You are at: Home > News/Analysis, Page 3 ('08) | Previous | Next Posted: 6-10 Oct 08 Nothing Confucian about toxic milk in China: For a country with an enduring tradition of Confucian ethics, the poisoned milk scandal - possibly the worst crisis of its type in Chinese modern history - has had a devastating blow on the public's trust in its govt's benevolence, Inter Press Service, 10 Oct 08 Horizons: Iceland's financial authority takes over nation's largest bank--Officials of Iceland's largest bank Kaupthing decided late Wed night to hand over control to the Fin. Supervisory Authority. The bank's officials believe that the response of UK authorities regarding the frozen Icesave accounts of Landsbanki Bank & talk that Iceland authorities would not secure the deposits in these accounts were the deciding factor in the bank's fate, Iceland Review, 9 Oct 08 (CBank abandons fixing krona | Russia grants giant loan | OECD--June '08 [pdf] and Feb '08) US remains on top of competitiveness rankings: US tops the overall ranking in a global competitiveness report, with Switzerland in 2nd position followed by Denmark, Sweden and Singapore. European economies continue to prevail in the top 10 with Finland, Germany and the Netherlands following suit, World Econ Forum, 8 Oct 08 (Rankings) Boardroom: J Whitehead & P Malkin--What CEOs can learn from Paul Newman: History will certainly remember him as an icon of modern cinema. But he was far more than just an actor. While he was truly modest about his talents, he understood the power of his celebrity & capitalized on his fame to help fund important social pro- jects and address community needs, note Cmte Encouraging Corp Philanthropy co-chairs, Wall St J, 2 Oct 08 IMF predicts major global slowdown amid financial crisis: World growth will slow amid the most dangerous fin.shock since the 1930s, says latest half-yearly World Economic Outlook. There will be no growth in many advanced economies until at least mid-'09, and the world economy is expected to stage a modest recovery later in '09. Meanwhile, despite emerging markets' cooling momentum, they are still expected to provide a source of resilience. But the longer the cri- sis lasts, the more emerging markets' growth is likely to be affected, IMF Survey Mag, 8 Oct 08 Reform of banking regulation seen as urgent in the face of today's market strains: An intl body composed of central bank governors, economists and financial experts led by Paul Volcker released a new report providing insights into current challenges facing the global fin- ancial system and information to inform future banking regulation reforms The report was issued on the eve of the meeting of G7 fin mins and CB governors, Group of 30, 6 Oct 08 [pdf] (Structure of Financial Supervision, incl exec sum) Experts urge IMF to include developing nations in re-write of finan- cial rules: Experts are urging the IMF to push for the inclusion of developing nations in the re-write of bank supervision guidelines and other intl fin. rules that they say is likely to happen soon due to the global fin. crisis. An expert also voiced support for World Bank pres.'s call to replace the G7 with a new 14-member Steering Group that would include Brazil, China, India, Mexico, Russia, Saudi Ara- bia, and S Africa in addition to the current G7 members, Ctr Global Dev, 6 Oct 08 IMF warns about failure to act decisively on turmoil: Internationally coherent & decisive policy measures are required to restore confi- dence in the global financial system, says latest half-yearly Global Fin. Stability Report. The most serious risk going forward is an in- tensifying adverse feedback loop bet.the fin. system & the real econ- omy - in which fin. institutions' distress leads to impaired credit in- termediation and slower econ growth, which in turn leads to further credit deterioration, IMF Survey Mag, 7 Oct 08 (Interbank rates stay elevated despite CB actions | Emerging mkts pulled into crisis) Asian banks to face indirect impact of US financial turmoil: The ratings agency said the direct exposures of rated banks in Asia (exc Japan) to Lehman Brothers are not expected to be significant enough to materially damage their credit profiles, Standard & Poor's, 18 Sep 08 (Report--Slower econ growth poses turbulence but no crisis for Asian banking systems [pdf]) Banks, markets seek political lead in crisis: Investors looked to cen- tral banks & politicians to show they could contain an escalating fin- ancial crisis after Australia cut interest rates sharply. EU fin. minis- ters meet in Luxembourg today