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Archive for July, 2008

The Future Of The Middle East

Posted by iBlog on July 6, 2008


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George Bush, World Forum Middle East

Posted by iBlog on July 6, 2008

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Naked Girl 6, Cover Art Magazine

Posted by iBlog on July 6, 2008

THE NSW government will refer a magazine featuring a naked child on the cover to the Australian Classification board.

Art Monthly Australia magazine sparked fresh controversy over naked images of children by publishing an image of a six-year-old girl on its cover to protest against the recent furore over similar pictures by artist Bill Henson.

NSW police seized a number of Mr Henson’s photographs featuring near-naked or naked children in recent months, but were returned to a Sydney art gallery without charges being laid.

The July edition of Art Monthly Australia published the cover image in protest at the “hysteria” over Mr Henson’s work.

It also includes several provocative photos of children posing naked in adult jewellery as well as naked teenage girls.

NSW community services minister Kevin Greene said the images had been inappropriately hijacked for political mileage.

“I will refer this to the ACB tomorrow, and the community also should let (the Board) know what they think,” Mr Greene told reporters in Sydney.

Opposition Leader Barry O’Farrell labelled the publication a “provocative publicity stunt” and called for a review of Arts Council’s funding for the magazine.

He said the average parent faced strict regulation of photographing their children at school events, and would be frustrated by the actions of the magazine.

“I understand they are in receipt of funding from the Arts Council and I assume there are procedures where that can be reviewed by Mr Rudd and his ministers,” Mr O’Farrell said.

“I notice (Premier) Morris Iemma hasn’t ruled them out receiving state government funds in the future.

“The public are furious about the double standards, I think taxpayers are angry when they see funds used in this way and to review it, I think, would be sensible.”

“Restoring dignity”

In the editorial, Maurice O’Riordan said he chose the 2003 picture of the young girl in the “hope of restoring some dignity to the debate” and to “validate nudity and childhood as subjects for art”.

The image, taken by Melbourne-based Polixeni Papapetrou, is believed to be her own daughter.

Mr O’Riordan, who does not have children of his own, told The Sunday Telegraph he did not care if it stirred community complaint.

“I believe the image is of a six-year-old girl,” he said.

“Maybe this is bold, but I don’t see the need to give in to that sort of hysteria or the prospect of complaint.

“I couldn’t really understand the furore.”

The artist, Ms Papapetrou, said she supports the use of her work for the magazine’s cover.

“We need to be clever enough to distinguish art from other types of images, otherwise we live in danger of eradicating any image of childhood in this culture for future generations to see.”

Art Monthly Australia receives more than $50,000 in funding from the Federal Government’s Council for the Arts and lists the New South Wales Ministry for the Arts under sponsors and partner. The State Government has issued grants to the magazine in previous years.

Cheap, sick stunt

NSW Premier Morris Iemma immediately threatened towithdraw future funding after he was contacted about the images yesterday.

“Images of this kind are distasteful, exploitative of children – a cheap, sick stunt at the expense of a young child,” he said.

“We’ve now reached a sad point where some people think naked kids can boost their sales and get them a headline. We will have no role in funding them while they use images that exploit children.”

More than 5000 copies of the magazine have been distributed across Australia. The magazine also includes images by Bill Henson.

In May, police raided the Roslyn Oxley9 Gallery in Paddington, confiscating several images by Henson including the photographs of a naked 13-year-old girl.

The photos sparked major national debate and angered several organisations, including child-welfare groups, with Premier Morris Iemma labelling the works “offensive and disgusting”.

Mr Henson was cleared of any wrongdoing following a police investigation.

A spokeswoman for the Australia Council yesterday defended their decision to help fund the magazine. She said the Council regarded Mr Henson as one of the country’s premier artists.

-With the Sunday Telegraph, AAP

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Singapore and Democracy

Posted by iBlog on July 6, 2008

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Well, what do you expect?

Posted by iBlog on July 6, 2008

FOR the first time since the credit crisis began, the Federal Reserve’s open-market committee decided to keep American interest rates on hold. In a statement released after its policy meeting on Wednesday June 25th the Fed said the dangers to GDP growth had “diminished somewhat” but conceded that the continued rise in energy prices meant the risks of inflation had increased.

