Climate change

This is from a recent news story on Yahoo! "If the world's nations act responsibly, Stern said, they will achieve "zero-carbon" electricity production and zero-carbon road transport by 2050 — by replacing coal power plants with wind, solar or other energy sources that emit no carbon dioxide, and fossil fuel-burning vehicles with cars running on electric or other "clean" energy. Then warming could be contained to a 2-degree-Celsius (3.4-degree-Fahrenheit) rise this century, he said. But if negotiators falter, if emissions reductions are not made soon and deep, the severe climate shifts and sea-level rises projected by scientists would be "disastrous." It would "transform where people can live," Stern said. "People would move on a massive scale. Hundreds of millions, probably billions of people would have to move if you talk about 4-, 5-, 6-degree increases" — 7 to 10 degrees Fahrenheit. And that would mean extended global conflict, "because there's no way the world can handle that kind of population move in the time period in which it would take place." Maybe we should have known this fifty years ago???

Open letter

This is a copy of an open letter to Carlos Slim, one of the richest men in the world. He is not really Mexican though he claims to be. He has been sucking the guts out of Mexico for some time. Denise Dresser, a journalist, lets him have it in this letter.
The letter is in Spanish and I have no clue where it was published. I do know one thing: unless you're very fluent in the language, you'd best move on to another blog. I will have this translated in a few days - for whatever purpose that may serve.