to try to flesh out promises to coun- ter market mayhem. And the deepening freeze in credit markets has made this week's G7 meeting even more important, Reuters (cour- tesy Kyiv Post/Ukraine), 7 Oct 08 (US calls for united front as crisis wrecks markets) D Gros & S Micossi: Two steps the EU should take to protect Eu- rope's financial system--Europe's largest banks are highly leveraged and thus vulnerable. But some of these banks are both too large to fail and too big to be rescued by a single govt, note Ctr Eur Pol Stud dir and biz assn Assonime dir-gen, VoxEU, 30 Sep 08 Can money buy democracy?: 'Look around the world. Every rich country is also a democracy. So if we try to promote economic development, is that equivalent to trying to spread democracy?,' Columbia U, 23 Jul 08 Banks brace for more turmoil as Europe scrambles for rescue plans: Germany on Sun made a blanket guarantee to cover all the country's bank savings, piling pressure on other European govts to bolster de- fenses ahead of predicted mayhem on global markets.Ireland guaran- teed bank deposits last week, while Austria said it will decide soon whether to follow suit and the UK govt now faces pressure to under- write all savings, Ag. France-Presse (courtesy ChNewsAsia/Spore), 6 Oct 08; and What deposit insurance can and cannot do: A deposit insurance sys- tem can contribute to financial stability, but only if it is adequately funded and if other safeguards - such as a strong bank supervision program - are also in place, by R Helfer, Finance & Development, Mar-May '99 (Letter to ed-scroll | Garcia--Protecting bank deposits) Economic Freedom of the World: The annual report uses 42 differ- ent measures to create an index ranking 141 nations based on poli- cies that encourage economic freedom.This year, Hong Kong retains the highest rating, followed by Singapore,New Zealand, Switzerland, UK and Chile, Fraser Inst/Canada, 16 Sep 08 Posted: 29 Sep-3 Oct 08 Coffee/tea break: McCain contracts shed 10% of value in weekend trading--On Mon, the price of a McCain contract on the IEM's Win- ner Take All market was 32.7 cents. That means traders on the pol- itical prediction futures market believe McCain has a 32.7% chance of winning the popular vote in Nov. Meanwhile, the price of a con- tract for Obama was selling for 67 cents, Univ Iowa Electronic Mar- kets, 29 Sep 08 (About | Current mkt prices) Barry Eichengreen: Lessons from the Great Depression--The Paul- son plan, whatever its final form, will not bring this upheaval to an early end. The consequences are clearly spreading from Wall St to Main St. So comparisons with the Great Depression, which have been of academic interest but little practical relevance, take on new salience. Which ones have content, and which are mainly useful for headline writers?, asks UC Berkeley economic historian, VoxEU, 28 Sep 08 Edwin Truman: Each crisis is different and all crises are the same--It may have been a mistake for Paulson to ask Congress for another almost blank check. It may have been a mistake for Bernanke to support the Paulson plan. But at this point, the alternative of doing nothing, or debating whether there is a better way, more than likely will increase the economic costs to the US and the financial costs to the taxpayer. That is the lesson of history, says senior fellow, Peter- son Inst, 26 Sep 08 The bailout--An owner's manual: The Senate's passage Wed night of a modified version puts pressure on the House to approve it. Whether that happens is another story. A vote is most likely Friday, but many House Democrats don't like the new version of the bill because it contains some expensive add-ons. Lawmakers still have many questions about the bill under consideration, Forbes, 2 Oct 08 A Alesina, R Baldwin & economists in Europe: Open letter to Euro- pean leaders on Europe's banking crisis--A call to action: This is a once-in-a-lifetime crisis. Trust among financial institutions is disap- pearing; fear may spread. Last week's US experience showed that saving one bank at a time won�t work.A systemic response is needed & in Europe this means an EU-led initiative to recapitalize the bank- ing sector, courtesy VoxEU, 1 Oct 08 Computers or classrooms?: Ever since fears erupted about a decade ago that the world could be divided into digital haves and have-nots, policymakers have correctly assumed that this digital divide needs to be bridged. The most obvious 1st step was to give poor children ac- cess to computers. Some even dream of an education system where the teacher is replaced by a computer