doesn’t implode some day. Policymakers cannot afford to lose track of that larger question even as they battle it out over the best way to pay for health care reform in the next 10 years.

According to market research firm IBISWorld, around 162 million people – 61% of the population under 65 years of age – receive health insurance coverage as part of employee benefit plans.

Stagnant Forecast for Financial Services Companies This Year

In Uncategorized on July 6, 2009 at 5:21 pm

financeThe majority of global financial services companies expect no return to growth until the first six months of 2010 or even later, according to the latest research conducted by Ernst & Young.

Market research firm IBISWorld also projects revenue growth to remain low, with activity revolving around changes to the industry this year. Industry revenue for 2008 came out to over $37 million, representing a 34 percent plunge.

As an indication of just how deep the recession is impacting the financial services sector, just over two thirds of those polled expect to increase the amount of time they spend on securing the future of their business.

The industry was clearly taken aback by the ferocity and depth of the downturn: 72% of respondents were surprised at the severity and 70% were surprised by the speed of the financial crisis. Only 30% had seen any improvement in their business over the last 12 months, compared to almost 50% that had not.

Tom McGrath, managing partner of Ernst & Young’s EMEIA financial services business, comments: “The end of the recession and a return to profitability is a tough one for any industry to call. But financial services are naturally more cautious – and possibly more realistic – about when the return to profitability might happen.”

The reorganization of the industry will be fundamental and it will vary by sector. However, managers are working hard to position their organizations to emerge stronger when the recovery comes – but there may well be some more casualties.”

Pennies being pinched, as profitability continues to decline

What is clear is the business-changing impact that the recession is having on the structure of financial services companies – and the toll it is taking on their bottom lines.
The majority (70%) of institutions have permanently changed their risk management strategy as a result of the crisis: 68% had implemented permanent differences to their regulatory framework and over half (54%) have changed their operating model. And it is easy to see why: almost six in ten financial institutions have seen their profitability decline and 56% have seen overall revenues decline in the same period.
If there is any silver lining, it is that 61% of respondents have had more opportunity to improve cost cutting in the last six months. Four in ten also plan to hive off their non-core or non-performing business, compared to five in ten in a similar survey earlier in the year.
Keith Pogson, managing partner for Ernst & Young’s financial services business in the Far East, said: “Fierce competition, volatility in the capital markets and business complexity are key concerns for any large enterprises, but they weigh more heavily on global financial institutions.”

Financial services clear on action from authorities

The sticky issue of pay and reward strongly divided respondents: 45% thought it needed more regulation while just under a third disagreed.


Financial services were also found to be broadly supportive of national and global initiatives aimed at stimulating the capital markets and easing the impact of the recession. However, only a third believed that their government should retain a stake in the financial services industry, with banking and insurance respondents the most skeptical suggesting that the time for bailouts may have come to an end.


Almost two thirds were inclined to agree that cooperation between international governments had played a central role in helping domestic and international economies in the last 12 months. Two thirds were supportive of their national governments economic policies in the past six months and half of the respondents believed their governments were powerful enough to solve their economy’s woes although a distinct minority (29%) felt they were ineffective in the face of the global recession.


Carmine DiSibio, managing partner for Ernst & Young’s Americas Financial Services Office, comments: “The financial services industry has been battered, but will certainly emerge from this recession stronger and healthier, with more focus on risk management. As the industry recovers, we are likely to see changes in operating models and regulatory frameworks. It’s likely to be a new world, and financial services firms will find their way together.”