Friday newspaper round-up: Bernanke, BP, Microsoft

29th Jan 2010 06:33

Ben Bernanke won a second term as Federal Reserve chairman following the closest-ever Senate vote for a US central bank head. The Senate voted 70-30 in favour of the 56-year-old economist's second four-year term at the helm of the Fed, despite accusations that Mr Bernanke's regulatory failures helped cause the financial crisis. The 30 no-votes made Mr Bernanke the least popular Fed chairman since the Senate started voting on the position almost 32 years ago, the Times reports. Carl-Henric Svanberg, BP's new chairman, has embarked on a boardroom shake-up at the oil group as it prepares to announce an expected 80% surge in quarterly profits to $4.7bn (£2.9bn) next week. The company's board met this week for the first time under the leadership of Mr Svanberg, who took up the role on January 1, to approve a replacement for Sir Tom McKillop, the former chairman of RBS who was forced to step down as a non-executive director of BP last year, the Times reports.Germany has triggered a near-panic flight from southern European debt markets by warning that there will be no EU bail-outs, even though it fears the region's economic crisis has turned dangerous and could prove "fatal" for the entire eurozone. The yield on 10-year Greek bonds blasted upwards by over 40 basis points to 7.15pc in a day of wild trading. Spreads over German Bunds reached almost four percentage points, by far the highest since Greece joined the euro, and close to levels that risk a self-feeding spiral. Contagion hit Portuguese, Spanish, Irish, and Italian bonds, the Telegraph reports.Meanwhile, the European Union made clear yesterday it would not abandon Greece and let Athens' mounting debt crisis jeopardise the eurozone, even as Germany and France played down suggestions they had already formulated an emergency rescue plan. "It's quite clear that economic policies are not just a matter of national concern but European concern," José Manuel Barroso, European Commission president, told reporters in Brussels, the Times reports.Cracks in global efforts at financial reform appeared to widen yesterday after Alistair Darling dismissed US plans to break up the banks as ineffective and missing the point. Interviewed ahead of a trip to the World Economic Forum in Davos, he also brushed aside fears about Britain's ability to sell gilts to fund the £178bn public debt after Bill Gross, managing director at Pimco, the world's biggest bond house, warned that they are "resting on a bed of nitroglycerine", the Telegraph reports.The Chancellor, Alistair Darling, meets some of the world's leading bankers for talks over breakfast today, as splits among the world's regulators over President Barack Obama's financial reform plan widen. Bob Diamond, the president of Barclays, Stephen Green, chief executive of HSBC, Peter Sands, his counterpart at Standard Chartered, and senior executives from Goldman Sachs, Morgan Stanley and Citigroup will meet Mr Darling privately, the Independent reports.The banks' stringent lending criteria are excluding hundreds of thousands of would-be first-time buyers from the housing ladder. The average deposit demanded from a first-time buyer has risen by 124% in two years, according to research from Hometrack, the property data group, the Times reports.Strong demand for Windows 7 helped second-quarter earnings at Microsoft soar 60%, in spite of a disappointing performance from its new online search engine. The world's largest software company said it sold more than 60m Windows 7 licences in the second quarter. Net profits at the company rose 60 per cent in the quarter to $6.7bn, or 74c per share, the FT reports.Standard & Poor's yesterday issued its most strongly worded comments yet on the state of Britain's economy and banking system, raising the prospect of a credit downgrade just before the general election. The loss of Britain's prized AAA rating would represent a serious blow to Gordon Brown in the lead-up to the vote and would almost certainly cause a run on the pound and a sharp increase in the cost of servicing Britain's enormous public-sector deficit, the Independent reports.