Shareholders reeling after £36BN is wiped off the stock market
By Daily Mail Reporter 09th July 2008
Millions of shareholders were reeling last night after a stock market plunge which wiped as much as £36billion off the value of Britain's biggest listed companies.
Fears that the economy is on the brink of a recession sent the FTSE 100 index of leading shares tumbling as much as 2.8 per cent to its lowest level since November 2005.
The catastrophic fall sent the Footsie briefly below the all-important 5,384 level - 20 per cent below its peak last October and into what City traders called a 'bear market'.
Investors take a move into 'bear' territory as a signal to sell shares and put their cash into safer investments.
The FTSE dropped as low as 5,358, a fall during the day of more than 154 points, but rallied to close down 72 points at 5,440.5.
The sell-off will send shivers down the spine of the legions of small investors across Britain. Millions more could be affected as almost all company pension funds put money in shares.
More than £250billion has now been erased from the value of Britain's leading shares since the credit crunch started last summer following the collapse of the U.S. low-income property market.
The latest plunge was triggered by a stark warning from the British Chambers of Commerce that the economy may be only months away from going into recession.
Businesses have put the brakes on investment amid a growing mortgage drought, falling house prices and sky-high energy and food costs, said the lobby group.
Shares in Britain's biggest banks fell sharply on fears that an economic reverse will see tens of thousands of homeowners default on their mortgages.
Investors also took fright at speculation that America's two biggest mortgage companies, state-backed Fannie Mae and Freddie Mac, may need to raise £38billion in fresh capital to cover mounting property market losses.
Bradford & Bingley lost another fifth of its value as it emerged that the six major High Street banks have stepped in to safeguard its attempt to raise £400million.
Even Barclays, which claims to have been largely immune from the sub-prime crisis, fell back after shutting a specialist home loan division with the loss of around 300 jobs.
Black Tuesday as FTSE plummets, bank shares tumble and Britain faces recession 'within months'
By Becky Barrow, Niall Firth and Nicola Boden 08th July 2008
* FTSE enters 'bear market' with 20% fall from October's high
* Housebuilder Persimmon cuts 1,100 jobs
* BCC says recession coming 'within months'
* Government left with £7.5billion black hole in finances
* M&S bucks trend as shares in retailer bounce back
Britain was facing a deepening economic crisis today as the FTSE plunged into a so-called 'bear market' for the first time in five years and a series of reports laid bare the full extent of the problems facing the nation's economy.
In a Black Tuesday for the stock market, shares fell across the board while a gloomy new report warned that a recession could be on its way within a matter of months.
A separate report from accountants KPMG shows the number of permanent job vacancies fell in June for the first time in five years.
In further bad news for the economy, shares in struggling bank Bradford and Bingley plunged 25 per cent to just 30p at one stage this morning.
In its report, the British Chambers of Commerce describes Britain's economic outlook as 'grim' and warns the UK could slide into a recession within months.
It says it has uncovered evidence of a 'menacing deterioration' in the economic outlook.
At one stage today the FTSE 100 dropped more than 150 points to 5358.7 in early trading in a knock-on effect after a sharp overnight drop on Wall Street.
One City analyst warned the housing market could take 20 years to recover from the credit crunch.
At its worst point, it had fallen 20 per cent since its last peak in October - the standard definition of a bear market.
The previous bear market lasted from autumn 2000 to spring 2003 when share values halved.
The term refers to a situation where shares fall more than 20 per cent from a recent trading high, which then develops into a vicious circle because traders are continuing to sell, bringing prices down even further.
At one point today all 100 firms listed in the FTSE were down but a late morning rally left the blue chip index only 70 points lower by lunchtime.
Some of the biggest fallers included household names such as Royal Bank of Scotland and ITV, both down five per cent.
Bradford and Bingley shares also continued to plummet, with some experts claiming their shares were now worthless.
Speculation two U.S. mortgage providers might have to raise more capital and make more writedowns triggered the American sell-off yesterday.
The Dow Jones opened lower today but quickly bounced back thanks to a sharp pullback in oil prices and reassurances from the Federal Reserve.
In early trading, it had risen more than 40 points - 0.39 per cent - up to 11,275.76.
After Wall Street opened strongly this afternoon the FTSE was down 97.5 at 5415.2 at 4pm.
Back in the UK, the list of woes grew with beleaguered housebuilder Persimmon confirmed it was having to lay off 1,100 jobs so far this year because of the housing crisis.
The firm revealed its sales had fallen 31 per cent in the past six months as it confirmed it had cut 1,100 jobs so far this year and said the past six months had 'undoubtedly been the most challenging period' in its recent history.
