14 Nov, 2008, 0000 hrs IST, AGENCIES
LONDON/TOKYO: Germany has fallen into recession and China’s industry output growth waned to its weakest in seven years, data showed on Thursday, reinforcing evidence the financial crisis is plunging the world into a painful downturn.
Seeking to limit the fallout from a crisis that began when the US housing market collapsed more than a year ago, Japan said it would offer up to $100 billion to the International Monetary Fund (IMF) for emerging economies.The impact of the worst financial conditions in 80 years was felt sharply in Germany, Europe’s largest economy, where the economy contracted by 0.5% in the third quarter, putting it in recession for the first time in five years.The decline — much sharper than the 0.2% forecast — was accentuated by German export growth grinding to a halt.“We are going to have to face up to a very difficult and long-lasting economic crisis,” Germany’s deputy economy minister Walther Otremba told Reuters.
Analysts agreed with that grim forecast. “The headwinds of the financial crisis and the global economic slowdown are blowing right in the face of the German economy,” said Carsten Brzeski of ING Financial Markets.“Even more worrying, the full impact of the financial crisis still has to unfold,” he said. “If you think today’s (Thursday’s) numbers are already bad, just wait for the next quarter.”
In China, which has unveiled a 4 trillion yuan ($586 billion) stimulus package, annual industrial output growth slowed to 8.2% in October, its weakest showing since October 2001, as the global downturn took its toll.
Stock markets tumbled again in Asia. Tokyo shares slid 5.3% and the price of oil hit a 22-month low at $55 a barrel on worries that a recession will curb demand. China was a rare bright spot, shares ending up 3.7% on hopes that the stimulus package would include big spending on housing and railway construction. Shares in Europe edged higher, breaking a two-day losing run.
Governments around the world have pledged around $4.6 trillion for bank bailouts, credit guarantees and fiscal spending to contain the damage from the financial turmoil. Leaders of the G20 industrialised and emerging nations will gather in Washington on Friday to decide on the next steps in tackling the crisis. Japan is prepared to offer foreign reserves worth up to $100 billion to the IMF if the Washington-based lender needs extra funds to help emerging economies, a government source said on Thursday. Prime Minister Taro Aso will make the proposal at the G20 summit, the source told Reuters.
“Investors are now looking to the G20 Summit this weekend, with hopes of some further policy action,” Patrick Bennett, Asia FX and rates strategist at Societe Generale, wrote in a note.However, the summit falls at an awkward time politically as US President George W Bush prepares to leave office. Bush will travel to Wall Street on Thursday to outline his views on the financial markets. “We should fix the problems we have rather than dismantle a system that has improved the lives of hundreds of millions of people around the world,” White House spokesman Carlton Carroll said in previewing Bush’s remarks.Some leaders have called for big reforms to the financial system, but the Bush administration has been more cautious.
The president will “emphasise that free market capitalism — especially free trade — is still the best system to create economic growth and lift people out of poverty,” Carroll said.Washington has backed away from using a $700 billion bailout fund to cleanse bank balance sheets of bad mortgage debt. US Treasury Secretary Henry Paulson said he preferred instead to focus on buying stakes in banks to encourage them to increase lending.Banks in Asia will suffer from rising bad loans next year or until 2010, a senior official at Fitch Ratings said.“Dealing with economic downturn will increase bad loans that will challenge banks,” David Marshall, managing director and head of Fitch’s Asia-Pacific financial institutions team, said in an interview.
Underlying his argument, Mizuho Financial Group, Japan’s second-biggest bank, said it planned to raise fresh capital reportedly worth $3.2 billion.Commonwealth Bank of Australia warned investors to expect a big jump in bad debts and voiced concerns over the economic outlook for at least the next 18 months. “Dealing with economic downturn will increase bad loans that will challenge banks,” David Marshall, managing director and head of Fitch’s Asia-Pacific financial institutions team, said in an interview.
