News and Analysis: 8-12 Mar 10 | EmergingFrontierMarkets.com

Based in: Manila, Philippines

Posted on Fri, 12 Mar 10:

Lehman failure 'fault of managers, banks, auditors': A court-appointed expert has blamed the collapse of investment bank Lehman on its top management as well as audit firm Ernst & Young and banks Citigroup and JPMorgan Chase. The 158-year-old bank filed for protection in Sep '08 in the largest US bankruptcy filing in history. In a scathing 2,200-page report, law firm Jenner & Block chair Anton Valukas accused the senior mgmt of 'actionable balance sheet manipulation' and said they oversaw and certified decisions that exacerbated Lehman's woes, Ag.France-Presse (courtesy inSing[apore]), 12 Mar 10

Regulation of exec compensation in financial services: Many people argue that inappropriate compensation policies in financial firms contributed to the global crisis. Some say the overall level of pay was too high. Others criticize the structure of pay, claiming that contracts for CEOs, traders, and other professionals induced them to pursue excessively risky and short-term strategies. We, a nonpartisan group of finance academics, take the view that govts should generally not regulate the level of exec compensation at fincl firms. Instead, a fraction of compensation should be held back for several yrs to reduce employees' incentives to take excessive risk, Squam Lake Working Group (courtesy Council For. Relations), Feb '10

Boardroom/ C-suite: 'Multilatinas' - New breed of companies reshaping LatAm biz landscape--A hundred high-performing Latin Amer cos. are expanding their operations internationally w/ impressive ingenuity and sophistication, adopting approaches that may offer valuable lessons to others, acc to a recent report Multilatinas '09. A $100 investment made in June '99 in a hypothetical multilatinas index would have grown at a compound annual growth rate of 19% to be worth more than $560 in '09, Boston Consult. Grp, 3 Sep 09

Posted on Thu, 11 Mar 10:

The world's billionaires--Bill Gates no longer world's richest man: Riding surging prices of his various telecom holdings, incl giant mobile outfit America Movil, Mexican tycoon Carlo Slim Helu has beaten out Americans Bill Gates and Warren Buffett to become the wealthiest person on earth and nab the top spot on this yr's list of the world's richest people. And for the 1st time, China (incl Hong Kong) has the most billionaires outside the US w/ 89, while Russia has 62. Also, 11 nations have at least double the no. of billionaires they had a yr ago, incl India, Turkey and SKorea, Forbes, 10 Mar 10

Dominique Strauss-Kahn: Reject ad hoc, national financial reforms--National financial systems are part of a larger global network. While there is a process of collaboration to bridge the problem of local regulators dealing w/ global banks, many nations are approaching bigger-picture reforms from different directions and at different speeds. In the process, a central lesson of this crisis is being forgotten: that coordination works better than unilateralism, says IMF chief, FT (courtesy IMF), 17 Feb 10

Dani Rodrik: The case vs intl financial coordination--Global coordination, like global governance, sounds good. But the practical reality is that it cannot deliver the tough regulations, closely tailored to domestic econ and political requirements, which financial markets badly need in the aftermath of the global financial crisis. In a world of divided political sovereignty and diverse national preferences, the push for intl harmonization is a recipe for weak and ineffective rules. That is one reason why intl bankers love intl coordination, says Harvard economist, Proj Syndicate (courtesy Today's Zaman/ Turkey), 13 Feb 10

Posted on Wed, 10 Mar 10:

UN, US slam new Israeli settlement expansion: US Vice Pres Biden has been joined by UN Sec-Gen Ban in condemning Israel's approval of 1,600 new illegal settler homes in Palestinian East Jerusalem. The Israeli announcement came just 2 days after the Palestinians grudgingly agreed to indirect talks after mths of US shuttle diplomacy and coincided w/ the trip by Biden, the highest-level Obama admin official to visit Israel. The news broke as he was due to meet top Israeli officials to boost renewed peace efforts, Middle East Online/ UK, 10 Mar 10 (Deutsche Presse-Ag.--EU's Ashton joins Biden in condemning East Jerusalem building plan [courtesy Earth Times] | Haaretz--Sorry for distress over East Jerusalem plan - Israel's Interior Min)