programme. Does this plug-and-study idea really work?, Livemint/India, 22 Jul 08 Federal Reserve caused Great Depression - Bernanke: 'Let me end my talk by abusing slightly my status as an official representative of the Fed. I would like to say to Milton Friedman and Anna Schwartz: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again,' WorldNetDaily, 19 Mar 08 (PBS: '98--Great Depression | 2000--Friedman Q&A, and 2nd Q&A [scroll to Q: What happened during the Depression?]) Donors and developing countries agree to reform aid: After 3 days of intense negotiations, developed and developing nations agreed to take bold steps to reform the way aid is given and spent. Among the key points agreed are predictability (donors will provide 3-5 year for- ward info on their planned aid to partner nations) & country systems (partner nation systems will be used as the 1st option to deliver aid, rather than donor systems), OECD, 4 Sep 08 Diana Farrell: New thinking for a new financial order--In order to develop appropriate new rules for the current era, we must begin to think differently about the rapidly evolving financial world, focusing on 3 key dimensions: activity on a global scale, new private & public actors, & fin. activity taking place outside traditional publicly traded & regulated markets, says McKinsey Global Inst dir, Harvard Bus. Rev, Sep '08 US Senate to vote on Bush financial bailout plan: In an unexpected move to revive the $700bn rescue plan, Senate leaders decided to vote on Wed on a new version, which includes a tax cut plan already rejected by the House. In the meantime, world leaders warned the US that it is responsible before the entire world and must deal with the financial crisis, News agencies (courtesy Novinite/Bulgaria), 1 Oct 08 US bailout failure hits European shares: European share indexes have been volatile in morning trading after a US financial rescue plan failed to gain congressional backing. Asian stocks have already seen big declines in Tuesday trading. Congress will not meet again until Thu - after a break for the Jewish New Year - with another vote un- likely before the weekend, BBC News, 30 Sep 08 Bailout bill and Treasury--Broad authority, lots of money and uncer- tainty: Congress is on the verge of granting Secy Paulson sweeping powers to stabilize US financial system, as 2 European banks moved toward failure over the weekend - Bradford & Bingley, a UK mort- gage lender, and Fortis, a giant banking/insurance co. based in Bel- gium. The bill allows Treasury to spend $700 bln buying up mort- gage-related securities devalued by foreclosures in hopes of leaving troubled fin. institutions with fewer problems and more cash, Wash. Post (free registr reqd), 29 Sep 08 No recession forecast for the otherwise stalled US economy: In its 3rd quarterly report, the UCLA Anderson Forecast does not forecast a recession but readily acknowledges that the economy is 'stalled'. It expects real GDP growth to be about 1% in the current quarter and zero in both the next quarter & the 1st quarter of '09 - an economy operating at its 'stall speed' where any modest shock can trigger a full-blown recession, 24 Sep 08 (UCLA conf | IMF No.2 at conf) Climbing the quality ladder to compete in the global marketplace: Firms in developed nations can compete with those in emerging mar- kets by specializing at the high end of the quality scale. The problem for a developed-nation firm producing footwear/apparel is that there is nowhere to go. 'You hit the top rung of the ladder & China is right next to you. You've run out of space,' Columbia U, 17 Jan 08 Posted: 22-26 Sep 08 JPMorgan buys Washington Mutual deposits; Regulators seize thrift: JPMorgan Chase & Co. became the biggest US bank by deposits, acquiring WaMu's branch network for $1.9 bln after the thrift was seized in the largest bank failure in US history. The thrift is the latest casualty of the financial crisis, Bloomberg, 26 Sep 08 Leaders gathering at New Champions meet are optimistic about growth: The meeting will focus on the response of the new genera- tion of fast-emerging multinational cos. to the current economic chal- lenges and future opportunities, World Economic Forum, 26 Sep 08 (Peterson Inst: Trillion dollar club--'BRICKs') Joseph Stiglitz: The fruit of hypocrisy--Houses of cards, chickens coming home to roost - pick your cliche. The new low in the finan- cial crisis, which has prompted comparisons with the 1929 Wall St crash, is the fruit of a pattern of dishonesty on the part of fin. institu- tions, and incompetence on the part of