Saturday, November 15, 2008
Friday, November 14, 2008
Obama Indian aide's VHP links spark debate
Thursday, November 13, 2008, (Ahmedabad, New Delhi)
The accusations against Shah first came up in a post by Vijay Prashad, the chair of South Asia history at Trinity College in Connecticut. Those defending Sonal Shah on blogs are now ripping into Prashad's piece.
"The Gujarat Garima award Sonal received for her work with her NGO, IndiCorps, in 2004, upsets Prashad because Narendra Modi was present there. The Gujarat Garima awards were organized by the US-based weekly Gujarat Times. They were presented by the then Prime Minister of India. Those who received the same award, in the same year, and in person were Ratan Tata, Mukesh Ambani, and economist Dr Jagdish Bhagwati.
So now Tata, Ambani, Bhagwati and others are responsible for, or at least complicit in, anti-Muslim violence in Gujarat? Nice try, " said a blog.
But other bloggers are demanding that Obama should drop Shah from his team.
"The spin doctors for Ms. Sonal Shah are now saying that she was a member of the VHP and her membership has expired. This is like saying that she was a Nazi and now her membership has expired," says a blogger.
Shah herself has dismissed the accusations against her as silly, and says her work during the Gujarat quake of 2001 was humanitarian.
British Telecom to cut 10,000 jobs, India untouched
London: UK-based telecom major British Telecom Group (BTG) on Thursday announced plans to cut 10,000 jobs at home and overseas, but said this would not affect the Indian operations of the company.
"The Indian operations would not see any retrenchment. The majority of the job cuts are UK based. It is too early to know country specific job cuts", a company spokesperson said.
British Telecom has 600 employees in India.
Commenting on the second quarter's results, BTG chief executive Ian Livingston said, "Three out of our four business units, BT Retail, BT Wholesale and Openreach, are delivering on or ahead of target. But profits in BT Global Services are simply not good enough and we are taking decisive action to put matters right."
The company added that 4,000 employees have already been given pink slips. Less than half of the jobs to go are direct positions.
Chennai college campus turns battlefield, cops watch
Chennai: The Chennai police commissioner has been transferred and the principal of the Chennai law college suspended after students of the college beat up their fellow students in what seems to be a caste row.
The shocking incident was caught on tape.
Tension has been brewing for the last few days between Dalit students and students belonging to the Thevar caste.
On Wednesday, when the clash broke out, an examination was in progress and shockingly, the police just stood and watched even as one student, Arumugam, was beaten by a group of 15 men armed with sticks and iron rods.
The attack has now left Arumugam in a critical condition. He's battling for life at a Chennai hospital.
Desperate to save face the state government has now taken action against seven policemen.
But this is not the first time an incident like this has been reported from this college. Students here have strong political links and have often resorted to violence and unlawful means to settle their disputes.
Thursday, November 13, 2008
Hayden calls India a third world country
Australia opener Matthew Hayden on Wednesday termed India as a "third world" country following their humiliating 0-2 loss in the Test series.
Hayden came out strongly in support of captain Ricky Ponting, who surprisingly preferred surrendering the fourth Test in Nagpur to avoid suspension for a slow over rate.
"Often we find ourselves waiting with hands on hips for someone to face up or someone on the sight board to move away or some of those little frustrations happening with third world countries," Hayden was quoted as saying by Australian newspaper The Daily Telegraph.
Hayden believes that Ponting can come out of his Indian misadventure stronger and rebuild another champion Australian team in the near future.
"Ricky's an absolute bloody champion and he has won right across the globe in his reign in his captaincy. I completely endorse where he is at as an individual and a captain. To me, the next six months will show you how he can rebuild another Australia side which has lost a lot of its brand champions to become a very formidable opponent," Hayden said.
BBC presenter sacked for making racial remarks
London: BBC is back in a racist row and this time over the racist comments made by its radio presenter off-air.
Sam Mason, 40, who joined BBC Radio Bristol in September this year lost her job after she allegedly told a cab operator not to send a driver with a turban for her 14-year-old daughter as it would "freak her out".
The taxi worker however refused and provided a recording of the conversation to the media.
