Table On-Topic Summary - 06-Oct-2002
A compilation of this board's financial/economic posts From 43250 to 43263



Post  43250  by  clo       Reply
srudek, this is but a snippet. Thought you would enjoy. clo

De facto dollar-pegged strategies have proved inadequate given diverse trade patterns, greater capital mobility and independent monetary policies in each country.

In the mid-1980s, many emerging market economies started to move towards more flexible exchange rate regimes. However, several major Asian economies kept a regime virtually pegged in nominal terms against the dollar. This regime was chosen for two reasons: first, to ensure price stability, and second, to make foreign finance available at a cheaper rate by means of bank loans, portfolio and foreign direct investment with reduced interest rate spreads. Exchange rate pegs had a twofold positive effect on interest rate spreads by curbing inflation expectations and sustaining market operator confidence, thus reducing the country’s overall risk.

http://www.mof.go.jp/english/asem/aseme03e.htm







Post  43251  by  clo       Reply
Anyone Seen Any Democrats Lately? (Not me! clo)
By THOMAS L. FRIEDMAN NY Times

Ever since President Bush took office I've had this feeling that the only serious opposition party in America, at least in foreign policy, was made up of three people, and none of them were Democrats. The only three people Mr. Bush really worries about — the only three people who could take big constituencies with them if they openly parted company with the president on an issue like Iraq — are Colin Powell, Tony Blair and John McCain.

What happened to the Democrats? Well, I don't buy their whining that their voices have been cynically drowned out by Mr. Bush's focus on Iraq. The problem with the Democrats is not that they are being drowned out by Iraq. The problem is that the Democrats have nothing compelling to say on all the issues besides Iraq. Iraq is winning control of the agenda by Democratic default, not by Republican design.

I spent the last month traveling the country on a book tour, during which I said that what worried me most after 9/11 was what kind of world my girls were going to grow up in. I ran into so many Americans who share that concern. After a talk in Atlanta, one guy came up to me, just opened his wallet and showed me the picture of his daughter. He didn't say a word.

The point is that I can assure the Democrats that while Mr. Bush may be obsessed with Iraq, most Americans are worrying about their jobs, the stock market, the environment and the fact that their kids may not grow up in as open and peaceful a world as they did.

The biggest security concern of Americans today is not Iraq or Osama. It's the fear that America itself could be weakened by short-term, greedy decisions, taken by politicians squandering our hard-won surplus or corporate executives squandering our pensions and undermining our markets. And Americans are right to be concerned. Because without a strong America holding the world together, and doing the right thing more often than not, the world really would be a Hobbesian jungle.

Because I believe that is what is really gnawing at Americans, and because I believe that Mr. Bush is not really addressing this broader concern — but is still running on the momentum of his strong military performance right after 9/11 — there is a leadership opportunity for bold Democrats. But where are they?

Where are the Democrats who are ready to argue forcefully that the future tax cuts that Mr. Bush pushed through are utterly reckless and need to be repealed — because they will erode the resources the government needs to remain a Great Power in this age of uncertainty? And they send a terrible signal to our kids, corporate leaders and the world: that all that matters is short-term, me-first gratification.

Where are the Democrats who would declare that the best way to enhance our security, make us better global citizens, reduce our dependence on Middle East oil and leave a better planet for our kids is a Manhattan Project to develop a renewable energy source, along with greater conservation? Mr. Bush has totally ignored the longing by young Americans to be drafted for such a grand project to strengthen America. And so, too, have the Democrats.

Where are the Democrats who would declare that confronting Saddam is legitimate, but it must not be done without real preparation of the U.S. public? Decapitating Saddam's regime will take weeks. Building Iraq into a more decent state, with a real civil society, will take years. But it is this latter project that is the most important — the one that really gets at the underlying threat from the Middle East, which is its failed states. But do we know how to do such nation re-building, and if we do, do Americans want to pay for it? We need to go in prepared for this task (which is unavoidable if we really intend to disarm Iraq) or stay out and rely instead on more aggressive containment, because halfhearted nation-building always ends badly and would surely weaken us. Why aren't the Democrats clarifying this?

At the moment, the Bush team is leading the nation much more by fear than by hope. The Democrats can only win, or only deserve to win, if they can offer a bold alternative. That would be a program for strengthening America based on hope not fear, substance not spin, a program that addresses the primary concern of Americans now: the future for the kids whose pictures they carry around in their wallets.






