The French are getting thriftier, and that poses a problem for the European economy, The Wall Street Journal reported. For more than a decade, consumer spending has driven growth in France and buoyed the economy of the nations -- now 16 -- that share the euro. The danger for France and for Europe is that this turns into a longer-term trend.

No villas in the south of France for Russia’s top bankers this summer, if Vladimir Putin gets his way, the Financial Times reported. Russia’s prime minister has sternly warned bank chiefs not to plan any holidays until they have sorted out the financing of the country’s recession-hit economy. It will take a huge effort, with output forecast to fall by about 8 per cent this year and hopes of a quick recovery fading. Even the big state-owned banks that dominate the sector are under pressure, with VTB, the second-largest, warning of possible annual losses.

Strains in pensions systems, in both private and public provision, threaten to turn the financial crisis of the past two years into a social crisis lasting for decades, the Organisation for Economic Co-operation and Development warned on Tuesday. In its annual analysis of the health of pensions systems globally, the Paris-based organisation found private pension plans lost 23 per cent of their value last year, while higher unemployment “leaves little room for more generous public pensions”, the Financial Times reported.

PSA Peugeot Citroen, Europe’s second-largest carmaker, said it may have an operating loss of as much as €2 billion ($2.8 billion) this year as sales decline and people buy smaller, less costly autos, Bloomberg reported. Peugeot rose as much as 3.5 percent in Paris trading after the company said European unit sales may fall 12 percent this year, better than a 20 percent drop forecast April 22, as governments pay people to scrap old cars and buy new ones. The loss will be €1 billion to €2 billion, it said.

A plan to tighten financial-market regulation is pitting the U.K., home of Europe's financial center, against other members of the bloc, The Wall Street Journal reported. At a European Union summit starting Thursday, a key issue will be how much power should be handed to regulatory bodies that the EU's executive arm, the European Commission, wants to establish, and who will head them. The U.K.'s resistance to the EU plan comes amid tensions among British officials over financial regulation. In a speech Wednesday, Mervyn King, the head of the Bank of England, warned that the U.K.

London or Paris may become the hub for the resolution of dozens of lawsuits related to banks’ and investment funds’ exposure to Bernard Madoff’s Ponzi scheme, Luxembourg’s Treasury and Budget Minister Luc Frieden said. The nation’s courts have dealt with more than 20 lawsuits and will get hundreds more in the coming months from investors seeking compensation from banks, funds and auditors for losses.

France's US-owned couture house Christian Lacroix SNC has declared insolvency after falling foul of the global crisis, the company said Thursday. Arguably one of the most exuberant couturiers in Paris, Christian Lacroix SNC said in a statement that the company owned by Falic had declared insolvency before a Paris court due to "the sharp downturn of the luxury market," Agence France-Presse reported.

Britain yesterday became the first big economy to be warned in the financial crisis that it might lose its top-notch credit rating, in a move that raised fears of possible downgrades for other large industrialised nations, the Financial Times reported. S&P based its warning on a forecast that net government debt risked approaching 100 per cent of national income and staying at that level. "A government debt burden of that level, if sustained, would in Standard & Poor's view be incompatible with a AAA rating," the agency said.

The European Commission proposed a draft law on Wednesday that would make it mandatory for hedge funds to register and disclose information on leverage to supervisors if they want to operate in the EU, a Commission official said. The draft law has been subject to intense horse-trading ahead of its publication as Britain, the European Union's hedge fund centre, fears overly draconian rules, while France is a keen backer of tighter regulation. The global hedge fund sector has assets totalling $1.4 trillion, relatively small compared to the wider financial market.

In Spain, when the previous finance minister said there was no room for tax cuts or spending to buoy the economy, he was sacked by the prime minister. "There is room--there can't not be," new finance minister Elena Salgado said last week, in the face of a Europe-high 17% unemployment rate. But in the U.K., France and Italy, gaping budget deficits have largely ended the chance of major new tax cuts or spending . Germany says that despite expecting a 6% dive in its economy this year, it is more worried about stoking inflation in 2010.