Japan plants, Irish banks and the rating bonanza

New day, new problems:

Let us start with a score of bad news from Japan's hidden nuclear crisis:




Radiation spreading

The IAEA has just announced that it has found excessive radioactivity in a village 40 km from Fukushima. From Reuters: "Radiation measured at a village 40 km from Japan's crippled nuclear plant exceeded a criterion for evacuation, the U.N. nuclear watchdog said on Wednesday, the latest sign of widening consequences from the crisis. Criticized for weak leadership during Japan's worst crisis since World War Two, Prime Minister Naoto Kan has said he is considering enlarging the evacuation area to force 130,000 people to move, in addition to 70,000 already displaced."

New nuclear power plant at risk?

The 6 problem reactors which have gotten all of the press are located within the Fukushima Daiichi complex.
However, the same nuclear power plant operator that runs the Daiichi complex - Tepco - runs a separate nuclear complex 7 miles away, called Fukushima Daini. There are 4 reactors located at the Daini complex.
Today, Tepco announced that smoke was seen rising from Daini reactor number 1:
Smoke was spotted at another nuclear plant in northeastern Japan on Wednesday, Tokyo Electric Power Co. said. The incident was subsequently said to be under control.

Ireland March Madness

Irish Stress Tests May Leave Government in Control of Banks
The Irish government may be forced to take controlling stakes in Bank of Ireland Plc and Irish Life & Permanent Plc, the last of the country’s biggest lenders to escape state control, following tomorrow’s stress tests.“They’ve clearly got most to lose,” said Oliver Gilvarry, head of research at Dublin-based Dolmen Securities, who has “sell” rating on both banks. “It’s difficult to see how either will end up less than 50 percent owned by taxpayers.” The Irish Central Bank will at 4:30 p.m. tomorrow publish its third round of stress tests. The results will determine if the two can avoid joining four of the country’s biggest banks in majority state ownership after they all logged record losses as the country’s decade-long real estate bubble burst.
Ireland may require banks to raise an additional 27.5 billion euros ($39 billion) of capital, according to the median estimate of 10 analysts surveyed by Bloomberg News. The government has pledged to provide that money if banks fail to raise it themselves from a 35 billion-euro fund set up under the country’s international bailout in November. Shares of the two lenders have declined by more than 50 percent since that rescue.

Also, Irish Bank Suspends Shares in Nationalization Fears.


Rating Bonanza

Yesterday S&P cut Portugal’s sovereign debt rating for the second time this week to BBB- from BBB and Greece’s rating from BB+ to BB-, with Portugal left on negative outlook and Greece left on watch negative. 

Dying industries

A new analysis by research firm IBIS World looks at 10 industries that appear to be dying. The list isn’t exactly shocking, but it represents a mix of sectors that are being left behind by technology or have been hurt by cheaper overseas competition.


The full list is below:

Sector	Revenue 2010 (in millions)	Decline 2000-2010	Forecast Decline 2010-2016	Establish- ments 2010	Decline 2000-2010	Forecast Decline 2010-2016
Wired Telecommunications Carriers	$154,096	-54.9%	-37.1%	23,474	-10.5%	-15.9%
Mills	$54,645	-50.2%	-10.0%	9,553	-23.6%	-12.8%
Newspaper Publishing	$40,726	-35.9%	-18.8%	6,128	-28.6%	-17.6%
Apparel Manufacturing	$12,800	-77.1%	-8.5%	2,265	-60.5%	-11.3%
DVD, Game & Video Rental	$7,839	-35.7%	-19.3%	17,369	-34.8%	-11.2%
Manufactured Home Dealers	$4,538	-73.7%	-62.0%	3,968	-56.7%	-58.7%
Video Postproduction Services	$4,276	-24.9%	-10.7%	1,789	-43.2%	-37.8%
Record Stores	$1,804	-76.3%	-39.7%	2,916	-77.4%	-11.6%
Photofinishing	$1,603	-69.1%	-39.1%	7,083	-59.3%	-33.3%
Formal Wear & Costume Rental	$736	-35.0%	-14.6%	2,310	-28.5%	-17.0%

Eurozone update

Amid the general indifference of the media and the markets more bad news from the Eurozone:

UK
 
UK Prime Minister David Cameron refused to respond to suggestions that Britain may have to pledge billions of pounds to any emergency funding.  He said: "It's not right to comment and speculate on another country's finances, and I'm not going to do that."  He has faced angry calls from his own Conservative MPs to refuse to contribute British money towards a bail-out. Well at the end it is a matter to save UK banks which are heavily exposed with the PIIGS as per chart below.



Spain

Moody's put another nail in Spain's coffin this morning, downgrading 30 Spanish banks by one or more notches. Interestingly, they left Santander and BBVA alone.

Portugal

There had been expectations that the two-day summit in Brussels would agree a resolution over rescuing Portugal.  But Portuguese ministers said they had no intention of following Greece and the Irish Republic in tapping the bail-out fund.  Even so, analysts believe it is only a matter of time before other countries are forced to provide support to the ailing economy. Portugal says it does not need aid, but many analysts say Lisbon is in denial.
The financial markets are also worried as Portugal must repay a large chunk of debt to lenders in April.  On Friday, Standard & Poor's downgraded Portugal's credit ratings by two notches to BBB and warned it could cut it further. S&P followed a two-notch cut by Fitch on Thursday.


Ireland

A quick deal has been put together to give Irish banks $80Bn to shore up their finances - also money that is being created out of nowhere but, on the whole, it's keeping the EU markets stable so far.