Post  43252  by  clo       Reply
AL-MUKALLA, Yemen (CNN) -- A French oil tanker is ablaze off of Yemen after being blasted in a terrorist attack, French officials have told CNN.

A small boat carrying explosives hit the tanker Sunday in an attack that appears to be a copy that carried out on the USS Cole two years ago, a French embassy official here said.
The Limburg, which was carrying about 400,000 barrels of crude oil, was approaching the port of Al-Mukalla in the south east of the country to pick up more cargo when the blast occurred. It had been on its way from Iran to France.
About 11 members of the ship's 25-strong crew are still fighting the flames onboard the vessel.
Other crewmembers jumped overboard and were picked up by rescuers. It is not known which company owns the ship.
Yemeni authorities have been helping the FBI in trying to stamp out terrorist networks.
Seventeen U.S. sailors died in a blast that nearly destroyed the U.S. destroyer during a refueling stop at Aden port two years ago, in an attack blamed on Osama bin Laden's al-Qaeda terror network.

http://www.cnn.com/2002/WORLD/meast/10/06/yemen.ship/index.html





Post  43253  by  srudek       Reply
maniati: monetarism question

I ran into the following passage and quote of Milton Friedman:
"The father of monetarism, Milton Friedman, made a similar argument in a recent interview with Central Banking magazine. 'There is no chance of entering into a deflationary world,' argued the venerable economist. 'Central banks have finally learnt that the cure for deflation is printing enough money and the cure for inflation is not printing too much money.'

Japan's experience, as some economists point out, suggests that things are not always quite so straightforward, however. Monetary policy works well when the mechanisms through which it is transmitted are functioning well, and chief among these mechanisms is the banking system.


My question: Is Friedman's quote to be taken seriously? Frankly, his comment seems less-than-thoughtful -- actually stupid -- to me. I know he's not a stupid man. If this is an accurate snapshot of monetarism than I have no hesitation in throwing IT in the scrap-heap of stupid ideas. My reasoning? It's obvious to me you can print all the money in the world, but unless someone is actually willing to "borrow" it (take on debt and interest obligations in order to use it), it will make no difference whatsoever. I can easily imagine a world in which, even at zero percent interest, nobody who was a good credit risk would be willing to borrow any more. Now, the government could "borrow" it -- deficit spend some more or just monetize private debts -- but common sense says that would be a road which you could only take so far . . . not likely near far enough to clean up all the excess debt we have weighing us down.

Hopefully Friedman just went way overboard in simplifying "monetarism"?




Post  43254  by  clo       Reply
Chips With Muscle Set Off a Market Tug of War

By WILLIAM J. HOLSTEIN

In the early 1990's, Sabrina Kemeny was among the researchers at NASA's Jet Propulsion Laboratory in Southern California who made spacecraft smaller and cheaper. The key was discovering how to build an optical sensor on a single semiconductor, allowing for smaller components that consumed less power.

"That was the breakthrough," Ms. Kemeny recalled. "It was a dislocating kind of technology."Ms. Kemeny and a handful of colleagues were so excited about the photographic applications of this semiconductor that in 1995, over a kitchen table, they created a company to design it for other companies.

But their start-up, called Photobit, lacked the size and capital to go ahead and make this "camera on a chip," a type known in the semiconductor industry as a CMOS (pronounced SEE-moss), which stands for complementary metal oxide semiconductor.The destiny of Photobit changed nine months ago, when Micron Technology, the large semiconductor maker based in Boise, Idaho, bought the company and renamed it Micron Imaging. Ms. Kemeny is director for technical marketing there.

That decade-long journey from the laboratory is part of a new race in the chip industry, where growth in demand has been disappointingly slow for nearly everything. A notable exception is the photographic applications of CMOS.

These chips are responsible for products that are just beginning to reach consumers — including cameras within cellphones, cameras in tiny capsules that can pass through the body to diagnose disease and tiny cameras mounted on personal computers.
The chips have many other uses in security systems and industry.

Unlike the technology bubble of the late 1990's, a time when fanciful dot-coms without real products raced to overpriced initial public offerings, the race to dominate the market for cameras on chips is an old-fashioned kind of technology battle:
Real companies are vying to invent real products that touch millions of consumers.The older technology that CMOS is beginning to displace is called the charge-coupled device, or C.C.D., invented at Bell Labs in the late 1960's and first used in products like fax machines. The C.C.D. uses passive sensors, or tiny eyes, that detect light.
An outside source of power is required to get the image from the devices, and other circuitry is needed, too. That makes them relatively big and expensive.

