In a previous post I suggested that our public infrastructure is in need of a lot of repairs and governments haven’t been setting aside the necessary funds. What about our personal infrastructure and by this I mean maintaining our bodies? For many of us as we get older we’re going to start relying on the healthcare system more and more. So how’s it going with the healthcare system?
In the U.S. you have a system of private healthcare that’s outrageously expensive for many Americans, to the point where 50 million Americans don’t have healthcare. President Obama has been trying to create a system that will provide affordable insurance for everyone but he seems to be encountering rapidly increasing resistance.
Here in Canada we get pretty smug about our universal healthcare. And why not, it’s a fantastic system, and we chose its inspiration, Tommy Douglas, as The Greatest Canadian. But are we going to be able to maintain it in the future?
In preparation for a presentation I did this past fall I researched what was happening provincially. In 1999 when our Premier was Mike Harris, the province spent $18.9 billion on Healthcare. Ten years later in 2009 we spent $43 billion. So I asked people in the workshop, does this look sustainable to anyone? Does anyone think we can continue to grow our healthcare expenditures at 7% a year?
What’s happening federally? In 1998 the Federal Government transferred $60 billion to the provinces for healthcare. In 2009 it was $129 billion. Shall I ask again? How long do we think we can keep this up? Government revenues are not growing at 9% a year. In fact to get elected our current Prime Minister, who is an economist, did what every other economist in the country said was a stupid idea and cut the GST. So let’s see. Government revenues going down. Just one component of expenses going through the roof. And there are going to lots of other areas screaming for money too.
And now the really scary news, the baby boomers are just starting to hit the age when they’re really going to start using the system. The reality is that the bulk of health care is spent on the last years of people’s lives and we’re about to have a huge bulge of the population enter that stage of their lives.
What we need to be having right now is really tough discussions about how we can maintain the systems we put into place many years ago. They’re about to start crumbling under their own weight and from the lack of attention.
The 50 million Americans without healthcare have already had to come to grips with this. Millions more have inadequate protection. All my experiences with the Canadian public healthcare system have been great, but I sense the days of us being able to maintain current levels of service are over.
Sorry for the reality check, but you need to come to grips with the fact you’re going to be increasingly on your own in the future, just like your grandparents were generations ago. So get healthy. Eat your vegetables. Grow your own vegetables. Get a bike. Start walking. Eat less animal products and move your diet to a plant-based one. Give up the gas-powered lawnmower and get a push mower. It’s all related. Everything you do to prepare for the end of cheap oil will also make you healthier. You can either embrace reality or let it hit you like a freight train.
The purpose of science is to be able to” predict outcome,” relative to verifiable factual information. The more verifiable facts in your possession, the more probability that what you state is true, is actually true.
The evidence is overwhelming that as sure as day follows night and that opposites attract and also repel.
The interaction of opposites is predictable. It is also scientifically accurate to state that physical and social change will take place as a consequence of this interaction of opposite forces.
With the knowledge of the basic nature of what exists, it is possible to predict what the character will be that will naturally flow, from that basic nature.
All things everywhere are constantly changing. This change, according to science, occurs as something that is sometimes gradual and sometimes sudden and abrupt.
All change develops and matures in steps and stages.
Everything that comes into being eventually will go out of being because that what no longer exists is replaced by that what is more in harmony with that, what is the changing conditions. The conditions being, the nature and character of the environment.
I predict scientifically, that “COMPETITIVE CAPITALISM” on a NATIONAL STAGE, will advance to the stage where the diametric opposite stage will take place, and that is the stage of ” “COOPERATIVE CAPITALISM on a GLOBAL STAGE.”
This is a scientifically accurate prediction and is becoming clearer with the passing of time, that the large economic entities are merging in increasingly larger exclusive Global Multi-Nationals that cooperate with each other so that they can arbitrarily control the worlds supply and the world’s demand, for the world’s resources, thus determining the climate of when to buy cheap and sell high.
In other words Free Enterprise has changed to the opposite of what it was. It is now a Controlled Private Enterprise.
American Capitalists are no longer National Patriots that are patriotically concerned with the well being of American Labor, Small Business and the American Consumer, they have moved on to the world stage, and they, as a world class of dominators, will cooperate among themselves, to enrich themselves, by exploiting all those that are not of their cooperating world class, of world dominators.
This state of being can only be described as “WORLD FASCISM!”
This is happening now and it will become more extreme with the passage of time.
Those that want to go backwards to the time of small business dominance, and the rugged individualism of our historical past, has missed the train that only moves toward the future.
So the local paper in Hampton roads ( Virginian Pilot ) publishes the Real Estate Report by The Associated Press. Here is my spin !
I was just reading an article in the Virginian Pilot about the state of the housing market. Its up, its down, its up its down. I swear I feel like Im on a roller coaster. SO lets look at the national statistics.
1. Homes prices fell 12% last year (here is the gloom – Sharpest drop since the GREAT DEPRESSION, really we have to know that !)
2. Median sale price is now at $173,500 (here is the good – YEA people can afford the homes now) Down 23% from the PEAK in 2006
3. Home sales are up 21 % from the bottom a year ago, but also down 25% from the peak (had to sneak good and bad for that last big dip)
Okay here is my spin! STOP comparing everything from the PEAK! It was inflated it was not supposed to happen and if this is the standard by which we measure ,well we are always going to come up short! Good golly if I only look at the months that I had a lot of Real Estate sales close and only compare my self to the peak of earnings I would be terrified of loosing everything I own. No instead my family planned for the future I knew this was not a normal Real Estate Market. I had only been in business 2 years when the boom came and I even knew the market would stop at some point. We built our life around normal income not the inflated market. We did not over spend and create a household budget on what was coming in. To be honest, and Ill put it out to the world. I live on 3500k a month after taxes. YES that is it. We have all the normal bills as everyone else including HIGH Health insurance cost. I’m tired of analyst comparing everything we have to the PEAK. Id love to see if the peak never happened how far off would be be. Id also love to see American’s budget for what they actually earn and not an inflated income.
After watching Back To The Future, CNBC’s so-called debate moments ago (Friday, January 29th, 2010), I have no doubts any more that CNBC is no longer a credible financial news bureau but a full-fledged media entertainment company.
Make no mistake, this was no debate. This was a “show”. This was a slick, highly polished, “sound and graphics” show. Guess who hosted this primetime-style game show? One of CNBC’s own sycophant personalities, the serious-sounding pseudo-journalist, Maria Bartiromo, of course. Think I’m joking? Take a look for yourself when the clips of it hit YouTube. [Sorry. I'll embed them later but I'm not wasting any more of Friday night on this piece of &#%@]
If you have half a brain, and have been paying attention to what has been happening since the economy took a nose dive right before President Bush left office, then you’ll immediately see right through this primetime charade. This was a blatant attempt by those high-risk big business interests who were responsible for the crash to manipulate public opinion and put pressure on Washington. They want to keep government from doing its job, which is to impose proper regulation on the financial markets.
This “hidden agenda” was so obvious, you would have had to have been blind not to see it. I mean, the “audience voting and polling” part at the end of the show was classic, as if CNBC, you’re MTV’s America’s Best Dance Crew. Come on! This thing was so rigged, I didn’t know if I should laugh at how sad it was, or be mad because you think I’m that stupid. Really CNBC? Hell, bitches,y ou should have had Fanny Pak out there busting out hot routine for the Swiss. At least that would have made it entertaining.
Listen y’all. This last Wall Street “crash and burn” which required Washington to step in and bail these morons out was caused by an under-regulated severely over-leveraged credit markets – just like all the crashes before – because these financial geniuses took on more risk than they should have. So when the going got choppy, these dip-shits lost their asses. But the stupid part is, they don’t want government regulation imposed to prevent them from doing it again. Of course, they want to do it again, and wouldn’t you if you were them? Think about it. During the bubble market, you make bag loads of dough. After it the bubble pops, the taxpayers throw bags of dough at you and rescue your ass. Nice work if you can get it.
Well, it’s up to you. If you want to buy this crap that these greedy whores are trying to sell you, then go right ahead because you’re a bigger fool than they are. And start chanting, DOWN WITH SOCIALISM… as if you can even properly define socialism.
♦ ♦ ♦
URI REFERNCES
CNBC.com: Back To The Future from Davos: http://bx.businessweek.com/davos-world-economic-forum/view?url=http://c.moreover.com/click/here.pl%3Fr2479783886%26f%3D9791
Berni Moestafa — Indonesia, Asia’s second-best performing stock market last year, may be ready to join the so- called BRIC group of major emerging nations, according to Templeton Asset Management Ltd.
“Indonesia’s political and economic outlook has improved tremendously in recent years,” Templeton portfolio manager Dennis Lim wrote in a note yesterday on Chairman Mark Mobius’s blog. “So clearly, it would not look out of place beside the BRIC countries.”
Inclusion in the category — Brazil, Russia, India and China — coined in 2001 by Goldman Sachs Group Inc. Chief Economist Jim O’Neill may increase demand for Indonesian stocks. Investors should “stick with the BRICs,” a group that “tends to outperform in non-recession years,” Morgan Stanley strategists led by Jonathan Garner said last week.
The Jakarta Composite index jumped 87 percent last year as Indonesia skirted the global recession after nine interest rate cuts by the central bank. President Susilo Bambang Yudhoyono’s re-election in July boosted confidence he will maintain policies that helped Southeast Asia’s biggest economy expand more than 6 percent annually in the two years until 2008.
Economic growth may average 6.6 percent over the next five years as poverty and unemployment decline, Yudhoyono said on Jan. 4. Fitch Ratings on Jan. 25 raised Indonesia’s credit ratings to one level below investment grade.
Fitch’s Upgrade
Fitch’s rating upgrade reflects Indonesia’s economic resilience and an improving balance of payments, said Bank Indonesia Deputy Governor Hartadi Sarwono. Foreign-exchange reserves rose to $69 billion as of Jan. 22, he said.
“Being in the same group as BRIC may get Indonesia more attention from investors,” said Finny Fauzana, a fund manager at PT PNM Investment Management, which oversees about $139 million in assets in Jakarta. “But foreign investors putting money into the real economy need more than that because they consider a lot of other factors such as regulation and taxes.”
Indonesia ranks 122 out of 183 economies in a World Bank 2009 survey on business-friendly practices. President Yudhoyono said on Oct. 20 he would reduce bureaucratic “bottlenecks” that hinder investment. He campaigned for re-election in July on a pledge to double spending on roads, rails and ports to $140 billion over the next five years to boost economic expansion.
Faster Growth
Growth may accelerate to 7 percent from 2011, providing the case for Indonesia’s inclusion into BRIC, according to a Morgan Stanley report in June. Emil Salim, a former cabinet minister, said in July that Indonesia’s targeting to “put another ‘I’ into BRIC,” adding the goal may be achieved in five years.
“The BRICs theme, which played well in 2009, continues to resonate in early 2010,” Cambridge, Massachusetts-based funds tracker EPFR Global said Jan. 21. Dedicated BRIC equity funds recorded inflows of $182 million in the third week of January, compared with the $103 million average last year, EPFR said.
Overseas investors have bought a net 666 billion rupiah ($71 million) of the shares this year, according to exchange data. Overseas investors purchased 13.3 trillion rupiah of the shares last year, down from 18.7 trillion rupiah in 2008.
I absolutely hate BB&T. I transferred out all my money to close out the account tomorrow on my day off.
Guess what?!?! They charged me $2 for “The Plus Fee” THEN $7 for the overdraft protection fee! And considering it’s 12:41AM EST there is NO customer service!
Joe is ticked. Can’t even call Customer Service until 6AM! What a GREAT way to start the day!
Anything to screw you! I had to fight them with PAST print outs of my account to prove THEY deliberately held up 5 small payments for one BIG one. I proved they small ones should have gone through a WEEK before the big one. But they held it up to charge me $170 in overdraft fees!
Took me 2 weeks to get them to fix it, WITH them holding up my next deposit. I just got it cleared up, then transferred the money out this week and was going to go in tomorrow to close account.
But they got me. ONE DAY! What a bunch of blood suckers!
When things looked their darkest for Gov. Mark Sanford — when he was in danger of being impeached for running off to Argentina to see his mistress — his best insurance policy may well have been South Carolina’s lieutenant governor, Andre Bauer. Lawmakers knew if they removed Sanford, they would end up with Bauer, a fiercely ambitious Republican with a reputation for reckless and immature behavior.
Now Bauer has folks shaking their heads again, after he likened government assistance to the poor to feeding stray animals. At a town hall meeting Thursday, Bauer, who is running for governor in his own right now that Sanford is term-limited, said: “My grandmother was not a highly educated woman, but she told me as a small child to quit feeding stray animals. You know why? Because they breed! You’re facilitating the problem if you give an animal or a person ample food supply. They will reproduce, especially ones that don’t think too much further than that.”
Democrats and others railed at him. “I am disgusted by these comments. They show an unbelievable lack of compassion toward the unemployed workers in our state who are hurting during these hard times,” said state Sen. Vincent Sheheen, a Democrat who is also running for governor. “His comments were immoral and out of line.” South Carolina schools Superintendent Jim Rex, another Democratic candidate for governor, called Bauer’s comments “reprehensible” and said he should apologize – Read full article…
S.C. Republican: Welfare to the Poor Like Feeding Stray Animals
The economy is terrible and everyone knows it. People are losing their jobs left and right. Students don’t want to leave college for fear that there will be nothing waiting for them. And now a hurricane struck Haiti– what else could happen?
Q: When the world is looking for help, who do we turn to?
A: Apparently the king of Sean Jean, Ciroc vodka, and the hip hop world. None other than P. Diddy himself. Or Sean Combs. Or Puff Daddy. Or… never mind.
I found this video and at first I thought, “how sweet of him to help out the homeless.” The video is of Diddy leaving a club, buying roses for his entourage, and giving a homeless man $100. (I thought this was a nice tie in with “It’s all about the Benjamins” song we all know and love.) I digress.
And it is sweet. Celebrities giving away their money to the less fortunate is a great act of charity. It is selfless and genuine. Or is it?
What could be taken as a great gesture could also just be a PR ploy. He knows the cameras are there. He knows they are paparazzi and will soon post their video online if they aren’t already as they film it. So was he giving out of the goodness of his heart or out of the goodness of publicity?
I’m sure Diddy was just being a good citizen and trying to help someone out, but you cannot deny the great timing and the fact that it was on video for the world to see. If he really wants change in the world, give to an organization that makes great things happen for people everyday like The Salvation Army, United Way, or the Red Cross, to name a few. They will make sure that $100 doesn’t end up as a fifth of whiskey and a dime of marijuana. I can’t help but be biased about the homeless. They surround me everyday in Austin and ask for money only to get picked up later by their parents in a 7.45Li BMW. Yes, I have seen it happen.
Please, celebrities, can you all follow in the footsteps of your peers and give to organizations and nonprofits? Don’t give out cash in front of cameras to people who will most likely throw it down the drain along with their lives.
So if you’re ever in need of, say $100, who ya gonna call? Hopefully not P Diddy!
NEW YORK (AP) — Wal-Mart Stores Inc. said Sunday it is cutting about 11,200 jobs at its Sam’s Club warehouse division as it outsources in-store product sampling to marketing company Shopper Events in an effort to win more customers and boost lagging sales.
The terminations represent about 10 percent of the warehouse club operator’s 110,000 staffers across its 600 stores. About 10,000 members of the demonstration department, most part-time workers, were let go. The company also cut its new business membership representative positions, affecting about 2 staffers per store, or about 1,200 staffers in total.
For the last 5 years that we have been in business we have come to know several micro and small business owners. They like us have seen there business grow a little each year and orders were fairly steady. All that has changed in both 2009 and currently in 2010. Some of both the micro and small business have had to close there doors. This is going to hurt the economy even worse then it is now. If and when the economy recovers some of these business won’t be able to re-open there doors.
One business owner was barely hanging on and had a brick and mortar store but also had a website. What she decided to do was to close up her store and has since changed to selling strictly online. By doing this they don’t have the monthly rent, utilities and general overhead.
A consultant that I spoke with said that rather than having an outside office she decided to work in her home. The amount of money that she saved doing this helped her to be able to comfortably pay her mortgage each month.
Some small business owners have sat down with their employees in an open meeting with a brainstorming session. By talking to your employees and letting them know what is going on your employees may have creative ideas of their own that may really help.
One thing that has helped us quite a bit is to come up with ideas for other products. Our BZ Award and the Pennants that we will introduce soon will help in the long run, by expanding our product line into different areas. If you are running a business with a niche product like us now is the time to experiment with new ideas that enhance your business.
This is not the time to start second guessing your product and lowering the price to less than it is worth. What has changed is the economy not your product!
Several of the people that I have talked to have cut corners in there overall personal budget to help ease the strain. Eating out less and spending less on entertainment.
As the average American consumer goes to buy products, and more and more of both small and micro business are failing, the result will be that all of us will have less and less choice in what we can buy. Small business are hurting and there doesn’t seem to be a end in sight. As they fail and products get harder to find it will ultimately hurt everybody. Anything other than cheap cookie cutter products will be hard or impossible to find. Is this what we want?
By BOB HERBERT
Published: January 22, 2010
How loud do the alarms have to get? There is an economic emergency in the country with millions upon millions of Americans riddled with fear and anxiety as they struggle with long-term joblessness, home foreclosures, personal bankruptcies and dwindling opportunities for themselves and their children
The public interest? Forget about it.
With the power elite consumed with its incessant, discordant fiddling over health care, the economic plight of ordinary Americans, from the middle class to the very poor, got pathetically short shrift. And there is no evidence, even now, that leaders of either party fully grasp the depth of the crisis, which began long before the official start of the Great Recession in December 2007.
A new study from the Brookings Institution tells us that the largest and fastest-growing population of poor people in the U.S. is in the suburbs. You don’t hear about this from the politicians who are always so anxious to tell you, in between fund-raisers and photo-ops, what a great job they’re doing. From 2000 to 2008, the number of poor people in the U.S. grew by 5.2 million, reaching nearly 40 million. That represented an increase of 15.4 percent in the poor population, which was more than twice the increase in the population as a whole during that period.
The study does not include data from 2009, when so many millions of families were just hammered by the recession. So the reality is worse than the Brookings figures would indicate.
The Tacoma School District has just asked me for roughly 2% of my salary more so that they could teach my children.
This is a farce. They haven’t taught my kids. I teach my kids. They come home from school, do their silly homework assignments, and then they do the school work I assign them.
If our schools were actually teaching children, I don’t think I would have a problem parting with the money. But they aren’t. Our schools are failing. The entire system is failing. Students who need an education aren’t getting one, and students who would get educated anyway are doing worse than they would otherwise.
I don’t blame the teachers, administrators, school boards, parents, or legislators for these failures. I blame socialism—the system whereby our schools are administered. When you have people who can’t care decide how to spend money that isn’t theirs, you get bad results for a high price.
Put parents in charge of their own child’s education. Let them spend their own money on their own kids. Make them own their choice, and let them take responsibility if things go bad so they can set it right. No one can hope to care for any child as much as the child’s parent. If the parent doesn’t care, take the kid away and give the kid to someone who will care.
If they don’t have enough money, find innovative ways to increase the efficiency of the schools so that they can afford an education. We’ve fed the poor until they are fat by making food so cheap they can stuff their faces full and walk down the street with a girth that would make any English king cower. We can do the same with education and health care if we allow market forces to go to work for us instead of against us.
If they still don’t have enough money, and you feel sad about that, write a check for 2% of YOUR salary to your local school. Or 10%. Or 100%. It’s your money, spend it however you wish. I can’t stop you.
Don’t force me to write a check for something I am already providing for my children. Don’t double tax me to fund something that is broken.
Don’t make me pay so that you can feel good about yourself.
The 2010 Audi A3 TDI has been named Green Car Journal’s 2010 Green Car of the Year®.
The clean diesel from Audi rose to the top in a stellar field of hybrids and advanced diesel models that all offer exceptional fuel economy and low emissions. This marks the second year in a row that a clean diesel vehicle has taken the top prize.
The groundbreaking TDI®® 2.0 engine available in the A3 delivers 140 hp and 236 lb-ft of torque, yet achieves an EPA-estimated 42 mpg highway fuel economy that is the best of any luxury car sold in America. That means the Audi A3 TDI®® achieve 50% better fuel economy than a comparable gasoline engine.