Sam allegedly told the cab operator "not to send an Asian driver to pick up her daughter. A guy with a turban on is going to freak her out".
"I know this sounds really racist, but I'm not being please. An English person would be great, a female would be better," she further added.
Sam was suspended and sacked 24 hours later after the operator passed a transcript of the conversation to The Sun newspaper. She was later informed by station officials on Saturday that she would no longer work for the BBC.
The transcript records how she ordered a taxi to take her 14-year-old from her Clifton house to her grandparents' home.
"Although Sam Mason's remarks were not made on-air, her comments were completely unacceptable and, for that reason, she has been informed that she will no longer be working for the BBC with immediate effect,” a BBC spokesperson said.
(With inputs from PTI)
Yellow card: Cricket goes the football way
London: Cricket is all set to go the football way with the introduction of yellow cards to prevent players from abusing umpires and excessive sledging.
The rule will be put on trial in minor county and club level tournaments in London first. If the trial is successful then the English and Wales Cricket Board (ECB) will soon introduce it in first class matches as well.
ECB chairman Giles Clarke will discuss this innovation with Marylebone Cricket Club (MCC), which controls and oversees the laws of the game.
"Jack Simmons and Mike Griffith, the chairmen of the ECB and MCC cricket committees, are very concerned and, if the trials work, would want this as part of the first-class game, although much cricket at that level is self-policed," Clarke was quoted as saying by The Times.
"A rugby player is sent off the field for ten minutes, one eighth of the game, and a cricketer could go off for 12 overs. Abuse of the umpire and sledging have to be stopped."
Clarke's views were also supported by former English cricketer Dennis Amiss, the most influential person on the ECB, and MCC chairman Charles Fry.
"I would not be against introducing yellow cards in first-class cricket," Amiss said. "When I was a player, I had confidence in English umpires as they were former professional cricketers, but the Australians were always inclined to sledge. I would listen to the players' view and it would have to be a bad misdemeanour but we have to move the game forward. Red cards? I hope not, but it would all add to the drama of a match."
Fry felt that some kind of punishment could even be incorporated in the laws.
"My personal view is that the behaviour in the international game is very good but in league cricket it is absolutely awful. We would always be keen on anything to improve. At the moment there are no penalties," he said.
Party’s over for the analyst community
12 Nov, 2008, 0150 hrs IST,Prashant Mahesh, ET Bureau
MUMBAI: When the Sensex moved from a level of 3,000 in April 2003 to a dizzy 21,000 earlier this year, it was an unbelievable good time for anyon
e involved with the markets. One such benefactor was the analyst community. That was then.
Today’s scenario with the Sensex being at around half the level down from that peak has left a lot of people in a quandary. The analyst community has been one such affected party. Five years ago, an equity analyst needed an MBA and a good reference. That was good enough for a job at a domestic broking house.
Typically, an analyst would spend a year before another broking house would grab him at an impressive hike — often twice as much. If things went to plan, in three years, the analyst would find himself inundated with offers from foreign broking outfits at mind-boggling salaries. Clearly, the journey to 21,000 fuelled a lot of ambitions and the mismatch between demand and supply was working overtime.
Meanwhile, broking outfits wanted research analysts to recommend stocks to their clients. This in turn would generate brokerage income for them. It was the large research team that owners of broking outfits would use as the selling point to prospective private equity investors. The effort seemed worthwhile for the analysts since the money was coming in.
Typically, an analyst with an experience of three years would command an annual salary of Rs 10 lakh and one with around twice that experience would draw as much as Rs 15-20 lakh. This was as far as domestic broking firms were concerned. If one was to head to a foreign firm, the salary would be twice as much as what was being made at the domestic broking firm.
That story is hugely different today. “Many analysts came back to their own company after six months at double the salary,” says an industry observer a little wryly.
With cost cutting now the buzzword, broking outfits are looking closely at equity research which is a huge cost centre. Today, with some sectors such as real estate being under intense stress and even mid-caps going off the radar, research analysts in those segments will lose favour.