"Estimado Ingeniero: Le escribo este texto como ciudadana, como consumidora, como mexicana preocupada por el destino de mi país y por el papel que usted juega en su presente y en su futuro. He leído con detenimiento las palabras que pronunció en el Foro "Qué hacer para crecer" y he reflexionado sobre sus implicaciones. Su postura en torno a diversos temas me recordó aquella famosa frase atribuida al presidente de la compañía automotriz General Motors, quien dijo: "lo que es bueno para General Motors es bueno para Estados Unidos". Y creo que usted piensa algo similar: lo que es bueno para Carlos Slim, para Telmex, para Telcel y para el Grupo Carso es bueno para México. Pero no es así. Usted se percibe como solución cuando se ha vuelto parte del problema; usted se percibe como estadista con la capacidad de diagnosticar los males del país cuando ha contribuido a producirlos; usted se ve como salvador indispensable cuando se ha convertido en bloqueador criticable. De allí las contradicciones, las lagunas y las distorsiones que plagaron su discurso y menciono las más notables. Usted dice que es necesario pasar de una sociedad urbana e industrial a una sociedad terciaria, de servicios, tecnológica, de conocimiento. Es cierto. Pero en México ese tránsito se vuelve difícil en la medida en la cual los costos de telecomunicaciones son tan altos: la telefonía es tan cara, la penetración de internet de banda ancha es tan baja. Eso es el resultado del predominio que usted y sus empresas tienen en el mercado. En pocas palabras, en el discurso propone algo que en la práctica se dedica a obstaculizar. Usted subraya el imperativo de fomentar la productividad y la competencia, pero a lo largo de los años se ha amparado en los tribunales ante esfuerzos regulatorios que buscan precisamente eso. Aplaude la competencia, pero siempre y cuando no se promueva en su sector. Usted dice que no hay que preocuparse por el crecimiento del Producto Interno Bruto; que lo más importante es cuidar el empleo que personas como usted proveen. Pero es precisamente la falta de crecimiento económico lo que explica la baja generación de empleos en México desde hace años. Y la falta de crecimiento está directamente vinculada con la persistencia de prácticas anti-competitivas que personas como usted justifican. Usted manda el mensaje de que la inversión extranjera debe ser vista con temor, con ambivalencia. Dice que "las empresas modernas son los viejos ejércitos. Los ejércitos conquistaban territorios y cobraban tributos". Dice que ojalá no entremos a una etapa de "Sell Mexico" a los inversionistas extranjeros y cabildea para que no se permita la inversión extranjera en telefonía fija. Pero al mismo tiempo, usted como inversionista extranjero en Estados Unidos acaba de invertir millones de dólares en The New York Times, en las tiendas Saks, en Citigroup. Desde su perspectiva incongruente, la inversión extranjera se vale y debe ser aplaudida cuando usted la encabeza en otro país, pero debe ser rechazada en México. Usted reitera que "necesitamos ser competitivos en esta sociedad del conocimiento y necesitamos competencia; estoy de acuerdo con la competencia". Pero al mismo tiempo, en días recientes ha manifestado su abierta oposición a un esfuerzo por fomentarla, descalificando, por ejemplo, el Plan de Interconexión que busca una cancha más pareja de juego. Usted dice que es indispensable impulsar a las pequeñas y medianas empresas, pero a la vez su empresa -Telmex - las somete a costos de telecomunicaciones que retrasan su crecimiento y expansión. Usted dice que la clase media se ha achicado, que "la gente no tiene ingreso", que debe haber una mejor distribución del ingreso. El diagnóstico es correcto, pero sorprende la falta de entendimiento sobre cómo usted mismo contribuye a esa situación. El presidente de la Comisión Federal de Competencia lo explica con gran claridad: los consumidores gastan 40 por ciento más de los que deberían por la falta de competencia en sectores como las telecomunicaciones. Y el precio más alto lo pagan los pobres. Usted sugiere que las razones principales del rezago de México residen en el gobierno: la ineficiencia de la burocracia gubernamental, la corrupción, la infraestructura inadecuada, la falta de acceso al financiamiento, el crimen, los monopolios públicos. Sin duda todo ello contribuye a la falta de competitividad. Pero los monopolios privados como el suyo también lo hacen. Usted habla de la necesidad de "revisar un modelo económico impuesto como dogma ideológico" que ha producido crecimiento mediocre. Pero precisamente ese modelo -de insuficiencia regulatoria y colusión gubernamental- es el que le ha permitido a personas como usted acumular la fortuna que tiene hoy, valuada en 59 mil millones de dólares. Desde su punto de vista el modelo está mal, pero no hay que cambiarlo en cuanto a su forma particular de acumular riqueza. La revisión puntual de sus palabras y de su actuación durante más de una década revela entonces un serio problema: hay una brecha entre la percepción que usted tiene de sí mismo y el impacto nocivo de su actuación; hay una contradicción entre lo que propone y cómo actúa; padece una miopía que lo lleva a ver la paja en el ojo ajeno e ignorar la viga en el propio. Usted se ve como un gran hombre con grandes ideas que merecen ser escuchadas. Pero ese día ante los diputados, ante los senadores, ante la opinión pública usted no habló de las grandes inversiones que iba a hacer, de los fantásticos proyectos de infraestructura que iba a promover, del empleo que iba a crear, del compromiso social ante la crisis con el cual se iba a comprometer, de las características del nuevo modelo económico que prometería apoyar. En lugar de ello nos amenazó. Nos dijo -palabras más, palabras menos- que la situación económica se pondría peor y que ante ello nadie debía tocarlo, regularlo, cuestionarlo, obligarlo a competir. Y como al día siguiente el gobierno publicó el Plan de Interconexión telefónica que buscaría hacerlo, usted en respuesta anunció que Telmex recortaría sus planes de inversión. Se mostró de cuerpo entero como alguien dispuesto a hacerle daño a México si no consigue lo que quiere, cuando quiere. Tuvo la oportunidad de crecer y en lugar de ello se encogió. Sin duda usted tiene derecho a promover sus intereses, pero el problema es que lo hace a costa del país. Tiene derecho a expresar sus ideas, pero dado su comportamiento, es difícil verlo como un actor altruista y desinteresado, que sólo busca el desarrollo de México. Usted sin duda posee un talento singular y loable: sabe cuándo, cómo y dónde invertir. Pero también despliega otra característica menos atractiva: sabe cuándo, cómo y dónde presionar y chantajear a los legisladores, a los reguladores, a los medios, a los jueces, a los periodistas, a la intelligentsia de izquierda, a los que se dejan guiar por un nacionalismo mal entendido y por ello aceptan la expoliación de un mexicano porque -por lo menos- no es extranjero. Probablemente usted va a descalificar esta carta de mil maneras, como descalifica las críticas de otros. Dirá que soy de las que envidian su fortuna, o tiene algún problema personal, o es una resentida. Pero no es así. Escribo con la molestia compartida por millones de mexicanos cansados de las cuentas exorbitantes que pagan; cansados de los contratos leoninos que firman; cansada de las rentas que transfieren; cansados de las empresas rapaces que padecen; cansada de los funcionarios que de vez en cuando critican a los monopolios pero hacen poco para desmantelarlos. Escribo con tristeza, con frustración, con la desilusión que produce presenciar la conducta de alguien que podría ser mejor. Que podría dedicarse a innovar en vez de bloquear. Que podría competir exitosamente pero prefiere ampararse constantemente. Que podría darle mucho de vuelta al país pero opta por seguirlo ordeñando. Que podría convertirse en el filántropo más influyente pero insiste en ser el plutócrata más insensible. John F. Kennedy decía que las grandes crisis producen grandes hombres. Lástima que en este momento crítico para México, usted se empeña en demostrarnos que no aspira a serlo." Denise Dresser February 15, 2009

