For the first time since the start of 2008, bonds were the only investments to provide positive returns amid renewed concern the global economy is slowing and as widening deficits in Europe threaten contagion.
Fixed-income assets — from Australian government debt to U.S. Treasuries to global junk bonds — gained 0.7 percent last month including reinvested interest, according to Bank of America Merrill Lynch index data. The MSCI All-Country World Index of stocks lost 1.1 percent including dividends while the Standard & Poor
Anonymous and other "hacktivist" groups rose to new prominence in the cybercrime universe last year, and a new report shows that they made some serious mischief.
Verizon’s (, Fortune 500) annual Data Breach Investigations Report, released Thursday, found that hacktivist groups were responsible for 58% of all data stolen last year. The telecom giant compiled data breach information from its customers and from law enforcement agencies in five countries.
The hacktivists’ success is partially due to the sharp rise in the number of attacks Anonymous and its peers launched last year. Verizon, which has been tracking hacktivist activity since 2004, said that last year’s collection of hacktivist breaches exceeded the total from all previous years combined.
That trend is "probably the biggest and single most important change" in this year’s report, said Bryan Sartin, head of Verizon’s data breach investigations team.
When online hacktivism first started in the 1990s, most of what the attackers accomplished were website defacements and denial of service attacks — annoyances more than serious problems.
How they hack you
But last year, Verizon began to notice what it calls a "major shift" in hacktivist activity. In addition to their usual methods, Anonymous and its cohorts were starting to launch data breach attempts against their targets, in what became a new "core tactic" for the groups.
"2011 saw a merger between those classic misdeeds and a new ‘oh by the way, we’re gonna steal all your data too’ twist," Verizon said in its report. "This re-imagined and re-invigorated specter of ‘hacktivism’ rose to haunt organizations around the world."
Here’s a startling twist: Verizon found that in many cases the denial of service attacks served as diversions. The hacktivists would often publicly announce a big attack, and the target would dedicate all of its resources to stopping that. While that was happening, hacktivists would go in unnoticed and steal some company data.
"It’s the old bait-and-switch," said Sartin. "That concept, as basic as it seems, is a level of ingenuity we’ve never seen before."
In all, hacktivist groups stole more than 100 million records last year, almost twice the amount of data captured by financially motivated cybercriminals payday loans with no fax.
Still, just 2% of all attacks could be attributed to Anonymous and its peers. The vast majority of online data thieves remain professional criminals looking to steal information that can lead to money.
The cost of cybercrime
So why did hacktivists manage to grab so much more data than the pros?
Those big-time cybercriminals — typically organized crime rings — are usually surgical in their attacks. They take a "rinse and repeat" approach, stealing small chunks of data on a massive scale.
Hacktivists, on the other hand, go after big organizations, since their goal is to get the public to notice them. Some prime targets of Anonymous and other hacktivists last year included News Corp. (), Sony (), PBS, the Federal Bureau of Investigation, Central Intelligence Agency, Department of Justice, and a multitude of security firms.
The "good" news is that most of what hacktivists stole was relatively benign data. Customer lists of names, usernames and e-mail addresses were the most commonly grabbed data. Hackers were rarely able to capture — or perhaps didn’t go after — more sensitive data like credit card information or passwords.
But it wasn’t all "protest and lulz," Verizon said. Sartin now thinks that hacktivists are a more significant threat than previously believed.
Fighting the cyber Mafia
"The numbers suggest clearly that people need to reevaluate how they view the capabilities of hacktivists," he said. "The tools, tactics and methods of advanced persistent threats and hacktivists are largely the same."
Traditional cybercriminals are also upping their game.
Cybercriminals last year went after end-user devices like ATMs, laptops and smartphones much more often than they did in previous years. Those devices accounted for 60% of all attacked targets, and Sartin said he wouldn’t be surprised if smartphones make up the majority in 2012.
In all, Verizon said it and its partners recorded 855 data breaches, encompassing 174 million compromised records. That represented the second-highest total since Verizon’s report was first issued in 2004.
Direct Energy is changing its water heater rental contracts and making it more expensive for customers to switch suppliers or buy their own units.
Right now, customers can remove rented water heaters any time at no cost. They may pay a $75 fee if they want Direct Energy to disconnect, remove and retrieve the tank.
