Financial inflation part of the problem. Australia’s increasingly entrenched inflation problem has a number of dimensions — one of them the soaring cost of financial services. Quarterly estimates on the consumer price index published yesterday by the Australian Bureau of Statistics incorporate the partial result of efforts to improve the method of estimating the costs of financial services. Over the twelve months to June 2008, the price of financial and insurance services rose 9.9%, with increases in the prices of all components. The price of deposit and loan facilities increased 16.2%, while insurance services increased 7.0% and other financial services increased 3.1%.

There’s a degree of catch up or correction on past estimates in these rates of increase, but the level of inflation in financial services is more than twice that of the wider consumer price index. For the June 2008 quarter alone deposit and loan facilities increased 9.5%, insurance services increased 2.5%, while the cost of other financial services fell 2.9%. – The Sheet

Fighting for Starbucks. Now that Starbucks Corp. has disclosed the 600 locations it wants to shutter, a phenomenon is taking hold: the Save Our Starbucks campaign. In towns as small as Bloomfield, N.M., and metropolises as large as New York, customers and city officials are starting to write letters, place phone calls, circulate petitions and otherwise plead with the coffee company to change its mind.

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“Now that it’s going away, we’re devastated,” said Kate Walker, a facilities manager for software company SunGard Financial Systems who recently learned of a store closing in New York City.

It is an unusual twist in the saga of Starbucks, one of the fastest-growing retailers of the past decade. For years, Starbucks gained attention when a town didn’t welcome it. Independent coffee shops complained about the big-muscled competition, and residents bemoaned the erosion of local character. But ever since Starbucks announced this month that it would close 600 stores by early next year, as its business struggles, the rallying cause has switched to saving these endangered locations. – Wall Street Journal 

Goliath vs Goliath. Two of the world’s richest men, with bank balances that rival the gross domestic product of small countries, are joining forces to wage war against a common enemy — the tobacco industry. Bill Gates, the co-founder of Microsoft, and Michael Bloomberg, the Mayor of New York City, are making a combined investment today of $500 million (£250 million) to try to reduce smoking in countries such as China and India and to help to prevent a “tobacco epidemic” in Africa.

The billionaires, through their eponymous charities, intend to lobby governments in Asia, Africa and South America to increase taxes on cigarettes, implement smoking bans and raise awareness of health risks. Nearly five million people worldwide a year — almost 14,000 every day — die from tobacco-related illness, more than are killed by any other single agent. Unless urgent action is taken, they say, as many as one billion people — more than two thirds of these in the developing world — could die this century as a result of smoking. — Times Online

Gassing up with garbage. After years of false starts, a new industry selling motor fuel made from waste is getting a big push in the United States, with the first commercial sales possible within months. Many companies have announced plans to build plants that would take in material like wood chips, garbage or crop waste and turn out motor fuels. About 28 small plants are in advanced planning, under construction or, in a handful of cases, already up and running in test mode.

For decades scientists have known it was possible to convert waste to fuel, but in an era of cheap oil, it made little sense. With oil now trading around $125 a barrel and gasoline above $4 a gallon, the potential economics of a waste-to-fuel industry have shifted radically, setting off a frenzy to be first to market. – New York Times

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Peter Fray
Peter Fray
Editor-in-chief
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