Scary

The market is down - much further than I ever thought it would go. 8,000 would be the bottom - so I thought not too long ago. It's right now hovering around 7,300. It is really scary to see how scared investors are. What are they doing? Buying gold and pharmaceuticals and bonds and nothing else? What if this really turns into a depression? Then, to make matters worse, there is plenty of uncertainty in the global political sphere - wars and conflicts all over the place - Israel, Korea, Pakistan, Iran, and Africa in general, just to name five. What do you do with so many belligerent nations? There is definitely a scarcity of good government. Sooner or later, some one will tire of all this confusion and insecurity and urge a joining of strong forces - the reunification of church and state. That's the only thing that will keep unruly people in line. Europe will make a sharp turn to the right and probably catch everyone by surprise. The U.S. will simply keep playing games. Buy a house in Europe or Brazil or Argentina and good luck.

Europe

Doug Casey writes: "I think Europe is in even bigger trouble than the U.S. It's more highly regulated, more highly taxed, more imbued with socialist ideas. It's demographically in decline, and it's the front line in the War Against Islam. Forget it - except for a quaint vacation. I'm a big fan of Brazil; love the place, although I spend most of my time between Argentina and Uruguay, which I prefer. Any of these three countries (and Chile) are great choices. You'll get all the things you like about Europe, a lot less of the things you don't like, plus more opportunity, much lower costs, and vastly better weather - to me, it's not even a choice."

I must say I disagree with this, but only because I think Europe is about to take a sharp turn to the right. Europe and South America will probably soon create the biggest trading partnership in the world, so it won't matter where you decide to deplane or disembark. Good luck to you.

Russian Women

So, how do you make sure someone is on the up and up when they say they are a Beautiful Russian Woman interested in you??? The ad on the right side might help. I am not a client looking for a nice Russian girl so I have never tried it. You be the judge. It seems this person had a very bright idea. If it works, it will prove to be an invaluable service for everyone out there.

Responsible

From an investment newsletter (Daily Wealth) by Dr. Steve Sjuggerud: “Government policy shouldn't be this hard or this disastrous. Most of the time, the right answers for government come if you just think about it as if it were your family or your own business. For example, if it were your own money, would you take a private plane 365 times in two years to commute to work? Or would you take all of your family's money and borrow as much money as humanly possible from other family members to buy a fleet of brand new Hummers – destined to fall in value? Whenever you get confused about what the government is up to, here's a little secret for you... Just take it back to the basics. Simply ask yourself this: If this were my family, or my business, would I spend my money this way? Why can't governments from the smallest municipality all the way to the new administration abide by that simple standard?” This is something to think about, no?

