JWG via DTN 15 January 2023 JT and Rae have been reading the tar baby saga and are trying hard…
Wednesday Night #1424
Written by Diana Thebaud Nicholson // June 17, 2009 // Canada, China, Economy, Government & Governance, Health & Health care, Herb Bercovitz, India, Middle East & Arab World, Montreal, Politics, Reports, Wednesday Nights // Comments Off on Wednesday Night #1424
Update on Hungary
Although the member nations of the European Union have benefited enormously from the elimination of physical and trade barriers and the establishment of a strong common currency, the rejection of a proposed constitution has led some local politicians to make extravagant promises that they are no more able to fulfil than were their predecessors. Hungary has long suffered from debt caused largely by providing benefits to its citizens that it cannot afford but which the electorate are not prepared to give up. There are few local resources, crime rate is unacceptably high and unemployment is excessive, exacerbated by the large numbers of Gypsy (Roma). At one time the Roma were employed as tinsmiths and horse handlers but with the evolution of industry, these trades no longer provide a viable income. Candidates for political office give the erroneous impression that their election will provide the country the opportunity of ameliorating the situation at the level of the European parliament. The recently elected far right wing party leader has apparently led the electorate to believe that she can solve all problems at the level of the European Parliament, a promise impossible to realize.
The high unemployment rate among the Roma leads to poverty, high crime rates and where the children are schooled, they are segregated in special classes. Someone has to do something but at the moment nothing is being done. Five to eight percent of the population of Hungary is Gypsy (Roma). Israel attempted unsuccessfully to solve a similar problem with its Bedouin population by providing them with land and water.
During the current world financial crisis, emerging markets continue to be attractive areas in which to invest as long as they possess a competent government and legal system. Despite the reluctance on the part of some investors in older markets to participate in the financial opportunities that exist in many emerging markets, it is useful to recall that when Canada was young – an emerging market – there were great rewards for those in Europe, an older market, who were sufficiently courageous to invest in North America. The role of demographics must not be underestimated – the populations of Latin America and Asia are predominantly young, while those of Europe and North America are old.
China is different, in a vacuum largely due to its one child policy.
Investment market strategy has evolved. The buy and hold strategy is no longer valid. With the single exception of Québec’s twenty-five year savings bonds, bonds lose in real value with time. With judicious investment in securities, shifting with the opportunities, the stock market remains a viable means of the growth of wealth, the greatest danger always being deflation.
Resources, mostly American, in the International Monetary fund cannot be maintained and there are about three billion ounces of gold in the whole world, hardly the basis of a common currency despite the opinion of those who believe otherwise. In the long term, it is most likely that a basket of currencies including gold will be established as the common world currency.
Iran, apparently unstable, in possession of nuclear weapons is no more a threat to the world than it was before the elections. No matter who ultimately takes power, little is likely to change, they will preserve their oil production and the politics of the Middle East will remain as it always has been.
It is to be regretted that Canada is opting out of the production of medical isotopes because within five years, the United States will be able to supply fifty percent of the world supply. Because of our lack of action on a foreseeable issue , possibly at least partly due to the Chernobyl disaster resulting in Canadians’ fear of nuclear energy, partly because of the dearth of members of Parliament knowledgeable in the field, we are falling behind in the energy field of the future in which we were once leaders. With the development of fast breeder reactors we would not only be in a position to provide a reliable energy source, but in doing so, transform what is currently the waste from our current reactors to fuel for a century and a half for fast breeder reactors. The International Thermonuclear Experimental Reactor (ITER), the model for nuclear energy through fusion, is not scheduled to be in operation for at least another decade and if successful, it is anticipated by Wednesday Nighters knowledgeable in the field of nuclear physics, that it will be at least between fifty and one hundred years until energy produced by fusion becomes viable.
China’s Three Gorges Dam in whose design SNC Lavalin played an important part, has been both praised and criticized by Wednesday Nighters. On a positive note, the energy produced by dam has replaced many coal burning devices, thus diminishing carbon emissions. However, at least two factors mitigate the otherwise successful planning and execution of this incredible enterprise. Many industrial towns were flooded without any attempt to detoxify them, adding significantly to the pollution of the river. Of even greater concern is the situation of the dam on a fault line that will cause a dreadful human disaster when, inevitably, the next earthquake strikes.
T H E I N V I T A T I O N
Update: Harper-Ignatieff deal to study EI averts summer vote: PM warns fall vote could bring ‘dangerous results’ for country ; John Ivison: Michael Ignatieff’s $300-million election ego (intriguing stats on Elections Canada’s slow processing of Liberal campaign expenses)
We observe with some interest the spat between Mr. Ignatieff and Mr. Harper – two pretty world-class egos going toe-to-toe over the latest economic report and whether or not their disagreement should result in an election. Jeffrey Simpson: Election if necessary, but not necessarily an election — A game of political chicken will unfold before votes of confidence set for Friday in the House of Commons. [Oh goody! They have had two ‘rare’ face-to-face meetings today] We don’t like the current federal government very much, but whether it is the conservatives or the liberals, we can count on a government that will be openly criticized by a –usually – independent press, advocacy groups, think tanks, private citizens and pretty much anyone else who cares to take a pot-shot, all free from persecution (although not always retaliation – don’t expect a federal appointment or a Senate seat – and your tax returns may be audited). Yes, there are injustices, lapses in judgement, downright stupidity, arrogance and also appallingly unmannerly screaming matches during Question Period, but in general our complaints are those of the perfectionist who abhors any lapse in decorum (read governance).
