Ben Bernanke: Greenback's new father?Gold price key for India festive demand.Gold surges to near $1,000; touches new record in India.Delhi meeting re-opens doors on Doha Round
.FDI cap on MSMEs redefined.Sensex snaps 4-day slide, gains 291 pts!China, India key to check the economic crisis: World Bank
Pak is epicentre of terror in the region: Krishna
In Vedic age, money mantra!Big B playsBigg Boss! India to invest $10 bn in IMF: Pranab
Troubled Galaxy Destroyed Dreams, Chapter 368
Palash Biswas
http://nandigramunited-banga.blogspot.com/
ind control - Wikipedia, the free encyclopedia
Derren Brown
53 min - 10 Jul 2009
A maestro of mind control, Derren Brown is a psychological illusionist with a rare intuition that enables him to predict - and control - human behaviour. ...
www.channel4.com/programmes/derren-brown - Related videos -CIA MIND CONTROL EXPERIMENTS
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Fritz
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Modern History Sourcebook: Jawaharlal Nehru: Marxism, Capitalism
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Karl Marx - Wikipedia, the free encyclopedia
According to Marx, a capitalist mode of production developed in Europe when ... According to Marx, capitalists, on the other hand, take advantage of the ...
Biography - Career - Marx's thought - Marx's influence
en.wikipedia.org/wiki/Karl_Marx - Cached - Similar -Marxism - Wikipedia, the free encyclopedia
MARX ON CAPITALISM
Karl Marx (Stanford Encyclopedia of Philosophy)
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books.google.co.in/books?isbn=8126517956... -
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arx and globalisation
- [PDF]
Marx in the Mirror of Globalization
File Format: PDF/Adobe Acrobat - View
book A Future Perfect: The Challenge and Hidden Promise of Globalization, ... As Marx saw it, capitalism is not only about the production of material goods ...
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HowStuffWorks "How the Mafia Works"
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Urban Dictionary: Money Flow Mafia
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1 Aug 2009 ... Latest in Power & Money. New Credit Card Rules ... i really like the article.but any realy mafia member would know never to make note that ...
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 | A statutory body like a GST Council of India should be set up for the states to ensure uniformity in rates and procedures. |
The present financial crisis has shown that markets in general are not efficient without government regulation.
Taxing fossil fuels to reduce carbon emissions is a sensible part of the solution to climate change.
Market |
| NSE|BSE |
| SENSEX | 15689.12 | 290.79 |
| NIFTY | 4680.40 | 86.85 |
| NASDAQ | 2018.78 | 35.58 |
| DJIA | 9441.27 | 96.66 |
| RS/$ | 48.89 | -0.01 |
Hot on Wheels | ||||||
| ||||||
Law as a lucrative career
Shreya Biswas, ET Bureau
Ruth Ana Paul has just landed her dream job at London-based law firm Clifford Chance for a salary of Rs 30 lakh a year.
"This is exactly what I wanted,” exclaims the visibly excited
22-year-old as she anxiously hopes the year to rush by before she joins
the London offices of the world’s second largest law firm as a trainee
solicitor next August.
Ruth is not alone in getting an offer from a top global law firm like
Clifford Chance, which has 29 offices around the world. At least five
of her peers at NLSUI in Bangalore have received international job
offers from leading global law firms such as Allen & Overy and
Linklaters.
Sun Belt Power Poll - The Sharps Money Making ConferenceBetUs.com - - 12 hours ago The Sun Belt may be a step behind a lot of others conferences in America in terms of talent, but the oddsmakers don't always get their spreads ... Don't let this son riseExpress Buzz - 16 hours ago Jagan and Raju's shenanigans caused a controversy and tagged the late chief minister with the reputation of making money through SEZs (but which chief ... Making the most of mortgage overpaymentsguardian.co.uk - 11 hours ago "You are just making a free gift to your lender." Instead, put the money into an instant access savings account or a mini cash Isa paying a decent rate. ... In Vedic age, money mantraCalcutta Telegraph - Sep 3, 2009 Money is flying around. From this money springs wrongdoing and sin),” the chief minister told a condolence meeting today without making any mention of Vedic ... PF body weighs options to put big money in stocksBusiness Standard - Sep 3, 2009 The proposal also faced opposition at the meeting of the EPFO's apex decision-making body, the Central Board of Trustees (CBT), on July 4, particularly from ... How Bernard Madoff escaped detectionFinancial Times - - 19 hours ago To visitors, it looked like the vibrant, money-making, healthy operation it was on paper: Bernard L. Madoff Investment Securities. ... Fifa should be applauded for making a stand on honouring contractsguardian.co.uk - Sep 3, 2009 ... often in Italy, have howled with outrage that their teenagers have been "poached" or "robbed" by ruthless English clubs waving wads of money. ... Indian cinema not just about Bollywood: Amol PalekarZee News - 6 hours ago My focus is more on making a good, sensitive film. If it's good it will be seen anyway. Marketing is not one of my strong points, my work ends with the film ... Barista Lavazza wants a place of its ownDaily News & Analysis - - 12 hours ago Sanjay Coutinho, COO, Barista Lavazza, told DNA Money, "If the proposition is good, we don't mind buying the premises. We haven't yet found such a location ... Money and Chinese food paves MIC campaign trailThe Malaysian Insider - - 8 hours ago The battle is fierce with new comer Sothinathan, only 49, and a former Samy Vellu blue-eyed boy making inroads into Samy Vellu's vote bank that Palanivel is ... |
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The Mafia would at least get it rightCollingwood Enterprise Bulletin - - Sep 4, 2009 As if the ehealth scandal weren't bad enough, now we find that this arrogant disregard for public money is more infectious than swine flu. ... The Taliban as organized crime; and why an American mob boss must ...GlobalPost - 21 hours ago It was only after the federal government stopped fighting a war against the mafia and starting trying to cut off their money supply that they succeeded in ... A boycott to stem 'vote for money'Express Buzz - Aug 18, 2009 The money plundered by the sand mafia, rice mafia, sugar mafia, liquor mafia and other unscrupulous elements was used freely by the ruling party to ... Zynga blows past 100M monthly usersBizjournals.com - - Sep 2, 2009 Zynga makes money on the game largely by selling virtual goods ranging from buildings to plants and animals. Zynga founder and CEO Mark Pincus recently said ... Asking for funds...at gun-pointTimes of India - - Sep 2, 2009 Pushpendra Jaiswal, a representative of a city-based traders union said: "The issue of extortion demands by the local mafia from the denizens is being ... JOHN L. SMITH: 'Mafia Cops' drug case nears end while gloomy anti ...Las Vegas Review - Journal - Sep 4, 2009 Lang's story was captured in the movie "Two For the Money." BOULEVARD III: JR's Place at 5745 S. Durango is getting raves from locals seeking great food at ... Hundreds attend funeral for former mob underboss AngiuloBoston Globe - - Sep 3, 2009 By Shelley Murphy, Globe Staff Former New England Mafia underboss Gennaro "Jerry" Angiulo is gone, but not forgotten. A standing-room-only crowd packed St. ... Easy money for land-grab toughsTimes of India - - Aug 26, 2009 The land mafia also share profits with key management personnel of realtors. "As a mentor, the company man takes a share of 10% of the profit," said a close ... Make money with social networking sitesCanada.com - Aug 30, 2009 It's social network applications like Mafia Wars, FarmVille, Texas Hold'em and YoVille had over 60 million active monthly users as of July, 2009. ... Stimulus Money: An Offer the Mob Can't RefuseThe New American - - Aug 31, 2009 Law enforcement officials believe that the Mafia (and other similar organized crime groups) is attempting to garner billions of federal "stimulus" dollars ... |
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FDI cap on MSMEs redefined
ET Bureau
NEW
DELHI: The government on Friday said foreign entities cannot hold more than 24%
stake without prior permission in industrial units that
reserved for the small and medium segment, clearing the air on the sector which
accounts for almost 90% of India's manufacturing prowess.
Twenty-one items, including
bread, wooden furniture, steel chairs safety matches, stainless steel utensils
and steel furniture, are reserved for small scale producers.
An official notification on
this in effect brings in regulatory oversight over foreign ownership of big
industrial units that compete with small and medium enterprises.
The clarification by the
department of industrial policy and promotion—called Press Note 6 of
2009—removes the ambiguity arising from a change in the definition of
small scale industry in a new law enacted in 2006 called the Small and Medium
Enterprises Development (SMED) Act.
Before the SMED Act came into
force, small scale companies were firms which have an investment of Rs 5 crore
in plant and machinery and less than 24% ownership by bigger industrial units or
foreign investors . The SMED Act removed the 24% ceiling for ownership of SME
units by bigger domestic firms or foreign investors. This allowed the redefined
small and medium enterprises to have higher foreign ownership up to the limit
prescribed for individual sectors.
The new Press Note clarifies
that while higher foreign investment
mentioned in the FDI policy, bigger industrial units producing any of the 21
reserved items should seek government’s consent before raising FDI beyond
24%.
Besides, such bigger
units should continue to maintain the existing export obligation—sell at
least half of their output in foreign markets.
Ben Bernanke: Greenback's new father?
New York Times
NEW
YORK: Six months after the financial world seemed to be coming to an end, the
world’s economies appear to be recovering. Banks that seemed
brink of failure less than a year ago are now able to pay back investments made
by the Treasury.
It is too
early to declare victory, but the world looks much safer than it did only a few
months ago. Credit markets are recovering, to the point that the junk bond
market will have its best year ever if it manages not to lose any money over the
rest of 2009. The stock
1938.
If victory is to be had,
it will owe a lot to the willingness of American policy makers to set aside
cherished policies and simply create money. And that is one reason it is
appropriate to pause and celebrate an unheralded bicentennial: The father of the
greenback, Elbridge Gerry Spaulding, who was born 200 years ago in
1809.
Spaulding was that rarest
of creatures, a man who succeeded in both business and politics; a congressman
who saw a problem coming and had a solution ready. It was he who, at the end of
1861, figured out that the U.S. government simply needed to print money to pay
for the Civil War. It was economic heresy then, but without it this country
might not have survived.
Such
an idea was then dismissed by some as "fiat money," money that is money not
because it is backed by gold or silver, but because some government says it is
money.
That such currencies can
fail to work is obvious, as those who lived in Weimar Germany or present-day
Zimbabwe have found out. But notwithstanding those examples, the last 20 years
deserve to be remembered as the age of fiat money. For much of that time,
central bankers were revered as heroes for engineering long booms and short,
shallow recessions.
| Also Read |
| → China, India key to check the economic crisis: World Bank |
| → Canada unexpectedly adds 27,100 jobs in August |
| → IMF revises up 2010 world GDP forecast to 2.9 pc |
| → US unemployment rate rises to 26-year high |
Ben
Bernanke, the current chairman of the Federal Reserve, sometimes does not seem
to understand that this reputation has taken a hit. After he warned that "a
perceived loss of monetary-policy independence" could lead to "reduced economic
and financial stability," he drew a taunting comment from Dean Baker, an
economist with the Center for Economic Policy and Research in
Washington.
"Maybe Mr. Bernanke
missed it," wrote Baker, "but his independent Fed gave us the largest financial
and economic crisis since the Great Depression. Does anyone really think that
things would have been worse if the Fed had been more
accountable?"
Bernanke did not
miss it, of course. He may have been slow to realize how critical the situation
was, but when he did he acted decisively. Like Spaulding almost 150 years ago,
he showed a willingness to abandon the wisdom of an earlier time. The government
lent money it did not have to financial institutions, and bought stock in
them.
China, India key to check the economic crisis: World Bank
PTI
WASHINGTON:
India, China and other developing nations have played a key role in checking the
economic crisis, World Bank
need of multiple poles of growth as the global economy can no longer rely on the
US consumers.
"We can no longer rely on the US consumer to sustain
global growth. We need multiple poles of growth," Zoellick told reporters at a
news conference in Beijing.
"China, India, and other developing
countries have been key players in stopping the crisis from getting worse and
laying the foundations for a broad-based recovery, but other developing
countries can also offer other pools of growth."
From Beijing,
Zoellick heads towards London where he would attend the G-20 ministerial
meeting.
"The London G20 Summit in April helped stabilise the world
financial system, but looking ahead to the Pittsburgh Summit of the G20 later
this month, we need to address the needs of the developing countries in this
crisis. They are the ones that are most vulnerable, but they are also potential
sources for demand and growth," he said
MONEY & BANKING
LIFE INSURANCE:
LIC clocks 60% growth in fresh biz premiums in July
Private players 11% in negative. Mumbai, Sept. 4 Are private sector
life insurance companies losing steam in garnering new business
vis-a-vis their State-owned rival? The insurance regulator’s data seem
to suggest ...
CREDIT MARKET:
IIFCL to disburse Rs 11,000 cr this fiscal
Appoints
consultant to frame bond market policy. Kolkata, Sept. 4 India
Infrastructure Finance Company Ltd (IIFCL) has set for the current
fiscal a disbursement target of about Rs 11,000 crore, according to its
Chairman, Mr ...
FOREX:
Rupee gains marginally
The
rupee appreciated marginally against the dollar on Friday, tracking the
domestic equity indices.The rupee opened at 48.94 and strengthened to
touch an intra-day high of 48.81. It ended trade at 48.89, against the
previous close of ...
DIVIDEND ANNOUNCEMENT:
ING Vysya shareholders okay dividend
ING
Vysya Bank Ltd has informed the Bombay Stock Exchange that the
shareholders at the bank’s annual general meeting held on Friday have
approved a 20 per cent dividend for the financial year ended March 31,
2009. A bank press release ...
SHORT TERM INSTRUMENTS:
Call rate unchanged
The
inter-bank call rate remained unchanged at 3.20-3.30 per cent. Under
the Liquidity Adjustment Facility (LAF) conducted by the Reserve Bank
of India, there were no bids in the three-day repo auction. In the
reverse repo auction, there were ...
NON-PERFORMING ASSETS:
KVB engineers loan repayment solution for troubled borrowers
Coimbatore,
Sept. 4 Bankers are known to shut the umbrella just when it begins to
rain. But KVB recently proved that this perception can ...
CORPORATE BONDS:
BoM to raise Rs 300 cr via bonds
Kolkata,
Sept. 4 Bank of Maharashtra plans to raise before October Rs 300 crore
via tier-I and tier-II bonds to bolster its capital adequacy ratio and
fund growth requirements, its Executive Director, Mr M.G. Sanghvi, ...
CREDIT MARKET:
Vijaya Bank sees higher credit demand from farm sector
Kolkata,
Sept. 4 Vijaya Bank anticipates 20-22 per cent growth in credit and 18
per cent rise in deposits in 2009-10, according to its Chairman and
Managing Director, Mr ...
NBFCS:
No plan yet to extend securitisation law to NBFCs
New
Delhi, Sept 4 The Government is not looking to bring non banking
finance companies (NBFCs) within the ambit of the Sarfaesi
(Securitisation and Reconstruction of Financial Assets and Enforcement
of Security Interests) law, a senior ...