Average selling prices had fallen to £181,500 in the first half of the year from £189,255 in the same period last year, it added.
Persimmon, which is one of the UK's biggest housebuilders, said half-year sales revenues were down by more than a third at £1billion.
The 1,100 job cuts come as part of an overhaul to save money amid the housing market woes.
Its announcement came after the British Chamber of Commerce had said the number of people being put into permanent jobs by recruitment agencies had fallen at its sharpest rate in more than five years.
The group's report also warned another 300,000 workers could lose their jobs over the next 18 months unless the economic situation improves.
This is equal to 550 losing their jobs every day, including weekends, by the end of 2009.
David Frost, director general of the business lobby group, said there is 'a real risk of recession in the coming months'.
He said: 'The outlook is grim. We believe that the correction period is likely to be longer and nastier than anticipated.'
Nearly 5,000 firms took part in the research for the BCC report.
Low unemployment has been a feature of recent years, but official figures have started to show that the jobless total is beginning to increase.
The number who do not have a job - but want to work - jumped 38,000 to 1.64million in the three months to the end of April.
The KMPG report, published jointly with the Recruitment and Employment Confederation, said there is worse to come.
Alan Nolan, director of KPMG, said: 'This really is a sobering set of figures proving the credit crunch has finally taken its toll and is now severely weakening the UK jobs market.
'Many employers now seem to be accepting the inevitable - they will have to cut costs by laying off people because their businesses won't be growing as much as they could have expected a couple of months ago.'
Thousands of redundancies in the City and the housebuilding sector are just the start, he added.
The report involved interviews with 400 recruitment and employment consultancies. The official definition of a recession is two or more consecutive quarters of negative economic growth.
David Kern, economic adviser to the British Chambers of Commerce, said he is expecting negative growth for the rest of the year.
He does not expect growth to return to normal levels until 2010 at the earliest.
The deepening economic crisis has also left the Treasury facing a £7.5billion black hole in its Budget next year, according to a respected research body.
The figures, collated by the National Institute of Economic and Social Research, will increase anxiety among Labour MPs that they are heading towards a general election with the public finances in turmoil.
Such a deficit - if proved to be that large - will mean that Chancellor Alistair Darling will either have to put up taxes, cut spending or borrow more.
The black hole is the equivalent of cutting 57,000 teaching jobs, cancelling two giant aircraft carriers ordered by the MoD and closing five hospitals.
There was some good news amid the gloom today. Marks & Spencer share values soared amid talk of a possible bid for the retailer.
M&S has been hammered since a shock profits warning last week, with around £1.7billion wiped off the value of the business.
But the firm rose as much as seven per cent to the top of FTSE 100 Index after rumours of possible takeover candidates including supermarket Sainsbury's, Delta Two - the Qatari fund which attempted to buy Sainsbury's last year - and billionaire retailer Sir Philip Green.
Iran Says It Will Hit U.S. Ships, Israel, If Attacked
By Ladane Nasseri
July 8 (Bloomberg) -- Iran would strike Israel and the U.S. Navy in the Persian Gulf as a first response to any American attack on its nuclear program, an aide to Supreme Leader Ayataollah Ali Khamenei said.
Israel wants the U.S. ``to prepare a military aggression against Iran,'' the state-run Fars News agency today cited Ali Shirazi, Khamenei's representative in the Revolutionary Guards' naval division, as telling military personnel. ``If they resort to such a silly undertaking, Tel Aviv and the U.S. fleet in the Persian Gulf will be the first targets'' of Iran's response.
Tensions over Iran increased, helping push the price of oil to a record, after a New York Times report that Israeli military maneuvers in the eastern Mediterranean last month were in preparation for a possible strike on Iran's nuclear facilities. Shirazi's comments came as Iran conducted military exercises designed to strengthen the combat capacity of its missile and Navy units, Fars said in a separate report.
Fars didn't give details of the maneuvers. Shirazi, though, said Iran and its forces were now at the peak of their ``capability, power and readiness.''
President Mahmoud Ahmadinejad said Iran will maintain its nuclear activities, according to written responses to questions from Japan's Yomiuri newspaper.
Ahmadinejad said today Iran has the right to develop a nuclear program, while declining to say whether his country will suspend uranium enrichment as required in a package of incentives from the world powers.
Call for Trust
``The world governments should trust the Iranian government,'' Ahmadinejad told reporters in Kuala Lumpur, where he is attending a summit of the Eight Islamic Developing Countries. ``We do believe if there is cooperation with the Iranian government, it is for their own benefit.''
Iran, a signatory to the nuclear Non-Proliferation Treaty, won't accept ``illegal demands,'' Ahmadinejad told Yomiuri. G-8 countries believe they can maintain world order without paying attention to the dignity or requirements of other nations, the Iranian president said in a separate article for the newspaper.
