Podcast

Our podcast can be found here

http://depositfiles.com/files/nexzm32s9

http://rapidshare.com/files/317188357/podcast_final.mp3.html (alternative link)

note: it is advised to listen with a headset because the recording is a bit quiet.

Dubai shockwave hits global markets

Dubai World, the largest government owned company in Dubai, has requested a debt standstill of their lenders. This suggest they have financial problems and won't be able to pay back their debts in time. When this news reached the western countries on thursday the stock markets took a big dive. This is mainly because most of the investors and lenders are in Europe and the United States. The Dow Jones did not move because it was closed due to Thanksgiving day, but major European markets like the FTSE 100 and the CAC 40 went down at first. This was a first reaction until an official reaction of neighbour state Abu Dhabi or the United Arab Emirates federation. But this wasn't possible before the weekend. The situation continues to be very tense as everybody is waiting for an announcement on monday.

In my opinion this isn't a good situation. As Dubai World is the largest government owned company and at the center of all major building projects in Dubai, but one does not have to panic all to quickly. Dubai is part of the wealthy United Arab Emirate federation as is the wealthy neighbour Abu Dhabi. The federation has been trying to prove to the rest of the world that they aren't as far behind like everyone thinks. This to me seems like a perfect situation to prove it. I'm very confident that either Abu Dhabi or the federation itself will help Dubai so it doesn't have to default on its debts. If not then it would make a huge mistake and will suffer a hit in their reputation. I totally understand the markets reaction but don't see a need to write off Dubai immediately.


Source:
http://www.ft.com/cms/s/0/7896cac2-db93-11de-9424-00144feabdc0.html?nclick_check=1

Privatisation: Government sale plans hang in the balance

The subject of the article is that Poland wants to sell a lot of their private companies. That means that they want to sell the companies that are owned of the government to private companies. They want to sell these companies as quick as possible because they want to survive the financial crisis without large debts. With this privatisation they can pay off a lot of their debts. The bad think is that the public debt will raise enormously. There are a lot of companies that will be privatised: the big airplane company, LOT Polish Airlines, the Warsaw Stock exchange, their second largest power-producer Tauron, an oil refiner… That will be about 670 companies that will be sold,(for 37bln zlotys).

In my opinion it isn’t very smart of the polish government to sell these companies because it will loose a lot of good companies to the private sector. If they now sell their companies, than the private companies will have large debts. This increase in debt will not make it easier for the Polish economy. I think that it is better that the government retain their companies and keep investing in their companies, so their economy will be stimulated and the crisis will not linger. After the crisis they can still sell their companies, they will receive more money and the private companies will be enthusiastic to buy them.

Source: http://www.ft.com/cms/s/0/428efa62-d30a-11de-af63-00144feabdc0.html

Apec leaders drop climate target

The world leaders still didn’t come to an agreement to reach a new climate change deal. After a two-day conference, there were still a few leaders who weren’t convinced about the new deal. This deal contained a target to halve greenhouse gas emissions by 2050 and a new strategy for growth after the world's worst economic crisis.

The target to lower the greenhouse gas isa very controversial issue in the world community, which could disrupt the negotiation process for a long time. That’s why some think it was unrealistic to expect a full, internationally legally-binding agreement .
They came to a joint declaration about certain things like rejecting all forms of protectionism and reaffirm our commitment to keep markets open and refrain from raising new barriers to investment or to trade in goods and services. They also agreed to keep stimulus spending in place until a recovery was seen.

I think it’s a good effort of all the world leaders to negociate about it, but first they need to study it further. They need to establish a good plan, that is realisable for everyone. This will take a lot of planning and efforts of everyone, but it’s necessary, because everybody need to stand behind the plan.

Source : http://news.bbc.co.uk/2/hi/asia-pacific/8360982.stm

G20 Vows to spur fragile growth

The worldwide economic crisis seems to end but finance ministers from rich and developing countries warn everybody that the global recovery hasn’t been assured yet. Last Saturday there was a meeting in Scotland where de ministers discussed about this issue.

The main statement of the G20 was that the main concern is the high unemployment and that supply is still needed for the global recovery. A first proposal, funds for bank bailouts who are being paid by taxes on transactions, was not very successful. Most G20 countries didn’t found this a good proposal but the British Chancellor of Exchequer announced that we cannot withdraw the support.

