Boom, Bust, repeat as necessary – Banks are back in action, with government protection and $$$ for desperate borrowers (like me). But how can we dampen the next bust? Better rules that reward bank managers to bank risk through bonds and increasing capital requirements for less stable banks.
American pastime: missing important deadlines – Oops. May 13th was the last day to submit your claim to the ocean floor. But since we’re not part of UN Convention on the Law of the Sea, we don’t get cool claims, like sovereign rights over standard 200 nautical miles from shore, or shipping passage rights. Sounds like a bad treaty from Civilization II.
America’s other pastime: trying to fix the Middle East – Obama has to convince Netanyahu to give a little with Palestine. Biggest problem is how to govern West Bank: Abbas and Fatah party aren’t effective, Hamas is strong, but they have the whole terrorist vibe going still.
Does this mean they’re cancelling Paperboy 2 for Nintendo? – people read their news online. Americans 18-24 who get news each day: 25%. New apps offer potential for WSJ and others to charge ‘micropayments’ – I promise you this: Business in Briefs will remain free, particularly with its strong advertisement supported model available on the right of your screen.
British MPs (members of Parliament) have fat chequebooks! – MPs get expenses to cover anything ‘necessary in pursuit of their duty’ – like hiring a guy to clean your moat. But they’re underpaid compared to American, European counterparts. Pay them more – attract better politicians and cut back on scandal. No jab at Gordon Brown?! Not one!
I will now demonstrate the proper way to club a baby seal – European Union politicians needed to appease the fur-loving animal rights people without actually impacting anyone doing business in Europe (like pig farmers), so they target Canadian seal hunters and ban sealskin products.
Best job ever – top right page 27 – Business Planning for Antarctica
Seabed is up for grabs – important stats: claim up to 350 miles from land, Russia claimed North Pole (good luck with that) France claims Canadian ocean through St. Pierre & Miquelon. Sulphide is important. Seabed mining companies: Neptune Minerals and Nautilus Minerals
Is California that screwed up? – Apparently yes. $42 billion deficit – May20th special election, but nobody votes other than crazy extremists. Time for a new state constitution to curb ‘citizen power
Old People are expensive and smile a lot. My suggestion – Budget deficit for US is $2 trillion. Budget director Peter Orszag keeps talking about social security and medicare as ‘problems’ because the future unfunded cost is only $104 trillion. Wah.
Gay Marriage in New England – New Hampshire and Maine are latest to say ‘Gay, OK!’ children could care less. State laws likely to change – federal law still problematic.
I prefer to call them ‘stress position’ pictures – there are 44 more pictures of prisoner treatment from Abu Ghraib. ACLU wants them released, Pentagon says hold on. Obama agrees that they just provide more trouble.
Wooo! Happy statistics from New Orleans! Ready? – 25% never came back. Only 57% medical facilities re-opened. 66% report chronic health problems. 2x suicide rate, 20% poverty. 20% considering leaving.
Center lane closed for construction – Republicans probably shouldn’t get more extreme. Center ideology served democrats well. Less toxic (Rush Limbaugh) and some competence?! Shocker!
Bush’s BFF is Shady, but Popular – Colombia President Álvaro Uribe, a close friend of G. Bush, to seek an unprecedented third consecutive term as president. Despite scandals of domestic spying and some ‘democratic security’, 84% of Columbians said they would support Uribe’s right to run again and his approval rating is 71%. I think someone is jealous
Chávez is an Oily Bohunk? –PDVSA (Petroleums of Venezuela) ran out of cash - accrued $70 billion in liabilities. Chavez turned it into state owned org. PDVSA builds houses, imports food, runs farms and pays for adult-education projects. Dial would say that PDVSA is trying to do too much – not a sustainable advantage.
