Death of global free market capitalism?

Remember Friday March 14 2008: it was the day the dream of global free- market capitalism died. For three decades we have moved towards market-driven financial systems. By its decision to rescue Bear Stearns, the Federal Reserve, the institution responsible for monetary policy in the US, chief protagonist of free-market capitalism, declared this era over.

It showed in deeds its agreement with the remark by Josef Ackermann, chief executive of Deutsche Bank, that “I no longer believe in the market’s self-healing power”. Deregulation has reached its limits.

Read the full article. "The rescue of Bear Stearns marks liberalisation’s limit"
By Martin Wolf published on Financial Times.

Gloom for the Bear

The shocking collapse of one of America's biggest investment bank Bear Stearns is a sobering reminder of just how quickly a Wall Street firm can lose the confidence of investors, traders, and other institutions.

In a deal reached on Sunday to save Bear Stearns, JPMorgan Chase agreed to pay a mere $2 a share to buy all of Bear — which a little over a year ago was trading for as high as $170 a share.

As part of the watershed deal, JPMorgan and the Federal Reserve will guarantee the huge trading obligations of the troubled firm, which was driven to the brink of bankruptcy by what amounted to a run on the bank.

A week before the dramatic announcement, Bear executives were talking about how the firm was poised to report a profitable first quarter, after the firm posted its first quarterly loss in its history in the fourth quarter. But in the span of seven days, Bear went from being Wall Street's fifth largest firm to another in a long line of investment firms to bite the dust.

The purchase price offered by JPMorgan is an indication of just how far things have fallen at Bear, which a year ago helped spark the sub prime meltdown with the collapse of its two big hedge funds.

It appears that the housing mortgage crisis in America has taken down a giant victim. Nervous employees will now be scratching their heads as many of them will laid off with this merger. This is how the free market works and such cyclical ups and downs are part of the business process.

Faces of Innovation at ETech

From left: David Pescovitz, Xeni Jardin, Cory Doctorow and Mark Frauenfelder

Photo: Dave Bullock/Wired.com

According to Wired.com, this wily gang of web renegades runs BoingBoing.net, one of the world’s most popular blogs (according to Technorati). Boing Boing started two decades ago as a paper-based magazine. If something rad is happening on the net, Boing Boing will feature it.

They are featured in this picture attending the O’Reilly’s Emerging Technology Conference which brings some of the brightest minds in the online world together every year for four days of talks, panels and workshops.

US mortgage crisis affects bond markets

The recapitalization of U.S. bond insurers hit by the subprime crisis may occur soon, but if it fails, insurers can be forced to separate riskier activities from their municipal bonds business, New York state officials said on Thursday.
"The clear preference is a recapitalization of the companies, something that could happen at some point. We would hope shortly," Gov. Eliot Spitzer told reporters after testifying before a U.S. House Financial Services subcommittee about the state of the bond insurance industry.

Lawmakers have said government intervention may be needed to ease financial strains in the bond industry that are unsettling other areas of the economy.

While one major U.S. bond insurer cautioned members of a House subcommittee against stricter government rules or a bailout, another saw its credit rating cut over worries it may lack the reserve cash to cover surging defaults.

An offshoot of the mortgage crisis, the dislocation in the bond insurance industry is spreading beyond Wall Street, threatening the cost of financing everything from student loans to public works projects, officials say.

Credit-rating agency Moody's Investors Service on Thursday downgraded from "AAA" to "A3" securities of Financial Guaranty Insurance Co., saying it does not have enough capital in reserve to cover a potential spike in claims. Bond insurers essentially need a "AAA" rating to continue writing new business.

Alarming report on mental health

A government policy launched in the 1980s namely deinstitutionalization of the mentally ill has been called a failed experiment by the British Columbia's Premier Gordon Campbell who was elected in 2001. The increasing problem of the mentally ill came out in an investigative report by the police that revealed a third of all police calls deal with the mentally ill.

The mayor of Vancouver says he's not surprised the police research report. But Mayor Sam Sullivan says he's still shocked by the actual number of such calls and the amount of resources Vancouver police have to devote to dealing with mentally ill people.

This is the result of a dysfunctional health system which refuses to treat mentally ill who aren't off drugs. The Mayor said that many of those the police encounter should be in institutions and not on the street. Due to the lack of institutional capacity, Vancouver's mentally ill are roaming the streets posing a danger to either themselves or others.

Dr. Kalam's inspiring message

Former Indian President A P J Abdul Kalam has given the following message to Rediff, as India celebrates the nation's Republic Day on 26th January 2008.