There is a school of thought which looks at analysts a little sceptically. “Most of them form an opinion after meeting the company management. Very few of them bother to talk to clients or rivals of the company,” says a fund manager with a domestic fund house. That’s not the end of the story. “Not many analysts have seen multiple bull and bear cycles,” says Churiwala Securities managing director Alok Churiwala. With the demand-supply scene easing off now, it may be possible to obtain some quality analysts.
A broker looks at the weakness a little differently. “Not many were able to identify a stock in advance,” says a broker. He says the idea comes from the superior in the office which was followed by some number crunching. Some of them made fancy presentations to fund managers to generate business for the fund house. There are many such instances.
A leading foreign broking house in April upgraded its target price for Suzlon from Rs 290 to Rs 380. Another foreign outfit in early March had a target of Rs 450 on the stock. The stock currently trades at Rs 65. There are similar stories for a lot of other mid-cap companies. Industry watchers, say analysts, often have no explanation in such cases.
The downturn in the market has separated the wheat from the chaff. Broking houses that are serious about the business would try and retain its people and also get an opportunity to choose from a large pool. It does look like there will be semblance that will come in sooner than later.
MUMBAI: When the Sensex moved from a level of 3,000 in April 2003 to a dizzy 21,000 earlier this year, it was an unbelievable good time for anyon
e involved with the markets. One such benefactor was the analyst community. That was then.
Today’s scenario with the Sensex being at around half the level down from that peak has left a lot of people in a quandary. The analyst community has been one such affected party. Five years ago, an equity analyst needed an MBA and a good reference. That was good enough for a job at a domestic broking house.
Typically, an analyst would spend a year before another broking house would grab him at an impressive hike — often twice as much. If things went to plan, in three years, the analyst would find himself inundated with offers from foreign broking outfits at mind-boggling salaries. Clearly, the journey to 21,000 fuelled a lot of ambitions and the mismatch between demand and supply was working overtime.
Meanwhile, broking outfits wanted research analysts to recommend stocks to their clients. This in turn would generate brokerage income for them. It was the large research team that owners of broking outfits would use as the selling point to prospective private equity investors. The effort seemed worthwhile for the analysts since the money was coming in.
Typically, an analyst with an experience of three years would command an annual salary of Rs 10 lakh and one with around twice that experience would draw as much as Rs 15-20 lakh. This was as far as domestic broking firms were concerned. If one was to head to a foreign firm, the salary would be twice as much as what was being made at the domestic broking firm.
That story is hugely different today. “Many analysts came back to their own company after six months at double the salary,” says an industry observer a little wryly.
With cost cutting now the buzzword, broking outfits are looking closely at equity research which is a huge cost centre. Today, with some sectors such as real estate being under intense stress and even mid-caps going off the radar, research analysts in those segments will lose favour.
There is a school of thought which looks at analysts a little sceptically. “Most of them form an opinion after meeting the company management. Very few of them bother to talk to clients or rivals of the company,” says a fund manager with a domestic fund house. That’s not the end of the story. “Not many analysts have seen multiple bull and bear cycles,” says Churiwala Securities managing director Alok Churiwala. With the demand-supply scene easing off now, it may be possible to obtain some quality analysts.
A broker looks at the weakness a little differently. “Not many were able to identify a stock in advance,” says a broker. He says the idea comes from the superior in the office which was followed by some number crunching. Some of them made fancy presentations to fund managers to generate business for the fund house. There are many such instances.
A leading foreign broking house in April upgraded its target price for Suzlon from Rs 290 to Rs 380. Another foreign outfit in early March had a target of Rs 450 on the stock. The stock currently trades at Rs 65. There are similar stories for a lot of other mid-cap companies. Industry watchers, say analysts, often have no explanation in such cases.
The downturn in the market has separated the wheat from the chaff. Broking houses that are serious about the business would try and retain its people and also get an opportunity to choose from a large pool. It does look like there will be semblance that will come in sooner than later.
You Must Remember This: Forgetting Has Its Benefits
There's an old saying that inside every 70-year-old is a 35-year-old wondering, "What happened?"