Nuclear Weapons
The U.S. and allies accuse Iran of using its atomic program as cover for the development of nuclear weapons. Iran, which is under three sets of United Nations sanctions for refusing to halt uranium enrichment, denies the allegation and says the work is aimed at generating electricity. Enriched uranium can fuel a nuclear reactor or arm a weapon.
President George W. Bush said July 2 he is committed to pursuing a diplomatic solution to end the stalemate, yet ``all options'' remain in place.
Iran on July 4 indicated it's willing to discuss an incentives package from world powers intended to persuade the Persian Gulf nation to suspend uranium enrichment.
`Difficult'
The government in Tehran presented a reply ``with a focus on common ground and a constructive view,'' state television cited Saeed Jalili, secretary of Iran's Supreme National Security Council, as saying in a telephone call with European Union foreign policy chief, Javier Solana. Jalili didn't elaborate on the terms of the response.
Solana said yesterday that though he hoped to continue the dialogue with Iran in the coming weeks, discussions were ``difficult'' and he didn't want to give the impression of being ``too optimistic.''
U.S. warships yesterday practiced maneuvers for protecting oil rigs in the Persian Gulf, a week after the Navy vowed to counter any Iranian effort to shut the Strait of Hormuz.
``The aim of Exercise Stake Net is to practice the tactics and procedures of protecting maritime infrastructure such as gas and oil installations,'' Commodore Peter Hudson said in a Fifth Fleet statement. Ships from the U.K. and Bahrain joined the U.S. Navy in the exercises.
The head of Iran's Revolutionary Guards said June 28 that his country may close the Strait of Hormuz, which is 21 miles (34 kilometers) across at its narrowest point, if attacked by Israel.
About 20 percent of the world's daily oil supply passes through the waterway between Iran and Oman at the mouth of the Persian Gulf, according to the U.S. government's Energy Information Administration.
John Templeton, billionaire philanthropist, dies at 95
By Robert D. McFadden July 8, 2008
Sir John Templeton, a Tennessee-born investor and philanthropist who amassed a fortune in global stocks and gave away hundreds of millions to foster understanding in what he called "spiritual realities," died on Tuesday in Nassau, the Bahamas, where he had lived for decades. He was 95. His death, at Doctors Hospital in Nassau, was caused by pneumonia, a spokesman, Don Lehr, said.
The foundation awards the Templeton Prize, one of the world's richest, and sponsors conferences and studies reflecting the founder's passionate interest in "progress in religion" and "research or discoveries" on the nebulous borders of science and religion.
In a career that spanned seven decades, Sir John dazzled Wall Street, organized some of the most successful mutual funds of his time, led investors into foreign markets, established charities that now give away $70 million a year, wrote books on finance and spirituality and promoted a search for answers to what he called the "Big Questions" - realms of science, faith, God and the purpose of humanity.
Along the way, he became one of the world's richest men, gave up American citizenship, moved to the Bahamas, was knighted by the Queen of England and bestowed much of his fortune on spiritual thinkers and innovators: Mother Teresa, Billy Graham, Aleksandr I. Solzhenitsyn, the physicist Freeman Dyson, the philosopher Charles Taylor and a pantheon of Christians, Jews, Muslims, Buddhists and Hindus.
Inevitably, the Templeton charities engendered controversy. Critics called his "spiritual realities" a contradiction in terms, reflecting a fundamental incompatibility between science and religion. To many, the very idea of "progress" in religion seemed strange, and giving grants for "discoveries" in the field invited accusations that science was being manipulated to promote religion.
But Sir John was unmoved. A Yale graduate, a Rhodes Scholar, an audacious investor, a Presbyterian who preached open-mindedness and eschewed literal interpretations of Scripture, Sir John - who began annual meetings with prayers, he said, to clear the minds of shareholders - made billions as a pioneer in his globally diversified Templeton funds, often taking the old advice, "buy low, sell high," to extremes.
In 1939, when World War II began in Europe, the 26-year-old investor borrowed $10,000 and bought 100 shares each in 104 companies that were selling at $1 a share or less, including 34 in bankruptcy. A few years later, he made large profits on 100 of the companies; four turned out to be worthless.
In 1940, he bought a small investment firm that became Templeton, Dubbrow and Vance, the early foundation of his empire. Sir John embarked on mutual funds in 1954, establishing the Templeton Growth Fund in Canada to cut the taxes of many shareholders - Canada then had no capital gains tax - and to emphasize the global reach of its investment strategy.
