Thursday, November 20, 2008

Obama To Do The Desperate

The News:

Obama set to implement 'radical' economic policies: Report

Thu, Nov 20 02:34 PM

President-elect Barack Obama is promising to intervene in the economy in ways that United States hasn't tried since the 1970s, favouring some industries and products while hobbling others, a media report said on Thursday.

Under his financial policies, the Wall Street Journal reported, banks seeking government assistance would be forced to lend and to halt foreclosures. Automobile companies would be pushed to change their product lines to more advanced, fuel-efficient vehicles.

Billions of federal dollars would promote solar, wind and biomass energy, while dirty coal power could be priced out of business.

Obama advisers were quoted by the paper as saying that difficult times necessitate extraordinary measures. "We are in the midst of a massive reorganisation right now in autos but also other areas as well - finance, information technology. All of this flows into...the new green energy economy we are living in, albeit in an embryonic stage," David Bonior, an economic adviser to Obama and proponent of a more interventionist industrial policy in the 1980s, told the paper.

Asked if this was the industrial policy of the incoming Obama administration, he replied: "The answer is yes."

Critics and advocates alike, said the Journal, see the re-emergence of government economic steering that was in vogue when Japan, South Korea and Germany embraced it three decades ago, then discredited after its key practitioners slipped into deep economic funks. With the upheavals in world capital markets, pure free-market policies are facing more criticism, it noted.

My View:
I have two views on this news -

  1. I am true believer in free market economy and in my opinion govt should always keep away from the economic affairs. If markets are truly left on their own, they will always find equilibrium but govt interventions are always detrimental to the long term health of markets. Thus, this motive of Obama, although in good intent, might be dangerous in the long run economically.
  2. I am a GREEN LOVER. I strongly dislike the rampant use of fossil fuels as primary source of energy and so this act of Obama might be a good news for eco-friendly humans all around the world. To promote green energy and discourage non-eco-friendly technology and products can be a first step toward better life for our endangered future generations. I would personally congratulate Obama and wish he has the political will and courage to fight enemies of earth. However, he needs to tread with caution as intervening in economy has always proven to be bad for the long term sustainability.

Saturday, November 15, 2008

Bretton Woods Vol-2 - FAILED

The News:

Termed by many pundits as Bretton Woods II, the Nov 15 Meeting of global "leaders" to combat financial crisis failed to arrive at concrete solution. WSJ or Wall Street Journal reports with this interesting headline:

"G20 Summit Presents United Front, but Offers Mostly Promise"
WASHINGTON -- Global leaders showed a united front against the financial crisis at an emergency summit here Saturday, but offered mostly promises of future cooperation to nudge the world out of its economic funk.

Heads of the Group of 20 industrial and developing nations vowed bold action in a host of areas -- from enhanced oversight of financial markets to reform of the IMF and World Bank -- and urged governments to implement "appropriate" fiscal and monetary policies to shore up sagging economic growth.

But the group, which met for less than six hours in the National Building Museum, left most of the tough decisions to future meetings. The next one will be held before April 30, pressuring President-elect Barack Obama to confront a tangle of high-stakes economic and regulatory issues immediately after taking office.

The Bush administration lauded the summit, which was arranged in less than a month as world leaders scrambled to keep the economic downturn from snowballing.

"I don't think we could have predicted then how productive and how successful this meeting would have been," President George W. Bush told reporters following the summit. "There is more work to be done, and there will be further meetings." Japanese Prime Minister Taro Aso said the cooperation among world nations is important in limiting the depth of the financial crisis. "It does no good to simply panic in a crisis, and that is proven by the Great Depression of 1929," Aso said. "Today things are entirely different...we have a framework for cooperation."

My View:

Well, well, well. Politicians achieved what they are ususally good at : PROMISES for future. The so called leaders atually were not supposed to find a solution but look at the way Bush describes it !!! hilarious !!!

If these so called leaders have the slightest of sense, then they should look for the root cause of this mess - the FIAT MONEY. Its not that we can't get over the evils of this crisis, we can. The only thing we need to do is have leaders like Dr. Ron Paul and start listening to his thoughts.

Friday, November 14, 2008

Fired Worker Kills People

The News:

Sat, Nov 15 09:48 AM

SAN FRANCISCO (Reuters) - A man laid off recently from his job in Silicon Valley shot and killed three people, believed to be former co-workers, at an office park on Friday, police in the ailing U.S. technology hub said.

The 47-year-old suspect, identified by police as Jing Wu, was still at large after gunning down two men and a woman shortly before 4 p.m. local time (0000 GMT), Santa Clara, California, police told local media.