One Family: A multitude of musical efforts for Haiti--Since the 12 Jan quake, there has been a flood of musical odes and projects for Haiti. While other tragedies have inspired telethons, concerts and charity songs, it seems as if Haiti's misfortune has caused a musical overflow. An adviser for the 'Hope for Haiti Now' telethon said there are more musical efforts today than for past tragedies because of how easy it is to record and share music, AP (courtesy CTV News/ Canada), 4 Mar 10 (MTV--'We Are The World: 25 for Haiti,' 22 Feb)

Joseph Stiglitz: The great American bank robbery--How did the big banks nearly take down the entire economy and still continue to profit? In an excerpt from his newly released book Freefall, Nobel Laureate '01 explains, AlterNet, 27 Feb 10 (Bankers made reckless bets on the economy, knowing taxpayers were going to pick up the tab)

Posted on Tue, 9 Mar 10:

Climate scientist admits sending 'awful emails' but denies perverting peer review: The scientist at the center of a media storm over global warming research, Phil Jones, Climatic Research Unit head at the Univ of East Anglia, told a UK parliamentary inquiry that he had sent 'awful emails' but said he expected to be cleared of accusations that he tried to pervert the scientific process. In his 1st public appearance since the emails were released in Nov, he faced repeated questions about the way the CRU failed to make publicly available the raw data and computer codes needed to reproduce its work. The controversy over the emails, dubbed 'climategate' by some, has raised questions about the validity of the global temperature record used to demonstrate global warming, based on email that scientists used a 'trick' to 'hide the decline', Guardian/ UK, 1 Mar 10 (U East Anglia vice-chancellor's statement after cmte inquiry | Transcript--UK parliamentary hearing | U East Anglia's submission to parliament)

New report examines investment and political risk in emerging markets: While political risk is a top concern for corporate foreign investors, the allure of biz prospects in the developing world means that these markets are likely to continue to attract a growing share of foreign direct investment. These findings and others are revealed in a new report, World Investment and Political Risk '09. To gauge how the current global financial crisis has colored the outlook of the investment community and insurance industry when it comes to long-term investments in developing nations, independent agencies were commissioned to conduct several corporate surveys, Multilateral Investment Guarantee Agency/ WB Group, 3 Dec 09 (Experts debate trends in world investment and political risk, 7 Dec 09)

Posted on Mon, 8 Mar 10:

Finding dollars and sense in feminist economics--Q&A w/ Diana Strassmann, Rice Univ economist and founder/ ed. of Feminist Economics, the Intl Assn for Feminist Economics' academic journal: 'One of the more exciting concepts is gender mainstreaming, which is now part of required policy in EU, Australia and SAfrica. At every stage of developing a policy, the impact on gender has to be brought into consideration. If we're developing a policy that might affect people's lives in profound ways, that might not have anything to do w/ gender, but it might, Houston Chronicle, 28 Jan 10 (Intl Women's Day | Would more women economists change econ policy?, Daily Planet/ US, Apr '06 | OECD--Tipsheet on gender mainstreaming [pdf] | Other gender tipsheets)

Martin Ravallion: The crisis and the world's poorest--Research has shown that past crises (eg, East Asia crisis) have left lasting effects on the poor. Many of the actions poor families have to take to help protect their current living conditions have lasting consequences. Debts rise; key productive assets (such as livestock or land) are sold. And kids are taken out of school to save money and add to the family's current earnings. When poor families are compelled to cut short their children's schooling in response to a shock, this creates a lasting impact on poverty since school drop-outs tend to earn less as adults, says World Bank Devt Res Grp's res dir, Development Outreach, Dec-Feb '10 [pdf]

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