Global business

UBS raised the estimate of its loss from an alleged rogue-trading scandal to $2.3 billion. The Swiss bank claimed the loss resulted from unauthorized trading in London that was within its "normal business flow" and alleged that "the true magnitude of the risk exposure was distorted because the positions had been offset" with "fictitious" forward positions. UBS' biggest shareholder, Singapore's GIC sovereign-wealth fund, issued a rare rebuke stating its "disappointment and concern" about the matter.

Morgan Stanley confirmed that John Mack would step down as chairman at the end of the year. James Gorman, who has run the Wall Street firm on a day-to-day basis as chief executive since January 2010, will combine the job of chairman with his present role. Mack will still advise the bank.

Moody's downgraded the long-term credit ratings of Bank of America and Wells Fargo, and cut the short-term rating for Citigroup, reasoning that the government "is more likely now than during the financial crisis to allow a large bank to fail ... as the risks of contagion become less acute."

A survey of economists and property experts commissioned by MacroMarkets, a firm specializing in technology for financial innovation, found a "dimming outlook" for home prices in America. Robert Shiller, one of the founders of MacroMarkets, said that the "struggling" response of governments and markets to the recent crises is shaking underlying confidence in the housing market.

The IMF's latest World Economic Outlook gave warning that the risks to growth are "clearly to the downside," and urged politicians in Europe and America swiftly to resolve their respective problems over debt. The fund shaved one percentage point from its projection of America's economic growth rate this year, to 1.5 percent, and cut its forecast for the euro area from 2 percent to 1.6 percent.

United Technologies, a big aerospace and defense conglomerate, sealed a deal to buy Goodrich, which makes aircraft components, for $16.5 billion.

New charges were laid against Full Tilt Poker as part of the U.S. government's ongoing fraud case against online gambling companies. A federal prosecutor alleged that Full Tilt was actually a "Ponzi scheme" that distributed money it had collected from customers (which it promised to hold in personal online accounts) to the firm's executives and celebrity poker players, leaving it unable to pay reimbursements.

An appeals court in Sweden granted Saab bankruptcy protection, overturning a lower court's decision to deny the carmaker a legal shield from its creditors as it attempts to secure funding from China.

Prada shrugged off concerns about struggling economies as it posted a healthy increase in revenue for the first six months of the year that helped profit to jump by 74 percent. The luxury-goods company is expanding in the Asia-Pacific region, from where it gets a third of its sales.

Political economyThe Greek cabinet agreed to further austerity measures being demanded by European and international creditors before Greece receives its next tranche of bailout money. With eurozone banks finding it difficult to access short-term loans amid concerns about their exposure to a potential Greek default, the European Central Bank took co-ordinated action with the central banks of America, Britain, Japan and Switzerland to boost dollar liquidity in the European banking system.

It was a rough week for Silvio Berlusconi. Leaked transcripts of wiretapped conversations appeared to show Italy's prime minister boasting about his sexual prowess and saying that he governed the country in his "spare time." Fresh allegations emerged that Berlusconi had abused his power by using state resources to help his friends and allies. An unexpected downgrade of Italy's sovereign debt by Standard & Poor's added to the pressure. Berlusconi denied any wrongdoing, and said that S&P was reacting to media reports, not facts.

The Free Democrats, the junior partner in Angela Merkel's coalition government, were trounced in a state election in Berlin. Some in the party want to capitalize on growing Euroskeptic sentiment in Germany by voting against bailout plans in parliament.