CMOS chips, by contrast, consist of active sensors that have tiny transistors as power sources. Because of the way CMOS chips are made, sensors and many other processing functions can be placed on one chip.CMOS technology greatly reduces the amount of power used, allowing batteries to last longer in hand-held devices, but it also provides photographic image quality almost as good as that of charge-coupled devices.

N-STAT/MDR, a Scottsdale, Ariz., unit of the Reed Elsevier Group, a publishing and industry research company, says the number of CMOS chips made each year will triple from current levels by 2006. But In-Stat/MDR said sales, which totaled $1.2 billion last year, were expected to rise only to $1.6 billion in 2006 because the price of each chip would decline as production accelerated. Micron and others define the market more broadly, putting its potential at $4 billion in annual sales.
Whichever figures are correct, it's clear that solid growth is occurring in one area of the otherwise depressed semiconductor industry.
Micron, a relatively late entry to the field, has tried to leapfrog toward the front with the technology expertise gained from buying Photobit.
Three other major American companies are also in the battle. Agilent Technologies, a Palo Alto, Calif., spinoff of Hewlett-Packard, learned from the published research on CMOS done at the Jet Propulsion Laboratory in the 90's. Its biggest customer is Logitech International, of Fremont, Calif., which makes PC cameras for Dell Computer and others.

The two other companies, Eastman Kodak and Motorola, started a technology alliance in 1997 that makes and sells CMOS chips. The Kodak-Motorola unit sells chips primarily for industrial uses like machine vision, but also for some Kodak digital still cameras.
Two Japanese competitors, Toshiba and Sharp, which have developed their own CMOS manufacturing processes, are generally believed to have a significant advantage. If there is a top potential application for the chips, it could be teenagers' swapping of pictures on their cellphones — already a pastime in Japan.
Because Japan has more advanced network systems for its cellphones, service providers like J-Phone can offer camera-equipped cellphones from different Japanese manufacturers.On long subway and train rides, teenagers while away the time by snapping pictures of their companions and transmitting them to other friends on their phones. "The target market is a 15-year-old Japanese girl with pink hair and a cellphone," said Shawn Maloney, director of marketing for Micron Imaging. "The whole world is watching Japan."The fact that Japan's chip makers sell to handset manufacturers who, in turn, sell to service providers could give them an important edge, particularly if the market takes off as expected. "Right now, the leaders for CMOS telephones are in Japan," said Brian O'Rourke, a senior analyst at In-Stat/MDR. "Toshiba is probably the leader."South Korea is also ahead of the United States in cellphone sophistication, and a Korean company, Samsung Electronics, is a major CMOS competitor.

In late September, Samsung formed a CMOS manufacturing alliance with Mitsubishi Electric of Japan.In the United States, a moment of truth may be at hand for CMOS. Several wireless service providers like Sprint PCS and Cingular Wireless offer small cameras that can be attached to cellphones to take pictures and transmit them. But Sprint PCS is expected to start marketing a Samsung mobile device with an embedded camera in time for the Christmas season.
Nokia of Finland is pushing its camera-equipped cellphone, and an alliance of Sony of Japan and Ericsson of Sweden known as Sony Ericsson Mobile Communications says its camera phone will hit the United States market in the fourth quarter.
UNDERLYING cellphone networks are still slower in the United States than elsewhere, but consumers can still capture single still images in color and transmit them. All these new devices use CMOS. "We have a lot of hopes for this product," said Jason Hartlove, vice president and general manager of Agilent's sensor solutions division.
Manufacturers are shipping nearly 400 million cellphones worldwide each year, and Mr. Hartlove expressed hope that a growing number would include CMOS-based cameras at an additional cost of about $5 each.
Aside from finding uses for CMOS, the manufacturers are also trying to make the chips more efficiently.
That is where Micron hopes to excel. It is the only American maker of dynamic random access memory, or DRAM, chips, a basic in consumer electronics. Micron survived a battle with the Japanese in the 1980's, only to watch as Samsung Electronics became No. 1 in the world in DRAM chips.
Micron had sales of $2.6 billion in the fiscal year ended Aug. 29, down from $3.9 billion the previous year. It had a net loss of more than $900 million for the year just ended, largely because of falling prices, but the company has $1 billion in cash and is expected to emerge from the current downturn in relatively strong shape because it has kept a strict grip on costs.DRAM chips are often dismissed as a commodity, but they are a building block of countless electronics devices, including personal computers, personal organizers, set-top boxes, cellphones and game consoles.
They are made in a process similar to that used for CMOS. "Our goal is to leverage our advanced CMOS technology and existing infrastructure to establishing a leading position in the expanding imaging markets," said Steven R. Appleton, the chief executive of Micron.
The company is also betting that marrying its mass manufacturing capability with the best CMOS designs from the technology's inventors will raise the quality of images captured on the chips. Skeptics said "we could never get to the next level of resolution," said Mr. Maloney of Micron. "But we're working our way up the resolution ladder."
Things could still go wrong. Manufacturers could charge too much for their camera phones — Nokia's camera phone, the 7650, is selling for a steep $500 after rebates in Europe. It is also not clear yet whether consumers in the United States will want to snap pictures and send them directly to other mobile devices or to store them first on the Internet.
But after a brutal couple of years in the chip industry, CMOS makers are allowing themselves a measure of hope. Even Kodak, the largest maker of charge-coupled devices in the United States, acknowledges that CMOS chips are improving in quality. Christopher McNiffe, the sales and marketing manager for Kodak's image sensor solutions division, said that "over time, they will clearly become the dominant technology."