This was a shift in judgment, if a subtle one, about where the biggest threat to America’s economy lies. But there was no hint that higher interest rates are imminent. Richard Fisher, the president of the Dallas Fed, was the only member of the ten-strong rate-setting committee to vote for a rise.

After a series of cuts since the summer, the fed-funds rate, at 2%, looks uncomfortably low when set against headline inflation at 4.2%. Yet the Fed seems confident that inflation will moderate. One reason is that higher inflation reflects a jump in the cost of oil and food rather than a broad acceleration in prices. When commodity prices shoot higher, the standard policy response is to treat the resulting rise in inflation as a once-and-for-all shift in relative prices. An interest-rate increase big enough to squeeze inflation back down in short order would cause a needlessly large rise in unemployment.

As long as the public believes the Fed will act to control inflation, today’s price increases are unlikely to feed tomorrow’s wage claims, and a wage-price spiral can be averted. The trouble is, expectations of inflation have started to pick up. A survey by the University of Michigan shows that inflation is expected to be over 5% in the next year, the highest reading since 1982. And expected inflation for the next five to ten years is 3.4%, the highest since 1995. This trend is mirrored in other rich countries. In Britain expectations have risen to their highest level since the central bank’s survey began in 1999. A poll of the euro area, carried out by the European Commission, also shows a rise in the balance of consumers expecting higher inflation.

Until recently, central bankers have looked on the stability of inflation expectations with satisfaction. The public seemed to trust that independent monetary stewards would not be tempted, as politicians might be, to keep interest rates too low to control inflation. But now that faith is in doubt, policymakers seem to be shifting tack. The Fed’s statement referred to a pick up in “some” indictors of expectations but reckoned that this was a sign only of greater “uncertainty” about the outlook. In a speech on June 9th Ben Bernanke, the Fed chairman, admitted to gaps in knowledge about how the actions of central banks affect inflation expectations and how these in turn have a bearing on inflation. Such qualifications are a hint that inflation expectations may have lost their place at the heart of policymaking.

One reason not to worry is that perceptions often differ from reality. Consumers may be overly sensitive to changes in the price of frequent purchases, such as food and fuel, while they overlook the stability of other prices. As the effect of the commodity shock fades, expectations are likely to follow recorded inflation back down again.

If, however, an inflation psychology is returning, not all the rich world’s central bankers appear to be treating it with the same degree of trepidation. The European Central Bank has signalled that it will raise interest rates at its next meeting on July 3rd, to show that inflation remains its main concern. That the central bankers at its American counterpart are sitting on their hands, for the moment, reflects the greater threat of a sharp downturn in the economy there. But if the Fed’s rate-setters are too complacent about rising inflation expectations, they run the risk of squandering the credibility their predecessors earned at such a high price.

Posted in Current News, Finance | 1 Comment »

Starbucks Grounds Zero

Posted by iBlog on July 6, 2008

Jul 3rd 2008 | NEW YORK
From The Economist print edition

FOR years it seemed that American consumers’ demand for liquid fuel was price inelastic—whether it was to drive their cars or get their brains going in the morning. Yet $4 seems to have been the price at which demand becomes elastic, for both petrol and a frothy latte. As a result, baristas at Starbucks coffee shops around America are starting to get a taste of what it feels like to be a carworker in Detroit. On July 1st the coffee retailer, based in Seattle, said it would close a further 500 stores in America (in addition to the 100 closures it announced earlier this year), and reduce its workforce of roughly 172,000 by around 7%.

A remarkable 70% of the stores due to close were opened after 2005, which seems to confirm the comment made by Howard Schultz, when he returned to the helm of the company in January, that most of Starbucks’ wounds were self-inflicted. As it expanded at a breakneck pace, the company opened too many Starbucks in subprime locations. But the deteriorating American economy is doing further damage. As a premium-priced supplier, Starbucks is suffering from the same trading down that is sending shoppers rushing from Target to Wal-Mart. McDonald’s, it seems, has perfectly timed its decision to start selling coffee that is pleasant to drink.

Shares in Starbucks are now trading at barely one-third of their peak value from two years ago. Yet, rather than being a sign of panic, the closures may be evidence that Mr Schultz means to return the company to its focus on quality, rather than growth. After closing all its American stores simultaneously for a brief retraining session a few months ago, there are plans for further improvements in the staff’s competence and demeanour, and in the cleanliness and comfort of its shops.