What happened is that countless days, nights, meetings, commutes and other unremarkable events went by, well, unremarked. They didn't make a lasting impression on the brain or they were overwritten by so many similar experiences that they are hard to retrieve. In short, they've been forgotten.
That's not necessarily a bad thing. Neuroscientists say forgetting is crucial to the efficient functioning of the mind, to learning, adapting and recalling more significant things.
"We focus so much on memory that forgetting has been maligned," says Gayatri Devi, a neuro-psychiatrist and memory expert in New York City. "But if you didn't forget, you'd recall all kinds of extraneous information from your life that would drown you in a sea of inefficiency."
That was what prompted Jill Price to contact the memory experts at the University of California at Irvine in 2000. As she wrote in a book published this summer, "The Woman Who Can't Forget," Ms. Price could recall in detail virtually every day since she was 14, but she was mentally exhausted and tormented by her memories. UC Irvine scientists are interviewing more than 200 people who say they have similar "autobiographical" memories, but so far have found only three more.
Memories of singular, significant events -- say, last week's historic election -- are generally easy to recall; people typically store them in long-term memory with many associations attached.
Memories of mundane, recurring events compete to be recalled, and scientists say the brain appears to be programmed to forget those that aren't important. Neuroimaging studies show that it's the brain's prefrontal cortex, the area of complex thought and executive planning, that sorts and retrieves such "like-kind" memories. Researchers at Stanford University's Memory Laboratory demonstrated last year that the more subjects forgot competing memories, the less work their cortexes had to do to recall a specific one. In short, forgetting frees up brain power for other tasks, says psychologist Anthony Wagner, the lab's director.
A real-world example, he says, is having to learn a new computer password every few months: As your brain suppresses the memory of the old password, it gets easier to summon the new one.
In fact, forgetting is a very active process, albeit subconscious, neuroscientists say. The mind is constantly evaluating, editing and sorting information, all at lightning speed. "Your brain is only taking a small amount in, and it's already erasing vast amounts that won't be needed again," Dr. Devi says.
Much that happens during the day doesn't make an impression at all because our attention is focused elsewhere. Take your daily commute, says Dr. Wagner: "A heck of a lot of stuff is landing on our retinas as we're driving down the road. But if you were focusing on the presentation you have to give, you didn't perceive it and it didn't get stored."
He notes that people face such a constant cognitive barrage that they frequently fail to attend to information that isn't essential at the time. "I have two 4½-year-olds and I'm already thinking, where did those first four years go?" Dr. Wagner says.
Numerous studies have shown that when people are asked to focus on one thing, they can fail to notice others— phenomenon called "change blindness." In one famous test, when viewers are asked to count how many times a basketball changes hands in a video, roughly half don't notice that a gorilla walks through the scene.
Conversely, people who have remarkable memories for, say, sports statistics or who-wore-what to parties paid attention at the time and attached significance to it, while it doesn't register on other people's radar screens at all.
Are memories for events you didn't focus on stored in your brain nevertheless -- like unwatched bank-surveillance tapes? That's an area of much debate. Some experts believe hypnosis can trigger long-buried associations. But so-called recovered memories are also susceptible to distortion.
"Memory consists of billions of puzzle pieces, and many of them look the same," Dr. Devi says. "Each time you retrieve a memory, you're reconstructing a puzzle very quickly and breaking it down again. Some of the pieces get put back in different places."
What if you want to remember more about each passing day? One simple method is to keep a journal. Writing down a few thoughts and events every day not only makes a tangible record, it also requires you to reflect. "You're elaborating on why they were meaningful, and you're laying down an additional memory trace," says neuroscientist James McGaugh at UC Irvine. Taking photographs and labeling them reinforce memories too.
But remember that forgetting can be very useful, says Dr. McGaugh: "If you used to go out with Bob and now you're married to Bill, you want to be able to say, 'I love you, Bill.' That's why forgetting is important."
