03.08.2009

Politics & the Nation

• Private airlines call off strike
• Unable to withstand the government pressure and also because of divisions within their ranks, the private airlines called off the proposed strike on August 18.
• The backing out by SpiceJet and IndiGo airlines appeared to have broken the camel's back.
• On what's wrong with the proposed airlines' strike
• In a country where air travel is still the preserve of a privileged few, there can be no justification for using taxpayer money to bail out private airlines. Today it is airlines, tomorrow it could be automobiles or steel or two-wheelers or any other industry that feels it is now large enough to hold the country to ransom.
• How well should land acquisition be compensated?
• Some excellent thoughts on this subject from Jaideep Mishra in his today's op-ed piece. Well worth a read.

Finance & Economy

• BSNL makes profit; but...
• For the fiscal year to end-March 2009, BSNL showed a measly Rs 575 crore as profit. Even this was possible only because interest income from its cash reserves was about Rs 3,900 crore.
• IN 2007-08, its net profit was Rs 3,009 crore on interest income of Rs 4,004 crore, buttressing the case its profits in the past two years have less to do with its telecom business. Income from activities not related to its core business during this period was nearly Rs 5,700 crore. Cash reserves fell to Rs 35,337 crore at the end of March 2009 from over Rs 40,000 crore a year ago.
• BSNL chairman & managing director: Kuldeep Goyal
• NICE
• Non-inflationary consistent expansion.
• This is a phrase that was famously coined by Mervyn King, the governor of Bank of England.
• A bit of study on interest rates and government borrowing. (Excerpted from an article by Mythili Bhusnurmath)
• There is an increase in the weighted average yield for government securities — from 6.68% in the last quarter of 2008-09 to 6.93% in the first quarter of the current fiscal. This implies that government is now forced to pay a higher rate of interest than in the past to borrow.
• There is a dramatic shortening in the average maturity of government securities issued in 2009-10 from 15.2 years last year to 11.5 years, implying the market has reservations about lending to the government for longer periods.
• Indian Railways is the biggest employer globally
• It has about 1.6 mn employees on its rolls. It is reportedly the biggest civilian employer in the world.
• But it is the second larges rail network in the world.
• See what the US business interests can demand and make their demands appear as genuine!
• Bilateral investment talks between the US and India are going on. No agreement could be reached so far.
• The main contention in the bilateral investment talks was the US’ insistence on pre-investment national treatment for its investors. In such an arrangement, India will have to take responsibility for losses incurred by a US company before it actually invests here if the loss is due to a policy change.
• So, if a US company spends money on market research before it invests here, India will be responsible for making good the losses if that company is unable to invest here due to a policy change or a government decision.
• So far, India has extended only post-investment national treatment to countries with which it has investment promotion agreements. Under post-investment national treatment, once a foreign company invests in India, it will be subject to the same laws for investment protection that are applicable to domestic investors. However, it has no obligations for losses incurred by companies in the pre-investment stage.
• India has signed a number of bilateral investment promotion agreements with trading partners such as Australia, UK, France, Germany and Russia, but it has extended post-investment national treatment only to Singapore.

International

• Forgive us our indulgence in things written by experts like Bradford Delong.
• Just take a look at this article. While wondering as to why the global responses to the ongoing financial turmoil, have not involved multilateral / global institutions, he lets us onto some excellent financial history during the last 200 years.
• If you have a stomach for this, read it in full here.
• US banks go belly up in record numbers this year
• BANK failures in the US are increasing by the day, with an average of 10 entities going belly up every month, taking the toll to 69 so far this year. With five more banks collapsing in July 31, a staggering 24 entities were shut down last month, the highest for any month in 2009. Moreover, the number of failures till the end of last month at 69 is more than double that of last year’s 25.
• The FDIC (Federal Deposit Insurance Corporation) recently said the number of ‘problem banks’ in the US has risen to a 15-year high of 305 in the first quarter of 2009 against 252 in the December quarter last year.
• Beige Book: It provides a snapshot of the economic situation in various districts in the US.

Science & Technology

• Revolt by killer robots worry scientists
• As advances in artificial intelligence bring the scifi fantasy dangerously closer to reality, worried scientists have painted a nightmare scenario of a revolt by killer robots, a situation until now limited to science fiction films. Leading researchers have warned that they may be creating ultrasmart machines which could end up outsmarting and perhaps even endangering humans. At a secret meeting to discuss limiting their research, top scientists cautioned that computer-based systems that carry out a growing share of society’s workload, from waging war to chatting on the phone, have already reached a level of indestructibility.

Health

• WHO levels in describing a pandemic
• LEVEL A (Potential pandemic)
• LEVEL B (No community-level outbreaks yet)
• LEVEL C (Verified human-to-human transmission of an animal or human-animal influenza reassortant virus)
• LEVEL D (Human-to-human spread of virus into at least two countries in one WHO region)
• LEVEL E (The pandemic phase)

Language lessons

• cachet: Noun
• An indication of approved or superior status; A warrant formerly issued by a French king who could warrant imprisonment or death in a signed letter under his seal; A seal on a letter
• eg: The cachet of an English public school education is apparently well worth its weight in bullion.