DEBT MARKET:
SEBI cuts FII limit in gilts to Rs 800 cr
Mumbai,
Sept. 4 SEBI on Friday said allocation of Government debt limits for
foreign institutional investors through open bidding process has been
scheduled for September 8 on ...
FOREX:
Forex reserves rise to $276.3 billion
Mumbai,
Sept.4 Foreign exchange reserves rose $4.4 billion to $276.3 billion
for the week ended August 28, according to figures released in the
Reserve Bank of India’s weekly ...
FINANCIAL SERVICES:
Nomura receives nod for PD business
Mumbai,
Sept. 4 Nomura Fixed Income Securities Pvt Ltd (NFIS) has received the
Reserve Bank of India’s approval to undertake primary dealership (PD)
business in Government securities with effect from ...
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Markets this week
The Union Government has decided to hand over the reins of
management and promoter status of Maytas Infra Ltd (MIL), promoted by
Mr B. Teja Raju to IL&FS.
IL&FS (Infrastructure Leasing & Financial Services), which
holds 14.5 per cent equity, has been directed by the Company Law Board
(CLB) to infuse Rs 55 crore as liquidity support and foreclose its
rights on the pledged shares of 22.6 per cent, which will take its
total holding to 37.1 per cent. It will also make an open offer for
22.6 per cent and appoint four of its nominees including the Chairman
on the board.
The shareholders of Britannia Industries Ltd approved a resolution
related to a scheme for the issue of bonus debentures by drawing upon
the general reserves of the company.
This would be done by distribution of Rs 406.13 crore from the
general reserves through issue of secure fully paid bonus
non-convertible debentures of Rs 170 each. One such debenture would be
issued for every equity shares of Rs 10 each held by a shareholder.
A selloff in Chinese markets owing to worries on bank lending, hit
the investor sentiments, triggering a slide on the Indian bourses on
Monday.
The Sensex settled lower at 15,666 sheds 255 points after trading
between 15,589 and 15,821. On the NSE, the Nifty lost 70 points to
close at 4,662.
Interest rate futures (IRF), an exchange traded derivative
instrument for protecting or hedging interest rate risk, was launched
on the National Stock Exchange on Monday.
IRFs are based on a notional 10-year GOI bond, bearing a notional 7
per cent interest rate coupon payable half yearly. The tradable lot
size for IRF is Rs 2 lakh.
Selling by foreign funds and weak cues from European markets skidded
the stocks lower on Tuesday. The Sensex ended down 115 points at 15,551
and the Nifty skids 36 points to close at 4,625.
The shares of NHPC were listed at a premium of 16.7 per cent to its
issue price of Rs 36 on the NSE on Tuesday. The shares listed at Rs 42
but closed just marginally above the issue price, at Rs 36.75.
The tug-of-war between Bharati Shipyard and ABG Shipyard to gain
control of Great Offshore has now hit a stumbling block with SEBI yet
to give statutory approval for the open offer process.
Simply put, it means that the original open offer schedules
mentioned in the first public announcement and further revisions made
by Bharati and ABG are of little consequence. The process will kick in
when SEBI gives the go-ahead. Bharti's open offer ended on August 13
while ABG's offer came to an end on September 1. Both revised their
offer prices -with Bharati's latest being Rs 405 on July 6 and ABG
revising it to Rs 520 earlier this month through a series of bulk and
block deals.
Weak global cues and volatile trading dragged the shares on
Wednesday. The benchmark Sensex slipped 83 points and finished at
15,467 while the Nifty eased 17 points to close just above the 4600
level at 4,608.
IL&FS has fixed Rs 112.80 a share as the price for the open
offer to acquire 20 per cent additional stake in Maytas Infra Ltd. An
announcement by SBI Capital Markets on behalf of IL&FS said the
process will be completed within three months.
Shares ended lower for the fourth consecutive session on Thursday
despite positive cues from Asian markets. The Sensex finally finished
lower at 15,398 down 69 points and the broader Nifty fell 15 points to
close at 4,593.
The Securities and Exchange Board of India is turning a stricter eye
on company promoters who have been issued preferential warrants, saying
that they will have to forfeit the upfront payment made on unexercised
warrants.
This is contained in its recently notified Issue of Capital and
Disclosure Requirements (ICDR) Regulations 2009, which SEBI made public
on Thursday.
These regulations replace the Disclosure and Investor Protection
(DIP) Guidelines 2000 that now stand rescinded. In the matter of
preferential warrants, SEBI's new norms are probably meant to contain
the situation following January 2008, when the stock market crash
brought the price of several shares below the warrant exercise price
for promoters, several of whom decided not to exercise their warrants
in full. Promoters will now have to be more careful, as their upfront
payment made only against exercised warrants will now be adjusted, said
an expert familiar with regulatory matters.
On Friday, the markets witnessed a strong rally owing to firm trends
in Asian and European markets. The benchmark, Sensex climbed up 290
points to end higher at 15,689 and the Nifty spurted 87 points to close
at 4,680. The top gainers among the Sensex packs are M&M, Hero
Honda, Sterlite Industries, L&T and HDFC.
Compiled by S Vasudevan
Right time to enhance gold stocks
The IMF is likely to sell one-eighth of its gold stocks to tide over
its resource crisis. India should seek to buy all the 403 tonnes on
offer from the IMF. This would place its official gold stocks above
China and the Netherlands and close to Japan, says SITHARAM GURUMURTHI.
Gold constitutes an integral part of a country’s reserves. The
stability of a country’s currency to some extent depends on the
quantity of its gold holdings (see Table). The dollar started losing
its sheen in the late 1960s, mainly due to several countries demanding
a large amount of gold at the fixed rate of $35 per ounce, leading to a
serious erosion of the gold reserves of the US and the announcement by
President Nixon in August 1971 that the US would no lon
ger exchange gold for dollars. This led to the collapse of the
international monetary system.
When the European countries floated the common currency, the euro,
in 1999, they had taken care to see that the new currency was backed by
a significant amount of gold. There is a school of thought that India
should deploy part of its large reserves to buy fine gold, just as
China has been doing during the last couple of years.
A report in Business Line on July 8, 2002, quoted
the then Petroleum Minister, Mr Murli Deora, reminiscing about his
longstanding friend, the late Dhirubhai Ambani, commenting on the
deployment of India’s surging foreign exchange reserves: “What is the
use? The government is investing them in US treasury bonds, which yield
2.5 per cent, while borrowing at 11 per cent.”
India’s stock of gold has remained static, at around 357 tonnes, for
quite some time, while China has been steadily augmenting its gold
holdings the last couple of years.
GOLD SALE BY IMF
In recent years, IMF finances have become unsustainable following a
large decline in credit outstanding. In the absence of concrete
measures, an income shortfall of $165 million in the financial year
2007 was expected to widen to about $400 million in 2010.
The poor state of IMF’s financial health is attributable to the fact
that several formerly cash-strapped third world countries such as
Indonesia, Serbia, Ecuador and Uruguay became prosperous enough to
complete the early repayment of IMF loans, making inroads into the
interest income the IMF relies on to over its operating expenses. At
the same time, during the last 10 years, the IMF’s annual budget has
doubled to nearly $1 billion.
A Committee of eminent persons, including the former Federal
Reserve Chief, Alan Greenspan, and chaired by Andrew Crockett, former
Director of the Bank for International Settlements and now the Chairman
of JP Morgan Chase, has recommended that the IMF should adopt a new
income model with more diverse sources of income.
One of the income resources the Committee has proposed is the
creation of an endowment funded from the proceeds of strictly limited
gold sales to be carried out within safeguards to avoid disruption of
the gold market.
The Committee has recommended that gold sales be limited to the gold
the IMF has acquired after the Second Amendment, which amounts to 12.97
million ounces (403.3 metric tonnes), equivalent to one-eighth of the
IMF’s total gold holdings.
The Committee has recommended that the IMF’s gold sales should not
add to the announced volume of sales from official sources. Hence, the
IMF’s gold sales should be coordinated with current and future Central
Bank Gold Agreements (CBGA).
Under the current CBGA, a group of European central banks has agreed
to limit its gold sales to not more than 500 metric tonnes annually. If
gold is sold in the market rather than to an official gold holder, the
Crockett Committee has recommended that such sales should be phased
over a period of time to avoid disruption of the gold market.
The US Congress approved sale of gold by the IMF in the month of
July 2009. This will, however, have to be formally approved by the
Executive Board of the IMF, which in turn awaits approval of a related
decision on the New Income Model to widen the investment authority of
the Fund, requiring an amendment to the Articles of Agreement of the
Fund.
China has already started making behind-the-scene moves to buy the
entire quantity of 403.3 tonnes of gold, which would take its ranking
above Japan. India should strongly resist such moves by staking its
claim to buy the entire quantity since, as a founder member of the IMF,
India has a better claim than China, which joined the IMF several years
later.
If India were to buy the entire quantity of 403.3 tonnes of gold, it
would take the country’s stock of gold to 760.3 tonnes, placing it
above both China and Netherlands and very close to Japan.
INFORMAL HOLDINGS
It has been estimated that gold holdings in India are almost a
third of its GDP. According to World Gold Council estimates, Indian
households own about 15,000 tonnes of gold, accounting for about 10 per
cent of the worldwide stock. At current market values, gold accounts
for 10-15 per cent of the Indian household balance sheet. The value of
gold held by Indian households is more than double the market value of
the equity stock they own.
Traditionally, gold has been a good safety net for Indian
households. India’s share of global gold demand is about one and a half
times that of the US, though its GDP is only 1/20th that of the US.
With its high rate of gold consumption, India accounts for 18 per
cent of annual global gold demand, while its share of global GDP on
nominal dollar GDP is only 1.6 per cent.
As these stocks of gold do not form part of the banking system, it
is necessary to explore ways to encourage individuals and institutions
like temples to bring their respective gold holdings into the banking
system, by providing such fiscal incentives as exemption from wealth
tax and immunity from income-tax, on the one hand, and permitting gold
to be offered as collateral security to get bank loans.
(The author, a former IAS officer, was staff member of the International Monetary Fund, Washington D.C.)
http://www.thehindubusinessline.com/2009/09/05/stories/2009090550450800.htm
Sensex snaps 4-day slide, gains 291 pts
Pranab begins BRIC meetings, India asked to plug IMF funding holeFinance Minister Pranab
Mukherjee began meeting with his counteparts from Brazil, Russia and China ahead
of a G20 meeting here Friday, as
replenish a massive funding gap in the International Monetary Fund
(IMF).
Mukherjee, participating in his first Group of 20 meeting as
finance minister, met Guido Mantega of Brazil, Xie Xuren of China and Alexey
Kudrin of Russia to firm up the position of the BRIC group ahead of the full G20
meeting Saturday.
The BRIC ministers, representing countries that are
on an economic growth trajectory, are expected to renew calls for a greater say
in the running of the IMF, including a bigger share of voting
rights.
The BRIC meeting also follows a call by the finance ministers
of France and Germany for India and other emerging economy-members of the G20 to
increase their contributions to the IMF.
"Other countries like India,
Saudi Arabia and other emerging markets can be expected to make pledges and we
should continue to call on them to join the international effort," Christine
Lagarde of France and Peer Steinbruck of Germany wrote in a joint
letter.
"However, we believe that Europe should not wait for these
pledges and should announce rapidly the amount of its own contribution," they
added.
G20 leaders, including Prime Minister Manmohan Singh, agreed
at their London summit in April to add $500 billion to the IMF, particularly to
help poor countries grapple with the credit crunch - part of a massive $1.1
trillion rescue package announced by British premier Gordon Brown at the
summit.
The EU had then offered to provide about $100 billion, but
France and Germany earlier this week said that sum should be raised to $175
billion.
Britain has urged Europe to set an example and do more to
meet the target of $500 billion pledged to the IMF. Britain has agreed to lend
up to $15 billion to poorer economies and is willing to provide up to $11
billion more as part of an EU package.
The G20 comprises Argentina,
Australia, Brazil, Britain, Canada, China, France, Germany, India, Indonesia,
Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey,
the US and the European Union.
Gold prices surged to near 1,000 dollar level in global markets on Friday
on investment buying while touching an all-time high in
demand.
Gold in the US futures
market reached 999.50 dollar last night, the highest price since Feb 23 helped
by lower equities as sluggish stock markets diverted funds to the bullion as a
safe haven. The MSCI World Index of shares
heading for its first decline in eight
weeks.
The metal also gained as
investors sought a haven on concern that a global recovery might be slower than
expected. The US jobless rate in August jumped to 9.7 per cent, the highest
since 1983.
A firming trend in
the US markets, which normally set price trend in Asian region including India,
drove the gold prices in India to its record high levels amid brisk buying by
stockists and jewellery makers for the ensuing marriage and festival
season.
The bullion in the
national capital today shot up to an all-time high of nearly Rs 16,000 per 10
gram on last minute heavy purchases by traders to build up stocks before the
start of the inauspicious 'Sharad'
tomorrow.
The surge in the gold
rates was led by heavy demand from jewellers and stockists before Shradh, a
inauspicious fortnight for making any fresh purchases, marketmen
said.
| Also Read |
| → Gold imports seen down 63 pc: Trade body |
| → Gold imports to fall two-thirds in 2009 |
| → India July gold imports up 7.6 pc y/y to 41 tonnes: WGC |
| → Gold prices rise to all-time high of Rs 15,900 |
"We
have plenty of orders for jewellery in hand and have to purchase it before the
fortnight of Sharads begin," said Delhi-based jeweller Rakesh
Anand.
Further the uncertainty
in the stocks, which remained more volatile in last one-week, left little option
for the investors but to invest
haven.
In the last one week the
Bombay Stock Exchange index Sensex fell for four consecutive days, but gained
290.79 points today at 15,689.12, the last trading day of the
week.
Silver ready surged by Rs
700 to Rs 25,300 per kg and weekly-based delivery by Rs 560 to Rs 25,700 per
kg.
Standard gold and ornaments
shot up by Rs 200 each to Rs 15,900 and Rs 15,750 per 10 gram respectively.
Sovereign also rose to all-time high by gaining Rs 100 to Rs 12,800 per piece of
eight gram.
slide, with the benchmark Sensex gaining over 290 points in volatile
trade.
The market sentiment was boosted by bullish Asian markets and a strong start in European bourses.
The Bombay Stock Exchange 30-share Sensex ended the
day higher by 290.79 points or 1.89 per cent at 15,689.12. The gains
came after a loss of 524 points or 3.29 per cent in the past straight
four days.
Marketmen said buying activity got support as
investors calculated that the recent fall was overdone. The sentiment
was also buyoed by revival of monsoon in some parts of the country,
they added.
With buying spread over across counters, all
sectoral indices closed with gains. Auto shares were back in demand as
revival of monsoon is expected to reflect in stronger demand for
tractors and two-wheelers.
Auto major M&M topped the list of index gainers at 6.21 per cent, followed by another auto share Hero Honda at 4.20.
