hello
Its a good initiative taken by teesra banda
. Article on P2P napster was nice!
Lookin forward to more interesting articles on this thread...
Nisheeth
The legitimate music download market seems to be a two horse race between iTunes and Napster, with Apple enjoying the greater lead by far.
Just a coupla things abt itunes.....Its success being a given, Apple has recently licensed the iTunes software to Motorola for inclusion in its new 3G phones that are expected around Q2-2006....Most reports that I've read believe that this move is likely to give a *huge* boost to itunes' popularity as well as in giving a strong edge to Motorola which is bracing itself for the imminent launch of multiple clamshell models from Nokia in the US 😃 Consequently, this can also mean the death knell to Real(and its online stores) whose music players have so far dominated most mobile platforms....
Never one to miss a digital zeitgeist, Apple's Steve Jobs quickly pounced on the new appetite for digital music (and the long awaited explosion of broadband adoption) by launching the first iPod later in the same year.
I am not really sure many would acquiesce with this line of thought ;)
Cheers
ps: Nice initiative....And to everyone, plz do post the source along with a link 😃
ps: Nice initiative....And to everyone, plz do post the source along with a link :)
Finally some appreciations for my initiative have started pouring in....But appreciation or no appreciation i will keep them coming !!!:)
Cheers
WEEK's BUSINESS Headlines
KPMG agreed to pay $456m to settle an investigation by America's Justice Department into a fraudulent tax-shelter scheme offered to wealthy individuals. The "Big Four" accountancy firm will not now face criminal charges (although it has admitted wrongdoing and is on probation until the end of 2006), thus avoiding the fate that befell Arthur Andersen, which was brought to trial for its part in the Enron affair. However, eight former partners at KPMG were indicted. The shelters, which operated between 1996 and 2002 cost the American government billions of dollars in lost tax revenue.
------------
It was reported that Industrial and Commercial Bank of China, one of China's big state-owned lenders, had agreed to sell a 10% stake to a consortium led by Goldman Sachs for $3 billion. Another top institution, Bank of China, said that Temasek, the Singapore government's investment agency, would pay $3.1 billion for a 10% stake, in BoC's second deal with foreign investors in two weeks.
--------------
MasterCard announced it would have an initial public offering early next year that will give investors a 49% stake. The credit card association is also adopting new governance structures, including a board of mostly independent directors. MasterCard is currently owned by 1,400 financial institutions that issue its cards, but may face huge liabilities if it (and Visa) lose an antitrust lawsuit brought by competitors.
--------------
Old Mutual, a financial services group based in South Africa, confirmed it had held discussions about taking over Skandia, the Nordic region's biggest insurer, for around $5.7 billion. Skandia has suffered a series of high-profile resignations and financial scandals of late and recently reported a second-quarter net loss of SKr 1.47 billion ($192m).
-----------------
Fortress France?
France's industry minister, Franois Loos, said he would soon publish a list of the country's strategic industrial sectors that will be protected from foreign takeovers. Mr Loos's comments came the same week that a French building-materials firm made a euro5.4 billion ($6.6 billion) hostile bid for a British rival.
--------------------
In a deal that will create the world's biggest satellite operator, Intelsat announced it was buying PanAmSat for $3.2 billion. The merged firm will operate 53 satellites and combine Intelsat's telecoms speciality with PanAmSat's focus on television services.
-----------------
Following last week's unveiling by Google of its new voice communication service, Microsoft said it was buying Teleo, a small firm specialising in voice-over-internet-protocol (VOIP) technology. The move is more positioning in the industry's ongoing expansion into providing telephone services over the internet.
------------------
Creative, a digital audio company based in Singapore, revealed that it had been awarded a patent for its "Zen" portable media-player interface. The technology is used in Apple Computer's iPod, which Creative said is covered by the patent. Pundits speculated that Apple might face a lawsuit for royalties.
----------------
Workers at Boeing were due to vote on the terms of a new contract. Unions grumbled about pensions and that workers in the aircraft manufacturer's Wichita plant would be treated differently; strike action was mooted.
----------------
In a move that plants it firmly in the vaccine business. Novartis, a large pharmaceutical firm based in Switzerland, offered to buy the 58% of shares it does not already own in Chiron, for $4.5 billion. Based in California, Chiron earlier said it should be able to supply America's flu vaccine this winter. The plant that produces Fluvirin (in Britain) had its licence suspended last year, but has since received a favourable inspection from American regulators.
-------------------
ABN Amro announced what is thought to be one of the biggest-ever outsourcing deals. The Dutch bank said it will pay five groups, including IBM and India's Infosys, euro1.8 billion ($2.2 billion) over five years to manage its IT systems, which it hopes will result in annual savings of euro258m.
----------------
In order to stem a sharp fall in the rupiah, Indonesia's central bank raised its key interest rate by three-quarters of a percentage point, to 9.5%. The currency declined by around 10% against the dollar in August as investors worried about the country's extensive fuel-price subsidies to consumers.
--------------
Katrina's waves
Oil prices pushed above $70 a barrel as Hurricane Katrina forced the shutdown of operations near America's Gulf Coast, affecting 25% of the country's oil production. But the federal government's decision to loan crude oil from its strategic stockpile to refiners to alleviate the crisis eased prices back below the $70 mark.
---------------
SOURCE : Economist
KPMG agreed to pay $456m to settle an investigation by America's Justice Department into a fraudulent tax-shelter scheme offered to wealthy individuals. The "Big Four" accountancy firm will not now face criminal charges (although it has admitted wrongdoing and is on probation until the end of 2006), thus avoiding the fate that befell Arthur Andersen, which was brought to trial for its part in the Enron affair. However, eight former partners at KPMG were indicted. The shelters, which operated between 1996 and 2002 cost the American government billions of dollars in lost tax revenue.
------------
It was reported that Industrial and Commercial Bank of China, one of China's big state-owned lenders, had agreed to sell a 10% stake to a consortium led by Goldman Sachs for $3 billion. Another top institution, Bank of China, said that Temasek, the Singapore government's investment agency, would pay $3.1 billion for a 10% stake, in BoC's second deal with foreign investors in two weeks.
--------------
MasterCard announced it would have an initial public offering early next year that will give investors a 49% stake. The credit card association is also adopting new governance structures, including a board of mostly independent directors. MasterCard is currently owned by 1,400 financial institutions that issue its cards, but may face huge liabilities if it (and Visa) lose an antitrust lawsuit brought by competitors.
--------------
Old Mutual, a financial services group based in South Africa, confirmed it had held discussions about taking over Skandia, the Nordic region's biggest insurer, for around $5.7 billion. Skandia has suffered a series of high-profile resignations and financial scandals of late and recently reported a second-quarter net loss of SKr 1.47 billion ($192m).
-----------------
Fortress France?
France's industry minister, Franois Loos, said he would soon publish a list of the country's strategic industrial sectors that will be protected from foreign takeovers. Mr Loos's comments came the same week that a French building-materials firm made a euro5.4 billion ($6.6 billion) hostile bid for a British rival.
--------------------
In a deal that will create the world's biggest satellite operator, Intelsat announced it was buying PanAmSat for $3.2 billion. The merged firm will operate 53 satellites and combine Intelsat's telecoms speciality with PanAmSat's focus on television services.
-----------------
Following last week's unveiling by Google of its new voice communication service, Microsoft said it was buying Teleo, a small firm specialising in voice-over-internet-protocol (VOIP) technology. The move is more positioning in the industry's ongoing expansion into providing telephone services over the internet.
------------------
Creative, a digital audio company based in Singapore, revealed that it had been awarded a patent for its "Zen" portable media-player interface. The technology is used in Apple Computer's iPod, which Creative said is covered by the patent. Pundits speculated that Apple might face a lawsuit for royalties.
----------------
Workers at Boeing were due to vote on the terms of a new contract. Unions grumbled about pensions and that workers in the aircraft manufacturer's Wichita plant would be treated differently; strike action was mooted.
----------------
In a move that plants it firmly in the vaccine business. Novartis, a large pharmaceutical firm based in Switzerland, offered to buy the 58% of shares it does not already own in Chiron, for $4.5 billion. Based in California, Chiron earlier said it should be able to supply America's flu vaccine this winter. The plant that produces Fluvirin (in Britain) had its licence suspended last year, but has since received a favourable inspection from American regulators.
-------------------
ABN Amro announced what is thought to be one of the biggest-ever outsourcing deals. The Dutch bank said it will pay five groups, including IBM and India's Infosys, euro1.8 billion ($2.2 billion) over five years to manage its IT systems, which it hopes will result in annual savings of euro258m.
----------------
In order to stem a sharp fall in the rupiah, Indonesia's central bank raised its key interest rate by three-quarters of a percentage point, to 9.5%. The currency declined by around 10% against the dollar in August as investors worried about the country's extensive fuel-price subsidies to consumers.
--------------
Katrina's waves
Oil prices pushed above $70 a barrel as Hurricane Katrina forced the shutdown of operations near America's Gulf Coast, affecting 25% of the country's oil production. But the federal government's decision to loan crude oil from its strategic stockpile to refiners to alleviate the crisis eased prices back below the $70 mark.