1. Wherever I am, a thought will always come to my mind -- *What can I give?*

2. Whatever the mission I will do, my motto will be *to work with integrity and succeed with integrity.*

3. I will always remember that *my winged days, be not spent in vain*.

4. I realise I have to set a great goal that will *lead me to think high*, work and realise the goal.

5. My greatest friends will be *great human beings, great teachers and great books*.

6. I will firmly believe that no problem can defeat me; *I will become the captain of the problem, defeat the problem and succeed.*

7. My National Flag flies in my heart and I will bring glory to my nation.

Source: Rediff.

Critical Suharto recieves graft settlement offer

Former Indonesian President Suharto, who ruled the Southeast Asian nation for 32 years, was offered an out-of-court $1.5 billion settlement of civil corruption lawsuits against him as the 86-year-old lay in hospital fighting for his life.

The settlement of the civil case against Mr.Suharto is based on allegations that he embezzled money from a charity during his rule.

It was announced that President Susilo Bambang Yudhoyono agreed to the settlement offer after Suharto suffered multiple organ failure, in order to reach a 'win-win solution.'

Mr.Suharto, who had corruption charges against him dropped in 2006, is fighting civil cases for alleged misappropriation of funds.

Suharto is alleged to have taken as much as $35 billion, averaging 1.3 percent a year of Indonesia's gross domestic product, according to the United Nations Office on Drugs and Crime. Mohammad Assegaf, Suharto's lawyer, has said the UN report is ``nonsense.''

Suharto's family has rejected the latest offer saying the former president has done nothing wrong.

Taunting racial insults

Furious fans in India burn effigies of the Australian cricket team


India have stopped playing matches in their Australian cricket tour after one of their team was banned from playing.

Bowler Harbhajan Singh denies breaking the rules of how cricketers should behave by saying something racist to an Australian player.

Harbhajan is appealing against his three-match ban, and his team won't carry on unless he's allowed to play.


The international game is governed by The International Cricket Council (ICC) which has has 101 members: 10 Full Members that play official Test matches, 33 Associate Members, and 58 Affiliate Members.

The game is played not in the spirit of the sportsmanship and camaraderie that it used to be known for: the gentleman's game. It is driven by the big money of corporate sponsorships and broadcasting rights and highly paid contracted players.

Squeezing out net videos

YouTube fans in China may not find it easy to watch some videos when the new rules take effect.

China is to further tighten its grip on the internet and has announced strict new regulations on the broadcasting of online videos - including those posted on video-sharing websites – restricting them to sites run by state-controlled companies.

The new rules also require service providers to report questionable content to the government and "abide by the moral code of socialism".

China, the world's second-largest Internet market by users, has encouraged growth of the internet but at the same time has imposed increasingly tough controls on what can be seen online inside China.

The rules are aimed at stopping what the government calls "degenerate thinking" via the Internet and maintaining a "healthy online environment".

Pro-democracy websites are blocked, as are the sites of many international news organisations, and a force of about 30,000 internet police are thought to monitor the web for anything seen as undesirable content.

The new rules, which come into force on January 31, mark a fresh attempt by Beijing to curtail the internet habits of an increasingly web-savvy population that has become accustomed to decades of state intervention.

Great inspiration from "I Live Inspired"

Chris Deutsch and Robert Foster, two American entrepreneurs are the founders of I Live Inspired, a website that sends out daily text messages carrying inspirational quotes authored by motivational experts in self-help, parenting, and business.

In October, Deutsch and Foster walked 100 miles through evocatively named cities in Indiana. The journey took them from Hope to Buddha and on to Bloomington, where the Dalai Lama was scheduled to attend a series of events at Indiana University and the Tibetan Mongolian Buddhist Cultural Center (TCC).

Deutsch and Foster did a symbolic, mindful walk to draw some attention and see if we could get a meeting that way with the Dalai Lama. It worked. The day the two arrived in Bloomington, they were granted a session with the Dalai Lama.

"We call them pilgrims," said Lisa Morrison, TCC's public relations director.

Deutsch and Foster were given permission to send out pre-approved quotes from the Dalai Lama. In return, they're donating to TCC 75 percent of the proceeds generated from the Dalai Lama-themed text messages.

Now their holiday dream is to meet Al Gore in order to include quotes from former vice president and recent Nobel Peace Prize laureate in their fledgling website.

Lower grades among the sleep skippers

A survey of 120 students at St. Lawrence University, a small liberal arts college in northern New York, found that students who have never pulled an all-nighter have average GPAs of 3.1, compared to 2.9 for those who have. The study, by assistant professor of psychology Pamela Thacher, is to be included in the January issue of Behavioral Sleep Medicine.

