Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

These are stories Report on Business is following Tuesday, Sept. 30, 2014.

Follow Michael Babad and The Globe's Business Briefing on Twitter.

Europe suffers
These are dark days for continental Europe.

Story continues below advertisement

Unemployment remains painfully high, while inflation is edging down ever closer to zero, according to the latest statistics today, adding more pressure to central banks poised to meet on Thursday.

And digging beneath today's headline numbers shows something even more troubling: Several countries face the prospect of a lost generation as unemployment among young people surges.

By the numbers:

  • Unemployment among the 18 nations that make up the troubled euro zone held at 11.5 per cent in August, according to the statistics agency Eurostat. In the wider European Union, the jobless rate dipped to 10.1 per cent from 10.2 per cent.
  • Almost 25 million people can’t find work in the EU, more than 18 million of them in the euro zone.
  • Greece and Spain continue to have the highest unemployment in the region, at 27 per cent and 24.4 per cent, respectively.
  • Austria and Germany, at 4.7 per cent and 4.9 per cent, enjoy the lowest.
  • Among young people, unemployment now stands just slightly below that of July’s level, at 21.6 per cent in the EU and 23.3 per cent in the euro zone.
  • More than half the youth work force in Greece and Spain is jobless. And in Italy, youth unemployment is now running at more than 44 per cent.
  • Even in the stronger nations of Germany, Austria and the Netherlands, unemployment is still high.

At the same time, deflation fears are being fanned by consistently low inflation, which Eurostat pegged at 0.3 per cent this month, down from August's 0.4 per cent.

Just yesterday, as The Globe and Mail's David Parkinson reports, a major new report warned of the danger of slow economic growth and low inflation across the globe.

Today's numbers add even more pressure on chief Mario Draghi's European Central Bank, which meets Thursday after having cut interest rates twice now.

"The euro came in for a bashing again this morning, as inflation pushed further to the downside, increasing the validity of calls for the introduction of a fully blown asset purchase scheme by the ECB," said research analyst Joshua Mahony of Alpari in London.

Story continues below advertisement

"Mario Draghi has been fighting against the plummeting rate of CPI, which has been falling since the beginning of 2012 when it peaked out at 3 per cent," he added.

"Today's fall to 0.3 per cent was thus far from unexpected, however the continuation of this downward trend in prices makes for worrying reading and proves to the markets that all the measures introduced so far have been completely ineffective at bringing about price stability or higher growth within the region."

Mr. Mahony also pointed to today's separate reading from powerhouse Germany, where the jobless rate held steady but the number of unemployed rose for the month in a row.

"Over all, this continued weakness in Germany, accompanied by an incessantly falling inflation rate, means that Mario Draghi is being pushed into a corner to find the solution, and fast," he said.

eBay surges
The world of electronic payments is changing even faster, with the announcement today that eBay Inc. plans to spin off PayPal next year.

This follows Apple Inc.'s launch of an electronic payment system, and pressure from activist Carl Icahn, who has pressured eBay to break the company into two.

Story continues below advertisement

"A thorough strategic review with our board shows that keeping eBay and PayPal together beyond 2015 clearly becomes less advantageous to each business strategically and competitively," chief executive officer John Donahoe said in a statement.

"The industry landscape is changing, and each business faces different competitive opportunities and challenges."

Shares of eBay surged in the premarket hours, up by more than 11 per cent.

Auto makers in focus
Ford Motor Co. shares are flat-lining in premarket action so far this morning, after yesterday's plunge amid a profit warning, and as investors eye the American auto industry.

Ford stock was up just 0.2 per cent with about two hours to go before the New York open.

Yesterday, Ford shares tumbled as it projected at an investor conference that its pretax profit this year would come in at about $6-billion (U.S.), compared its earlier predictions of between $7-billion and $8-billion.

Story continues below advertisement

Ford, of course, was alone among the Detroit auto makers in escaping bankruptcy protection during the crisis.

At the same time, according to the Wall Street Journal, General Motors Co. chief executive officer Mary Barra is expected tomorrow to unveil the auto maker's strategy for the next few years.

Ms. Barra, whose company has been in the eye of a safety storm, told the news organization she would disclose her timelines.

Report an error Editorial code of conduct
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies