by Alex Evans | Mar 11, 2008 | Cooperation and coherence, Influence and networks
Who set out this admirable vision of decentralised policy coherence?
Without democracy, you have no understanding of what is happening down below; the situation will be unclear; you will be unable to collect sufficient opinion from all sides; there can be no communication between top and bottom; top-level organs of leadership will depend on one-sided and incorrect material to decide issues, thus you will find it difficult to avoid being subjective; it will be impossible to achieve unity of understanding and unity of action.
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by Jules Evans | Mar 11, 2008 | Global system
Dark times in western markets. The financial press at the moment reads like a particularly gloomy prophesy from the Middle Ages. This from Euroweek:
Undreamt of volatility in dollar swap spreads…Debt professionals watched in disbelief as dollar swap spreads shot out to their widest level in years. ‘Now the world is definitely coming to an end, right? It’s been nuts, just nuts’, said a stunned swaps dealer on Thursday in New York.
The surge in levels was so savage that some onlookers suggested it presaged the failure of a major US financial institution…Citigroup has taken a terrible beating through subprime, and its failure, or that of a big bank like it, is whispered as a possibility in the corridors of Wall Street.
The market was also upset by the news from Ambac, the troubled monoline bond insurer. It’s not getting a bailout from the banks after all, but intends to raise $1.5 bn of new capital in the stock market. If Ambac is downgraded, over $1 trillion of securities it has insured face a rating downgrade as well, which could spark a vast bond firesale and consequent losses for banks holding that paper.
Mortgage bonds are screwed too, as are hedge funds who own lots of mortgage bonds, including the Carlyle Group’s hedge fund, Carlyle Capital, which owned several billion dollars’ worth of mortgage bonds, and which now appears to be heading for default. And who is the biggest investor in Carlyle Capital? Citigroup.
Meanwhile, in other markets, things are looking fantastic. The IPO of China Railways managed to attract $68 billion in Chinese retail orders. $68 billion! The Middle East is also completely flush with cash. Russia is embarking on a $1 trillion infrastructure renovation programme.
And these investors are now buying up Wall Street bit by bit – Credit Suisse has sold a big stake in itself to Qatar’s sovereign wealth fund, while Citigroup is being propped up by other big Middle East investors at the moment.
This may not be enough to save it though. Even they think it might go down without US government support. This from Dow Jones last week:
Mideast sovereign wealth funds may fail to save troubled U.S. banking giant Citigroup unless more cash is pumped into the lender, the head of a $13 billion Dubai-owned investment firm said Tuesday.
Sameer Al Ansari, Chief Executive of Dubai International Capital told delegates at a private equity conference that it will take more than the combined efforts of the Abu Dhabi Investment Authority, the Kuwait Investment Authority and Saudi investor Prince Alwaleed bin Talal to save the bank.
“It’s going to take more than that to rescue Citi,” Ansari said. He added that more write downs are expected and that Gulf investors would be required to bolster Citi.
We’re seeing a major shift in the balance of power. Just 15 years ago, western financial institutions like the IMF, the US Treasury and Citigroup called the shots in emerging markets, and emerging market countries had to go to them on their best behaviour, like Oliver Twist saying ‘please sir, could I have some more!’.
Now, as one banker from the beleagured UBS told me today, ‘these developing countries don’t need us anymore’. No, I replied. They don’t need you…they own you.
by David Steven | Mar 10, 2008 | North America
Here comes ‘experience‘:
For all her years on the public stage, Mrs. Clinton has never come close to assembling and running an enterprise like the 700-person, $170 million-and-counting campaign organization that she has created. At times, her aides made assumptions about tactics and voters that turned out to be wrong. They nearly ran out of money at all the wrong times, like just after Mrs. Clinton’s victory in the New Hampshire primary and right before the 22 state nominating contests on Feb. 5.
The day after her loss in the Iowa caucuses, Mrs. Clinton took command of a long meeting in New Hampshire. “I’ll do whatever you guys need me to do,” she said, a participant recalled. “I get the message.”
But a month later, she described herself as stunned to learn the campaign was nearly broke — notwithstanding financial reports sent to her every week by e-mail — and was all but conceding the 11 contests that were to come over the next month.