---------------
SOURCE : Economist
Great stuff teesra banda ... Keep them coming...
Campus Confidential
Four top-tier B-schools don't disclose grades. Now that policy is under attack
Students at some top-ranked B-schools have a secret. It's something they can't share even if it means losing a job offer. It's one some have worked hard for and should be proud of, but instead they keep it to themselves. The secret is their grades.
At four of the nation's 10 most elite B-schools -- including Harvard, Stanford, and Chicago -- students have adopted policies that prohibit them or their schools from disclosing grades to recruiters. The idea is to reduce competitiveness and eliminate the risk associated with taking difficult courses. But critics say the only thing nondisclosure reduces is one of the most important lessons B-schools should teach: accountability.
It's a debate that's flaring up on B-school campuses across the country. And nowhere is it more intense than at University of Pennsylvania's Wharton School, where students, faculty, and administrators have locked horns over a school-initiated proposal that would effectively end a decade of grade secrecy at BusinessWeek's No. 3-ranked B-school. It wouldn't undo disclosure rules but would recognize the top 25% of each class -- in effect outing everyone else. It was motivated, says Vice-Dean Anjani Jain in a recent Wharton Journal article, by the "disincentivizing effects" of grade nondisclosure, which he says faculty blame for lackluster academic performance and student disengagement.
Just how contentious are things at Wharton? In cross-listed classes, Jain wrote, undergrads outperform MBAs, and the gap is widening. Annual student surveys, he wrote, show that the amount of time students spend on academics has fallen by 22% in just four years. Some of Wharton's best faculty have stopped teaching MBA classes altogether, he added. And those who continue now go to great lengths to keep students in check. Many prohibit late arrivals, talking, and cell phones. Others take attendance, as Harvard Business School does, or give weekly quizzes to make sure students show up for class. "Just like with traffic," says Edward I. George, a Wharton statistics professor. "You need traffic lights to function properly."
RECRUITER TURN-OFF
Professors aren't the only ones complaining. Recruiters say nondisclosure forces them to resort to interview techniques that test a candidate's quantitative skills. One is the "case interview," which requires job candidates to dissect complex case studies on the spot. In the absence of grades, Andrew Schwedel, who oversees recruiting at Bain & Co.'s San Francisco and Palo Alto (Calif.) offices, asks detailed questions to evaluate a candidate's potential -- everything from study group experiences to the courses they took. Richard McNulty, a former recruiter who heads career development at Dartmouth's Tuck School of Business, which allows students to decide whether or not grades are disclosed, says nondisclosure puts good students at a disadvantage and may discourage recruiters from coming to campus. Says McNulty: "I don't think eliminating grades would do anything but create more of a challenge . Students have to understand these implications."
As it turns out, many do. At No. 1 Northwestern's Kellogg School of Management and other top programs, including those at Cornell and Duke, students have opted to forgo nondisclosure, believing the value of their degrees would suffer. The University of Rochester's Simon Graduate School of Business may even expand grade disclosure. If the proposal is approved, the school will release grades on team projects -- an important indicator of whether a student pulls his or her own weight and works well with others. Says Dean Mark Zupan: "A business has a lot of team dynamic to it, and how well someone performs on a team is a valuable piece of information."
Nondisclosure policies were born during the dot-com boom, when MBAs had a choice of five or six job offers, each with promises of big signing bonuses and bloated benefits packages. At that point, grades didn't matter; MBAs were going to get job offers whether they graduated summa cum laude or at the bottom of their class.
Times have changed, but the policies have not -- and they're unlikely to anytime soon, since student support remains strong at schools that have them. Students say they serve an important pedagogical purpose, allowing them freedom to choose difficult electives, such as asset pricing or advanced microeconomics, without fear that a poor grade will kill job prospects. Pass/fail grading, which allows undergrads to take some classes without endangering their grade point averages, serves a similar purpose. "It allows people to explore," says Christopher Morris, director of career management at Wharton. Nondisclosure also fosters a more collaborative culture, supporters say. "If you were to disclose, it would put some people on a more competitive ," says Serhan Secmen, student president of the Wharton Graduate Assn.
For MBAs who aspire to the pinnacle of corporate power, that may not be such a bad thing. Students are unlikely to embrace such a change on their own, but if Wharton is any indication, the pressure to shine a light on grades is growing whether they like it or not.
SOURCE : BUSINESSWEEK
Yum! Brands
Fast food's yummy secret
America's second-biggest fast-food group is as successful as it is little known
IT IS one of the biggest companies in one of the biggest industries in America. Its brand names litter the highways and high streets of the world. From its modest base in Louisville, Kentucky, it oversees the opening of three new restaurants, one of them in China, every day. Last year it earned pre-tax profits of $1 billion on sales of $9 billion. Yet few of its customers have ever heard of it.
But if they know KFC (previously Kentucky Fried Chicken), or Pizza Hut, or Taco Bell, then they know Yum! Brands. The parent of those three fast-food chains, it has 34,000 (mostly franchised) restaurants around the world, 2,000 more than McDonald's. At home in America it accounts for about 4% of all restaurant-industry sales, behind only McDonald's at 6.5%. With 1,378 KFC restaurants in China, and 201 Pizza Huts at mid-2005, Yum! owns two of the best-known brand names in the world's most populous market. Not bad going, you might say, for a company that Pepsi-Cola got rid of in 1997 because, in the words of one PepsiCo executive, restaurants weren't our schtick.
Restaurants are very much the schtick of David Novak, the boss of Yum!, a PepsiCo veteran who was named president at the time of the spin-off. He became chief executive in 1999 and chairman in 2001, inheriting those jobs from Andrall Pearson, a former president of the PepsiCo group who was put in charge of Yum! to give the company stature on Wall Street. At PepsiCo Mr Pearson was rated one of the toughest bosses in America. Mr Novak, by contrast, was a dress-down, folksy, call-me-David type of boss who wanted people to feel that work should be fun too. The two men got on well, partly because Mr Pearson softened his approach when he saw how employees responded to Mr Novak's more accessible style, which included frequent presentations, tunefully accompanied by an in-house kazoo band, of rubber chickens and mechanical false teeth to employees who impressed him.
Mr Novak declared that he was going to love the franchisees, who owned 60% of Yum!'s restaurants at the time of the spin-off (the proportion is now about 75%), and whom PepsiCo had not always treated gently. Restaurant managers got stock options. The logic: if the managers were happy, they were more likely to treat well the crew members working the kitchen and the counter, whose efficiency and relative cheerfulness was also vital to the restaurants' success. Some morale-boosting has trickled down, but still not enough. The average American kitchen employee sticks at a job with Yum! for one year, almost twice as long as in 2000.
The spin-off gave Yum! (which was called Tricon until 2002) the chance to reap economies of scale across the restaurant brands, which had sometimes behaved more like rivals under PepsiCo. Advertising media-buying was unified through a single agency, for example. Individually, each brand might be the 40th or 50th biggest buyer in America, but collectively they were in the top five and Yum! could use that clout to get better deals. The acquisition of restaurant sites could be managed so that divisions would not bid against one another. International operations were brought within a single division, continuing a trend started under PepsiCo. This concentrated the resources needed to penetrate new markets, a strategy that has paid off handsomely in China. There, KFC has gone after the fast-food market, whereas Pizza Hut has positioned itself more as a place for casual dining, Taco Bell is just beginning to test the market and Yum! has set up a focused logistics and supply company to serve all of its chains.
Yum! may lack the concentrated efficiencies of McDonald's at its best. At McDonald's, vast resources power a single brand, generating sales per American restaurant almost twice as high as Yum!'s. But Yum! has come a long way since the spin-off in 1997, as has its share price (see chart 1). Most of that bounce has come in the past two years, as investors have fixed on Yum!'s impressive growth in China. There, operating profits have risen from $20m to $200m since 1998, and look set to go on growing. By getting into China early and boldly, Yum! has left even McDonald's in the dust. Sales faltered early this year when Yum! had to withdraw products containing an allegedly dangerous additive, sparking a public health scare. But that was quickly overcomegood practice if bird flu becomes a pandemic, perhapsand sales are recovering fast. If Yum! were in almost any other industry, the glow of admiration surrounding its early years as a publicly listed company would be almost embarrassing.
The fat years
But Yum!'s industry, fast food, has had a terrible few years in image terms, beset in America with controversies over obesity and animal welfare that may intensify. As the industry's leading brand, McDonald's has been first in line for many of these attacks. But such attacks have changed the psychological climate in which the entire industry operates, and they may yet change the legislative climate too.
The main cause of change has been a steady rise in the proportion of Americans characterised as overweight, from 47% (bad enough in itself) in the late 1970s to more than 65% in 2002, including 31% who were clinically obese (see chart 2). According to the government, medical costs attributable to obesity reached $75 billion in 2003, almost half of which fell on taxpayers through public health-care schemes. A paper this year in the Journal of the American Medical Association attributed about 112,000 premature deaths in 2000 to obesity.
