The Gross domestic product (GDP) grew by 0.4 percent in the euro area (EU-16) and by 0.3% across the EU in the third quarter of 2009, said the community’s statistical office Eurostat. In the second quarter of 2009 growth was -0.2% in the euro area and -0.3% in the EU27. Compared with the third quarter of 2008, GDP declined by 4.1% in the Eurozone and 4.3% in the EU27, after -4.8% and -5.0% respectively for the previous quarter a year ago. In the third quarter of 2009, consumer spending fell by 0.2%, at 0% and -0.1% respectively for the previous quarter. Investments decreased by 0.4% in the eurozone and by 0.5% in the EU27 (-1.7% in reported and -2.5% the previous quarter). Exports increased by 2.9% in the Eurozone and 2.4% in the EU27 (-1.3% respectively at -1.4 percent and the previous three months). Imports increased by 2.6% in the eurozone and by 2.4% in the EU27 (in-2, respectively, 9% in both zones). To compare the U.S. GDP increased by 0.7% in the third quarter of 2009, after -0.2% in the second quarter of 2009.
Read the full story

Most large U.S. banks will soon have to take public offerings if the Treasury require repayment of funds lent to them by the program to buy troubled assets (TARP), Reuters said banking analyst Richard Bouv. Earlier this month asked the Federal Reserve Banks, subject to “stress test” to come forward with plans to repay the amounts allocated in exchange for the issued preference shares in them. “In fact, all banks can easily redeem these securities of its cash balances, but only 3 of the top 30 banks would be left with adequate Tier if they do,” explains Bouv. It is believed that the Treasury aims ratio Tier assets to 12 percent, which means that banks will be forced to raise capital without government assistance before they are allowed to repay the funds under the program continues Bouv. “It stirs the thought that some banks would rather have public offerings, although their profits are in doubt.” Rochdale Securities analyst said that the swell of the U.S. budget deficit, which is expected to reach 9.5 percent of GDP in this fiscal year and the drop-down dollar, forcing the government to obtain funds where possible. Collection of funds awarded through the TARP program is one of the possible sources, according Bouv. Many banks want to return the funds received under the program, which was worth 700 billion dollars as participation in it is associated with restrictions on expenditure on salaries, dividends and redemptions.
Read the full story

Lithuania will not adhere to the “painful” scheme for adopting the euro, which will shrink consumption and greatly harm the economy, said Prime Minister of the country Cubilus Andrews. The country probably will fail to meet EU requirements for the deficit within 3 percent of GDP by 2011, so the adoption of the euro can not happen before 2013, said in an interview yesterday, Finance Minister of Lithuania Ingrid Simon. “These are very ambitious and very painful measures, and, of course, there are any limits on what measures can enter,” said Cubilus. The aim is not to kill the entire economy and stability in society by reducing costs, salaries and pensions. Lithuania’s economy contracted by 14,3 per cent in the third quarter after the government took budget cuts, equivalent to 8 percent of GDP this year. Even after these stringent measures, the evaluation of the European Commission Lithuania will have a deficit of 9,7 per cent in 2011 to 9.8 per cent for this. Lithuania, whose currency – liras is tied to the euro should be introduced European single currency “as soon as possible, but the opportunities in turn have practical limits and practical measures should be introduced,” said Cubilus. The government has proposed the 2010 budget cuts of 5 percent of GDP, aimed at social welfare. Lithuania lags behind neighboring Estonia, which plans to join the eurozone from January 1, 2011, after years of using the government budget surplus for the establishment of reserves. This allowed the public finances remain intact even after the crisis hit the country.
Read the full story