Kirchner Poised to Win Husband-of-the-Year – Argentina’s president, Cristina Fernández, and her husband, Néstor Kirchner, are campaigning to keep the Peronist party in the majority. Two political parties threaten their power – Conservative Peronists and the Radical Party. Hubby Kirchner is campaigning particularly hard in Buenos Aires, which contains 2/5 of Argentina’s voters. The IMF believes that Argentina’s economy will shrink by 1.5% this year.
Still at it in Pakistan - Pakistan army continues to battle Taliban in Swat valley. Citizens unhappy and loosing trust in army because lots of innocent civilians dying in battle. American NGO survey result: 69% consider Taliban & Al-Qaeda a “problem” and 45% support army’s fight.
Spec Ops Commander in top job for Afghanistan: General David McKiernan fired. Insiders claim the general lacked Dynamism. The new commander will be General Stanley McChrystal (West Point ’76 - former head of the Joint Special Operations Command). Questions being raised because the Special Forces have figured in some of the worst mishaps, in which large numbers of civilians have been killed in air strikes.
Closing stages in Sri Lanka - The army and Tamil Tiger rebels continue to battle (480 civilian refugees killed in two days). Total of 8000 civilians killed so far in battle. Senior leader of the Tigers, Velupillai Prabhakaran is also in the battlefield (killed since publication). Government will not rest until the Tigers are all wiped out.
Nepal Political crises - Maoist Government in trouble. resignation of Prime Minister Pushpa Kamal Dahal. Maoists have stopped the assembly from functioning since the resignation. Opposition parties (UML and Nepal Congress) are attempting to form new government but they don’t have a majority and face stiff opposition from the Maoists.
Legacy of Sichuan earthquake – disaster last year left 86,000 people dead or missing. Government was praised initially for its rescue efforts. Government attempted to restrict media coverage and conversation with victims. Was the damage done because of lousy construction methods? Over 5335 students killed in a school building. Parents of victims and the public are angry with the government stance on this.
You must kill the Prime Minister of MALAYSIA! - United Malays National Organization (UMNO) led by Anwar Ibrahim got three legislators in Perak to switch sides disrupting the majority in 59-seat assembly. Opposition claiming that their man is the Chief Minister and his removal was illegal. Takeover approved by hereditary state ruler Sultan Azlan Shah. Lots of people own the Chief Minster seat in a very short time !!
Stimulating Australian budget: Booming Australian economy slowing down this quarter (after a decade of growth) with cash deficit A$58 billion ($44 billion in real money), or 4.9% of GDP. Kevin Rudd leader of labor party had promised big spending on health, education and attacking climate change. Now he has to either raise taxes or drop the plan. China is Australia’s biggest trading partner.
Yeah LDP, Yeah you know me! - Government debt at twice the economy’s output. Planning to float new currency. Opposition leader Mr. Ozawa under pressure to step down from DPJ(Democratic Party of Japan) leadership. Ruling party LDP (Liberal Democratic Party) has been in power for a very long time in Japan. Mr. Ozawa was initially with LDP and then moved to DPJ.
Peace in the Middle East? Not Likely…- Obama is ready to enter the Palestinian-Israeli war for peace in the Middle East. New diplomacy has gained support from some countries like Jordan and Egypt, and will face lots of problems from people like Iran and the threat of a potential nuclear war.
Can’t we all just Get Along? - Israeli Prime Minister Binyamin Netanyahu is visiting the White House this week for his first meeting with Obama where he may unfurl a new plan for cooperation with Palestine. Takes tough (unlikely to succeed) stance will center on the Palestinian conflict and the problems that Iran poses for the country.
AH the Right to Free Speech, Oh Wait, This is Qatar - Robert Menard, famous for his affinity for controversy, has been asked to run “the world’s first press freedom centre” in Doha. This is a big step towards liberalization in the region, but controversy will follow Menard and there are a lot of conflicting interests in play.
Jacob Zuma not the one in charge? Say it ain’t so! -Trevor Manuel, the popular (former) finance minister in South Africa, has been reassigned as the head of the national planning commission. The new post will reportedly give Manuel more power as Zuma doesn’t really know what he is doing and would rather be the public face of the government and let someone else call the shots. The real extent of Manuel’s power remains to be seen.
