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Complaints against bankers on rise

The ombudsman for the financial sector says consumer complaints hit their highest on record last year, driven by a sharp increase in disagreements on the investment side. The Ombudsman for Banking Services and Investments, the national body that resolves disputes for consumers and small businesses, said today complaints rose 48 per cent last year from the year before, to 990. That means the number of cases filed has tripled over three years, it said. Complaints against banks rose 21 per cent while those related to investments surged 73 per cent.

Last year's complaints were the highest since the group was formed as the Canadian Banking Ombudsman in 1996. It is an independent agency set up by players in the financial sector.

"The global economic crisis, coupled with sharp declines in financial markets, gave rise to much of the increase in complaints we saw," Ombudsman Douglas Melville said. "However, despite the improvement in markets over the last year, complaint volumes remain high. We expect this to continue."

Gold price to rise, UBS forecasts

Gold has become the "ultimate currency," UBS AG said today in a report that projects prices will hit $1,500 (U.S.) an ounce in the next 12 months and says anything below $1,200 represents a buying opportunity. "Since 2001 the price of gold has been on a relentless ascent against all major currencies," UBS said. "With confidence in paper currency systems badly shaken in the financial crisis, gold, it seems, is reasserting its old role as the ultimate debt-free money ... Our gold model also indicates that concerns over the future of major monetary systems are becoming visible in the price of gold."





Gold pushed to a record above $1,250 an ounce yesterday, though fell back later in the day and dipped again today.

Noting that some 166,000 tons of gold are now held above ground, and that the metal is "virtually indestructible" and never really consumed, UBS said there's no risk that the world will exhaust its supply. Mining produces most of the "new" gold, but that process is capital intensive and slow to respond to price changes, it said, and because the world's gold stock is unavailable on the market, shifts in supply and demand heavily dictate the outlook for prices. "Against a broad basket of all major currencies, we note that gold's value has remained remarkably stable over long periods of time," UBS said.





BP shares slip again

Shares of BP PLC fell again today as investors continue to fret over the possibility the energy giant will be forced to kill its dividend amid mounting costs from the oil spill in the Gulf of Mexico and intense political pressure in the U.S. to scrap the payout. Investors are also gearing up for a Senate hearing in Washington on offshore drilling safety. U.S. Interior Secretary Ken Salazar is scheduled to testify.

Related: Obama turns up heat on BP's Hayward

Fears of threats to tourism

There are also growing fears in Florida of the threat to the summer tourism season as tar balls wash up in the Panhandle. Bloomberg News reports today that tourism is already being hurt, and real estate sales are suffering. The area's banks, hurt badly by the subprime mortgage meltdown, are now being hit by economic fears related to the oil leak from the Deepwater Horizon drill rig disaster in the Gulf, given Florida's reliance on tourism. Shares in banks such as Regions Financial Corp. and Synovus Financial Corp. have slumped since the rig exploded April 20 amid investor fears that the Gulf Coast economy will be hurt.

Economic concerns have spread as far south as Florida's Sanibel Island, though the spill is nowhere near there. The Sundial Beach and Golf Resort on the island is promising guests that its beaches will be "oil and tar ball free" during their stay or their money will be refunded.

Chinese market surges

Chinese stocks surged today, pulling world stocks and some metals along with them, on a report from Reuters that data will show China's exports soared about 50 per cent in May from a year earlier. That would be a strong signal for investors concerned that China's rapid economic growth is slowing. "Concerns about Spanish banks had European equities cooling off modestly earlier this morning, but early betting on tomorrow night's Chinese data releases is bullish particularly on the export side and serving to lift Chinese equities with spillover effects into Europe that are driving major bourses back into the black," Scotia Capital said.

The Dow Jones industrial average , the S&P 500 and the S&P/TSX composite all rose, and the Canadian dollar jumped to well above 96 cents U.S.

Related: Investor fears rise with debt crisis

Kevin Carmichael's G8/G20 Global View summit blog

Protests mount in China

Labour unrest is spreading in China, beyond the industrial region where it began. Citing a dangerous development for Beijing, the Financial Times reports violence today at KOK International in Kunshan, an industrial town in Jiangsu province, which follows the decision by Honda Motor Corp. to temporarily halt production at two auto plants because of work disruptions at feeder factories. The latest unrest, the newspaper said, indicates that work stoppages are growing faster than they can be resolved by regional governments. Read the story

Related

Honda faces more labour woes in China

China's low-cost workers have richer days ahead

China approves massive IPO

Chinese regulators today approved plans by Agricultural Bank of China to list in Shanghai and Hong Kong in an initial public offering pegged at more than $20-billion (U.S.). The bank, based in Beijing, is the last of China's major state-owned financial institutions to plot an IPO, The Associated Press reported. The IPO of as much as 53 billion shares comes despite market turmoil, and trading could begin by mid-July. Read the story

Merkel, Sarkozy urge reform

German Chancellor Angela Merkel and French President Nicolas Sarkozy are calling for urgent reforms to market regulations. Amid the turmoil in global financial markets, largely related to Europe's deepening debt crisis, the German and French leaders today wrote to European Commission President Jose Manuel Barroso saying they believe the market turbulence "raises some legitimate questions, specifically concerning certain financial techniques and the use of certain derivative products, as, for example, short selling and credit default swaps."

UBS upgrades Potash Corp.

UBS Securities Canada believes it's time to buy Potash Corp. of Saskatchewan stock again. Analyst Brian McArthur today upgraded the stock to "buy" from "neutral" and boosted his 12-month price target on the shares to $112 (U.S.) from $106 on estimates for higher production next year and "our belief that the potash market is improving." Potash Corp., he noted, is the world's biggest and lowest-cost publicly traded producer and its reserves are enough for more than 100 years of production. "We also note the potential for improving corn prices especially if China emerges as a substantial importer of corn, and/or there is an increase in the ethanol blend rate this summer," Mr. MacArthur said in a research report. "Corn is the primary fertilizer consuming crop in the U.S."

From today's Report on Business

Bankers cast doubt on tax alternative

Apartments: Slow, steady and sizzling hot

Will making lawyers civil make them soft?

Cross-border fight simmers over tar sands

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 28/03/24 7:00pm EDT.

SymbolName% changeLast
BP-N
BP Plc ADR
+0.59%37.68
HMC-N
Honda Motor Company ADR
-0.24%37.23
RF-N
Regions Financial Corp
+1.74%21.04
SNV-N
Synovus Financial Corp
+0.6%40.06

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