Sterlite, L&T, HDFC and ONGC all gained over 3 per cent.
However, Tata Group companies Tata Motors and TCS Ltd ended up as losers in the range of below 1 per cent.
Asian indices such as Hang Seng ended up 2.82 per
cent, Strait Times 0.94 per cent, Shanghai Composite 0.58 per cent and
Taiwan Index 0.68 per cent.
European markets were trading higher by about 1.0 per cent in their early trade.
ndia's gold demand is badly down this year, but the poor monsoon has not hurt
sales as much as had been expected, a senior official at
Scotia Capital said on Saturday.
The August-October festival season
has seen some pick-up in demand, which could strength if prices fall by around
$60 an ounce from current levels, said Sunil Kashyap, regional head of Asia
Pacific global capital markets.
"The general market feedback is that
volatility has scared people away and they prefer to be on the sidelines. Demand
may re-emerge if prices fall to $920-930 an ounce," he said.
Kashyap
was speaking on the sidelines of a weekend conference in
Goa.
| Also Read |
| → Gold prices rise to all-time high of Rs 15,900 |
| → India July gold imports rise 7.6 pc y/y -WGC |
| → Gold surges to near $1,000; touches new record in India |
| → Gold surges to 7-month high on global cues, rising demand |
"High prices are
certainly going to affect demand. If in this Diwali (festival on Oct 17) prices
are going to be at 16,000 rupees ($327) per 10 grams or even rise to about
20,000 rupees, it may adversely affect physical markets."
Scotia, one
of the 20 licensed banks
biggest market, has approximately 35 per cent of the market share in India,
according to trade estimates.
Kashyap said India's June to September
monsoon, which has failed in many parts of the country prompting fears of a fall
in rural spending, had not affected gold sales in a big way so
far.
"Surprisingly the net impact on demand is not as negative as one
would have thought," Kashyap said.
"Demand from some areas, which got
a lot of rains has offset demand from places which had no rains. Prices tend to
affect demand much more than other factors, at least in the
short-run."
He added that Indian consumers were getting gradually
used to the higher prices this year, though the last "solid demand" was seen at
$880-$890 an ounce.
Gold was at $880 an ounce in early May this year,
after which it rose steadily to keep well above $900.
On Friday, gold
traded at $994.80, down from $997.20 the previous day when it failed to break
the psychological mark of $1,000 amid concerns about equities markets and
inflation.
Higher prices have increase volatility in India's gold
importing trend, Kashyap said.
"Earlier we used to have volatility
(in import volumes) of 20-50 tonnes, now it has enlarged to 20-100 tonnes," he
said. "It is just that people are more cautious."
Trade ministers representing the broader membership of the World
Trade Organisation (WTO) on Friday lifted the logjam in the Doha Round
of trade talks to clinch a global free trade agreement on goods and
services by resolving to resume high-level discussions in Geneva from
September 14.
Announcing this at the conclusion of a two-day mini-ministerial
hosted by India, the Union Minister for Commerce, Mr Anand Sharma, who
chaired the conclave, told reporters that “there has been a
breakthrough in negotiations. The impasse in resuming negotiations has
been broken”.
“The chief negotiators and senior officials will meet on September
14 in Geneva to restart the entire process as there was a unanimous
affirmation on the need to conclude the Doha Round within 2010” since
eight years of patient negotiations had been invested in the round so
far, Mr. Sharma observed.
In a statement, Mr Sharma said the Geneva process of engagement
would continue for the next two-three months and the negotiating teams
of members would work with the Chairs of the Negotiating Groups to
prepare an overall agenda of action.
They would, he said, draw up work plans, including tabling,
discussion and finalisation of texts where required and the timelines
for submission of revised offers (services) in line with the overall
agenda of action. He said Ministers agreed that negotiations should
resume on the basis of progress achieved till December 2008.
Mr Sharma said the decided that the work agenda for the least
developed countries (LDCs) covering all specific issues across the
spectrum should be put on a fast-track for negotiating convergence with
the WTO chief, Mr Pascal Lamy, and Chairs of Negotiating Groups taking
the lead in this process.
Mr Sharma conceded that “there was a clear recognition that
differences subsist on issues and intensifying the negotiations was the
first step towards bridging these gaps”.
The Doha Round, which began in 2001 in the Qatari capital, has been
stalled on differences between the rich and poor countries over
agricultural subsidies and market access for industrial goods and the
last ministerial floundered in July 2008. The just-concluded New Delhi
meeting was designed to develop a broad-based consensus to remove the
impediments in the way of multilateral negotiations and re-energise the
stalled talks to take it to its logical end.
The deadlock between the major trading blocs, centred on serious
differences over farm subsides in developed countries and tariffs on
industrial goods in developing ones, put paid to repeated attempts to
forge a new pact.
up to $10 billion in the International Monetary Fund as part of a major thrust to wrest a greater say in the running of
"India has decided to invest up to $10 bn of its reserves in notes issued by the IMF," Mukherjee said after a meeting of the finance ministers of Brazil, Russia, India and China (BRIC) in London.
The Indian pledge is part of a total of $80 billion that the four BRIC countries will invest into the IMF in order to replenish its fund aimed at helping out countries that are struggling in the current financial crisis.
China will account for $50 billion of this amount, and the rest will be borne by India, Russia and Brazil.
In return, the BRIC countries want a greater say in the running of the IMF and other international financial institutions such as the World Bank, including a larger share of quotas and voting, said Brazil's Finance Minister Guido Mantega.
Part of the BRIC meeting was joined by US Treasury Secretary Timothy Geithner in a move that Mukherjee described as "an acknowledgement of the group's emergence as a key voice in global economic and financial issues".
Meanwhile, Security Risk Hype banking onAnti Pakistan Blind nationalismgets momentum as Army Chief Deepak Kapoor on Friday said the number of ceasefire
violations by Pakistan Army has increased to enable militants to
infiltrate into India before the onset of winters to "disrupt" the
peaceful environment in Jammu and Kashmir.
"The attempts of ceasefire violation have increased
because this enables infiltration to be carried out when the firing is
on and can be used as a diversionary tactic. Their attempt is to
infiltrate more and more people during ceasefire violation but we
understand their tactics and take appropriate steps," he told
reporters.
He was asked why ceasefire violations by Pakistan have increased besides rising incidents of infiltration by militants.
"Attempts will be made by the other side to try and
disrupt the stable and peaceful environment in Jammu and Kashmir and to
push in as many infiltrators as possible before the winter sets in. It
is the trend that we are witnessing and the attempts of infiltration
are going on," he said.
Kapoor was speaking after signing an MoU between
the Indira Gandhi National Open University and the Indian Army on
providing graduation degrees to its personnel below officer ranks
(PBORs).
India has said when there is a need to regulate the financial
market, the same should not be used to devise any kind of
protectionism.Agencies report.
"We shall have to strike a balance. First of all, I
would like to... in the name of the financial regulation and to
regulate the markets and as I started off, I mentioned protectionism
need not come. Yes, there is a need of regulating the financial
market," Finance Minister Pranab Mukherjee said in an interview.
"At the other side of the picture, these
instruments need not be used to devise protectionism in some forms.
Therefore, there too, we shall have to keep in view the federal
reserves -- the larger social interests – interests of the society as a
whole, not fragmented and fractured internally," he said.
Noting that there is no consensus among major
economies on the lessons learnt from the current global economic
crisis, Mukherjee said: "But if we look at the way G-20 responded and
we have ourselves been made to address only those issues where there is
the possibility of consensus."
The Finance Minister felt that G-20 should not
pick up those issues where consensus is elusive. "That there should not
be, in the name of financial agreement...it should not be too much
constructionist policies in the grab of another form of protectionism,"
he said.
Responding to a question, Mukherjee said India
shall have to come back to the fiscal conservatism. "That's why in my
medium term plan, I have indicated that I am ending the year with a 6.8
per cent of fiscal... but I will come around to 5.5 and four per cent
in the next two years," he said.
Forex kitty swells $4.4 b on $4.8-b IMF largesse
Economic Times reports:
A $4.8-billion largesse by the International Monetary Fund (IMF), by way of
general allocation of special drawing rights (SDR) — reserve
IMF used for paying IMF loans — has helped push India's foreign exchange
reserves up by $4.4 billion during the week ended August 28. This is the third
time since it was formed that IMF has made fresh allocations of drawing rights
to member nations.
According
to the latest figures released by RBI, total foreign exchange reserves rose
$4,405 million to touch $276.4 billion. While foreign currency
The value of
SDR is a weighted average of a basket of currencies comprising the US dollar,
the sterling pound, the yen and the euro. The weights assigned to the currencies
is revised regularly, depending on their prevailing relative importance in
global markets. The value of gold in reserves remained unchanged during the
week.
Under its Articles of
Agreement, IMF may allocate SDRs to members in proportion to their IMF quotas.
Such an allocation provides each member with a costless asset. Decisions to
allocate SDRs have been made three times.
The first allocation was for a
total amount of 9.3 billion, distributed in 1970-72 in yearly instalments. The
second allocation for 12.1 billion, was distributed in 1979–81 in yearly
instalments. The third general allocation was approved on August 7, 2009 for an
amount of SDR 161.2 billion, which took place on August 28, 2009.
In other developments, the
central government has parked Rs 31,462 crore of unspent funds with RBI during
the week ended August 28, even as there are concerns over the high borrowing
costs of the government. The government has also not drawn under its ways and
means advances (WMA) account — an overdraft facility with RBI.
While borrowings within the
limit is at the prevailing repo rate, borrowings above the agreed limit (between
the government and RBI) is at 2% higher than the repo rate. State governments on
the other hand have reduced their outstanding WMA to Rs 90 crore as on August
28.
assets dipped
$415 million, SDR allocation amounted to 3,082 million, which is equivalent to
$4,821 million.
CPM axe on land deal with Vedic, reports BISWAJIT ROY in THE TELEGRAPH, Kolkata, 5th SEP 09:
he CPM today asked the government to
scrap its joint venture for an infotech township project with the Vedic
Village promoters “after examining the legal constraints”.
At
the same time, the party’s state secretariat felt the government should
purchase land at Rajarhat for Wipro and Infosys, which had been
promised plots in the proposed township.
Today’s
meeting of the party’s highest decision-making body at the state level
had become stormy over fixing responsibility for entering into ventures
with “unscrupulous land-grabbers” and finding a way out of the Vedic
mess.
IT
minister Debesh Das was summoned to explain the implications of
scrapping the 1,200-acre township deal between government-owned Webel
and companies floated by Vedic Village managing director Raj K. Modi
and his associate, Amarnath Shroff.
CPM state secretary Biman Bose refused to disclose the decisions. “The government will spell out its position,” he said.
A
secretariat member said: “The government can’t be part of a project
where the private partners are unscrupulous realtors. We can come out
of the deal since the Vedic people violated the agreement by grabbing
land at gunpoint.”
There
was a different view, too, represented by industries minister Nirupam
Sen and Das. They implored the government not to throw the baby out
with the bathwater. A grim-faced Sen refused to speak as he left the
meeting but the chief minister apparently agreed to explore the
possibility of purchasing land for the IT companies.
Senior
secretariat member Benoy Konar said: “It will be a disaster for efforts
to promote IT if the township project is abandoned completely. Debesh
(Das) also told us that big IT companies like Wipro and Infosys will
take strong exception if we can’t honour our commitment to provide
land.”
Konar
added that the two companies had said they wouldn’t like to be part of
the land deal with the Vedic Village promoters. Nor do they want to buy
directly.
“The
government will try to purchase land in the Rajarhat area. In the
meantime, legal aspects would be examined before taking the formal
decision,” he said.
Housing
minister Gautam Deb, who along with Bose and Md Salim, the former MP,
argued for the project to be scrapped immediately to spare the party
and government further embarrassment, said: “The matter has been left
to the chief minister.”
http://www.telegraphindia.com/1090905/jsp/frontpage/story_11454539.jsp
Pak is epicentre of terror in the region: Krishna
Accusing Pakistan of not being serious in
punishing perpetrators of the Mumbai terror attacks, External Affairs
Minister S M Krishna said on Saturday that India has provided enough
evidence for their prosecution.
He also made it clear that Pakistan was to be blamed
for the suspension of the composite dialogue after the 26/11 terror
strikes and said it has to take the initiative for the resumption of
the process.
"According to legal experts, the six dossiers
which we have provided to Pakistan contain enough evidence against the
conspirators, abettors and perpetrators of the Mumbai terror attacks to
get them punished in a court of law," he told reporters here.
"If Pakistan were to be serious about taking the
logical steps to punish those responsible for the attack on India or
Mumbai, this is an instance that they can show to the world and India
that they are serious," he said.
The Minister said India has given to Pakistan the names and other details of those involved in the strikes in Mumbai.
"It is but natural that they should arrest all those and bring them to justice," he said.
Krishna said New Delhi will keep engaging Pakistan
on the "logical follow up" that should be taken. "We expect that it
will be done," he said.
Asked about Pakistan Foreign Minister Shah Mahmood
Qureshi's remarks that India is not coming forward for resumption of
talks, Krishna said, "India was happily continuing with its composite
dialogue till the Mumbai attacks which abruptly ended, temporarily, the
composite dialogue."
"So, I think Pakistan has to blame itself for the
suspension of the composite dialogue and again it has to be Pakistan's
initiative now to satisfy India's requirement for the resumption of
composite dialogue," he said.
The Minister said India is fully aware that
Pakistan is the "epicentre of terror in this region". This, he said,
has been brought to the notice of Pakistan as well as friendly
countries.
On a question about incursion by a Chinese
helicopter in Leh sector recently, Krishna sought to downplay the
incident saying there was an in-built mechanism to deal with such
issues.
"Whenever they take place this mechanism comes into operation and things are settled," he said.
WFP, WMO agree to share climate data
http://www.expressindia.com/latest-news/WFP-WMO-agree-to-share-climate-data/513328/In an effort to fight hunger and address
the issue of food shortage, the World Meteorological Organization (WMO)
and the World Food Program (WFP) have agreed to share data on climate
change and weather patterns.
WMO data concerning floods, hurricanes, mudslides,
drought and other forms of severe weather can give WFP a critical
advantage in helping communities to prepare and react to such impacts
of climate change those damage crops, homes and lives, the two UN
agencies said yesterday.
A memorandum in this regard was signed recently,
according to which WFP and WMO will broaden collaboration on the
collection and use of complex weather data, which the food agency
analyses for its emergency preparedness, disaster risk reduction and
vulnerability assessment efforts in the field.
"Climate change is a crisis multiplier," said WFP Deputy Executive Director Staffan de Mistura.
In countries affected by conflict or the double
blow of the financial and food price-hike crises, climate change
intensifies the suffering, he said.
