Monday, October 31, 2011
For the first time, Samsung Electronics Co. shipped more smartphones in the latest quarter than tech industry darling Apple Inc. On the surface, this may look like a big upset in a world that affords the iPhone maker adulation and outsized expectations. The real reason, however, has more to do with timing and Samsung's variety of offerings and prices.
Apple sold 17.1 million iPhones in the third quarter, 3 million fewer than expected. Samsung, meanwhile, shipped more than 27 million, according to analyst estimates.
So what happened? For one, Apple's latest iPhone, the 4S, didn't come out until the quarter ended, so its sales are not included in the figure. People held back on buying older models in anticipation of the new iPhone, which came out Oct. 14. Apple said it sold more than 4 million units in its first weekend on sale, and that should be reflected in the tally for the current, holiday quarter.
"People were waiting," said Francis Sideco, analyst with the research firm IHS. "We don't see this as a signal that Apple is all of a sudden losing its edge. It's their normal thing. But while they are doing this normal thing, Samsung is (going strong) and they happen to have a really good quarter."
Samsung's quarter was helped by strong sales of its Galaxy phones, though Sideco said the numbers shouldn't lead to the conclusion that the Samsung Galaxy beat the Apple iPhone.
"What beat it is Samsung's lines," Sideco said.
Besides the Galaxy line, Samsung's phones include Conquer, Replenish, Focus and Indulge. IHS estimates that Samsung sold about 40 different models during the third quarter. By comparison, Apple had just two - the 4 and the 3GS.
Samsung, which is based in Seoul, South Korea, does not disclose the number of phones it ships. IHS, formerly known as iSuppli, estimates that Samsung shipped 27.3 million smartphones in the latest quarter. Jae Lee from Daiwa Securities puts the figure at about 28 million.
Analysts cautioned against reading too much into the numbers, but such comparisons are tempting given the pedestal that Apple is held on and the fact that the rivalry between the two companies has heated up and extended into the courtroom. Apple says the product design, user interface and packaging of Samsung's Galaxy devices "slavishly copy" the iPhone and Apple's iPad tablet computer. Samsung fought back with lawsuits of its own, accusing Apple of patent infringement of its wireless telecommunications technology.
Even as Samsung sold more phones, Apple seems to be making more money on each. That's one of the reasons Apple is now the most valuable tech company in the world, with a market value about three times that of Samsung.
Apple competes on - and dominates - the high-end smartphone market. By contrast, Samsung has both cheap and expensive phones available. That means Samsung can appeal to a broader range of customers, but the company has to settle for a lower profit margin on lower-end smartphones.
Sideco called both strategies good. Good, but different.
Apple, which is based in Cupertino, Calif., limits the market it addresses because it is safeguarding its profit margin on the iPhone, said Gartner analyst Carolina Milanesi. More expensive phones mean higher margins for the company, which so far hasn't focused on the market for lower-end phones.
"It's part of their plan," Milanesi said. "If they wanted to capture a wider segment of the market, they would go with a lower-end device."
That could come soon. The price cut earlier this month for the iPhone 4 to $99 (down from $199) and the decision to offer now-ancient 3GS for free - with a two-year service contract - could mean that Apple is testing the waters in the cheaper market.
"The sales of the $99 iPhone 4 will definitely help widen the addressable market," Milanesi said.
When it comes to the overall mobile phone market, though neither Apple nor Samsung are on top. That honor goes to Nokia Corp. The Finnish company is still the world's No. 1 cellphone maker even though it has fallen behind rivals in the smartphone market. Nokia shipped 16.8 million smartphones during the third quarter, a close third to Apple, according to IHS.
Tuesday, October 25, 2011
Buying a sea facing house is everyone's dream, and if you are the one who is living this reality this festive season, then you might want to look at buying opportunities overseas.
And it is not that only tycoons can afford to buy houses at exotic locations.
Wealthy investors like Shashi Dubey have already set their sails westwards. He is looking at Dubai for this 3 BHK luxury apartment at the famous Marina Beach for just Rs. 40 lakh.