But under new contract terms to start April 2, customers who cancel their rental contracts will pay a buyout fee ranging from $100 to $1,000 or more, depending on the unit
Efforts to find a diplomatic solution to Iran’s disputed nuclear program appeared to get a boost Tuesday when world powers agreed to a new round of talks with Tehran, and Iran gave permission for inspectors to visit a site suspected of secret atomic work.
The two developments appeared to counter somewhat the crisis atmosphere over Iran’s nuclear program, the focus of talks in Washington between President Barack Obama and Israel’s visiting prime minister.
EU foreign policy chief Catherine Ashton said the five permanent members of the U.N. Security Council and Germany agreed to a new round of nuclear talks with Iran more than a year after they ended in failure. Previous talks have not achieved what the powers want _ an end to uranium enrichment on Iranian soil.
The U.S. and its allies say Iran is on a path that could eventually lead to the production of a nuclear weapon. Iran denies that, insisting that its program is for energy production and other peaceful purposes.
Ashton said in a statement that the EU hopes Iran “will now enter into a sustained process of constructive dialogue which will deliver real progress in resolving the international community’s long-standing concerns on its nuclear program.”
The time and venue of the new talks have not been set.
In Washington, National Security Council spokesman Tommy Vietor said Iran must comply with U.N. Security Council resolutions and stop uranium enrichment. “We still believe diplomacy coupled with strong pressure can achieve the long-term solution we seek,” he said in a statement.
Britain’s foreign secretary, William Hague, said in a statement that the onus would “be on Iran to convince the international community that its nuclear program is exclusively peaceful.”
German Foreign Minister Guido Westerwelle called for a diplomatic solution. “A nuclear-armed Iran must be prevented,” he said.
Ashton was responding to a February letter from Iranian nuclear negotiator Saeed Jalili, in which he proposed new discussions.
This week Obama warned the U.S. would use military action to protect its interests if necessary, while appealing for time for sanctions against Iran to show their affects. In his public statements during a visit to Washington, Israeli Prime Minister Benjamin Netanyahu thanked Obama for his support but did little to counter concerns that Israel might go ahead on its own with an attack on Iran. Israel considers Iran an existential threat because of its nuclear program and its references to destruction of the Jewish state low fee payday advance.
The U.N.’s International Atomic Energy Agency last year published a report that included what it said was evidence of Iranian activity that could be linked to weapons development. The head of the IAEA, Yukiya Amano, said Monday that his organization has “serious concerns” that Iran may be hiding secret atomic weapons work, singling out the Parchin military complex southeast of Tehran.
On Tuesday, Iran appeared to respond partially to those concerns, granting long-sought permission to IAEA inspectors to visit the Parchin compound. Iran describes the site as a military base, not a nuclear facility.
The semi-official ISNA news agency stated a key condition: such a visit would require an agreement between the two sides on guidelines.
“Given that Parchin is a military site, access to this facility is a time-consuming process, and it can’t be visited repeatedly,” ISNA quoted the Iranian statement as saying. It added that following repeated IAEA demands, “permission will be granted for access once more.”
Inspecting Parchin was a key request by senior IAEA teams that visited Tehran in January and February. Iran rebuffed those demands at the time, as well as attempts by the nuclear agency’s team to question Iranian officials and secure other information linked to the allegations of secret weapons work.
The Parchin complex has been often mentioned in the West as a suspected base for secret nuclear experiments _ a claim Iran consistently denies. IAEA inspectors visited the site in 2005, but only one of four areas on the grounds, reporting no unusual activities.
Last year, IAEA’s report said there were indications Tehran has conducted high-explosives testing to set off a nuclear charge at Parchin. Iran denied the atomic activity and insisted that any decision to open the site rests with the armed forces.
“We have our credible information that indicates that Iran engaged in activities relevant to the development of nuclear explosive devices,” Amano said told reporters Monday outside a 35-nation IAEA board meeting in Vienna, describing his sources as “old information and new information.”
Tehran has dismissed the charge, saying it was based on “fabricated documents” provided by a “few arrogant countries,” a phrase Iranian authorities often use to refer to the U.S. and its allies.
Greece’s Parliament late on Tuesday approved new cuts in public sector pensions and government spending required to secure a second package of international rescue loans.