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Pak is epicentre of terror in the region: Krishna
India slams attack on Indian priests in Pashupatinath
Air India constitutes 4-member probe committee
China to assist Pak launch its first satellite
Need to regulate financial market but no protectionism: Pranab
'Pak making qualitative, quantitative improvement to nukes'
Delhi University gets first 'Independent' Prez in 18 yrs
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WFP, WMO agree to share climate data
Europe calls on G20 to tackle bonuses
India's stand on protectionism endorsed
Delhi Ministerial agree to revive WTO talks
Farmville is 'most popular' Facebook application
Renewable energy certificate gets nod
TII to expand business with new products
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Big B plays Bigg Boss | |
| OUR BUREAU | |
Mumbai/Calcutta, Sept. 4: Amitabh Bachchan will make a comeback on television screens after three years as the host of reality show Bigg Boss on the channel Colors. Shilpa Shetty had anchored the show in its first season on the channel. A Bachchan, 66, will be called the Pop Philosopher. “He Last The channel refused to reveal the telecast date of the new season but did say that it would premiere before the end of the year. “Signing on Mr Bachchan for Bigg Boss is part of the channel’s overall strategy to reclaim the number one slot,” said a channel source. Colors, which beat STAR Plus to the number one slot soon after its launch last year, has slipped in the ratings since. “The first promos of the show with Mr Bachchan are ready and they will be aired from Monday,” said the Colors official. Shilpa says in her blog: “Amitji will host the next season of BIGG BOSS and people want to know how I feel… “So She Unlike the previous series, which began with Arshad Warsi on Sony, the new season of Bigg Boss Bachchan’s last television appearance was on the hugely popular show Kaun Banega Crorepati that Shah Rukh Khan later hosted. | |
 |
CPM divided over ‘action’ on Mollah Not illegal for some, immoral for others | ||
| OUR SPECIAL CORRESPONDENT | ||
Calcutta, Sept. 4: “Why According But According to this section, the party will decide on Mollah after state secretary Biman Bose returns from Delhi. The “We Bose refused to speak on Mollah before leaving for Delhi today. Insiders Mollah “Several “Similarly, The panel comprising his department’s officials has to submit its report in a month. Power plant plot The |
Mamata wants damages | ||
| OUR SPECIAL CORRESPONDENT | ||
Calcutta, Sept. 4: “The Tuesday’s Land Trinamul Some In A | ||
|
Maoist ‘trial’ for Trinamul leaders |
| OUR CORRESPONDENT |
Midnapore, Sept. 4: Maoists Tarun Tarun, Trinamul Tarun Tarun The The leaders fled after circulating the papers. West |
Window open for US pact | ||
| JAYANTA ROY CHOWDHURY & R. SURYAMURTHY | ||
New Delhi, Sept. 4: “We The US official hinted that while a free trade pact with India was not yet in the offing, it was a long-term goal. Bilateral While Two India Kirk |
Trade impasse ends - WTO members to resume talks | ||
| OUR SPECIAL CORRESPONDENT | ||
New Delhi, Sept. 4: The US Differences India’s “The The The However, |
Well-marked ‘low’ sustains active monsoon conditions
Vinson Kurian
Thiruvananthapuram, Sept. 4
The well-marked low-pressure area over northwest Bay of Bengal and
adjoining coastal Orissa has become the hub of the currently active
monsoon phase even as spokes extended to it from other parts of the
country.
CYCLONIC WHIRLS
But the potency of a prevailing western disturbance acting in tandem
with a trough in the mid and upper-level westerlies may have eclipsed
the others, according to an India Meteorological Department (IMD)
update on Friday.
The rest were cyclonic circulations traced to over east Uttar
Pradesh, Madhya Maharashtra, Jammu and Kashmir and Punjab that spun
about their axis but ‘in formation’ with each other to bring large
parts of the country under rain cover.
The offshore trough extending from Maharashtra to the Kerala coast took care of the west coast.
According to the Noida-based National centre for Medium Range
Weather Forecasting (NCMRWF), the well-marked ‘low’ system is likely to
intensify further and move slowly to the west-northwest.
Under its influence, heavy rainfall is expected over Orissa,
Chhattisgarh, coastal Andhra Pradesh, Vidarbha and Madhya Pradesh
during the next three-four days.
The IMD forecast indicated an eastward (India)-bound cyclonic
circulation over south Pakistan that beckoned from across the northwest
border even as predecessor trough in the westerlies ran down to west
Madhya Pradesh.
While doing so, it passed through western parts of Jammu and
Kashmir, Punjab and east Rajasthan. This resulted in the incursion of
moisture from the Arabian Sea to the southwest to bring heavy rains
over the region.
The monsoon has been vigorous over Konkan, Goa and coastal Karnataka
while being active in Haryana, Himachal Pradesh, east Rajasthan, west
Madhya Pradesh, Gujarat and Madhya Maharashtra during the 24 hours
ending Friday morning.The land-based northwest-to-southeast seasonal
trough passed through Bikaner, Alwar, Fatehpur, Daltenganj, Jamshedpur
and the centre of the low pressure area before dipping into
east-central Bay of Bengal.
Model prediction suggests that the eastern end of monsoon trough is
likely to remain south of its normal position during next 3-4 days as
well, which is favourable for the rain regime to sustain.
Fairly widespread rainfall activity with isolated heavy to very
heavy falls has been forecast along the west coast during the two days.
The rains are likely to increase over east India from Sunday onwards.
Forecast for Monday to Wednesday specifically spoke about the
possibility of fairly widespread rainfall over east and central India
and the Andaman and Nicobar Islands.
ACTIVE IN SOUTH
The Chennai Met Centre said in an update that the monsoon has been
active over Karnataka during the 24 hours ending Friday morning.
Rainfall occurred at most places over coastal Karnataka and Kerala;
at many places over interior Karnataka; and over coastal Andhra Pradesh
and Telangana.
Isolated rainfall was reported from Tamil Nadu, Rayalaseema and Lakshadweep.
Forecast
for the next two days said that rain or thundershowers are likely at
many places over Karnataka, Kerala, Telangana and north coastal Andhra
Pradesh; and over south coastal Andhra Pradesh, Rayalaseema and
Lakshadweep. Isolated rain or thundershowers are likely over Tamil Nadu
and Puducherry.
A warning valid for the period spoke about the
possibility of isolated heavy rain over coastal and south interior
Karnataka, Telangana and north coastal Andhra Pradesh.
Home Ministry cracks the whip on SIM cards
| DoT asked to ensure Security Accreditation compliance. |
The Ministry’s move is part of its efforts to tighten the security of communications network in the country.
Thomas K. Thomas
New Delhi, Sept. 4
After cracking down on telecom equipment vendors, the Ministry of
Home Affairs has now asked the Department of Telecom to ensure that
mobile operators strictly follow the Security Accreditation Scheme
(SAS) when they purchase SIM cards from foreign vendors.
SAS is a global programme voluntarily managed by the GSM
Association, the international body set up to promote GSM technology
worldwide.
Under this certification there are 20 SIM card manufacturers globally accredited by GSMA. Out of these 20, six are from China.
Crux of problem
The MHA move is part of its efforts to tighten the security of
communications network in the country. However, the problem is that out
of the 20 SIM card vendors certified by GSMA, there is only one player
which is SAS-compliant. Therefore, the DoT has told the MHA that
mandating SAS accreditation in India may not be useful as it may lead
to a monopolistic situation in the market.
“Moreover, it may not be desirable to mandate anything which is
voluntary in nature and has very limited eligible candidates. This is
not a fool-proof solution,” stated a DoT note on the issue.
The MHA has also sought directions from the DoT making it mandatory
for operators to obtain a certificate with every supply of SIM cards,
that security keys generated at the time of personalisation are secure
and held in the custody and control of an Indian company with an Indian
Chief technical Officer only.
Security agencies have expressed concerns that any foreign vendor
can embed malware into the SIM, which can then be used to control the
network from locations outside India.
‘Misplaced concerns’
However, the DoT officials said that the concerns of the security
agencies may be misplaced since the possibility of network failure due
to anything done on SIM cards is very rare. Moreover, all operators do
thorough testing of SIM cards before deploying these on their network,
as the spurious software sitting on SIM card can not only create
revenue loss to the service providers, but also disturb the delivery of
services.
The MHA had earlier asked mobile operators to be careful while
purchasing network equipment from foreign players, especially those
from China. The primary concern is that the Chinese could control
mobile networks in India through spyware embedded in the equipment,
which can then be used to snoop on communication networks or even
switch them off in emergency situations. The DoT is expected to come
out with detailed guidelines on this issue after consultation with the
MHA.
More Stories on :
Telecommunications |
Security
http://www.thehindubusinessline.com/2009/09/05/stories/2009090550531600.htm
Renewable energy certificate gets nod
| Font Size |
Sanjay Jog
Posted: Sep 05, 2009 at 0138 hrs IST
Mumbai Power regulators under the ageis of Forum
of Regulators (FoR), on Friday unanimously gave their consent for the
introduction of renewable energy certificate (REC) to be exchanged only
through power exchanges approved by the Central Electricity Regulatory
Commission. The REC would be exchanged within forbearance price
(ceiling price) decided by CERC time to time, not exceeding the
forbearance price. Moreover, FoR was of the view that RE generators are
not allowed to bank more than 25% of REC for the next year. FE had
reported last week that FoR was to decide the fate of the REC at its
meeting on Friday.
FoR also decided to carry out a study to suggest
minimum percentage of procurement from RE sources by states as decided
by state electricity regulatory commission (SERC). FoR was unanimous
that REC should be treated as valid instrument for renewable power
obligation (RPO). However, regulators were of the view that RPO
potential and its impact should be assessed. So far Tamil Nadu and
Karnataka have made 10% of RPO in their respective states. But
regulators asserted that such a percentage would not be possible in
states like Delhi and Harayana where renewable potential is low.
CERC chairman Pramod Deo told FE “The issue of
renewable purchase obligation by states can be discussed at the
National Development Council where the centre can convince states. Such
a debate at the NDC level is necessary as states will seek funds for
meeting renewable purchase obligation.” Deo said once the renewable
purchase obligation is decided by SERC it will be reflected in tariff.
He added thus FoR took a decision to conduct a study on assessment of
RPO in states and its impact on states and also on consumers in
general.
According to the model regulations for SERC under
86 (1) (e) of the Electricity Act, 2003, SERC would direct obligated
entities to create separate entities to create separate fund in case of
default. The amount would be equivalent to the amount req-uired for
purchase of REC shortfall at forbearance price (maximum price) of REC
in a separate fund. SERC may nominate an officer from state nodal
agency for procurement of shortfall of REC. Fund would be utilised
partly for the purchase of REC and partly for develoment of
infrastructure for evacuation of power from RE sources.
http://www.expressindia.com/latest-news/Renewable-energy-certificate-gets-nod/513002/
Auto industry gears up for a new tax regime
| Font Size |
Waman Parkhi
Posted: Sep 05, 2009 at 0146 hrs IST
The auto industry is sensitive to the changes in the economy as
well as fiscal policy and is accepted as the barometer of economic
well-being of a country. The imminent introduction of the goods &
services tax (GST) replacing central excise duty, service tax, state
value-added tax (VAT) and central sales tax (CST) may change the way
business is done today.
The practice in this industry is to sell vehicles to a
dealer network that sells as well as services the vehicles. More than
80% of the sales is generally outside the state of manufacture. The
distribution of the vehicles may be by way of direct sales to dealers,
currently subjected to CST or by stock transfers to depots and
stockyards across the country. Both these models entail a tax cost,
which gets embedded in the final price to the customers. Though the
rate of CST on inter-state sales is a mere 2%, it breaks the credit
chain as CST cannot be set off by the dealer against his VAT liability.
Similarly, though stock transfers are not eligible to tax, state VAT
laws provide for retention or reduction of input tax credits.
The GST regime is expected to overcome this and
provide an ninterrupted credit chain. GST, being a consumption tax, is
likely to accrue to the state of consumption of goods irrespective of
the state of sale. This represents a fundamental shift in the point of
taxation from the earlier origin-based taxation system. Though the
modalities of collection and transfer to the consumption state are not
clear at this stage, it would certainly entail a change in tax costs in
the supply chain.
Currently, stock transfers do not attract any tax
(other than the loss of input tax credit in the exporting state). It is
possible that GST would be applicable on all ‘supplies’, including
stock transfers. This would have its own challenges. The valuation of
such stock transfers have to be tackled as there would be no sale value
available to calculate tax. There could be significant cash flow issues
as well, if tax is to be paid upfront on all stock transfers. Special
transition provisions will be required for the in-movement stock from
factory to depot on the date of introduction of GST.
Most of the new investments by auto companies have
gone to the states that have offered most competitive tax incentives.
Such incentives are largely in the form of subsidies/loan equal to the
VAT/CST paid in the state. These arrangements will have to be relooked
by the state governments. For instance, under the GST regime, the state
of manufacture will not collect any tax (that is, CST) on inter-state
supplies. It needs to be seen as to how the existing incentives (in
terms of CST exemption/deferral) can continue. Current benefits given
under central excise law in states such as Uttarakhand, Himachal
Pradesh etc would also need to be relooked at.
One of the reasons for auto component
manufacturers to set up units close to OEM plants is to avoid breaking
of the VAT credit chain. The removal of CST in the new regime would
provide a new opportunity for consolidation of these units into larger
units, which would be good for economic efficiency of the sector as a
whole.
If the GST rate is fixed anywhere between 16-18%,
as being discussed currently, it may be a good news for the industry.
The current effective rate works out to be more, particularly for the
bigger cars, where the excise duty is higher. That said, GST does offer
significant challenges to the industry, as well as opportunities. The
industry needs to identify the potential issues and engage into a
proactive dialogue with the government to ensure that their concerns
are addressed.