Write to Melinda Beck at HealthJournal@wsj.com
What happened is that countless days, nights, meetings, commutes and other unremarkable events went by, well, unremarked. They didn't make a lasting impression on the brain or they were overwritten by so many similar experiences that they are hard to retrieve. In short, they've been forgotten.
That's not necessarily a bad thing. Neuroscientists say forgetting is crucial to the efficient functioning of the mind, to learning, adapting and recalling more significant things.
"We focus so much on memory that forgetting has been maligned," says Gayatri Devi, a neuro-psychiatrist and memory expert in New York City. "But if you didn't forget, you'd recall all kinds of extraneous information from your life that would drown you in a sea of inefficiency."
That was what prompted Jill Price to contact the memory experts at the University of California at Irvine in 2000. As she wrote in a book published this summer, "The Woman Who Can't Forget," Ms. Price could recall in detail virtually every day since she was 14, but she was mentally exhausted and tormented by her memories. UC Irvine scientists are interviewing more than 200 people who say they have similar "autobiographical" memories, but so far have found only three more.
Memories of singular, significant events -- say, last week's historic election -- are generally easy to recall; people typically store them in long-term memory with many associations attached.
Memories of mundane, recurring events compete to be recalled, and scientists say the brain appears to be programmed to forget those that aren't important. Neuroimaging studies show that it's the brain's prefrontal cortex, the area of complex thought and executive planning, that sorts and retrieves such "like-kind" memories. Researchers at Stanford University's Memory Laboratory demonstrated last year that the more subjects forgot competing memories, the less work their cortexes had to do to recall a specific one. In short, forgetting frees up brain power for other tasks, says psychologist Anthony Wagner, the lab's director.
A real-world example, he says, is having to learn a new computer password every few months: As your brain suppresses the memory of the old password, it gets easier to summon the new one.
In fact, forgetting is a very active process, albeit subconscious, neuroscientists say. The mind is constantly evaluating, editing and sorting information, all at lightning speed. "Your brain is only taking a small amount in, and it's already erasing vast amounts that won't be needed again," Dr. Devi says.
Much that happens during the day doesn't make an impression at all because our attention is focused elsewhere. Take your daily commute, says Dr. Wagner: "A heck of a lot of stuff is landing on our retinas as we're driving down the road. But if you were focusing on the presentation you have to give, you didn't perceive it and it didn't get stored."
He notes that people face such a constant cognitive barrage that they frequently fail to attend to information that isn't essential at the time. "I have two 4½-year-olds and I'm already thinking, where did those first four years go?" Dr. Wagner says.
Numerous studies have shown that when people are asked to focus on one thing, they can fail to notice others— phenomenon called "change blindness." In one famous test, when viewers are asked to count how many times a basketball changes hands in a video, roughly half don't notice that a gorilla walks through the scene.
Conversely, people who have remarkable memories for, say, sports statistics or who-wore-what to parties paid attention at the time and attached significance to it, while it doesn't register on other people's radar screens at all.
Are memories for events you didn't focus on stored in your brain nevertheless -- like unwatched bank-surveillance tapes? That's an area of much debate. Some experts believe hypnosis can trigger long-buried associations. But so-called recovered memories are also susceptible to distortion.
"Memory consists of billions of puzzle pieces, and many of them look the same," Dr. Devi says. "Each time you retrieve a memory, you're reconstructing a puzzle very quickly and breaking it down again. Some of the pieces get put back in different places."
What if you want to remember more about each passing day? One simple method is to keep a journal. Writing down a few thoughts and events every day not only makes a tangible record, it also requires you to reflect. "You're elaborating on why they were meaningful, and you're laying down an additional memory trace," says neuroscientist James McGaugh at UC Irvine. Taking photographs and labeling them reinforce memories too.
But remember that forgetting can be very useful, says Dr. McGaugh: "If you used to go out with Bob and now you're married to Bill, you want to be able to say, 'I love you, Bill.' That's why forgetting is important."
Write to Melinda Beck at HealthJournal@wsj.com
Wednesday, November 12, 2008
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