“It is better to buy property in Dubai as at the same price I get a better property and foreign investment than South Mumbai's cramped apartments,” said Shashi Dubey, MD of EMS Export.
Central bank allows investment of up to $200,000 abroad per person per year, and with global slowdown in property prices, there is a lot to pick and choose.
According to a recent report by KnightFrank India, in the June to August quarter of 2011, there is a global slowdown in the realty space by 1.8 per cent, but India bucks the trend with property prices up by around 7 per cent.
“We are seeing as more demand from regular middle class and not only the elite class – a typical family of 4 can put in $200,000 each per annum and buy a holiday home,” said Anand Narayanan, National Director – Residential Agency at Knightfrank.
But experts also have a word of caution. “Do your due diligence, paperwork and know the builder through reputed firms. Don’t put your money in ponzi schemes,” said Hem Taneja, CEO of grouphomebuyers.Com.
So, even as property prices heat up back home, global realty world calls the Indian investor, and he is ready to sail right away.
Sunday, October 23, 2011
EU leaders closed in on a broad agreement on Sunday to resolve the euro crisis and pressed Italy to slash its debt mountain to reassure jittery world markets.
A summit of EU leaders came together on plans to boost the firepower of the eurozone rescue fund -- the European Financial Stability Facility -- and backed plans to recapitalize banks who would be hit by a massive write-down of Greek debt.
They also agreed to explore a re-opening of the core European Union treaty to cover closer eurozone integration although non-euro states remain wary about moves that might leave them out.
For that reason, the bloc was forced to bring all 27 member states back for a second meeting on Wednesday to finalize a response to the debt crisis.
The second summit in four days was originally meant only to involve the 17 nations that share the euro single currency.
Speaking alongside German Chancellor Angela Merkel at a joint press conference, French President Nicolas Sarkozy said "a quite broad agreement is taking shape on the reinforcement of the EFSF."
Merkel said a French idea for the fund to acquire a banking license was dead and buried, leaving a mix of plans to use the EFSF to offer insurance to eurozone bond holders, and moves to create a 'fund within the fund' that would be topped up by some of the main emerging nations.
The "leveraging" of the EFSF comes alongside a deal being negotiated with banks for them to accept a 50 percent write-off on Greek debt, in exchange for a new bailout by the EU and the International Monetary Fund.
Tuesday, October 18, 2011
With his usual flair, British billionaire Richard Branson rappelled from a balcony, shook up a big bottle of champagne and took a swig while christening the world's first built-from-scratch commercial spaceport on Monday.
Mr Branson's Virgin Galactic will stage its commercial space tourism venture from Spaceport America in a remote patch of desert in southern New Mexico.
Mr Branson was joined by Governor Susana Martinez, astronaut Buzz Aldrin and scores of would-be space travelers at the terminal-hangar for the dedication. It had been nearly a year since Mr Branson was in New Mexico to celebrate the completion of the runway.
"The building is absolutely magnificent," he said. "It is literally out of this world, and that's what we were aiming at creating."
With the spaceport and mothership completed, the company is now finalizing its rocket tests.
"We're ticking the final boxes on the way to space," Mr Branson said.
He hopes enough powered test flights of Virgin Galactic's sleek spacecraft can be done by the end of 2012 to start commercial suborbital flights from the spaceport soon after.
More than 450 people have purchased tickets to fly with Virgin Galactic. About 150 of them attended the ceremony.
Before getting to enter the hangar, the crowd was treated to a flyover by WhiteKnightTwo, the mothership that one day will help take space tourists on suborbital flights.
The $209 million taxpayer-financed spaceport will be a launch station for people and payloads on the rocket ships being developed for Virgin Galactic.
With custom metal paneling and massive panes of glass, the state-of-the-art terminal rises from the desert floor to face the nearly 2-mile concrete runway.
The building will house Virgin Galactic's spacecraft, mission control and a preparation area for travelers.
It was six years ago that Virgin Galactic and New Mexico officials reached an agreement to build the spaceport. Officials said the completion of the terminal and hangar marks another major milestone that brings the dream of rocketing tourists into space closer to reality.