There are also innovations in the works, ranging from healthy smoothies, to a mysterious (and so far unnamed) Italian drink, to further automation. In March Starbucks bought the Coffee Equipment Company, a small outfit that produces a hugely expensive coffee-making machine called the Clover. It is now testing the machines in a handful of its American shops.

Admittedly, there have been some complaints about the introduction of the milder “Pike Place” filter-coffee blend. But on the firm’s popular new customer website, MyStarbucksIdea.com, the main concerns are about the quality of the food sold by Starbucks and, above all, its prices. Encouragingly for Mr Schultz, there are also many positive suggestions, from serving vegan food to introducing a loyalty card, which suggests that plenty of customers still care for Starbucks enough to give him a chance to win them back—recession or no recession.

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Buyout Banks Take Peacemaking Term

Posted by iBlog on July 6, 2008

By Peter Lattman
Word Count: 892 | Companies Featured in This Article: BCE, Penn National Gaming, Citigroup, Deutsche Bank, Home Depot, Goldman Sachs Group, Harman International Industries, Huntsman

A group of banks and buyout firms helped salvage the $52 billion takeover of Canadian phone giant BCE Inc. The compromise closes a year of bickering about how to fund boom-era deals, which may at last help banks begin new lending commitments to corporations and buyout groups.

That follows an amicable agreement the day before, greased by bank lenders’ concessions, to abandon a $6.1 billion acquisition deal for casino operator Penn National Gaming Inc. (See related article.)

In Penn, the banks paid handsomely to free themselves of underwriting $7 billion of unsold debt on which they would have had to …

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Credit Crisis

Posted by iBlog on July 5, 2008

Credit Crisis? Financial Crisis? That’s Nothing!!!!

Are you negative in your bank account? Have funds run low? Just let it slide. Let the structured one’s freak out about it. If your a risk taker and trying to take your company public for an ipo, it’s all going to come with the territory.

Here are some tips to play it cool:

1. Creditors are worthless, they just sit on the phone all day and are trained to read off there scripts on $9 -$10 an hour
2. Fico Scores these days are bull. As an entrepreneur, your credit will be back up like a heart rate machine just have faith
3. When the bank calls you, just buy them time on the phone. Banks know the game and that’s how you do it.
4. Your going to hear a lot of comments from the outsiders. Just ignore ’em they won’t get it anyway it’s who they are.

When the economy is low, now is never a better time to grow!!!

How to take advantage of the moment while the moment lasts…

1. Look closer at your business. Think of ways that you can improve on what could be better re: team, strategy, sales, etc.
2. Start a new business. Now is never a better time, the economy profits well from new business development so why not?

Don’t be so trusting…

A wise business man knows that trust takes time. Laying out all your cards is a no no.

Ideas, ideas, ideas…

Share the good, protect the great babies with your heart and soul.

Business owners have a ball together…

Why not? They work hard and play hard. They are very creative and the fun in the game is contagious.

Careful what you wish for because it may just come true!

What happens when you are looking for something and that something is just there for the taking. Be safe, because it’s gonna happen fast. Always have a back up plan when things may emplode.

At the end of the day, it’s all a big game

True but not so true, its the attitude and how you play the game in what counts.

Drive, Ambition and Passion are your powers. They come along way…Use them wisely

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Russia’s New Leader

Posted by iBlog on July 5, 2008

Mevedev, A Putin “Prodigy”… Born To Lead?

Vladimir Putin has appointed Mr. Medvedev, Moscow’s new Russian President has won the electorial election by a large marginal vote. Mr. Putin will stay on as prime minister, with there relationship remaining at close end. Power of president is hiearchy and Russia is known for it’s highly personal political system that has been molded by former Putin. Mr. Putin will now take the reigns as prime minister and no longer will be in charge of controlling Russian army as well as foreign policy.

Mr. Medvedev is challenged with some highly significant decisions that will not only impact Russian economy but will also impact ties with the United States. Questions from the public tend to arise on whether Mr. Medvedev will take control of Russia’s foreign political affairs that have been quite political in ties to the Kremlin.

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Anything Can Be Possible

Posted by iBlog on July 5, 2008

Moving Ahead, Why Anything Can Be Possible!

