Sox First

• One in four American children on food stamps

  The deep divide in American society becomes wider. Wall Street is booming but, as the New York Times tells us, one in eight Americans and one in four children are now on food stamps. The NYT reports: "More than 36 million people use inconspicuous plastic cards for staples like milk," [...]
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  Posted: November 30, 2009, 2:39am EST
  

• Dubai: a sign of worse to come

  Dubai media and business leaders are moving to reassure the world about the Dubai World mess, claiming the fears are overblown and exaggerated with papers like the English-daily Khaleej Times saying the decision to restructure Dubai World shows "maturity".Having worked in Dubai, I can tell you now that the place [...]
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  Posted: November 30, 2009, 2:05am EST
  

• Berlusconi fights on

  Italian Prime Minister Silvio Berlusconi will be on trial this week on charges of paying a $600,000 bribe to David Mills, his former British tax adviser. That's after they overturned the law that he had pushed through Parliament last year, giving himself immunity from prosecution. But he's not giving up. [...]
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  Posted: November 28, 2009, 11:51pm EST
  

• Dubai: what's ahead?

  The Economist has a good take on how Dubai's creditors were taken in and fooled. The Economist writes: "Dubai’s debts are heavy, amounting to about $80 billion including the government and the conglomerates it controls. Investors had half-expected Dubai World to seek forbearance from its bankers, asking them to extend'" [...]
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  Posted: November 28, 2009, 10:18pm EST
  

• The shrinking movie release window and blockbusters

  The movie world is a fascinating industry to watch. It's developing and changing all the time, in unexpected ways.Cable and satellite television are now supplying more channels to more people across the world with more than half of all pay-television subscribers now live in the Asia-Pacific region. And every minute,' [...]
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  Posted: November 28, 2009, 2:34am EST
  

• Artists and capitalism

  For the most part, you wouldn't think that artists would have much to like about capitalism. But a new paper, Art and Money suggests that artists can make big bucks out of capitalism.The researchers, William N. Goetzmann from Yale School of Management, Luc Renneboog and Christophe Spaenjers, both from Tilburg' [...]
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  Posted: November 28, 2009, 2:01am EST
  

• Bankruptcies soar with no recovery in sight

  President Obama might be vowing a US recovery in his Thanksgiving address but don't expect it too soon. Probably not this term if the latest set of economic stats are anything to go by.Figures released by the US courts showing that bankruptcies are up 34.5% to 1,402,816 over a space' [...]
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  Posted: November 27, 2009, 3:09am EST
  

• The Dubai con job

  What do Brad Pitt, Angelina Jolie, Naomi Campbell, David Beckham and Denzel Washington all have in common. According to FT Alphaville, they all invested in get rich quick schemes in Dubai. So did banks like HSBC ($17 billion), Standard Chartered ($7.8billion), Barclays ($3.6 billion), Citi ($1.9 billion) and BNP Paribas [...]
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  Posted: November 27, 2009, 2:36am EST
  

• Is Rupert Murdoch trying to scare Google?

  It's been fascinating to read how Rupert Murdoch, sick of Google "stealing" his content, has joined forced forces with Microsoft's Bing in a deal that would see Microsoft agreeing to pay Murdoch for exclusive rights to list his content, something that Google will not do.But is there another agenda at [...]
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  Posted: November 26, 2009, 1:13am EST
  

• Dubai goes for broke

  Back last month, I did a blog entry looking at how Dubai was struggling to pay its debts.Now, it looks like the once opulent kingdom of Dubai could go the way of Iceland and go broke. Now, this week we had reports of Estonia's economy losing 15.3%, and The Wall [...]
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  Posted: November 26, 2009, 12:55am EST
  

• Unemployment among blacks at Depression levels

  This Washington Post story shows how centuries of racial discrimination still shapes the lives of Americans with unemployment for 16-to-24-year-old black men reaching Great Depression proportions. It was at 34.5% in October which is three and a half times the rate for the general US population.Not all of it is [...]
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  Posted: November 25, 2009, 3:14am EST
  

• Sarbox Lite or the end of Sarbanes-Oxley?