Still, the question many are asking is when the first ships will launch from Spaceport America. It was Mr Branson who once predicted the maiden passenger flight would take off in 2007.
Mr Branson acknowledged the wait in an interview Monday. He and his two children will be among the first to fly, and he said he wants to ensure he can bring them home safely.
"We want to be sure we've really tested the craft through and through before turning it over to the astronauts who bought tickets to go up," he said. "If it takes a bit longer, we'll take a little bit longer."
Commercial service will start up after the company gets a license from the Federal Aviation Administration. NASA has already signed a $4.5 million contract with the company for up to three chartered research flights.
Tickets for rides aboard WhiteKnightTwo cost $200,000. The 2 1/2-hour flights will include about five minutes of weightlessness and views of Earth that until now only astronauts have been able to experience.
Like development of the spacecraft, construction of the 110,152-square-foot terminal and hangar facility has been complicated. There were delays, building code problems, contractor disputes and costly change orders.
State officials blamed the unprecedented nature of the project as well as its remote location, the lack of infrastructure and the weather.
New Mexico Spaceport Authority executive director Christine Anderson arrived at the spaceport a day early to find WhiteKnightTwo and SpaceShipTwo stowed in the hangar.
"This was quite a feat," she said of the construction, joking with the crowd that she was glad the spacecraft fit in the cavernous hangar.
The building was designed by United Kingdom-based Foster Partners, along with URS Corp. and New Mexico architects SMPC.
Virgin Galactic and officials with the New Mexico Spaceport Authority are touting the design as green. It uses geothermal energy; tubes running through the earthen berm surrounding part of the building help cool the interior; and natural ventilation can be used during mild seasons.
Wednesday, October 12, 2011
The American dream is alive and well for the wealthiest 1% of Americans, but unfortunately, if you are in the other 99% the jury is still out.
"America is obviously a country where you can go from being middle class to upper class, but right now class mobility has sort of collapsed in the United States," says Zaid Jilani, senior reporter for the progressive think tank ThinkProgress.org. (See: America's Middle Class Crisis: The Sobering Facts)
This grim reality is in part the impetus for the Occupy Wall Street movement, which, now in its fourth week, will take to the streets of Manhattan's Upper East Side Tuesday in what it is calling the "Millionaire's March." Demonstrators will rally outside the homes of some of the city's wealthiest, including News Corp. (NWS) head Rupert Murdoch and JPMorgan Chase (JPM) CEO Jamie Dimon, to protest New York state's 2% millionaire tax set to expire at the end of the year.
As the Occupy Wall Street movement continues to grow, The Daily Ticker wanted to find out just how rich America's super-rich 1% really is. Jilani recently compiled the following research, entitled How Unequal We Are: The Top 5 Facts You Should Know About The Wealthiest One Percent of Americans.
As discussed in the accompanying interview, here's what Jilani outlined on his blog:
#1) The Top 1% Owns 40% of the Nation's Wealth:
Nobel Laureate Joseph Stiglitz points out the richest 1% of Americans now own 40% of the nation's wealth. This disparity is much worse than it was in the past, as just 25 years ago the top 1% owned 33% of national wealth.
How much does the bottom 80% own? Only 7%.
#2) The Top 1% Take Home 24% of National Income:
While the richest 1% of Americans take home almost a quarter of national income today, in 1976 they took home just 9% -- meaning their share of the national income pool has nearly tripled in roughly three decades.
#3) The Top 1% Own Half of the Country's Stocks, Bonds and Mutual Funds: The Institute for Policy Studies illustrates this massive disparity in financial investment ownership, noting that the bottom 50% of Americans own only 0.5% of these investments.
#4) The Top 1% of Americans Have Only 5% of the Nation's Personal Debt:
Using 2007 figures, sociologist William Domhoff points out that the top 1% have 5% of the nation's personal debt while the bottom 90% have 73% of total debt.