Police did not identify the firm, which had employed the suspect, local radio and television reported.

An online business directory listed a man with the suspect's name working at Siport, a semiconductor company at the address of the killings. Siport was not immediately available for comment.

As the U.S. economy has weakened, technology companies have joined the rush to cut costs and lay off workers.

Sun Microsystems, one stalwart of the industry, said on Friday it would cut up to 6,000 jobs, 18 percent of its workforce.

My Views:

This is how things turn when the excesses that were done in previous years are blown out. The criminal is not that poor guy, who lost his job, the criminals are those who occupy office at the highest level (read Greenspan) and make decisions that lead to such incidents. Had Greenspan not created this bubble, we'd have a very different set of news stories today.

Taslima "Forced" to Leave India

The News:

Fri, Nov 14 03:46 PM

Exiled Bangladeshi author Taslima Nasreen has again been "forced" to leave India after her brief stay India, prompting the controversial writer to question the country's alleged secular credentials.

The writer, who returned to India on August 8, said she had to leave on October 15 following the government's dictum. "Yes, I was forced to leave India once again... The government gave me resident permit for 6 months with a secret condition that I must leave the country in a few days," she said in an e-mail interview.

The ex-physician-turned-feminist author, who is under attack from Muslim fundamentalists for her book 'Lajja', said she is now somewhere in Europe, delivering lectures.

My View:

I am really surprised why a person of the stature of Taslima Nasreen desired to live in India in the first place! The kind of job she does (calling a spade a spade) is not favourable in Indian life and moreover, the freedom in India is the "right of powerful people to disrupt that of others". Is she so unaware of even how people of one region (e.g. Maharashtra) hate and beat people of other regions (e.g. Bihar).

Is she unaware of how one can't travel at will (anyone can call a "chakkajam", stopping traffic), can't sleep at will (so much noise pollution day and night by so many things), can't get through bearocracy for smallest things (try getting a driver's licence without agents) etc etc.

She has the luxury of living in any free society like Western Europe or US and if she still wishes to live in India or bangladesh, then there must be something wrong with her.

Thursday, November 13, 2008

US Unemployment on a New HIGH

The News:

Jobless claims jump unexpectedly to 7-year high

Jobless claims jump to 7-year high, signaling rapid deterioration in the labor market

WASHINGTON (AP) -- The number of newly laid-off individuals seeking unemployment benefits has jumped to a level not seen since just after the Sept. 11, 2001, terrorist attacks.

The Labor Department on Thursday reported that jobless claims last week increased by 32,000 to a seasonally adjusted 516,000. That nearly matched the 517,000 claims reported seven years ago, and is the second-highest total since 1992.

The total also was much higher than analysts expected. Wall Street economists surveyed by Thomson Reuters expected claims to increase only slightly to 484,000. Initial claims from two weeks ago were revised upward Thursday by 3,000 to 484,000.

The increase puts jobless claims at levels similar to the recession of the early 1990s. The four-week average of claims, which smooths out fluctuations, increased to 491,000, the highest in more than 17 years.

My Views:

Unexpectedly? why? Everybody who is in his / her senses expected this and even worse when it is revised later. In times of increasing worries, things turn out uglier than most "analysts" think. Nothing surprising in it.

Wednesday, November 12, 2008

Paulson Cheats US Taxpayers

The News:

Stocks lower as Paulson unveils change in bailout

Wall Street losses steepen as Paulson unveils plan to not buy distressed bank assets
NEW YORK (AP) -- An already disheartened Wall Street turned sharply lower Wednesday after Treasury Secretary Henry Paulson said the government won't buy banks' soured mortgage assets after all, disappointing investors who hoped to see the bad debt wiped off companies' books. The Dow Jones industrials fell more than 270 points, and all the major indexes dropped more than 3 percent as the market retreated for a third straight session.

Paulson said the government's $700 billion financial rescue package won't purchase troubled assets from banks as originally planned. He said that plan would have taken too much time, and that the Treasury instead will rely on buying stakes in banks and encouraging them to resume more normal lending.

While the market had been pleased by the government's decision weeks ago to buy banks' stock, investors still hoped to see the financial industry relieved of the burden of the mortgage assets whose decline in value helped set off the nation's financial crisis.

My View:

So what were you thinking? how can you trust politicians? This is the kind of breed (politicians) who can ruin you and you still say thanks!!! Perhaps "you" are responsible for not falling in my category - people who never believe politicians.

Now Paulson has "different" reasons to "use" those USD 700 Billion that he and his boss Bush 43 cheated along with others of their category.

However, in my view, even if they went on to purchase "distressed" assets, it would have been still a fool's job. But at least they should have kept their word.