But the meeting was overshadowed by a message from the British prime minister, he claimed for a new social contract that would banks make more responsible. He said that the government was obliged to intervene and help the financial sector because they have a very important role in the society and that a global levy on bank transactions was a great idea to make the banks pay. But he also announced that this must be agreed worldwide, otherwise he wouldn’t take any action in his country.

The idea from the British minister has been received rather good by the other G20 countries, but British bankers and the Canadian prime minister reacted negative. The next meeting will be in Copenhagen where they talk about the climate.

In think that the levy on bank transactions has positive and negative effects. I think that the banks aren’t recovered enough and this could make new problems for the banks. On the other hand the economic crisis is caused by the banks and till today most banks didn’t take their responsibility.

Poelaert Jens – 3FV3

Date: 11 November 2009

Source: http://news.bbc.co.uk/2/hi/business/8348121.stm

RBS admits EU sale plan

The Royal Bank of Scotland has recently admitted that the European Union forced them to sell more assets than it had planned.
In the morning of the 2th of November, RBS announced that they had to make some sacrifices to conclude a deal to receive state aid support from the EU. The sacrifice RBS is supposed to make was that they have to sell parts of its operations which they hoped to preserve after the restructuration.
The main concern from RBS is now to maintain as much as possible from their original recovery plan without losing too much from their activities.
The EU is demanding that RBS sells their Churchill and Direct Line insurance operations, as well as hundreds of branch offices. RBS is also trying to fight the demand of the EU to sell their US retail arm, Citizens Bank.
In my opinion the European Union has the right to make demands towards the banks that are in need for financial support. All this support is mainly tax payer’s money and therefore the possible risk of losing this should be strictly minimized. Also the priorities of the banks are completely different then those of the EU. The banks will try to restrict their dismissals to a minimum and try to obtain as much support as possible.

Source: http://www.guardian.co.uk/business/2009/nov/02/rbs-admits-eu-sale-plan

Italy fury at ‘Taliban pay’ claim.

In the article the speak about the fact that there is told that the Italian government paid the Taliban to let survive their soldiers in a area that they took over. This claim is published in an UK newspaper report. The fact that the people think these claims is because the French soldiers have taken over this area now and from on that moment there are already killed 10 French soldiers and 21 injured in a mountain ambush. In the previous year there was only one soldier that was killed.

The Italian government really couldn’t laugh with this claims and said that there was nothing true about it.
I think that it is a stupid idea that a government would pay for let their soldiers live. If there is war in an area than you fight for peace, you don’t go over there for paying the opposition (the fighters of the Taliban) to let yourself live than it is better that you stay at home. I think that it has something to do with the fact that the Italians are more liked than the French soldiers. Why wouldn’t they kill an Italian and kill a French? The French had maybe did something wrong. Otherwise they wouldn’t say that they believe in the fact that the Italian government is honest and don’t pay bribes.
I think that the French government knows why their soldiers are killed. It is true that they say if there is somebody who pays money to the Taliban than it is the Afghan government themselves. It would be stupid from a country to pay for peace. You can’t get peace by paying for it. Or the Italian soldiers had just being lucky that the Taliban never found their camp and never attacked them. In my opinion these claims aren’t true and are garbage like the Italian Defence Minister Herve Morin told.

http://news.bbc.co.uk/2/hi/south_asia/8309464.stm

How come Wall Street is minting money in this crisis?

While most people fear of losing their jobs due to the tough economic times, the banks are making boatloads of money. The only reason for this is because of the intervention of the united states government. As the biggest banks of America were seen as too big to fail, the government quickly aided the struggling banks with a stimulus plan. But now these big banks are profiting from the bad economic situation. Instead of giving more loans and decreasing their other high risk activities they are doing the exact opposite. With an all time low interest rate, the banks are able to lend money at no cost and investing it in high risk areas like stocks or bonds. The competition was also thinned down since last year which makes them able to lend money at even higher interest rates. The stimulus money from the government was to save the banks but with the expectation that they would get smaller and focus more on the traditional actions like lending money.