#5) The Top 1% Are Taking In More off the Nation's Income Than at Any Other Time Since the 1920s: Not only are the wealthiest 1% of Americans taking home a tremendous portion of the national income, but their share of this income is greater than at any other time since the Great Depression, as the Center for Budget and Policy Priorities illustrates in this chart, using 2007 data.
Tuesday, October 11, 2011
What's in a name? A lot, apparently. Apple's new iPhone is called the iPhone 4S. But what people really wanted was the iPhone 5.
The rumors online had predicted the second coming -- or, rather, the fifth coming. It would be wedge-shaped! It would be completely transparent! It would clean your basement, pick you up at the airport and eliminate unsightly blemishes!
Instead, what showed up was a new iPhone that looks just like the last one: black or white, glass front and back, silver metal band around the sides. And on paper, at least, the new phone does only four new things.
THING 1: There's a faster chip, the same one that's in the iPad 2. More speed is always better, of course. But it's not like people were complaining about the previous iPhone's speed.
THING 2: A much better, faster camera -- among the best on a phone. It has a resolution of eight megapixels, which doesn't matter much, and a new, more light-sensitive sensor, which does. Its photos are crisp and clear, with beautiful color. The low-light photos and 1080p high-definition video are especially impressive for a phone. There's still no zoom and only a tiny LED flash -- but otherwise, this phone comes dangerously close to displacing a $200 point-and-shoot digital camera.
THING 3: The iPhone 4S is a world phone. As of Friday, you will be able to buy it from AT&T, Verizon and, for the first time, Sprint ($200, $300 or $400 for the 16-, 32- or 64-gigabyte models). But even if you get your iPhone 4S from Verizon, whose CDMA network is incompatible with the GSM networks used in most other countries, you'll still be able to make calls overseas, either through Verizon or by inserting another carrier's SIM card. Call ahead for details.
Each carrier has its selling points. Sprint is the only one with an unlimited iPhone data plan (example: $110 a month for unlimited calling, texting and Internet). AT&T says it has the fastest download speeds. But if you care about calling coverage, Verizon is the way to go.
THING 4: Speech recognition. Crazy good, transformative, category-redefining speech recognition.
Exactly as on Android phones, a tiny microphone button appears on the on-screen keyboard; whenever you have an Internet connection, you can tap it when you want to dictate instead of typing. After a moment, the transcription appears. The sometimes frustrating on-screen keyboard is now a glorified Plan B.
Apple won't admit that it's using a version of Dragon Dictation, the free iPhone app, but there doesn't seem to be much doubt; it works and behaves identically. (For example, it occasionally seems to process your utterance but then types nothing at all, just as the Dragon app does.) This version is infinitely better, though, because it's a built-in keyboard button, not a separate app.
But dictation is only half the story -- no, one-tenth of the story. Because in 2010, Apple bought a start-up called Siri, whose technology it has baked into the iPhone 4S.
Siri is billed as a virtual assistant: a crisply accurate, astonishingly understanding, uncomplaining, voice-commanded minion. No voice training or special syntax is required; you don't even have to hold the phone up to your head. You just hold down the phone's Home button until you hear a double beep, and then speak casually.
You can say, "Wake me up at 7:35," or "Change my 7:35 alarm to 8." You can say, "What's Gary's work number?" Or, "How do I get to the airport?" Or, "Any good Thai restaurants around here?" Or, "Make a note to rent 'Ishtar' this weekend." Or, "How many days until Valentine's Day?" Or, "Play some Beatles." Or, "When was Abraham Lincoln born?"
In each case, Siri thinks for a few seconds, displays a beautifully formatted response and speaks in a calm female voice.
It's mind-blowing how inexact your utterances can be. Siri understands everything from, "What's the weather going to be like in Tucson this weekend?" to "Will I need an umbrella tonight?" (She has various amusing responses for "What is the meaning of life?")
It's even more amazing how Siri's responses can actually form a conversation. Once, I tried saying, "Make an appointment with Patrick for Thursday at 3." Siri responded, "Note that you already have an all-day appointment about 'Boston Trip' for this Thursday. Shall I schedule this anyway?" Unbelievable.
