The Putin - Formula One Connection

♠ Posted by Emmanuel in Entertainment,Russia,Sports at 5/09/2011 12:00:00 AM

Just a few posts ago, I discussed how Lider Maximo Hugo Chavez was backing the F1 career of Williams backmarker (read: habitual low-place finisher) Pastor Maldonaldo. Watching the F1 race in Istanbul on a lazy Sunday afternoon, I caught sight of another state-sponsored ride. So here's some crass commercialism care of the man who said that the collapse of the Soviet Union was the greatest geopolitical catastrophe of the 20th century.

As it turns out, the Soviet-era marque of Lada has been a proud sponsor of Renault F1 (or more latterly Lotus Renault GP) since 2010. Its sponsor's description is rather sinister and reminds me of, yes, Soviet-era propaganda with its odd fixation on the "military-industrial complex" (their Ike-worship, not mine):

In accordance with Federal Law No. 270-FZ “On the State Corporation “Russian Technologies” dated November 23, 2007, the main tasks of the Corporation are:
- assistance to organizations of different industrial sectors, including the military-industrial complex, in development and manufacture of high-tech industrial products;
- assistance in promotion and sales in domestic and foreign markets of high-tech industrial products and related intellectual activity results;
- participation in implementation of state policy in the areas of military-technical - cooperation of Russian Federation with foreign states and of the state program of armaments production and supply;
- attraction of investments into different sectors of industry including the military-industrial complex, for the purpose of development of competitive high-tech industrial products, including military products;

Creepy...what the heck does all that have to do with selling passenger cars? Just as Arsenal striker Andrei Arshavin is a noted proponent of PM Vladimir Putin's United Front in the English Premier League, so it appears that the erstwhile Russian leader is busy using F1 literally as a vehicle for increasingly the visibility of Russian-owned businesses. You see, Lada is now 25% state-owned, hence the sponsorship deal. From ESPN:

Probably the manufacturer least likely to be associated with Formula One, Russian car maker Lada has announced it will be sponsoring the Renault F1 team for 2010. The announcement, made by Russian prime minister Vladimir Putin, is linked to the signing of Vitaly Petrov as the country's first F1 driver. Putin said Renault's signing of Petrov is a "great symbol of cooperation" between the French marque and Russia.

"We will sponsor this activity [the F1 team] as a first step, and do not rule out later increasing our financial participation in the project," the prime minister told news agency EFE.

In 2008, Renault bought a 25% stake in Lada's parent company Avtovaz for US$1 billion, and it is reported that Renault's chief executive Carlos Ghosn may now look to increase its involvement. Although the car will carry Lada branding for 2010, there are no plans to change the team name.

Thank heavens the outfit became "Lotus Renault GP" instead of "Lada Renault F1" [!] What does a marque associated with producing crappy cars during the Soviet era have to do with a sport renowned for exhibiting engineering excellence? Beats me, pal. You learn something weird and new every time you watch the wacky world of F1, where geopolitics and sport mix to usually weird effect.

The somewhat creepy thing is that this team unlike present-day Williams gets a lot more camera time and hence exposure, with Petrov and teammate Nick Heidfeld having already finished on the podium this season.

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Intertwined Fates: bin Laden and the €500 Note

♠ Posted by Emmanuel in Cheneynomics,Currencies at 5/07/2011 12:00:00 AM

OK, so the absurdist image to the left was Photoshopped by someone with too much free time, but I have more sartorial commentary on bin Laden that is more factual. While we all know that the dollar is currently on another downward spiral necessitating another comical "strong dollar" statement from the hapless US treasury secretary (comical Tim-E?), let's again take stock of where it stands among household names whose familiarity is not necessarily down to wholesome activities. Brazilian supermodel Gisele Bundchen reportedly refuses to be paid in ratty US dollars. Meanwhile, gangsta rap artist Jay-Z sports a briefcase full of €500 notes in a music video--a far cry from when those engaged in this trade used to wear big gold "$" chains. These kinds of notes have also become favoured among the global gangster class (the real sort unlike Jay-Z & Co.) for whom money laundering is a regular activity alike walking the dog.

Although the existence of €500 notes is common knowledge, it's rather few of us who've actually seen it in person. Hence, they've become known as "bin Ladens" in British slang:

The 500 euro note, one of the largest denomination notes in the world, is being pulled from distribution in the United Kingdom. They are known in some countries as "bin Ladens" - the bank note everyone knows exists, but few people other than criminals will ever see. The decision comes after police linked 90 per cent of these notes in circulation to crime, tax evasion and terrorism. The UK's Serious Organised Crime Agency (SOCA), which has been studying currency trading, has concluded the 500 euro note is at the heart of money laundering because it is so easy to move.

It has come to pass in recent news reports that the eponymous Usama bin Laden (deceased) was found wearing a €500 note stitched into his robe along with two important phone numbers. This observation has occasioned some fanciful conjectures. F'rinstance, Slate has a novelty feature guessing how far bin Laden could have gone with this sum:

[U]sama Bin Laden had two telephone numbers and 500 euros in cash sewn into his clothes, CIA Director Leon Panetta told lawmakers this week. That's about $740, or around 60,000 Pakistani rupees. Presumably, if Bin Laden had evaded the SEALs, his disciples would have covered his travel, food, and lodging costs. But, hypothetically, what's the farthest you can get from Abbottabad on 500 euros?