The author is a cost accountant & former member of Indian Revenue Service
NO SMALL FIGHT |
Year-on-year, quarterly gross domestic product growth shows a slight rise to 6.1 per cent from the depressing 5.8 per cent it showed in the previous two quarters. This rise has led to an outburst of optimism. The prime minister told the Planning Commission that the global economic downturn was ending and that normalcy would return. He also told policy-makers not to be too pessimistic. That could be a sign that things are better than how they see them — unless he was merely cheering them up. He could have been referring to the note circulated by the Planning Commission which weighed in the effect of the drought; it said that foodgrains production could drop this year by 29 million tons, and growth could fall to 5.5 per cent. What is known with certainty is the past; and the past is known only up to April-June this year, to which the latest GDP figures pertain. They show an uptick in mining, manufacturing and public utilities — precisely the sectors that had led the slowdown. That suggests its end. The figures also show a fall in the contribution of the government to GDP growth; this suggests that the figures are not being artificially inflated by unproductive government expenditure. So the possibility can no longer be dismissed that there is a genuine upturn. That is how it looks if the focus is on GDP figures ignoring the rest. The trade figures were released at the same time as GDP figures, and they tell a different story. Monthly goods exports were below the previous year’s figure for the tenth month running; in the past five months, they have been almost a third lower than the year before. If they had not fallen, GDP would have been four per cent higher. That is an exaggeration, since imports too would have been higher. The point is that there is one sector of the economy that has done extremely badly; so have those whose livelihood depends on exports. Almost half the gem-cutters have lost their jobs; so have a third of garment makers. Their woes do not figure high on the radar of the finance ministry or the Planning Commission. For most of the exporters are small; while politicians pay them homage on appropriate occasions, they are simply not present in the corridors of power. Unbeknownst to the men in power, those small enterprises have been doing their best — to save themselves more than the nation; they have fought back. According to the Reserve Bank of India’s figures, merchandise exports have fallen much less than imports. So, the trade deficit halved in January-March 2009 in comparison to the previous quarter. Exports of services, including information technology, have also been sustained well. It is a pity that these small exporters are just the people whom the trade policy, replete with red tape, serves least well. |
In Vedic age, money mantra - Buddha stresses probity on eve of secretariat meet | |||||
| OUR BUREAU | |||||
Calcutta, Sept. 3: Money — that bewitching temptress of capitalism — was put to generous use by Buddhadeb Bhattacharjee today to rub salt into the wounds of opponents lacerated by the Vedic Village controversy. “Chaaridikey taka, prochur taka. Taka shudhu urchhe. Ei taka thekei ashchhe annay, ashchhe paap (all around you there is money, a lot of money. Money is flying around. From this money springs wrongdoing and sin),” the chief minister told a condolence meeting today without making any mention of Vedic Village. The chief minister’s thrust on probity coincided with the raging controversy involving Vedic Village and Abdur Rezzak Mollah, the land and land reforms minister who finds himself at the receiving end after having targeted Bhattacharjee for the past few years on land acquisition for industry. The comments also came on the eve of the CPM’s weekly state secretariat meeting where, sources said, Mollah could be called if clarifications are needed on his report on an out-of-court settlement with the Vedic promoters. But Mollah said that till this evening, he had not received any summons. If Mollah had ridden the moral high horse till the Vedic controversy broke, the reins were seized by Bhattacharjee today at the meeting to mourn the death of Pranab Sen, a CPM theoretician close to the chief minister. Bhattacharjee dwelt at length on the “simple life and high ideals” of Sen who died last month. “It is very important to be strong enough to resist temptation and stand by one’s political ideology. A communist is no more a communist if he deviates from his political ideology. In Pranabda, we find all such exceptional qualities and we must all emulate him,” Bhattacharjee said. The chief minister was referring to Sen but if some in the audience thought he had the Vedic Village controversy on his mind, they cannot be blamed. Mollah’s department had entered into the agreement with the Vedic Village promoters to lease them land for a song, although there was no legal compulsion to do so. The minister had also said he had visited the resort’s spa a number of times for treatment. Bhattacharjee kept returning to the theme of probity in public life. The chief minister said Sen used to oversee his election campaign in Jadavpur. “Pranabda used to take all decisions regarding expenditure of the funds allotted to me as an MLA and I was often informed later. Everybody will miss him,” Bhattacharjee said. Sharing the dais with Bhattacharjee were Somnath Chatterjee, the former Speaker expelled from the CPM, and a host of other party leaders. Chatterjee also mentioned the late Sen’s “honesty and integrity all through his life”. “We all honour Pranabbabu’s simple and honest life. He set an example for all of us,” he said. Chatterjee, who fell out with the CPM’s central leadership, particularly general secretary Prakash Karat, continues to be in close touch with the party’s Bengal functionaries. It was Bhattacharjee who requested Chatterjee to take the seat next to him when the latter appeared hesitant. All other leaders present, including Rabin Deb, Sujan Chakraborty and Kanti Ganguly, got up from their seats to exchange pleasantries with Chatterjee. Chief minister Bhattacharjee will skip the CPM politburo meeting in Delhi, scheduled from Saturday for two days. “He is unwell and feeling weak. But he will attend the secretariat meeting,’’ an aide said. But CPM sources said Bhattacharjee had decided to stay back in Calcutta to deal with the Vedic issue and could break his silence after the state secretariat meeting tomorrow. This evening, Mollah pooh-poohed questions whether he was thinking of resigning. “Why should I resign? I am sticking to my position that I am clean. Neither am I going to oblige anybody nor has the party asked me,’’ he said. The state secretariat is also likely to discuss reports from IT minister Debesh Das and urban development minister Asok Bhattacharya on the IT township project with the Vedic promoters. A pending issue before the secretariat is finalising the names of new members. Had the Vedic controversy not unfolded, Mollah would have been a surefire nominee. It is not clear whether the secretariat will take up the issue tomorrow, and the party may not want to acknowledge in public any link between the non-inclusion of Mollah and the Vedic issue. Front-runners to fill the secretariat seats include Rabin Deb, Rajya Sabha MP Mainul Hassan, Hannan Mollah and Nilotpal Basu.
|
FUNDAMENTAL QUESTIONS - The BJP has to open its doors to diverse currents and interests | |
| Swapan Dasgupta | |
Earlier this week, a BJP-watcher in the media proffered the novel suggestion in a web article that the Rashtriya Swayamsevak Sangh chief, Mohan Bhagwat, should hold concurrent charge of the Bharatiya Janata Party. “I would go a step further,” she wrote, “and state that since he is so clearly the Brahma-Vishnu-Mahesh of the BJP/RSS he should also take-over the constitutional post of Leader of the Opposition … In fact, Bhagwat should eventually consider being Leader in both the Lok Sabha and Rajya Sabha but since that would involve amending the Constitution of India he should first focus on fixing the BJP Constitution to ensure him unlimited power and authority that he seems to enjoy anyway.” Since irony and sarcasm in the English language tend to go largely undetected, this plea for one-man-all-posts could well be interpreted as a logical extension of Arun Shourie’s theatrical pronouncement that the RSS should “take over” the Bharatiya Janata Party. Conversely, since Bhagwat has affirmed many times over in his media interactions that the RSS is merely a “cultural organization” that doesn’t give gratuitous advice to the BJP, many will view the suggestion as simply insolent. It is difficult to anticipate how the RSS will react to the suggestion that it shed all pretence and assume a formal political role. It is said that Sardar Vallabbhai Patel once suggested precisely such a course to “Guruji” M.S. Golwalkar, the iconic, second RSS chief. It was rejected because Golwalkar believed that politics is a “cesspool” and jumping into it would contaminate the RSS’ s larger “nation building” project. Since then, keeping an arm’s length from politics has defined RSS orthodoxy. This detachment, however, has never negated the discreet advice of the organization to its swayamsevaks in public life. Occasionally, as happened during the tenure of K.S. Sudarshan, the distinction between advice and instruction was almost obliterated. Despite Bhagwat’s denial that the RSS was assuming charge of the BJP, there is an impression that last week’s crisis management sessions in Delhi resulted in a coup and the quiet transfer of control of the BJP from the politicians to the RSS. L.K. Advani’s resignation from the post of leader of the Opposition — a post he unwisely held on to after the May 16 defeat — is now a foregone conclusion, as is the non-renewal of Rajnath Singh’s term as party president. More to the point, the RSS appears to have indicated that it has no confidence in the ability of the BJP’s second-rung leadership to steer the party out of its present disarray. The RSS has mounted a global search for a new face who can undertake the party re-building project. The choice may well be a politician (even one with a mass base), but real decision-making will be vested in the hands of full-time RSS pracharaks on deputation from Nagpur. As things stand, the organization secretaries (deployed at all levels) undertake party responsibilities, but are not subject to the political control of the party. Their appointments and removal are the sole responsibility of the RSS. It is undeniable that many despondent BJP workers, perhaps a majority of them, have reacted favourably to the RSS chief assuming a pro-active role. The impression that a fractious and ambitious bunch of politicians were incapable of extricating the BJP from the depths to which it has sunk may be over-simplistic, but at the same time it was very real. Since the RSS chief wields both moral and organizational authority within the larger sangh parivar, his no-nonsense intervention has been heartily welcomed, even if it involves replacing dual control with just one power centre. A comparison of the RSS “takeover” with a military coup ostensibly aimed at saving “the nation” from democratic turbulence is irresistible. The problem with authoritarian solutions in argumentative societies is that the immediate exhilaration at the restoration of order is invariably replaced by long-term disappointment. Apart from a mismatch between the Sergeant-Major mentality and competitive politics, the honest brokers soon find themselves sucked into the role of participants. The RSS should know the feeling. In 2006, after Advani was removed as party president following his controversial remarks on Jinnah, the RSS sent some 250 pracharaks into the BJP to bolster the organization. They were appointed organizing secretaries at the Central and state levels and the 2008 Uttar Pradesh election was managed almost entirely by pracharaks on special deputation. The overall experience wasn’t happy. Apart from the uneven quality of personnel deployed, the image of the RSS as a distant moral authority was subsumed by the emergence of the RSS as a faction, often at loggerheads with mass politicians. The factionalism in Gujarat, Uttar Pradesh, Bihar, Uttarakhand and Rajasthan were a consequence of troubles fermented by those who claimed to speak in the name of the sangh. If the process of pracharak implantation is speeded up without a thorough assessment of the past experience, there is a possibility that the BJP could witness even more strife and major desertions. Bhagwat needs to be mindful that greater RSS control of the BJP is a high-risk strategy. Secondly, an unstated feature of the RSS intervention is the belief in the vanguard role of the RSS and the superior qualities of those who have dedicated themselves full-time to the sangh. Compared to the “lateral entry” politician who is in the BJP because it is the most meaningful non-Congress formation, the swayamsevak is projected as something akin to a chosen people. Apart from the sheer arrogance of a belief that casts all those who didn’t attend shakhas as lesser beings — and this includes every woman — this caste system runs counter to the very purpose of a political party — to win the support of the majority and create a representative leadership profile. The cultivation of enhanced self-worth may be necessary to nurture commitment to a religious order or a brotherhood, but political leadership cannot be settled on the strength of Indic versions of the old school tie and membership of a Masonic Lodge — at least not in a 21st century where hierarchies are constantly being unsettled. The fundamental question the BJP has to address is: why is it in existence in the first place? If upholding Hindu interests is its main leitmotif, it is not dissimilar to a grander version of the Majlis-e-Ittehad-ul-Musalmeen, which controls the Muslim ghettos of Hyderabad and routinely wins a Lok Sabha seat. The MIM, an offshoot of the original Razakars, resonates with nostalgia for a lost sovereignty and an eroding high culture. It will always be a factor in Muslim politics of the Deccan but a non-starter in all calculations of governance. If the BJP wishes to be a party aspiring to some 80 Lok Sabha seats, with a presence in the Hindi-speaking states, it can persist with the cohesiveness of the erstwhile Jana Sangh. If its ambitions are greater and it seeks to challenge the Congress’s all-India presence, it has to open its doors wider to diverse currents and interests. The RSS is an important input into the BJP, but it is not the only input. If the BJP wishes to mirror the richness of the nationalist experience, it must become a Kumbh Mela of diverse tendencies. With his stature and goodwill, Bhagwat can play a constructive facilitator of such a process. However, the creation of “structures and procedures” he has repeatedly stressed must be premised on the principles of inclusiveness, accommodation and, above all, competence. A one-size-fits-all approach based on loyalty is too eerily reminiscent of the failed ideologies of the 20th century. |
Core capital area plan cleared |
| AMIT GUPTA |
Ranchi, Sept. 4: Besides, two new capital areas have been approved based on a proposal received from the state urban development department. The Cabinet Urban In Police The The While |
|
Army chief flashes Pak sneak-in alert | ||
| OUR SPECIAL CORRESPONDENT | ||
New Delhi, Sept. 4: His “This The One Prime Today, Saeed proof New Official | ||
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More stories in Nation |
| • Cry for Jagan as CM • Women rights ruling from SC • BJP lowers flag first time for a rival • Big B plays • Bihar to replace old chopper • Maoists kill four villagers • HC lifts Jaswant book ban • A Lone but no quitter • Congress gets Reddy with Jaipal • Woman car thief caught • Army chief flashes Pak sneak-in alert • Multiple-choice test plan on CBSE table • PMO wakes up to 100-day deadline • Groundwater floods desert city • Pashupati • Coastal security push • JD-U declares summons 'illegal' • Forget Oscars, these slumdogs want a world cup |
SYLVAN JOY DIMINISHED - Politicians and peasants are a deadly combination in West Bengal | |
| Sunanda K. Datta-Ray | |
As Mamata Banerjee’s silence over the resort that is neither vedic Vedic The The No But Mishandling One It’s But Though Meanwhile, |
Arcelor stake in Uttam Galva Mittal firm to be co-promoter | |
| OUR SPECIAL CORRESPONDENT | |
Calcutta, Sept. 4: Frustrated Uttam According The While Mittal, However, the plans have come a cropper so far. The company has not been able to acquire land either in Orissa or Jharkhand. Mittal The He Though The “With Uttam Pledged shares At The Under the deal, the two sides — the Miglanis and the Mittals — will get to appoint the same number of directors. The The threshold wasn’t spelt out in the notice to the stock exchanges. ArcelorMittal |
INDUSTRY & ECONOMY
WTO:
Delhi meeting re-opens doors on Doha Round
Trade talks to be resumed in Geneva from September 14. New Delhi, Sept
4 Trade ministers representing the broader membership of the World
Trade Organisation (WTO) on Friday lifted the logjam in the Doha Round
of trade talks to clinch a global ...
REGULATORY BODIES & RULINGS:
Tariff cap proposed on short-term power trades
New
Delhi, Sept. 4 A sharp spike in electricity prices, coming in the wake
of the looming drought situation and upcoming elections in several key
States, has prompted the regulator to crack the ...
PETROLEUM:
Petroleum Ministry proposes to hike APM gas price by 44%
77%
gas produced is sold under administered price. The Petroleum Ministry
is considering a proposal to increase the price of natural gas sold
under a regulated regime to $2.6 for every million British thermal unit
(mBtu) from $1.8/mBtu, ...
NON-CONVENTIONAL ENERGY:
Slowdown dims solar panel prices 40-50%
Inventory
build-up can brighten power project prospects. Hyderabad/Chennai, Sept.
4 Solar panel prices have fallen 40-50 per cent in the international
markets in the last 6-9 months, triggered by the global liquidity
crunch. This has led to ...
POWER:
IOC open to new tie ups for coal power project
Joint
venture with Tata Power yet to take off. Chennai, Sept. 4 With the
joint venture with Tata Power for a 1,000 MW project not taking off as
planned, Indian Oil Corporation is open to joining hands with other
private sector companies for ...
PEOPLE:
Leaders pay tributes to YSR
Hyderabad,
Sept. 4 The Prime Minister, Dr Manmohan Singh, the UPA Chairperson, Ms
Sonia Gandhi, and a host of Union Ministers, senior party leaders
across the entire political firmament, including the BJP leader Mr L.K.
Advani, joined ...
TOURISM:
Golden Chariot gets 70% bookings for TN, Kerala
Services
to new destinations likely to start by November. Bangalore, Sept. 4
Karnataka’s luxury train, The Golden Chariot, which is being extended
to cover Tamil Nadu and Kerala has seen bookings of up to 70 per cent
for the new ...