In today’s competitive society and all the negativities, the stressors involved, it is common human nature to fall short with worry and doubts. Having the proper emotional intelligence and the ability to think forward that “Anything can be possible” is positive for cultivating growth, inner strength and continuous progression through life. We learn through experiences, we learn through others and we learn for ourselves. There are many books, human nature of conversations that are expressed on ways and techniques. But in the end, it is only to your own making that anything can be possible if you possess the proper mental efforts.

Thinking bigger, and bigger and BIGGER…

Staying small is one’s own choice, however we cannot grow if we do not put in risk. Risk taking can frighten many people. Whether they are simply too set in there ways, or naturally uncomfortable, undesired to grow. Practicing risk taking behavior is supported to moving ahead in life. It is how you view the experience, take it in, look back and revisit these experiences, learn from them and move on. Repeating the cycle is unhealthy, takes out of your precious personal time and remember that we only have one life so it is to one’s own choosing how to live it well.

Pessimistic Views on Life…

Why it won’t…Why it can’t? How many times and rehearsed conversations from people have we heard that this won’t work because…or I am not able to because…Perhaps it was just a bad day or perhaps we are simply just acting out in ways why it won’t work. “No” is a regular response to these type of people. They have trouble imagining and visualizing. They are the types whom see failure as a predictable option. Fear and doubt create worry among these types. In the end, there isn’t enough of a mental climate to create something positive. Pessimistic views tend to down play on the dreams, the ideas and creativity.

Optimistic Views on Life…

Possibility Thinking is focused on problems and ways that are positive. Dreamers of sorts. They see the “Anything Is Possible” point of view and keep working past experiences “Turning Water Into Wine.” They are the ones who strive to achive, climb mountains, adventure, experience and explore. In a sense, a full life, resilience of never giving up one’s dream. Success thinking in optimism makes anything possible.

Positive outcomes with optimistic thinking result in the following:

Overcoming Inferiority
Living Confident
Challenges To Problems
Facing Lifes Personal Battles
Evaluating Ideas

What type of life do you want to create?

When you are putting your life together we look to believe in creating success in career, in marriage, in family and in friends.

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Interpersonal Leadership

Posted by iBlog on July 5, 2008

Interpersonal Skills for Leadership

Possessing the skills to being effective in interpersonal communication are essential for success in leadership.

Having the ability to be in command of one’s life, relating well with other people and to lead other’s in positive direction is valuable in today’s economy.

Measuring success has the effect of being able to deal with different people whom we exchange information with.

Great interpersonal skill development is something that can make both leaders and followers as well as the lives that they interact with less stressful and of value through possessing the ability to deal well with every kind of people.

Having the ability to listen well, act with vision and commitment, value in yourself and capabilities, handling stress, communicating with trust and empathy, leading wisely and to value others is time well spent.

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Integrity and Influence

Posted by iBlog on July 5, 2008

Integrity & Influence

When you influence others, you gain their spport and have the ability to change their thoughts or actions in some way. Influencing with integrity differs from manipulation in that the former occurs with the influencee’s awareness and consent to be influenced, either expressed or implied.

Influencing with Integrity

1. Influence is situational
2. Influence is a process not an event
3. Influence involves a mixture of tactics
4. Influence is bilateral

Psychology of Influence

1. Authority
2. Similarity
3. Liking
4. Scarcity
5. Commitment and Consistency
6. Reciprocation
7. Social Proof
8. Logical Proof

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Understanding Individual Differences

Posted by iBlog on July 5, 2008

Understanding Individual Differences

Great interpersonal skills takes being sensitive, appreciating and honoring differences among people.

Being aware of the many different ways individuals can be different in how they perceive themselves and how they view the world, process information and make decisions.

Being willing to accept those differences without evaluation and to adopt one’s own style and behavior to adjust to the styles and behaviors of others.

Sensitivity to Differences

Global consulting requires consultants to be sensitive to differences in cultures as you work together with different clients around the globe. Being sensitive means being highly aware of different traditions, cultural ways, language meanings, customs, gestures and so on. These differences are sometimes visible and sometimes concealed. Be aware of words, meanings as there are differences that should be honored. After becoming aware of differences it is important to honor them by assuming that their perspective is valid by not placing judgement to others by cultural norms, respecting differences and developing mutually respectful working relationships.

Understanding Individual Differences

Being able to understand how people are different is important for various reasons.