You can read the rest at the link. However, I believe that we have some important political-economic commentary here that exceeds its sartorial value. Get this: even if bin Laden's brain had wasted away to the point that key phone numbers had to be sewed into his garments, he still knew that "strong dollar" policy was unreal from a hideaway with no fixed-line telephone or Internet. Aside from a $740 or so equivalent note being far handier than a $100 one, the hawkish bias of the ECB compared to its Federal Reserve free money counterparts is obvious even to what accounts suggest was an already doddering bin Laden.

And so it would have been written as an epitaph had American helicopter dropping operatives not dumped his body: 'Here lies Usama bin Laden. He died with a "bin Laden" stitched into his active wear.' If a senile rabble-rouser could figure out that holding dollars was a fool's game, well, I pity those who still do. Something else that's receiving an extrajudicial execution at the hands of America is, well, the US dollar.

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Exchange Rate Regimes and Soaring Food Prices

♠ Posted by Emmanuel in Agriculture at 5/06/2011 12:02:00 AM

While some would argue that America's unrepentant salvo of free money is a significant driving force behind food inflation worldwide (yours truly included), the Food and Agriculture Organization (FAO) has a more nuanced explanation. Even providing that the currency in which most foodstuffs are denominated in is on a long-term downward trend, today's market gyrations notwithstanding, the particular foreign exchange regime a country adopts as well as its status as a net food exporter/importer helps determine how well it copes with global price rises. To de facto peg or not to peg, and to the dollar or the euro? Hamlet never had it so easy compared to the decisions LDCs are faced with in this day and age. The following is taken from the FAO's Initiative on Soaring Food Prices - Guide for Policy and Programmatic Actions at Country Level to Address High Food Prices:

Meanwhile, here are some key talking points from the report:

There is emerging consensus that the global food system is becoming more vulnerable and susceptible to episodes of extreme price volatility. As markets are increasingly integrated in the world economy shocks in the international arena can now transpire and propagate to domestic markets much quicker than before.

Increased vulnerability is being triggered by an apparent increase in extreme weather events and a dependence on new exporting zones, where harvest outcomes are prone to weather vagaries; a greater reliance on international trade to meet food needs at the expense of stock holding; a growing demand for food commodities from other sectors, especially energy; and a faster transmission of macroeconomic factors onto commodity markets, including exchange rate volatility and monetary policy shifts, such as changing interest rate regimes.

What is more, financial firms are progressively investing in commodity derivatives as a portfolio hedge since returns in the commodity sector seem uncorrelated with returns to other assets. While this ‘financialisation of commodities’ is generally not viewed as the source of price turbulence, evidence suggests that trading in futures markets may have amplified volatility in the short term.

So aside from the helicopter dropping of dollars, we also have to contend with more extreme weather conditions (implicating global warming), the globalization of agricultural markets, commodity speculation, and the diversion of foodstuffs to biofuels. It certainly doesn't look like a promising scenario as far as food prices are concerned, making it imperative to study the link between FX regime and food prices.

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Americans Agree America's Future Stinks (Duh)

♠ Posted by Emmanuel in Cheneynomics,Hegemony at 5/05/2011 12:03:00 PM

Ah, the stench of American decay. Just a few hours ago, I heard Joseph "Soft Power" Nye--a worthy inaugural recipient of this blog's Carl Spackler Award for Cheneynomic analysis--outline his case that America's demise is much exaggerated. As you'll read below, I take issue with his argument that while the US may be in relative decline, it is not in absolute decline. But let's begin though with some decidedly non-rose-tinted analyses of America's prospects by regular folks. While deficits don't matter-style reasoning is nothing new as far as Americans academics are concerned, it's good to hear what Americans who live outside of ivory towers have to say instead of having USA#1 cheerleaders feed us a steady diet of Bush league bromides. Save it for the next Sarah Palin rally, buddy (as the Yanks would say).

Once again demonstrating you don't have to look far for IPE-relevant material, I came across this nugget on the Yahoo! homepage. A few posts back I used "green card" petitions as a gauge of just how much America stinks since skilled migrants are choosing not to go there in droves. No jobs, no future, no go. Well guess what: Americans themselves agree that America stinks. Due to a lack of jobs among other things, today's US youth is resigned to a living standard inferior to that of their parents'. The recent Gallup poll mentioned below is in a long line of polls asking basically same question "Will today's generation be better off than their parents'?" The headline says it all: "In U.S., Optimism About Future for Youth Reaches All-Time Low":

And here's the relevant accompanying text:

Forty-four percent of Americans believe it is likely that today's youth will have a better life than their parents, even fewer than said so amid the 2008-2009 recession, and the lowest on record for a trend dating to 1983.

Confidence in the traditional American dream--that each generation can work its way up in the world and have a better life than the previous generation--appears to be slipping away. Americans are less likely to believe this to be true today than at any time on record, including during the worst of the recent economic crisis.

Fewer than 4 in 10 high-income Americans--who presumably have the greatest access to opportunity and resources to gauge what the markets will do going forward--believe today's youth will be better off than their parents. This level of pessimism may also reflect the massive destruction of wealth that high-income Americans experienced from the economic meltdown.

Young adults, however, are mostly hopeful that today's youth will have a better living standard, better homes, and a better education than their parents. This optimism among youth -- their belief that tomorrow can be better than today -- is an important and hopeful sign, but it is possible that as they age, these young Americans will become more pessimistic, as their elders are today.