Monday, November 10, 2008

Blooger and Poet Jailed !!! Shame on Myanmar

The News:

Reporters Without Borders Monday called on bloggers worldwide to protest the jailing of a fellow blogger by the Myanmar military junta for criticising it.

In a statement in Montreal, Reporters Without Borders and the Burma Media Association in Canada said that a Myanmar court Monday jailed blogger Nay Phone Latt for 20 years and six months for criticizing military junta head Gen Than Shwe.

A poet, Saw Wai, was also sentenced to two years in prison for writing a poem critical of the junta head.

``The authorities have imposed an extraordinarily severe punishment on Nay Phone Latt just for using the Internet,'' the two organisations said in their statement.

``This shocking sentence is meant to terrify those who go online in an attempt to elude the dictatorship's ubiquitous control of news and information, and we call for his immediate release.

``Saw Wai, for his part, is being made to pay for his impertinence and courage as a committed poet.''

The two organisations called upon bloggers all over the world to protest against Nay Phone Latt's arrest by carrying his photo on their blogs and writing to Burmese embassies worldwide to seek his release.

My View:

This is shocking, not only the oppression of blogger and poet but our (we blogers) attitude of keeping silent. It happened in Myanmar, it happened in China and it can happen with us too.

I urge all bloggers to protest it in the best possible way they can.

Write columns, articles on your blogs. Send emails to your friends and aquaintances urging them to join you... DO WHATEVER YOU CAN...

Sunday, November 9, 2008

China Announces USD 586 Billion Stimulus Plan

The News: China Announces a BIG Stimulus Plan
China announced a 4 trillion yuan ($586 billion) stimulus plan to spur expansion in the world's fourth-largest economy, helping sustain global growth as the U.S., Europe and Japan teeter on the brink of recession.

The funds, equivalent to almost a fifth of China's $3.3 trillion gross domestic product last year, will be used by the end of 2010, the Beijing-based State Council said today on its Web site. China will adopt a ``pro-active fiscal policy'' and pursue a ``moderately loose'' monetary policy, it said.

My View:
This news is a surprise to most but the nature of surprise is different. Some will see it as a big positive while others will see the facts behind it - how bad the situation on a global front has become. I fall in the latter category, although I was expecting.
In fact, this announcement should send jitters around markets (they may actually show exuberance) as it shows how big the problem is. China, which was so far being seen immune to global financial crisis, is actually in bigger danger. Some pundits were betting on BRIC (Brazil, Russia, India and China) to show considerable resilience with respect to what is happening around the world. The fact is given that China and India have to feed their almost one third of world population, should make the global financial crisis feel at home with considerable drag on their economies.

Saturday, November 8, 2008

Luxury Car for the Immorals

The News:

The German luxury car manufacturer, Audi, on Friday launched its award-winning super sports car Audi R8 car in New Delhi. The model is priced at 11.7 million rupees and is equipped with an engine displacement of 4,163cc.

The designer of the Audi said that aluminum body and special shape were noteworthy characteristics of the model. Presently, Audi sells Audi A4, Audi A6, Audi A8, Audi Q7 and Audi TT through twelve dealerships across the country.

My View:

In times of world economic crisis and falling jobs which will result in increased number of poors who have to fight hard to earn their daily meal, this kind of non-sense is an insult on the Indian people.

How on earth can one describe the very requirement of a 4 litre plus monster engine driven car !!! The ones who buy the "imported" car are real immoral people.

On a second thought, how will one "enjoy" the performance of this luxury car? The condition of Indian roads and traffic is not a secret. In order to get the excitement and pleasure out of the monster, one must risk mowing down few pedestrians.

"Immoral and Irresponsible" is my phrase for those who buy this car.

Indian Govt Will Spend Rs. 250 Bn on Infrastructure: Kamalnath

The News:

The government will pump-prime the economy by investing Rs.250 billion (Rs.25,000 crore) in areas like infrastructure but without worsening the country's fiscal deficit situation, Commerce Minister Kamal Nath has said.

The minister also said that the government would continue to remain cautious in printing currency notes, so as not to add to the fiscal deficit while making the huge investment. Funds will be found by reallocating revenues.

'So it's going to happen within the confines of good financial management.'

My Views:

I have one word for the idea that Kamalnath shares - BRILLIANT. But, the point is, it should be exactly what he says - "within the confines of good financial management." India has a different economic structure than that of USA, which can be termed as "Cautiously Capitalistic". Infrastructure expenditure of a massive scale is urgently required for real development but we have seen in past that this has a significant impact on fiscal deficit. Whatever enthusaiastic people say, the fact is India is an "Underdeveloped" country if we just consider the majority of population, their education, employment and living standard. A big spending on infrastructure development will be the best stimulus for growth and development of masses.