Lawmakers voted 202-80 in favor of cutbacks worth a total euro3.2 billion ($4.31 billion) and aimed at bringing the 2012 budget back in line with targets. Lawmakers from both parties in Prime Minister Lucas Papademos’ coalition, the majority Socialists and the conservatives, backed the legislation.
Earlier, the debt-crippled country’s Cabinet decided to apply recent labor reforms, including deep cuts to the minimum wage, retroactively to Feb. 14.
Greece is obliged to adopt a series of austerity measures and reforms before it can receive any funds from its new euro130 billion ($174 billion) package of rescue loans from other eurozone countries and the International Monetary Fund.
The bailout, and accompanying bond swap deal with private creditors, are meant to save the country from a potentially catastrophic default in late March that could drag down other financially vulnerable countries and threaten the European Union’s joint currency, the euro.
The rescue package is Greece’s second in less than two years. The country has been surviving since May 2010 on funds from a first bailout from the eurozone and IMF, and has received euro73 billion ($98 billion) from the initially approved euro110 billion ($147 billion) package.
But more than two years of harsh austerity implemented to secure the rescue funds have taken a hefty toll on the recession-bound Greek economy, with businesses closing in the tens of thousands and unemployment at a record high 21 percent.
“It is dramatic to cut someone’s pensions. … But why do we have to take these measures? Because our budget is still running at a loss,” Finance Minister Evangelos Venizelos said in Parliament. “We are still adding debt to our debt. And if we do not start to generate a primary surplus next year, that will be catastrophic.”
The newly approved legislation imposes nearly euro400 million ($538 million) in cuts to already depleted pensions.
Health and education spending will be reduced by more than euro170 million ($229 million), subsidies to the state health care system will be cut by euro500 million ($673 million), and health care spending on medicine will fall by euro570 million ($767 million).
Furthermore, some euro400 million ($538 million) will be lopped off defense spending _ three quarters of which will come from purchases.
The law also revises the 2012 budget, changing the government deficit target to 6.7 percent of gross domestic product from an initial forecast of 5.4 percent.
Measures approved by Papademos’ Cabinet earlier Tuesday include a 22 percent cut in the minimum salary, currently at euro751 ($1,010) per month, for private sector workers, and a 32 percent cut for workers under the age of 25, where the rate of unemployment is nearly 50 percent.
Limits also are being imposed on collective wage agreements and the process of labor arbitration, with some measures to remain in effect until overall unemployment falls below 10 percent.
Lawmakers are to vote again on Wednesday on another bill implementing cuts that have previously been announced.
The new wave of austerity measures have sparked widespread anger among a public that has seen its income and living standards drop with no clear end to the crisis in sight.
On Tuesday, about 100 uniformed police, coast guard and fire service unionists protested pay cuts outside Parliament, with a small group burning a wartime military German flag used in the Nazi era in 1935-1945. While Germany is a major contributor to both Greek bailouts, Berlin’s insistence on an austerity-based cure for the country’s financial woes has angered many Greeks.
Papademos, a technocrat heading Greece’s temporary coalition government, is to head to Brussels for a meeting Wednesday with European Commission chief Jose Manuel Barroso.
Greece’s European partners have been pressing the country to implement the measures it has already passed, after repeated delays and missed targets over the last two years eroded trust in the ability of Greece’s politicians to stick to their pledges.
European Parliament President Martin Schulz was in Athens on Tuesday for a series of meetings, and he gave a speech in Parliament stressing that “Greece must remain in the euro.”
“We must do everything we can to prevent the collapse of the euro,” he said, adding that more emphasis must be put on measures to promote growth rather than only on cutbacks.
“A policy based solely on austerity spells economic disaster,” he told Greek deputies.
“Budgetary prudence is certainly essential (but) … there is too much focus on financial penalties and austerity packages,” Schulz said, adding that economic growth could be stifled in many European countries.
“How are countries whose economies are at a standstill, which are facing a recession, supposed to pay off their debts? Greece has already paid a high price. It cannot go on paying,” he said.
On Monday, the Standard & Poor’s ratings agency downgraded Greece’s credit rating to “selective default” over a debt writedown deal with private creditors that is an integral part of the second bailout.
The downgrade had been widely expected, as ratings agencies had said the bond swap with private creditors, which seeks to cut euro107 billion ($144 billion) off Greece’s debt, would constitute a selective default. Once the swap is carried out next month, the agencies are expected to upgrade Greece.