I've said this before and I'll say it again: The American dream is a fraud. (Perhaps criminally so in the case of the subprime crisis.) Now, there are three versions of this tall story: owning your own home, the land of opportunity, and a rising standard of living. First you have the idiotic "ownership society" variant which begat the housing bubble. As home prices keep tumbling with no end in sight, it's no surprise that homeownership rates keep falling, too. So much for that. Second you have the observation that intergenerational mobility is worst in Anglo-Saxon countries alike the US and UK [1, 2] where laissez-faire is supposed to promote more opportunity. No such thing, either. Third, Americans have good reason to be pessimistic about the living standard of future generations since median incomes have already been in decline for a decade. I learned about "extrapolation" in the fourth grade, and it's not a very difficult idea to grasp (unless you subscribe to mathlexic Cheneynomics, listen to Brooks and Dunn, or are a Tea Party acolyle, of course).

So there you go, Joe (Nye). The American dream, so central to its aspirations, is not supported by fact. Collapsing home prices, class immobility, and falling median income--if that's not outright decline, then my name's Abe Vigoda. Increasingly, Americans themselves don't believe in the American dream as it sinks further into Cheneynomic oblivion. Tell me this: where is the "soft power" of persuasion when your own people don't believe in this fraud? Few except the most deluded buy it, so you might as well consign it to the dustbin of history. The evidence is indisputable that America is in decline--and Americans are increasingly convinced of it, too.

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Key to Asian Consumers is...European Football?

♠ Posted by Emmanuel in Marketing,Sports at 5/05/2011 12:00:00 AM

And more specifically, UEFA Champions League football. Aside from attracting more global viewers than the Super Bowl, this Wall Street Journal article suggests (Western) advertisers seeking to make inroads into developing Asia can use the foremost European club competition as a vehicle:

"The global audience is huge," says David Taylor, UEFA's head of events. "Wherever you are in the world you can watch it. Research from partners, which we see when discussing renewals, shows that its value for money, although these are large sums involved."

For big advertisers, the regularity, exposure and global footprint of Champions League matches—the tournament attracts roughly 150 million TV viewers a week in 70 countries—has long made sponsoring the tournament an effective strategy for marketing to large groups of consumers.

There's also the challenge of monetizing sports viewers' attention to geerate off-the-air revenues:

All this comes as major European football teams are stepping up their efforts to draw Asian fans in the belief that the world's developing football markets offer growth potential both in terms of broadcast and other commercial rights.

Standard Chartered, the Asian-facing bank and lead sponsor of Liverpool FC, reinforced this point last month. "The market is saturated in Europe with so many clubs, how many more merchandise sales are they going to create over the next 10 years?" said Gavin Laws, the bank's sponsorship executive. "If the clubs want to do merchandise sales at an exponential rate you've got to be in China, you've got to be in Korea, getting all the people excited about the game."

Yet the biggest challenge for top clubs is how to turn fans in the world's most populous continent into profits. Tom Fox, the commercial director of 2006 Champions League finalist Arsenal, says the international profile of leading English Premier League clubs is out of proportion to their size, which should temper expectations of building a major marketing platform in overseas markets.

"Arsenal is a £230 million club in terms of revenue. Then there's Chelsea—slightly smaller—and Man United, which is bigger," says Fox. "They are all trying to build a brand independently around the world on multiple fronts, in North America, Asia and the European continent. But there are billion-dollar brands around the world trying to compete in China and failing."

As a useful comparison, the NBA itself has promoted basketball in Asia, while in football it's been down more to individual clubs. Is the NBA's effort more concentrated? Perhaps:

There is also a structural issue. While the leading European clubs are competing against each other for new fans, the task of building professional basketball in Asia has been undertaken centrally by the National Basketball Association, rather than individual franchises.

In other words, the NBA operates as a coordinating body that ensures that each of its teams benefits from the commercial opportunities available in China. "There is no duplication and there is a collaborative strategy ensuring that all franchises benefit," says Prof. Simon Chadwick, a professor of sports-business strategy and marketing at Coventry University in the U.K. Without a central coordinating body for European football, he says clubs are left to fight among themselves in what is arguably "a zero-sum game that demands a different strategic approach."

It would be much easier to develop individual club brands in international markets if Arsenal, Chelsea and Liverpool worked together, says Fox. "Do I think that all of the NBA clubs marketing all of their brands together is an advantage?" he says. "My answer simply, is yes."

Just as Formula One beings its races to Asia--China, India, Malaysia, Singapore, South Korea--it may be the case that physically bringing European football to Asia is what is required. Then again, friendlies in Asia would only further lengthen already long European campaigns. To be sure, there are a few bankable Asian football stars alike Ji-Sung Park of Manchester United, but my belief is that sponsoring local teams may be a better long-term route as the sport gains further traction in Asia. Certainly, major international sponsors can help pave the way for its growth there.

UPDATE: And speaking of Ji-Sung Park, sceptics thought earlier on that he only got into the Man U squad to sell memorabilia in Asia [!] His successes at the club have put paid to that, though it's taken quite some time to prove his worth for one of the world's most storied clubs (while selling lots of t-shirts and the rest of it). Maybe his example suggests European clubs taking on talented Asian players is the key to unlocking the Asian sports market...