The Green Car of the Year® jury, comprised of six environmental and automotive experts along with Green Car Journal editors, selected the 2010 Audi A3 TDI from a field of five finalists that also included the Honda Insight, Mercury Milan Hybrid, Toyota Prius and VW Golf TDI.
TransDomo,LLC
Klaus Westerwelle
8 Briarpark Drive
Greer, SC 29651
Phone: 864.908.0690
Email: info@transdomo.com
International Business Consulting: Transdomo
International Real Estate / Immobilien : Westerwelle
The global economy is poised to grow 2.7 percent this year, but the recovery will be slow as the impact of fiscal stimulus wanes, the World Bank has said in a report.
The Global Economic Prospects 2010 report released Wednesday said the recovery “that is now underway will slow later this year as the impact of fiscal stimulus wanes.”
It said the global economy shrunk 2.2 percent in 2009.
Financial markets remain troubled and private sector demand lags amid high unemployment. However, the economy is expected to grow 3.2 percent in 2011, Xinhua reported.
“Overall, these are challenging times,” said Justin Lin, World Bank chief economist and senior vice president.
“The depth of the recession means that even though growth has returned, countries and individuals will continue to feel the pain of the crisis for years to come,” he said.
The report warns that while the worst of the financial crisis may be over, the global recovery is fragile. It predicts that the fallout from the crisis will change the landscape for finance and growth over the next 10 years.
Gross domestic product (GDP) — the wide measure of overall economy — for developing countries are for a relatively robust recovery, growing 5.2 percent this year and 5.8 percent in 2011 — up from 1.2 percent in 2009.
The World Bank predicts China’s economy to grow by nine percent in 2010 and 2011.
Prospects in rich countries, which declined by 3.3 percent in 2009, is expected to increase much less quickly — by 1.8 and 2.3 percent in 2010 and 2011.
The US, world’s biggest economy and the epicentre of the financial crisis that triggered the downturn, would see 2.5 percent growth in 2010 and 2.7 percent in 2011. The World Bank projected the US economy to shrink 2.5 in 2009.
World trade volumes, which fell by a staggering 14.4 percent in 2009, are projected to expand by 4.3 and 6.2 percent this year and in 2011, said the World Bank.
While this is the most likely scenario, considerable uncertainty continues to cloud the outlook. Depending on consumer and business confidence in the next few quarters and the timing of fiscal and monetary stimulus withdrawal, growth in 2011 could be as low as 2.5 percent and as high as 3.4 percent.
“Unfortunately, we cannot expect an overnight recovery from this deep and painful crisis, because it will take many years for economies and jobs to be rebuilt. The toll on the poor will be very real,” said Lin, the World Bank’s chief economist.
“The poorest countries, those that rely on grants or subsidised lending, may require an additional $35-50 billion in funding just to sustain pre-crisis social programmes,” he said.
Just a quick post this morning while I enjoy a nice warm cup of joe. I want to point everyone to my new social vibe widget, I felt the need to change it yesterday as images of Haiti filled my TV screen, mind, and heart. I don’t think any one of us can understand the amount of destruction that has happened to that wonderful, beautiful place and even with a mom like I have and the emotional and physical abuse I had to endure because of that, I can’t understand the destruction of the lives of the people that call Haiti their homeland, their soil, their heart and souls. Think of your favorite city and imagine walking through it with 50,000 dead people lying in the streets. I think anyone of us would call a place like that uninhabitable; terror and horror would fill our minds and hearts.
So I went searching for a new Social Vibe widget and found one that will donate trees to Haiti, which isn’t anything that they need right now but hopefully someday, they will need it. So please have fun with it!
Wonder what you would find if you frisked the Michigan-based company Trijicon?
Answer: They put coded references to New Testament Bible passages on some of their high-powered rifle sights.
And of course ABC News blows this story way out of proportion… Starting with the headline U.S. Military Weapons Inscribed With Secret ‘Jesus’ Bible Codes:
Coded references to New Testament Bible passages about Jesus Christ are inscribed on high-powered rifle sights provided to the United States military by a Michigan company, an ABC News investigation has found.
The sights are used by U.S. troops in Iraq and Afghanistan and in the training of Iraqi and Afghan soldiers. The maker of the sights, Trijicon, has a $660 million multi-year contract to provide up to 800,000 sights to the Marine Corps, and additional contracts to provide sights to the U.S. Army.
U.S. military rules specifically prohibit the proselytizing of any religion in Iraq or Afghanistan and were drawn up in order to prevent criticism that the U.S. was embarked on a religious “Crusade” in its war against al Qaeda and Iraqi insurgents.
One of the citations on the gun sights, 2COR4:6, is an apparent reference to Second Corinthians 4:6 of the New Testament, which reads: “For God, who commanded the light to shine out of darkness, hath shined in our hearts, to give the light of the knowledge of the glory of God in the face of Jesus Christ.”
[...]
Trijicon confirmed to ABCNews.com that it adds the biblical codes to the sights sold to the U.S. military. Tom Munson, director of sales and marketing for Trijicon, which is based in Wixom, Michigan, said the inscriptions “have always been there” and said there was nothing wrong or illegal with adding them. Munson said the issue was being raised by a group that is “not Christian.” The company has said the practice began under its founder, Glyn Bindon, a devout Christian from South Africa who was killed in a 2003 plane crash.
Hmm… I don’t know about you, but I don’t consider a scope a weapon. You absolutely have to take things like this with a grain of salt, because liberals have an extreme desire to remove all mentions of anything related to God or religion. Once again, political correctness at its finest.
Side-Note: What is the big deal with taking a Bible verse referring to light on a scope that probably uses ambient light to produce its aiming point?
The new Working Lands Initiative in Wisconsin seeks to either a) preserve farmland for farming operations or b) prevent developers from building shopping malls and subdivisions. It depends upon your point of view.
In southern Wisconsin, farmers are selling land to commercial developers. This places two problems on the remaining farmers: 1. housing construction creates neighbors that don’t want farming smells and noises, and 2. the land that once grew hay to feed the animals is gone and farmers have to pay more to bring feed to their animals. This has a major impact on dairy-farming.
The legislative solution in Wisconsin was to create the Working Lands Initiative (WLI) to preserve farmland throughout the state. This initiative gives power to the county to create agricultural preservation plans that prevent land owners from selling out to developers. In exchange, the farmers obtain preferred income tax credits.
It’s a little complex but the county can declare certain areas to be preserved for farming. In these areas, the land is loaded up with regulations that restrict how the land cannot be used for non-farming purposes. In essence, once declared a farmland preservation area , the farm, and thus the farmer, can and/or cannot do the following:
1. Can sell the land to other farmers for farming operations
2. Can change the zoning and sell the land to developers by paying a conversion fee of 3x the amount the land is worth as agricultural land. ( Yup, three times the value of the land itself! Extortion by another name!)
3. Can without re-zoning, sell off enough land to build 4 houses… but only if the total amount of land sold is no more than 5% of the size of the original farm. Oh, and by the way, the other 95% of the land can never have another residence built upon it unless the zoning is changed and the conversion fee is paid.
4. You cannot do any of this if your land is considered prime farming land OR if the selling of your farmland would impact your neighbors ability to farm his own land. Example, you wish to sell four lots of ten acres each that abuts your neighbors property. If your land is prime farming land, too bad so sad. You are prohibited from selling your land for this purpose. Another example, your neighbor is engaged in a farming operation that is not permitted within X feet of residential property. If you sell your lots, your neighbor can no longer farm as he once did. The farming operation may be related to noise, ground water, or smells that are not permitted in residential areas by law. Too bad, you cannot sell your land if your neighbor’s farm is impacted.
I predict that this WLI will cause the following effects if unchanged:
1. Large animal operations will seek to prevent development in their surrounding areas.
2. Ten- to forty-acre parcels will no longer be carved out for private purchase and sold by local farmers when money is needed.
3. The number of possible farm buyers will dwindle to only rich farmers. Developers and private purchasers will not want those restrictions placed on the use of the land they buy. This will lead to fewer farm owners within 20 years. Possibly only giant farming corporations will remain in another 25 years.
4. Local communities will not have the option of development to expand their communities. Property tax revenues will come mainly from the corporate farms and not citizens. This places the corporate farms in the same position as the mining towns out west …with expanded power over the local community. A Farm Town may have a whole new meaning in the future.
I don’t like this Working Land Initiative as it appears aimed at destroying the family farm of a couple of hundred acres and replacing it with mega-farms protected by law.
The third quarter of a financial year is always a mixed bag for the domestic corporate sector. While companies in sectors like auto, FMCG or
consumer durables manage to post good numbers during this period because of the festival season, other sectors like technology face volume dips due to the lesser number of working days. Signs of recovery are getting more visible, the sector is yet to get back to the hay days of boom time where both the topline and bottomline grew at a rapid pace.
With US companies too going slow on technology spending, investors are beginning to focus on companies which have a good share of the domestic market. In the case of large-sized tech companies, those who have the wherewithal to compete well on the price front are the preferred lot.
As we come to the crucial junction in the financial year, the results of the previous quarter assume significance. While it is given that companies focused on domestic business would do well, much of the good show is attributed to the stimulus packages which resulted in easy money.
The trend on the liquidity front is expected to change as the Reserve Bank of India (RBI) may tighten its stance marginally. Many analysts are taking comfort in the fact that the case for easy money policy withdrawal is also due to the demand for credit. The real impact of any marginal increase in interest rates would be felt a couple of quarters down the line though the government has already been gung-ho about the growth rates. Not many are disputing the eight per cent growth rate projection for the economy as a whole.
The next few days will throw more light on the future trend when more companies would have presented their quarterly results.
More than half of Hamid Karzai’s new nominees for cabinet posts have been rejected by the Afghan parliament. In this new vote, 10 of 17 new nominees were rejected (photo, from bbc.co.uk). This vote came two weeks after MPs turned down most of Karzai’s first choices.
Among the approved nominees were key posts : Karzai’s former security adviser Zalmay Rasul as foreign minister and Habibullah Ghalib as justice minister.
Amina Afzali is the only woman, out of three nominated, who has been backed by MPs, as work and social affairs minister.