I think that the stimulus plan of the government was good and absolutely necessaries. This doesn’t mean I agree with the current actions of the banks. Although they are saying they want more regulations, it just seems that it’s business as usual. They totally ignore the working people and only focus on making the most money. The government should have had a lot more conditions for the stimulus plan and enforce those conditions.

source: http://www.nytimes.com/2009/10/17/business/economy/17wall.html?ref=politics

Senate panel passes health bill

The new president Barack Obama has achieved another item. In his campaign for president elections he promised to do something about the US healthcare and recently the government panel has approved a bill to reform the US healthcare. The outcome of the vote was 14 in favor and 9 against.

Creating more insurance for Americans and cutting some health costs are 2 mean reasons why the senate has approved the health bill. But there are also some negative reactions, some people of the committee believe that the panel bill is making more government control.

There is still a long way to go for a better healthcare in America. But with the approval of this health bill, it looks like president Obama has achieved more then president Clinton in 1990. Because his attempts to create a better healthcare never got beyond the committees.

But not everybody is happy with this new measure. The lawmakers are divided about the public option. Because some studies showed that the costs could be higher than expected.

In my view, I think that the approval of the health bill is a great step forward in the healthcare of America. A lot of people in America aren’t insured because they don’t earn a lot of money. When an uninsured person gets ill or had an accident they have to pay the total sum of the hospital bill. A lot of people cannot pay this, so they don’t receive medical care. I don’t think this is acceptable in a modern country like America.

Source: http://news.bbc.co.uk/2/hi/americas/8304375.stm

Date: 13/09/2009

Climate protectionism on the rise

One of the biggest dangerous in the form of trade and technology protectionism is damaging the North-South relations and this leads to a climate change. The United States is taking measures, such as imposing tariffs, taxes or charges on products of developing countries to protect their own products.

The Us government just passed a bill against technology transfer to adopt and protect themselves against foreign competition on the technology market. Other countries start to follow them and are also taking measures including countervailing border measures, against goods and services imported from developing countries on grounds of protection and stabilization of climate.

The developing countries are starting to oppose these moves, because they think is not fair. Developing countries claim that linking trade measures to climate and the environment are unjust because they have lower technological capacity and thus cannot match the developed countries. Developing countries should instead be assisted through technology transfer
I think all measurements should be lifted because it doesn’t help the world economy. In the contrary, it stops the recovery of the world economy. We live in a world of understanding and helping each other and this proves the opposite. These measurement undermine the free economy. That’s why I’m against protectionism.

Source: http://www.atimes.com/atimes/Global_Economy/KJ10Dj01.html

Interest rates 'to stay low for years'

The British government has decided to allow the interests rates to be very low to help the weakened economy. Also other instruments will be used to aid both individuals as companies in these difficult economic times. Most likely through tax rises and spending cuts to deal with the country’s deficit. The report forecasts that if the Conservatives win the elections, they want to receive £20 billion in taxes and save £80 billion by reductions. Only tricky thing about possible tax rises is the next year general election that can easily damage every political party that supports getting more money out of the tax payer’s wallet.

I think it’s the moral duty of the government to use all political/financial ways and means at their disposal to boost the economy. Tax rises will most likely harm every citizen in its material welfare but a government can’t just wait till this crisis is over. It’s better to act quickly and accurate with a relative high cost then wait and bear the even higher costs in the near future.
Source:http://www.guardian.co.uk/business/2009/oct/12/interest-rates-to-stay-low-cebr

Team Blog: Obama links job growth to health proposal

President Obama has one goal and that’s to make the economy stable again. He believes that he can do that with his health plan. This plan would create new jobs and less employment.
He believes if aspiring entrepreneurs can stay insured while switching jobs, they will start new businesses and hire workers. This is de main goal because it creates new jobs and makes the economy grow. It’s also really necessary that it happens fast because 15.1 million people are already now out of work.
The big problem today is that many people have a good idea, but they don’t have the expertise and determination to build it into a thriving business. They also don’t have the courage because they can't afford to lose the health insurance they have at their current job.
The plan of Obama is build on the fact that everybody should have a health insurance and who can’t afford one , should get help of the government.
We don’t believe in the plan because the people of the United States also don’t believe in the plan. The Cities and States have not been able to meet their budgets due in part by the number of unemployed, obviously to most common sense people: no job, no buying of products and/or paying of taxes! They lobby to much instead of making a really good plan.

Source: http://www.washingtontimes.com/news/2009/oct/03/obama-links-job-growth-health-care-proposal/comments/?cpage=1

Team blog