It is not only the medals, this is a player increasingly appreciated by fans, media and teammates. Park has overcome the doubters who felt that he had been signed by the giant English club in order to help it sell shirts and do deals in Asia. The player, 30, has actually done so but only because he has been such a success on the pitch. He hasn't always been a regular starter for the club but when the big games come around, and for a team like Manchester United, there are lots of big games, his name can usually be found on the team sheet.

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Asia Learned From Its Financial Crisis; US Didn't

♠ Posted by Emmanuel in Cheneynomics,Economic History,Southeast Asia at 5/04/2011 12:01:00 AM

While visiting the website of those famous bond fiends PIMCO, I came across an interesting article on the resilience of Asian economies since the 1997-98 financial crisis. Chia-Liang Lian makes the case that Asia--particularly developing Asia--represents a good investment opportunity. This, of course, comes in tandem with PIMCO's Bill Gross famously dumping malodorous US Treasuries. Times are a-changin': Asian developing countries are now well-placed to secure better credit ratings as you'll read below, while the US is famously set to be downgraded in the likely event that its economolested finances deteriorate even further. While most of us have a mental image of developing Asian countries being reliant on the US market as an export destination, the reality is that the EU surpassed it as such quite a few years ago:
Lian cites reserves as self-insurance (perhaps overdone IMHO), emphasis on fiscal discipline, monetary prudence, and manageable impact from the Japan quake as reasons to expect Asia to carry on nicely. Especially in the fiscal and monetary arenas, there is certainly a contrast of crises evident: While Asian countries learned their lesson (and most European ones to a lesser extent), the United States' money-for-nothing policies have resulted in an unyielding depreciation of its currency and a concomitant disbelief in incredulous policy statements.

But let's not dwell on the hopeless and look at the bright side in Asia. Let's start with Indonesia which was pretty much ground zero of the Asian financial crisis. A scant twelve years on, it is on the brink of realizing investment grade status. Plus, its designation as such by two credit rating agencies should further bolster local capital markets as large institutional investors are given the effective "go" signal. From the Jakarta Post:

It has been more than 12 years since the 1998 Asian financial crisis, and Indonesia still has not managed to regain its investment grade status from rating agencies like Fitch, S&P’s and Moody’s. In the last few years, Indonesia has been blessed with relatively stable political condition, which enabled both portfolio and foreign direct investments to come in. This coupled with strong international commodities prices accelerated Indonesia’s economic growth, resulting in flushed foreign exchange reserves, which reached the highest ever at US$106 billion in March 2011.

The above trends translate to the maturation of Indonesia’s institutions and policy framework, as evidenced also by the easing of the country’s fiscal and external debt burdens stemming from the government’s track record of pragmatic fiscal and debt management policies.

The strong fundamental improvements that we have seen in Indonesia in recent years is the reason why Fitch is looking to upgrade Indonesia’s long-term foreign currency sovereign debt to investment grade sometime in the next 12-18 months. This move, when it materializes, will reinforce the market’s perception that Indonesia has been on the right track. More importantly, the upgrade, reflecting a safer investment destination, would make it possible for a wider universe of international investors, including massive US pension funds, to begin investing into the Indonesian stock market.

However, the real plus for Indonesia will come when a second rating agency also upgrades Indonesia’s rating as large US fixed-income investors, including pension funds and other institutional investors use the Lehman Aggregate Bond Index as their benchmark, which requires two investment-grade ratings in order for a bond to be included in the index. Worth noting is that once a rating agency upgrades, at least one would tend to follow within a year.

Another crisis-affected country to a lesser extent is the Philippines. Alike Indonesia, its macroeconomic picture is looking up, and it has just mounted a roadshow to convince the aforementioned credit rating agencies to consider upgrading it towards similar investment-grade status in the near future. With public debt reduced to 55% of GDP (North American debt lubbers take note: this is not a typo), it isn't a far-fetched goal:

The Philippines is wooing the three major credit rating agencies-—Moody's Investors Service, Fitch Ratings, and Standard & Poor's—-for an upgrade in its credit scores, as economic managers believe the country deserves it amid improving fiscal situation and external liquidity.

Finance Secretary Cesar Purisima told reporters on Thursday that he went recently to New York and Washington D.C. and met separately with representatives of the three credit rating firms. In the meeting, he presented fiscal and monetary data on the Philippines that he said should encourage the rating firms to lift the country's credit scores. He also reiterated the Aquino administration's commitment to meet its medium-term fiscal goals.

The Philippines is rated three notches below investment grade by Moody's, and two notches below the same by Fitch and S&P. Purisima said the credit rating of the Philippines has been lower than that of Indonesia, but added that the fiscal situations of the two countries have been similar. He also cited the country's declining debt-to-GDP [gross domestic product] ratio and deficit-to-GDP ratio. "Our debt ratios and deficit are declining, and our financial sector is well managed, and so we deserve better ratings," Purisima said...

The Philippine government has P4.7 trillion [about $109.6B] in outstanding debts, equivalent to about 55 percent of the country's gross domestic product. This has been brought down from over 70 percent a few years ago.