The blame for this bloating has been laid mainly at the feet of the fast-food chains, whose American sales grew from about $6 billion in 1970 to a forecast $134 billion in 2005, and which have sold themselves mainly on their capacity to deliver very large quantities of food at very low prices. Eric Schlosser, author of Fast Food Nation, an influential book attacking the industry, points out that Americans spend more on fast food than they do on higher education, PCs or new cars.
A film denouncing McDonald's, Super Size Me, was nominated for an Academy Award this year and earned the third-highest ever box-office takings by a documentary. Its director, Morgan Spurlock, says that between 1971 and 2000 the average American woman's daily intake of calories rose from 1,542 to 1,877, and the average American man's from 2,450 to 2,618. The government recommends daily intakes of 1,600-2,000, and 2,200-2,400 calories respectively for adults doing only light physical activity. A single meal at a KFC can top 1,600 calories for less than a pound-weight of food plus a large Pepsiand the KFC menu is far from the most calorific. According to the Centre for Science in the Public Interest, an advocacy group, a cheese-and-French-fries dish popular in steakhouse chains contains about 3,000 calories, more than the total recommended daily food intake for an adult male. And that is a side dish.
Yum!, like other fast-food companies, has felt obliged to respond to health concerns. It has put more salads and lighter dishes on its menus, though without any great expectations. We are offering salads because that is what people want to see, says Mr Novak, choosing his verbs carefully. But the salads are not what the industry calls business builders: they are there to win over the veto vote, offering something to the calorie-conscious eater who might otherwise dissuade a whole family or group from going to a KFC or a Taco Bell.
Lawsuits brought on health-and-safety grounds have been more of a warning than a general threat to the fast-food industry so far. In 2003 a New York judge dismissed a lawsuit claiming that McDonald's had misled customers into believing that its food was healthy, but the suit was partially reinstated this year. Twenty American states have passed common sense consumption laws aimed at deterring obesity cases in local courts. But lawyers such as John Banzhaf, a professor of public interest law at George Washington University Law School in Washington, DC, still see a similarity between the position of fast-food companies now, and that of tobacco companies in the 1960s and 1970s, when private lawsuits paved the way for a co-ordinated attack on big tobacco by the attorneys-general of nine American states. The attorneys-general demanded that the companies compensate the states for publicly-born health-care costs attributed to smoking, and won a $250 billion award payable over 25 years.
Continued.........
Fast food's yummy secret
America's second-biggest fast-food group is as successful as it is little known
IT IS one of the biggest companies in one of the biggest industries in America. Its brand names litter the highways and high streets of the world. From its modest base in Louisville, Kentucky, it oversees the opening of three new restaurants, one of them in China, every day. Last year it earned pre-tax profits of $1 billion on sales of $9 billion. Yet few of its customers have ever heard of it.
But if they know KFC (previously Kentucky Fried Chicken), or Pizza Hut, or Taco Bell, then they know Yum! Brands. The parent of those three fast-food chains, it has 34,000 (mostly franchised) restaurants around the world, 2,000 more than McDonald's. At home in America it accounts for about 4% of all restaurant-industry sales, behind only McDonald's at 6.5%. With 1,378 KFC restaurants in China, and 201 Pizza Huts at mid-2005, Yum! owns two of the best-known brand names in the world's most populous market. Not bad going, you might say, for a company that Pepsi-Cola got rid of in 1997 because, in the words of one PepsiCo executive, restaurants weren't our schtick.
Restaurants are very much the schtick of David Novak, the boss of Yum!, a PepsiCo veteran who was named president at the time of the spin-off. He became chief executive in 1999 and chairman in 2001, inheriting those jobs from Andrall Pearson, a former president of the PepsiCo group who was put in charge of Yum! to give the company stature on Wall Street. At PepsiCo Mr Pearson was rated one of the toughest bosses in America. Mr Novak, by contrast, was a dress-down, folksy, call-me-David type of boss who wanted people to feel that work should be fun too. The two men got on well, partly because Mr Pearson softened his approach when he saw how employees responded to Mr Novak's more accessible style, which included frequent presentations, tunefully accompanied by an in-house kazoo band, of rubber chickens and mechanical false teeth to employees who impressed him.
Mr Novak declared that he was going to love the franchisees, who owned 60% of Yum!'s restaurants at the time of the spin-off (the proportion is now about 75%), and whom PepsiCo had not always treated gently. Restaurant managers got stock options. The logic: if the managers were happy, they were more likely to treat well the crew members working the kitchen and the counter, whose efficiency and relative cheerfulness was also vital to the restaurants' success. Some morale-boosting has trickled down, but still not enough. The average American kitchen employee sticks at a job with Yum! for one year, almost twice as long as in 2000.
The spin-off gave Yum! (which was called Tricon until 2002) the chance to reap economies of scale across the restaurant brands, which had sometimes behaved more like rivals under PepsiCo. Advertising media-buying was unified through a single agency, for example. Individually, each brand might be the 40th or 50th biggest buyer in America, but collectively they were in the top five and Yum! could use that clout to get better deals. The acquisition of restaurant sites could be managed so that divisions would not bid against one another. International operations were brought within a single division, continuing a trend started under PepsiCo. This concentrated the resources needed to penetrate new markets, a strategy that has paid off handsomely in China. There, KFC has gone after the fast-food market, whereas Pizza Hut has positioned itself more as a place for casual dining, Taco Bell is just beginning to test the market and Yum! has set up a focused logistics and supply company to serve all of its chains.
Yum! may lack the concentrated efficiencies of McDonald's at its best. At McDonald's, vast resources power a single brand, generating sales per American restaurant almost twice as high as Yum!'s. But Yum! has come a long way since the spin-off in 1997, as has its share price (see chart 1). Most of that bounce has come in the past two years, as investors have fixed on Yum!'s impressive growth in China. There, operating profits have risen from $20m to $200m since 1998, and look set to go on growing. By getting into China early and boldly, Yum! has left even McDonald's in the dust. Sales faltered early this year when Yum! had to withdraw products containing an allegedly dangerous additive, sparking a public health scare. But that was quickly overcomegood practice if bird flu becomes a pandemic, perhapsand sales are recovering fast. If Yum! were in almost any other industry, the glow of admiration surrounding its early years as a publicly listed company would be almost embarrassing.
The fat years
But Yum!'s industry, fast food, has had a terrible few years in image terms, beset in America with controversies over obesity and animal welfare that may intensify. As the industry's leading brand, McDonald's has been first in line for many of these attacks. But such attacks have changed the psychological climate in which the entire industry operates, and they may yet change the legislative climate too.
The main cause of change has been a steady rise in the proportion of Americans characterised as overweight, from 47% (bad enough in itself) in the late 1970s to more than 65% in 2002, including 31% who were clinically obese (see chart 2). According to the government, medical costs attributable to obesity reached $75 billion in 2003, almost half of which fell on taxpayers through public health-care schemes. A paper this year in the Journal of the American Medical Association attributed about 112,000 premature deaths in 2000 to obesity.
The blame for this bloating has been laid mainly at the feet of the fast-food chains, whose American sales grew from about $6 billion in 1970 to a forecast $134 billion in 2005, and which have sold themselves mainly on their capacity to deliver very large quantities of food at very low prices. Eric Schlosser, author of Fast Food Nation, an influential book attacking the industry, points out that Americans spend more on fast food than they do on higher education, PCs or new cars.
A film denouncing McDonald's, Super Size Me, was nominated for an Academy Award this year and earned the third-highest ever box-office takings by a documentary. Its director, Morgan Spurlock, says that between 1971 and 2000 the average American woman's daily intake of calories rose from 1,542 to 1,877, and the average American man's from 2,450 to 2,618. The government recommends daily intakes of 1,600-2,000, and 2,200-2,400 calories respectively for adults doing only light physical activity. A single meal at a KFC can top 1,600 calories for less than a pound-weight of food plus a large Pepsiand the KFC menu is far from the most calorific. According to the Centre for Science in the Public Interest, an advocacy group, a cheese-and-French-fries dish popular in steakhouse chains contains about 3,000 calories, more than the total recommended daily food intake for an adult male. And that is a side dish.
Yum!, like other fast-food companies, has felt obliged to respond to health concerns. It has put more salads and lighter dishes on its menus, though without any great expectations. We are offering salads because that is what people want to see, says Mr Novak, choosing his verbs carefully. But the salads are not what the industry calls business builders: they are there to win over the veto vote, offering something to the calorie-conscious eater who might otherwise dissuade a whole family or group from going to a KFC or a Taco Bell.
Lawsuits brought on health-and-safety grounds have been more of a warning than a general threat to the fast-food industry so far. In 2003 a New York judge dismissed a lawsuit claiming that McDonald's had misled customers into believing that its food was healthy, but the suit was partially reinstated this year. Twenty American states have passed common sense consumption laws aimed at deterring obesity cases in local courts. But lawyers such as John Banzhaf, a professor of public interest law at George Washington University Law School in Washington, DC, still see a similarity between the position of fast-food companies now, and that of tobacco companies in the 1960s and 1970s, when private lawsuits paved the way for a co-ordinated attack on big tobacco by the attorneys-general of nine American states. The attorneys-general demanded that the companies compensate the states for publicly-born health-care costs attributed to smoking, and won a $250 billion award payable over 25 years.