policymakers, says Nobel laureate, Guardian, 16 Sep 08 50 countries still hurt by food, fuel crisis: Amid turmoil in financial markets, the 'other crisis' should not be obscured. Although food and fuel prices have eased from recent peaks, some 50 low & middle in- come nations will remain at risk through '09. For Africa, progress toward the Millennium Development Goals has been thrown further off course, IMF Survey Mag, 24 Sep 08 (High-level UN event on Millen. Dev. Goals at the halfway point towards target date) An open letter by economists to the House Speaker and Senate Pres: 'As economists, we want to express our great concern for the plan proposed by Treas Secy Paulson to deal with the financial crisis. We see three fatal pitfalls in the plan regarding its fairness, ambiguity and long-term effects,' courtesy U Chicago, 24 Sep 08 Persistently high corruption in low-income nations amounts to an 'ongoing humanitarian disaster': The Corruption Perceptions Index '08 highlights the fatal link bet. poverty, failed institutions and graft. It scores 180 nations on a scale from 0 (highly corrupt) to 10 (highly clean). Denmark, New Zealand and Sweden share the highest score, followed by Singapore. Bringing up the rear is Somalia, trailing Iraq, Myanmar and Haiti, Transparency Intl, 23 Sep 08 (incl rankings) Peter Timmer: Poor people will get hurt & confidence in the market will fall--The 'market' now has a bad name, as it did after the Great Depression. Last time this happened, poor nations opted for state planning and an over-reliance on poorly designed and implemented regulations which resulted in several decades of poor economic man- agement & low growth, says Stanford visiting prof, Ctr Global Dev, 22 Sep 08 (Development impacts of financial crisis) Stephen Roach: Anatomy of a meltdown--It didn't have to be this way. America went too far in its borrowing and spending sprees, and the rest of an export-dependent world was more than happy to go along for the ride. Now that it is over, can an interdependent world learn the tough lessons of the current upheaval?, asks Morgan Stan- ley Asia chair, Time, 19 Sep 08 Charles Wyplosz: Why Paulson is right (maybe)--Saving the finan- cial system from the bankers: The world's bankers created a reckless mix of lending & securitization that exploded in their faces last year; they've stonewalled since. It would be criminal to bail them out, but spilling blood for its own sake is foolish. The 'Paulson package', his- tory's largest bet, might work & might not cost taxpayers too much. It's too early to know which label to apply: bailout or shrewd cleans- ing operation, says Geneva Grad Inst economist, VoxEU, 22 Sep 08 Luigi Zingales: Why Paulson is wrong--Saving capitalism from the capitalists: There is an alternative to bailing out the financial system with taxpayers' money, ie, forced debt-for-equity swap or debt-for- giveness. Forcing this alternative would be no greater a violation of private property rights than a bailout, but it faces much stronger pol- itical opposition. It is much more appealing for the financial industry to be bailed out than to bear their share of pain, argues U Chicago economist, VoxEU, 21 Sep 08 Edward Miguel: Is it Africa's turn?-The debate on what went wrong in Africa at the end of the 20th century is extensive, but the leading culprits seem to be bad economic policy and weak state institutions. Since 2000, the turnaround in econ performance that has lifted growth rates to historic highs & democratization appears finally to be taking root. Will Africa be the world's next development miracle?, asks UC Berkeley economist, Boston Review, May/Jun '08 (High-level UN meeting on Africa's development needs) World stocks rise on proposed US bailout: Global markets rose on Mon after a rough outline of a US govt plan took shape over the weekend - a $700 bln plan to solve the financial crisis by rescuing banks from billions of risky mortgage debt at the heart of the crisis, AP, 22 Sep 08 (Sat--Russian markets surge on rebound) [courtesy Hindu Times & Taiwan News] Harold James: The geopolitical consequences of the financial crisis--Worried investors are becoming obsessed with Great Depression analogies. But the lesson of 1931 is only in part financial or econo- mic. The 1931 crisis was so big and so destructive because it was a financial drama that played out on a geopolitical stage, says Prince- ton econ historian, Proj Syndicate (courtesy Daily News/Egypt), 18 Sep 08 Posted: 15-19 Sep 08 J Sachs & G McCord: Extreme poverty--Households living in ex- treme poverty