It remains utterly ludicrous how American deficit deniers believe that even looser money policies than those that brought on the US subprime crisis are the solution to what ails it. I guess the Asians learned from their crisis, but the Americans didn't. Their contrasting public finances tell the story, and even the habitually tardy credit rating agencies are coming around to this fact. Here is the PIMCO conclusion on Asia's sunnier side:

Our conviction of the resilience of emerging Asian countries leads us to be open to adding exposure as attractive opportunities arise. We continue to maintain exposure to emerging Asian currencies. We expect growing acquiescence to currency appreciation as an effective tool to keep imported sources of inflation in check. In this regard, the gradual appreciation trend in the Singapore dollar should remain intact. Despite recent gains, we believe the South Korean won and Chinese yuan remain fundamentally undervalued.

In external credits, select high grade, quasi-sovereign bonds in South Korea and India offer attractive reward opportunities for the risk. We look for avenues to “shake hands with governments” in countries where credit fundamentals are continuing on an upward trajectory. Specifically, Indonesia appears on track to potentially achieve investment grade status in the next twelve months. While the sovereign bonds have largely priced in the prospect of an upgrade, select higher-yielding corporate bonds offer an attractive risk-reward balance, particularly those that have demonstrated a consistent credit record. In the credit default swap market, we look to add, during periods of generalized market weakness, exposure to high quality sovereigns with strong credit metrics.

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A Class Analysis of Super Mario's Mushroom World

♠ Posted by Emmanuel in Entertainment,Marketing at 5/03/2011 12:01:00 AM

I was visiting the Yahoo! website when I came across an interesting-sounding feature on "Video Game Myths Revealed." Apparently, some folks with too much free time on their hands have made the preposterous (mock?) argument that Super Mario is a Stalinist communist based on the original Super Mario Brothers title. From the above video clip, they cite the following:

• he wears a lot of red;
• he gets more powerful with mushrooms (hippie/drug culture reference);
• he wants to overthrow King Koopa AKA Bowser (instead of Tsar Nicolas II);
  
• he pulls down the flag and raises one with a red star at the end of each stage;
• he has a strong semblance to "Uncle Joe" Stalin with his luxuriant moustache;
• he is super, while Stalin fronted a superpower

While this urban legend may sound plausible to some, a more careful analysis leads us to an entirely different conclusion. Not one to be outdone in silliness, let me try and shed more light in two ways. First, the Nintendo franchise is much broader than Super Mario Brothers I--a single entry in a vast if conflicting catalogue which Nintendo does not provide an official narrative to. Second, I will use a Marxist class analysis to determine the hierarchy in this familiar if understudied world. To be sure, class warfare is rife even there.

Who knows, I may even submit an article to The International Journal of Computer Game Research [!] if enough people take this silliness seriously. I must reiterate though that this is a preliminary sketch given limitations in the source material. Here are the main talking points:

Mario is a royalist fer crying out loud, not a communist - Let's talk about virtual geography and using the appropriate level of analysis. The Mushroom Kingdom where Princess Peach lives is but one of the many monarchies situated in the wider Mushroom World. Among others, there's also Sarasaland where Princess Daisy hails from and the Dark Land which the aforementioned Bowser reigns over. Applying Marx's theory of historical materialism, this situation is a product of material conditions in the Mushroom World. To wit, this world is in the feudal stage featuring rival aristocracies. The unique thing, however, is that this all transpires in a post-industrial mindscape. Alike in classic balance of power politics, Princesses Peach and Daisy naturally align against the rising power of Bowser and his "evil" machinations. (Although the Mushroom Kingdom is said to be one of the largest, its military expenditures pale in comparison to those of the Dark Land.)

In a crude Marxist sense, the predominance of Mushroom Kingdom dwellers Peach, Mario, Luigi, etc. in Nintendo games and its corresponding implications for revenues drives Bowser to seek its conquest time and again by kidnapping Princess Peach. Which, of course, has the paradoxical effect of increasing royalties to the Mushroom Kingdom since Nintendo must publish yet another "Bowser kidnaps Peach; Mario must rescue" title as a result. Alike dollar hegemony in our world, this is the central political-economic tension in Mario's.

Mushroom World has a speciesist bias that leads to obvious inequalities - There is, unfortunately, not an uncommon anthropomorphic form of discrimination in make-believe worlds. Why must humanoid characters have predominance over other sentient beings who seem as capable as they are? Toad is a case in point. In Super Mario Brothers II, Toad actually has the greatest abilities alongside Mario, Luigi and Peach. Yet he continues to be marginalized and has not received a (semi-)starring role since 1988. Rather, the commodified depiction of Toad as a category of lookalike serfs in the Mushroom Kingdom continues his exploitation despite possessing extraordinary talents we occasionally become aware of.

Thus, Bowser's continuing obsession with kidnapping and marrying Princess Peach is his attempt to reduce speciesist bias by hopefully siring more human-like offspring instead of, well, Bowser Jr. (who doesn't get far like his dad in genteel society or aristocratic circles). Bowser = Middleton? Just a thought. Instead of trying to marry up in this messed-up virtual arena, Donkey Kong has chosen to live in a non-imperialist realm elsewhere in Mushroom World. Still, the oppression becomes intolerable that Donkey Kong too has had to resort to kidnapping Mario's girlfriend in the eponymous video game--but only for that instance and not with Bowser-like determination. Nevertheless, if you are in search of a real revolutionary in Mushroom World, it would be Donkey Kong and his nephew Diddy Kong. Offhand, I would say that the Mushroom Kingdom has a Gini coefficient somewhere between 0.70 and 0.80, while that in the less hierarchical Kong environs it's somewhere in the range of 0.20 to 0.30.

