What are sovereign funds?

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Concerns grow about the wash of money coming from governments buying into Western assets. A report from the Newsnight team.

U.K. to Back Northern-Rock Debt

The U.K. government, struggling to find a buyer for Northern-Rock, said it will guarantee a sale of bonds backed by the bank's home-loans.

Mortgages, consumer loans and some investment-grade securities of the Newcastle, England-based bank would be packaged as debt and sold to investors, the Treasury has said. Northern Rock rose 46 percent in London trading on speculation the proposal will revive interest among potential buyers such as Richard Branson's Virgin-Group.

Via Money-Soft

Brown in India

Britain and India should step up cooperation in the fight against terrorism and work together to isolate militants, prime-minister Gordon-Brown said on Sunday. Brown, on his first visit to India as prime minister, said he would like to see India join an international body that fights money laundering and terrorist financing, the Paris-based Financial Action Task Force.

"What I would like to see is greater contact between our two countries in winning the battle of hearts and minds, isolating extremist ideologies who try to poison young people," Brown told a news conference.

Aid-Pledge
Brown arrived bearing promises of hundreds of millions of dollars of development aid to combat poverty in India, where 400 million people live on less than $1 a day despite the country's rapid economic-growth.

Britain said that over the next three years it will give India £825 million in development aid, with more than half spent on health and education.

Via Yahoo! News

Brown heads to India

Gordon-Brown is due to arrive in India on the second leg of his trip to promote stronger links with two of the world's fastest-growing economies.

The prime minister is using his visits to China and India to promote better trade agreements with the UK, which he says will create new jobs.

Mr Brown told the BBC there needed to be "greater co-operation between the major countries in the fight against terrorism" and said China, Pakistan and India all had a part to play.

What we need is a comprehensive action plan - Prime Minister Gordon Brown.

Via BBC

Branson campaigns for Northern Rock

Richard-Branson boasted today that his Virgin empire has created a "winnable package" to take control of Northern-Rock.

"I believe it's the best option because we would re-brand it the Virgin-Bank, which is a very strong brand ... We feel we have a winnable package." Said Brandson.

As Alistair-Darling prepares to unveil the plan to MPs, Branson used his place on the prime minister's high profile Far-East trip to intensify his campaign.

The prime-minister said: "I haven't spoken in any detail to Richard Branson. The commercial decisions are not a matter for me."

Via Guardian-Unlimited

London Base for China's $200 Bln-Fund

U.K. Prime Minister Gordon Brown has offered London as an overseas base for China's $200 billion sovereign wealth fund, aiming to encourage the world's fastest- growing major economy to invest in Britain.

Video > What are sovereign funds?

The economy of the world's most populous nation overtook the U.K. in 2005, and Britain's trade with China may grow 50 percent to $60 billion by 2010, according to a goal set today by Brown and Chinese Premier Wen-Jiabao.

"We can now sell China not just financial services, but also a whole range of British brands that are becoming very popular among the Chinese consumers," Brown said at a press conference during his first China trip as prime minister.

Via Bloomberg

"Dithering" Mr. Brown

The prime-minister has been accused of "dithering" with Northern-Rock.

Tory leader David-Cameron suggested he had been advised to sell the troubled-bank, but had delayed because he was planning an election.

You dithered and delayed, why did you dither and delay? Because you were planning a general election - David Cameron

Via BBC

Cameron criticises Rock 'failure'

Conservative leader David Cameron has said that nationalising Northern Rock would be "the most complete humiliation and failure for the government".

Speaking on the Andrew Marr show, Mr Cameron criticised the government's handling of Northern Rock. Mr Cameron also alleged that advice from City advisers to sell Northern Rock had been ignored for political reasons.

Via BBC

JPMorgan buys Northern-Rock assets

Northern-Rock yesterday sold off £2.2bn ($4.3bn) of mortgage assets to JPMorgan, the US investment bank.

The stricken-bank, which owes £25bn to the Bank of England, yesterday sold off its equity release mortgage book for a small premium of £50m.

Via FT

Energy firms make £1bn

Energy companies have been accused of overcharging-customers by more than £1 billion. Millions of households are paying an estimated £200 a year over the odds for fuel, because firms are quick to pass on price-increases when their costs rise. The comparison firm uSwitch says, suppliers withheld £177 in price-cuts from every household in Britain last year. Last week Npower, Britains fourth-largest supplier with 6m customers, raised the price of gas by 17.2% and electricity by 12.7%, blaming the rise in energy costs. Npower, whose average dual-fuel bill now costs more than £1,000 a year, did not start cutting tariffs - a year after prices started falling.

Via Sunday-Times