A second study by Thacher, a clinical psychologist, had "extremely similar" results showing lower grades among the sleep skippers.

Many college students, of course, have inadequate or irregular sleep, for reasons ranging from excessive caffeine to poor time management.

Dr. Howard Weiss, a physician at St. Peter's Sleep Center in Albany, said the study results make sense.

"Certainly that data is out there showing that short sleep duration absolutely interferes with concentration, interferes with performance on objective testing," he said.

Some night owls do get good grades, of course, which may be explained by circadian rhythms, Weiss said. Circadian rhythms can be tracked through body temperature and hormonal transmissions.

Some people have different 24-hour body clocks than others, and may do better depending on class and testing times, Weiss said.

WIFI in the sky

The New York Times is reporting that airlines will start testing in-flight Internet connectivity as early as next Tuesday. This is good news for business travellers for whom the Internet has become a vital tool for success. For leisure travellers and others, it offers a new horizon to deal with the boredom and lack of productivity that comes with air travel.

Both JetBlue and American Airlines will be kicking things off with free email and instant messaging on its planes- JetBlue is only offering e-mail and IM connectivity, while American has plans for full 'Net access—and will only initially be available on certain flights, both represent a significant step towards full online connectivity at 35,000 feet.

It's still not clear how much Internet access would cost on either airline. There seems to be some confusion on this point, with some people claiming that the service will be free, while others say it'll cost $10. That $10 figure is actually drawn from a Reuters story from last August.

Selling Peace

Imagining Peace in Darfur. Make Love, Not War

Bret Dey writes, In March 31, 1969, John Lennon and Yoko Ono appeared at a Vienna press conference in a bag large enough to hold the two of them closely together, hidden from the glare of the camera flashes. Inside the bag, they claimed to be eating chocolate cake. Perplexed, the press asked questions and John and Yoko explained that the bag represented total communication. “When you’re in a bag, you can’t be judged by the color of your skin, the length of your hair, your age or any other attributes.”

38 years later, peace is still not an easy commodity to sell when you are dealing with Sudan that is alleged to have committed genocide, more than 250,000 killed and as many as 2.5 million are thought to have been displaced as of October 2006.

John Lennon realized that his high-minded art projects and chants of “Give Peace a Chance” were simplistic. And, to him, that was exactly the point. “We’re trying to sell peace, like a product,” he said on The David Frost Show. “We’re trying to sell peace the way people sell soap or soft drinks.”

This is what the African Union is preparing to do. Renegotiate the Darfur Peace Agreement, an agreement designed to explore, explain and communicate what peace is about hoping that affected parties will sign on to it.

Fulfilling the unlived life

Australian media reports that according to a new study, two-thirds of Australians were more likely to share personal information with other people on the Internet than they would in person. Just over half of Australians published three or more types of personal information on blogs, social networking sites or online shopping sites, while a third published their home address and two thirds revealed their real name.

Two-thirds of respondents also said people post personal information online without thinking through the possible consequences. Australians are more trusting online than in person — and it's putting them at risk.

Australians are facing an online identity crisis, using the web and social networking sites to unleash their alter egos, new research suggests.

Woolcott Research and was commissioned by Internet security firm Symantec to conduct the survey. It found Australians typically had more than 10 virtual identities. They included profiles on sites like MySpace and YouTube, email accounts, game avatars and characters in virtual worlds.

"This is what we used to call multiple personality disorder," said Andrew Fuller, a clinical psychologist and fellow of the University of Melbourne's Department of Psychiatry.

Andrew Fuller said the relative anonymity of the Internet encouraged people to be more open with their character, particularly in sites devoted to social networking, dating or gaming.

"Their online profile is more about who they would like to be, rather than who they really are," Dr Fuller said.

Symantec, says criminals could use information found in online profiles to commit fraud in the real-world ("identity theft"), or for social engineering.

Symantec regional consumer business vice-president David Freer said the biggest step towards preventing identity theft was education and that users should be wary of which details they provide online.

"Our internet security threat reports have seen the number of attacks double over the last six months," he said.

More than 2 billion deceptive messages attempting to elicit personal information from users – known as phishing attempts – had been detected so far this year, Mr Freer said.

"We suggest to people that they really look at what they're sharing online. Do you really need to put the information up online that you have?," he said.