Mario's fake populist affectations remind me of New Labour architect Peter Mandelson, not Stalin - Let's get this one straight: Mario is a plumber the same way that Sir Tom Jones was a bricklayer. (Both are master showmen feigning humbler occupations.) Having long ago discovered his cash cow potential, this most recognizable and bankable of video game stars is no lumpenproletariat. Again, that would be Toad(s) in the Mushroom Kingdom or Goomba(s) in the Dark Land (who do invade Mushroom Kingdom when Bowser kidnaps Peach; hence the confusion in the clip above). Actually, Mario and his moustache do not so much remind me of "Uncle Joe" Stalin but of Lord Mandelson during his left-ish era. And yes, Mandelson had a nice 'stache during the time he worked as an economist at the Trades Union Congress.

Here's a question for you: in how many games does Mario actually do *plumbing* instead of beating up Koopas and Goombas and all that glamorous stuff? Few and far between. Just as Lord Peter Mandelson would much rather hang out with the likes of oligarch Oleg Deripaska in Corfu than with slovenly "Peace Camp" protesters in Parliament Square, so does Mario have a hankering for the good life. We all know there's a Mario's Castle that literally gives the charade away. And boy is he ever well-compensated; a true petit bourgeoisie even in stature as Princess Peach is taller than he is.

Controversially, Nintendo is the commercial rights holder to Mushroom World - In Formula One racing, Berine Ecclestone invites envy for being the ringmaster to the entire show. Still, you cannot begrudge his skill in marketing the whole enterprise. And so it is in the Mushroom Kingdom as Nintendo has parlayed a thin "Bowser-kidnaps-Peach" storyline into a monster franchise. Just to show you the drawing power of filthy lucre, this collection of antagonists and imperialists collaborate in sporting pastimes if the commercial allure is strong enough: Mario Kart, Mario Tennis, Mario Golf, Mario Baseball, Mario Hoops, Mario and Sonic Olympics, etc. all feature ostensibly hostile characters engaging in sporting competition. Indeed, Nintendo has even introduced purpose-built doppelganger villains for pure commercial gain despite the narrative discontinuities of Wario and Waluigi. I won't even get into Nintendo co-opting Sega's characters and wiping out the latter's console-selling aspirations.

Likely, there has been much Disneyfication of Mushroom World. I am sure things such as pixel abortion and pixel euthanasia exist, but they are all sanitized to sell to a pre-teen audience the world over in a formula perfected by that elder stripe of master animator.
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So there you have it. Super Mario is not about communist revolution but of rival imperialists--Mushroom Kingdom and Dark Land, especially--contesting dominion over the wider Mushroom World. Do not be fooled by inter-character sports games, either. They're as jingoistic at heart as the 1936 Munich Olympics if you scratch beneath the surface. We all know what came afterwards. Mario--who has a castle of his own, don't forget (not bad for a "plumber")--is at heart a true royalist whose allegiances are strongly conditioned on...material interests.

Next time up (if there ever is one): I will use my namesake Immanuel Wallerstein's work to develop Modern World Video Game Systems Theory where the concepts above will be fleshed out further. Looking back, I've also neglected to explain the enigmatic Yoshi. While you can pretty much figure out which lands will occupy the core, periphery, and semi-periphery, I have yet to sort out Nintendo's overarching spatial configuration in the grander scheme of things. Circuits of capital linking Mushroom World with ours and all that transboundary stuff.

NOTE 1: Forbes values Princess Peach's net worth at $1.3 billion and at #15 on the Forbes Fictional 15. I honestly doubt whether such a paltry sum could maintain the splendour of the Mushroom Kingdom. Moreover, I am shocked--shocked!--by the insinuation that she is divorced from Super Mario. Again, there is no Nintendo game storyline that supports this unwholesome allegation. What kind of girl do you think she is...married to a Windsor?

NOTE 2: Given that I have devoted much space on this blog to sports since we spend considerable time and money following them, I believe we should now devote some attention to video games--the signature form of entertainment in the digital age. There are interesting and surprisingly nuanced boundary-spanning politics in the virtual environments which many of us have voluntarily chosen to enter.

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Special FX: What is 'Strong Dollar' Policy, Exactly?

♠ Posted by Emmanuel in Cheneynomics at 5/02/2011 12:01:00 AM

My, my, my--have we been here before. And I suspect we have far from heard the last of it lest 'weak dollar' policy becomes a rhetorical favourite in certain parts of North America. When it comes to sheer hypocrisy, the 'strong dollar' policy quite possibly tops a very lengthy list of vapid statements emanating from American officials. Originating from the Clinton administration--more specifically Robert Rubin's selection as US treasury secretary--all who've succeeded him have been made to repeat this mantra regardless of the actual value of the dollar. Larry Summers is arguably the last to have put his mouth where the dollar was at. Meanwhile, the Bush tax cuts, the bursting of the dot-com and housing bubbles, and military adventurism have taken their toll on the state of American finances as America transitioned into Bush 43's "big government conservatism."