As investor interest widened in the 1950s, he started funds specializing in nuclear energy, chemicals, electronics and technology. In 1959, with five funds and $66 million under management, he joined a surge of funds going public. Growth was dramatic. The flagship Templeton Growth Fund reported a 14.5 percent average annual return from 1954 to 1992; a $10,000 investment, with dividends reinvested, would have grown to $2 million.
Sir John sold the Templeton family of funds - scores of them with $13 billion in assets - in 1992, and turned to philanthropies that had engaged him for decades. While he was an elder of the Presbyterian Church (U.S.A.), he took a broad view of spirituality, espousing non-literal views of heaven and hell and a shared divinity between humanity and God.
Contending that almost nothing of God was actually "known" through Scriptures and theology, he founded the Templeton Prize in 1972 to foster "progress in religion" - an idea that included philosophy and exemplary conduct relating to love, gratitude, forgiveness and creativity. He called it an effort to redress the fact that no Nobel Prize was given for religion.
Its first recipient, in 1973, was Mother Teresa of Calcutta, who received $85,000 for her charities. In the 35 years since, the prize, given in London, has grown to $1.6 million. And its criteria has been refined in recent years to encompass "progress toward research or discoveries about spiritual realities."
The Templeton Foundation, based in West Conshohocken, Pa., was established in 1987 to administer the prize and promote "projects to apply scientific methodology to the study of religious subjects," with room for theoretical physics, evolutionary biology, cognitive science and researches into love, human purpose and the nature and origin of religious beliefs. Today, with a $1.5 billion endowment, it largely sustains the controversial modern movement to reconcile science and religion.
Foundation projects have included a multimillion-dollar study of forgiveness, and a two-year study to demonstrate the effect of prayer on 600 patients about to undergo surgery.
Many critics contend that reconciling science and religion is not possible, and that studies to that end are naïve, quixotic or motivated by a desire to put religious beliefs on an equal footing with scientific knowledge.
But others defend the foundation's approach, insisting that science has no monopoly on truth and that religion and science can cooperate productively.
"We have somehow to break down the barriers between our contemporary culture of science and disciplined academic study" and "the domain of the spirit," the philosopher John Taylor said in accepting the prize in 2007.
John Marks Templeton was born on Nov. 29, 1912, in Winchester, a small Tennessee town 60 miles from Dayton, the scene of the 1925 Scopes "monkey trial" pitting Clarence Darrow and William Jennings Bryan in a battle over the theory of evolution versus fundamentalist views of the Creation. The boy was only 12 then, but issues in the case dominated his later life; he wrote at least eight books on spiritual matters.
He was raised in a devout household and was the first student in town to go to college. Supporting himself at Yale in the Depression, he graduated near the top of his class in 1934, won a Rhodes Scholarship to Balliol College at Oxford University and earned a master's degree in law. He began his Wall Street career in 1937.
That year, he married the former Judith Folk. The couple had three children. His wife died in 1951. In 1958, he married Irene Reynolds Butler, who died in 1993. His daughter, Anne Templeton Zimmerman, died in 2005, and a stepson, Malcolm Butler, died in 1995. He is survived by two sons from his first marriage, John M. Jr., of Bryn Mawr, Pa., a retired surgeon and the chairman and president of the Templeton Foundation, and Christopher, of Colfax, Iowa; a stepdaughter, Wendy Brooks, of Delray Beach, Fla., and three grandchildren and three great-grandchildren.
Among his many gifts was the 1984 endowment of Templeton College, a business and management school at Oxford. In 1987, he was knighted by Queen Elizabeth II for his philanthropies. After many years on Wall Street, he renounced his American citizenship in the 1960s, became a British subject and moved to the Bahamas, a Commonwealth nation that has long been a tax haven.
Sir John said his investment record improved after he distanced himself from Wall Street and no longer worried about the tax consequences of his decisions. He was an early investor in Japan in the 1960's and later in Russia, China and other Asian markets. He sold large holdings before the technology bubble burst in 2000, and warned several years ago that real estate prices were dangerously high.
In Nassau, his net worth swelled into the billions, but his lifestyle remained relatively modest. He drove his own car and spent his days reading, writing and managing his foundation. Visitors were given sandwiches, tea and courtly advice in the afternoon at his white-columned antebellum home on Lyford Cay, set on a hillside lush with citrus trees and bougainvillea, overlooking a golf course and the ocean.