We are concerned about the future of isotope production and are relatively pleased that Ms Raitt is off the case, replaced by the less high-profile Health Minister Leona Aglukkaq, who has announced that the federal government will spend $6 million on clinical research projects to speed up the development of non-nuclear sources of alternatives to medical isotopes, to supplement or replace technetium-99, used to diagnose cancer and heart problems. We’re happy that Mr. Ignatieff has chosen this topic as one of the ones on which he requires answers from the PM. And while the world is concerned by the development of nuclear power by North Korea and Iran (yes, we know it’s not the same thing), it seems a pity that Canada is relinquishing an area in which it once led development.
A footnote to this week’s federal politics that you may have missed is the poor grade that Tom Flanagan gave to his previous star pupil, Stephen Harper.
Our current (local) dissatisfactions center on: the dearth of good candidates for the mayoralty of Montreal [well, why don’t we find someone to run?] ; the incredibly petty gesture that tried to exclude two anglo bands from performing at a St-Jean celebration – take comfort in how quickly public opinion caused an about-face) ; the annual summer construction mess including Concordia ‘Chaos corner’ ; rumours (!) of bribery and corruption in the construction industry – who ever would have thought it? ; the endless proposals and counter proposals for the Turcot Interchange ; the mega hospitals ; not to mention Marianopolis ; and soon we’ll have Mayor Tremblay’s plan for the Orange Julip area ‘green development’ to worry about – the burning question no doubt will be what to do with the Orange Julip – a sacred landmark that no doubt will be considered offensive by some group.
As we contemplate with dismay – and some scepticism – the deluge of news and opinion from every conceivable source on the Iranian elections and all the potential ramifications, we can only wonder at how relatively small and commonplace are our preoccupations here. Amidst all the commentary on Iran, the most poignant (and possibly the most intelligent) reaction comes from Annie Lowery’s Foreign Policy blog:
… we have no smoking gun and no decisive determination of what happened — no sure way of knowing if Ahmadinejad stole the election from Mousavi, or the election was fair, or Ahmadinejad stole an election he won. And, in some way, I find the uncertainty of what happened in Iran a bigger concern than obvious fraud. We know how to respond to election-thieves. But how do you react to a question mark?
Meantime, Ahmadinejad has hied himself off to Yekaterinburg, Russia to join in the Shanghai Cooperation Organization meeting and the BRIC Summit which has just concluded with a call for an increased role in global financial institutions by emerging economies and developing nations. The nations, representing emerging economic powers, demanded that developing economies have a “greater voice and representation in international financial institutions, and their heads and senior leadership should be appointed through an open, transparent and merit-based selection process.” Considering that the BRIC countries currently have a 15-percent share of the world economy and a 42-percent share of global currency reserves, this would seem fair. (We love the inadvertent pun in the comment by one of the experts that “The term BRIC wrongly implies that they are actually a bloc in any concrete way”.) More on the foreign exchange topic at the two meetings
Is China going to lead the way out of recession? Interesting views of CNBC experts (thanks, John Evdokias) who remind us that China (like most Asian economies) is an exporting economy. Worth listening to: “India is the sleeper in Asia”.
A propos, Dr. Rajiv Kumar, Director and Economist of the Indian Council for Research on International Economic Relations, is speaking on The Global Economic Downturn, G-20 and India at the McGill Faculty Club at 6pm this Wednesday – Sheila Arnopoulos will be attending and we hope will join us afterwards to brief us not only on Dr. Kumar’s talk, but also on the microcredit conference in Cartagena, Colombia which she says was ‘fantastic’.
President Barack Obama chided Wall Street financiers for forgetting how close the U.S. economy came to collapsing and predicted that the nation’s unemployment rate would rise to 10 percent by the end of the year. Speaking of regulation, here’s a great illustration (with thanks to Ofer Avital) of the need for some world-wide regulation: Japanese pair arrested in Italy with US bonds worth $134 billion It seems that authorities are trying to ascertain whether or not the bonds are counterfeit. The amount would place the two travellers as the fourth most important investors in US debt, well ahead of Britain ($128.2 billion) and just behind Russia ($138.4 billion) and on the other hand, if counterfeit, it would amount to a counterfeiting scam “on an unprecedented scale”. Meanwhile at home our Mounties have been put on the trail of the Mint’s missing millions in the wake of internal and external ‘precious metals reconciliation’ audits.