Just as Bush's treasury secretaries Paul O'Neill, John Snow, and Henry Paulson famously had to repeat the "strong dollar" line, so does Obama's own Tim Geithner. If anything else, Obama has overseen an even more remarkable deterioration in US finances. Hence, as the dollar flirts with all-time lows on any number of fronts, what I previously mentioned has come to pass: To avoid an outright rout of the US dollar but not actually help in any substantial way, Geithner was forced to repeat the increasingly empty 'strong dollar' line late last week. (Footage of Geithner's speech is available online.) Anyway, on to the Bloomberg report on this sorry restatement of a transparent falsehood:

Treasury Secretary Timothy F. Geithner today reaffirmed the U.S. commitment to a “strong dollar” and said the country won’t weaken the currency to gain an advantage over its trading partners. “Our policy has been and will always be, as long as at least I’m in this job, that a strong dollar is in our interest as a country,” Geithner said in remarks at the Council on Foreign Relations in New York. “We will never embrace a strategy of trying to weaken our currency to try to gain economic advantage [my emphasis].”

Geithner’s comments, in response to a question about the dollar’s recent decline, show his efforts to reassure investors that the U.S. will restore long-term economic growth and stability. The Treasury chief said the U.S. must earn investor confidence “over time” and said there’s “fundamental” trust in the U.S. ability to cope.

If only the markets had more belief in this pronouncement. Maybe he should repeat it some more as others don't seem to be listening yet:

The dollar dropped for a sixth day against the euro, matching the longest losing streak since May 2009, on speculation the Federal Reserve will consider measures to keep yields low to support the U.S. economy. The greenback also fell to almost the lowest level since August 2008 against the currencies of major U.S. trading partners...

Geithner said today that the U.S. needs a “credible strategy” to reduce its budget deficits over time, without moving too quickly and choking off economic recovery. “You have to commit to bring the budget deficit down to a level that will put our overall debt burden on a declining path as a share of the economy,” he said. The Obama administration wants to move onto that path by about 2015, he said.

The thing is, of course, that there is no guarantee that the Obama administration will still be around come 2015. Geithner then gets back to the immediate need to raise the US debt ceiling from its current $14.3 trillion lest it be breached come 19 May. Which of course is jarring insofar as calls for fiscal responsibility are mentioned in the same breath as pleas to be given the permission to issue more debt:

Geithner also said Congress needs to act by June to raise the debt limit, saying it would be “irresponsible” and “unacceptable” not to act. “The idea that the United States would take the risk people start to believe we won’t pay our bills is a ridiculous proposition,” he said. Congress is facing a vote as early as next month on raising the $14.3 trillion debt ceiling. The Treasury Department projects that it will hit the cap on May 16, though it could use emergency measures to avoid default until about July 8.

The chairman of the Treasury Borrowing Advisory Committee today said it would be “catastrophic” if the U.S. did not raise the limit. The advisory committee includes representatives from firms including Goldman Sachs Group Inc. and Bank of America Corp. “Any delay in making an interest or principal payment by Treasury even for a very short period of time would put the U.S. Treasury and overall financial markets in uncharted territory, and could trigger another catastrophic financial crisis,” Matthew Zames, chairman of the advisory panel, wrote in a letter to Geithner released in Washington today. Zames is a managing director at JPMorgan Chase & Co.

Geithner then mentions high oil prices as a hindrance to America's economic recovery without mentioning the likelihood that a weak dollar is in reality causing price spikes in many commodities--including oil:

Geithner said today that oil prices have become an obstacle to growth for the U.S. economy, which is otherwise set to accelerate. “We started the year with a little less momentum,” Geithner said. “We’ve got some new headwinds, most prominently of course in oil,” Geithner said. “What’s happening in oil is obviously potentially very significant. At current levels, on its own, it won’t put the recovery at risk.”

So what exactly does he mean by "strong dollar" policy that is not evident to me? By any conventional measure of the dollar's value--the broad index or major currencies index in nominal or real terms, the real effective exchange rate, etc--the US dollar is slumping towards all-time lows once more, period. There's also the charge that American free money policies are causing speculative flows to buoy commodity values he has yet to rebut as mentioned above.

This sort of hooliganism (see my comments on 'strong dollar' bulls--t being typical Yanqui behaviour) reflects an increasingly incoherent America. As its massive deficits inevitably weigh on its currency, it no longer possesses the willingness or ability to shore up its currency. In other words, it is more than willing to take dollar holders for another in an endless series of rides. That is, "strong dollar" statements no longer carry the weight they did during the Clinton administration. When you can no longer convince others of the integrity of your currency but have to resort to cheap talk which is totally disconnected with reality, well, the lie is revealed all too easily. Uncle Sam is a confidence man.

And if you're dumb enough to hold dollars--or believe 'strong dollar' talk for that matter--there's no one to blame but yourself.

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Migrants Agree America Stinks, H-1B Visa Edition

♠ Posted by Emmanuel in Americana,Migration at 5/01/2011 12:01:00 AM

Let's have a look at some figures that indicate the relative attractiveness of the United States as a destination for economic migrants at the current time. Sometime ago I wrote about Chicago School economist Gary Becker's plan to charge foreigners $50,000 for the privilege of America citizenship [whoopee!] Or, more accurately, the privilege of being saddled with $14.3 trillion in US debt with far more to come--a significant part of which will likely be owed to countries they brainlessly left in the first place. I'm proud not to be American, for at least I know I'm free from being a debt slave to the grind.

