Concern for post-crisis generation; Sony's bread and butter isn't electronics; 'Big four' banks cut 1,89,000 jobs in five years; China anger at 'handcuffing' girl; Online firm 'laundered' $6 bn; India IPOs shunned

1 Concern for post-crisis generation (Rupert Neate & Graeme Wearden in The Guardian) European leaders warned that youth unemployment – which exceeds 50% in some countries – could lead to a continent-wide catastrophe and widespread social unrest aimed at member state governments. The French, German and Italian governments joined forces to launch initiatives to "rescue an entire generation" who fear they will never find jobs.

More than 7.5 million young Europeans aged between 15 and 24 are not in employment, education or training, according to EU data. The rate of youth unemployment is more than double that for adults, and more than half of young people in Greece (59%) and Spain (55%) are unemployed. Francois Hollande, the French president, dubbed them the "post-crisis generation", who will "for ever after, be holding today's governments responsible for their plight".

"Remember the postwar generation, my generation. Europe showed us and gave us the support we needed, the hope we cherished. The hopes that we could get a job after finishing school, and succeed in life," he said at conference in Paris. "Can we be responsible for depriving today's young generation of this kind of hope?"
Hollande outlined a series of measures to tackle the problem, including a "youth guarantee" to promise everyone under 25 a job, further education or training. The plan, which has been discussed by the European commission, will be supported by €6bn of EU cash over the next five years. Another €16bn in European structural funds is also set aside for youth employment projects.

2 Sony’s bread and butter isn’t electronics (Hiroko Tabuchi in The New York Times) Sony is best known as a consumer electronics company, making PlayStation game consoles and televisions. And it loses money on almost every gadget it sells. Sony has made money making Hollywood movies and selling music. That profitable part of the business is what Daniel S. Loeb, an American investor and manager of the hedge fund Third Point, wants Sony to spin off to raise cash to resuscitate its electronics business.

But as Mr. Loeb pressures Sony executives to do more to revive the company’s ailing electronics arm, some analysts are asking, Why bother? Sony, it is suggested, might be better off just selling insurance. Or just making movies and music. But not electronics. A new report from the investment banking firm Jefferies delivered a harsh assessment of Sony’s electronics business. “Electronics is its Achilles’ heel and, in our view, it is worth zero,” wrote Atul Goyal, consumer technology analyst for Jefferies, in the report, released this week. 

The maker of the Walkman and the Trinitron without electronics? What would it do? Although Sony sells hundreds of products as varied as batteries and head-mounted 3-D displays, it so happens that Sony’s most successful business is selling insurance. While it doesn’t run this business in the US or Europe, Sony makes a lot of money writing life, auto and medical policies in Japan. Its financial arm accounts for 63% of Sony’s total operating profit last year. 

3 ‘Big four’ banks cut 1,89,000 jobs in five years (Jennifer Rankin in The Guardian) By the end of this year, Britain's four biggest banks will have axed 189,000 jobs around the world in the five years since the financial crisis broke, according to new calculations. The figures, compiled by Bloomberg, show that Royal Bank of Scotland, Lloyds Banking Group, Barclays and HSBC will have cut their global headcount by 24% to a nine-year low of 606,000, compared with their pre-crisis peak of 795,000 in 2008.

The figures come after three of the four banks reported sharply improved profits. Last month, Lloyds posted first quarter profits of £2bn, up from £288m at the same time a year ago. HSBC this month said it made a quarterly pre-tax profit of $8.4bn, almost double the $4.3bn it reported at the same time last year. RBS swung to a £826m profit after a £1.4bn loss last time. Barclays last month reported adjusted first quarter profits had fallen 25% to £1.8bn, partly due to the cost of the bank's restructuring programme.

4 China anger for ‘handcuffing’ girl (BBC) Two Chinese officials have been suspended after being accused of handcuffing and parading a 13-year-old girl down a street for spilling a drink on a government car, state media say. The officials - a Communist Party chief and a police officer - reportedly forced the teenager to walk up and down for 20 minutes. The incident has caused uproar on Chinese social networking sites.

A post on a micro-blogging site claimed the girl got into an argument with local officials in the county of Hezhang, Guizhou province, in April after accidentally splashing water onto a government car, according to China's state-run news agency Xinhua. She was then reportedly handcuffed and paraded up and down a street. It comes as part of a growing phenomenon of Chinese internet users exposing information about officials perceived to have done wrong.

5 Net firm ‘laundered’ $6 bn (BBC) The Liberty Reserve digital money service that was shut down laundered more than $6bn (£4bn) in criminal cash, US authorities have said. Weekend police raids in 17 countries scooped up Liberty Reserve's owners, operators and its computer hardware. The Department of Justice said it was the "largest international money-laundering prosecution in history".

Liberty had about a million users and processed more than 55 million illegal transactions, said DoJ court papers. The documents allege that seven people involved in running Liberty Reserve set up the digital cash service as a "criminal business venture" designed specifically to "help criminals conduct illegal transactions and launder the proceeds of their crimes". Liberty Reserve was so successful that it became a "financial hub of the cyber crime world", whose users were involved in credit card theft, investment fraud, hacking, child pornography and drug trafficking.

6 India IPOs shunned (Ashutosh Joshi & Shefali Anand in The Wall Street Journal) India is on pace for its worst year for initial public offerings since the global financial crisis, largely because two key groups of investors—foreign institutions and the Indian public—are staying away.

It has certainly been a slow year thus far. Including search engine Just Dial Ltd., which raised $166 million last week in the country's biggest IPO of the year, three companies have raised a total of $234 million—the lowest since 2009, according to data provider Dealogic. By comparison, there were 26 IPOs through May 28, 2010, that raised $2 billion.

Foreign investors have, in fact, poured money into Indian stocks this year, but they have been more selective about IPOs. Market experts say these investors are still potential buyers of new offerings, but only by profitable companies with strong cash flow and proper corporate governance.

Looking ahead, many investors expect India's central bank to further cut interest rates to promote growth, a move seen as bullish for stocks—at least those already listed. Analysts say it will take more than rate cuts to revive the IPO market. "Big IPOs will come only when companies are confident of retail participation," said Mr. Gupta of Globe Capital Market.