  At the beginning of this month, I looked at how Obama had dismantled the post-Enron reforms. Significantly, a Democratic-controlled House pushed through changes that in effect neutralize Sarbanes-Oxley, the legislation that had been put there to protect investors. Sarbanes-Oxley had passed, almost unanimously, by a Republican controlled House. New York [...]
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  Posted: November 25, 2009, 2:51am EST
  

• Climategate was no conspiracy

  Scientists have always been a weird bunch but the fallout over climategate email hacking incident has been nothing short of extraordinary. Now, we have Republican senator James Inhofe calling for an investigation into the United Nations-sponsored Intergovernmental Panel on Climate Change. The fallout from this is not coincidental in the [...]
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  Posted: November 24, 2009, 5:03am EST
  

• Will Dimon replace Geithner?

  The whispers are getting louder with the New York Post reporting that JP Morgan Chase CEO Jamie Dimon is emerging as the replacement for beleaguered Treasury Secretary Tim Geithner. According to the Post, sources say policy makers are canvassing Dimon as a successor to Geithner whose reputation has taken a [...]
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  Posted: November 24, 2009, 4:08am EST
  

• Bad economy, suicides and compensation

  Earlier this month, I looked at preliminary reports showing there has been an uptick in the number of suicides with the recession. Now there is further confirmation with a report from The Wall Street Journal showing that 19 of the largest states reporting a 2.3% increase in suicides. In Florida, [...]
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  Posted: November 23, 2009, 4:56am EST
  

• US to pay $500 billion to service mega debt

  Earlier this month, I did a blog entry warning of worse times ahead with the US debt hitting $12 trillion. Just how bad is it going to get? As the New York Times warns, the US is now facing waves of debt payments. Servicing that debt will exceed $700 billion [...]
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  Posted: November 23, 2009, 1:50am EST
  

• Detroit struggles to bury its dead

  While Michigan's unemployment is at 15.1%, Detroit's rate is at close to 28%, thanks to years of mismanagement by Ford, Chrysler and GM. Things are so bad in Detroit now that they can't even bury their dead. As The Times reports, the bodies have been piling up in the morgue' [...]
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  Posted: November 21, 2009, 11:07pm EST
  

• The war industry's victory: more tax to pay for Afghanistan

  More evidence of the military's growing clout with reports here and here that Us lawmakers are proposing higher taxes to pay for sending more troops to Afghanistan.Carl Levin, chairman of the Senate Armed Services Committee has proposed an "additional income tax to the upper brackets, folks earning more than $200,000'" [...]
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  Posted: November 21, 2009, 4:36pm EST
  

• KaosPilot revolution

  Earlier this year, I looked at the way business schools had contributed to the recession by producing the financial engineers, Masters of the Business Apocalypse (MBAs) who ended up destroying the markets. How refreshing then to read about the most unusual business school in the world. KaosPilots in Denmark. It's' [...]
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  Posted: November 21, 2009, 1:13am EST
  

• Hedge funds and brokers turn to poker

  Investing and poker have often been compared. But it's not surprising that financial recruiters for hedge funds and broking houses are scrutinizing professional poker to find talent and analytical tools. As Bloomberg reports, they think it's a good fit because both pursuits require a rational approach toward risk, self-control, speedy [...]
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  Posted: November 20, 2009, 5:01pm EST
  

• China with the most English speakers

  Which country will have the most English language speakers? It will be China with the Financial Times reporting that China is about to get more English-language speakers than India. Whereas an estimated 55 million speak English in India, China is increasing its English language speakers by 20 million a year.Why [...]
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  Posted: November 20, 2009, 7:28am EST
  

• One in seven US home loans at risk of foreclosures

  What chances of a US recovery? Don't hold your breath. As reported here, foreclosures will keep rising through 2010 and one in seven US home loans is now past due or in foreclosure. The quarterly delinquency measure is at its highest level since 1972.br />All up, just over 14% of' [...]
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  Posted: November 20, 2009, 3:19am EST
  

• Cyber warfare to erupt

  Banks and utilities will be on the front line when nations turn to cyber warfare, and there is evidence some of that's occurring right now, according to a new report.The report, by security vendor McAfee, says: "The critical infrastructure of nation-states—banking and finance, electrical grids, oil and gas refineries and pipelines,'" [...]
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  Posted: November 19, 2009, 3:47am EST
  

• Why it's not easy being green

  Yesterday, I did a blog entry on how policy makers were losing the battle to win public support on climate change because of what's been called Apocalypse Fatigue where people are so overloaded with warnings of terrible climate-induced disasters ahead that they just switch off. That might explain why people' [...]
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  Posted: November 19, 2009, 3:01am EST
  