ENVIRONMENT:
CESS to co-develop oil spill model for Kerala
Thiruvananthapuram,
Sept. 4 The Centre for Earth Science Studies (CESS) has been chosen as
a participating member in a project aimed to developing oil spill
models for select locations in Kerala ...
POWER:
Karnataka industry writes to CM against power tariff hike
Consumers
not in a position to bear additional burden: FKCCI. Bangalore, Sept. 4
The Federation of Karnataka Chambers of Commerce and Industry (FKCCI)
has written a letter to the Chief Minister, Mr B. S. Yeddyurappa,
appealing to him to direct ...
SMALL SAVINGS:
Direct Taxes Code will boost savings
The
shift from EEE method to EET method will promote long-term savings..
There are several ways of cutting taxes. We can reduce the rates. We
can remove the exemptions and apply the rate to gross earnings or we
can raise the slabs for applying ...
TOURISM:
Houseboats can soon sail into Thiruvananthapuram
Works
on Kadinamkulam backwater tourism project launched. Thiruvananthapuram,
Sept. 4 The Minister for Home and Tourism, Mr Kodiyeri Balakrishnan,
has officially launched works on the Rs 2.44-crore Kadinamkulam
backwater tourism project ...
REAL ESTATE & CONSTRUCTION:
Realty stocks continue to shine
Revival
in residential segment, lower home loan rates buoy sentiment. Mumbai,
Sept. 4 Real estate stocks on Friday continued their upward march with
few showing signs of weakness in what is seen as a range-bound market
...
EVENTS:
Workshop on material handling
The
Confederation of Indian Industry( CII) Thoothukudi organised a one-day
’Workshop on Material Handling and Stores Management’. The objective
was to create awareness among employees dealing with dual functions of
material handling ...
EVENTS:
Finfest 09 begins at Manipal
The
Manipal Institute of Management, Manipal’s two-day Finfest 09 began on
Friday. A press release said here that it is an opportunity for all
young minds to participate, learn and showcase their talents at the
event. It said that there ...
PETROLEUM:
Kerosene burns a hole in PSU refiners’ finances
Loss
is over Rs 17/litre and could go up further. Mumbai, Sept. 4 Kerosene
has emerged a “huge concern” for the public sector oil refining
companies and now accounts for over 25 per cent of the projected fuel
losses of Rs 45,000 ...
WTO:
US asks emerging economies to open market for poorer peers
New
Delhi, Sept. 4 The US Trade Representative, Mr Ron Kirk, on Friday said
emerging advanced developing countries should provide more market
access to the least developed countries, as the United States has been
...
ENVIRONMENT:
China assures India solidarity in climate talks
Chennai, Sept. 4 China has assured India of solidarity with it in the forthcoming climate negotiations ...
COURTS/LEGAL ISSUES:
Transfer of property by insolvent person not void
Sale
ahead of adjudication is protected: HC. Chennai, Sept. 4 Is transfer of
property by a person who was adjudged insolvent within two years after
the date of the ...
PSU:
Govt to look at listing PSUs to unlock value, says Divestment Secretary
New
Delhi, Sept. 4 Listing of unlisted public sector undertakings (PSU)
will clearly receive “more emphasis” from the Department of
Disinvestment when it goes about implementing the Government mandate on
disinvestment in the ...
EDUCATION:
IIM-A readies proposal for pay hike
Ahmedabad,
Sept 4 Following the footsteps of the Indian Institutes of Technology,
the Indian Institute of Management - Ahmedabad has readied a draft
proposal for reworking the pay structure and remove disparities in the
salaries of its ...
EVENTS:
IIM-K finance summit begins today
Kozhikode,
Sept. 4 The Indian Institute of Management Kozhikode (IIM-K) will hold
its annual finance summit, ‘Arthanomics 2009’, on September 5 ...
INFRASTRUCTURE:
Karnataka focuses on infrastructure development
Bangalore,
Sept. 4 Karnataka is focusing big on infrastructure development, if the
plans and projects in the pipeline are anything to go by. According to
Mr V. Madhu, Principal Secretary – Infrastructure Development
Department, ...
ENVIRONMENT:
‘Firms must double pace of CO2 reductions to avoid climate change danger’
Thiruvananthapuram,
Sept. 4 Based on current reduction targets, the world’s largest
companies are on track to reach the scientifically recommended level of
greenhouse gas cuts by ...
EDUCATION:
Market scenario makes IIM-B reach out to alumni for funds
Bangalore,
Sept. 4 IIM-Bangalore is drawing up a road-map to raise funds from its
alumni network and use the resources for research and ...
INCOME TAX:
‘Top income-tax rates to rise globally as Govts seek to fund budgetary spending’
New
Delhi, Sept 4 The global trend of declining top personal income-tax
rates over the last seven years may end as Governments seek money to
fund the spate of stimulus packages and budgetary spending announced
due to the global ...
POWER:
‘Some industries may move out of State’
Bangalore,
Sept. 4 Just when the Chief Minister, Mr B. S. Yeddyurappa, is trying
to project Karnataka as an ideal investment location ahead of its
global investors’ meet scheduled in January 2010, the Federation of
Karnataka Chambers ...
FOREIGN DIRECT INVESTMENT:
Karnataka expects Rs 2-lakh cr investment during investors’ meet
Mangalore,
Sept. 4 Karnataka is expecting investments to the tune of Rs 2 lakh
crore during the global investors’ meet, which is scheduled to be held
in January 2010, according to Capt Ganesh Karnik, Deputy Chairman of
NRI forum, ...
EXCISE AND CUSTOMS:
Cos liable for interest on wrongly taken Cenvat credit
New
Delhi, Sept. 4 The Finance Ministry has made it clear that interest
liability will arise on companies in situations where Cenvat credit had
been wrongly taken, but ...
WTO:
PM lauds participants for ending deadlock
New
Delhi, Sept. 4 Trade ministers of about 35 WTO-member countries on
Friday called on the Prime Minister, Dr Manmohan Singh, to inform him
of the progress made during the WTO mini- ministerial meeting in ...
EDUCATION:
Management institute ties up with JIS Group
National
Institute of Personnel Management (NIPM) joined hands with the JIS
Group and held industry academia interaction conclave here on Friday.
This followed the directive from All-India Council for Technical
Education (AICTE) making ...
PETROLEUM:
Gas dispute will not change purchase pact for NCR units: NTPC
New
Delhi, Sept 4 NTPC Ltd on Friday said it has resolved pending issues,
excepting one, with Reliance Industries Ltd (RIL) on the signing of a
Gas Supply and Purchase Agreement (GSPA) with the Mukesh Ambani group
company. The GSPA pertains ...
EDUCATION:
Sachiin Y. Rai, Centre Director, T.I.M.E.; Greater Noida Institute of Management
There’s
no prize for coming second, there’s only first, said Mr Sachiin Y. Rai,
Director, T.I.M.E. Institute, Greater Noida, quoting actor Al Pacino’s
inspirational speech from the movie ‘Any Given ...
EDUCATION:
New management institute
CORPORATE
MERGERS & ACQUISITIONS:
ArcelorMittal picks up stake in Uttam Galva
Mumbai, Sept. 4 ArcelorMittal Netherlands BV will step in as
co-promoter of Mumbai-based Uttam Galva Steels. The company was
promoted by Mr Rajinder Miglani in ...
OUTLOOK:
IOC open to new tie ups for coal power project
Joint
venture with Tata Power yet to take off. Chennai, Sept. 4 With the
joint venture with Tata Power for a 1,000 MW project not taking off as
planned, Indian Oil Corporation is open to joining hands with other
private sector companies for ...
NEW BUSINESS:
Essar Wildcat to drill another well for GSPC
Completes
initial testing and assessment at KG Basin site. Mumbai/Hyderabad,
Sept. 4 Essar Wildcat, the semi-submersible rig of Essar Oilfields
Services Ltd (EOSL) and part of the Essar Group, which has completed
drilling an offshore well (KG ...
NEW PROJECTS:
SAIL bargains plant-for-raw material access in Jharkhand
New
Delhi, Sept. 4 Steel Authority of India Ltd is ready to put up a
greenfield plant in Jharkhand, if access to raw material resources is
to be linked to additional investment in the ...
PERFORMANCE:
JSW Steel output up 53% in Aug
JSW
Steel has reported a 53 per cent growth in crude steel production at
521,000 tonnes in August, its highest-ever monthly crude steel
production, said a press release from JSW Steel. Crude steel production
was up 4 per cent on a sequential ...
PERFORMANCE:
Bajaj Auto’s focus on bigger 100cc bikes pays off with Discover
Mumbai,
Sept. 4 Bajaj Auto believes that the heady market response to the new
100cc Discover clearly vindicates its stand that customers in this
segment want bigger ...
NEW PROJECTS:
Ford India commissions new facilities at expanded plant near Chennai
Chennai,
Sept 4 With the launch of its affordable small car scheduled for the
first quarter of 2010, Ford India has started a step-by-step
commissioning of the new facilities at its expanded plant at Maraimalai
Nagar near here. The more ...
PEOPLE:
Malay Mukherjee to take over as Essar Steel CEO
Mumbai,
Sept. 4 The Essar Group has appointed Mr Malay Mukherjee, a member of
the Arcelor Mittal board of directors, as the Chief Executive Officer
of its steel business, effective ...
NEW PROJECTS:
TI arm to invest Rs 30 cr in Sanand car door frame plant
Chennai,
Sept. 4 TI Metal Forming, a division of Tube Investments of India,
expects to invest Rs 30 crore at its Sanand plant in Gujarat, which
would manufacture door frames for Tata’s ...
OUTLOOK:
Gas dispute will not change purchase pact for NCR units: NTPC
New
Delhi, Sept 4 NTPC Ltd on Friday said it has resolved pending issues,
excepting one, with Reliance Industries Ltd (RIL) on the signing of a
Gas Supply and Purchase Agreement (GSPA) with the Mukesh Ambani group
company. The GSPA pertains ...
PRIVATE PLACEMENT:
NCC to raise Rs 367 cr via QIBs
Nagarjuna
Construction Company (NCC) Ltd has informed the Bombay Stock Exchange
that the executive committee of board of directors approved the
allotment of 2,77,32,900 equity shares of Rs 2 each at a premium of Rs
130.46 aggregating to Rs ...
http://www.thehindubusinessline.com/2009/09/05/03hdline.htm
West Bengal govt to buy land for Railways
Romita Datta, romita.d@livemint.com
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The
West Bengal government will soon start acquiring about 500 acres of
farmland some 20km from Singur, where violent protests a year ago by
farmers and the Trinamool Congress—the state’s main opposition
party—against land acquisition forced Tata Motors Ltd to abandon its
small car project and move it to Sanand in Gujarat.
There may not
be any resistance this time because the land is going to be acquired
for the railway ministry, headed by Mamata Banerjee,―the Trinamool
Congress chief.
The Left Front government, led by the Communist
Party of India (Marxist), or CPM, won’t oppose the move as it senses a
political opportunity ahead of the 2011 assembly election.
The
rail ministry has written to the state government asking it to acquire
land under the controversial Land Acquisition Act for a railway track
between Bargachhia in Howrah district and Champadanga in Hooghly
district, 20km from Singur, according to Balbir Ram, principal
secretary of the state’s land and land reforms department.
A
privately owned narrow gauge railway track connecting the interiors of
the Hooghly district was abandoned more than 35 years ago. The new
broad gauge track will be laid to improve accessibility, explained an
official of the land and land reforms department, who did not want to
be identified because he is not authorized to speak to the media.
The
state government already owns some 150 acres in that area, the official
said. “At least 500 acres more will have to be acquired,” he added.
“Also, the state will have to reclaim from squatters most of the 150
acres it owns.”
The notification for the proposed acquisition is
going to be issued soon, with the price to be paid derived by using the
formula laid down in the Act. Under this formula, the
state government offers the average of prices at which land in the
neighbourhood has been sold over the past one year. Because people
understate the price to save on stamp duty, which is levied on transfer of ownership, the price derived under the formula does not normally reflect the true market rate.
Land
in Champadanga and its neighbourhood typically yields two-three crops a
year, and according to locals, annual income from one bigha, or
one-third of an acre, is Rs15,000-20,000. The current market price, say
farmers, is Rs9-15 lakh an acre depending on productivity and proximity
to the nearest highway.
West Bengal has seen violent protests in
the past two years over land acquisition. Besides Singur, a proposed
hub of chemical industries at Nandigram in East Midnapore district was
also relocated due to opposition by local residents.
The
Trinamool Congress supported both the agitations and benefited in the
recently held national elections, winning 17 parliamentary seats
compared with just one in 2004. In the 42 constituencies in the state,
CPM and its allies won 16, down from 35 in 2004.
“Who is going
to form a resistance group now?” asks Ashok Jana, a farmer who fears
the state government may seize his two bighas.
Samar Lohar fears losing his home because it’s close to the abandoned railway track.
“The CPM is not going to lead us, nor would the Trinamool Congress, which means we are going to lose everything,” he said.
Trinamool
Congress legislator Partha Chattopadhyay, leader of the Opposition in
the state assembly, sought to draw a distinction between this case and
that of Tata Motors.
“This and land grabbing for a private party
are not the same things,” he said. “We are not opposed to development.
In this case, land is going to be acquired for a national cause.”
Suhrid
Datta, a prominent CPM leader from Singur, who a year ago bitterly
opposed the Trinamool Congress and the farmers in their campaign
against the Tata Motors project, doesn’t seem perturbed.
“We aren’t Mamata Banerjee,” he said, when asked if his party was going to oppose the proposed land acquisition at Champadanga and its neighbourhood.
However,
CPM leaders from Champadanga are more vocal than others from the rest
of district. “They (Trinamool Congress) stopped Tata Motors from
building its factory in Singur because it was fertile land, and now
their chief wants equally fertile land for the Railways,” said Asit
Patra, chairman of the local government body of Champadanga.
But
leaders such as Patra are going to toe the line that the CPM has
decided at the highest level. “Let the people see for themselves. We
are not going to oppose development,” said Robin Deb, a CPM state
secretariat member. “But we will make sure that the compensation
package reaches everyone, even sharecroppers and landless labourers.”
http://www.livemint.com/2009/09/04215451/West-Bengal-govt-to-buy-land-f.html?atype=tp
Will Ben Bernanke succeed as the greenback’s new father?
Floyd Norris, feedback@livemint.com
- font size
Six
months after the financial world seemed to be coming to an end, the
world’s economies appear to be recovering. Banks that seemed to be on
the brink of failure less than a year ago are now able to pay back
investments made by the treasury.
It is too early to declare
victory, but the world looks much safer than it did only a few months
ago. Credit markets are recovering, to the point that the junk bond
market will have its best year ever if it manages not to lose any money
over the rest of 2009. The stock market has just finished its best six
months since 1938.
If victory is to be had, it will owe a lot to
the willingness of American policymakers to set aside cherished
policies and simply create money. And that is one reason it is
appropriate to pause and celebrate an unheralded bicentennial: The
father of the greenback, Elbridge Gerry Spaulding, who was born 200
years ago in 1809.
