World Economic News
German Real Estate Rally Coming to an End
The excessive growth of real estate activities in Germany over the past 12 months, has left many real estate funds over-exposed, Germany's Die Welt daily and other media warned Aug. 24.
Up to five-fold speculative increases in asset values of funds like Colonia Real Estate or Adler Real Estate during the past 12 months, do not correspond to the market reality, and the "first U.S. equity funds that have helped to get the whole real estate boom in Germany off the ground, are getting ready now for the withdrawal," a Frankfurt-based market insider is quoted by Die Welt. Other expert assessments are going in the same direction of warning that "the big hype is over."
BHP Billiton Using Huge Profits To Buy Back Shares
BHP Billiton is using part of its mammoth $15 billion in profits to buy back shares, the London Daily Telegraph reported Aug. 22-23. This is the first time a metals conglomerate has moved into the range of the Big Six oil companies' mega-profits. BHP also announced it would buy back $3 billion of shares, on top of a $2 billion buyback in May, even as miners have not seen a wage increase in a decade. Billiton, Rio, and CVRD have imposed 90% iron-ore price increases since mid-2004. BHP is also the major global copper and nickel producer. Currently it is being struck by Child miners' union at Escondida, the world's biggest copper mine.
Mittal, Nippon To Increase Steel Production for U.S. Auto Market
Mittal and Nippon will increase their output of steel used for auto production in the United States, according to the Financial Express Aug. 24. The increase will be made at I/N Kote, an equally owned joint venture between Nippon Steel and Mittal, located near New Carlisle, Indiana, supposedly to deal with an acute shortage of auto-use steel given large expansion plans by Japanese auto makers in the United States.