Continued.........
Continued.............
This is not tobacco or asbestos, there is no single food source that can be blamed for obesity, says Mr Novak. The industry will be able to deal with this. He says that neither the threat of litigation nor recent attacks on KFC by animal-rights activists are doing anything to change the fundamental strategies or the fundamental values of Yum!. We listen to the voice of the customer, we follow all the regulations, we make great food, he says.
Others are less sanguine. At an obesity conference in New York in February sponsored by UBS, a Swiss bank, expert panellists said that American states' attorneys might indeed begin looking for obesity-related settlement funds in the face of ballooning public-health costs; that current lawsuits and other public attacks on the fast-food industry could be softening the landscape for future litigation; and that public opinion would be the deciding factor. If the public becomes convinced over time that obesity is a big enough problem to require governmental regulation, or that companies are somehow to blame, the conference concluded, then the courts and politicians will likely follow. Worries about rising obesity rates among children, and fear of subsequent legal actions, are already causing companies to scale back their marketing of fatty food and soft drinks to minors. Restraint is seen as the best defence against statutory controls.
Burgeoning in Beijing
While the political and legal arguments over obesity in America go on growing, overeating may possibly have peaked. The proportion of overweight adults was two percentage-points lower in 2004 than in 2002, according to household surveys by the NPD Group, a business-information company (though Trust for America's Health, an advocacy group, said this week that obesity was still rising). That may be good news for fast-food companies in legal terms. But it also signals less appetite for their traditional products. The average American bought 3% fewer take-away meals last year than in 2000, says NPD. The fastest-growing take-away food franchises in America now are sandwich bars, led by Subway and Quiznos, which can plausibly claim to offer a healthy alternative to the deep-fried and mostly-meat products of the hamburger, chicken and taco chains. Subway's advertising campaigns are centred around a real-life figure called Jared Fogle who claims to have lost 245 pounds in weight by eating mainly Subway sandwiches. Jeffrey Merrihue, a marketing expert with Accenture, a consulting firm, says the Fogle factor is almost unbelievable, but massively importantit has changed the industry.
Nor does there seem much scope for traditional fast-food chains to grow in America by opening new outlets. According to UBS, three-quarters of Americans already live within three miles of a McDonald's. Two-thirds live within three miles of a Pizza Hut and a Taco Bell and a KFC as well. That is hardly any distance for a population that spends so much time in cars (though rising petrol prices are starting to bite). Two-thirds of purchases at these chains go out through the drive-in window, says UBS. To expand, then, the chains will have to win business from one another, using new pitches and products.
But the tougher the fight, the more size should count, if smartly used. Yum! has the resources to get things right in the end, even with some wobbles along the way. It brought Taco Bell back from a very bumpy patch in 1998-99, when falling sales forced some franchisees to turn to Yum! for loans. Lately it has nursed KFC through three years of weak sales, when too little product development left the brand looking tired and poorly positioned, according to Restaurant Research, an independent consultancy. Partly by trial and error, Yum! hit on two strategies for putting KFC right. It added a cheap hot sandwich to the menu, called a Snacker, which is easy to eat (unlike chicken on the bone). And it started a makeover of the brand image, bringing back the full Kentucky Fried Chicken name at some outlets, giving new prominence to touched-up portraits of Colonel Harland Sanders, the chain's founder, and promoting once more the cardboard buckets of chicken it had abandoned briefly in the 1990s.
A longer-term Yum! strategy, cutting across all its brands, is to put two or sometimes three of its brands into a single restaurant, with a common kitchen. This means additional training and equipment, but it boosts customer volume and makes new outlets economic in places where the population would be too small, or the real estate too expensive, for one brand alone.
These strategies have helped Yum! to increase same-store sales by 3% year-on-year in the first half of 2005less than the 5% growth for the same period at McDonald's, but better than the zero growth Yum! was getting from its American stores two years ago. Mr Novak thinks there is more growth left in the American market than the conventional wisdom allows, and he is optimistic about continental Europe too. But he also recognises that people are not buying our stock because of the US, they are buying it because of China.
Good ole Uncle Sam
In China, Yum! has combined the luck and skill needed to be in the right place at the right time. It got in early, did well, bet bigger and has prospered ever sincea tribute to its country management, led by Sam Su, president for China since 1997. Yum! reckons that 500m urban Chinese can so far afford its food, leaving another 800m still to come into the market. Mr Novak likens the Chinese market to the American one in the 1950s, when the fast-food industry was inventing itself. And in China, Yum! has more of a first-mover advantage than Colonel Sanders or even McDonald's ever did. It has two strong brands, twice the restaurants of its nearest rival, McDonald's, and young people queuing up to work for it: more than 80% of its restaurant managers in China are college graduates. Thanks partly to China, this year Yum! is making about two-fifths of its operating profits outside America, up from one-fifth in 1998. It could take only a few more good years in China, and a few flat years in America, to tilt the balance decisively.
China might seem an exotic market for an American fast-food firm, but it is a logical one. Yum!'s core business is not really making food, but feeding people, and China is where the people are. Yum! gives them what they appear to want, repackaging it often enough to keep it interesting. Yum! is, in its way, as plain and simple as a huge company could be. Its key values are persistence, ingenuity and good humour. It is living proof that in the food industry, as in the newspaper business, you will never go bust by under-estimating the public taste. But you have to do it cheaply, efficiently and on a very large scale.
SOURCE : Economist
This is not tobacco or asbestos, there is no single food source that can be blamed for obesity, says Mr Novak. The industry will be able to deal with this. He says that neither the threat of litigation nor recent attacks on KFC by animal-rights activists are doing anything to change the fundamental strategies or the fundamental values of Yum!. We listen to the voice of the customer, we follow all the regulations, we make great food, he says.
Others are less sanguine. At an obesity conference in New York in February sponsored by UBS, a Swiss bank, expert panellists said that American states' attorneys might indeed begin looking for obesity-related settlement funds in the face of ballooning public-health costs; that current lawsuits and other public attacks on the fast-food industry could be softening the landscape for future litigation; and that public opinion would be the deciding factor. If the public becomes convinced over time that obesity is a big enough problem to require governmental regulation, or that companies are somehow to blame, the conference concluded, then the courts and politicians will likely follow. Worries about rising obesity rates among children, and fear of subsequent legal actions, are already causing companies to scale back their marketing of fatty food and soft drinks to minors. Restraint is seen as the best defence against statutory controls.
Burgeoning in Beijing
While the political and legal arguments over obesity in America go on growing, overeating may possibly have peaked. The proportion of overweight adults was two percentage-points lower in 2004 than in 2002, according to household surveys by the NPD Group, a business-information company (though Trust for America's Health, an advocacy group, said this week that obesity was still rising). That may be good news for fast-food companies in legal terms. But it also signals less appetite for their traditional products. The average American bought 3% fewer take-away meals last year than in 2000, says NPD. The fastest-growing take-away food franchises in America now are sandwich bars, led by Subway and Quiznos, which can plausibly claim to offer a healthy alternative to the deep-fried and mostly-meat products of the hamburger, chicken and taco chains. Subway's advertising campaigns are centred around a real-life figure called Jared Fogle who claims to have lost 245 pounds in weight by eating mainly Subway sandwiches. Jeffrey Merrihue, a marketing expert with Accenture, a consulting firm, says the Fogle factor is almost unbelievable, but massively importantit has changed the industry.
Nor does there seem much scope for traditional fast-food chains to grow in America by opening new outlets. According to UBS, three-quarters of Americans already live within three miles of a McDonald's. Two-thirds live within three miles of a Pizza Hut and a Taco Bell and a KFC as well. That is hardly any distance for a population that spends so much time in cars (though rising petrol prices are starting to bite). Two-thirds of purchases at these chains go out through the drive-in window, says UBS. To expand, then, the chains will have to win business from one another, using new pitches and products.
But the tougher the fight, the more size should count, if smartly used. Yum! has the resources to get things right in the end, even with some wobbles along the way. It brought Taco Bell back from a very bumpy patch in 1998-99, when falling sales forced some franchisees to turn to Yum! for loans. Lately it has nursed KFC through three years of weak sales, when too little product development left the brand looking tired and poorly positioned, according to Restaurant Research, an independent consultancy. Partly by trial and error, Yum! hit on two strategies for putting KFC right. It added a cheap hot sandwich to the menu, called a Snacker, which is easy to eat (unlike chicken on the bone). And it started a makeover of the brand image, bringing back the full Kentucky Fried Chicken name at some outlets, giving new prominence to touched-up portraits of Colonel Harland Sanders, the chain's founder, and promoting once more the cardboard buckets of chicken it had abandoned briefly in the 1990s.
A longer-term Yum! strategy, cutting across all its brands, is to put two or sometimes three of its brands into a single restaurant, with a common kitchen. This means additional training and equipment, but it boosts customer volume and makes new outlets economic in places where the population would be too small, or the real estate too expensive, for one brand alone.