Siri can perform an incredible range of tasks. She can get stock prices, weather, currency and price conversions, dictionary definitions, measurement conversions, math totals. She lets you use your voice to edit or check the Clock, Calendar, Notes and Address Book apps, the new Reminders app and the renamed Music (formerly iPod) app. She can read your new e-mail and text messages to you -- and let you respond, all by voice (big news for drivers). She uses GPS to know where you are, so you can say things like, "Remind me to pick up the dry cleaning when I leave work" -- and she'll do it.
She is not, however, as smart as "Star Trek's" computers. She draws an apologetic blank if you say things like, "How many AT&T minutes do I have left this month?" or "How do you get ketchup stains out?" And it's surprising that she doesn't interact with more of the built-in apps. It would be great if you could open an app by voice ("Open Angry Birds") instead of hunting through 11 screens, or turn on Airplane Mode by voice, or display a certain set of photos.
Apple says Siri will improve with time -- both because she adapts to you, and because Apple itself will periodically upgrade her brain.
But already, Siri saves time, fumbling and distraction, and profoundly changes the definition of "phone." I find myself using certain commands constantly, especially "Wake me at," "Call," "Send a message to," "Give me directions to," and "Remind me."
It's a shame that Siri isn't available for older iPhones. Apple says that she requires the 4S's faster processor, although before Apple bought the company, there was a Siri app that ran just fine on other models.
Most of the new software features in the 4S, however, are indeed available to older iPhones, thanks to the free iOS 5 software update.
Some of its 200 new features play Android catch-up. For example, a tidy, attractive Notification Center appears when you swipe a finger down the screen. In one place, it lists all of your missed calls, text messages received, coming appointments and other updates -- a tremendous convenience.
You can now fire up the camera right from the Lock screen, saving you a detour to the Home screen. You can now press the Volume Up button to snap a picture; it falls exactly where a real camera's shutter button would be. Basic photo-fixing tools (auto-color adjust, cropping and red-eye removal) are now built in.
If you're sending a text, photo or video to another iPad, iPhone or iPod Touch, iOS automatically uses a new, proprietary service called iMessages instead of sending a traditional text message. (It's not a separate app; it's built into the existing Messages app. These iMessages appear in blue text bubbles; regular text messages appear in green.) This new service lets you see if the recipient has read your message yet, and it can save you money; instead of counting as a cellular text message, each i-to-i message goes over the Internet and costs you nothing.
Starting Wednesday, iOS 5 will be available as a free download for the iPhone 3GS and 4, all iPads and the last two generations of the iPod Touch.
(Speaking of older models: The iPhone 4 is still for sale, for $100, and so is the iPhone 3GS -- free with a two-year contract. That ought to be catnip to people who think that a phone's price is significant next to the $2,000 two-year cost of the contract.)
The iCloud service goes live on Wednesday, too. Like its predecessor, the $100-a-year MobileMe, iCloud wirelessly, automatically synchronizes your calendar, address book and mail among your phone, tablet, Macs and PC's. But iCloud also synchronizes your photos, music, e-books, apps and TV shows among all of those gadgets -- far more reliably. And it's free.
Android phones seem to come out every Tuesday at 3:45 p.m. Apple updates iOS and the iPhone only once a year. So Apple had a lot of catching up to do, even some leapfrogging. There are some rough spots here and there; for example, every now and then the 4S's camera app gets stuck on its startup screen. And while the battery still gets you through one full day, standby time is shorter than before (200 hours versus 300). But over all, Apple has done an excellent job.
The question isn't what's in a name -- it's what's in a phone. And the answer is: "A lot of amazing technology. And some of it feels like magic."
Monday, October 10, 2011
One of China's tallest buildings has opened for business in the nation's 'wealthiest village' of Huaxi, a symbol of the country's breakneck economic growth, officials and state press said Monday.
The Longxi International Hotel is 328 metres (1,082-feet) high and cost $470 million to build, an official in Huaxi said.
