The US Labor Department was to release yesterday a report that was expected to show the biggest monthly jobs loss in 26 years, piling more pressure on the Federal Reserve to slash rates again and adding urgency to an automaker bailout as the global economic crisis deepens.
After bolting to a 14-year high of 6.5 percent in October, the unemployment rate likely climbed to 6.8 percent last month, according to economists’ forecasts. If they are right, that would mark the worst showing in 15 years.
Skittish employers, which have slashed 1.2 million jobs this year alone, probably cut another 320,000 last month, economists forecast.
If that estimate is correct, it would represent the deepest cut to monthly payrolls since October 2001, when the economy was suffering through a recession following the Sept. 11 terrorist attacks.
Investors have been nervous about the fate of the cash-starved US auto industry, the failure of which would hit a chain of parts suppliers and financiers that spans the world.
“Concerns have spread that financial institutions, including Japanese ones, wouldn’t be able to escape unscathed if big US automakers were to go bankrupt,” said Tsuyoshi Segawa, an equity strategist at Shinko Securities in Tokyo. “We have no idea where and what could happen if a huge corporation like them failed.”
Other firms such as US phone company AT&T Inc, Swiss bank Credit Suisse and Japanese brokerage Nomura Holdings Inc were already cutting their work force by thousands, bracing for a long and hard global recession.
Ahead of the latest employment data, dealers priced in a three-in-five chance Fed would cut rates by 75 basis points to 0.25 percent on Dec. 16.
US Fed Chairman Ben Bernanke is exploring other economic revival options and wants the government to step up efforts to curb home foreclosures. Treasury Secretary Henry Paulson, the overseer of a US$700 billion financial bailout program, is also weighing new initiatives, even as his remaining days in office are numbered.
Central banks throughout Europe and Asia have slashed rates aggressively this week, with other more radical actions expected, as policymakers raced to stabilize financial markets and stop deflationary forces from getting further out of control.
The European Central Bank dropped its benchmark rate by 0.75 percentage point to 2.5 percent, the eurozone’s biggest cut ever.
Sweden lopped a record 1.75 percentage points off its policy rate to 2.0 percent, while the Bank of England chopped rates by 1 percentage point to 2 percent, the lowest level since 1951.
In addition to slashing borrowing costs, central bankers have been considering more direct actions to protect their economies. After cutting rates, the Bank of England is mulling buying up government debt and flooding markets with cheap cash to prevent a more severe recession, an unsourced report from the Daily Telegraph newspaper said.
Governments were trying to align their efforts with the deluge of central bank rate cuts.
South Korean officials said that if needed more help was on the way to the economy and financial markets.
“Aggressive countermeasures are required for the automobile, semiconductor and petrochemical sectors due to a rapid decline in export demand, falling export prices, an intensifying global competition and a supply glut,” the Ministry of Knowledge Economy said in a report.
France announced a 26 billion euro (US$32.9 billion) stimulus plan targeting infrastructure and investment projects for its faltering economy as data showed the unemployment rate rose in the third quarter to 7.7 percent..
Time was of the essence though, as economic data globally reflected rapidly worsening conditions.
“I believe we could lose General Motors by the end of this month,” Ron Gettelfinger, president of the United Auto Workers told lawmakers. “Honestly, we’re down to the wire.”
The government is aiming to recruit 1,096 foreign English teachers and teaching assistants this year, the Ministry of Education said yesterday. The foreign teachers would work closely with elementary and junior-high instructors to create and teach courses, ministry official Tsai Yi-ching (蔡宜靜) said. Together, they would create an immersive language environment, helping to motivate students while enhancing the skills of local teachers, she said. The ministry has since 2021 been recruiting foreign teachers through the Taiwan Foreign English Teacher Program, which offers placement, salary, housing and other benefits to eligible foreign teachers. Two centers serving northern and southern Taiwan assist in recruiting and training
WIDE NET: Health officials said they are considering all possibilities, such as bongkrekic acid, while the city mayor said they have not ruled out the possibility of a malicious act of poisoning Two people who dined at a restaurant in Taipei’s Far Eastern Department Store Xinyi A13 last week have died, while four are in intensive care, the Taipei Department of Health said yesterday. All of the outlets of Malaysian vegetarian restaurant franchise Polam Kopitiam have been ordered to close pending an investigation after 11 people became ill due to suspected food poisoning, city officials told a news conference in Taipei. The first fatality, a 39-year-old man who ate at the restaurant on Friday last week, died of kidney failure two days later at the city’s Mackay Memorial Hospital. A 66-year-old man who dined
‘CARRIER KILLERS’: The Tuo Chiang-class corvettes’ stealth capability means they have a radar cross-section as small as the size of a fishing boat, an analyst said President Tsai Ing-wen (蔡英文) yesterday presided over a ceremony at Yilan County’s Suao Harbor (蘇澳港), where the navy took delivery of two indigenous Tuo Chiang-class corvettes. The corvettes, An Chiang (安江) and Wan Chiang (萬江), along with the introduction of the coast guard’s third and fourth 4,000-tonne cutters earlier this month, are a testament to Taiwan’s shipbuilding capability and signify the nation’s resolve to defend democracy and freedom, Tsai said. The vessels are also the last two of six Tuo Chiang-class corvettes ordered from Lungteh Shipbuilding Co (龍德造船) by the navy, Tsai said. The first Tuo Chiang-class vessel delivered was Ta Chiang (塔江)
RESTAURANT POISONING? Deputy Minister of Health and Welfare Victor Wang at a press conference last night said this was the first time bongkrekic acid was detected in Taiwan An autopsy discovered bongkrekic acid in a specimen collected from a person who died from food poisoning after dining at the Malaysian restaurant chain Polam Kopitiam, the Ministry of Health and Welfare said at a news conference last night. It was the first time bongkrekic acid was detected in Taiwan, Deputy Minister of Health and Welfare Victor Wang (王必勝) said. The testing conducted by forensic specialists at National Taiwan University was facilitated after a hospital voluntarily offered standard samples it had in stock that are required to test for bongkrekic acid, he said. Wang told the news conference that testing would continue despite