It helps us to understand that our own attitudes, interests and perspectives as well as needs are important.
It legitimizes the different ways people approach problems.
It shows areas of potential misunderstanding and conflicts.
It helps us adapt our styles so that we work effectively with others.

There are four different ways of interacting with others:

Highly assertive, low on responsiveness. Results and accomplishment oriented. Comfortable in power, move quickly.

Low on assertiveness, response. They are organized, need to be accurate and task oriented.

High on assertiveness and responsiveness. They are involved, idea oriented, people focused.

Low on assertiveness, high in reponsiveness. They need cooperation and avoid conflict. People oriented.

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How People Are Different

Posted by iBlog on July 5, 2008

How People Are Different

Introverts are focused inward, self reflective
Prefer quiet and time for concentrating
Drained by continuous interaction with others
Likes to work alone
Prefers to write out ideas before discussing them
Reluctant to socialize
More difficult to engage in sustained conversations
Disturbed by interuptions

Expect them to be less communicative during team meetings. Give them work they can do by themselves. Work that requires reflection and concentration. Allow them to write out ideas before presenting them. Avoid interrupting them unecessarily. Make social interaction safe for them. Be patient, a good listener.

Focused outward, human interaction
Like variety and action
Enjoy having people around
Enthusiastic communicators
Often think out loud
Discuss topics before committing anything to paper
Enjoy work involving interactions with others
Action oriented
Uncomfortable with lengthy discussion

When dealing and working with extraverts, create a social environment for doing the work. Set up teams or task forces, scheduling meetings where topics can be discussed. Give action, assignments and encourage them to participate in data gathering or problem solving. Involve them in group brainstorming and planning sessions. Use their presentation skills and interactive skills. Avoid asking them to work alone on long projects.

Sensors value facts and reality, practical
Down to earth dimeanor
Factual and usually good detailers
Concerned about the specifics
Concerned about what words
Comfortable fine-tuning something that already exists
Want to reduce risk
Want to be shown why something makes sense
More interested in applications than theory

Be specific and factual. Provide evidence to support conclusions. Avoid asking them to accept something on faith. Make recommendations practical and feasible.  Outline plans step by step. Provide specific examples and anecdotes from experience. Pay attention to risk and show how to reduce or manage it. Use common sense.

Intuitors value imagination and inspiration, visionary
Oriented toward the future and toward possibilities
Disregards facts, makes factual errors
Thinks about the big picture
More interested in theory than applications
Enjoys learning new skills
Seem restless
Works in bursts of energy
Are visionary and follow their inspirations
May not be able to explain their rationale

Use their ability to make leaps of faith. See the big picture to generate original approaches and creative solutions. Challenge the status quo with them and trouble shoot systems, processes that need to be improved. Avoid overloading them with details. Ask them to theorize. Think about possibilities. Allow them to daydream.

Logical, objective and analytical
Analytical and objective
Tends to make impersonal decisions
May not consider impact on people
Focuses on the principles behind the decision or plan
Tends to be firm minded
May be critical
Appreciated a well organized presentation
May seem insensitive to others

Be logical, analytical and objective. State the principles involved. Be well organized and proceed logically from point to point. Support your conclusions with analysis and data, use graphs. Ask them to review and assess your own analyses. Remind them of the human impacts of decisions.

Subjective, concerned with feelings and values
Concerned about how decisions effect people
Allows decisions to be influenced by what people like/dislike
Has trouble delivering bad news to others
Often appreciative and personable
Illogical, values harmony over logical conclusions
Open and forthright
Empathic and good listeners

Show concern for the effects of plans, decisions on other people. Be responsive to them. Use their interpersonal and communication skills to build teams and relationships. Ask them to evaluate how people will respond to a decision. Use them to determine what’s most important. Use them to balance your own perceptions and to factor in the human elements of a situation.

Need for closure and decide quickly
Want things settled and finished
Very decisive
Makes decisions too quickly
Impatient with lengthy discussions
Want to see things structured and scheduled
Very good time mamangers
Insist that others be as punctual and controlled
Dislike surprises
Organized and focuses on tasks to be done
Make and use lists

Be as time conscious as they are. Start and end meetings on time. Structure your decisions. Be organized and systematic in your reports and presentations. Make your materials neat. Move through your agenda and proceed to decision making as quickly as possible. Avoid surprising them, last minute changes. Use them to manage time and to make lists. As for their assistance in project management.