Special Section – Banking industry is changing. G20 average govn’t debt 100% of GDP by 2014. Total bill for financial collapse: $4.1 trillion (not counting my mortgage…yet). Blame Canada, even though The Economist gives them props for doing things right. Awesome graph on page 19.
Newsflash – There is a recession in Europe! - Baltic countries face the most uncertainty; Estonia, Latvia, and Lithuania have all seen year-on-year double-digit declines to GDP. The IMF has responded to stave off devaluation; a sign of better coordinated outside help. Many industries are in collapse, but the alternative energy industry is growing.
I swear, if I miss the Cavs winning a championship over this… - 89 year old Clevelander John Demjanjuk has been flow to Germany for another trial in his supposed involvement in the murder of at least 29,000 Jews during WWII, again. The facts will be difficult to prove, but this is yet another sign of Germany’s “demonstrative remorse” and its zeal for an honest reckoning with the past.
Well, it aint the Ritz Carleton… - So apparently French prisons are not very clean. Safety is a problem because of overcrowding and lots of people kill themselves. There are new laws to open new prisons and to revamp old ones to bring them up to European norms, while the really bad ones are being closed down.
Russia is Ready to Fight Some More - Russia threw a lavish parade equipped with 9,000 soldiers in Red Square to celebrate its military prowess and remind the world that it was a good guy during WWII. On a side note, Vladimir Putin for 2012!
Immigration a Problemo in Italy - Italy is being hit hard by illegal immigration from Libya and has begun returning seized boats to Libya as opposed to offering the immigrants a chance to seek asylum in Italy.
Immigration Also a Problem in Greece, or is it Discrimination? - Greece has always been known for the hospitality it shows to immigrants, but now that Pakistanis, Afghans, Iraqis, Sudanese, and Somalians want in Greece is singing a different tune. They still don’t turn them away, but they have policy aimed at discouraging them to stay. With camps and detention centers in place, the immigration scene is not pretty, but arrival rates show no signs of slowing.
The European Commission, aka Indian Givers - The European Commission has frozen funds it extended to Bulgaria due to fraud and conflicts of interest. This is all told through an anecdote about a dairy farmer named Stefan Petrov, who blames the mess on the Bulgarian government, and not on the EU.
Somebody skipped their ethics class in Parliament - MPs like to put a lot of their expenses on the corporate card. Most complaints stem from a second-home allowance worth up to 24,000 pounds per year. Voters are pissed, and not in the fun British-sense, but rather in the angry American sense.
It’s never as good as it looks - The actions of the Bank of England have helped to energize the British economy, as the stock market is up and fear of banks collapsing is down. Unfortunately, the labor market is not showing signs of relief as jobless claims are up significantly over the past 3 months, and earnings are down.
If everyone has an immigration problem, where are they coming from? - This time in England. Migrant farm workers in the countryside are subject to terrible living conditions and have been neglected for the most part until now. The majority of the migrants are from eastern Europe, primarily Poland.
Finally, Bagehot makes sense - Britain is living through a Yom Kippur moment and apologizing for everything, notably the bankers for sinking the economy and MPs for expensing everything. In typical Economist fashion Gordon Brown is urged to apologize for sucking at life.
I’m guessing the Popemobile doesn’t do sand off-roading well – Pope didn’t do too well in middle east. Managed to make everyone angry, didn’t strongly condemn a holocaust denying bishop. Biggest catholic country: Brazil but fading there too.
Most Unethical Corporate Behavior on the decline – Cutting back on CSR easy way to save cash. AEP not doing a wind farm in Indiana. Don’t disappoint your employees by not following through with promises.
Intel Inside (a big mess) - $1.44 billion anti-trust fine – not because prices are anticompetitive, but because they often exclude rival AMD. Maybe if AMD had Ajay Bhatt they wouldn’t have this problem.