• Apocalypse Fatigue: losing the battle on climate change

  Why are so many still questioning climate change when the science is becoming more definitive?Scientist put it down to Apocalypse Fatigue. "The lesson of recent years would appear to be that apocalyptic threats — when their impacts are relatively far off in the future, difficult to imagine or visualize, and" [...]
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  Posted: November 18, 2009, 4:43am EST
  

• Economy to get worse with debt hitting $12 trillion

  While the global economy continues to improve, the situation in the United States is more grim where the going is slower than expected. The US economy is facing a long hard haul back with debt levels now topping $12 trillion. That only adds to pressure on the economy from weak [...]
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  Posted: November 18, 2009, 2:59am EST
  

• Cost cuts hit auditors

  The economic crisis is having an impact on financial statements and auditors with Britain's Financial Reporting Council (FRC), as reported here, warning that accounting firms could sacrifice audit quality when they're cutting costs and scrambling to get more cash in through the door.In fairness, the FRAC didn't find any evidence' [...]
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  Posted: November 17, 2009, 6:01am EST
  

• 49 million Americans go hungry

  US stocks might be rallying to a 13 month high and retail sales have bounced on the back of resurgent car sales but look behind the numbers and you will see the US is a long way off from recovery. According to a new report from the United States Department [...]
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  Posted: November 17, 2009, 4:32am EST
  

• New fair value rule to face test

  Corporate disclosures are about to get a lot longer and a lot more complicated. The International Accounting Standards Board has released its revised set of rules dealing with the classification and measurement of financial assets, such as loans, as well as debt and equity securities using fair value. Sox First [...]
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  Posted: November 16, 2009, 5:43am EST
  

• Christianity and the crash

  Did Christianity cause the market meltdown? Probably not completely but according to Hanna Rosin at The Atlantic, it fueled the housing bubble that created the crash.In her piece, Rosin talks about a different strain of Christian faith which has has grown in popularity, one that promises to make believers rich [...]
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  Posted: November 16, 2009, 5:27am EST
  

• Greenland melting fast

  In the lead up to Copenhagen, we have alarming news that Greenland's ice sheets are melting at an accelerating rate. According to the report, Greenland lost an estimated 1500 gigatons (one gigaton is equal to 1 billion tons) of ice from the year 2000 to 2008 and if it does' [...]
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  Posted: November 15, 2009, 4:24am EST
  

• Climate change and Big Brother

  The age of Big Brother is upon thanks to climate change. Yesterday, I did a blog entry looking at how the Dutch government plans to introduce a road tax to reduce greenhouse gas emissions. Significantly, every car will be equipped with a GPS device to track the distance and how [...]
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  Posted: November 15, 2009, 3:55am EST
  

• Dutch road tax a sign of things to come

  A sign of what's ahead around the world with the Dutch government announcing that it plans to introduce a "green" road tax by the kilometre from 2012 to reduce carbon emissions by 10%. Each car will be equipped with a GPS device to track the distance and how much the' [...]
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  Posted: November 14, 2009, 1:29am EST
  

• The last tuna?

  The world is running out of tuna, the result of over fishing and illegal fishing. The International Commission for the Conservation of Atlantic Tunas (ICCAT) has been told that stocks of the giant bluefin tuna are close to collapse with catches in 2008 at three times the ICCAT limit. The [...]
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  Posted: November 14, 2009, 12:47am EST
  

• Taxpayers lose out on bank bailout

  Neil Barofsky, the special inspector general for the $700 billion Troubled Asset Relief Program (TARP), otherwise known as the bank bailout or banking welfare program, has conceded that the program will result in a loss to taxpayers to the tune of tens of billions of dollars.Barofsky said: "We need to" [...]
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  Posted: November 13, 2009, 3:13am EST
  

• Gold price rises as supply runs out

  The price of gold continues to rise, now hitting an all-time high of $1,123.38 an ounce. For good reason too. Investors now see it as an alternative to the slumping US dollar.But we can expect the gold price to just keep going up with reports that global gold production is [...]
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  Posted: November 13, 2009, 2:55am EST
  

• Glass-Steagall and the market meltdown

  It's the 10th anniversary of the repeal of the Glass-Steagall Act. That's right, 10 years ago the Clinton administration abolished the Depression era legislation. Glass-Steagall was passed under the Roosevelt administration in 1933 to stop the Wall Street shenanigans that had ushered in the Great Depression where banks getting their [...]
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  Posted: November 13, 2009, 2:20am EST
  

• US unemployment to hit 13%

  We've been hearing lots of commentators say that US unemployment will peak at around 10% and that the recession is over. But former Merrill Lynch economist David Rosenberg says unemployment will hit 13%, the highest since monthly records began in 1948. According to this report, Rosenberg says the rising unemployment' [...]
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  Posted: November 12, 2009, 4:16am EST
  

• Is China about to collapse?