Spaulding was that rarest of creatures, a man
who succeeded in both business and politics; a congressman who saw a
problem coming and had a solution ready. It was he who, at the end of
1861, figured out that the US government simply needed to print money
to pay for the Civil War. It was economic heresy then, but without it
this country might not have survived.
Such an idea was then
dismissed by some as “fiat money”, money that is money not because it
is backed by gold or silver, but because some government says it is
money.
That such currencies can fail to work is obvious, as those
who lived in Weimar Germany or present-day Zimbabwe have found out. But
notwithstanding those examples, the last 20 years deserve to be
remembered as the age of fiat money. For much of that time, central
bankers were revered as heroes for engineering long booms and short,
shallow recessions.
Ben Bernanke, the current chairman of the
Federal Reserve, sometimes does not seem to understand that this
reputation has taken a hit. After he warned that “a perceived loss of
monetary-policy independence” could lead to “reduced economic and
financial stability”, he drew a taunting comment from Dean Baker, an
economist with the Center for Economic Policy and Research in
Washington.
“Maybe Mr Bernanke missed it,” wrote Baker, “but his
independent Fed gave us the largest financial and economic crisis since
the Great Depression. Does anyone really think that things would have
been worse if the Fed had been more accountable?”
Bernanke did
not miss it, of course. He may have been slow to realize how critical
the situation was, but when he did, he acted decisively. Like Spaulding
almost 150 years ago, he showed a willingness to abandon the wisdom of
an earlier time. The government lent money it did not have to financial
institutions, and bought stock in them.
http://www.livemint.com/2009/09/04215642/Will-Ben-Bernanke-succeed-as-t.html?atype=tp
Cess on Cairn oil justified
ET Bureau
The report that Cairn India, which has
recently begun production in India’s biggest oil find in over two decades,
has finally agreed to bear the
that in Cairn’s find at Barmer, Rajasthan, exploration and production
(E&P) activity was begun before the New Exploration Licensing Policy (Nelp)
was in place.
In the pre-Nelp bidding rounds there was no provision
for 100% investment by potential operators. They necessarily had to tie-up with
a licensee like state-owned ONGC to foray into E&P in the domestic
sedimentary basins. And in several small and medium sized discovered oil fields,
ONGC has continued to pay cess on output; but thanks to enhanced crude recovery
all JV partners have benefited.
However, by no stretch of
imagination can Barmer be deemed enhanced recovery. The records suggest that it
was the biggest oil find globally, in 2003. Hence it is only valid that the
operator, Cairn, meets the levies, cess and other fees due on E&P activity.
It is unfortunate that the specific production sharing contract (PSC) pertaining
to Barmer is not clear, unlike other PSCs, on the cess payment obligation of the
operator. It is, however, only proper that Cairn does pay its rightful dues on
account of E&P activity.
The cess is really an excise duty on
indigenous crude oil and natural gas output, and levied as per the Oil Industry
(Development) Act, 1974. The funds were supposed to accrue to the Oil Industry
Development Board (OIDB), but actually go to the Consolidated Fund of India. The
OIDB website mentions the current rate of cess on crude at Rs 2,500 per tonne
wef 1 March, 2006. But the fineprint says the Centre ‘in the public
interest’ has since reduced the levy to Rs 900 per tonne, for 26 producing
fields.
It is not clear what the rate for Barmer would be. But a
more reasonable cess is certainly advisable given that indirect taxes and levies
tend to be regressive. Anyway, we do need transparency in norms when it comes to
tax and attendant obligations of oil and gas producers. Otherwise, it’s
bound to dampen investor comfort, give rise to quite needless litigation and
result in endless delays in production of hydrocarbons.
America's "Money Machine" Reviewing Ellen Brown's "Web of Debt:" Part II by Stephen Lendman | |||||
 | . | ||||
Global Research, May 9, 2009 | |||||
| |||||
This Ellen Brown developed heris the second of several articles on Ellen Brown's remarkable book titled "Web of Debt....the shocking truth about our money system, (how it) trapped us in debt, and how we can break free." It's a multi-part snapshot. Reading the entire book is strongly recommended - easily obtainable through Amazon or Brown's www.webofdebt.com site. TO ORDER ELLEN BROWN'S BOOK
www.webofdebt.com and www.ellenbrown.com . Bankers Capture the Money Machine - Fighting for the Family Farm In the 1890s, "keeping the family homestead was a key political issue" given that foreclosures and evictions "were occurring in record numbers," much like today. The "Bankers Manifesto of 1892" spelled it out - a willful plan "to disenfranchise farmers and laborers of their homes and property," again like today except that now our very freedom and futures are at stake as sinister forces aim to steal them by turning America into Guatemala and lock it down by police state repression. The panic of 1893 caused an earlier depression - severe enough to establish a precedent of street protests, the result of the first ever march on Washington. Businessman/populist Jacob Coxey led his "Coxey's Army (of around 500) from Massilon, Ohio (beginning March 25, Easter Sunday) to the nation's capital to demand jobs and a return to debt and interest-free Greenbacks. Local police intervened. The marchers were disbanded. Coxey was arrested. He spent 20 days in jail for disturbing the peace and violating a local ordinance against walking on the grass. However, he was never charged, then released, and is now remembered for his heroics. He began a tradition later sparking suffragist marches; unemployed WW I veterans for their "Bonus Bill" money; numerous anti-war and earlier civil rights protests; in 2004, one million in the nation's capital for women's rights, and the previous day thousands protesting IMF-World Bank policies. The late 19th century Populist movement was the last serious challenge to private bankers' monopoly power over the nation's money. Journalist William Hope Harvey wrote a popular book titled "Coin's Financial School" that explained the problem in simple English - that restricting silver coinage was a conspiracy to enrich "London-controlled Eastern financiers at the expense of farmers and debtors." He called England "a money power that can dictate the money of the world, and thereby create world misery." He referred to the "Crime of 73" that limited free silver coinage and replaced it with British gold. It forced America to pay England $200 million annually in gold in interest on its bonds and inspired William Jennings Bryan's "Cross of Gold" speech. He nearly became president, but lost in a close (big-monied financed) race to William McKinley, but he, too, paid a price. He was later assassinated, likely for his protectionism, very much disadvantaging British bankers. With him gone, the Morgans and Rockefellers dominated US banking, and arranged for friendly leaders to run the country, Teddy Roosevelt included, a man with more bark than bite. "The trusts and cartels remained the puppeteers with real power, pulling the strings of puppet politicians" who were bought and paid for like today. The Secret Government Various presidents suggested the worst of what's now clear. By signing the Federal Reserve Act, Woodrow Wilson was a tool of big money. Yet he belatedly expressed regret, said "I have unwittingly ruined my country," and called America "one of the worst ruled....most completely controlled governments in the civilized world (run by) a small group of dominant men." Franklin Roosevelt was as clear in saying "The real truth (is that) a financial element in the large centers has owned the government since the days of Andrew Jackson." Other officials said the same thing, and so did Matthew Josephson (in his 1934 book) calling bankers and business titans "Robber Barons" - men who "lived for market conquest, and plotted takeovers like military strategy." They sought monopolies for market dominance and trusts - concentrated wealth in a few hands to be manipulated for maximum profits and power. During the Gilded Age, trusts became strong enough to plant "their own agents in the federal commissions, (use) government regulation (for) greater control....protect themselves from competition," and keep prices high. Four names (among others) stand out - Andrew Carnegie, John D. Rockefeller, Henry Ford, and JP Morgan running finance with the power of a potentate. "He didn't build, he bought. He took over other people's businesses, and he hated competition" so he eliminated it. Together with Rockefeller, they dominated business and finance through interlocking directorates, the same way as today throughout industry, commerce and finance. For his part, Morgan was so dominant, financial writer John Moody called him "the greatest financial power in the history of the world" even before the establishment of the Federal Reserve. Morgan died months before its creation, but his influence made it possible. His long arm favored the fortunate - with enough funding to monopolize their industries. "But where did (he and other bankers get their money)?" Congressman Wright Patman explained that they created it "out of an empty hat." They held the ultimate credit card, limitless accounting-entries to buy out competitors, corner raw materials markets, control politicians, and after the birth of public relations, popular opinion the way distinguished author/psychogist and activist Alex Carey explained in his seminal book titled "Taking the Risk out of Democracy:" "The 20th century has been characterized by three developments of great political importance: The growth of democracy, the growth of corporate power, and the growth of propaganda as a means of protecting corporate power against democracy." It came into its own during WW I, then grew, became dominant, and remains near-omnipotent today, even with fissures appearing with enough promise to challenge it. The Jekyll Island Affair - Establishing the Federal Reserve In 1910, seven financial titans met secretly on this privately-owned island off the coast of Georgia and created the Federal Reserve: -- established three years later on December 23, in the middle of the night, by an act of Congress; -- its most outrageous action ever that few legislators, if any, even read or would have understood if they did because the text was so intentionally vague; -- it enfranchised powerful bankers to hold the nation hostage in permanent debt bondage by giving them the right to create money, in violation of Article I, Section 8 of the Constitution that states Congress alone has the power "To coin (create) money (and) regulate the value thereof...." Woodrow Wilson made it possible, "Morgan's man in the White House" with an administration staffed with his cronies. This act was so publicly harmful it had to be shepherded through a carefully arranged Conference Committee, scheduled for between 1:30 - 4:30AM three days before Christmas when many lawmakers had left town and many others were asleep. It was then enacted the next day - one that will live in infamy for the damage it caused. "The bill was so obscurely worded that no one really understood its provisions." The nation's money would be printed by the US Bureau of Engraving and Printing, then issued as a government obligation (or debt) to the private Federal Reserve with interest. Nominally, Congress and the president appoint Fed governors, but they operate secretly with no government oversight or control. As a privately owned banking cartel, they're a power unto themselves. The chairman sits at its helm, but he's a mere tool of the bankers who control him. The 1913 Federal Reserve Act "was a major coup" for them. The Fed exists to serve them, not the government or public interest. Therein lies its problem and why it must be abolished. For over a century, powerful international bankers wanted a private central bank giving them "the exclusive right to 'monetize' the government's debt (that is, print their own money and exchange it for government securities or IOUs.)" The entire Act was written in obscure Fedspeak so no one but its creators knew its purpose. "In plain English, the Federal Reserve Act authorized a private central bank to create money out of nothing, lend it to the government at interest, and control the national money supply, expanding or contracting it at will." Nothing has been the same since. Who Owns the Federal Reserve? Contrary to common belief, it's a private banking cartel owned by its member banks in each of its 12 Fed districts. "The amount of Federal Reserve stock" each one holds "is proportional to its size." The New York Fed is most dominant (like a mother bank) owning 53% of the System's shares because the nation's largest commercial banks are located there, on Wall Street, of course, with names like JP Morgan Chase, Citigroup, Goldman Sachs, and Morgan Stanley prominent and familiar. Bank of America was founded in California and remains concentrated heavily in Western and Southwestern states, yet operates globally like the others. The largest banks are financial superpowers with interests in commercial and investment banking, insurance, real estate, home mortgages, credit cards, and virtually all things financial - nationally and globally. Financial commentator Hans Schicht refers to Wall Street's "master spider" controlling a powerful inner circle of men, headed by him. Their business is done secretly behind closed doors by what he calls "spider webbing." It exercises "tight personal management and control, with a minimum of insiders and front-men who themselves have only partial knowledge of the game. They also have "leverage" over mergers, takeovers, chain store holdings where one company holds shares of others, conditions annexed to loans, and so forth. Further, they make concentrated wealth "invisible. The master spider studiously avoids close scrutiny by maintaining anonymity, taking a back seat, and appearing to be a philanthropist." Post-WW II, the center of power shifted from the House of Rothschild to Wall Street with David Rockefeller Sr. (John D's grandson) becoming "master spider," a sort of boss of bosses, much like the underworld but much more deadly and powerful. All the more so because "the Robber Barons (used) their monopoly over money to buy up the major media, educational institutions," and other means of communications. They got all this but Morgan wanted more - to "secure the banks' loans to the government with a reliable source of taxes, (gotten directly from) the incomes of the people. There was just one snag." The Supreme Court "consistently" declared federal income taxes unconstitutional. So how were they instituted and why are they willingly paid? The Federal Income Tax The Constitution omits any mention of a federal income tax because the Founders "considered the taxation of private income, the ultimate source of productivity, to be economic folly." They also decided that the States and federal government shouldn't impose the same tax at the same time. Congress was to have responsibility "for collecting national taxes from the States' " tax revenues. Direct taxes were to be apportioned according to each State's population. "Income taxes were considered unapportioned direct taxes in violation of this provision of the Constitution." Except in times of war, no federal income tax existed until the 16th Amendment was ratified on February 13, 1913 empowering Congress to levy one - unapportioned among the states. Even without one, the economy grew impressively for nearly a century and a half, adequately funded by customs and excise taxes. For a brief period, Congress enacted an income tax in 1894 when the nation was at peace. On April 8, 1895, in Pollock v. Farmers' Loan and Trust Company, the Supreme Court held that unapportioned income taxes were unconstitutional. "That ruling has never been overturned." To get around it, Wall Street packaged the 16th Amendment with the Federal Reserve Act, both in 1913. It applied only to annual incomes over $4000, well above the average level at the time. The original tax code was simple enough to be covered in 14 pages. It's now a 17,000 page monster, filled with obscure provisions professionals struggle to understand or even know about. It also has "whole pages devoted to private interests," including loopholes exempting powerful corporations from paying rightfully owed taxes. Before WW II, income taxes affected few people. However, from 1939 - 1944, Congress passed various ones, including to fund the war effort, and began letting workers (voluntarily) pay them in installments. Thereafter, "withholding" became mandatory. "Today the federal income tax has acquired the standing of a legitimate tax enforceable by law, despite longstanding (Supreme Court rulings) strictly limiting its constitutional scope." Numerous other taxes were also added, including on capital gains, real estate, corporate income, FICA, sales, luxury, and IRS interest and penalties. With all hidden ones included (dozens in all), up to 40% of an average worker's income goes for taxes. Enough for some tax protesters to challenge the 16th Amendment's legitimacy on grounds that it was improperly ratified. However, US courts rejected the argument and now it's "beyond review" - even though no tax would be needed if the federal government printed its own money interest-free instead of taking ours to defray banker-imposed charges. After signing the Federal Reserve Act, Woodrow Wilson called himself "a most unhappy man. I have unwittingly ruined my country." Yet he knew precisely what he did. He was a lawyer, a Ph. D, a historian and political scientist, and former Princeton University president before entering politics. Reaping the Whirlwind - The Great Depression In theory, the Federal Reserve was established to stabilize the economy, smooth out the business cycle, manage a healthy, sustainable growth rate, and maintain stable prices. It failed dismally on all counts - most noticeably in the 1930s after a depression followed the crash. The Fed wasn't the solution. It was the problem. As in recent years, it kept interest rates low and money plentiful - not money, in fact, but "credit" or "debt," the same problem creating havoc today. In the 1920s, production rose faster than wages, but (again like today) people could borrow on credit. Then as stocks soared in "value," Wall Street promoted buying