These strategies have helped Yum! to increase same-store sales by 3% year-on-year in the first half of 2005less than the 5% growth for the same period at McDonald's, but better than the zero growth Yum! was getting from its American stores two years ago. Mr Novak thinks there is more growth left in the American market than the conventional wisdom allows, and he is optimistic about continental Europe too. But he also recognises that people are not buying our stock because of the US, they are buying it because of China.
Good ole Uncle Sam
In China, Yum! has combined the luck and skill needed to be in the right place at the right time. It got in early, did well, bet bigger and has prospered ever sincea tribute to its country management, led by Sam Su, president for China since 1997. Yum! reckons that 500m urban Chinese can so far afford its food, leaving another 800m still to come into the market. Mr Novak likens the Chinese market to the American one in the 1950s, when the fast-food industry was inventing itself. And in China, Yum! has more of a first-mover advantage than Colonel Sanders or even McDonald's ever did. It has two strong brands, twice the restaurants of its nearest rival, McDonald's, and young people queuing up to work for it: more than 80% of its restaurant managers in China are college graduates. Thanks partly to China, this year Yum! is making about two-fifths of its operating profits outside America, up from one-fifth in 1998. It could take only a few more good years in China, and a few flat years in America, to tilt the balance decisively.
China might seem an exotic market for an American fast-food firm, but it is a logical one. Yum!'s core business is not really making food, but feeding people, and China is where the people are. Yum! gives them what they appear to want, repackaging it often enough to keep it interesting. Yum! is, in its way, as plain and simple as a huge company could be. Its key values are persistence, ingenuity and good humour. It is living proof that in the food industry, as in the newspaper business, you will never go bust by under-estimating the public taste. But you have to do it cheaply, efficiently and on a very large scale.
SOURCE : Economist
Hi All,
First of all great work by teesra bandha. I am attaching an article on definition of Risk. It is really abstract if anyone can figure out what the essence is all about please explain in simple terms for me.
Source:http://www.contingencyanalysis.com/
Are Failed Infrastructure Projects Linked to the Presence of the IMF or World Bank? Read on ...
Witold Henisz calls it the "mob-on-the-street story."
He's heard it time and again from Western investors who have financed infrastructure improvement projects in developing countries. It goes something like this: Angry crowds protesting on the street. Political unrest. Governments caving in. Privatization failing. Money being lost. And, Henisz says, one last common denominator that made him more than a little curious: The involvement of the International Monetary Fund or the World Bank.
Henisz and his colleagues -- Bennet A. Zelner from the University of California at Berkeley, Guy Holburn from the University of Western Ontario and Mauro F. Guilln, a Wharton professor of management and sociology -- did just that. They combed through three decades of market reform and industry decentralization projects in dozens of countries the world over, looking for a link between failed or troubled reform efforts and the presence of the IMF or World Bank.
They found one. Working on two separate papers, Henisz and his colleagues turned up striking evidence that suggests the "mob-on-the-street story" -- and the idea that the IMF and World Bank were at least partly to blame for it -- isn't all that far-fetched. According to their research, the IMF and World Bank can and do play a significant role in implementing market reform and infrastructure projects in developing countries -- but often in a negative way. Further, the team found that when the IMF and World Bank are involved in these projects, disputes between investors and the government, government renegotiations of contracts, and even rollback of privatization efforts can follow. The two papers are called "The Worldwide Diffusion of Market-Oriented Infrastructure Reform, 1977-1999" and "Deinstitutionalization and Institutional Replacement: State-Centered and Neo-liberal Models in the Global Electricity Supply Industry."
Lessons for Investors
Their research suggests that the ongoing criticism of the IMF and World Bank -- that the institutions have strayed from their mission, that their policies are counterproductive and that they have not done enough to help needy nations -- might be partially justified. It also holds a lesson, Henisz says, for potential overseas investors. "If you see the IMF and the World Bank influencing reforms in a country, recognize that there are risks associated with that. There's risk of backlash against you and against the IMF or World Bank. It's not a seal of approval. It's a warning flag, and one you have to recognize and deal with."
Before Henisz could reach that conclusion, he first had to answer a much simpler question: Do the IMF and World Bank, via their money lending, actually impact domestic policy decisions?
After analyzing dozens of nations' efforts to privatize and deregulate their power and telecommunications industries, Henisz and his co-authors found the answer to be an emphatic "yes." They established that it's not just the political state of a country that investors should look at when deciding whether to put their money there, but also a range of other factors -- the presence of the IMF or World Bank included.
Henisz, Zelner and Guilln first studied telecommunication and electricity market reforms in 71 countries and territories between 1977 and 1999 and found that multilateral lenders' coercive actions "may not produce ideal outcomes." It's difficult enough to get such reforms passed, they note, when the conditions are right: Of the 190 nations and territories that have attempted to privatize their electric industries, just 2% have fully completed the transition. Even as the researchers noted "deregulation and liberalization do, in many cases, improve the economic performance of industries previously owned by the state," they also are quick to point out how difficult such transitions are -- and say outside pressure from groups like the IMF or World Bank can lead to inappropriate policy mixes.
"We find that, after taking domestic political and economic factors into account, international forces have a strong effect on the domestic adoption of market-oriented infrastructure policies," the researchers write. "International coercive pressures increase the likelihood of majority privatization and regulatory separation, but not of regulatory depoliticization and liberalization of competition." All four of these reform elements are needed to generate sustainable market involvement in infrastructure services.
But why should the involvement of these large multilateral institutions -- founded, as they were, in the interest of global good and having a positive impact on regulatory reform and privatization -- be a bad thing? The reason, Henisz says, is rooted in their lending policies. Loans from those groups inevitably come along with certain conditions -- and a good degree of pressure -- that can stir unrest among populations resenting what they may perceive to be foreign control over their country. "I think for a long time people have focused on the potential benefits of the reforms," Henisz says. "People thought, 'Well, you just deregulate the market and that's the answer.' But the market part is only focused on efficiency, and people can be resentful that foreign are forcing you to make a change. That can cause a dynamic that can have a real impact." In fact, Henisz, Holburn and Zelner found that investors who sent their money to nations facing above-average pressures to enact reforms from the IMF or World Bank are 63% more likely to face subsequent government interference with those reforms -- a sign that the reforms may fail -- than investors in countries where the World Bank and IMF are exerting less pressure.
The researchers say that if the IMF and World Bank push through inappropriate reforms in nations not politically ready for them, failure -- and the appearance of that "mob on the street" -- is increasingly likely. "Citizens in a country pressured into market-oriented reform when poor industry performance does not create demands for such reform, or when the national policymaking apparatus lacks sufficient checks and balances to support a well-organized market," they write, "may fare worse than those in a country adopting reform as the result of clear performance shortfalls and in the presence of domestic institutional support."
The old story about the IMF and World Bank -- that "you find firemen at fires" -- is not sufficient to explain the lenders' track record of showing up in troubled nations, the research suggests. "I don't think people previously had talked about that backlash, and the idea that is not a sign of approval, but a warning flag," Henisz says. "It's not just that these lenders are going to troubled countries and that these countries are more likely to have additional trouble down the road. We're finding that the association with the IMF and the World Bank increases the risk for investors."
Triggers of Trouble
"There's been a lot of criticism of the World Bank and the IMF, but this is the first study, conducted across dozens of countries, that shows the IMF and World Bank really do have a micro-level impact," Henisz says, adding that, unfortunately, many managers -- especially at the board and upper management levels -- don't yet understand that. The problem of domestic backlash, he notes, continues to be underestimated. "When we were in Latin America and Thailand and Indonesia, we were there when this was becoming a big issue, and now it's even larger," he says. "We were intrigued and we wanted to be at the center of what's going on. But for a number of Western investors, they haven't grasped the nature of it. You have to do things in Bolivia that you wouldn't do in Texas to sell power."
Selling decentralization and market reforms in these nations is a politically tricky task, and making them work will require companies to be more than simply good businessmen. They will have to be able to win over a populace that is just as likely to protest their intrusion as celebrate their arrival. That means companies banking on making money in these developing countries can't waltz in and expect a warm greeting. To win approval in Third World and developing nations, investors and corporations should expect to play politics, win over the populace with community work or take other unusual steps.
The issue isn't going away soon, says Henisz, who hopes to visit Georgia and Bolivia -- countries that recently faced domestic unrest over market reforms -- and talk with more investors who have had trouble dealing with the multilateral lenders. Eventually, he hopes to more fully understand the dynamics caused by IMF and World Bank involvement -- and protect investors in years to come. "I'm fascinated by this," he says. "I want to be at the center of this backlash, learn what's happening on the ground, and figure out what a manager can do to secure investments and, through sophisticated management of political risk and opportunities, increase returns for the shareholders."
Source : Wharton Business School
Witold Henisz calls it the "mob-on-the-street story."
He's heard it time and again from Western investors who have financed infrastructure improvement projects in developing countries. It goes something like this: Angry crowds protesting on the street. Political unrest. Governments caving in. Privatization failing. Money being lost. And, Henisz says, one last common denominator that made him more than a little curious: The involvement of the International Monetary Fund or the World Bank.
