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Oct. 3, 2011 at 1:33 PM   |   Comments

Greece again bedevils stocks

NEW YORK, Oct. 3 (UPI) -- U.S. markets started fourth-quarter trading with losses after Greece said it would fall short on financial goals necessary for continued international loans.

Greece said it would miss the target of reducing its deficit to 7.6 percent of the gross domestic product this year, hitting 8.5 percent, instead, Britain's Guardian reported.

In early afternoon trading Monday, the Dow Jones industrial average lost 184.44 points, 1.69 percent, to 10,728.90. The Standard & Poor's 500 index lost 22.15, or 1.96 percent to 1,109.27. The Nasdaq composite index shed 53.09 or 2..20 percent to 2,362.31.

The benchmark 10-year treasury note rose 15/32 to yield 1.867 percent.

The euro fell to $1.3318 from Friday's $1.3387. Against the yen, the dollar fell to 76.74 yen from Friday's 77.04 yen.

In Tokyo, the Nikkei 225 index lost 1.78 percent, 154.81, to 8,545.48.


Greece to miss debit goal, cut 30,000 jobs

ATHENS, Greece, Oct. 3 (UPI) -- Greece will miss this year's deficit target by $2.4 billion, the government said, vowing to fire thousands of workers to meet international creditor demands.

"I want to repeat that we will be unswerving in our goal -- to fulfill all that we have promised to ensure the credibility of our country," Prime Minister George Papandreou told an extraordinary Cabinet meeting Sunday to approve a 2012 draft budget as well as the job-cut plan, which calls for identifying about 30,000 public workers who will be put on reduced pay and then either retire early or be fired.

The draft budget includes about $8.8 billion in new austerity measures, which Greece agreed to take this year and next to bring its budget back on track.

The budget was to be introduced in Parliament Monday and voted on by the end of the month.

The job-cut plan, to be carried out immediately, is projected to save $400 million starting next year and is the first step in a plan to eliminate 100,000 public-sector jobs by 2015, government officials said.

About two-thirds of the workers put into the special reduced-pay labor reserve will be taken from employees within a year or two of retirement, the officials said.

Finance ministers of the 17 countries that use the euro as their currency were to meet in Luxembourg Monday to discuss Greece's reform progress.

Greece's Finance Ministry said after the Cabinet meeting Greece's deficit this year would be about 8.5 percent of gross domestic product, or about $25.2 billion, compared with its 7.6 percent target, or about $22.8 billion.

Greece's 2012 deficit target is 6.8 percent of GDP, or about $19.5 billion.

The European Union, International Monetary Fund and European Central Bank -- known collectively as the troika -- had called for the deficit to be 6.5 percent of GDP.

The finance ministry said the missed target was a result of a deeper-than-expected recession.

Greece's economy is forecast to shrink 5.5 percent this year, deeper than the 3.8 percent the EU and IMF forecast in May, the ministry said.

The deficit could get even worse this year if the new austerity measures are not all implemented, it said.

"The final estimate for a deficit equal to 8.5 percent of GDP can be achieved if there is a proper response by the state authorities and the citizens themselves, on whose stance the country's financial ... and social future depends," the ministry said in a statement.

In the past few weeks, Greece has seen almost daily work stoppages by groups ranging from doctors and teachers to taxi owners and bus drivers, The Wall Street Journal reported.

Public-sector employees planned a nationwide strike Wednesday, and Greece's two largest umbrella unions planned a 24-hour general strike Oct. 19.


ABC News and Yahoo! form partnership

NEW YORK, Oct. 3 (UPI) -- ABC News and Yahoo! have formed an alliance that will strengthen their news operations, the two companies said in an announcement Monday.

"This new venture blends ABC News' global news gathering operation and unrivaled lineup of trusted anchors and reports with Yahoo! News' unmatched audience, depth and breath of content," a statement said.

Ross Levinsohn, executive vice president of Americas at Yahoo! called the partnership a "deep collaboration" that "further strengthens Yahoo! As the no. 1 online news source, greatly enhancing our already robust news content."

The alliance began with the launch of a three new video series, including "Newsmakers," which was to begin Monday with George Stephanopoulos interviewing President Barack Obama. It was to be streamed live at ABCNews.com and Yahoo.com simultaneously.

The two other programs ready for launch are a news show called "Around the World with Christiane Amanpour and "This Could Be Big," a news show hosted by Bill Weir that will feature technology news.


Citibank in Japan faces possible sanctions

TOKYO, Oct. 3 (UPI) -- Citibank Japan President and Chief Executive Officer Darren Buckley apologized for the bank's third regulatory lapse since 2004, the Yomiuri Shimbun reported.

The Financial Services Agency has yet to announce sanctions against the bank for allegedly overlooking potential money-laundering bank accounts, the Yomiuri Shimbun reported Monday. But sanctions are expected soon, the news agency said.

Buckley apologized at a news conference, saying the bank's audit system failed to detect the problems, the report said.

The bank had its licenses revoked in 2004 and was ordered to forgo solicitation of new clients for a month in 2009 on similar allegations.

It is possible regulators could ask for the bank to suspend operations to make organizational changes that would comply with regulations, the report said. The bank is expected to file a report soon that regulators will review before assigning a penalty.

© 2011 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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