them on margin (namely, leverage on credit) on the premise that higher prices could repay loans. It turned "investing" into a "speculative pyramid scheme" based on money that didn't exist. The Fed caused the whole scheme with easy and plentiful money (credit). It assured the inevitable crash, and late in the game Fed officials saw it coming. New York Fed governor, Benjamin Strong, warned wealthy industrialists, politicians, and high foreign officials to sell stocks, then began reducing the money supply and raising bank-loan rates to correct the bubble "naturally." It caused a huge liquidity squeeze. Stock purchases declined. Prices fell. Margins were called causing the crash over three days - so-called Black Thursday (on October 24), Monday and Tuesday. The subsequent fallout was disastrous. From 1929 - 1933, "the money stock fell by a third, and a third of the nation's banks closed their doors....It was dramatic evidence of the dangers of delegating the power to control the money supply to a single autocratic head of an autonomous agency." It resulted in a "vicious cyclone of debt....dragging all in its path into hunger, poverty and despair" - the very process repeating today, including insiders being tipped off, selling high, profiting from the collapse at fire sale prices, and letting the public pay for the dirty scheme they had in mind in the first place. Then, like today - shifting huge wealth amounts from "the Great American Middle Class to Big Money." Instead of shutting the Fed and prosecuting its conspirators, Congress enacted the Federal Deposit Insurance Corporation (FDIC), "ostensibly to prevent" another collapse. It insured deposits up to $5000 at the time and rescued some banks, but not all. It was for "rich and powerful" ones, the equivalent of prominent names today and considered then like now, "too big to fail" run by officials too important to offend. Milton Friedman blamed the Great Depression on the contraction of the money supply, but others disagreed. Chairman Louis McFadden of the House Banking and Currency Committee said it "was not accidental. It was a carefully contrived occurrence....The international bankers sought to bring about a condition of despair here so that they might emerge as rulers of us all." The "Bankers Manifesto of 1934" suggested the same thing, and some observers today believe it's again playing out, this time on a global scale for much greater stakes for both winners and losers. Roosevelt, Keynes and the New Deal Roosevelt addressed the collapse straightaway, starting impressively in his first 100 days with the passage of 15 landmark acts, covering: -- emergency banking; -- Glass-Steagall and the FDIC; -- empowering the Reconstruction Finance Corporation that was toothless under Hoover; -- the Securities Act of 1933, then the Securities Exchange Act of 1934; -- the Home Owners' Loan Corporation to refinance homes and prevent foreclosures; and -- an alphabet soup of development agencies in charge of constructing national infrastructure and producing jobs for the unemployed. In all, it was a whirlwind of achievement in a few short months unlike anything before or since - so much in such a short time. This writer's late April article said: Despite its flaws and failures, FDR's New Deal was remarkable in what it accomplished. It helped people, put millions back to work, reinvigorated the national spirit, built or renovated 700,000 miles of roads, 7800 bridges, 45,000 schools, 2500 hospitals, 13,000 parks and playgrounds, 1000 airfields, and various other infrastructure, including much of Chicago's lakefront where this writer lives. It cut unemployment from 25% in May 1933 to 11% in 1937, then it spiked before early war production revived economic growth and headed it lower. Challenging Classical Economic Theory - Keynesianism Post-WW II, it dominated economic policy, the idea being that deficit spending could propel nations to prosperity unlike the classical economic belief that money supply increases weren't needed. Its theory was that when the supply contracts, so do prices and wages naturally leaving everything in balance like before. It didn't work at a time people wanted jobs, but there were few around. Factories could produce, but there was little demand, and resources were available but unused - for the lack of enough pump priming to reinvigorate a collapsed economy. Enough, but not too much because as long as bankers print money, added liquidity means more debt and a greater amount to service. In addition, doing it crowds out social services, sacrifices industrial growth, and increases inflation hugely over time. The 5 cent ice cream cone and candy bars this writer remembers as a boy today cost around $2.50. If government printed its own money, they might still be a nickel or pretty close. Congressman Wright Patman suggested it in 1933 by asking: "Why is it necessary to have Government ownership and operation of banks? The Constitution of the United States says that Congress shall coin money and regulate its value," not hand it over to predatory private bankers. Instead of returning money-creation power to the government, Roosevelt let "moneychangers" keep it under an overhauled Federal Reserve - a still powerful private banker-controlled "citadel, run from the top down (by) a small cartel of appointed banking representatives (operating) behind a curtain of secrecy," more powerful than government itself. Had Roosevelt acted like Jackson and Lincoln, it would have been his greatest achievement. Even so, in his first few months in office, he got enacted tough reformist legislation, very much impacting bankers. He also "took aim at the trusts and monopolies that had returned in force" in the anything-goes 1920s. By 1929, consolidation left around 200 companies "in control of over half of all American industry." FDR reversed the trend with new legislation, reviving earlier trust-busting efforts. He also imposed banking regulations as cited above - enough to get him to call financiers "unanimous in their hatred of me, and I welcome their hatred." Lucky for him he survived. Big money plays for keeps, wins more often than it loses, and generally on what matters most. Wright Patman Exposes the Money Machine A Texas Democrat, he served in Congress from 1929 - 1976 where from 1963 - 1975 he headed the House Banking and Currency Committee until his death. Unlike his counterparts today in the House and Senate, he was called an "economic Populist," one way being for how he exposed Fedspeak to reveal the scheme behind it. In an August 5, 1964 Committee document titled "A Primer on Money," he concluded: "The Federal Reserve is a total moneymaking machine. It can issue money or checks. And it never has a problem of making its checks good because it can obtain the $5 and $10 bills necessary to cover (them) simply by asking the Treasury Department's Bureau of Engraving to print them." Although the Fed now returns most interest on its government bonds to the Treasury, of far greater importance is the windfall its member banks get. "The bonds that have been acquired essentially for free become the basis of the Fed's 'reserves" - the phantom money that is advanced many times over by commercial banks in the form of loans." Virtually all money in circulation comes from the Fed and its member banks, expanded by a factor of about 10 (through fractional reserve lending) for every federal debt dollar monitized. It all "consists of loans on which the banks have been paid interest." This interest, not what the Fed gets, "is the real windfall to the banks. The limitless money-creation machine is kept hidden "in obscure Fedspeak," even undecipherable to people who think they understand the process. In The Creature from Jekyll Island, Ed Griffin states that: "modern money is a grand illusion conjured by the magicians of finance and politics. (The Fed's function) is to turn debt into money. It's just that simple....if one remembers that the process is not intended to be logical but to confuse and deceive." It has to be. Would the public ever put up with it if they realized they'd be had - that their tax money was being used to enrich bankers, and Washington made it possible. "Magical(ly) multiplying reserves is called fractional reserve banking" that seems more like a con or "shell game." Each dollar deposited "magically" becomes about 10 in the form of loans or computer-generated funds. As explained below, "reserves" are being phased out so the 10 - 1 multiple is actually higher but the principle is the same. So if $1 million deposited becomes $10 million, and $900,000 can be loaned out (the other $100,000 required for reserves), "money created out of thin air (at 5% interest) is doubled in about two years." The Fed claims it returns 95% of its profits to the Treasury. In fact, it's only the interest on federal securities held as reserves. Far more important is the windfall afforded banks, the Fed's owners, that "use the securities as the 'reserves' that get multiplied many times over in the form of loans" that generate huge profits for them. Wright Patman wanted to abolish the Open Market Committee and nationalize the Fed, thus giving Congress control of it as a "truly federal agency" issuing interest-free money. The Fed is now heading for a zero percent reserve requirement meaning they'll be "no limit to the number of times deposits can be relent." There's effectively no limit now as if banks exhaust their reserves, they can borrow freely from the Fed - today at zero percent interest. Inside the Fed's Playbook "Banks don't have to have the money they lend before they make loans, because the Fed will 'provide' the necessary reserves by making them available at the federal funds rate" - today amounting to limitless free money at zero percent interest to be loaned out at higher rates for profit. The "slight of hand" is that the Fed "creates reserves out of thin air." Loans then become deposits that banks can freely re-lend many times over - the more deposits, the greater the amount of lending. It's a process of multiplying the money supply and charging interest for doing it, a very profitable business when working well in a healthy economy. So, the process works as follows: -- banks "lend money (they) don't have;" -- loans become deposits on their books; -- when borrowers spend their money, banks raise their reserves back to the required 10% (or less) "by borrowing from the Fed or other sources;" and -- the Fed never runs out of reserves because its "open market operations" create more of them; it simply manufactures whatever amounts it wishes out of thin air, and the public is none the wiser or that they're being taxed to pay for this shell game. Reserves don't comprise safe money to pay claimants. They're accounting entries at Federal Reserve banks letting commercial banks "make many times those sums in loans." In plain English, "reserve accounts are a smoke and mirrors accounting trick concealing the fact that banks create the money they lend out of thin air, borrowing any 'reserves' they need from the Fed, which also creates the money out of thin air." What a business, especially given how secretive it is under the protection and auspices of the federal government that sanctions the con. There's more as well. Besides what they loan out, banks "create their own investment money" to use for their own purposes. Traditionally, commercial banks invested conservatively, but not investment banks. They raise money for their clients through stock issuances and sales. But more important is their "proprietary trading" that involves using their own money to buy or sell stocks, bonds, currencies, commodities, or any other financial instrument or derivative thereof no matter how risky. Since investment and commercial banks may be one in the same, limitless sums are available through magical money creation and open-ended Fed borrowing, then leveraged multiple times through more borrowing. The game worked "magically" until it no longer did the old way, so alternatives are used. Bear Raids and Short Sales The 1929 "Crash" happened on three "Black" days but "continued for nearly four years, stoked by speculators who made huge profits not only on the market's" ascent but during its plunge to 11% of its peak value. Called a "bear raid," it targets vulnerable stocks for "take-down" quick profits or corporate takeovers at fire sale prices. When done on a large scale, short selling can impact markets greatly on the downside just like heavy "program buying" can rocket it up. The whole business amounts to blatant manipulation for quick profits. Short sellers actually do it with borrowed (not owned) stock, then sell it into the market. If it declines (it may also rise, of course), it's re-bought at the lower price, returned to the seller, with short-sellers pocketing the difference as profit. It's not investing. It's gambling with someone else's stock, without permission to borrow it, and as a result harms its owner by driving down the price when it works. "Short selling is sometimes justified as being necessary to keep a brake on (over-exuberance) that might otherwise drive popular stocks into dangerous 'bubbles.' (However,) Any alleged advantages to a company from the liquidity afforded by short selling (and supposedly keeping markets honest) are offset by the serious harm (this causes) companies targeted for take-down(s) in bear raids." When done with enough force, it can destroy companies if that's the intent. "Short selling is the modern version of the counterfeiting (that brought) down the Continental in the 1770s." Currencies, bonds, and commodities can be shorted just like stocks - to manipulate them for profit. Worse still, and illegal, is so-called naked short-selling without first borrowing the security shorted, assuring it can be borrowed, or arranging to borrow it as required by law - the reason being that it's an even easier way to manipulate stock prices so SEC regulations ban it. Even so, the idea that markets move randomly is rubbish. So is believing that companies or nations don't target competitors for destruction by attacking their worth through short selling or other manipulative ways. Hedge funds and Derivatives "Hedge funds are private funds that pool the assets of wealthy investors with the aim of making 'absolute returns' - making a profit whether (markets go) up or down" on whatever financial assets they invest in. Leverage is used for maximum profitability, the more of it the greater gain or loss. In futures trading, it's called the margin - placing "many more bets than if they had paid the full price." Originally, hedge funds were to "hedge (investment) bets....against currency or interest rate fluctuations (but) they quickly became instruments for manipulation and control." At their peak, they controlled over half of daily equity market trading because of their numbers, size, amount of capital, and frequency of their buying or selling. Derivatives are one of their key tools - essentially making "side bets that some underlying investment will go up or down" to insure against the risk. "All derivatives are variations on futures trading (and like it) is inherently speculation or gambling." Familiar examples include puts and calls - on whether assets will go down or up. "Over 90% of the derivatives held by banks....are 'over-the-counter' (ones) specially tailored to financial institutions (with) exotic and complex features, not traded on standard exchanges." They're unregulated, hard to trace, and "very hard to understand," quite often impossible. In a 1998 interview, banking columnist John Hoefle called them "the last gasp of a financial bubble." More recently Warren Buffett said they were "financial weapons of mass destruction" even though he owns a sizable amount of them and incurred considerable losses as a result. Derivatives aren't assets. They're "just bets" on how assets will perform using very little real money. Most is borrowed to make private unreported, unregulated bets that have soared to a "notional value" of around $370 trillion, according to the Bank for International Settlements as of 2006. Notional value is "the number of units of an asset underlying the contract, multiplied by the spot price of the asset." In other words, "fanciful, dubious or imaginary" assets. The amount gets so large because when unregulated "gamblers can bet any amount of money they want," and when markets work well for them, the sky's the limit. In mid-2006, the Office of the Controller of the Currency reported that around 97% of US bank-held derivatives were owned by five major US banks, including JP Morgan Chase and Citigroup. In November 2005, Bloomberg reported that the credit derivatives market was "vulnerable to a crisis if one (of their major bank holders) fails to pay on contracts that insure creditors from companies defaulting...." John Hoefle warned we were "on the verge of the biggest financial blowout in centuries, bigger than the Great Depression...." Since banks can create money out of thin air, how can they go bankrupt? Because under accounting rules, commercial banks have to balance their books so their assets equal liabilities. "They can create all the money they can find borrowers for, but" if loans default, banks must record a loss. Just imagine - if the government created money and not banks, economic stability would follow, crises could be avoided or greatly lessened, inflation would be minimal or non-existant, prosperous growth would be long-term, and bank loans would be far less risky than today assuring steady profits but in smaller amounts. A follow-up article will discuss global debt entrapment. Stephen Lendman is a Research Associate of the Centre for Research on Globalization. He lives in Chicago and can be reached at lendmanstephen@sbcglobal.net. Also visit his blog site at sjlendman.blogspot.com and listen to The Global Research News Hour on RepublicBroadcasting.org Monday - Friday at 10AM US Central time for cutting-edge discussions with distinguished guests on world and national issues. All programs are archived for easy listening. http://www.globalresearch.ca/index.php?context=va&aid=13461 research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Her earlier books focused on the pharmaceutical cartel that gets its power from “the money trust.” Her eleven books include Forbidden Medicine, Nature’s Pharmacy (co-authored with Dr. Lynne Walker), and The Key to Ultimate Health (co-authored with Dr. Richard Hansen). TO ORDER ELLEN BROWN'S BOOK
www.webofdebt.com and www.ellenbrown.com | |||||
Stephen Lendman is a frequent contributor to Global Research. Global Research Articles by Stephen Lendman | |||||
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