Prefer spontaneity and like to keep options open
Uncomfortable with tight deadlines
Flexible and adaptable
Leaves things open
Expects last minute changes
Open to exploring new approaches and alternatives
Focus more on process than results
Postpone decisions in order to gather more information
Searched for more options
Uncomfortable with time management
Spontaneous, spur of the moment

Be flexible and adaptable. Show a willingness to explore new possibilities. Gather additional information, incorporate new ideas. Avoid giving them tight deadlines. Be process focused. Use them on teams exploring new possibilities. Be patient, don’t have expectations for them to be good time managers. Accept their spontaneity and go with it.

Fundamental Needs

The need for power
The need for affiliation
The need for achievement[

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Gas Price Surge America

Posted by iBlog on July 5, 2008

Gas Price Surge In America

Gasoline consumption in America has fallen by an average of 1.1% This in combination with the economy today, has made a dramatic after effect on American behavior, overall American consumer behavior, driving habits and lifestyle changes. Since February of 1994, gasoline prices have been on the rise. Costing Americans on average around $3.00 to $3.59 per the gallon rising to almost $4 potentially per the gallon, it is no wonder that we are pushing the “green movement” for an eco-friendlier economy of today. With the continuing rise of oil prices that are pulling gasoline higher in the current economy, American consumers are more likely to hold back on buying gas prices. Today’s weak economy has led Americans to cut back on driving, instead taking public transportation to avoid rising costs of fuel. As a result, the demand for gasoline has slowed with Americans becoming more fuel-efficient.

As consumers are wise spending decisions as result of economy downturn on where to live, what kind of car, what kind of “eco friendly” car, they begin to factor in more intelligently fuel costs, typical consumer spending behavior on goods and services as well as overall impact in every day cost expenses. We are beginning to see hybrid cars, compact cars pushed to market. Automotive changes in choice of car, have a significant impact on the obvious level of gasoline consumption rates which we have seen over the past years however significantly more so as we move toward a more “fuel efficient”, “eco-friendly” lifestyle. Behaviors such as consumer shopping at Wal-Mart, trading in the automobile rides for bicycle rides has left American’s concerned now with an impact on consumer behaviors due to gas price rates rising high, how the American people will be living in the future. Examining the downturn of the economy, the decline in the real estate market has also made significant impact on how we are living today. Real estate developers are building more walkable neighborhoods closer to public transportation and public shopping centers. It’s all about saving in the new economy. Rising gas costs, concerns of commuting, real estate market impacts and retail consumer behavior have certainly made its mark in today’s world.

Convenience is key. 0% The outlook of the future of today’s economy has impact on how much money individuals earn. If earnings stay high, then consumers will obviously keep spending and keep the economy growing. Consumer spending effects 70% of today’s economic output. The recession of 2001 did not impact consumer spending slowdown even through income growth had declined.

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Communicating Effectively

Posted by iBlog on July 5, 2008

Communicating Effectively

To communicate so that others hear you is crucial. Listed below are some key facts:

1. All human beings are self absorbed, there attention is selective and care most about what effects them
2. Human beings are not information processors. Everything that they sense is based on emotions, values, needs
3. Words and there meanings are a small part of any message
4. People will not hear you unless they are attending to you
5. To communicate effectively you must be credible, interesting, relevant
6. Keep things simpls, concrete and memorable
7. Have a bottom line approach
8. Elaborate, give specifics
9. Time awareness, keep it short
10.Summary, reinstate key points
11. Ask questions, avoid why, information point, staccato questions
12. Open questions, closed questions

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China One Child Nation

Posted by iBlog on July 5, 2008

China and it’s “One Child” Nation

China easing back on rules? In Beijing, China is currently has a restriction of family planning policies which have most urban couples in China to conceive only one child. The policy was launched in 1973 in response to the significant amount of birth rate that has left it’s population out of control. During the cultural revolution, China’s birthrate had soared that had reached an outrageous amount of a ratio as high as 5.8 children per couple. This then created worries in the country’s limitations of basic needs such as food, water and energy resources.

China today has decreased birth rates down to 1.8. It is possible that social difficulties are to arise in the future as there will be fewer younger adults that create social difficulties in the future. The future shift in China’s “One Child” policy will have little impact future prediction on change of controls. In the year 2033, it is predicted that China’s population is still growing. In reports, the year 2033 China population will hit a significant number of 1.5 billion people, leaving birthrates to soar in the next five years.