face deprivations that cost millions of lives yearly. Ending extreme poverty requires an understanding of poverty traps, incl the effects of adverse biophysical & geographical factors, a lack of resources required for the investments needed to escape poverty, & poor governance, say Earth Inst dtr & fellow, New Palgrave Dict. of Econ (courtesy Columbia U), 12 May 08 [pdf] Vincent Reinhart: US Treas Secy Paulson's double-dog dare--This past weekend, Paulson made it clear that, given limited govt re- sources, aid would not be extended automatically to financial institu- tions in distress. But the line in the sand that Treasury drew was ob- scured within a few days. The limits of the safety net underneath fin. firms are once again indistinct, says fmr Fed dtr, American Mag, 18 Sep 08; and Roger Altman: Modern history's greatest regulatory failure--There were no precedents for judging whether the biggest insurance co. could be allowed to fail or whether a domino effect would follow. Ultimately, the Fed saw too much systemic risk, reversed course and intervened in AIG, says fmr deputy Treas secy, FT, 17 Sep 08 Central banks turn on funding taps: The world's top central banks said they will pump more than $180 bln into global money markets in a coordinated effort to ease a funding squeeze triggered by the upheaval on Wall St. After the announcement, stocks in Europe turned higher, at least temporarily halting a global equity selloff, after Asian stocks have closed down, Reuters (courtesy Report on Biz/ Canada), 18 Sep 08 An antidote to breaking news: In this era of immediacy, with its 24-hour news outlets, there is an old-fashioned charm in taking a step back, methodically uncovering the long-emergent patterns & project- ing where they might lead us well beyond the next few news cycles. The 11 'issues over the horizon' identify current trends as harbingers of upcoming events, bringing to light several simmering but over- looked challenges, Rand Review, Jun-Aug '08 US and UK defy crisis to top Financial Development Index: US nar- rowly edged the UK to take the top position in the Index, a survey of financial systems and capital markets in 52 nations that analyzes key drivers of financial system development and economic growth in developing & developed nations, World Economic Forum, 9 Sep 08 (Financial Development Report '08) N Bloom & R Homkes: Can better management sustain growth in China & India?--The 2 economies have been booming - but do they have the quality of corporate management to sustain growth over the longer term? Using a new global survey of more than 4,000 firms, 2 research fellows from Stanford and LSE evaluate mgmt practices in their manufacturing sectors, Stanford U, Jun '08 Financial crisis weighs on global economy: The speed and scale of recent financial market events have added to short-term uncertain- ties. But falling oil prices provide some cushion to downside impact, IMF Survey Mag, 17 Sep 08 Asian stocks lose steam after cheering AIG rescue: Asian markets opened to learn that the US Fed would extend an $85 bln loan to in- surance giant AIG. The markets gained on early trade, making up for Tue's dramatic selloff. But the rally failed to keep momentum & some bourses turned lower amid lingering worries over the health of US fin. institutions, Ag. France-Presse (courtesy Citizen/S Africa), 17 Sep 08 (IMF on the current financial events) Lehman declares bankruptcy; Bank of America buys Merrill Lynch: The demise of the independent Wall St institutions come as shock waves from the 14-mo.-old credit crisis roiled the US financial sys- tem 6 mos. after the collapse of Bear Stearns. Analysts say that in- vestment banks need the deep pockets of commercial banks to sur- vive, AP(courtesy Japan Today), 15 Sep 08 (NPR Q&A--Lehman's search for a buyer | The rise & demise of Wall St firms) Doing Business '09--Five years of reforms: More regulatory reforms were recorded worldwide from June '07-June '08 than in any previ- ous year, according to new report. For the 5th year in a row, E Eur- ope and Cent. Asia led the world in reforms. Once again, Singapore tops the rankings, followed by New Zealand, US and Hong Kong, Intl Finance Corp, 10 Sep 08 (Overview [pdf] | Rankings) The rise of Africa's "frontier" markets: A number of sub-Saharan countries are beginning to attract investors to their financial markets, by D Nellor, Finance & Development, Sep '08 << Previous Home Next >> Copyright (c) 2001-2009 Leonardo L. Sta. Romana All rights reserved. |
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