How come we don’t have GM-Chrysler drama like this? – Ferdinand Piech is the chairman of VW, fought off takeover by Porsche – now will likely integrate Porsche into VW group (including Audi, Bentley, Lamborghini and Bugatti – who knew?!)
El Plan Stupido – Spain wants to ban advertisements on Television Espanola. We’ll just tax private broadcasters. Right. Because they’re doing so well as is.
Compensation based on performance! Shocking! – advertising agencies for big brands (Coke, P&G, etc…) now being paid per value, not time.
Australia v. Telstra ends in KO – Telstra is telecom giant, run by Sol Trujillo. Wasn’t that great at the political games. Now state will build $43 billion network and Telstra will take back seat or break up.
Japan still has shiny bright stuff – Uniqlo sells casual clothing – same-store sales increases at 19%. Muji sells plastic bottles and homes (hell of a product mix).
iPhone killer? – Vodafone has 290million subscribers. Trying to build universal software platform. Vittorio Colao is the boss and good at his job.
Asian Economies Could Recover Faster Than the West - Asian countries are pumping more stimulus $$$ into the economy as a % of GDP (China and Japan top the list at 5% of 2009 GDP). The main argument against the Asian recovery: frugal US consumers will buy less Asian imports. However, this dependence may be inflated. One estimate cited that American consumers are responsible for only 5% of China’s GDP.
Global Monetary System Changes - All monetary and economic systems balance borrowers who like inflation and lenders who prefer no erosion in purchasing power. The system has changed from the “gold standard” to the “dollar standard” to floating interest rates, which has worked ok over the past few decades, but change is on the horizon. As the US owes other nations gazillions of dollars and has a trade deficit to boot, China will have a lot of power to determine where we go from here with respect to the global monetary system.
You Call That A Stress Test?!#@ - tests worked to assure investors that banks were not cooking books and that loss estimates were likely not grossly optimistic, they really are no indication that the banks are well capitalized and will be able to operate without government support anytime soon. Banks have been raising capital in equity markets recently and only GMAC seems to be at risk of nationalization.
Did I tell you that I have two PhDs? - Two smarty pants professors from Harvard and Chicago came up with a plan for how to regulate the leverage of banks by basing their risk on the price of their Credit Default Swaps. Basically, it says to let the market decide how risky a banks debt is and then regulate accordingly.
Don’t have a pot to piss in or a window to throw it out of, but at least I’m earning negative 30% interest on my bank deposits!! - Poor people in developing countries actually have to PAY rates of 30-40% for keeping their $$$ in “banks.” incredibly broke individuals are somewhat financially savvy. Through a combination of loans and savings they are able to work it out so that what they eat today does not depend entirely on what they earn today.
Hedge Funds had garbage returns but investors are still putting $$$ in them.
Astronomers get some new toys to play with - Shuttle program is drawing to a close next year. The crew of the Atlantis is currently on an 11-day mission to give one last makeover to the Hubble telescope. The upgrade should keep it running until 2014.
Homo Erectus - "Obscene" statue discovered in south-western Germany. Dates back to when homo sapiens arrived in Europe - adding further evidence that male thinking hasn't changed much in the last 35,000 years.
Watch out Google - Wolfram Alpha is the latest search engine, though its inventor (Stephen Wolfram) prefers to call it a "computational knowledge engine". Dissects questions into components and performs calculations to come up with an answer, which it displays in a myriad of charts, tables and graphs. Unfortunately it can only handle complex questions and comes up empty with simple searches, such as "climate change".
Living abroad gives you a creative edge - Two psychologists proved this via a bunch of weird experiments involving candles, pins and matches and a role playing exercise about negotiating to get a job at a gas station.
British Chiropractic Association happily promotes "bogus" treatments - Dr. Singh, a well-known science author in Britain wrote this in an article published during Chiropractic Awareness Week and was sued for libel by the BCA. He's now facing $150,000 to settle and his chances at appealing aren't that great. Lawsuit boils down to the definition of the word "bogus".
