Friday newspaper round-up: Stephen Roach, Imperial Tobacco, Gold

17th Feb 2012 07:01

Stephen Roach, one of Wall Street's most prominent economists, is retiring from Morgan Stanley, the bank he joined in 1982. Mr Roach has served as the non-executive chairman for Morgan Stanley Asia since 2010, having previously worked as chief economist. He will give lectures at Yale University. The 66-year-old is a noted analyst of the rise of China. He has been highly critical of the way that Western central bankers handled both the lead-up to the financial crash and its aftermath, and said they had "lost their way". In 2007, he predicted the US faced stagnation because of the likely impact of a housing crash. Mr Roach has recently argued that policymakers in Western nations need to think of ways of exiting from the extraordinary stimulus measures put in place during the credit crunch, including super-low interest rates, The Times explains.Car production in the UK hit a 16-month high last month in a boost to the ailing economy. The Society of Motor Manufacturers and Traders said 127,382 cars rolled off production lines around the country - 15.6% more than in January last year. The majority - 83.4%, or 106,189 - were exported amid booming demand for British-made cars overseas. But there was little cheer for workers at the Vauxhall plants in Ellesmere Port and Luton after the European arm of parent company General Motors plunged to a £444m annual loss. GM is looking to slash costs this year to bring it back into the black - putting thousands of jobs at its European operations at risk, The Daily Mail reports. Rumours of an imminent mega Footsie bid helped City dealers kick the tedious Greek bailout saga and the ongoing controversy about bank bonuses well and truly into touch. Lambert & Butler and Golden Virginia cigarette group Imperial Tobacco, the world's fourth-largest independent cigarette manufacturer, was puffed up to 2504p in heavy trading before closing 43p higher at 2492p on revived talk of a £35 a share break-up bid from Japan Tobacco, which controls over 66% of the cigarette market in Japan. It is now known to be on the trail of further acquisitions after its purchase of Gallaher Group in 2007. Imps recently reported a 7% decline in first-quarter cigarette sales and blamed a loss of distribution in Syria due to international sanctions, double-digit market declines in Spain as a result of a price war and trade loading effects around a price increase in the US, according to the Daily Mail. China will this year topple India as the world's biggest gold consumer, as demand for the metal as both a "safe haven" and to use for jewellery keeps growing, according to the World Gold Council. The industry body said 770 tonnes of gold were bought in China last year, 20% more than in 2010. That left the world's second biggest economy trailing only India, with 933 tonnes bought. Rising incomes in China mean that in addition to greater purchasing power for gold jewellery, people are increasingly turning to the precious metal as an investment, particularly given the weakness of the country's property sector. Worldwide demand for gold last year hit 4,067 tonnes, worth an estimated $205.5bn - the first time the figure has passed the $200bn mark. Investment buying drove the rise, with demand up 5% on the previous year, The Telegraph says. Insiders said Lucas Papademos was scrambling to meet Brussels' demands for austerity even as the latest data pointed to Greece missing yet more debt-reduction targets. Officials said that Eurozone finance ministers had been given a report showing Greece's public debt was on track to fall to just 129% of GDP, far short of the 120% target agreed under the €130bn (£108bn) second bail-out package. With concerns mounting about Greece's ability to deliver its promises, the European Central Bank (ECB) sought to protect €50bn of its Greek debt portfolio by swapping old bonds for new ones while Europe's leaders reportedly demanded fresh spending controls. One condition of a new bail-out is now expected to be that Greece permanently sets aside enough money to pay its debts for at least nine months, to prevent a repeat of the latest last-minute dash to avoid a default, The Telegraph writes.The owners of food retailer Iceland have confirmed they are in exclusive talks to sell the chain to a management team led by the company's founder, Malcolm Walker. It has also emerged Mr Walker and the management team are working with financial backers including Landmark Group, the Dubai-based owners of restaurant chain Carluccio's and South African group Brait. As The Daily Telegraph revealed on Thursday, Mr Walker has also got the backing of Lord Kirkham of DFS. The extra cash provided by the backers has allowed Mr Walker to raise his bid from the original £1.25bn. The higher bid allowed Mr Walker to trump rival offers from private equity groups Bain and BC Partners. Mr Walker's team has also secured the backing of Deutsche Bank for senior debt of about £700m, and Blackstone's debt arm, GSO, for roughly £200m, The Telegraph says. Tesco was accused of exploiting the jobless yesterday after advertising for unpaid nightshift workers. A vacancy appeared online for the 'permanent' role stating that the applicant would receive only Jobseekers' Allowance plus expenses. The role is one of hundreds of unpaid positions adopted by the supermarket as part of the Government's controversial 'workfare scheme'. The workfare program is designed to tackle the long-term unemployed by committing them to accept the offer of a job or work experience and providing financial incentives to employers. If jobseekers refuse to take part, they could lose benefit payments. But activists have accused Tesco of 'cashing in on misery' as the UK's unemployment rate soars, The Daily Mail reports.The crackdown on insider trading in the City intensified yesterday after a former senior Merrill Lynch broker was fined £350,000 for market abuse and another arrest was made in one of the Financial Services Authority's biggest enforcement cases. Andrew Osborne, 42, was accused by the FSA of improperly passing on market-sensitive information about Punch Taverns to David Einhorn, one of America's top hedge fund bosses. Mr Einhorn was last month fined £7m for his role in the incident. The fine came as the FSA said that it had made a ninth arrest in an unrelated enforcement case, almost two years after senior figures from Deutsche Bank, BNP Paribas and Moore Capital were detained in dawn raids on suspicion of participating in a sophisticated insider trading ring, The Times says.