"Axis of Oil," Kennebunkport, Etc.

♠ Posted by Emmanuel in , at 6/30/2007 01:21:00 AM
You guys and gals who tune in to the US-based financial news media should be familiar with the peripatetic and irrepressible Phil Flynn. This guy is simply everywhere. Until recently, I was unaware that he had a blog on the website of the firm he works for--Alaron Trading. While I don't always agree with him, he usually makes lots of lively commentary. To set the background for this week's increase in oil prices, let's get some quotes in the Wall Street Journal from (surprise!) Phil Flynn. To be honest, I see little connection between the attempted bombings in London to higher oil prices Stateside due to fears of attacks on...
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BRICs Challenge US in Energy

♠ Posted by Emmanuel in , at 6/30/2007 12:17:00 AM
The current issue of the Economist features an article on how America has been weakened by--among other things--its troubles in Iraq and Afghanistan, its diminished "soft power," and its continued abasement of the US dollar. Repeated yet again is the economic challenge of the so-called BRICs (Brazil, Russia, India, and China) countries. As Gideon Rachman has pointed out, Goldman Sachs research estimates that China will surpass the United States in real GDP terms sometime in the mid-2020s. However, the Economist did not really focus much attention on the current usurpation of the United States and Europe as well by the BRICS...
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Living Without "Made in China"

♠ Posted by Emmanuel in ,, at 6/29/2007 08:31:00 PM
Reuters has an interesting recent story of an American family trying to live (survive?) without buying any stuff made in China for a year. This story coincides with the release of a new book by Sara Bongiorni entitled A Year Without "Made in China": One Family's True Life Adventure in the Global Economy. Her family's story is featured in the book. My initial thought upon reading the title of this thing was, "well, that's impossible" as that nation has become the workshop to the world. Ultimately, Bongiorni comes to nearly the same conclusion as she ends her quest. Although several recent books have provided thoughtful accounts...
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Rupert Murdoch, "The Last Tycoon"

♠ Posted by Emmanuel in at 6/29/2007 07:28:00 PM
The latest issue of TIME Magazine has an extensive feature on Rupert Murdoch that you might be interested in, especially if you read the previous post I featured on his China offensive. Here, TIME discusses in more detail Murdoch's attempts to win over Dow Jones' Bancroft family, which has owned the firm for over a century: Two months earlier, at a secret March 29 breakfast in the News Corp. building, Murdoch had told Dow Jones CEO Richard Zannino about his $60-a-share offer for the company — a staggering price for a stock that had been trading around $36. But the family that has controlled Dow Jones for more than 100 years, the Bancrofts, at first rejected Murdoch's bid because some of its members loathed his tabloid style and feared he would trample the Journal's independence. The family haggled for two weeks over a proposal designed to buffer the Journal's newsroom from Murdoch. A few hours earlier on this Friday afternoon, Zannino had called Murdoch to say the proposal was...
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Paulson on Private Equity + Hedgies

♠ Posted by Emmanuel in at 6/28/2007 12:49:00 AM
The clip above from the Wall Street Journal Deal Journal shows Treasury Secretary Henry Paulson defending the status quo of tax treatment for private equity and hedge funds at the WSJ's "Deals & Deal Makers Conference" [yes, well, what did you expect?] If you will recall, a raft of legislation on limiting the perceived tax advantages gained by private equity and hedge funds has made the news.Democrats in the U.S. House of Representatives introduced a bill on Friday that would more than double taxes on the pay of managers of private equity funds, hedge funds and other investment partnerships.Throwing down a challenge to some of the nation's savviest and richest financiers, the bill would set a higher tax rate for "carried interest." That is the 20-percent cut of profits beyond targeted returns typically kept by senior managers of private equity firms and other firms on major transactions.The bill, introduced with the backing of two senior Democratic committee chairmen, ratcheted...
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Policing Human Trafficking

♠ Posted by Emmanuel in at 6/28/2007 12:38:00 AM
This informative guide on the policing of human trafficking comes from, of all places, the International Association of Chiefs of Police. As human trafficking is a widespread problem, however, the IPE Zone is obligated to cross interdisciplinary boundaries to bring you the latest from whatever field. Contained herein are advice on the following:Definitions of human trafficking and the various forms of exploitation Distinctions between trafficking and smuggling Dynamics of human trafficking and the traumatic effects upon victims Strategies for victim identification and assistance Methods for effective response and investigation...
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Upcoming Water Wars in Asia

♠ Posted by Emmanuel in , at 6/28/2007 12:21:00 AM
China's relentless attempts to muzzle all dissent in Tibet may strike some as unnaturally harsh, especially when it comes to dealing with the Dalai Lama. The International Herald Tribune, however, points out that Tibet has great strategic significance as its glaciers are the wellspring for many of the region's major bodies of water. Water is not especially abundant in Asia, and quarrels over this precious natural resource are set to ratchet up as countries become more progressive and demand more water. China's continued exploration of damming projects has naturally elicited complaints from countries that lose out from rerouting...
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Rupert Murdoch's China Offensive

♠ Posted by Emmanuel in at 6/28/2007 12:04:00 AM
Here's an interesting article on Rupert Murdoch's attempts to spread his media empire to the Middle Kingdom by building up guanxi with the Chinese leadership and business elite. Having done so already in the UK, Australia, and the US, Murdoch mixes the personal with business in pursuit of profit$ in China. His Chinese wife, Wendi, figures large in his charm offensive to enter the Chinese media market. The Chinese leadership seems to cotton up to Mr. Murdoch more than most media barons as he is willing to parrot the Party line and muzzle his operations accordingly. From the New York Times:Many big companies have sought to break...
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Scrutinizing Sovereign Wealth Funds

♠ Posted by Emmanuel in , at 6/27/2007 02:14:00 AM
Unocal, Global Crossing, P&O...the list of American firms that have been prohibited from being owned by foreign investors supposedly for security reasons runs long. Two recent features have made me think about this issue once again. As you know, America keeps on piling on debt, yet expects foreigners to remain content with buying relatively low-yielding US bonds instead of equity stakes in American companies. However, the recent trend of bigtime reserve accumulators creating "sovereign wealth funds" (SWFs) to invest these proceeds in equities is bound to again rouse, shall we say, protectionist passions in America. Let...
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Is Zoellick a "Wolfowitz Lite"?