5 comments:
合抱之木，生于毫末；
九层之台，起于垒土；
千里之行，始于足下。
译:
合抱的大树，生长于细小的萌芽；九层的高台，筑起于每一堆泥土；千里的远行，是从脚下第一步开始走出来的。
1、毫末：细小的萌芽。
2、累土：堆土。
从“大生于小”的观点出发，老子阐述了事物发展变化的规律，说明“合抱之木”、“九层之台”、“千里之行”的远大事情，都是从“生于毫末”、“起于累土”、“始于足下”为开端的，形象地证明了大的东西无不从细小的东西发展而来的。同时也告诫人们，无论做什么事情，都必须具有坚强的毅力，从小事做起，才可能成就大事业。
Shareholders reeling after £36BN is wiped off the stock market
By Daily Mail Reporter
09th July 2008
Millions of shareholders were reeling last night after a stock market plunge which wiped as much as £36billion off the value of Britain's biggest listed companies.
Fears that the economy is on the brink of a recession sent the FTSE 100 index of leading shares tumbling as much as 2.8 per cent to its lowest level since November 2005.
The catastrophic fall sent the Footsie briefly below the all-important 5,384 level - 20 per cent below its peak last October and into what City traders called a 'bear market'.
Investors take a move into 'bear' territory as a signal to sell shares and put their cash into safer investments.
The FTSE dropped as low as 5,358, a fall during the day of more than 154 points, but rallied to close down 72 points at 5,440.5.
The sell-off will send shivers down the spine of the legions of small investors across Britain. Millions more could be affected as almost all company pension funds put money in shares.
More than £250billion has now been erased from the value of Britain's leading shares since the credit crunch started last summer following the collapse of the U.S. low-income property market.
The latest plunge was triggered by a stark warning from the British Chambers of Commerce that the economy may be only months away from going into recession.
Businesses have put the brakes on investment amid a growing mortgage drought, falling house prices and sky-high energy and food costs, said the lobby group.
Shares in Britain's biggest banks fell sharply on fears that an economic reverse will see tens of thousands of homeowners default on their mortgages.
Investors also took fright at speculation that America's two biggest mortgage companies, state-backed Fannie Mae and Freddie Mac, may need to raise £38billion in fresh capital to cover mounting property market losses.
Bradford & Bingley lost another fifth of its value as it emerged that the six major High Street banks have stepped in to safeguard its attempt to raise £400million.
Even Barclays, which claims to have been largely immune from the sub-prime crisis, fell back after shutting a specialist home loan division with the loss of around 300 jobs.
Black Tuesday as FTSE plummets, bank shares tumble and Britain faces recession 'within months'
By Becky Barrow, Niall Firth and Nicola Boden
08th July 2008
* FTSE enters 'bear market' with 20% fall from October's high
* Housebuilder Persimmon cuts 1,100 jobs
* BCC says recession coming 'within months'
* Government left with £7.5billion black hole in finances
* M&S bucks trend as shares in retailer bounce back
Britain was facing a deepening economic crisis today as the FTSE plunged into a so-called 'bear market' for the first time in five years and a series of reports laid bare the full extent of the problems facing the nation's economy.
In a Black Tuesday for the stock market, shares fell across the board while a gloomy new report warned that a recession could be on its way within a matter of months.
A separate report from accountants KPMG shows the number of permanent job vacancies fell in June for the first time in five years.
In further bad news for the economy, shares in struggling bank Bradford and Bingley plunged 25 per cent to just 30p at one stage this morning.
In its report, the British Chambers of Commerce describes Britain's economic outlook as 'grim' and warns the UK could slide into a recession within months.
It says it has uncovered evidence of a 'menacing deterioration' in the economic outlook.
At one stage today the FTSE 100 dropped more than 150 points to 5358.7 in early trading in a knock-on effect after a sharp overnight drop on Wall Street.
One City analyst warned the housing market could take 20 years to recover from the credit crunch.
At its worst point, it had fallen 20 per cent since its last peak in October - the
standard definition of a bear market.
The previous bear market lasted from autumn 2000 to spring 2003 when share values halved.
The term refers to a situation where shares fall more than 20 per cent from a recent trading high, which then develops into a vicious circle because traders are continuing to sell, bringing prices down even further.
At one point today all 100 firms listed in the FTSE were down but a late morning rally left the blue chip index only 70 points lower by lunchtime.
Some of the biggest fallers included household names such as Royal Bank of Scotland and ITV, both down five per cent.
Bradford and Bingley shares also continued to plummet, with some experts claiming their shares were now worthless.
Speculation two U.S. mortgage providers might have to raise more capital and make more writedowns triggered the American sell-off yesterday.
The Dow Jones opened lower today but quickly bounced back thanks to a sharp pullback in oil prices and reassurances from the Federal Reserve.
In early trading, it had risen more than 40 points - 0.39 per cent - up to 11,275.76.
After Wall Street opened strongly this afternoon the FTSE was down 97.5 at 5415.2 at 4pm.