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California Beef Recall

Posted by iBlog on July 5, 2008

California Beef Recall

Animal Cruelty, a root cause of the California Beef Recall has lead American’s questioning even more the sanitary and humanitary well being of consumer lives and meat consumption. Last year in California, a law was passed allowing consumers to have access to the names of retailers that received products involved in all recalls. The company, Hallmark/Westland meat was issued a recall of 143 million pounds of beef earlier this month after the Humane Society had issued an undercover video that showed workers forcing sick and injured cows to stand up using fork lifts and high pressure water hoses. Mr. Herrera was held in police custody, was faced with felony charges of animal cruelty for moving these forced or injured cows that could not walk nor stand.

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Political Gridlock & Tokyo Stocks

Posted by iBlog on July 5, 2008

Japan is the world’s second largest economy. In 2008, the Nikkei Stock Average is down 19% for the year. Economist’s comment that the 19% drop of the Japan’s dollar’s steep decline would help the United States reduce its huge trade deficit and eliminate the United States $2 billion dollar a day addiction to foreign capital. After falling for the first time since 1995, Japan’s slide has created a host of problems worldwide for both the United States and Japan. In retrospect, the decline could help the United States reduce its huge trade deficit.

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India’s Economy Hits The Wall

Posted by iBlog on July 4, 2008

Just six months ago, India was looking good. Annual growth was 9%, corporate profits were surging 20%, the stock market had risen 50% in 2007, consumer demand was huge, local companies were making ambitious international acquisitions, and foreign investment was growing. Nothing, it seemed, could stop the forward march of this Asian nation.

But stop it has. In the past month, India has joined the list of the wounded. The country is reeling from 11.4% inflation, large government deficits, and rising interest rates. Foreign investment is fleeing, the rupee is falling, and the stock market is down over 40% from the year’s highs. Most economic forecasts expect growth to slow to 7%—a big drop for a country that needs to accelerate growth, not reduce it. “India has gone from hero to zero in six months,” says Andrew Holland, head of proprietary trading at Merrill Lynch India (MER) in Mumbai. Many in India worry that the country’s hard-earned investment-grade rating will soon be lost and that the gilded growth story has come to an end.

Global circumstances—soaring oil prices and the subprime crisis that dried up the flow of foreign funds—are certainly to blame. But so is New Delhi. Much of the crisis India faces today could have been avoided by skillful planning. India imports 75% of its oil to meet demand, which have grown exponentially as its economy expands. The government also subsidizes 60% of the price of such fuels as diesel. In 2007, when inflation was a low 3%, economists such as Standard & Poor’s Subir Gokarn urged New Delhi to start cutting subsidies. Instead, the populist ruling Congress government spent $25 billion on waiving loans made to farmers and hiking bureaucrats’ salaries.

Botched Opportunities

Now those expenditures, plus an additional $25 billion on upcoming fertilizer subsidies, is adding $100 billion a year—or 10% of India’s gross domestic product, or equivalent to the country’s entire collection of income taxes—to the national bill. This at a time when India needs urgently to spend $500 billion on new infrastructure and more on upgrading education and health-care facilities. The government’s official debt, which dropped below 6% of gross domestic product last year, will now be closer to 10% this year. “Starting last year, the government missed key opportunities” to fix the economy, says Gokarn. In fact, he adds, “there has been no significant reform done at all in the past four years”—the time the Congress coalition has been in power.

Even the most bullish on India are hard-pressed to recall any significant economic reforms made in the recent past. A plan to build 30 Special Economic Zones is virtually suspended because New Delhi has not sorted out how to acquire the necessary land, a major issue in both urban and rural India, without a major social and political upheaval. Agriculture, distorted by fertilizer subsidies and technologically laggard, is woefully unproductive. Simple and nonpolitical reforms, like strengthening the legal system and adding more judges to the courtrooms, have been ignored.