Henisz and his colleagues -- Bennet A. Zelner from the University of California at Berkeley, Guy Holburn from the University of Western Ontario and Mauro F. Guilln, a Wharton professor of management and sociology -- did just that. They combed through three decades of market reform and industry decentralization projects in dozens of countries the world over, looking for a link between failed or troubled reform efforts and the presence of the IMF or World Bank.
They found one. Working on two separate papers, Henisz and his colleagues turned up striking evidence that suggests the "mob-on-the-street story" -- and the idea that the IMF and World Bank were at least partly to blame for it -- isn't all that far-fetched. According to their research, the IMF and World Bank can and do play a significant role in implementing market reform and infrastructure projects in developing countries -- but often in a negative way. Further, the team found that when the IMF and World Bank are involved in these projects, disputes between investors and the government, government renegotiations of contracts, and even rollback of privatization efforts can follow. The two papers are called "The Worldwide Diffusion of Market-Oriented Infrastructure Reform, 1977-1999" and "Deinstitutionalization and Institutional Replacement: State-Centered and Neo-liberal Models in the Global Electricity Supply Industry."
Lessons for Investors
Their research suggests that the ongoing criticism of the IMF and World Bank -- that the institutions have strayed from their mission, that their policies are counterproductive and that they have not done enough to help needy nations -- might be partially justified. It also holds a lesson, Henisz says, for potential overseas investors. "If you see the IMF and the World Bank influencing reforms in a country, recognize that there are risks associated with that. There's risk of backlash against you and against the IMF or World Bank. It's not a seal of approval. It's a warning flag, and one you have to recognize and deal with."
Before Henisz could reach that conclusion, he first had to answer a much simpler question: Do the IMF and World Bank, via their money lending, actually impact domestic policy decisions?
After analyzing dozens of nations' efforts to privatize and deregulate their power and telecommunications industries, Henisz and his co-authors found the answer to be an emphatic "yes." They established that it's not just the political state of a country that investors should look at when deciding whether to put their money there, but also a range of other factors -- the presence of the IMF or World Bank included.
Henisz, Zelner and Guilln first studied telecommunication and electricity market reforms in 71 countries and territories between 1977 and 1999 and found that multilateral lenders' coercive actions "may not produce ideal outcomes." It's difficult enough to get such reforms passed, they note, when the conditions are right: Of the 190 nations and territories that have attempted to privatize their electric industries, just 2% have fully completed the transition. Even as the researchers noted "deregulation and liberalization do, in many cases, improve the economic performance of industries previously owned by the state," they also are quick to point out how difficult such transitions are -- and say outside pressure from groups like the IMF or World Bank can lead to inappropriate policy mixes.
"We find that, after taking domestic political and economic factors into account, international forces have a strong effect on the domestic adoption of market-oriented infrastructure policies," the researchers write. "International coercive pressures increase the likelihood of majority privatization and regulatory separation, but not of regulatory depoliticization and liberalization of competition." All four of these reform elements are needed to generate sustainable market involvement in infrastructure services.
But why should the involvement of these large multilateral institutions -- founded, as they were, in the interest of global good and having a positive impact on regulatory reform and privatization -- be a bad thing? The reason, Henisz says, is rooted in their lending policies. Loans from those groups inevitably come along with certain conditions -- and a good degree of pressure -- that can stir unrest among populations resenting what they may perceive to be foreign control over their country. "I think for a long time people have focused on the potential benefits of the reforms," Henisz says. "People thought, 'Well, you just deregulate the market and that's the answer.' But the market part is only focused on efficiency, and people can be resentful that foreign are forcing you to make a change. That can cause a dynamic that can have a real impact." In fact, Henisz, Holburn and Zelner found that investors who sent their money to nations facing above-average pressures to enact reforms from the IMF or World Bank are 63% more likely to face subsequent government interference with those reforms -- a sign that the reforms may fail -- than investors in countries where the World Bank and IMF are exerting less pressure.
The researchers say that if the IMF and World Bank push through inappropriate reforms in nations not politically ready for them, failure -- and the appearance of that "mob on the street" -- is increasingly likely. "Citizens in a country pressured into market-oriented reform when poor industry performance does not create demands for such reform, or when the national policymaking apparatus lacks sufficient checks and balances to support a well-organized market," they write, "may fare worse than those in a country adopting reform as the result of clear performance shortfalls and in the presence of domestic institutional support."
The old story about the IMF and World Bank -- that "you find firemen at fires" -- is not sufficient to explain the lenders' track record of showing up in troubled nations, the research suggests. "I don't think people previously had talked about that backlash, and the idea that is not a sign of approval, but a warning flag," Henisz says. "It's not just that these lenders are going to troubled countries and that these countries are more likely to have additional trouble down the road. We're finding that the association with the IMF and the World Bank increases the risk for investors."
Triggers of Trouble
"There's been a lot of criticism of the World Bank and the IMF, but this is the first study, conducted across dozens of countries, that shows the IMF and World Bank really do have a micro-level impact," Henisz says, adding that, unfortunately, many managers -- especially at the board and upper management levels -- don't yet understand that. The problem of domestic backlash, he notes, continues to be underestimated. "When we were in Latin America and Thailand and Indonesia, we were there when this was becoming a big issue, and now it's even larger," he says. "We were intrigued and we wanted to be at the center of what's going on. But for a number of Western investors, they haven't grasped the nature of it. You have to do things in Bolivia that you wouldn't do in Texas to sell power."
Selling decentralization and market reforms in these nations is a politically tricky task, and making them work will require companies to be more than simply good businessmen. They will have to be able to win over a populace that is just as likely to protest their intrusion as celebrate their arrival. That means companies banking on making money in these developing countries can't waltz in and expect a warm greeting. To win approval in Third World and developing nations, investors and corporations should expect to play politics, win over the populace with community work or take other unusual steps.
The issue isn't going away soon, says Henisz, who hopes to visit Georgia and Bolivia -- countries that recently faced domestic unrest over market reforms -- and talk with more investors who have had trouble dealing with the multilateral lenders. Eventually, he hopes to more fully understand the dynamics caused by IMF and World Bank involvement -- and protect investors in years to come. "I'm fascinated by this," he says. "I want to be at the center of this backlash, learn what's happening on the ground, and figure out what a manager can do to secure investments and, through sophisticated management of political risk and opportunities, increase returns for the shareholders."
Source : Wharton Business School
Hi all,
Hope this is the right place to shoot my doubts at. If not, please let me know.
Anyone please help me.
1) Where can I get the very basic info relating to Forex reserves, EXIM policies, GDP ?
2) What does MATURITY mean when we speak about loans ?
Looking forward to your response.
Bye.
Hi all,
Hope this is the right place to shoot my doubts at. If not, please let me know.
Anyone please help me.
1) Where can I get the very basic info relating to Forex reserves, EXIM policies, GDP ?
2) What does MATURITY mean when we speak about loans ?
Looking forward to your response.
Bye.
Buddy !
U can get these information from some of these links:
Glossary of economic terms:
http://www.mfc.edu/glossery/a.htm
All statistics u can get from Various ministries websites and RBI's website
Indian Government Directory
http://goidirectory.nic.in/
Other financial sites offering u various information:
http://investopedia.com/
www.indiainfoline.com and many other sites are there....
Monthly Economic Report of JULY '05 from RBI is attached which gives statistics of various sectors of economy including your forex reserves
!!!Cheers !!!
Hi all,
Hope this is the right place to shoot my doubts at. If not, please let me know.
Anyone please help me.
1) Where can I get the very basic info relating to Forex reserves, EXIM policies, GDP ?
2) What does MATURITY mean when we speak about loans ?
Looking forward to your response.
Bye.
For EXIM Policy go to the DGFT website at
http://dgft.delhi.nic.in/
Vijay has already given a comprehensive info on FOREX Reserves and GDP.
Thanks Vijay and Govi, for giving me scores of info.
This Week's BUSINESS Headlines are as under :
Fazio under fire
Antonio Fazio, the governor of Italy's central bank, came under intense pressure to resign. Both Italy's finance minister and deputy prime minister led calls for Mr Fazio to go because of his alleged intervention and favouritism in a highly contested battle between an Italian and a Dutch bank to take over Banca Antonveneta. Last week, the government backed a reform plan for the Bank of Italy that includes ending the lifetime appointment of governors.
_____________
Julius Baer, one of Switzerland's leading financial institutions, bought three banks and an investment firm from UBS for SFr5.6 billion ($4.5 billion). The firm wants to expand in Asian and Middle Eastern markets. More consolidation is expected in Switzerland's fragmented private banking sector.
______________
Endesa, Spain's biggest energy group, rejected a euro22.5 billion ($28.1 billion) takeover offer by Gas Natural, a smaller rival that proposed selling some of Endesa's assets to help finance its deal. Meanwhile, E.ON, a German utility group, confirmed it was interested in buying Scottish Power. The bids are the latest moves at consolidation among European energy firms before 2007 when the region's retail energy market is set to be fully liberalised.