  Hedge fund manager James Chanos will go down in history as the first to predict that Enron was a disaster in the making. Chanos is in the business of scrutinizing companies for their flaws and then making a fortune by betting against them.Now, he is predicting that China is about [...]
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  Posted: November 12, 2009, 3:54am EST
  

• Suicides: the real cost of recessions

  More reports confirming the way the recession is destroying, quite literally, the lives of so many people with news that the rate of suicides is on the rise as people weight up the cost of the recession with soaring unemployment and home foreclosures. According to one psychology professor quoted in [...]
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  Posted: November 11, 2009, 2:30am EST
  

• Big Tobacco extends its reach

  Big tobacco has hit upon a brilliant strategy with reports that Reynolds American Inc, maker of Camel cigarettes, is planning to buy a company that's stopping people from smoking.The manufacturer of cancer sticks is apparently in talks to buy Swedish maker of nicotine gum Niconovum AB. Now what could that' [...]
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  Posted: November 11, 2009, 1:52am EST
  

• Murdoch threatens Google and BBC

  Rupert Murdoch's charge for online content strategy continues to get stranger and stranger. Now he has told Sky News that his company's online newspaper pages will be invisible to Google users when it launches its new paid content strategy. Asked by Sky News Australia's political editor David Speers why News' [...]
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  Posted: November 10, 2009, 2:04am EST
  

• Most Americans to depend on government for handouts

  To fix the unemployment problem, economist Paul Krugman suggests the US Government bring in a WPA (Works Progress Administration) -type program, the same sort of approach that was adopted in the New Deal. The problem with that, as Zubin Jelveh, says in the New Republic is that people taking up [...]
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  Posted: November 10, 2009, 1:28am EST
  

• Al Gore, climate change profits and civil disobedience

  Plenty has been written about Al Gore making mega profits out of global warming. As the New York Times reported last week, as a partner in Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers, he has cleaned up big time with its investments in smart electricity grids. That's' [...]
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  Posted: November 09, 2009, 3:27am EST
  

• Goldman Sachs: doing

  Hard to go past this interview with Goldman Sachs boss Lloyd Blankfein in The Times where he claims bankers are doing "God's work"."We’re very important," Blankfein says. "We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have" [...]
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  Posted: November 09, 2009, 2:43am EST
  

• Goldman Sachs and God

  Hard to go past this interview with Goldman Sachs boss Lloyd Blankfein in The Times where he claims bankers are doing "God's work"."We’re very important," Blankfein says. "We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have'" [...]
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  Posted: November 09, 2009, 2:43am EST
  

• Galleon scandal: just the beginning?

  The biggest prosecution of hedge fund insider trading went into overdrive this week with 20 people, including Galleon Group LLC co-founder Raj Rajaratnam, getting hauled up on criminal charges. Bloomberg has the rogue's gallery of all the names of the people behind the insider trading. We can expect a debate' [...]
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  Posted: November 08, 2009, 4:09am EST
  

• MBA turkeys and the market

  Earlier this year, I did a blog entry slating the business schools for helping create the market meltdown. The Women on the Web site followed up with a brilliant roll call of MBAs, or Masters of the Business Apocalypse, from Harvard. The rogue's gallery includes former Merrill Lynch CEO Stanley' [...]
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  Posted: November 08, 2009, 1:22am EST
  

• Why Facebook is for old farts: the demographics of social networking

  Earlier this year, we had the shocking news that the fastest growing group of Facebook users were the 55-plus age group. In a space of just six months, they had increased a whopping 513%. Time Magazine's Lev Grossman came up with reasons why Facebook was for old farts: Facebook is' [...]
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  Posted: November 07, 2009, 12:54am EST
  

• Unemployment and the failed stimulus

  Back in January, US unemployment was sitting at 7.2% and commentators were saying a stimulus package would fix everything. It hasn't. The latest appalling figures show that US unemployment has hit 10.2%, a 26-year high. Worse still, the total unemployment figure including people who have either been forced to work' [...]
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  Posted: November 06, 2009, 4:53pm EST