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BW Businessworld

AIG: The Biggest Loser in ’08

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The New York-based insurance major American International Group (AIG) has topped The Fortune 500’s Biggest Losers list. The company recorded a total loss of $99.3 billion in 2008. Fannie Mae took the second spot with losses of $58.7 billion, closely followed by Freddie Mac ($50.1 billion), General Motors ($30.9 billion) and Citigroup ($27.7 billion). The Fortune 500 witnessed its worst slump ever in 2008. Over 125 of the US’s 500 largest companies traded in the red and collectively lost over $500 billion. Thirty-eight companies disappeared from the list and total profits fell by 84.7 per cent to just $98.9 billion.






Source: International Monetary Fund

 
 

 



THE JOB MARKET


General Motors: The US auto maker has asked 1,600 of its US employees to leave by 1 May 2009.

Fiat: The Italian auto maker said it would cut 4,600 jobs at its US subsidiary CNH, a construction equipment maker.

Asia Troubles: The International Labour Organization said 23 million people are expected to lose their jobs in Asia
this year.



INDIA IMPACT


Target Affected: IT industry association Nasscom has said the global economic downturn will delay the 2010 export revenue target of $50 billion by three-four quarters. Nasscom said the “global economic crisis will have far-reaching impact on the industry. Near-term volumes and pricing is likely to come under pressure”.

GDP Forecast: The Reserve Bank of India (RBI) said the Indian economy will grow at 6 per cent in fiscal 2009-10 — its weakest GDP growth projection in seven years. RBI Governor D. Subbarao said the lower GDP growth projection was mainly because of the current recessionary global economic condition, which has affected India’s export badly.



GLOBAL WATCH


Deflation Mode: The UK has slipped into deflation for the first time in 50 years. The country’s retail price index slowed to -0.4 per cent in March 2009. Chancellor Alistair Darling has said that the country is facing its worst economic crisis in 60 years, and that rescuing the banks could cost Britain about £50 billion.

Turning Negative: Caterpillar Inc, the world’s largest construction equipment maker, has reported its first quarterly loss in 16 years. The company posted a loss of $112 million in the first quarter of 2009 compared to profit of $922 million in the previous year.

22% The decline in global crude steel production in the first three months of 2009.

(Businessworld Issue Dated 27 April-04 May 2009)