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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Seeker of Truth who wrote (13754)	1/23/2007 5:03:51 PM
From: energyplay	Read Replies (1) \| Respond to of 218083

"Among European investors, of all countries the most respected place to invest besides their own countries is, believe it or not, the US." Lots of very good reasons for this. Generally, all Anglo-Saxon countries (Canada, US, UK, Australia, NZ) have better, more realistic, and more transparent accounting than the Europeans. Considerably better protection for minority investors. Look on Crossy's board for a discussion of the pending squeeze of minority investors (people like us here on SI) by a Norwegian company. Switzerland and Nederlands come close with accouting, but many other countries let corporations deliberately obscure their numbers with various 'reserves' and other things. A strong culture of shareholders / investors rights, as opposed to the state or labor having demands on enterprises, like in Germany. US Corporations tend to be run more by professionals, not family members. Family intervention, like with Ford Motor, is the exception. In Europe, Paris Hilton would be running the hotel company....;-) I expect many investors thinks that's kind of like choosing a President because his daddy was president. The US does pick leaders with a wider range of social classes and nationalities. There are lots of CEOs from middle or working class backgrounds - Steve Jobs, Larry Ellison, Andy Grove. Class is still a huge factor, but not as much as Europe. In France, it really helps if you are an ENArch, and attended the right school. The Germans who run SAP are equivalent to the Oracle team, but where's the French or German equivlent of Steve Jobs ? Any black CEOs in Europe ? Are they running anything like American Express, Merrill Lynch, or Time Warner ? I guess they won't invent the Gold Card, like Ken Chenault at American Express did. US management gets paid lots of money to deliver results - and this attracts talent from all over the world. CEOs who can't deliver get to leave. Larry Pressler of the Gap clothing store is out this week, Bill Ford at Ford got Mullay from Boeing to replace him. If you are a crook, you may eventually end up in jail, like Bernie Ebbers of World Com, Kozlozski of Tyco, Jeff Skilling of Enron (24 years in high security), and the 70+ year old John Rigas, who cooked the books at Adelphia. Austalia and the UK also jail corporate crooks. Martha Stewart did a minor infraction, equivalent to running a red lite, and gets federal prison. This builds investor confidence that the market is not 100% rigged. I don't know about the Istanbul stock market. ***************** I think the US culture cares about money and business much more than most Europeans. Sort of the way the French and Italians care about food.

To: Seeker of Truth who wrote (13754)	1/25/2007 9:10:26 PM
From: elmatador	Respond to of 218083

Brazil's economy: Stirred, but not shaken up. long-awaited package to boost economic growth is overly timid Jan 25th 2007 \| SÃO PAULO From The Economist print edition A BIT more public investment, a dash of tax relief and a promise to contain the growth of current spending: those are the main ingredients of a ballyhooed “growth-acceleration package”, which Brazil's government finally announced on January 22nd. “The time has come to break barriers and overcome limits,” declared the president, Luiz Inácio Lula da Silva, presenting a plan that he hopes will set the tone of his second four-year term in office, which began this month. In his first term, Lula opted to maintain Brazil's hard-won economic stability. The package does not jeopardise that. It is intended to address the country's mediocre economic growth (see chart). Industry paused from grumbling about crushing taxes and interest rates and the overvalued currency to praise the package. It alone will not produce sharply higher growth but “it goes in the right direction,” says Armando Monteiro, president of the National Confederation of Industry. Others say that it does not attack the cause of low growth: excessive spending and debt, which depress investment by keeping taxes and interest rates high. “The main constraints are untouched,” says Mailson da Nóbrega of Tendências, a consultancy. The package calls for investing an impressive-sounding 504 billion reais ($236 billion) in infrastructure and housing over the next four years. Taxes are to be cut by a less-impressive 6.6 billion reais this year, and 11.5 billion reais in 2008. The cuts are targeted at construction, infrastructure and small businesses. To restrain current spending, which has grown faster than the economy, the government proposes new caps for two of its main components. The minimum wage, which is also the floor for publicly financed pensions, will rise in line with inflation and the economy's growth. The government's wage bill will rise by no more than 1.5% above inflation. Officials say that these caps mean that the government payroll will fall from 5.3% of GDP to 4.7% by 2010, while pension spending would remain steady, at about 8% of GDP. On closer inspection, the package loses some of its lustre. Most of the promised investment is what state-owned companies were already planning to spend, and what the government hopes private enterprise will. Just 68 billion reais is investment by the federal government. Nearly all this year's tax cuts were already enacted; there is just 1.4 billion reais of new relief. The government cannot offer more, because it has not yet curbed spending. Lula has already decreed a 9% rise in the minimum wage for this year. The new wage caps must be approved by legislators who tried to raise their own salaries by 90% last month (but were thwarted by the supreme court). Instead of proposing a pension reform, Lula plans to summon a “forum” to discuss it. Mr da Nóbrega notes that a similar body failed to liberalise labour laws during his first term. Rather than slash current spending to make room for extra public investment, the government may cut its primary surplus (ie, before interest payments) from 4.25% of GDP, until now its main fiscal target. Public debt would continue to fall as a share of GDP, but more slowly, hindering Brazil's progress towards an investment-grade credit rating. The government now stresses the overall deficit, which is to fall from 1.9% of GDP this year to 0.2% in 2010. But that prediction rests on rosy assumptions: a robust world economy and, less likely, a near doubling of growth. The package's main virtue may be to goad the government into executing projects rather than merely talking about them. The projects are now part of a plan that the government will monitor, officials insist. They want to streamline procedures for issuing environment licences, now an obstacle to investment. Last month, the government halted plans to get private investors to maintain seven main highways. Now, apparently, it wants to revive this scheme. Investors in infrastructure will get tax breaks and cheap money from state banks. The government also wants state companies to operate on private-sector lines, to boost competition. Will the package succeed in raising growth? It may help at the margin. More important is the effect of stability. Low inflation and falling interest rates—the Central Bank cut its benchmark rate on January 24th by a quarter-point to 13%—mean that government bonds are no longer the only sane investment option. The stockmarket has seen many new share offerings. Mortgages doubled last year, but are still puny at less than 4% of GDP. Now construction companies are rushing to list on the stockmarket, capitalising on the twin manias for shares and property. Slowly, rather than through any swift barrier-breaking, Brazil may shake off its torpor.