♠ Posted by Emmanuel in at 6/27/2007 01:25:00 AM
A few moons ago, I described how incoming World Bank President Robert Zoellick has pretty impressive "neocon" credentials. Now, it seems that Zoellick will retain Wolfowitz's strong rhetoric on anti-corruption. If you will recall, Wolfowitz brought two longtime cronies to the World Bank, Kevin Kellems (the "keeper of the comb") and Suzanne Rich Folsom who heads the "Department of Institutional Integrity" [nice title, eh?] Kellems resigned before his boss's early departure, but Folsom is still there, presumably to the chagrin of World Bank veterans. One of the things World Bank watchers will be awaiting is what sort of role Folsom will have under Zoellick. As the International Herald Tribune notes, she's not terribly well-liked. Zoellick needs to rebuild a semblance of trust with World Bank staffers that was put under stress by Wolfowitz. How he deals with Folsom will be interesting to watch:Combating corruption was a signature issue for Paul Wolfowitz in his two stormy years...
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EU's Horse Trading with China

♠ Posted by Emmanuel in ,, at 6/27/2007 01:16:00 AM
The Wall Street Journal notes that the EU is trying a new tack with China aimed at getting the latter to move more quickly on the matter of intellectual property (IP) protection. By designating China as a market economy well ahead of time, the EU may get a better response from China, or so it hopes:In the struggle to manage its rising tide of Chinese imports, the European Union is considering a subtle but important shift in its approach to Beijing. The EU strategy, which people familiar with the matter say is still under discussion, would be to offer China recognition as a "market economy" in the hope of extracting a range of concessions the Europeans deem crucial to balancing the trade relationship. While the shift would largely be a technical matter, it is a priority for Chinese trade officials and does offer practical gains. Beijing would find it easier to defend against persistent European complaints that Chinese goods compete unfairly with local manufacturers. In trade jargon,...
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Pope Benedict XVI on Globalization

♠ Posted by Emmanuel in at 6/27/2007 12:38:00 AM
As a very well-informed doctrinaire, it is of very little surprise that the Pope offers some thought-provoking words on globalization. While he sees opportunities to be gained from improved material conditions, he also acknowledges that globalization needs to more clearly pronounce human well-being as its end. Typical arguments for globalization discuss enhanced economic efficiency; however, the Pope offers suggestions on how it can serve, yes, a greater calling. Like several others, the Pope in concerned with equity as well as efficiency. Zenit offers a concise statement of the Pope's thoughts on the subject:Amid the ongoing...
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J-Curve, Mugabe, and the World Cup

♠ Posted by Emmanuel in at 6/26/2007 12:43:00 AM
Ian Bremmer's recent book The J-Curve presents a simple thesis. Take a look at the illustration taken from the Daily Telegraph review of the book. Openness increases as you move from west to east, while political stability increases as you move from south to north. According to Bremmer, the least open regimes (like North Korea) tend to be more stable than those undergoing a transition to openness which are least stable (like Iraq), while those that are most open are also the most stable (like the US).I bring this matter up for I recently came across this article in The American which illustrates J-Curve reasoning. Sanctions...
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EU's I'm-Hurt-By-Globalization Fund

♠ Posted by Emmanuel in at 6/26/2007 12:35:00 AM
Somehow, I am not surprised to learn that the French are the first to take advantage of the EU's new "globalization adjustment fund". From Agence-France Presse:The European Commission on Monday approved the first two payments of cash from a new EU fund aimed at cushioning the impact of globalisation.Small companies that supply French car makers Peugeot-Citroen and Renault will receive 3.8 million euros (5.1 million dollars) to help "workers made redundant due to company failures in a climate of changing global trade patterns," the EU executive said.Commission spokeswoman Katharina von Schnurbein said the money would be disbursed once EU member states and the European Parliament gave their approval, which could take "three or four months."The fund was set up at the end of last year to help workers who lose their jobs because of globalisation get back to work.Schnurbein said that other candidates for cash from the fund were "in the pipeline," including the Finnish telecoms sector...
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US Bullies Antigua in the WTO

♠ Posted by Emmanuel in , at 6/26/2007 12:01:00 AM
Previously, I detailed the case of the tiny island nation of Antigua and Barbuda winning its case against the US over online gambling restrictions. If you will recall, Antigua was severely hurt when the US effectively banned offshore online gaming operations from plying their trade Stateside. The significance of this matter is perhaps far greater than the stillborn Doha round. Can the US simply flout the WTO's rule-based regime by ignoring its decisions? It would be terribly unfair if this matter is not resolved in favor of Antigua. Hearteningly, several other countries have now joined Antigua to face down America's bullying tactics. Things will come to a head when the WTO's judicial system, the Dispute Settlement Body (DSB), meets on July 24:Important questions will be raised in Geneva on July 24, about whether rules based on international systems can be used by the relatively powerless (Antigua), if the most powerful (United States), chooses to ignore or circumvent the World...
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