News and Analysis: 12-16 July 10 | EmergingFrontierMarkets.com

Based in: Manila, Philippines

Posted on Fri, 16 July 10:

Simon Johnson: The new antitrust - for banks--Just over a hundred yrs ago, US led the world in terms of rethinking how big biz worked - and when the power of such firms should be constrained. In retrospect, the breakthrough legislation - not just for the US, but also internationally - was the Sherman Antitrust Act of 1890. The Dodd-Frank financial reform bill (which was just passed by the US Senate on 15 July--Ed.) does something similar - and long overdue - for banking, says fmr IMF chief economist/ MIT prof, Baseline Scenario (Web log), 14 July 10; and

John Taylor: Financial reform with false remedies and errors of omission--While political factors (special interest lobbying, social activist pressures, covering up past mistakes) were probably behind much of the Dodd-Frank bill, economic analysis shows that the problem is that it is based on a misdiagnosis of the financial crisis, says fmr US Treasury undersecy/ Stanford prof, Economics One (Web log), 1 July 10

Computer error?: Despite the instinctive appeal of distributing laptops to poor schoolchildren, there is precious little evidence that making computers available to children improves educational outcomes. The circumstantial evidence that exists certainly doesn't buttress the one-laptop-per-child approach. Yet there are a number of simple, cheap programs that have been proven successful at getting children in developing countries into school and helping them learn more while they are there, Miller-McCune, 20 Aug 09

Posted on Thu, 15 July 10:

Afghans want foreign aid spent on their priorities: The Afghan govt wants foreign donors to focus 80% of the billions of dollars flowing into the nation on priority projects which it believes are key to pulling the nation out of poverty and turmoil, Afghan officials said. While grateful for massive intl aid, the officials lament that money spent during the past 8 yrs sometimes has financed temporary programs or unsustainable projects that will not make a long-term difference in the daily lives of Afghan citizens, AP (courtesy Dawn/ Pakistan), 13 July 10

Gregory Mankiw: Crisis economics--It may seem unfair to criticize govt economists working under great pressure in the midst of a crisis. After all, they are not in fact doctors treating patients. They work for politicians, who must take into account not just econ theory and data but also voter attitudes and political realities. But economists are social scientists, not politicians. The foremost job of economists is not to make the lives of politicians easier, but to think through problems, to examine all the available info about the problems' causes and potential treatments, and to propose the solutions most likely to work, says fmr US Pres.'s Council Econ Advisers chair/ Harvard prof, National Affairs, June-Aug '10

Jeffrey Sachs: Development aid in 5 easy steps--Every nation, rich and poor, should ensure universal coverage of primary health care, incl safe childbirth, nutrition, vaccines, malaria control, and clinical services. Each yr, nearly 9 mil. children die of conditions that could be prevented or treated, and nearly 400,000 women die because of complications during pregnancy. Almost all of these deaths are in the world's poorest nations. Ending these deaths would not only reduce suffering, but would also unleash econ prosperity in impoverished and unstable societies. says Columbia U Earth Inst dir, Proj Syndicate (courtesy Mmegi Online/ Botswana), 27 May 10

Posted on Wed, 14 July 10:

'Second engine of growth' to bolster Asian leadership: Asia is playing an increasingly prominent role in the world economy, but to sustain its strong performance it needs to develop a '2nd engine of growth', IMF chief Strauss-Kahn said at a 2-day conference titled "Asia 21: Leading the way forward" in the SKorean city of Daejeon, IMF Survey Mag, 12 July 10 (The 'Daejeon Deliverables')

Paul Krugman: The feckless Fed--Back in '02, a prof turned Federal Reserve official by the name of Ben Bernanke gave a widely quoted speech titled "Deflation: Making sure 'it' doesn't happen here." Like other economists, Mr Bernanke was deeply disturbed by Japan's stubborn, seemingly incurable deflation, which in turn was "associated w/ yrs of painfully slow growth, rising joblessness, and apparently intractable financial problems." This sort of thing wasn’t supposed to happen to an advanced nation w/ sophisticated policy makers. Could something similar happen to the US?, asks Nobel Laureate '08/ Princeton U prof, NY Times (free registr reqd), 11 July 10

Human-resources firm releases worldwide cost of living survey: Luanda in Angola is the world's most expensive city for expatriates, w/ Tokyo 2nd and Ndjamena in Chad in 3rd place, while Karachi is the cheapest. The survey covers 214 cities across 5 continents and measures the comparative cost of over 200 items in each location, incl housing, transport, food, clothing, household goods and entertainment, Mercer, 29 June 10 (Highlights)

Posted on Tue, 13 July 10:

Countries have opportunities to boost global investment competitiveness - Bank report: Overly restrictive and obsolete laws are an impediment to foreign direct investment and their poor implementation creates additional costs to investment, finds a new report Investing Across Borders 2010. In Angola and Haiti excessive red tape means it can take half a yr to establish a subsidiary of a foreign co. In Canada, Georgia, and Rwanda, this can be done in less than a wk. Leasing industrial land in Nicaragua and Sierra Leone typically requires half a yr as opposed to less than 2 wks in Armenia, SKorea, and Sudan. In Pakistan, Philippines, and Sri Lanka it can take up to 2 yrs to enforce an arbitration award, World Bank, 7 July 10

Keynes vs Alesina. Alesina who?: Alberto Alesina is a new favorite of fiscal hawks like fmr Pres George W Bush's chief econ adviser Greg Mankiw. A Harvard econ prof, the 53-yr-old Italian argues that austerity triggers growth, Business Week, 30 June 10 (Alesina/ Perotti: Germany spending is not the cure, VoxEU, 17 June | Ed.'s note--For the technically-inclined: Fiscal adjustments - Lessons from recent history, Harvard, Apr '10 [pdf])

US intelligence community debates China's bond holdings: US intelligence officials and top academics recently debated the risk China could wield its massive US debt holdings as a weapon aimed at influencing US foreign policy, acc to a person who attended the meeting. At a recent National Intelligence Council meeting held at a Wash. hotel, members of US intelligence agencies and China watchers discussed potential outcomes if China chose to sell its $900 bil. of US Treasury bond holdings, pushing up interest rates and making life much tougher for US biz and consumers, Reuters (courtesy XE.com), 23 June 10

Notice from the Publisher: We regret that we were unable to post from 5 July, Mon, to 12 July, Mon, due - yet again - to a disruption in our workflow, similar to (but not the same as) as the ones previously noted. But this time, a technical glitch is the ostensible culprit, the resolution of which (via ScanDisk) is why we are back. We think, however, there's more to it than that, as we explained last Jan. So, for what it's worth in the days ahead, "forewarned is forearmed", EmergingFrontierMarkets.com, 13 July 10

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