Writers strike costs $US21m a day

The 2007 Writers Guild of America strike which is a strike by both the Writers Guild of America, East(EGA) and the Writers Guild of America, west(WGA) that started on November 5, 2007. The two labor unions represent 12,000 members of film, television and radio writers working in the United States.The Writers Guild of America and the Alliance of Motion Picture and Television Producers agreed last week to return to the bargaining table on November 26.

According to reports this strike against major studios will cost at least $US21 million ($24 million) a day in television production spending alone and idle 10,000 workers if it lasts much longer, experts say.

The latest estimate accounts only for lost wages and other production costs in the Los Angeles area.

The writers have been demanding for a greater share of revenues from the Internet, widely seen as the future distribution pipeline of choice for filmed entertainment.

Hong Kong takes aim at thriving Islamic finance

Hong Kong's market watchdog has cleared the way for the territory's first Islamic fund, as the financial centre tries to compete with Singapore and Malaysia as a hub for Muslim investment.

“To further consolidate Hong Kong’s position as a global financial center, we should actively leverage on this new trend by developing an Islamic financial platform in Hong Kong,” Donald Tsang, the Chief Executive told legislators in his annual policy address this year.

“Apart from stepping up our efforts to promote Hong Kong’s financial services to major Islamic countries and regions, we will focus on developing an Islamic bond market," he said.

Islamic finance fuses principles of sharia or Islamic law and modern banking. Funds are banned from investing in companies associated with tobacco, alcohol or gambling, considered taboo by Muslims.

The system also bans the earning of interest.

A report earlier this year valued Islamic financial assets currently under management at more than 400 billion US dollars worldwide, with the industry growing at double digits annually.

Malaysia has "effectively established itself as the regional, if not global, hub for Islamic finance," said the report by Financial Insights, a company under market research and analysis firm International Data Corp (IDC).

Indonesia, Pakistan, Thailand and Singapore are also promoting Islamic finance.

US revamps Medicare

Starting next week in the United States, those eligible for Medicare can begin enrolling in the optional drug plan for 2008, with a dizzying array of choices — and potential premium increases for 74% of those who currently have a stand-alone drug plan.

About 1.6 million low-income enrollees will be switched from their current plans to other insurers because premiums rose above a government benchmark.

Medicare is the federal health insurance program for people over 65 that has been in existence for more than 40 years in the United States. Congress added a prescription drug benefit, known as Part D, two years ago.

Although Part D is subsidized by the federal government, it is run by private companies, many of which have aggressively marketed their products.

It’s that time of year again when seniors who want to switch their drug plans have to sift through the fine print of stacks of documents.

There are 55 Medicare prescription drug plans along with thousands of other Medicare supplement programs for sale, according to the state Office for the Aging. When those choices are added to the need to coordinate drug coverage, many Medicare beneficiaries are faced with what the office called "a complex maze of choices.''

Medicare officials say that people can avoid premium increases next year: "In every state, people will be able to find a plan that costs less than $20 a month," says Herb Kuhn of the Centers for Medicare and Medicaid Services. Therefore it pays for seniors to shop around.

The average monthly premium for a Medicare prescription drug plan will increase to $25 next year, a 13 percent increase, according to the federal government. The plans were created in 2005 to offer more coverage to the country’s 43 million Medicare customers who rely on Medicare for their health care.

In general, United States is opposed to any "socialized programme", yet they do have some “socialized” programmes . Some examples include fire protection, police services, garbage pick up, roads, parks, schools etc. But health care is not one of them. This health care system is broken and serves only private interests. It seems in the US system, the insurance companies have far too much power over decisions regarding a patients health care needs. The United States has the highest per capita health care spending in the world, with comparatively disappointing results compared to European models of health care.

One of the fundamental problem that the US faces is that the ratio of workers paying Medicare taxes to retirees drawing benefits is shrinking at the same time that the price of health care services per person is increasing. Currently there are 3.9 workers paying taxes into Medicare for every older American receiving services. By 2030, as the baby boom generation retires, that is projected to drop to 2.4 workers for each beneficiary. Thus financing the medicare is going to be a huge task.

According to the Census Bureau's 2005 Current Population Survey (CPS), there were 45.8 million uninsured individuals in 2004, or 15.7% of the civilian non-institutionalized population. Since virtually all individuals over age 65 are covered by Medicare, the uninsured are primarily adults under age 65 and children who do not have medical insurance.

Singapore pays tribute to Sim Kee Boon

Former top civil service head Sim Kee Boon, who had been battling stomach cancer for 15 years, died on Friday morning. He was 78.