Anyway, I have been a keen follower of migration trends in general--especially under the H-1B visa category for skilled workers AKA the "green card." See my previous post on the matter. In previous years, the cap of 65,000 eligible petitions would be filled literally within days of becoming available. Since the subprime crisis, though, let's say many have come to their senses and began contemplating a number of things:

1. There are more jobs to be found in India and previous H-1B-heavy sending countries than America at the current time;
2. The United States is scaring away productive migrants with its heavy-handed post 9/11 tactics;
3. American employers are hard up;
   
4. America is an increasingly unattractive destination due to its ever-declining global standing.

The Economic Times has a pretty good article relating how Indian IT professionals have become, as The Clash once sang, so bored with the USA. Like during the past two years, H-1B is drawing flies once again this year:

The H-1B visa, the most sought after by India. IT professionals has opened to a lackluster response, with less than 6,000 applications received after it opened on April 1...US businesses use the H-1B programme to employ foreign workers in specialty occupations that require theoretical or technical expertise in specialized fields, such as scientists, engineers, or computer programmers.

The H-1B cap for the fiscal 2011 was reached in January this year and on December 22 for the fiscal 2010. Till a few years ago the cap was reached within the first few days of USCIS starting to accept H-1B petitions. As a result, USCIS had to resort to computerized draw of lots to determine successful applicants.

Because of stringent monitoring provisions and general economic recession, there has been a sharp drop in the number of Indian receiving H-1B visas in the last few years, official figures reveal. For instance the Infosys which received as many as 4,559 H-1B visas in the fiscal 2008 and was on top of the list of companies receiving this coveted work visa for professionals; received just 440 H-1B visas in the fiscal 2009 (October 1, 2008 to September 30, 2009), according to the latest figures released by the US immigration services. Similarly, Wipro, which in 2008 got 2,678 H-1B visas, received just 1,964 H-1B visas in 2009; but still topped the list in the fiscal 2009.

US Citizenship and Immigration Services (USCIS) figures pretty much back up this trend as April draws to a close:

If skilled (read: smarter-than-average) migration under H-1B is a useful barometer for the attractiveness of living in America a decade into the twenty-first century, consider it a big "NO." I hope Gary Becker, Nobel Prize winner in Economics, can understand what the supply and demand curves imply here for his far-fetched ideas. Framed properly, it's a matter of paying migrants to come and work in America (land of the bankrupt) given their ever-dwindling appetite for doing so. As the title of this post says, smarter migrants agree America stinks by simply not going there. Face it: nobody's beating a path to America's door. And it should read:

Attracting the best and brightest? You must be joking.

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World Bank Lends for Worker Repatriation from Libya

♠ Posted by Emmanuel in Bretton Woods Twins,Middle East,Migration at 5/01/2011 12:00:00 AM

Well this is a somewhat newer form of lending that just shows you the increasing prominence of migration not only in the headlines but in development work in general. Once more, it seems our friends from Bangladesh have felt the brunt of global events. If there is a country that has been terribly unlucky with fate practically from its very inception, it's Bangladesh.

Unfortunately, no one should be surprised that many of our Bangladeshi colleagues find themselves stuck amidst an ongoing conflict in Libya. Unlike, say, the Philippines with its comparatively sizeable apparatus for handling economic migration, the public management of migration flows is less formal in Bangladesh. To help resolve matters, the country has now been granted loans by the World Bank's concessional lending arm the International Development Association (IDA) to fund repatriation from Libya. While nearly half are now safely home, some 36,000 or so remain in Libya:

The World Bank today approved $40 million for the Repatriation and Livelihood Restoration for Migrant Workers Project in support to the Government of Bangladesh for repatriation of its migrant workers escaping the ongoing conflict in Libya. In addition to bringing them back to their home country, the project will provide a one-time cash grant to help returning migrant workers meet immediate needs.

“Migrant laborers have contributed mightily to sustained growth and development in Bangladesh. Their remittances fuel domestic investments throughout the country and boost consumption to alleviate poverty,” said Ellen Goldstein, World Bank Country Director for Bangladesh. “It is fitting that Government would support them in their time of need, and the World Bank is pleased to be able to respond to Government's request for support within just a few weeks’ time.”

Libya has been a host-country for migrant workers from Bangladesh as well as from other countries in South Asia, East Asia, Sub-Saharan Africa, and other countries in the Middle East and North Africa. An estimated 70,000-80,000 Bangladeshis were working in Libya before the crisis of which about 34,000 have since returned due to the security concerns.

The project will finance part of the cost of transport of returnees and provide a one-time $775 cash grant following their return to support their immediate needs while additional donor funds will help returning workers seek available employment opportunities.

“The crisis has created a very serious situation requiring humanitarian support by the international community,” Bernice Van Bronkhorst, Project Team Leader said. “For those who have only recently migrated, this crisis has not only rendered them penniless but heavily indebted. The project is designed to help them get back on their feet. ”

The $74.1 million project is supported by a $40.0 million World Bank Credit in conjunction with a government contribution of $4.6 million and $29.5 million by donors through the International Organization for Migration (IOM), which will implement the project on behalf of the Government of Bangladesh.

The credits from the International Development Association (IDA), the World Bank’s concessionary lending arm carries a maturity of 40 years with a 10-year grace period with a 0.75 percent service fee.

It's a sign of the times, I guess. Development concerns are a-changing, and migration is one of the more prominent items on today's checklist.

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