The two women who were rejected were put forward for the posts of public health and women’s affairs.
According to BBC’s Mark Dummett, in Kabul, president Karzai had hoped to have his new cabinet in place before a crucial donor conference in London on 28 January, but that now appears impossible.
Despite the setback, the Afghan president now has 14 of 24 ministers confirmed, among which are the most powerful ones in charge of foreign, defence and interior ministries.
When the president will propose names in order to fill the vacant positions and when Parliament will vote for these new candidates remains unclear.
In reaction to the first vote on 2 January, president Karzai ordered MPs to cancel their winter break in order to speed up progress towards getting a functioning government in place.
International pressure
The rejection of 17 of Mr Karzai’s 24 original choices was seen as a blow to his authority, which was already damaged after an election marred by fraud in August.
None of the previously rejected nominees were on the new list.
For the last week, MPs questioned the new candidates ahead of Saturday’s vote, which was carried out by secret ballot.
Some MPs had complained that candidates were not suitably qualified or that others were too closely aligned to warlords.
The re-elected president faces strong international pressure to create a government that can oversee reforms.
International funding for Afghanistan’s parliamentary elections this year will depend on reform of the country’s election institutions, said the UN.
From the Center for Freedom and Prosperity comes a refresher course in Economics 101. The video is masterful, so I’ll let you watch and then comment:
I bring this up mostly because the DNC talking point of choice recently wormed its way into the Coakley-Brown debates. Still genuinely unaware of the fact that the internet exists and that people can find out for themselves how we came to be in this mess, Democrats continue to press forward with the audacious contention that some great Republican trifecta of greed, deregulation, and tax cuts have brought us to the brink of economic ruins. Here’s Coakley handing out her version, along with the now-cursory attempt to tie the Republican to the spooooky Bush-Cheney duo:
As the candidates fought over taxes, Coakley turned aggressive, suggesting that Brown was promoting a return to the era of George W. Bush, which she said favored the rich and triggered the economic collapse.
“He wants to go back to those Bush-Cheney policies that provide for the very wealthiest,’’ she said.
“You can run against Bush-Cheney, but I’m Scott Brown,’’ Brown responded. “I live in Wrentham. I drive a truck.’’
Brown’s answer was sufficient, given that most debates–and indeed, even most columns and blog posts–don’t allow enough time to detect and overthrow the popular MSM-backed theory of deregulation, greed, and tax cuts, let alone the time to explain the real reason for the “Great Recession”. This video is one of the best summations of the underlying reason for our current economic situation, as well as a fairly succinct argument against government interference in the insurance business. It’s about risk–something Democrats surreptitiously claim they can remove from life without also removing individual liberty.
In a previous article, I said that due to certain restrictions, it is difficult for a political leader in the Philippines to institute or implement genuine ‘course changing’ measures that would bring the country out of its economic doldrums. That’s probably easy enough to say.
The real challenge of course is identifying what those measures should be. In other words, if you are willing to accept that radical reforms make up the recipe for economic recovery, you must also be ready to justify it and THAT presupposes that you have an idea of the ingredients yourself.
We will reserve that topic for later. What seems obvious however is that whatever that menu of solutions may be, it will not work if its not a comprehensive program that will benefit everybody, especially the poor.
A report published by the ADB in 2009 (using circa 2006 statistics from the Philippine government) suggests that while the country has experienced “modest growth” through the recent years, the level of inequality, measured through the Gini coefficient, has hardly changed. In fact, Bert Hofman, the World Bank Country Director for the Philippines believes that the level of inequality has actually increased. This means the gains of the recent moderate boom cycles have only benefited that sector of Philippine society which already earns high income.
At the end of the day, people will not sign on to any plan to overhaul the economy if they don’t see more food coming to their table or if the food is not coming soon enough. This is significant because that plan may ultimately involve reforms that are designed to increase country competitiveness by liberalizing trade laws or lowering the cost of Filipino labor.
Right now for instance, if the country wants to take advantage of the expected decrease in Chinese productivity (due to rising labor costs in that country), it has to compete with countries like Thailand whose minimum wage is four (4) times LESS than the floor set in the Philippines. At current levels, even China’s minimum wage values are only half those of the Philippines.
These solutions do make a lot of sense on paper but to actually execute them calls for a large measure of political will and the ability to deliver results fast. In the one example that we cited, it is probably simple enough to say that economic development comes at a cost. However, it’s a rather different proposition to explain that the cost will first have to be borne by the poor.
This new piece of analysis from NIESR (UK) makes the point based on prior recessions, that 20 – 30 months are left, at a minimum, before we get close to where GDP was before this recession period began. This point gets lots when the only measurement that media speak of is the last quarters +/-. What matters is where we are relative to where we began, and there a long way to go.
http://www.niesr.ac.uk/
Our monthly estimates of GDP suggest that output grew by 0.3 per cent in the three months ending in December, following on from a growth of 0.2 per cent in the three months ending in November. These data show that GDP fell by 4.8 per cent in 2009. This is a bigger fall than in any year of the great depression and is Britain’s biggest contraction since 1921. As the graph below shows, the broader picture of the depression is that output fell sharply for twelve months until March and has not changed very much since then, although evidence of a recovery is starting to emerge.
Figure 1: The Profile of the Depression: Months from the Start of the Depression
Calculated from three-month moving averages of monthly GDP
For you suppliers out there, you want to know how to win business in the recovering economy? Good, then follow these three pieces of advice:
Ensure you understand what the buyer is looking for – ask clarification questions, read competitive documents carefully, review the evaluation criteria – this will give you insight into how the decision will be made. Don’t just focus on the requirements as there are other areas of a competitive document that give clues as to what the buyer wants.
Provide a high quality response – you may not win the first competition you enter, but if you submit a quality proposal, the buyer will remember some elements of your proposal that will put you in better stead for next time. A client of mine chose someone else for the initial strategy work they needed, but liked the strength of my implementation recommendations in my proposal so awarded me the implementation piece which was much more lucrative and long-term.
Use your debrief sessions – always request for a debrief session when you do not win the business. This will help you gain insight as to what areas of your proposal need to be strengthened and gives you an opportunity to strengthen your relationship with the buying organization.
Amid stagnant unemployment and a sluggish economic recovery, the White House is reverting to a simpler and arguably more misleading way to count job creation related to the stimulus package.
In a little-noticed memo published last month the Office of Management and Budget announced that it would no longer keep count of jobs created and saved by stimulus projects, but would keep a running tally of all people who work on the projects, even if they were not in danger of losing their job.
The memo, which was first written about by ProPublica, was circulated to federal agencies by OMB head Peter Orzag.
OMB says it made the change to prevent the errors seen in previous job counts, but Republicans say the White House is trying to boost poor job numbers anyway it can.
One example of how the new method would change numbers is Chrysler. According to ProPublica, the company originally reported zero jobs for a government contract of 3,000 vehicles because those positions were filled from existing employees. Under the new system, those jobs would count. -CPP
With the poor economy continuing to affect TV advertising revenue, you see more and more direct marketing commercials selling items that are “not available in stores.” These ads typically feature extremely agitated pitchmen, a toll-free order number, a price that’s typically $19.95, and tiny-font shipping and handling charges that run you another $12. If you order now you can get two, and don’t forget that these items are not available in stores, probably because the idea behind stores is that they offer products people actually want.
It used to be that you only saw these commercials late at night, when you were so worried about how you’d deal with sudden urges to fish that you couldn’t sleep. And mercifully, there would be an ad for the “pocket fisherman.” Now you’re likely to see these kinds of spots any time of the day or night. An NPR report recently explained the trend: as traditional advertisers reduce their budgets, local stations make leftover air time available to these low-end buyers at drastically reduced rates. One ad buyer interviewed admitted he was a “bottom feeder,” which I think would be an excellent name for a product: Try the BottomFeeder! You’ll never need to buy bathroom tissue again!
A lot of the trailblazers in this industry have unfortunately been made archaic by modern technology. The Ginsu Knives, famous for cutting through a can, were so sharp and awkward to use that most of their purchasers accidentally slashed their wrists. The Medic Alert bracelet, for when you’ve fallen and can’t (or simply don’t want to) get up, was antiquated by the cell phone. The Clapper, which allowed you to turn stuff on from across the room, was discontinued when seniors began using the Segway to travel effortlessly about their homes from light switch to light switch.
One of the promoters currently most in demand for these frenetic spiels is a bearded, raspy-voiced fellow named Billy Mays. Son of baseball’s Willie Mays, who roamed centerfield for the San Francisco Giants for over two decades on his way to 12 Golden Gloves and the Hall of Fame, Billy wanted to get out from the shadow of his famous father. His big break came in the ‘90s when he was selected to be spokesman for the Bedazzler, a tool that embedded plastic gems into jackets, jeans and that household pet desperately in need of a makeover. He later sold items like OxiClean, the Mantis Tiller and Miracle Whip (I can’t remember ever seeing him hawk the well-known mayonnaise substitute, so I can only guess this product was instead some kind of domination device).
Described by The Washington Post as having a “signature yelling approach” and being “known for screaming in lieu of talking during infomercials … a full-volume pitchman, amped up like a candidate for a tranquilizer-gun takedown,” Mays was last seen branching out into the service economy. He was recently named the new voice of iCan Benefit Group, “the first company offering health insurance Billy Mays has been excited to endorse.” (He’s endorsed many other insurance plans, but steadfastly refused to be excited by them until now.) I anticipate a not-too-distant future in which Billy sells everything from mutual funds to cremation services in his classic manic shriek.
Mays is not affiliated with the infomercial product that most recently has been all over the airwaves — I mentioned him mainly because I wanted to see how many readers would buy the Willie Mays connection. I’m talking here about the “Loud and Clear” sound-amplifying device that fits in your ear like a Blutooth cell phone apparatus. No longer will your difficulties interpreting sound be obvious to all who can see the electroacoustic device in your ear; now, they’ll think you’re just another self-absorbed tool enamored with pointless technology that hangs off the side of your head. I can hardly wait for the next-gen app that enhances your smelling abilities with the brushed-steel device that protrudes from your nose.
Rather than using a spokesperson, the Loud and Clear commercials feature actors pretending to go through their daily routines enjoying the life-enhancing properties of a monstrous hearing aid. There’s a guy in bed next to his annoyed wife, who’s giving him dirty looks because the TV is too loud for her to sleep, until he discovers the Loud and Clear and can turn that damn thing down. There’s a woman rocking out to the kitchen radio while her husband tries but fails to concentrate on his laptop work. Rather than asking him to get his stupid computer off the kitchen table, she’s seen moments later happily accessorized in her Loud and Clear. Others are involved in a number of activities designed to demonstrate that today’s seniors aren’t your father’s old people – they’re energetically playing bingo, strolling through the woods in tight jeans, and listening in on two neighbors having a private discussion across the street.
This last example hints at the more malicious uses of the Loud and Clear, which are also illustrated in the commercial with a surprising lack of guilt. One scene shows a guy, hopefully a private detective, sitting at the wheel of his parked car with the amplifier in his ear and a camera in his hands. He becomes suddenly attentive, clicks the camera at some off-screen scene, then nods in quiet satisfaction at how easily he was able to get naked pictures of his kid’s hot teacher. I’m not sure how the hearing device helped with this, unless maybe it keeps him on guard for the piercing sirens of approaching squad cars.
Generally, though, the Loud and Clear is shown engaging in harmless fun. There’s a party scene where a trio of attractive women are chatting, then the shot widens to show the eavesdropping stud who’s delighted to learn they’re talking about him. There’s a hunter in the woods — hopefully not the same woods with the tight-jeaned woman — using the hearing enhancer to listen for the rustle of live game. I only hope the L&C has a volume control handy, because when he lets loose with that shotgun, he’s going to get way more amplification than he bargained for. There’s a quiet conversation at home with the family, above a caption that reads “HEAR PEOPLE AROUND YOU!”
Probably the worst, most devious thing about this product is that I want one. I can tell that my hearing has declined in recent years, and I recognize that it would be nice to watch television and have some idea of why Howie Mandell is beating that guy over the head with a baseball bat. My world could be so much richer.
Actually, I think I’d like to have two, one protruding out of each ear. Maybe if I order now…
How savvy senior House Democrats are? Today’s news is, senior House Democrats, including House Speaker Nancy Pelosi, are asking to revoke the insurance industry’s exemption from the federal antitrust laws in the House-senate compromise bill. House Democrats also demand to include a “Nationwide Insurance Exchange” in the final bill, which is regulated by the federal government so that consumers can shop for private coverage. This combination of two mHow savvy senior House Democrats are? Today’s news is, senior House Democrats, including House Speaker Nancy Pelosi, are asking to revoke the insurance industry’s exemption from the federal antitrust laws in the House-senate compromise bill. House Democrats also demand to include a “Nationwide Insurance Exchange” in the final bill, which is regulated by the federal government so that consumers can shop for private coverage. This combination of two measures will surely beat oligopolistic competition or monopoly in US insurance market and introduce competition, although the effectiveness of these two measures in reducing health care costs and decreasing insurance premium would be probably less than those that can be achieved by “Public Plan Option.” If the current endlessly-arm-twisting political games had indicated that “Public Plan” is not a viable option under the current chronic spell of strong special interest politics, at least including these combined measures of stripping the insurance industry of exemption from antitrust laws and “Federally-regulated Nationwide Insurance Exchange” will eliminate oligopoly (competition among a few big companies) or monopoly (market domination by one big company without competition) structure of the insurance industry, break down insurance giants into smaller-scale-companies and strengthen the intensity of competition among smaller insurance companies. If “Public Plan” is facing insurmountable barrier to be a part of insurance reform due to industry interests, this second measure may be a viable alternative to achieve desirable market competition. http://news.yahoo.com/s/ap/20100109/ap_on_bi_ge/us_health_care_overhaul easures will surely beat oligopolistic competition or monopoly in US insurance market and introduce competition, although the effectiveness of these two measures in reducing health care costs and decreasing insurance premium would be probably less than those that can be achieved by “Public Plan Option.” If the current endlessly-arm-twisting political games had indicated that “Public Plan” is not a viable option under the current chronic spell of strong special interest politics, at least including these combined measures of stripping the insurance industry of exemption from antitrust laws and “Federally-regulated Nationwide Insurance Exchange” will eliminate oligopoly (competition among a few big companies) or monopoly (market domination by one big company without competition) structure of the insurance industry, break down insurance giants into smaller-scale-companies and strengthen the intensity of competition among smaller insurance companies. If “Public Plan” is facing insurmountable barrier to be a part of insurance reform due to industry interests, this second measure may be a viable alternative to achieve desirable market competition. http://news.yahoo.com/s/ap/20100109/ap_on_bi_ge/us_health_care_overhaul
Chris Lester, Senior Vice President/Business Growth
A generally disappointing year-end jobs report did offer a tiny bit of good news – revisions to the November numbers revealed that the economy actually managed to eke out a 4,000-job gain.
Consider it a footnote to economic history.
http://www.bls.gov/news.release/empsit.nr0.htm
The small November gain broke a 22-month streak of nationwide payroll job loss stretching back to the beginning of the Great Recession in December 2007. Here’s the toll of roughly 7.2 million jobs lost nationwide over that period of time.
The November revision did little to brighten an otherwise gloomy jobs report. The prelimary estimate is that employers once again shed 85,000 jobs in December. The nationwide unemployment rate, meanwhile, remained stubbornly stuck at 10 percent.
Moreover, the headline unemployment rate would have been worse if hundreds of thousands of frustrated job seekers hadn’t dropped out of the official work force.
Closer to home, things are a little better.
Fresh metro-level numbers released this week showed that unemployment in the Kansas City region was 8.3 percent in November, down slightly from 8.4 percent the previous month. The metro area lost about 22,200 jobs over the 12 months ending in November.
http://www.bls.gov/news.release/metro.htm
Combined, the labor market reports this week suggest that while the worst of the Great Recession is over, and in fact is likely over from a technical production standpoint, employers remain very uncertain about adding new workers. And job creation is the key to a sustainable recovery.
More on that next week when we discuss the results of our year-end Regional Business Survey.
UPS Inc will cut 1,800 management and administrative jobs, less than 1 percent of its global work force, and raised its earnings guidance for the fourth quarter by 13 percent to 20 percent.
About 1,100 employees will be offered a voluntary separation package as part of the work force reduction, which is designed to streamline the company’s U.S. small package business. Other cuts will come through attrition and layoffs, the Atlanta-based company said. SOURCE
1800 more jobs to go along with the millions already lost that Obama has not saved as he said he did! The American workers are hurting and Obama and the democrats are still spending which will raise taxes on companies and all Americans. If you ever had to live on an unemployment checks you know that a family can not make it with the prices of food and products going up. A worker that earn $8.00 and hour gets about and I mean about $200.00 a week….tell me how many people with a family can live off that! Then when you go into the employment office they treat you like you’re nothing. My son was just layoff and he got home he said that he was made to feel the lowest and that they act as if its their money you’re getting. I know as I have been there once in my life and its no fun. Obama and the democrats does not seem to get it! Lower taxes and forget this big health care spending bill or lose your seat!
We’ve just been through a year of enormous economic turbulence, and yet in most ways 2009 was mercifully quiet. The financial crisis hit the previous September and most things that could have gone wrong didn’t, allowing the world to focus on the digging out. 2009 saw no big geopolitical crises, no tussles with North Korea or Iran. The war on drugs in Mexico didn’t spill across the American border in a big way. Iraq didn’t blow up. There were no massive terrorist attacks (though Christmas saw a close call in the United States). No killer hurricanes, no huge earthquakes, and the H1N1 virus didn’t prove that threatening a pandemic after all. Governments around the world focused overwhelmingly on the domestic, putting tough policy decisions on hold. (And when they didn’t, as with U.S. President Barack Obama’s Afghanistan and health-care plans, the results were seriously watered down, and actual policy risk was limited.)
This year, that’s going to be much harder to accomplish. If the 2009 top risks were first and foremost about developed states having their wits sufficiently about them to get through the financial crisis (with the U.S. Congress leading the pack), as the world now emerges from recession the risks begin to shift to the challenges created by the emergence of a new global order — developed vs. developing states, the old unipolar system vs. the emerging non-polar one, and the old dominant globalized system of regulated free-market capitalism vs. the growing strength of state capitalism.
The biggest risk for 2010 comes from the point at which these three trends converge: U.S.-China relations. Simply put, 10 (percent unemployment in the United States) plus 10 (percent growth in China) does not equal 20. There’s been an enormous effort by the leadership of both governments to keep a functional U.S.-Chinese relationship in place, much like the international approach to the G20, so that everyone could see the seriousness of the enterprise. But with the world’s principal actors under less immediate strain, there’s less pressure to keep up appearances. This year, the gloves start coming off.
Next up is Iran, where a deteriorating domestic and international environment combined with toughening sanctions pressure will create greater incentives for Tehran to provoke conflict. Along with the continuing (though limited) risk of Israeli military strikes on Iran’s nuclear sites, this is the year to watch for serious trouble emanating from the Islamic Republic.
We’ll also still see significant concerns within developed states this year — weaker states in Europe under massive fiscal pressure; financial regulatory reform in the United States; and the impact of a political revolution in Japan. A few surprises from emerging markets — Brazil’s a risk this year, as coming elections are more troubled than people expect. India-Pakistan risk resurfaces after years of quiet engagement (while Afghanistan, making headlines throughout the year, is effectively pushed as a top risk to 2011 by the U.S. troop surge). Unemployment coupled with a spate of elections merit a spot for Eastern Europe in the top 10. And a host of domestic and international stresses puts Turkey on the list, too, though barely.
Terrorism doesn’t make the list. It’s a growing global concern, but as a specific risk, it’s a fat tail. It can really upset markets when an attack hits, but short of that it’s principally a growing drag on global growth. Yemen is emerging as a focus for al-Qaida, and no doubt we’ll see significant fighting there — with direct American engagement. But short of Yemen actually failing as a state (unlikely in the nearest term) it won’t have significant impact globally–or even on neighboring Saudi Arabia. After many years, climate change finally sees its place on the top 10 list, mostly because of the growing policy and market impacts of the continued absence of effective international coordination on responses, a trend we’ll see more often in our increasingly non-polar world.
There are all sorts of country risks that don’t quite make the list–Colombia, Dubai, Malaysia, Mexico, Nigeria and Thailand to name a few. Each is worthy of concern for those with direct exposures in these economies, but none will grow to the level of global risk in 2010.
And then some interesting red herrings. These include U.S. and British financial centers, the death of which has been greatly exaggerated; Iraq, where investment and new oil will be a much bigger story than security risks; the Persian Gulf, which we generally like quite a bit (Dubai’s problems notwithstanding); and the dollar, where really slow and steady-ish still wins the race.
1. U.S.-China Relations
The G2 was a stillborn idea, because Beijing doesn’t want the responsibilities, even though the United States pushed hard for this framework at the Obama-Hu Jintao summit in November. That won’t last in 2010. In the future, we’ll look back at that summit as the peak of the relationship, and we’ll see significant deterioration in U.S.-Chinese relations in the coming year.
The problem isn’t Obama or Hu; both want to avoid ruffling feathers. But there are too many structural pressures for it to last. The United States is looking for more (and more responsible) international leadership from the Chinese — stakeholdership continues to be the mantra in policy circles. But as clearly evidenced on climate change during the Copenhagen summit, the Chinese have little national interest in taking a lead role. In 2010, we’ll see this trend also play out on nuclear proliferation; reform of rules of the road for international trade and commerce; cyber-security; and security in Afghanistan, Iraq and beyond.
For Beijing, economic partnership with the United States looks a lot less attractive than it did just a couple of years ago. But China’s top leadership recognizes that it has little choice for the near term, which is why they are taking their time in building domestic demand and instead doing everything possible to maintain its share of global export markets. That means continuing domestic stimulus for the economy and tight controls over the exchange rate of the yuan. It also means a growing role for the state as lead actor and arbiter of the Chinese economy, and growing support for “national champion” Chinese firms, both at home and abroad.
With the uptick in domestic protections against Chinese exports (steel, tire tariffs), we’re just starting to see an American backlash to this Beijing response. The argument runs as follows: Domestic industry subsidies and fixed yuan/dollar peg have allowed the Chinese government to draw wealth away from the U.S. economy by allowing its export-focused industries to sell to the American consumer for artificially cheapened prices. By that logic, China hasn’t just been a free rider in the international system — but more directly on the U.S. economy. Therefore, China’s plans for its immediate economic future are fundamentally incompatible with the vision of “global rebalancing” as laid out by Larry Summers and other Obama administration officials. This is the crux of the tension in the U.S.-China relationship — by way of protectionist policies and slower consumer spending, the United States is rejecting China’s development model.
In 2010, a midterm election year with high unemployment, labor and even some industry groups will lead the Obama administration to send the message that China’s economic policies cannot persist and will lay down the gauntlet with more tariffs on Chinese exports. We’ll see more intense politicizing of exchange-rate policy (especially absent a significant rise in the yuan); investment policy tensions both in the United States (Committee on Foreign Investment in the United States) and in China (greater state preferences for local firms); China-bashing when Obama pushes cap-and-trade in the Senate; growing trade tensions (especially on steel); and issues involving cyber-security. And if any new “product safety” scandal emerges involving Chinese manufactured goods in the middle of those tensions, we’ll also see a populist American push against goods “made in China.”
A recent Pew-CFR survey reported that 44 percent of Americans believe China is now the “world’s leading economic power.” Just 27 percent say it’s the United States. In 2008, we saw the last U.S. presidential election in which the overwhelming majority of voters didn’t know or care where the candidates stand on China. The shift begins this year.
2. Iran
By far the biggest purely geopolitical risk in 2010 comes from Iran. Its government now faces growing pressure on three fronts. At home, the regime has had a tough time since last June’s presidential election; hardliners had initially consolidated but are now under intensifying pressure as domestic protests continue. Regionally, Tehran has lost considerable influence, with elections in Lebanon turning against Hezbollah, rising Iraqi nationalism making it harder for Tehran to exert influence upon their principal historic competitors, and Iran’s financial outpost in Dubai put at risk by the growing influence of Abu Dhabi.
Globally, Iran faces a considerably tougher sanctions regime over its nuclear program, a push spearheaded by the United States, Europe and Japan, with even Russia and China unhappy over Tehran’s aggressive rhetoric. A Western push for negotiations will continue, but divisive local politics and insufficient leadership coordination make it very unlikely that Iran’s leadership could reach a negotiated settlement even if it wanted one. And it doesn’t. Even under considerable domestic pressure, the hardliners in charge of the regime will continue to try to buy time to achieve their nuclear ambitions.
That’s why the government is likely to overreact to sanctions when they hit. 2010 carries the highest risk to date of Iranian provocation in the region, in the form of harassment of shipping in and around the Strait of Hormuz, support for radical organizations in neighboring countries, and instigation of trouble for Iraq and other neighbors in demonstrations of muscle. The Iranian regime looks increasingly like a cornered, wounded animal. In 2010, it’s likely to act like one.
Israeli military strikes have actually become less likely — certainly for the first half of the year as sanctions are put in place. Faced with strong opposition from the Obama administration (even as it uses the threat of strikes to gain support for sanctions and to pressure Tehran), mounting intelligence challenges on the location of key Iranian targets, and recognition of the military limitations of Israeli strikes, some Israeli government officials now privately are beginning to discuss how to cope with an eventual nuclear Iran as much as the nature of its “existential threat.” Still, the perceived Israeli national security issue is enormous. Looking toward the final months of the year, the Israelis remain an important question mark.
Over time, if the regime in Tehran remains in power, the Iran danger will become more diffuse and start to look more like North Korea. It’s clearly a significant long-term negative for global stability. Though for Iran itself, by 2011, we’ll probably see a bunch of countries start thinking about how they’d like to start investing there, even as the Western powers seek to prolong sanctions.
3. European Fiscal Divergence
Political risk returns to the Eurozone in an important way this year, with the consequent blurring of the distinction between “mature” and “emerging” markets. Fiscal policy coordination has been eroding for some time, and member state political processes are highly uneven.
Greece, Ireland, Spain, Portugal and Italy face the most complex fiscal challenges, and while Ireland appears ready to make aggressive budget cuts, the others are reluctant. Defaults remain possible, since EU support should not be considered automatic. But policy changes will have far-reaching implications even without a default, with a new set of risks arising from fundamentally new political drivers at play in the Eurozone — and a consequent growing importance of political factors in healthier European economies. We’ll see this arise as tax structures are revisited, governments continue to use fiscal tools to support specific firms and sectors, and as policymakers struggle to adapt domestic politics to the more pressing public financing challenges elsewhere in the Eurozone.
There are related risks in Eastern Europe, particularly if European Central Bank liquidity measures are curtailed. This has long been, and still is, a major concern for Austria, given its bank exposure. This is compounded by overlapping exposure in economies where Greek banks are systemically important. In this vein, if one of the big Western European banks active in Eastern Europe gets in trouble, a rescue effort would be extremely messy.
4. U.S. Financial Regulation
On balance, 2010 is looking like a tougher year for President Obama than 2009 proved to be. Going into the new year, he has succeeded in kicking Afghanistan and climate change down the road, but pulling off a real policy success on either still looks unlikely. Unemployment remains high as the country pulls weakly out of recession and midterm elections appear on the horizon. While Obama’s popularity may take a beating, the coming year will see considerably less actual domestic policy risk in the United States than in 2009. But the exception is in the process of financial regulatory reform. That’s likely to be a tougher issue than people expect.
The reform package that passed the House of Representatives is comprehensive, though it will be moderated in the Senate, where for the first time under Obama a serious bipartisan effort is being undertaken. Either way, substantial change is afoot — more far-reaching than anything we’ve seen since the Great Depression. The result will be a structure put in place to monitor and address systemic risk, largely self-financed from the financial community, as well as changes on many other issues, ranging from derivatives regulation to the proper role of the Federal Reserve Bank.
Unlike cap-and-trade or immigration reform, there’s a very high likelihood that comprehensive financial regulatory reform will pass. But with mid-term elections approaching, it’s likely to turn populist and lose a considerable amount of its bipartisan flavor. Congress as a whole is likely to imitate what’s already come to pass in the United Kingdom, where an unpopular Gordon Brown government is going after the financial sector to try to lift its poll numbers from the morass. Congress doesn’t want to be tarred by Treasury Secretary Tim Geithner, bailouts or billionaire bankers. The best way to avoid that fate is to include some visibly populist elements in the new legislation, especially on consumer protection and executive compensation. Members of Congress will look to score points by taking aim at the Fed, but actual policy change there is a step too far — the administration will likely ensure that nothing in the ultimate bill will undermine the Fed’s political independence.
But while President Obama’s economic team will be wary of populist measures, Democrats in Congress and the president’s own political advisers will see such measures as a necessary piece of “mobilizing the base” before midterm elections. Big banks are an easy target, especially in the context of high profits and a strong recovery for the financial markets, but a weak overall economic rebound. The legislation should pass by late spring.
Regulators will be given significant new discretionary powers, including some authority for breaking up institutions deemed a systemic risk. A key risk is that, depending on the political environment, the newly empowered regulators could use their capabilities to issue strict rulings that go well beyond what is specifically included in the legislation. Regulators will also likely issue proposals for revising capital requirements upward next year.
Another key risk to watch will be efforts to impose further fees and taxes on the financial system. With the U.S. government running record deficits in the wake of the financial crisis, trying to recoup these costs from the financial services industry will be seen as a relatively low-cost political option. Executive compensation is one likely possibility; taxes on carried interest for hedge funds are another.
Both the Americans and Europeans are aware of the risk of driving the financial industry into the ground with too much (or too drastic) regulation or taxation. But as reform becomes an election-year domestic battleground, the need to serve political interests will be increasingly at odds with the need to create an efficient framework for regulatory reform.
5. Japan
What happens when the ruling party loses power in a one-party state? You get a zero-party state. That has effectively happened in Japan, and it’s hard to overstate the importance of the sweeping political change — indeed it’s unprecedented for a major industrial democracy. The new Democratic Party of Japan’s efforts to limit the influence of bureaucrats and industrialists are creating higher policy risk, especially after upper house elections in the summer.
Currently, Prime Minister Yukio Hatoyama is holding back on that agenda given coalition and electoral constraints. But indications are that the DPJ would stick with its electoral mandate and not continue its present more cautious policy positions if it gains control of the upper house. Given Japan’s extraordinary fiscal constraints, that’s going to be tough to pull off, particularly since the sidelining of senior technocrats makes it much more difficult to put flesh on the bones of DPJ policy goals.
The real power in the DPJ regime is long-time party boss Ichiro Ozawa, who, himself tainted by scandal, remains outside the cabinet and so behind the formal policy scene. It’s quite possible that Hatoyama won’t last the year. He’s not a skillful campaigner nor an effective decision-maker, and has a scandal of his own around his neck. Insiders are already looking to someone like Deputy Prime Minister Naoto Kan or even the more youthful and policy-savvy Kazuhiro Haraguchi to take Hatoyama’s place — even before the upper house elections.
If so, regardless of the merits of the actual successor, the DPJ will appear to be simply a continuation of the post-Koizumi era succession of weak governments, but this time without the benefit of a strong unified bureaucracy to guide policy and with a much more worrisome economic situation. Meanwhile, uncertainty over how 2010 will play out for the DPJ and the party’s less favorable disposition toward the business community is likely to harm financial confidence, deepening economic woes.
Some pundits worry that the United States will replicate Japan’s lost decade. For 2010, the greater risk is that Japan might be starting another one.
6. Climate Change
Before Copenhagen, the prevailing presumption was that 2010 would be the year when a global treaty, including the United States, China and India, really got done (though even a year ago, we were far less optimistic). After Copenhagen, we look years away from such a treaty, and there is a growing likelihood that it will never happen.
From a market and industry perspective, the failure to establish clear timetables and goals at Copenhagen complicates investment decision-making for everything from renewable energy investments to forest product management to commodity price forecasting. On the latter, natural-gas markets emerge as a loser from the climate-change gridlock. While the overall trend is toward greater use of natural-gas-fired generation for electricity in North America, the implementation of an actual carbon price is crucial to unleashing new investment and encouraging fuel-switching. The absence of this catalyst (outside of the European Union) increases the likelihood that the current weak price environment for natural gas is likely to continue, creating problems for gas exporters from Russia to Bolivia.
The Copenhagen outcome makes it even less likely that the United States Congress will pass cap-and-trade legislation in 2010. Though Obama’s political advisers see a big push for cap-and-trade as a way to energize the base and sharpen distinctions with Republicans ahead of November’s midterm elections, they don’t have an international treaty to use as a pressure tactic to move votes forward in the Senate. Opponents of the legislation will use the absence of a substantive agreement with China as further reason to balk at American commitments. Moderate Democratic Senators in poor and energy-intensive states strongly oppose the climate-change measure and will not provide the votes that Obama needs.
The Copenhagen failure also makes it more likely that individual countries will move to “nationally appropriate” mitigation measures. Countries like China, India, Canada, Brazil and eventually even the United States will move toward an increasingly heterogeneous set of policy responses, including intensity-based goals, renewable energy mandates and even carbon taxes, creating a greater challenge for international coordination.
The lack of an international framework will complicate compliance efforts by multinational corporations that have carbon footprints in dozens of countries at once. More significantly for global politics, technical disputes over implementing and verifying actual emissions from these uncoordinated systems will create diplomatic tensions, particularly between the United States and China. And a multilateral stalemate is likely to intensify the existing rift between industrialized and G77 countries. Lastly, the risk of trade disputes over carbon will rise as disparate policy responses heighten concerns over firms relocating to countries with more lax carbon policies, and border adjustment measures gain traction as a result.
7. Brazil
After years of being wildly bullish on Brazil, we’re in for a bump. The country stands to gain from a strong rebound in growth over the course of 2010, but Brazil’s newfound economic abundance will lead to a drop in the quality of economic policymaking — both on macroeconomic policy and, to a much greater extent, through leaning more heavily on state-owned enterprises. As a result, 2010 will be marked by growing investor concern on both macro and sectoral policy as the October presidential election draws near.
Brazil’s challenge of abundance looms greatest in the oil sector. The government wants more control over resources and has very little desire to allow the international community to profit unduly (or, in some cases, even duly) from the exploitation of the country’s vast new oil frontier. With Lula’s political capital running high, he should be able to approve legislation creating a new exploration and production framework that relies heavily on state-owned Petrobras. What’s happening in the oil sector, while more extreme, should be seen as part of a broader trend whereby state enterprises grow in relevance and industrial policy becomes more inward focused. That’s a negative for Brazilian markets. A rosy economic outlook is also likely to impact the discipline of macroeconomic policymaking. The Lula administration isn’t about to abandon a macroeconomic framework that has proved wildly successful, but lowered fiscal vulnerabilities will tempt the administration to keep fiscal policy expansive for longer than markets would like. That will put additional pressure on the central bank precisely when the membership of its board may be in flux — as Henrique Meirelles, the president of the central bank, considers a run for elected office.
Markets will thus become jittery as the elections draw near, particularly given that some of the concerns will be overblown when investors awaken to these risks more explicitly. Lula’s handpicked candidate Dilma Rousseff enters 2010 favored to win the election, and she will undoubtedly deepen the government’s turn toward a bigger state. Sectoral policy won’t be evenly problematic — in the telecom sector, these drivers exist, but are weaker; while in transport infrastructure, the political push actually goes the other way (more foreign investment needed given the scope of projects needing completion before the World Cup in 2014 and the Olympics in 2016). If opposition candidate Jose Serra wins, the sectoral upside will be larger given the lack of a bias toward state-owned enterprises, and fiscal policy will be tighter. But markets will surely be concerned over his longstanding criticisms of both exchange and monetary policy.
The situation is a little like post-Mandela South Africa (though from a more attractive economic trajectory), where people and markets expected continuity until Thabo Mbeki disappointed. Leaders like Mandela and Lula are impossible acts to follow. Post-Lula Brazil will not have the capable policymaking of the past several years, and Brazil will be in for a bumpier transition as a new administration seeks to put its stamp on managing the country’s newfound economic wealth. Still, the long-term outlook for the country remains strong. By 2011, Brazil should be set for a bounce.
8. India-Pakistan (no, not Afghanistan)
South Asia is still a morass in 2010. But the U.S. troop surge has given Obama some time. Afghanistan will produce bigger and bigger domestic headlines, but not much will actually change until the United States reaches (or, more likely, is forced to reach) a decision point. For now, that’s 2011 at the earliest.
Having said that, there’s a broader South Asia risk developing this year. The decision by Pakistan to go after terrorists domestically provides Islamic extremists with powerful reasons to expand asymmetric attacks on Pakistan’s urban centers and to try to reignite Indian-Pakistani conflict. That’s easy enough to do. Pakistan’s extremist groups have increased in sophistication and consolidated their capacity, both by joining together and by forging closer links to al-Qaida in the region. In Pakistan, a significant proportion of the population continues to believe that terrorist attacks against the population originate in India. Pakistani networks operating in India haven’t gotten much attention, however, and represent a weak link on the counterterrorist front.
This means that the likelihood of attacks in India and against Indian targets in the region is increasing, a particular worry given the nature of the potential targets (government facilities and densely populated urban areas). The Indian government is aware of the threat and has sought to improve its counterterrorist response — including via increased ground-level coordination in Delhi and Mumbai with American and British counterterrorist organizations. But progress has been slow, and India’s counterterrorism capacity remains underdeveloped, badly coordinated and vulnerable.
Meanwhile, any new attacks would put serious pressure on India to take a tougher line on Pakistan. India’s Congress Party leadership is loath to escalate military tensions with Pakistan. But following a quieter line after the Mumbai attacks in late 2008, it made strong demands on Pakistan to take decisive steps against extremist networks with ties to India. Successful large-scale attacks would undermine the Congress Party’s credibility on the issue, leading the Indian government to take outsized steps in raising the military posture toward Pakistan. That, in turn, means Pakistan shifting its focus away from the tribal areas and, as importantly, changing its strategic view on taking on further operations — a shift that would sit comfortably with much of Pakistan’s senior military command, who still see rising India as Pakistan’s main strategic challenge.
Indian-Pakistani relations, which had been quietly improving during the final years of the Musharraf regime, have already deteriorated somewhat under President Asif Ali Zardari, and it will prove harder for both sides to back away from any high-level military alert. Meanwhile, in both Delhi and Islamabad, Obama’s pledge during his Afghan speech to begin U.S. troop withdrawals in 2011 is being read as a signal that the U.S. is minimizing its long-term commitment to the region. This feeds the already powerful views in both capitals that they should plan for continuation of their long-term strategic rivalry. Worst case, should there be a series of terror attacks in India, we could see Indian efforts to secure international sanctions against Pakistan — and potentially surgical strikes by India against military training camps inside Pakistan. In short, for the first time in nearly a decade, there are serious factors pushing the Indian and Pakistani governments back toward confrontation.
9. Eastern Europe, elections and unemployment
Coming out of global recession, historically high levels of unemployment are a critical factor in a solid majority of the world’s economies. But as a political risk, it’s perhaps most worrisome in Eastern Europe — where upcoming elections in a number of key countries materially increase the likelihood of instability.
High unemployment weakens the popularity and limits the flexibility of incumbent governments, making political leaders especially sensitive to domestic economic and social constituencies, and increasingly tempted by protectionist, nativist and populist policy options. That’s particularly true where elections are on the horizon, as candidates look to channel the frustration and anger of the unemployed. Governments will increasingly come into conflict with monetary authorities and international lenders such as the International Monetary Fund, which in turn may send very negative signals to capital markets investors — introducing yet another set of risks to financial stability. In Eastern Europe, Ukraine, Hungary and Latvia look the most vulnerable, but even solid regional performers like Poland may face stresses in the coming year.
Ukraine’s economic contraction and related jump in unemployment has been dramatic. With two rounds of presidential elections likely in the first quarter of 2010, then perhaps fresh parliamentary elections as well, politicians are under enormous pressure to boost public spending and assist debt-burdened enterprises. But this is all in a context of a crucial IMF agreement and framework that puts serious constraints on public spending in return for loan support and guarantees. Whoever emerges as the president and parliamentary leaders will find it incredibly difficult to balance these two sets of competing demands this year.
Hungary’s current government has succeeded in staving off a full-blown financial crisis by implementing a series of IMF- and EU-mandated fiscal reforms in the past year. But the economic fundamentals remain weak, unemployment has shot up dramatically, and national parliamentary elections are due in the spring of 2010. The leading opposition party, Fidesz, will almost certainly win those elections, but they are already signaling that they want to re-negotiate IMF-EU mandated budget deficit and spending targets for 2010. We also expect a surge of populist and anti-foreigner rhetoric from Fidesz ahead of the elections. Even if the new government responds to market and IMF constraints after it is elected, the election buildup will worry investors — a dangerous scenario given Hungary’s fragile standing in markets.
Latvia, the other particularly high-risk country in the region, also has elections due this year, and politicians there will feel similar social pressures. Relative safe havens such as Poland and the Czech Republic will also have noisy (presidential and parliamentary) elections this year. While the political and economic outlook for Poland remains solid, it’s not smooth sailing. If the Polish government’s leading presidential candidate (Donald Tusk) is underwhelming, populist/nationalist opposition politicians will pounce, highlighting the growing unemployment in the region’s largest economy, which may look more vulnerable as a result.
10. Turkey
There’s very little “country risk” in the top 10 this year, but trends in Turkey are sufficiently worrisome that it deserves a slot. Domestically, an increasingly unpopular AK Party, facing popular fallout from the economic downturn, is embroiled in intractable and increasingly interlinked fights with the judiciary, industrialists, and the military. The party’s experiment with trying to buy some support from Turkey’s Kurdish population failed, which not only loses them the Kurds but many Turks if there’s further social instability as a consequence — as seems likely. Meanwhile, there’s growing political pressure within the AK Party to keep would-be splinter Islamist forces onside and to formulate policies that appeal to more emotive calls from that base.
Turkey’s international orientation is moving away from Europe and closer to Iran and Syria — driving further domestic wedges between Turkey’s Islamists and secularists. And while Turkey’s EU candidate membership status isn’t going to shift in 2010, the threat of confrontation looms larger, especially as Cyprus negotiations, which seemed on a strong track, now look like they might leap off the rails. Prime Minister Recep Tayyip Erdogan’s principal diplomatic success is with Armenia. That’s important historically, but not for the country’s relationship with creditors at the IMF. And though Iraq looks better (more on that in a moment), if there’s a worry, it’s the unsettled status of Iraq’s Kurdish north — just across the border from Turkey.
In short, country risk is hitting Turkey from just about every side. By year’s end, the fight for the coming year’s elections will heat up. Unlike in Brazil, 2011 doesn’t look like a bounce.
Red Herrings
Iraq
Elections in March will spark violence as al-Qaida makes a bid to undermine the transition to Iraqi national sovereignty. A U.S. troop withdrawal beginning right after the elections will invite more violence. But compared to what we’ve seen before, and what might have happened, the overall story is remarkably positive. For the markets, Iraq is suddenly an opportunity. The institutions are becoming legitimate (even with the unresolved Kurdish issue), the army is starting to work, and most importantly, political leaders from all communities are beginning to recognize the value of Iraq’s tremendous natural resource base from which all can benefit if they make the compromises to maintain stability in the country. For all their basic governance problems, there’s very little chance of Iraq actually becoming a failed state at this point — a meaningful risk even a year ago. It’s not a place we’re ready to vacation in, but we’re bullish on Iraq.
Iraq is also moving in a positive geopolitical direction. Ties with Turkey have grown particularly quickly — not just in the Kurdish region in the north, but in Baghdad. That’s one of the few positive stories for Ankara this year. Arab states in the region are still hesitant to build ties with Iraq as they wait for clarity on its next government. Prime Minister Nouri al-Maliki hasn’t been a popular figure with neighboring Gulf Arabs, but they recognize that Iraq’s economic consolidation won’t wait for another four years, and they’ll start making political overtures to Baghdad if Maliki’s mandate is extended. And if the Iraqi prime minister isn’t returned (which is certainly plausible), we’ll see a stream of head-of-state visits to place relations with a new leader on a more solid footing. So whatever the electoral outcome in March, we’re likely to see Iraq on a faster path to integration with regional political and economic infrastructure next year. Meanwhile, Iran’s role in Iraq has quietly receded. Iran’s controversial presidential election and subsequent state violence did nothing to improve Tehran’s influence among Iraq’s Shiite population, where Iraqi nationalism has been steadily growing.
The headlines for Iraq next year will undoubtedly be the timing/delays/pace of the U.S. troop withdrawal. But the real story is going to be a moderate government, growing geopolitical influence, and the most exciting new investment opportunities the region has seen in a decade.
The Persian Gulf
Iraq’s gain trumps Dubai’s loss in the Persian Gulf, and the rest of the region is doing just fine. There is strong political stability; increasingly coherent policy approaches; and lots of reasons for broader, more sensible investment trends diversifying away from over-reliance on oil.
The outlook is particularly promising for Saudi Arabia, where there’s strong reason to believe that political succession will ultimately be handled well. And they’re slowly but surely unlocking the economic potential of larger and larger pieces of their country –geographically, sectorally and, most important, demographically. Neighboring (and far more socially liberal) Bahrain will also benefit significantly from that trend. Abu Dhabi is taking over more coordinated direction of economic (and regional political) policy for the United Arab Emirates, a far more sensible model for national development. Smaller countries like Oman and Qatar have the economic and political stability to benefit from the region’s rise.
Russia
This year, Russia gets through the downturn and starts to look stable again. Prime Minister Vladimir Putin will feel more confident, and anybody who doesn’t agree with him can leave or face the consequences. The country doesn’t really deserve to be a BRIC, because its longer-term trajectory is more ominous (with a tough geopolitical neighborhood, a precipitously declining population, and negative trends in governance). But for this year, especially with energy prices having doubled off their lows, Russia will go back to being uninteresting.
The dollar
The United States will continue to run a massive deficit with crisis reduced tax revenues, high levels of spending and few near-term moves to raise revenue in the cards for 2010. And while the Obama administration has big plans for fiscal responsibility, much of it is hard to get through Congress, while other pieces of the plan are typical/political accounting sleight of hand. With the Chinese saying the world needs a new reserve currency and the Indians buying gold, does anyone believe in the dollar any more?
Well, yes. But it’s important to start with recognition that the dollar’s relative value and reserve currency status are related, but separable. A weaker dollar can still be the primary reserve currency — that’s been a long running story over the past six decades.
The status of the dollar as the world’s reserve currency is much stronger than the hyped commentary. To paraphrase Churchill, the dollar’s outlook is the worst of the developed currencies out there . . . except for all the others. For now, if there’s dollar weakness, it’s at least in part that the United States wants a weak dollar to boost exports (since domestic consumption is going to stay weak for a while). Longer term, U.S. demographic growth, the pull from higher education, a strong penchant for innovation, a continuing military lead (which will increasingly matter for commodities), underlying political stability and sheer size will keep the dollar going as the world’s preeminent reserve currency.
That’s not to say there’s no structural weakness. Over time, should China manage its challenges successfully, the yuan will rise in both value and utilization. But for the foreseeable future, even if the dollar’s relative value falls, its reserve currency role is not going anywhere in the next decade and probably well beyond. Similarly . . .
New York and London
All this fear about “finance” running away from New York and London — because of regulatory burdens or growth outside the developed world — is misplaced. Bankers like to complain about regulations and to threaten to move elsewhere. It’s far harder to execute. The slow pace of change is particularly true for the physical location of the top financial markets, and the fact that Singapore does more bond issuances in one particular year than does London doesn’t mean it will overtake the city anytime soon. Since the year 1600, there have been three top financial centers: Amsterdam, London and New York (well, Paris too, which made a run at it in the 18th and 19th centuries). Rapid and massive shifts in the way money is intermediated are unrealistic.
Capital can be generated anywhere (Chinese factories, Middle East oil, etc), but capital intermediation (most finance) needs a set of special political, economic and social conditions in which to thrive. Structurally, successful capitals of finance require stable legal systems; stable political systems; effective/apolitical policing of corruption; low levels of social unrest and violent conflict; large and highly literate workforces; a large economic base to sustain financial activities; and a liberal policy orientation that welcomes cross-border flows of people, goods and capital. Except for the United States and the EU/Switzerland, only Tokyo meets all these requirements. But Japan has elements of a closed economy, lacking as much of an international orientation, as reflected in a relatively low level of English proficiency.
If the United Kingdom truly cracks down on its financial industry (a possibility), some of it will disperse — with New York standing to gain the most. If the United States decides to impose tough regulations while Europe doesn’t (much less likely), we’ll see more dispersion, with smaller jurisdictions picking up some of the more risky/profitable activities (hedge funds). But for the most part, large financial institutions will stay put, grumble and try to reverse whatever regulations the United States and the United Kingdom burden them with.
(Ian Bremmer is president of Eurasia Group, a political-risk consultancy. He is the author of “The J Curve: A New Way to Understand Why Nations Rise and Fall.” David Gordon is head of research and director of global macro analysis for Eurasia Group. They can be reached via e-mail at research@eurasiagroup.net.)
Wow… I’m almost speechless.
I found this video and at first I thought, “how sweet of him to help out the homeless.” The video is of Diddy leaving a club, buying roses for his entourage, and giving a homeless man $100. (I thought this was a nice tie in with “It’s all about the Benjamins” song we all know and love.) I digress.
The global economy is poised to grow 2.7 percent this year, but the recovery will be slow as the impact of fiscal stimulus wanes, the World Bank has said in a report.
Just a quick post this morning while I enjoy a nice warm cup of joe. I want to point everyone to my new social vibe widget, I felt the need to change it yesterday as images of Haiti filled my TV screen, mind, and heart. I don’t think any one of us can understand the amount of destruction that has happened to that wonderful, beautiful place and even with a mom like I have and the emotional and physical abuse I had to endure because of that, I can’t understand the destruction of the lives of the people that call Haiti their homeland, their soil, their heart and souls. Think of your favorite city and imagine walking through it with 50,000 dead people lying in the streets. I think anyone of us would call a place like that uninhabitable; terror and horror would fill our minds and hearts.
More than half of Hamid Karzai’s new nominees for cabinet posts have been rejected by the Afghan parliament. In this new vote, 10 of 17 new nominees were rejected (photo, from bbc.co.uk). This vote came two weeks after MPs turned down most of Karzai’s first choices.