Back in the UK, the list of woes grew with beleaguered housebuilder Persimmon confirmed it was having to lay off 1,100 jobs so far this year because of the housing crisis.
The firm revealed its sales had fallen 31 per cent in the past six months as it confirmed it had cut 1,100 jobs so far this year and said the past six months had 'undoubtedly been the most challenging period' in its recent history.
Average selling prices had fallen to £181,500 in the first half of the year from £189,255 in the same period last year, it added.
Persimmon, which is one of the UK's biggest housebuilders, said half-year sales revenues were down by more than a third at £1billion.
The 1,100 job cuts come as part of an overhaul to save money amid the housing market woes.
Its announcement came after the British Chamber of Commerce had said the number of people being put into permanent jobs by recruitment agencies had fallen at its sharpest rate in more than five years.
The group's report also warned another 300,000 workers could lose their jobs over the next 18 months unless the economic situation improves.
This is equal to 550 losing their jobs every day, including weekends, by the end of 2009.
David Frost, director general of the business lobby group, said there is 'a real risk of recession in the coming months'.
He said: 'The outlook is grim. We believe that the correction period is likely to be longer and nastier than anticipated.'
Nearly 5,000 firms took part in the research for the BCC report.
Low unemployment has been a feature of recent years, but official figures have started to show that the jobless total is beginning to increase.
The number who do not have a job - but want to work - jumped 38,000 to 1.64million in the three months to the end of April.
The KMPG report, published jointly with the Recruitment and Employment Confederation, said there is worse to come.
Alan Nolan, director of KPMG, said: 'This really is a sobering set of figures proving the credit crunch has finally taken its toll and is now severely weakening the UK jobs market.
'Many employers now seem to be accepting the inevitable - they will have to cut costs by laying off people because their businesses won't be growing as much as they could have expected a couple of months ago.'
Thousands of redundancies in the City and the housebuilding sector are just the start, he added.
The report involved interviews with 400 recruitment and employment consultancies. The official definition of a recession is two or more consecutive quarters of negative economic growth.
David Kern, economic adviser to the British Chambers of Commerce, said he is expecting negative growth for the rest of the year.
He does not expect growth to return to normal levels until 2010 at the earliest.
The deepening economic crisis has also left the Treasury facing a £7.5billion black hole in its Budget next year, according to a respected research body.
The figures, collated by the National Institute of Economic and Social Research, will increase anxiety among Labour MPs that they are heading towards a general election with the public finances in turmoil.
Such a deficit - if proved to be that large - will mean that Chancellor Alistair Darling will either have to put up taxes, cut spending or borrow more.
The black hole is the equivalent of cutting 57,000 teaching jobs, cancelling two giant aircraft carriers ordered by the MoD and closing five hospitals.
There was some good news amid the gloom today. Marks & Spencer share values soared amid talk of a possible bid for the retailer.
M&S has been hammered since a shock profits warning last week, with around £1.7billion wiped off the value of the business.
But the firm rose as much as seven per cent to the top of FTSE 100 Index after rumours of possible takeover candidates including supermarket Sainsbury's, Delta Two - the Qatari fund which attempted to buy Sainsbury's last year - and billionaire retailer Sir Philip Green.
Iran Says It Will Hit U.S. Ships, Israel, If Attacked
By Ladane Nasseri
July 8 (Bloomberg) -- Iran would strike Israel and the U.S. Navy in the Persian Gulf as a first response to any American attack on its nuclear program, an aide to Supreme Leader Ayataollah Ali Khamenei said.
Israel wants the U.S. ``to prepare a military aggression against Iran,'' the state-run Fars News agency today cited Ali Shirazi, Khamenei's representative in the Revolutionary Guards' naval division, as telling military personnel. ``If they resort to such a silly undertaking, Tel Aviv and the U.S. fleet in the Persian Gulf will be the first targets'' of Iran's response.
Tensions over Iran increased, helping push the price of oil to a record, after a New York Times report that Israeli military maneuvers in the eastern Mediterranean last month were in preparation for a possible strike on Iran's nuclear facilities. Shirazi's comments came as Iran conducted military exercises designed to strengthen the combat capacity of its missile and Navy units, Fars said in a separate report.
Fars didn't give details of the maneuvers. Shirazi, though, said Iran and its forces were now at the peak of their ``capability, power and readiness.''
President Mahmoud Ahmadinejad said Iran will maintain its nuclear activities, according to written responses to questions from Japan's Yomiuri newspaper.
Ahmadinejad said today Iran has the right to develop a nuclear program, while declining to say whether his country will suspend uranium enrichment as required in a package of incentives from the world powers.