However, the Commerce Minister's idea to "reallocate" funds is doubtful. Such a big amount can't be just reallocated just like that. Other sectors like education, health are also in big need of capital. The one sector which is unnecessarily occupying a larger than required share is defense. But reallocating money from there will be very difficult and almost impossible considering the political opposition govt risks and that too just before general elections in few months.

As I already said, the idea is brilliant but when we sit down to work out the details, it looks like it would be very difficult to implement without printing more currency (which the minister rejected). If the govt is determined to work it out, they very well, can. But the question is - do they have that kind of political will?

Wednesday, November 5, 2008

Stock Markets in Trouble Again?

AP says:-
Stocks plunge anew as recession worries resurface
Wednesday November 5, 6:29 pm ET
By Sara Lepro and Tim Paradis, AP Business Writer

Wall Street falls sharply as investors, worrying about recess, ponder Obama impact on economy NEW YORK (AP) -- A case of postelection nerves sent Wall Street plunging Wednesday as investors, looking past Barack Obama's presidential victory, returned to their fears of a deep and protracted recession. Volatility swept over the market again, with the Dow Jones industrials falling nearly 500 points and all the major indexes tumbling more than 5 percent.

HONG KONG, Nov 6 (Reuters) - Asian stocks fell sharply and the yen rose on Thursday as more evidence that the U.S. economy is shrinking made investors brace for a potentially deep and lasting global recession.

My View:
I told here yesterday analyzing the up move as that was a suckers' rally and a case of irrational exuberance. Yesterday all mainstream media was describing the up move in markets like a magic by Obama, which eventually lasted only few hours. The fact is global economic troubles are beyond the comprehension of mainstream media and way beyond that of "common investors".

Was Obama Chosen as a Conspiracy?

November 4, 2008 recorded in history as US has first black president.

My View:
Well, actually this is not my original view. In fact one friend of mine - Abhijit, suggested this thing. Doesn't it sound like a conspiracy? CONSPIRACY? what for?

Read the events like this:-

  • Republicans had their president rule for 8 years and the Bush 43 leaves office leaving behind total mess.
  • An African American is chosen by Democrats over an ex-First Lady, considering she was supposed to be their frontline candidate just few months back. The guy became popular suddenly and they presented him as "messiah".
  • Republicans chose their weakest candidate - McCain for president.
  • The weakest candidate chose Palin !!! for vice-president !!! How come?!!! Palin ? can you believe it?
  • Palin amused voters with her language skills and her expenses on dresses etc. (!!!)
Whatever you can think of it, but, I am convinced this all is a deliberate conspiracy. They want a black guy as president of the US of A once, at a time when economy is on the verge of collapse. Do they want to convey some message? may be.

Tuesday, November 4, 2008

Stock Markets Surge Worldwide on Obama Victory

Stock Markets are posting good gains on Nov 5, extending previous gains in the hope that newly elected US president Barack Obama will turn things around.

While US Indexes were up 3 to 4 % in anticipation of this news (ostensibly, as reported by mainstream media), the Asian Markets ranging from Japan to India opened higher by 1.5% to 5.75%.

The mainstream media reports this as a "reaction" to the news and hope from investors that year-end-rally in markets will take place. However, I think this is yet another Suckers' Rally which is more an example of irrational exuberance. My views regarding these kind of rallies can be found in detail in "Changing Trends In Markets".

Obama Wins US Presidency

Most Watched News on Nov 4 and 5 and...

Barack Obama was elected the 44th president of the United States of America, opening a new chapter in the country's history as the first African-American to hold the world's most important job.

The Illinois senator capped his 21-month quest with a sweeping electoral victory that also enhanced the Democrats' majority in Congress and marked the end of an era of Republican dominance in Washington.

My Views: For a change US will be ruled by "Democrats" for some time. People voted Obama so that he can "do" something to change US situation BUT I am sure he will not be (and for that matter anyone would be) able to solve the grave situation US is in.

The magic of Obama can't turn things around, things for which Democrats are equally responsible. It was the group of Democrats that had majority in senate and still they LET PASS BILLS AUTHORIZING INSANE CORRECTIONS IN SEC REGULATIONS (LIKE THE 1:30 FOR BIG 5 BANKS!!!).

Analyzing his past speeches, particularly during campaign, I realize only one thing - Obama doesn't know anything about economics at all, if he does, then at least he is not going to use that knowledge but do what politicians are good at - cheating taxpayers.

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