A June 16 report by Goldman Sachs’ (GS) Jim O’Neill and Tushar Poddar, Ten Things for India to Achieve Its 2050 Potential, is a grim reminder that India has fallen to the bottom of the four BRIC nations (Brazil, Russia, India, and China) in its growth scores, due largely to government inertia. The report states that India’s rice yields are a third those of China and half of Vietnam’s. While 60% of the country’s labor force is employed in agriculture, farming contributes less than 1% to overall growth. The report urges India to improve governance, raise educational achievement, and control inflation. It also advises reining in profligate expenditures, liberalizing its financial markets, increasing agricultural productivity, and improving infrastructure, the environment, and energy use. “The will to implement all these needs leadership,” points out Poddar.

“We have a government in New Delhi with the best brains, the dream team,” he says, referring to Oxford-educated Prime Minister Manmohan Singh and Harvard-educated Finance Minister P. Chidambaram. “If they don’t deliver, then what?”

Disillusioned Business

More worried than most are India’s businessmen, who have turned in stellar performances with their investment and entrepreneurial drive and begun to look like multinational players. For them, there’s plenty at stake. But lack of infrastructure, from new ports to roads, along with an undeveloped corporate bond market and high prices for real estate, commodities, and talent, are causing them to hit “choke points and structural impediments all over. We will lose years,” says Bombay investor Chetan Parikh of of Jeetay Investments.

Sanjay Kirloskar, chief executive of Kirloskar Brothers (KRBR.BO), a premier $470 million maker of water pumps, already has $100 million in overseas contracts. Yet few infrastructure contracts have come from New Delhi. Kirloskar had hoped to be part of a grand project linking India’s rivers, but those plans have been on hold for four years. “The infrastructure growth we had hoped for has not come about,” he says. “Instead, we will now expand overseas more than in India.”

Such constraints on growth at home will have an impact. Corporate earnings growth is likely to dip, says Merrill Lynch’s Holland, who now predicts just 10% growth, instead of the previous year’s 20%. That slowdown makes it less attractive for foreigners to invest in India’s stock market. Already this year, foreigners have taken $5.5 billion out of the market, compared with the $19 billion they invested last year. Gagan Banga, chief executive of India Bulls Financial Services, an emerging finance and real estate giant, points admiringly to China’s ability to maintain its growth momentum for a decade, while India’s has not been able to hold up for even three years. “Serious companies are going to grow at a much slower pace, and some may even de-grow this year,” he says. Unless major policy decisions are made by New Delhi immediately to keep the economy on the growth path, he says, “India will slow down even further.”

New Delhi defends its four year reign in India. “We’ve had 9% growth for four years in a row,” says Sanjaya Baru, media adviser to Prime Minister Singh. “That is unprecedented.” He attributes it to the increasing rate of investment, up from 28% of GDP to 35% currently, “close to most ASEAN economies,” though he admits that a large part is from the private sector. “Yes, there is a fiscal problem, but there’s a price to be paid for coalition politics,” adds Baru. So having growth drop “from 9% to 7% is not grim.”

Social Backlash?

Chetan Modi, head of Moody’s India, says the increasingly high cost of doing business in India may force global investors who had set up base in India—especially financial-services players—to move to more affordable and efficient hubs, such as Singapore and Hong Kong. If the economy slows and inflation continues to accelerate, says Sherman Chan, economist at Moody’s Economy.com, “social unrest is possible.”

In fact, India is becoming a dangerous social cauldron. The wealth harvested by the reforms of previous governments has made itself evident in the luxury cars and apartments in India’s big cities, leaving much of India full of aspirations but few means to achieve them. There is a severe shortage of colleges, yet a plan to build 1,500 universities gathers dust. The Communists in the ruling coalition are against both globalization and industrialization, so without new factories being built, employment growth has been almost stagnant, rising to just 2%—a disappointing rate in a country where an estimated 14 million youths enter the workforce every year, but just 1 million get jobs in the regulated, above-ground economy.

Meanwhile, few expect any bold moves New Delhi, especially with national elections due in 2009 and five important state elections scheduled before the end of this year. Thus far, the ruling Congress party’s record has been poor; it has lost almost every state election this year and is likely to lose all five of the upcoming ones.

The big hope for a return to the course of reform in India, businessmen hope, will be a new government in New Delhi next year. The gravest danger is that India’s messy coalition politics will bring into power another indecisive alliance that will keep the country in policy limbo for another five years. If so, says S&P’s Gokarn, it’s a meltdown scenario: growth slipping below 6.5%, accelerating the chances of India reverting to its 1991 status when it was plunged into a balance-of-payments crisis.

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