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2012_0518 - General Insurance

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Construction economic rebound NZ. The construction sector is likely to be the foundation of healthy growth in the New Zealand economy over the next two years, with rebuilding after Christchurch's earthquakes only part of the lift. Bank of New Zealand senior economist Craig Ebert said the distractions of Europe's debt crisis have blinded some to the huge insurance payouts which will lead to extensive Christchurch home and non-residential construction. The country has also gone through a building slump since the global financial crisis of 2008, and even the effect of recovery from this slowdown would have a significant upward impact on the construction sector, he said. "The potential to ramp up is quite high," he said. Next to a quite healthy primary sector, "construction could be the most important sector in the next couple of years.

" The number of building consents issued in Christchurch are still comparatively low, but are expected to sharply increase in coming quarters. - BusinessDesk. IBM helps oil companies manage data gush. IBM thinks it can make geologists and engineers more effective at mining the fast-growing wealth of data on everything from oil reservoirs to refineries to help them find, extract and process oil. The computer services company has spent the past three years building a team of 5000 consultants, scattered around major oil basins worldwide, to help companies tackle the data explosion. Just having a lot of data is not enough: As with crude, data must be refined and then shipped out to the people who can use it: those who make drilling decisions with millions of dollars on the line.

"Data management: we see a lot of effort, and by effort I mean investment, in that space," David Womack, IBM's director of strategy and business development for chemicals, petroleum and industrial products, told the Reuters Global Energy & Environment Summit on Tuesday. "They'll give you these big data sets, and being able to manage and manipulate that is a non-trivial act," he added. Samsung replaces Nokia as leading phone maker. By Brian Corrigan Samsung became the world’s No.1 phone maker during the first quarter of 2012, with Gartner research showing that Nokia had been knocked off its perch for the first time in 14 years. Mobile phone sales fell 2 per cent during the three-month-period to 419.1 million, the first time that sales have dropped since the second quarter of 2009.

Gartner research analyst Anshul Gupta blamed the drop on an unexpected slowdown in Asia-Pacific demand, with consumers delaying purchases due to a lack of new products from leading brands. Global martphone sales continue to go from strength to strength. Apple’s sales jumped 96.2 per cent thanks largely to rapid growth in China, which is now its second biggest market behind the US. Apple’s global sales growth was more than twice as large as the 44.7 per cent recorded in the overall smartphone market. Devices running on Google’s Android operating system continue to dominate the smartphone market, accounting for 56.1 per cent of global sales. Google Search Just Got 1,000 Times Smarter. The Google Search of the future is here. Now. Today. The long-talked-about semantic web — Google prefers “Knowledge Graph” — is rolling out across all Google Search tools, and our most fundamental online task may never be the same again.

Starting today, a vast portion of Google Search results will work with you to intuit what you really meant by that search entry. Type in an ambiguous query like “Kings” (which could mean royalty, a sports team or a now-cancelled TV show), and a new window will appear on the right side of your result literally asking you which entity you meant. To understand the gravity of this change, you need to know about the fundamental changes going on behind the scenes at Google Search.

As Ben Gomes, Google Fellow, put it, Google is essentially switching “from strings to things.” To build this world of things, Google is tapping a variety of knowledge databases, including Freebase, which it bought in 2010, Wikipedia, Google Local, Google Maps and Google Shopping. How Google search just got smarter. Knowledge Graph displays biographical information on Marie Curie in a panel next to Google’s standard results page.

Source: Google Ben Woodhead If you’ve ever thought Google just doesn’t get what it is you’re asking it, then that’s about to change. Over the coming days, some web surfers will get their first glimpses at a radical overhaul of the way Google characterises and displays results, providing they’re US English users and, if they’re on the go, are packing the latest versions of the Android and Apple mobile operating systems. Initially, it’s also necessary to be logged into a Google account. Known as the Knowledge Graph, or somewhat more colloquially as semantic search, the feature aims to make it easier for users to narrow their search to a specific subject when they are using terms, such as “kings”, that could deliver results on anything from people, to bands and sports teams.

“Take a query like ‘taj mahal’. “But we all know that ‘taj mahal’ has a much richer meaning. FACEBOOK Why the IPO model is broken. Felix Salmon Tech IPOs are not always stellar performers, despite their reputation. Chris Hondros, Getty Images As Facebook went public on Friday, it was set to be worth more than General Motors, the New York Times Company, and Sprint Nextel combined. In the next few days the smiling face of chief executive, Mark Zuckerberg, will appear on the front page of newspapers around the world. But don’t be surprised if that smile looks like the forced grin of someone dragged to the altar.

Truth be told, Zuckerberg is going public not because he wants to but because US Securities and Exchange Commission (SEC) rules have forced his hand. Once a company takes on more than 500 shareholders – a number that Facebook easily surpasses if you include all the investors and employees who have bought or received shares over the years – it must register its stock. Zuckerberg clearly does not relish this prospect, and he has taken great pains to preserve his iron grip on Facebook. Or take Zappos. Wired. Facebook employees spend all night programming in “Hackathon” before IPO makes them millionaires. Mark Zuckerberg (AP) They have Dom Perignon bank accounts, but Red Bull is still in their blood. Tech geeks across the Facebook empire — including the New York office — celebrated the company’s IPO and their newfound millions by slugging back energy drinks at all-night code-writing parties.

Legions of the social network’s employees, who will be worth an average of $2.9 million apiece on paper when the stock opens trading this morning, dressed for the occasion with matching “Hackathon” T-shirts. They kicked off the party at their Menlo Park, Calif., headquarters, just hours after the company’s 420 million available shares were priced at $38 each. The festivities were expected to rage through the night until founder Mark Zuckerberg rings the Nasdaq opening bell via video feed at 9:30 a.m. And they had plenty to celebrate. According to the IPO prospectus, $10 billion in equity will be held by insiders at the social-media site. But the shares won’t come cheap. Foreign investment in China falls again. Iron ore demand to drop: Kloppers. A one-two blow from Greece and China | Karen Maley. Greece Worries Pummel Markets. Oil prices to double by 2022, IMF paper warns.

Amit Kara: German Stimulus Won't Save Europe. Why Australia won't catch the Greek disease | Stephen Bartholomeusz. The best default Greece could have | Wolfgang Munchau, Financial Times. Greeks withdraw €3bn in 10 days since election | World news. Greeks are withdrawing large amounts of money fearing their country will leave the eurozone and return to the drachma. Photograph: Phil Noble/PA Greeks have withdrawn €3bn (£2.4bn) from the banking system since the country's inconclusive elections on 6 May, with tellers saying savers were making two or three visits a day to local banks. Savers fear Greece leaving the eurozone and returning to the drachma. An aide to the outgoing prime minister, Lucas Papademos, said there were "serious fears that the banks were running out of money". Greece's president, Karolos Papoulias, warned on Monday that €700m had been withdrawn but said he had been assured by the governor of the Greek central bank, George Provopoulous, that there was no panic yet.

According to minutes of a meeting on Monday, Papoulias said: "Withdrawals and outflows by 4pm when I called him [Provopoulous] exceeded €600m and reached €700m. Ward warned this could be vulnerable. Bankia clients pull out over 1 bln euros -report. Shares slump 2pc on mining sector declines. Australian stocks were down close to 2.1 per cent in afternoon trading with the resources-linked sectors doing it toughest on a day of broad-based declines.

At 1.50pm AEST on Wednesday, the benchmark S&P/ASX 200 index was down 88.9 points, or 2.08 per cent, at 4,177.4 points, while the broader All Ordinaries index had fallen 89.9 points, or 2.1 per cent, to 4,226.4 points. The market opened about 1.3 per cent lower, as investors took their cues from a weak night on Wall Street and ongoing troubles in Europe, and moved further into the red during throughout the day. ■ The worst-performing sector was gold stocks, down 4.3 per cent, led by Newcrest Mining’s continuing decline, down 4.5 per cent today. ■ The metals and mining sector (down 3.7 per cent), was dominated by the downward movement of BHP Billiton (3.4 per cent so far today) and Rio Tinto, down 3.5 per cent. ■ Energy stocks fell 2.9 per cent in afternoon trading, with Woodside Petroleum down 3.3 per cent and Santos down 2.6 per cent.

Confidence ‘disappointing’: Westpac. Consumer confidence ... still surprisingly low. Photo: Patrick Cummins Jacob Greber and Jenny Wiggins Toll Holdings chief executive Brian Kruger says conditions have never been tougher. “[I’ve] never seen or been involved in a market where there’s been so much noise from our customers about the need for us to help them manage their margin issues,” he said. Toll on Wednesday joined a growing list of companies to downgrade their profit forecasts. The transport company’s shares slumped 15.2 per cent on a bleak day for share markets in which the benchmark S&P/ASX 200 index fell 2.4 per cent, the worst session since December 19.

Westfield Group co-chief executive Steven Lowy added to the gloom at the property giant’s annual meeting, reporting that the squeeze was hurting retailers. Mr Kruger said it had been very difficult for Toll to boost its rates while retailers were feeling the squeeze on their profits. Westfield shares fell 2.23 per cent as a result. Goldilocks and the three economic shocks - The Drum.

Updated Thu 17 May 2012, 12:10pm AEST I was chatting yesterday to an internet entrepreneur and consultant in Sydney named Billy Tucker and asked him why there is a new internet boom going on that feels bigger, and much more substantial, than what happened in the 90s. His answer surprised and excited me: it's because in the past 1-2 years, women 55+ have suddenly gone online, en masse.

