The extractive industries are one of the biggest sources of foreign direct investment for many emerging economies - often accounting for over half of total government revenues - but frequently the money does not end up in the right hands.
The broad hint given by Jean-Claude Trichet, President of the European Central Bank, during the ECB’s monthly press conference on March 3, that the Bank was actively considering a rate hike in the short term, has prompted astonishment from fund managers and economists. There is no doubt that the ECB’s comments will also be very unhelpful to the Governor of the Bank of England, Mervyn King, who is trying to contain the hawks on the Monetary Policy Committee who are also pushing for a UK rate rise to contain inflation, currently nudging 5%.
With the damage caused by the fifth largest earthquake ever recorded (magnitude 9.0) still being assessed, the expectation is that the impact on Japan’s economy will follow a similar path to that seen after the somewhat smaller (magnitude 7.2), but still devastating Kobe earthquake of 1995. The human loss, however, will be far in excess of that experienced at Kobe. Initial estimates put the likely death toll at in excess of 10,000. It would be surprising, given the scale of the devastation, if that figure is not revised upwards in the days to come.
Bringing to you the top finance and business news stories of the week. This week, oil prices rise sharply due to unrest in Libya, Barclays bonuses are frowned upon, and a devastating earthquake and tsunami in Japan rock the markets.
Murphy’s Law says that if something can go wrong, it will go wrong. For the last year it seems that Murphy’s Law has been in full swing in the world’s commodities markets. From droughts to floods, the weather has, to say the least, not been kind to those who rely on the soil. In past decades this might not have mattered as intensely as it does today, but with developing economies demanding more rather than less by way of grains and meat, the pressure on soft commodities has been unrelenting and the least shortage quickly feeds through into price hikes.
This is the second part of Ian Fraser's blog on Warren Buffett’s letter to shareholders in insurance conglomerate Berkshire Hathaway. Here, Fraser examines the Omaha-based investor’s thoughts on derivatives pricing, his views on academic economists, leverage, and hedge funds.
This is the first part of Ian Fraser's blog on Warren Buffett’s letter to shareholders in insurance conglomerate Berkshire Hathaway. Warren Buffet's annual letter to shareholders in his Berkshire Hathaway Inc insurance-based conglomerate is eagerly awaited - largely because it tends to contain some useful pearls of management thinking.
With the threat of the growing build up of unsustainable concentrations of greenhouse gasses ever before them, the world’s governments in both developed and developing nations, are looking increasingly to the electrification of transport as a way of rolling back CO2 emissions. This is the official “Plan B” scheduled to replace our current “Plan A” (briefly defined as 'use fossil fuels until rising costs kill the idea').
It’s virtually unheard for the governor of a central bank to launch an outspoken attack on the integrity and purpose of his country’s banking sector. But this is what the Bank of England governor Mervyn King did last weekend.
Infrastructure has long been one of the more esoteric “alternative” investments, broadly defined as a separate asset class yet loosely grouped with both other kinds of non-market-correlated investments and one another. Indeed, save for a few large and sophisticated pension plans, few have been able to differentiate among the numerous and varying kinds of infrastructure opportunities out there, instead lumping them all into one category (much in the same way many institutions lump hedge funds in “absolute returns”).