Rome, 6 mag (Velino) – Milan’s Piazza Affari was leading a negative trend all over Europe, with losses around 0.70 per cent for Its Mibtel index, but not too far from other depressed leading exchanges like Paris (down 0.55 per cent) Frankfurt (losing 0.54 per cent) or London (down 0.53 per cent). Most Stock Exchanges appear cautious waiting for the season of first quarter results, while those already published have already caused some turmoil. The best example, as anticipated yesterday, was UBS which confirmed today losses for 11.5 billion francs and a conspicuous number of redundancies. The Swiss giant, which was losing five per cent in Zurich, announced that the planned redundancies (to be completed by August next year) are 5,500, almost one third less than anticipated by analysts, as we reported yesterday. The UBS activities most severely hit was confirmed to be investment banking, with 2,600 redundancies planned, almost half of the total. UBS announced as well the planned sale to US giant Black Rock some 22 billion dollars in assets at risk, while confirming that the group paid heavily for the sub prime mortgage crisis (loses linked to that crisis are estimated around 19 billion dollars) and that the bank will abandon its traditional activity in local authorities bond. Forecasts are obviously quite cautious: the bank analysts predict a very difficult market for the rest of the year and obviously this gloomy picture affected bank shares all over Europe. In Milan, all banks were very weak, with the sole exceptions of Monte dei Paschi di Siena ( up 1.47 per cent) and Banca Popolare di Milano (up 0.6 per cent).Apart from the financial shares syndrome, commodities prices and inflation fears seem to be a dominant reason for caution by operators. So the news that Goldman Sachs economists are predicting oil prices rocketing upwards even to reach and pass 150 dollars a barrel and maybe hitting the 200 dollars per barrel once unthinkable ceiling really did not help. Especially with oil prices already jumping at almost 121 dollars in New York. Analysts are really worried because the 150-200 dollars new ceiling has been forecasted by Arjun Murti, the same oil analyst who in March 2005 had terrified all of us with price estimates of 50-105 dollars per barrel, and all of us know perfectly well how right he was.
Meanwhile, the economic and financial pastime of the moment is the national debate on the publication on the internet by the Inland Revenue of Italians’ incomes in 2005. Today the Privacy Guarantor confirmed that the action has to be considered totally illegal, so consumers association are planning class actions against the government and somebody is talking about a request of damages for 20 billion Euro. Something which sank further down our evaluation of economic sensibility in this country where the love for a good fight and a good argument is not evident only in soccer stadiums but in serious political and economic discussions as well. The first question which came to our mind in listening to the damages request was who is going to pay: the State, is the obvious answer. And where is the State going to find such a sum (the equivalent of a Finanziaria)? From fiscal resources is the second obvious answer. In other words citizens would get damages but they would be paying for them. Clever, isn’t it?