Call for Trust
``The world governments should trust the Iranian government,'' Ahmadinejad told reporters in Kuala Lumpur, where he is attending a summit of the Eight Islamic Developing Countries. ``We do believe if there is cooperation with the Iranian government, it is for their own benefit.''
Iran, a signatory to the nuclear Non-Proliferation Treaty, won't accept ``illegal demands,'' Ahmadinejad told Yomiuri. G-8 countries believe they can maintain world order without paying attention to the dignity or requirements of other nations, the Iranian president said in a separate article for the newspaper.
Nuclear Weapons
The U.S. and allies accuse Iran of using its atomic program as cover for the development of nuclear weapons. Iran, which is under three sets of United Nations sanctions for refusing to halt uranium enrichment, denies the allegation and says the work is aimed at generating electricity. Enriched uranium can fuel a nuclear reactor or arm a weapon.
President George W. Bush said July 2 he is committed to pursuing a diplomatic solution to end the stalemate, yet ``all options'' remain in place.
Iran on July 4 indicated it's willing to discuss an incentives package from world powers intended to persuade the Persian Gulf nation to suspend uranium enrichment.
`Difficult'
The government in Tehran presented a reply ``with a focus on common ground and a constructive view,'' state television cited Saeed Jalili, secretary of Iran's Supreme National Security Council, as saying in a telephone call with European Union foreign policy chief, Javier Solana. Jalili didn't elaborate on the terms of the response.
Solana said yesterday that though he hoped to continue the dialogue with Iran in the coming weeks, discussions were ``difficult'' and he didn't want to give the impression of being ``too optimistic.''
U.S. warships yesterday practiced maneuvers for protecting oil rigs in the Persian Gulf, a week after the Navy vowed to counter any Iranian effort to shut the Strait of Hormuz.
``The aim of Exercise Stake Net is to practice the tactics and procedures of protecting maritime infrastructure such as gas and oil installations,'' Commodore Peter Hudson said in a Fifth Fleet statement. Ships from the U.K. and Bahrain joined the U.S. Navy in the exercises.
The head of Iran's Revolutionary Guards said June 28 that his country may close the Strait of Hormuz, which is 21 miles (34 kilometers) across at its narrowest point, if attacked by Israel.
About 20 percent of the world's daily oil supply passes through the waterway between Iran and Oman at the mouth of the Persian Gulf, according to the U.S. government's Energy Information Administration.
John Templeton, billionaire philanthropist, dies at 95
By Robert D. McFadden
July 8, 2008
Sir John Templeton, a Tennessee-born investor and philanthropist who amassed a fortune in global stocks and gave away hundreds of millions to foster understanding in what he called "spiritual realities," died on Tuesday in Nassau, the Bahamas, where he had lived for decades. He was 95. His death, at Doctors Hospital in Nassau, was caused by pneumonia, a spokesman, Don Lehr, said.
The foundation awards the Templeton Prize, one of the world's richest, and sponsors conferences and studies reflecting the founder's passionate interest in "progress in religion" and "research or discoveries" on the nebulous borders of science and religion.
In a career that spanned seven decades, Sir John dazzled Wall Street, organized some of the most successful mutual funds of his time, led investors into foreign markets, established charities that now give away $70 million a year, wrote books on finance and spirituality and promoted a search for answers to what he called the "Big Questions" - realms of science, faith, God and the purpose of humanity.
Along the way, he became one of the world's richest men, gave up American citizenship, moved to the Bahamas, was knighted by the Queen of England and bestowed much of his fortune on spiritual thinkers and innovators: Mother Teresa, Billy Graham, Aleksandr I. Solzhenitsyn, the physicist Freeman Dyson, the philosopher Charles Taylor and a pantheon of Christians, Jews, Muslims, Buddhists and Hindus.
Inevitably, the Templeton charities engendered controversy. Critics called his "spiritual realities" a contradiction in terms, reflecting a fundamental incompatibility between science and religion. To many, the very idea of "progress" in religion seemed strange, and giving grants for "discoveries" in the field invited accusations that science was being manipulated to promote religion.
But Sir John was unmoved. A Yale graduate, a Rhodes Scholar, an audacious investor, a Presbyterian who preached open-mindedness and eschewed literal interpretations of Scripture, Sir John - who began annual meetings with prayers, he said, to clear the minds of shareholders - made billions as a pioneer in his globally diversified Templeton funds, often taking the old advice, "buy low, sell high," to extremes.
In 1939, when World War II began in Europe, the 26-year-old investor borrowed $10,000 and bought 100 shares each in 104 companies that were selling at $1 a share or less, including 34 in bankruptcy. A few years later, he made large profits on 100 of the companies; four turned out to be worthless.