http://www.nytimes.com/2002/10/06/business/yourmoney/06CHIP.html




Post  43255  by  maniati       OT: ttalknet: I should probably begin by telling y
Post  43256  by  Decomposed       OT: Table ON TOPIC SUMMARY Oct 05, 2002


Post  43257  by  jeffbas       Reply
SR, what do you think would happen to the economy if the government gave the 20M poorest Americans $5,000 each? That would nominally cost $100B, but I bet the positive feed-through the economy would make the cost much less. (That is not a reco, just meant to stimulate thought.)



Post  43258  by  maniati       Reply
srudek: Argh!! I was JUST on my way out the door, and I'm already late because of my last post. So, let me give you the short answer to your question: yes, he was serious. I will attempt to respond more fully when I return.

BTW, excellent question.




Post  43259  by  danking_70       OT: Clo re: Supremes
Post  43260  by  tinljhtkh       OT: Maniati!


Post  43261  by  jbennett53       Reply
maniati, Again you expend many words. My point is and has always been that this country should worry about this country. You can take "Muhammed" and any other stoneage myth that the weak human in fear of death has a belief and place it where it belongs. By our constant meddling in the affairs of others we experience very undesirable consequences. Again my point is that we should have people on the Moon, Mars, cures for cancer, heart disease, energy problems etc. We continue to squander our National Wealth for no good purpose. I remember you saying you were against the Vietnam Police Action. My guess is that you are using hindsight. I was against that atrocity long before it was over. The wealth of Brave American Youth, not to mention the monetary loss was heartsickening. The surprising reality to come from that evil is that the Vietnamese do not hate us even after Bill Clinton laughed in their faces when confronted with a request for help due to damage from Agent Orange. Our use of this sickening weapon makes Saddam look like Pee Wee Herman. Now you wish to continue this evil of killing to "solve" the problem? I assume given your rapid Republicanism that you even feel that "First Use" is acceptable? We are vulnerable to semi or total destruction of our lifestyle and we have currently embarked upon the most certain path to this end. The sad part is that we are using our wealth to speed us on our way. Such a great time it should be for Man, Such angry little atavists running the game. A violent community raises violent children.



Post  43262  by  uponroof       Reply
Global crash fears as German bank sinks

Faisal Islam, economics correspondent and Will Hutton
Sunday October 6, 2002
The Observer

Stockbrokers around the world are braced for a potentially calamitous week as alarm mounts over a looming, Thirties-style global financial crisis. A leaked email about the credit-worthiness of Commerzbank, Germany's third largest bank, yesterday increased fears of the international stock market malaise exploding into a fully-fledged banking crisis.

Commerzbank lost a quarter of its value last week, raising the spectre of Credit-anstalt, the Austrian bank that collapsed in 1931, sparking global depression.