Late Tuesday, the International Swaps and Derivatives Association said it has accepted for consideration a question relating to a potential credit event with respect to Greece. An ISDA statement said a meeting will be held at 1100GMT on Thursday to determine whether a credit event has occurred.
The decision by the New York-based trade association, which represents hundreds of banks and other companies, will ultimately determine whether the bond swap will trigger payment of insurance taken by investors against a Greek default.
____
Derek Gatopoulos and AP Television in Athens contributed.
China
Australian house prices plunged by the most on record in 2011 as global economic uncertainty and concerns about its impact at home kept a lid on demand.
An index measuring the weighted average of prices for established houses in eight major cities slid 4.8 percent from a year earlier, according to the Australian Bureau of Statistics, the biggest calendar-year drop since the data began in March 2002. They fell 1 percent in the three months to December from the previous quarter, when they retreated a revised 1.9 percent. The median estimate of 15 economists surveyed by Bloomberg News was a 0.6 percent quarterly fall.
Reserve Bank of Australia Governor Glenn Stevens lowered the benchmark rate by a quarter percentage point on Nov. 1 and again on Dec. 6 as inflation pressures eased and global growth risks increased. Australia recorded its worst annual job growth in 19 years in 2011, as consumers boosted savings, and traders are pricing in a 60 percent chance of another cut next week.
President Obama gave a pep talk Friday to the staff of the Consumer Financial Protection Bureau — including the new director he controversially appointed this week.
"Every one of you here has a critical role to play in making sure that everybody’s playing by the same rules — to make sure the big banks on Wall Street play by the same rules as community banks on Main Street," Obama said.
The bureau is likely to face a bumpy road after the president’s recess appointment of Richard Cordray, a former Ohio attorney general, as the bureau’s first official director.
Obama’s move angered Republicans in Congress who had tried for months to prevent the president from making exactly that appointment unless he agreed to structural changes in the consumer bureau. They say the bureau — which came into existence last year as part of the Dodd-Frank financial reforms — is unaccountable and they deny the legitimacy of the appointment, saying Congress isn’t in recess.
The administration counters that the pro-forma sessions aimed at blocking the recess appointments aren’t legitimate, and that the president has a Constitutional obligation to appoint people to keep government running.
A House Republican panel has called Cordray to testify later this month. And business groups are talking about a legal challenge to the bureau’s authority.
The Consumer Financial Protection Bureau is an independent agency created as part of the Wall Street reforms of 2010 tasked with regulating financial products such as mortgages and credit cards bad credit payday loans.
As its new chief, Cordray has said he plans to move forward and not worry about potential lawsuits that may challenge his agency’s powers.
In his address on Friday, Obama praised the bureau for moving forward to target nonbank firms that issue financial products such as payday lenders, debt collectors and mortgage servicers — sectors that remained unregulated while the bureau lacked an official director.
"Now that Richard is your director, you can finally exercise the full powers that this agency has been given under the law," Obama said. "No longer are consumers left alone to face the risk of unfair or deceptive or abusive practices. Not any more."
Obama gave a "special shoutout" to Elizabeth Warren, the Harvard University professor who came up with the idea of the bureau. The White House bypassed Warren, a critic of the banking industry and lightning rod to Republicans, in favor of nominating Cordray to run the bureau. Warren is now running for the U.S. Senate.
The mention of Warren’s name drew big cheers from the crowd of 100 employees attending the speech at the main offices of the bureau, which now has a staff of around 800.
European confidence in the economic outlook fell to the lowest in more than two years and German factory orders plunged as the euro area
Brazil’s second largest airline says it has agreed to sell a minority stake in the company to Delta Air Lines.
GOL Linhas Aereas Inteligentes SA says in a regulatory filing with the Brazilian Securities and Exchange Commission on Wednesday that Delta Air Lines Inc. will pay $100 million for a “strategic minority interest” of GOL’s preferred shares.
Gol says the investment will be in the form of American Depositary Shares.
In February, Atlanta-based Delta and Gol entered into a code-sharing agreement that enable Delta to sell seats on 56 GOL flights between Rio de Janeiro or Brasilia and 15 Brazilian destinations.
(This version CORRECTS airline as Delta Air Lines)
Powered by WordPress -- XHTML 1.0