Archive for October, 2010

  • The long road ahead>
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    The long road ahead
    A wave of infrastructure projects are sweeping across the face of this big blue rock we call planet Earth, but the United States is remarkably immune to this epidemic. And that can be put down largely to the stonewall America has presented to almost any and all opportunities to spend money. That more than anything else is hurting the improvements we need to put in place with roads, airports, seaports and railway systems across the length and breadth of the land of the free and home of the brave. Slightly worryingly, the American Society of Civil Engineers published a report that put the figure of investment needed for America at $1.6 trillion over a period spanning five years. And that’s just to bring infrastructure up to a level that can be deemed standard, so the road is long and arduous. But  [...]
    at October 27th, 2010 at 12:10 am
  • No home comforts to be had>
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    No home comforts to be had
    It has been a little more than a month since some paperwork pertaining to a mortgage mysteriously disappeared from the files of the Washington Mutual Bank, but they seem strangely unworried about it. This is a multimillion-dollar mortgage we’re talking about here, and a crucial piece of paper to boot, yet no one seems perturbed. After undertaking a search operation to try and find the missing documentation (a promissory note that mentioned the borrowers commitment to pay off the mortgage), an assistant vice president gingerly drew up an affidavit that stated the document could not be found, simple as. It is an attitude that is alarmingly lackadaisical and callous, and Washington Mutual Bank are not the only ones to demonstrate it. The year was 2006, and the handling of the matter was  [...]
    at October 25th, 2010 at 01:10 am
  • A taxing issue>
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    A taxing issue
    President Barack Obama has championed the cause of tax changes to the current US tax code in an effort to increase taxes on companies that go about exporting its jobs to foreign shores. For long now, there have been those that have decried the flight of jobs and capital to countries such as India and the Philippines and there have been voices (loud, clear voices) that have wondered why the administration wasn’t stepping in to try and stop this flight of jobs to non-American workers. Perhaps as a response to those exhortations or of his own accord, President Obama has finally spoken out against this phenomenon that is a reality of our and will now hopefully set the ball rolling for tax reforms that will not only swell America’s coffers, but also hopefully create more jobs on American  [...]
    at October 20th, 2010 at 12:10 am
  • The currency war takes two to tango>
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    The currency war takes two to tango
    Imagine for a moment that you were a professor in a classroom of bright-eyed, eager young students looking to learn a thing or two about whatever it is you had set your heart out to learn, and I asked you a very simple question; who, in your opinion, kick-started the global currency war we now find ourselves embroiled in? Obviously some students, having analysed the subject in however much detail, would say that the obvious answer for this was simply China; as one of the largest currency manipulators in the world, China has been one of the most restrictive and manipulated currencies, nothing more than a puppet on a string for the Chinese monetary authorities. They have the single largest trade surplus in the world and foreign exchange reserves that are bottomless (well, not bottomless, but  [...]
    at October 18th, 2010 at 01:10 am
  • Lessons to be learnt>
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    Lessons to be learnt
    A recent study has revealed that students that drop out of colleges after their first year of education will adversely affect their prospects in the near and distant future. But over and above this, these students will also be flushing billions of taxpayers’ money down the drain. That is a damning piece of information after the state and federal government spent in excess of $9 billion in order to support the aims of students that are enrolled at four year colleges and universities. The report was published by the American Institutes for Research (AIR). With the state having borne a major part of the expense of these students, AIR has pegged their appropriation at $6.2 billion when it comes to students dropping out of college during a period ranging from 2003 to 2008. The taxpayer has gone  [...]
    at October 13th, 2010 at 12:10 am
  • Let’s get fiscal>
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    Let’s get fiscal
    You know that things are really bad when a former Federal Reserve Chairman says that the U.S. fiscal deficit is “scary”. That is the sort of description a child might throw out, or maybe an ill-informed and slightly inarticulate student. But when someone that has headed the Federal Reserve chooses that specific word to describe the situation we find ourselves in, you know we’re in some really big trouble. The federal government is playing with fire and it needs to cut any spending on entitlements in what is a very dangerous game. Speaking at an event, Greenspan was at pains to point out the increase in debt that is being held by the American public. It is, in fact, increasing at such a rapid pace that it is swiftly eroding away any capacity we have when it comes to borrowing. The cushion  [...]
    at October 11th, 2010 at 02:10 am
  • A lemon called Lehman>
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    A lemon called Lehman
    The second anniversary of the bankruptcy that shook the world has come and gone and economists will continue to debate whether the bank should have been brought back from the dead or not. But for all of its creditors and former clients a more serious question remains; what can be saved from the wreckage that is now Lehman Brothers? To think that this giant once had over $600 billion in assets now boggles the mind and really, where did it all go so wrong for America’s most complex and famous corporate failure? Since that day 2 years ago, Alvarez & Marsal (A&M) has been restructuring and dismantling Lehman’s holding company and sifting through 65,000 claims from myriad creditors and company derivatives that are convoluted and confusing. It has some 200 people toiling away at the derivatives  [...]
    at October 6th, 2010 at 01:10 am
  • A surprisingly hard sell>
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    A surprisingly hard sell
    It is often said that insurance is not sold to people, it is bought by people and that is so very true for AIA, which is insurance giant AIG’s Asian life insurance division. AIA has been crying itself hoarse trying to sell itself this year and this is the third attempt this year to try and sell itself to a potential buyer to no avail. No one is willing to get anywhere near AIA and a listing was approved on September 21st in Hong Kong and the offer is now expected to go public on October 29th. Given the ridiculous ineptness and gross corruption and misconduct on the part of AIG, it will almost miraculous if AIA manages to get some sort of a deal done. There was an early attempt to list AIA but this was pulled out of in March because a deal seemed to be materializing for Prudential to buy out  [...]
    at October 4th, 2010 at 01:10 am
  • Playing ball with Wall Street>
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    Playing ball with Wall Street
    For most of these college graduate’s, the dream was to play in college football’s national championship, and from there perhaps on to the big leagues as a professional. But there is an altogether different pot of gold waiting for these aspiring sportsmen at the end of the rainbow; a nice, fat six figure salary with a Wall Street firm just as soon as they graduate. Many college-going football players are finding that the bonds that tie their team together are also the bonds that can be used to leverage contacts within financial firms to land jobs and internships. Most of these jobs are the kind that the very top percentile of applicants work hard towards and it is a terrific opportunity for these young adults to make a breakthrough onto Wall Street. And the benefits of having influential  [...]
    at October 1st, 2010 at 12:10 am