US stock markets have fallen for six consecutive weeks, to their lowest levels in five years. European markets have collapsed even further, wiping out nearly half of the value of European corpora tions in this year alone. Japan is struggling to put together a plan to save its banking system, riddled with bad debt after a decade of recession and falling prices. Now the German economy threatens to follow.

'There are strong parallels to the Thirties after an unsustainable "new era" boom,' says Avinash Persaud managing director for economics and research at State Street Bank. 'Then, the stock market decline was not just steep, it was long, taking three years to reach the bottom.'

'Commerzbank being affected is a sign of the severity. But in today's crisis risks have been offloaded from the banks to the markets and ultimately our pensioners, which makes the problem more difficult to deal with,' he says. The leaked email about Commerzbank was in response to an inquiry from a US investment bank about rumours of huge losses on credit derivatives, which aim to spread risk.

Figures due to be published on Friday will show that a toll of stock market falls, rising joblessness and war fears is finally denting the spending habits of Americans. Economists fear that the result may be a 'double-dip' US recession, taking much of the world with it.

Europe's finance Ministers, including Chancellor Gordon Brown, will meet in Luxembourg on Tuesday amid deepening concern about the stability of the financial system. Tomorrow evening, the Eurogroup of finance ministers, excluding Brown, will discuss reforming Europe-wide tax and spending rules along the lines of the British system, taking stronger account of economic difficulties.

In the US, the concern is that Alan Greenspan, chairman of the US Federal Reserve, has insufficient room to cut interest rates if the economy falls into recession. 'The [Bush] Administration has two lines of action: tax relief for the rich [and] reliance on the Federal Reserve. Both are without effect,' says US economist JK Galbraith in an interview with The Observer.

More on Commerzbank:

Reuters Market News
Commerzbank to axe hundreds more jobs -FT
Sunday October 6, 7:56 pm ET

LONDON, Oct 7 (Reuters) - Germany's third-biggest listed bank, Commerzbank AG, is set to cut hundreds of jobs on top of the 4,300 it is planning to axe by end-2003, the Financial Times reported on Monday.
The paper said the job losses at Commerzbank would follow a review of its corporate activities.

On Saturday, Commerzbank denied it faced financial difficulties after the Financial Times quoted an email from U.S. investment bank Merrill Lynch (NYSE:MER - News) posing questions about its financial health.

A Commerzbank spokesman said the bank may take legal action against Merrill Lynch after a member of the bank's corporate credit department wrote to credit rating agency Standard & Poor's seeking comment on rumours that Commerzbank faced big losses in its credit derivatives business.

"We cannot explain the amount of speculation going on and we see it mainly as provocation from our competitors. It cannot be inferred from the way our business is going," the Commerzbank spokesman said.

**************

uponroof- Everything is based on confidence...that includes Friedman's 'comforting' two cents wrt printing press activity. Once underlying values and and truths are called into question, the entire system, and the prescription of the day (de, dis or in-flation) becomes vulnerable.

The question is will this vulnerability gain understanding, and increased creedance, which will further perpetuate foundational risks? The report above says this is now unfolding in front of our eyes.

Don't expect an 'official' announcement on this 'crisis' as confidence is the primary factor the 'officials' are concerned with. In other words, we won't know what's happened until it's too late.

Hope all have some sort of emergency financial plan already in place. If not, you're taking an enormous unnecessary risk.

Tonight so far the Nikkei is down 300+-. FTSE futures are down 70.....





Post  43263  by  pmcw       Reply
pd, I just got back in town. I'm very glad to hear you and your family are safe, but saddened to hear about losing the live oak. KC area trees were laid to waste by the ice storm last winter. I managed to save a huge flowering crab that sites to one side of our entry in front of our dining room. I've trimmed it through the years to look somewhat like a banzai tree which left if very vulnerable to the weight of ice. It covers the entire walk leading to our front door with some branches extending over 15' horizontally from the trunk. I did just exactly what they said I shouldn't. I used the pole extension from my paint roller and spent most of the evening gently knocking the ice from the branches.

In the back we weren't so lucky. A very large river birch was shredded and a purple plumb was up rooted. However it was small enough that I attached a come-along to it and a huge maple and over the period of a week or two slowly righted it. However, even as a smallish (20' to 25') tree it strained a four ton rated cable.

Majestic trees are certainly special. I love the live oaks around my mom's house in TX. But being safe means you can start again knowing generations to come will appreciate your efforts just as you have those who came before.

Best Regards, pmcw