There are around 10 taller buildings in China - including the Shanghai World Financial Center, the third highest in the world - but all of these are in major cities.
Huaxi, however, is still classed as a village in east China's Jiangsu province despite having expanded significantly over the years, engulfing nearby villages and its population growing to 50,000 from 1,600 in the 1960s.
Once a poor farming community, it has boomed during the past 30 years of China's economic reform.
Dubbed a "model socialist village", Huaxi's wealth is based on the collective funds of registered households who have amassed money in industries such as steel and textiles.
Most household revenues are reinvested into further projects on a mandatory basis, keeping the cycle going.
According to the official China Daily newspaper, 200 village households are shareholders in the 74-storey, five-star hotel, each providing 10 million yuan ($1.5 million) in capital for the project.
"The building is a symbol of collectivism," the paper quoted Zhou Li, Huaxi's deputy Communist Party secretary, as saying.
But some critics dispute the village's "socialist" labelling, saying it has instead become a symbol of capitalism in the communist state.
Huaxi Group, the corporation that manages the village's business, has 2,000 shareholders - all registered residents. Non-residents are not allowed to be shareholders, even if they work there.
According to the official, the village's success has become a focal point for a long-standing nationwide government campaign to "study the Huaxi experience".
The hotel is expected to accommodate businessmen engaging in the village's vast industries, officials coming to study the Huaxi model, as well as flocks of tourists visiting the region, he said.
The building also includes a revolving restaurant, a rooftop swimming pool, mall, theatre, spa and an ox made of a ton of gold on the 60th floor.
Tuesday, October 4, 2011
It has been a cause of curiosity, speculation and even ridicule in the world of technology. Some called it a revolutionary product, some called it a dream that will never be realized. Others simply wrote it off, calling it vaporware, saying making a tablet in $35 is impossible, since the touchscreen itself costs that much.
But the initiative undertaken by the Ministry of Human Resource and Development is all set to be realized tomorrow.
The Ministry is leaving no stone unturned to ensure that the final product lives up to the hype and expectations surrounding the $35 tablet.
NDTV Gadget Guru has been following the evolution of this tablet right from the prototype stage. We believe that the final product will be very different from what the world has seen or knows about it till now. It will be interesting to see how close the final price of the tablet will be to the much touted $35 mark. It will no doubt be the cheapest tablet and have a shockingly low price, but our guess is that it will be priced slightly higher than the $35 mark.
It will retain the positives of the original concept behind this device. The fact that it is assembled here in India will give it the "Made in India" tag. The fact that it will pack in a lot of content targeted primarily at students but not restricted to this consumer base alone. It has the potential to make internet and its benefits accessible to a population where computer and internet penetrations are still very low.
Our fear, is that there will be some compromises on the hardware front to keep the price in check. The screen is sure to be a resistive one. And like the prototype we saw it is going to be a wi-fi only device for now. The first lot of the tablets released may not have the camera and the stylus (which we had seen in the prototype last year).
But the makers of the tablet believe that once the volume of production picks up, they will be able to provide upgrades to the hardware and also pack in more feature within this price.
Kapil Sibal and his team behind this project, believe that the roadmap ahead is to take this Made in India product out into the international market to benefit people, especially students across the globe, particularly in developing countries.
You can catch the live coverage of the launch, hands-on review of the Tablet and exclusive interviews with people behind the tablet, on our site from 2.30PM IST.
We all want a bite out of Apple, according to a report valuing global brands out on Tuesday.
The maker of the popular iPhone, iPad2, music players and computers was one of the biggest gainers in an annual marketing industry report on the top 100 global brands, jumping to No. 8 from No. 17, despite news that Chief Executive Steve Jobs is stepping down.
"It isn't just the fact they make pretty products," said Jez Frampton, CEO of Interbrand. "They've created an entire lifestyle and way of living."
The value of Apple Inc.'s brand jumped this year due to the company's success in establishing itself as the dominant player in the tablet market with its iPad, Frampton said.
"Looking at global intentions to purchase tablets, 85 percent of people considering a tablet say they want to buy an iPad," Frampton said. "There isn't a single other competitor above 5 percent."