They control the nation's purse strings. When they are buying online, everything changes, and every night they are sitting in front of the TV using a laptop or a tablet ... and shopping. At about the same time that conversation was taking place in Glebe, the secretary of the Treasury, Martin Parkinson, was delivering his annual post-budget address to the Australian Business Economists at the Westin Hotel in the city.

His address focused on the three shocks that Australia has faced in the past few years - "the most significant - some may say the largest - shocks seen since World War II... ". Goldilocks anyone? 2.7m Australians struggle to pay off credit. More than 2.7 million Australian consumers are finding it hard to meet their credit commitments, and many are likely to try to overcome difficulty by applying for more credit. Data and intelligence provider Veda said on Thursday that about one in four among this group of consumers could fall into a debt spiral if Australia suffers an economic downturn.

Veda's twice-yearly Australian Debt Survey found that in a time of economic stress 25 per cent of struggling consumers would seek to increase their credit card limit, mortgage or loan. In tough times, most consumers would draw upon their savings, before borrowing from family or drawing upon their superannuation. Veda said that, currently, consumer credit reports do not show a person's credit limit or if they are failing to make minimum payments on their credit cards or loans. "It makes it easier for someone already in trouble to get yet more credit, pushing further into a downward debt spiral," Veda said. Volatility frustrates the funds. ING’s Asian Asset Management Operation Attracts Bids - Deal Journal Australia.

By Alison Tudor and Prudence Ho ING Groep’s sale of its Asian investment management business has attracted bids from Japan’s Nikko Asset Management, Australia’s Macquarie Group and others, in an auction that could value the operations at around US$500 million, people familiar with the situation said Tuesday. Associated Press According to some of the people, those other bidders included Singapore’s United Overseas Bank.

ING is also selling its larger Asian insurance operations, which together could be valued at more than $7 billion, equity analysts estimate. A sale of both Asian units would allow ING to repay the Dutch state for the remainder of the aid received in 2008, the analysts said, removing restrictions on the day-to-day running of the business such as compensation. The sale would also simplify ING’s structure, pave the way for more disposals and tighten focus on banking operations. ING said recently that the sale of Asian assets had started and was progressing well.

Forget the economy, there's blood in the water | Alister Drysdale. Miners write Australia’s tax laws : Kearney. Commonwealth looking slimmer at the margins. Tasmanian deficit $283m despite higher taxes. Greece fears pushing up funding costs: CBA. CBA boss Ian Narev: “The financial strength of the group continues to enable us to take a long-term view of the business, with focus on enhancing our core capabilities of technology, a customer-focused culture and balance sheet strength, to drive customer satisfaction and good returns to our shareholders.”

Photo: Nic Walker George Liondis Commonwealth Bank of Australia has revealed that it was forced to make contingency plans in case of Greece’s exit from the euro as the debt-riddled country’s political crisis sends shockwaves reverberating through world markets. With Greece heading for fresh elections that could decide whether it remains in the euro zone, CBA chief executive Ian Narev said a retreat from the currency bloc would have a “material” impact on the global ­economy. “The world and financial markets have for some time been looking at what might happen here and for some time been seeing a Greek default and a Greek exit from the euro as a possibility,” Mr Narev said. Banks fund offshore investors. Banks won't break their sweet addiction | Alan Kohler. JPMorgan’s $2bn loss extraordinary: ANZ chief. Risk models pale imitations of real thing.

Digital Edition. Aussie bankers are hot property abroad. Bank moves factored into RBA cut. Scrap the big four’s ‘protected species’ status. Mark Bouris and Christopher Joye With four big banks that have a combined market captilalisation of about $250 billion, and control 80 to 90 per cent of all Australian financial transactions, and dominate the planning and funds management industries, it’s understandable they attract attention. But don’t blame the bankers. By choosing to pass on their costs to the 5 million families who have home loans, and to millions of small business borrowers, rather than absorbing these costs themselves, they are simply doing what all good oligopolists do: exploiting market power.

They are aiming to preserve world-beating, double-digit returns on equity for the benefit of themselves and their shareholders. That’s rational. The answer to Australia’s banking problems lies not with bank executives, who have but one sensible objective – profit maximisation. Banking is a simple business: those with the lowest funding costs generally win. This is incorrect. Suncorp’s Snowball slams budget message. Suncorp under a growing claims cost cloud.

General Insurance update

The banking brontosaurus is nibbling at its own tail. US regulation debate a ‘banking hell’ Regulator defends higher fees. Shares down as European fears worsen. Superannuation Threat to your savings. House prices may fall further: NAB. ABC Ken Henry itw. Henry warns of upward pressure on ‘safe’ $A. RBA forecast raises rate cut hopes. States reel as GST slump bites.