Berkshire Hathaway derided for deal
Warren Buffett’s Berkshire Hathaway has been branded “foolish” by an insurance executive for blindly following underwriting decisions taken by Lloyd’s of London rivals. An unusual deal that Berkshire has struck with the insurance broker Aon is likely to “end in tears”, warned Richard Brindle, founder and chief executive of FTSE 250-listed insurer Lancashire. Lloyd’s officials have complained that the arrangement – in which Aon has begun to allocate a chunk of all business it places at the historic market to Berkshire – threatens to undermine underwriting expertise.
Detroit’s troubles come to light
Detroit’s problems stem from the city’s decision in 2005 to take on $1.4bn (£900m) of debt in an attempt to top up its two underfunded pension funds for city employees, trying to fix shortfalls with more and more complex financial deals.
Probe into Spanish train crash begins
Spain on Thursday declared three days of national mourning for the victims of the disastrous rail crash near the pilgrimage city of Santiago de Compostela, amid claims that the train was travelling twice as fast as allowed when it derailed and smashed into a concrete wall. Two inquiries were launched
Germans get top marque for engines
Aston Martin has turned to the Germans to make the latest of its high-performance engines, and the Mercedes-Benz group Daimler is set to end up with a small stake in the quintessentially British luxury sports car brand as a result.
Eurotunnel battles under the sea
The French chief of Eurotunnel has confessed that the Channel tunnel operator is working in a “hostile environment” with Eurostar but dismissed as “bull****” claims from its main customer that it was being ripped off.
The Daily Telegraph
Ageing UK pushes welfare to crisis
Despite ministers’ claims that welfare costs are being brought under control, figures show that the coalition has failed to cut the UK’s benefits bill. In a report released tonight, the Organisation for Economic Cooperation and Development said that the proportion of GDP spent on jobseekers’ allowance, pensions and other “public social spending” stood at 23.8 per cent, the same as it was in 2010. The think tank warned that unless action was taken to cut the cost to the state of Britain’s rising elderly population, the health and pensions systems could collapse.
THE WALL STREET JOURNAL
Singapore Airlines profit up on gain
Singapore Airlines yesterday reported a 56 per cent rise in fiscal first quarter net profit, lifted by gains from the sale of its stake in Virgin Atlantic Airways. The airline said its net profit for the second quarter rose to 121.8m Singapore dollars.
Penguin placates EU over e-books
Penguin has made a satisfactory offer to the EU’s antitrust watchdog after its investigation into distorted pricing of electronic books in Europe, the European Commission said yesterday.