In 1940, he bought a small investment firm that became Templeton, Dubbrow and Vance, the early foundation of his empire. Sir John embarked on mutual funds in 1954, establishing the Templeton Growth Fund in Canada to cut the taxes of many shareholders - Canada then had no capital gains tax - and to emphasize the global reach of its investment strategy.
As investor interest widened in the 1950s, he started funds specializing in nuclear energy, chemicals, electronics and technology. In 1959, with five funds and $66 million under management, he joined a surge of funds going public. Growth was dramatic. The flagship Templeton Growth Fund reported a 14.5 percent average annual return from 1954 to 1992; a $10,000 investment, with dividends reinvested, would have grown to $2 million.
Sir John sold the Templeton family of funds - scores of them with $13 billion in assets - in 1992, and turned to philanthropies that had engaged him for decades. While he was an elder of the Presbyterian Church (U.S.A.), he took a broad view of spirituality, espousing non-literal views of heaven and hell and a shared divinity between humanity and God.
Contending that almost nothing of God was actually "known" through Scriptures and theology, he founded the Templeton Prize in 1972 to foster "progress in religion" - an idea that included philosophy and exemplary conduct relating to love, gratitude, forgiveness and creativity. He called it an effort to redress the fact that no Nobel Prize was given for religion.
Its first recipient, in 1973, was Mother Teresa of Calcutta, who received $85,000 for her charities. In the 35 years since, the prize, given in London, has grown to $1.6 million. And its criteria has been refined in recent years to encompass "progress toward research or discoveries about spiritual realities."
The Templeton Foundation, based in West Conshohocken, Pa., was established in 1987 to administer the prize and promote "projects to apply scientific methodology to the study of religious subjects," with room for theoretical physics, evolutionary biology, cognitive science and researches into love, human purpose and the nature and origin of religious beliefs. Today, with a $1.5 billion endowment, it largely sustains the controversial modern movement to reconcile science and religion.
Foundation projects have included a multimillion-dollar study of forgiveness, and a two-year study to demonstrate the effect of prayer on 600 patients about to undergo surgery.
Many critics contend that reconciling science and religion is not possible, and that studies to that end are naïve, quixotic or motivated by a desire to put religious beliefs on an equal footing with scientific knowledge.
But others defend the foundation's approach, insisting that science has no monopoly on truth and that religion and science can cooperate productively.
"We have somehow to break down the barriers between our contemporary culture of science and disciplined academic study" and "the domain of the spirit," the philosopher John Taylor said in accepting the prize in 2007.
John Marks Templeton was born on Nov. 29, 1912, in Winchester, a small Tennessee town 60 miles from Dayton, the scene of the 1925 Scopes "monkey trial" pitting Clarence Darrow and William Jennings Bryan in a battle over the theory of evolution versus fundamentalist views of the Creation. The boy was only 12 then, but issues in the case dominated his later life; he wrote at least eight books on spiritual matters.
He was raised in a devout household and was the first student in town to go to college. Supporting himself at Yale in the Depression, he graduated near the top of his class in 1934, won a Rhodes Scholarship to Balliol College at Oxford University and earned a master's degree in law. He began his Wall Street career in 1937.
That year, he married the former Judith Folk. The couple had three children. His wife died in 1951. In 1958, he married Irene Reynolds Butler, who died in 1993. His daughter, Anne Templeton Zimmerman, died in 2005, and a stepson, Malcolm Butler, died in 1995. He is survived by two sons from his first marriage, John M. Jr., of Bryn Mawr, Pa., a retired surgeon and the chairman and president of the Templeton Foundation, and Christopher, of Colfax, Iowa; a stepdaughter, Wendy Brooks, of Delray Beach, Fla., and three grandchildren and three great-grandchildren.
Among his many gifts was the 1984 endowment of Templeton College, a business and management school at Oxford. In 1987, he was knighted by Queen Elizabeth II for his philanthropies. After many years on Wall Street, he renounced his American citizenship in the 1960s, became a British subject and moved to the Bahamas, a Commonwealth nation that has long been a tax haven.
Sir John said his investment record improved after he distanced himself from Wall Street and no longer worried about the tax consequences of his decisions. He was an early investor in Japan in the 1960's and later in Russia, China and other Asian markets. He sold large holdings before the technology bubble burst in 2000, and warned several years ago that real estate prices were dangerously high.
In Nassau, his net worth swelled into the billions, but his lifestyle remained relatively modest. He drove his own car and spent his days reading, writing and managing his foundation. Visitors were given sandwiches, tea and courtly advice in the afternoon at his white-columned antebellum home on Lyford Cay, set on a hillside lush with citrus trees and bougainvillea, overlooking a golf course and the ocean.
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