_________________
Amid fears of new global pandemics, big drug firms are trying to expand their stakes in the vaccine business. This week GlaxoSmithKline agreed to buy ID Biomedical, a Canadian vaccine-maker, for $1.4 billion. Novartis's $4.5 billion takeover bid was rejected by independent directors at Chiron, a Californian vaccine firm in which Novartis already has a 42% stake.
______________________
A bad week for Boeing. Machinists went on strike over benefits in a new contract. The last machinists' strike at Boeing lasted for 69 days in 1995. Boeing's arch-rival Airbus announced that China Southern Airlines, one of China's biggest, had bought ten Airbus A330 aircraft for $1.5 billion.
_____________________
In direct competition to Boeing, Northrop Grumman said it will team up with EADS, Airbus's parent company, to compete for the Pentagon's air-refuelling tanker contract, worth up to $100 billion over 30 years.
_____________________
BMW is to join DaimlerChrysler and General Motors in a project that develops new hybrid technologies for vehicles. Japanese carmakers, which lead the market for petrol-electric cars, have seen sales soar recently in America as consumers look for ways to reduce their fuel costs.
_____________________
In the third big shipping merger this year, CMA CGM, France's largest container-shipping line, said it had agreed the terms of its takeover of Delmas, a rival group specialising in routes to Africa, for $600m. The new company passes Taiwan's Evergreen to become the world's third-biggest shipper.
________________
Microsoft asked a court in Washington state to halt a former executive's employment by Google. Kai-Fu Lee joined Google in July to oversee its development in China. Microsoft argues that he knows intimate details of its Chinese operations.
________________
Anticipating a wave of new competition for its popular iPod, Apple Computer unveiled a mobile-phone handset, made by Motorola, which can play music from its iTunes online music store.
___________________
Another victory for attempts to stem illegal file-swapping over the internet. A court in Australia ordered the owners of Kazaa Media Desktop, Sharman Networks, of Sydney, to amend the software so that it does not allow the downloading of copyrighted music or film.
_____________
PartyGaming, the internet's leading poker site, saw its share price fall by 33% after it revealed that new customer growth and spending by players had slowed more than nticipated, worrying investors that the online gaming boom may be ending.
_________________
The EU reached a deal with China on textile imports that releases millions of garments impounded in Europe's warehouses because quotas have been filled. At a meeting in Beijing, the EU and China agreed that half the backlog could count towards next year's quota.
______________
Oil prices fell back from last week's all-time high and traded at around $65 per barrel. However, analysts feared that the damage wrought by Hurricane Katrina might mean
further price increases.
______________
America's unemployment rate fell to 4.9% in August, the lowest it has been since August 2001. However, the good news was overshadowed by a gloomy prediction from the CBO about Hurricane Katrina's impact on the labour market: 400,000 jobs may be lost by the end of the year.
SOURCE : Economist
Fazio under fire
Antonio Fazio, the governor of Italy's central bank, came under intense pressure to resign. Both Italy's finance minister and deputy prime minister led calls for Mr Fazio to go because of his alleged intervention and favouritism in a highly contested battle between an Italian and a Dutch bank to take over Banca Antonveneta. Last week, the government backed a reform plan for the Bank of Italy that includes ending the lifetime appointment of governors.
_____________
Julius Baer, one of Switzerland's leading financial institutions, bought three banks and an investment firm from UBS for SFr5.6 billion ($4.5 billion). The firm wants to expand in Asian and Middle Eastern markets. More consolidation is expected in Switzerland's fragmented private banking sector.
______________
Endesa, Spain's biggest energy group, rejected a euro22.5 billion ($28.1 billion) takeover offer by Gas Natural, a smaller rival that proposed selling some of Endesa's assets to help finance its deal. Meanwhile, E.ON, a German utility group, confirmed it was interested in buying Scottish Power. The bids are the latest moves at consolidation among European energy firms before 2007 when the region's retail energy market is set to be fully liberalised.
_________________
Amid fears of new global pandemics, big drug firms are trying to expand their stakes in the vaccine business. This week GlaxoSmithKline agreed to buy ID Biomedical, a Canadian vaccine-maker, for $1.4 billion. Novartis's $4.5 billion takeover bid was rejected by independent directors at Chiron, a Californian vaccine firm in which Novartis already has a 42% stake.
______________________
A bad week for Boeing. Machinists went on strike over benefits in a new contract. The last machinists' strike at Boeing lasted for 69 days in 1995. Boeing's arch-rival Airbus announced that China Southern Airlines, one of China's biggest, had bought ten Airbus A330 aircraft for $1.5 billion.
_____________________
In direct competition to Boeing, Northrop Grumman said it will team up with EADS, Airbus's parent company, to compete for the Pentagon's air-refuelling tanker contract, worth up to $100 billion over 30 years.
_____________________
BMW is to join DaimlerChrysler and General Motors in a project that develops new hybrid technologies for vehicles. Japanese carmakers, which lead the market for petrol-electric cars, have seen sales soar recently in America as consumers look for ways to reduce their fuel costs.
_____________________
In the third big shipping merger this year, CMA CGM, France's largest container-shipping line, said it had agreed the terms of its takeover of Delmas, a rival group specialising in routes to Africa, for $600m. The new company passes Taiwan's Evergreen to become the world's third-biggest shipper.
________________
Microsoft asked a court in Washington state to halt a former executive's employment by Google. Kai-Fu Lee joined Google in July to oversee its development in China. Microsoft argues that he knows intimate details of its Chinese operations.
________________
Anticipating a wave of new competition for its popular iPod, Apple Computer unveiled a mobile-phone handset, made by Motorola, which can play music from its iTunes online music store.
___________________
Another victory for attempts to stem illegal file-swapping over the internet. A court in Australia ordered the owners of Kazaa Media Desktop, Sharman Networks, of Sydney, to amend the software so that it does not allow the downloading of copyrighted music or film.
_____________
PartyGaming, the internet's leading poker site, saw its share price fall by 33% after it revealed that new customer growth and spending by players had slowed more than nticipated, worrying investors that the online gaming boom may be ending.
_________________
The EU reached a deal with China on textile imports that releases millions of garments impounded in Europe's warehouses because quotas have been filled. At a meeting in Beijing, the EU and China agreed that half the backlog could count towards next year's quota.
______________
Oil prices fell back from last week's all-time high and traded at around $65 per barrel. However, analysts feared that the damage wrought by Hurricane Katrina might mean
further price increases.
______________
America's unemployment rate fell to 4.9% in August, the lowest it has been since August 2001. However, the good news was overshadowed by a gloomy prediction from the CBO about Hurricane Katrina's impact on the labour market: 400,000 jobs may be lost by the end of the year.
SOURCE : Economist
great job buddy. i want some info abt comodity trading. can anyone help me out?
bhaumikbaxi Saysgreat job buddy. i want some info abt comodity trading. can anyone help me out?
www.ncdex.com
The History of Trading
Although the first recorded instance of futures trading occurred with rice in 17th Century Japan, there is some evidence that there may also have been rice futures traded in China as long as 6,000 years ago.
Futures trading is a natural outgrowth of the problems of maintaining a year-round supply of seasonal products like agricultural crops. In Japan, merchants stored rice in warehouses for future use. In order to raise cash, warehouse holders sold receipts against the stored rice. These were known as "rice tickets." Eventually, such rice tickets became accepted as a kind of general commercial currency. Rules came into being to standardize the trading in rice tickets. These rules were similar to the current rules of American futures trading.
In the United States, futures trading started in the grain markets in the middleof the 19th Century. The Chicago Board of Trade was established in 1848. In the 1870s and 1880s the New York Coffee, Cotton and Produce Exchanges were born. Today there are ten commodity exchanges in the United States. The largest are the Chicago Board of Trade, The Chicago Mercantile Exchange, the New York Mercantile Exchange, the New York Commodity Exchange and the New York Coffee, Sugar and Cocoa Exchange.
Worldwide there are major futures trading exchanges in over twenty countries including Canada, England, France, Singapore, Japan, Australia and New Zealand. The products traded range from agricultural staples like Corn and Wheat to Red Beans and Rubber traded in Japan.
The biggest increase in futures trading activity occurred in the 1970s when futures on financial instruments started trading in Chicago. Foreign currencies such as the Swiss Franc and the Japanese Yen were first. Also popular were interest rate instruments such as United States Treasury Bonds and T-Bills. In the 1980s futures began trading on stock market indexes such as the S&P; 500.
The various exchanges are constantly looking for new products on which to trade futures. Very few of the new markets they try survive and grow into viable trading vehicles. Some examples of less than successful markets attempted in recent years are Tiger Shrimp and Cheddar Cheese.
Futures trading is regulated by an agency of the Department of Agriculture called the Commodity Futures Trading Commission. It regulates the futures exchanges, brokerage firms, money managers and commodity advisors.
The Trading Process
Here are some typical steps in the process of making a commodity trade including the trader's decision-making process and the procedures involved in actually placing the trade.
In order to make decisions about when to trade commodity futures, you must have a source of price data. Many daily newspapers carry some commodity prices in their financial sections. The Wall Street Journal has comprehensive commodity price listings. Investor's Business Daily has both price tables and numerous price charts
All experienced commodity traders prefer to look at price activity on a chart rather than trying to interpret tables of numbers. In financial analysis, charts are indispensable for quickly grasping the essence of historical and recent price action.
The typical commodity chart depicts daily price action as a thin vertical bar which indicates the day's high and low by the top and bottom of the bar. The opening and closing prices are shown as tiny dots attached to the left and right side of the bar. A typical daily price chart can show up to six months of price action this way.
It is easy to change the bar's time frame from days to weeks or months and thus show from two to twenty years of historical price action in the same format. For short-term trading you can change the bar's time frame to hours or even minutes.
Looking at such bar charts enables a trader to see the recent trend of prices--whether up, down or sideways--in whatever time frame he chooses. Following the current trend of prices is a cornerstone of successful trading.
There are a number of ways to obtain the price charts a trader needs to analyze the markets. You can make your own using graph paper. This sounds rather primitive, but some experts recommend it as a good way to put yourself in close touch with price activity and monitor risk.
Another source of charts is the printed chart service. There are about half a dozen of these. They typically mail a booklet of numerous charts covering all the tradeable markets after the markets close on Friday. There is space on the charts to update them daily during the following week until next chart book arrives. These printed chart books normally have a number of indicators plotted along with the price action and contain a wealth of additional information.
For computer owners there are many software programs that create fancy charts on the computer screen. You can input the price data manually or, via telephone modem, download comprehensive data after the markets close for the day. Those with larger budgets can install a small satellite dish and watch price changes in all the markets nearly instantaneously as they occur. The software creates charts dynamically on the computer screen as each trade takes place on the exchanges. You can put many different charts on the screen and thus watch numerous markets all around the world in real time. The cost can range from a few hundred to $1,000 a month depending on the software and the number of exchanges you subscribe to.
It is easy to believe that computers can make a big difference in trading success. Vendors of expensive software will tell you that since other traders, who are your competition, have expensive computer setups, you need one too. This isn't really true.
Those who can't trade profitably without a computer probably won't be helped too much by using a computer. It may actually be detrimental by causing an increase in trading frequency. While a computer will not make a bad trader into good one, they are fun to use, and they do make a trader's life easier.
There are two primary analytic methods for deciding when to take a futures position: fundamental analysis and technical analysis. Fundamental analysis involves using economic data relating to supply and demand to forecast likely future price action. Technical analysis involves analyzing past price action of the market itself to forecast the likely future price action.
While there are differences of opinion about the relative merits of the two approaches, almost all successful traders emphasize technical analysis. There are a number of reasons for this. First and foremost is the difficulty of obtaining accurate fundamental data. While various governments and private companies publish statistics concerning crop sizes and demand levels, these numbers are gross estimates at best. With the current global marketplace, even if you could obtain accurate current information, it would still be impossible to predict future supply and demand with enough accuracy to make commodity trading decisions.
Technical analysts argue that since the most knowledgeable commercial participants are actively trading in the markets, the current price trend is the most accurate assessment of future supply and demand. If someone is correct that for fundamental reasons, prices will likely move up strongly in the future, the commercial participants who have the greatest knowledge and influence on the markets should certainly be moving the price upward right now. If price instead is moving down, a lot of very knowledgeable people must think price in the future will likely be down, not up.
For this reason, almost all successful speculators learn to follow price action and not try futilely to predict turning points in advance. They seek to trade in tune with the large participants who move the markets.
Continued...........
Although the first recorded instance of futures trading occurred with rice in 17th Century Japan, there is some evidence that there may also have been rice futures traded in China as long as 6,000 years ago.
Futures trading is a natural outgrowth of the problems of maintaining a year-round supply of seasonal products like agricultural crops. In Japan, merchants stored rice in warehouses for future use. In order to raise cash, warehouse holders sold receipts against the stored rice. These were known as "rice tickets." Eventually, such rice tickets became accepted as a kind of general commercial currency. Rules came into being to standardize the trading in rice tickets. These rules were similar to the current rules of American futures trading.
In the United States, futures trading started in the grain markets in the middleof the 19th Century. The Chicago Board of Trade was established in 1848. In the 1870s and 1880s the New York Coffee, Cotton and Produce Exchanges were born. Today there are ten commodity exchanges in the United States. The largest are the Chicago Board of Trade, The Chicago Mercantile Exchange, the New York Mercantile Exchange, the New York Commodity Exchange and the New York Coffee, Sugar and Cocoa Exchange.
Worldwide there are major futures trading exchanges in over twenty countries including Canada, England, France, Singapore, Japan, Australia and New Zealand. The products traded range from agricultural staples like Corn and Wheat to Red Beans and Rubber traded in Japan.
The biggest increase in futures trading activity occurred in the 1970s when futures on financial instruments started trading in Chicago. Foreign currencies such as the Swiss Franc and the Japanese Yen were first. Also popular were interest rate instruments such as United States Treasury Bonds and T-Bills. In the 1980s futures began trading on stock market indexes such as the S&P; 500.
The various exchanges are constantly looking for new products on which to trade futures. Very few of the new markets they try survive and grow into viable trading vehicles. Some examples of less than successful markets attempted in recent years are Tiger Shrimp and Cheddar Cheese.
Futures trading is regulated by an agency of the Department of Agriculture called the Commodity Futures Trading Commission. It regulates the futures exchanges, brokerage firms, money managers and commodity advisors.
The Trading Process
Here are some typical steps in the process of making a commodity trade including the trader's decision-making process and the procedures involved in actually placing the trade.
In order to make decisions about when to trade commodity futures, you must have a source of price data. Many daily newspapers carry some commodity prices in their financial sections. The Wall Street Journal has comprehensive commodity price listings. Investor's Business Daily has both price tables and numerous price charts
All experienced commodity traders prefer to look at price activity on a chart rather than trying to interpret tables of numbers. In financial analysis, charts are indispensable for quickly grasping the essence of historical and recent price action.
The typical commodity chart depicts daily price action as a thin vertical bar which indicates the day's high and low by the top and bottom of the bar. The opening and closing prices are shown as tiny dots attached to the left and right side of the bar. A typical daily price chart can show up to six months of price action this way.
It is easy to change the bar's time frame from days to weeks or months and thus show from two to twenty years of historical price action in the same format. For short-term trading you can change the bar's time frame to hours or even minutes.
Looking at such bar charts enables a trader to see the recent trend of prices--whether up, down or sideways--in whatever time frame he chooses. Following the current trend of prices is a cornerstone of successful trading.
There are a number of ways to obtain the price charts a trader needs to analyze the markets. You can make your own using graph paper. This sounds rather primitive, but some experts recommend it as a good way to put yourself in close touch with price activity and monitor risk.
Another source of charts is the printed chart service. There are about half a dozen of these. They typically mail a booklet of numerous charts covering all the tradeable markets after the markets close on Friday. There is space on the charts to update them daily during the following week until next chart book arrives. These printed chart books normally have a number of indicators plotted along with the price action and contain a wealth of additional information.
For computer owners there are many software programs that create fancy charts on the computer screen. You can input the price data manually or, via telephone modem, download comprehensive data after the markets close for the day. Those with larger budgets can install a small satellite dish and watch price changes in all the markets nearly instantaneously as they occur. The software creates charts dynamically on the computer screen as each trade takes place on the exchanges. You can put many different charts on the screen and thus watch numerous markets all around the world in real time. The cost can range from a few hundred to $1,000 a month depending on the software and the number of exchanges you subscribe to.
It is easy to believe that computers can make a big difference in trading success. Vendors of expensive software will tell you that since other traders, who are your competition, have expensive computer setups, you need one too. This isn't really true.
Those who can't trade profitably without a computer probably won't be helped too much by using a computer. It may actually be detrimental by causing an increase in trading frequency. While a computer will not make a bad trader into good one, they are fun to use, and they do make a trader's life easier.
There are two primary analytic methods for deciding when to take a futures position: fundamental analysis and technical analysis. Fundamental analysis involves using economic data relating to supply and demand to forecast likely future price action. Technical analysis involves analyzing past price action of the market itself to forecast the likely future price action.
While there are differences of opinion about the relative merits of the two approaches, almost all successful traders emphasize technical analysis. There are a number of reasons for this. First and foremost is the difficulty of obtaining accurate fundamental data. While various governments and private companies publish statistics concerning crop sizes and demand levels, these numbers are gross estimates at best. With the current global marketplace, even if you could obtain accurate current information, it would still be impossible to predict future supply and demand with enough accuracy to make commodity trading decisions.
Technical analysts argue that since the most knowledgeable commercial participants are actively trading in the markets, the current price trend is the most accurate assessment of future supply and demand. If someone is correct that for fundamental reasons, prices will likely move up strongly in the future, the commercial participants who have the greatest knowledge and influence on the markets should certainly be moving the price upward right now. If price instead is moving down, a lot of very knowledgeable people must think price in the future will likely be down, not up.
For this reason, almost all successful speculators learn to follow price action and not try futilely to predict turning points in advance. They seek to trade in tune with the large participants who move the markets.
Continued...........