Unlike Mr. Bush, Mrs. Clinton has shown no interest in having one strong person running all aspects of the campaign operation. And unlike her husband during the early part of his 1992 bid for the presidency, she does not try to keep a hand in everything, with lines of communications all through the campaign.
Instead, she talked daily to a few people: Mr. Penn, Ms. Solis Doyle and, now, Ms. Williams. Even Mr. Ickes, her longtime friend and adviser, says he speaks with her infrequently.
This approach, many of her associates said, had the effect of breeding resentment at campaign headquarters. Since there was no one person in charge, they said, it was hard to make decisions, and Mr. Penn would frequently use his personal connection with Mrs. Clinton to block the campaign from moving in directions he opposed, like putting an increased emphasis on trying to present a human side of Mrs. Clinton.
by Alex Evans | Mar 10, 2008 | Climate and resource scarcity
This morning’s Guardian has a leaked report from EU foreign policy chiefs Javier Solana and Benita Ferrero-Waldner, due to go to all 27 heads of government this weekend, warning of “significant potential conflicts” in the decades ahead as a result of “intensified competition over access to, and control over, energy resources”. Ian Traynor reports:
The officials single out the impact of the thawing Arctic and its emergence as a potential flashpoint of rival claims, pointing to the Kremlin’s grab for the Arctic last year when President Vladimir Putin hailed as heroes a team of scientists who planted a Russian flag on the Arctic seabed. Developments in the Arctic had “potential consequences for international stability and European security interests”.
“The rapid melting of the polar ice caps, in particular the Arctic, is opening up new waterways and international trade routes,” the report notes. “The increased accessibility of the enormous hydrocarbon resources in the Arctic region is changing the geostrategic dynamics of the region.”
Meanwhile, the FT is carrying a different angle on Arctic energy: consternation in Ottawa that the US Energy Security and Independence Act 2007 might prohibit the US from buying tar sands from Alberta. In a letter to Robert Gates, CCd to Condi Rice and Samuel Bodman (you’ve got to love the public affairs strategy – sent to the Defense Sec, copied to the Energy Sec), Canada raises concerns about section 526 of the law, which
…limits US government procurement of alternative fuels to those from which the lifecycle greenhouse gas emissions are equal to or less than those from conventional fuel from conventional petroleum sources. Canada’s oil sands are considered unconventional fuels, and producing them emits more greenhouse gas than conventional production.
So, er, how much more greenhouse gas does oil from tar sands emit? Well, the FT says, “environmentalists say extracting a barrel of crude from oil sands results in five times the amount of greenhouse gas emissions than extracting conventional crude” – though some energy companies dispute the figure.
by Richard Gowan | Mar 8, 2008 | Conflict and security, Middle East and North Africa
The McClatchy Company is the third biggest newspaper owner in the U.S., but most of the papers it owns tend to be of the smaller, less internationally-known variety. But it takes foreign reporting very seriously, especially from Iraq. Its “Inside Iraq” blog is a platform for the Iraqi journalists it employs to, well, blog. The posts are often on the mundane aspects of civil war life (“For the first time in more than three years I can call Fallujah from a land line in Baghdad. Yeeeeeeeeeeeeeeeeeah!”) and the writers have an impressive capacity for irony. Here’s the text of a post entitled, frankly, “Free Graves”:
In Iraq, journalists are always targeted by insurgents. The last sacrifice was the head of journalist union in Iraq who was assassinated in cold blood few days ago. Yet, no protections measures have taken by Iraqi government to stop this series.
I thought that the Iraqi government is watching this killing series with carelessness and they don’t do much to protect the life of journalists except for condemning and condolences which do nothing to save the precious lives of the Iraqi journalists but today I found out that I was wrong.
Today I read in the news that the governor of Najaf allocated a piece of land for journalist. Before finishing the news, I felt happy for one second only because I thought the man had allocated properties for the journalists to build their houses in the safe city of Najaf but again, I was wrong. The land which was allocated for the journalists by his Excellency the governor of Najaf was inside the biggest graveyard in the world (Dar Al Salam cemetery)… it is allocated to build graves for us after we get killed by the insurgents. This is serious and it’s not a joke.
Is not that great? They think about us even after our death.