Coca-Cola Co. took the top spot for the 12th year in a row. The soda maker's branding strength lies in the way its brand image permeates everything from its advertising and communications to its organizational culture, Frampton said.
Overall, tech brands dominated the list. Technology company IBM was No. 2 and Microsoft, Google, Intel and Hewlett-Packard all also ranked in the top 10.
Interbrand ranks companies by the amount of profit they make that is attributable to the strength of their brands. It uses a formula that combines the brand's future strength and its role in creating demand, among other factors.
One of the biggest decliners was Nokia, which fell to 14th place from eighth. The Finnish cellphone maker, which once dominated the European cell phone market, has been cutting jobs and downsizing as it faces stiff smartphone competition from Apple, Research in Motion and others.
HTC, a Taiwanese cell phone maker, on the other hand, jumped onto the list at No. 98. It was the first time a Taiwanese company has made it into the top 100, Frampton said. The company makes smartphones including the HTC Evo that run on Google Inc's Android operating system.
The European Central Bank could boost emergency credit offerings on Thursday to help shore up a banking system that has come under increasing pressure from the eurozone debt crisis.
Economists say the meeting in Berlin is much less likely to result in a cut in the bank's benchmark refinancing rate from the current 1.5 percent, though it is not completely ruled out.
The eurozone's troubled banks will be a major topic at the meeting and at the subsequent news conference in Berlin, the last appearance for bank President Jean-Claude Trichet before he leaves October 31 and hands over to successor Mario Draghi.
Many economists expect the bank will open its credit window wide, as it did during the financial crisis that followed the 2008 collapse of US investment bank Lehman Brothers. Analysts say the central bank could decide to offer unlimited credit for six months or a full year, and could also buy asset-backed securities known as covered bonds from banks.
That would provide support to European banks that are having difficulty borrowing normally from other banks. Banks are reluctant to lend because they fear Greece could default on its government bonds and cause losses that mean other banks would not pay them back.
The European Central Bank already offers short-term credit for as long as three months, but extending the loan period means banks are less vulnerable to market turmoil.
Protecting banks would be a key challenge if financially troubled Greece defaults on its debts, either in a coordinated way with eurozone governments' approval or a disorderly default in which the country simply runs out of money.
Belgium's finance minister, Didier Reynders, said Tuesday that the eurozone will likely boost the financial firepower of its euro440 billion ($580 billion) rescue fund. One of the fund's purposes is to help recapitalise troubled banks, but as the eurozone's debt crisis has intensified the fund has started to look too small to reassure markets.
Eurozone officials however have moved slowly to beef up the rescue fund and to get Greece an additional installment of money from a 2010 bailout that could keep it from a disorderly default in coming weeks.
That puts additional pressure on the ECB as eurozone crisis manager.
"The ECB will once again face a role as fire brigade in the debt crisis," economist Carsten Brzeski at ING in Brussels wrote in a research note. "While the ECB looks likely to get the remaining tools out of the 2008 first aid kit on Thursday, a rate cut could be a bridge too far, for the time being."
Royal Bank of Scotland however predicts a quarter point cut Thursday, and if not then, by the Nov. 3 meeting. More economists think the bank will lower rates to 1.0 percent by early next year.
Signs that Europe's economy is headed for a slowdown or recession are increasing pressure on the bank to cut rates. But September's sharply higher inflation rate of 3.0 percent — means the bank's 23-member rate-setting council may wait.
A rate cut could help keep the economy from slowing because it lowers borrowing costs for businesses. But lower rates can also fuel inflation.
Signs of trouble among banks have multiplied in recent days. The Franco-Belgian bank Dexia saw its shares fall 24 percent Tuesday in the wake of a statement by Moody's that the agency might downgrade its credit rating. Dexia is heavily exposed to Greek debt.
Deutsche Bank said it couldn't achieve its profit estimate for the year and would write down an additional euro 250 million ($333 million) in Greek debt after taking a euro155 million ($207 million) Greek debt charge in the second quarter.