USOIL

More grim news from Yahoo! News: “U.S. crude stocks have risen by 27 million barrels over the past month and on Wednesday, analysts expect that the government will report that trend has continued. Crude inventories could grow by as much as 3.4 million barrels, according to the average of estimates in a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos. That has not led to savings at the gas pump for many motorists, however. Refiners have cut production because of falling demand, and retail gas prices have been rising. On Tuesday, the average national retail price for a gallon of gasoline rose less than a penny to $1.92. That's 13.6 cents more per gallon than a month ago even though crude prices have fallen more than $6 per barrel in the same time.” How annoying. Crude prices drop by a lot but the price at the pump goes up. That’s manipulation. Since refiners have to keep making nice profits, they will not pass any savings along to consumers so (just like OPEC) they cut production in order to affect the supply side of the equation: LESS SUPPLY EQUALS HIGHER PRICE since the demand is still there, relatively unchanged. When they cut production, guess what happens: PEOPLE LOSE JOBS. Essentially, gasoline prices are maintained on the backs of people who need their jobs. There’s a morality lesson there somewhere if only I could find it. The U.S. government needs to buy as much oil as possible right now and put it in reserves. 27 million barrels is really not that much. In fact, compared to consumption, it’s nothing. It is time to NATIONALIZE the oil industry. We are almost there. PLEASE.

Trust has left the building

From Yahoo! News: “After Geithner's announcement, stock prices fell further and the dollar extended losses while prices for U.S. Treasury debt securities extended gains. James Ellman, President of Seacliff Capital in San Francisco, said: "Investors want clarity, simplicity, and resolution. This plan is seen as convoluted, obfuscating, and clouded." Geithner acknowledged deep skepticism has developed over the fairness and efficiency of a $700-billion bank bailout program approved by Congress in October. He said leaders of some financial institutions that have received money had squandered the good faith that is needed to make the bank rescue effective. "The spectacle of huge amounts of taxpayer money being provided to the same institutions that helped cause the crisis, with limited transparency and oversight, added to public distrust," Geithner said. The revamped approach to the government's financial rescue war chest would use $100 billion to cover risks the Fed would take in expanding a $200 billion program supporting consumer and small business lending to a $1 trillion program that also supports an array of mortgage-related assets. Markets appeared caught off balance by some of the measures that Geithner offered.”
I guess the psychology is now something like what the financial debacle brought to light: If it’s too complex to understand, don’t buy it. One cannot put too high a price on trust, confidence, and honesty. Perhaps those values are the true backbone of the economy? Who really knows? Is there anyone out there who has some credibility with the big investors? PLEASE.

Russia and Europe

From Yahoo! News: “WASHINGTON – A standoff over an obscure air base in a Central Asian country few Americans could find on a map is becoming an opening salvo in a new kind of Cold War with Russia. The prize is not military mastery or the global supremacy of ideas, but the defensive protection of resources and security. Each of the 20th century’s nuclear superpowers wants say-so over the decisions the other has reserved the right to make, and with a new U.S. administration signaling possible compromise with Russia on a missile-basing plan detested by Russia, Moscow is using U.S. dependence on the base for the Afghan war to drive a hard bargain. Security officials in Kyrgyzstan said Friday the United States must quit the Manas air base, but U.S. officials said they have not gotten any official eviction notice and that negotiations to stay are under way.” Let us not forget the Russians are expert chess players. Caught in the middle of all this are Germany and France, as always... somewhat amusing if it weren’t such serious stuff.

Nonsense

Does anyone really know the stock market? Of course not. Nearly 600,000 jobs were lost in January and the market went up by more than 200 points. If someone with an invisible hypodermic needle went around injecting investors with a good dose of optimism, the market would go up no matter what. That's what happened this Friday, no?

Church and State again

Well, now the saga between the pope and the newly re-instated bishop and the Jewish council in Israel has escalated to include the German government. Whatever happened to separation of Church and State? The pope has even asked the wayward bishop (in Argentina) to recant, which I'm sure he won't do. This will get dicey for sure, though the Vatican is very good at diplomacy. (See post of January 28 - Bishops and Rabbis)

Advertising revenue

So, the Super Bowl achieved some sort of breakthrough in advertising. It sold every minute of ad space. It's a good thing it's not a heavyweight title bout - sometimes those things are over in less than a minute. These football games have to go the distance, no?