Mr Sim is one of the most well-known and respected public figure, who headed the civil service from 1979 to 1984, and had held numerous top positions in the public sector and statutory boards. He is survived by his wife Jeanette Sim, 76, five sons and five grandchildren.

The passing of former civil service head Mr Sim Kee Boon is a "loss" to the nation, said Prime Minister Lee Hsien Loong.

Mr Lee said Singapore owed an 'enormous debt' to public servants such as Mr Sim. "They grew up; they saw the country change; they made the change happen."

The prime minister said that as head of the civil service from 1979 to 1984, Mr Sim set the tone for the organisation and led it to achieve many highs, including the building of Changi Airport.

Tributes poured in from many who had worked with him in the civil service and business community. Many who knew him described Mr Sim as "a very sharp and intuitive man, and a good teacher." It is reported that whenever he's at any airport, he would make an effort to look around. He is known to go to the airport about one or two hours earlier and board the plane at the last minute. A hands-on man with exacting standards, he made frequent unannounced walks around the Changi terminals, instituting the habit of Management by Walking Around (MBW) in CAAS.

Leading the tributes from the Keppel group where Mr. Sim presided 16 years as Excecutive Chairman, Mr Lim Chee Onn, the current Executive Chairman of Keppel Corporation, said: "He developed a strong and stable platform for Keppel upon which we have been able to develop and grow at a sustained pace during these last 8 years. Keppel's success today is a result of his vision and efforts.

Mr. Sim is an outstanding personality who has left his mark on a country that is proud of and grateful for his contribution.

C K Prahalad: Rising Indian thinkers

C K Prahalad, India-born management guru and academician, has been voted the world's most influential living management thinker ahead of hands-on managers like Bill Gates, Alan Greenspan and Richard Branson.

C.K. Prahalad is Harvey C. Fruehauf Professor of Business Administration and Professor of Corporate Strategy and International Business at the University of Michigan Business School. The recipient of the Global Indian Award from the Economic Times Awards for Corporate Excellence, Prahalad is a globally recognized business consultant. His groundbreaking article, “The End of Corporate Imperialism," won the 1998 McKinsey Prize as the year’s best Harvard Business Review article.

Prahalad, who is the first Indian-origin thinker to claim the title, was ranked number three in last year's Thinkers 50 list brought out by Suntop Media. The Thinkers 50 2005 was developed as a guide to which thinkers and ideas are currently having greatest impact in business.

"Best known for his work 'Competing for the Future' with Gary Hamel (ranked 5th) on resource-based strategy, which gave rise to the term core competences, more recently, Prahalad has turned his attention to the plight of the worlds poor," said Stuart Crainer and Des Dearlove of Suntop Media.

In his book "The Bottom of the Pyramid", he argues that capitalism can be the engine to eradicate poverty.

“If we stop thinking of the poor as victims or as a burden, and start recognizing them as resilient and creative entrepreneurs, a whole new world of opportunity will open up,” he explains.

In economics, the bottom of the pyramid is the largest, but poorest socio-economic group. In global terms, this is the four billion people who live on less than $2 per day, typically in developing countries. The phrase “bottom of the pyramid” is used in particular by people developing new models of doing business that deliberately target that demographic, often using new technology.

Alibaba IPO soars to pre dot com heights

Alibaba.com is China’s largest business-to-business trading website for companies. On Tuesday, Alibaba.com saw its shares triple after its initial public offering rocketed 192% on the Hong Kong stock exchange.

Alibaba.com sold 858.9 million IPO shares, or 17% of its enlarged share capital, in a deal handled by Deutsche Bank, Goldman Sachs, and Morgan Stanley. The stock performance raised $1.5 billion in the largest high tech offering since Google went public in 2004.

Founded in 1999 as a bulletin board for businesses leads, the Web site connects companies looking to import and export Chinese goods. The company said recently that at the end of June its online marketplaces had more than 24 million members.

The IPO is being closely followed because it is rare for an Asian technology company to decide to list in Hong Kong. In the past, such companies have typically sought to join the technology-focused Nasdaq in the US.

In 2005, Yahoo paid $1bn and contributed its own struggling Chinese internet business in return for a stake its Alibaba.

Alibaba is valued at $8.8bn, while Yahoo’s investment is worth $3.4bn.

The success of this business-to-business Web site is the most visible sign that the Internet is opening entrepreneurial opportunities in a way never before seen in China. With more than 162 million Internet users, China is close to surpassing the United States - and that's a fraction in a country with a population of 1.3 billion.

Alibaba.com business model is making it easier for Chinese manufacturers to run their businesses and to connect with companies around the world.