Europe & China cut rates, Bank of England for QE; Modern medicine’s loss — the doc’s touch; Are we all Tom Sawyers?; Exit God, enter madness; India’s record current-account deficit

1 Europe & China cut rates, Bank of England for QE (The Guardian) Central banks around the world signalled their determination to stimulate the flagging global economy, with the injection of £50bn of electronic money into the UK and interest rate cuts in the eurozone and China. The Bank of England warned that recovery was at risk without a boost to its programme of quantitative easing after a flurry of economic surveys showed the double-dip recession could stretch into the autumn. Not since the financial crash of 2008 has the world economy appeared to be going into reverse, but a downturn in the US and key Asian economies following the euro crisis has sapped the life out of global trade.

The Bank of England’s monetary policy committee, which sets interest rate policy, said that the total amount of QE would rise to £375bn, while the base interest rate would remain at 0.5%. It said the eurozone crisis was continuing to batter business confidence, despite a deal struck last weekend that calmed market fears of a euro collapse.

2 Modern medicine’s loss — the doc’s touch (BBC) Modern medicine is in danger of losing a powerful, old-fashioned tool: human touch. Physician and writer Abraham Verghese says that in our strange new world patients are merely data points, and calls for a return to the traditional one-on-one physical exam.

Before he finished medical school, Abraham Verghese spent a year on the other end of the medical pecking order, as a hospital orderly. Moving unseen through the wards, he saw the patients with new eyes, as human beings rather than collections of illnesses. The experience has informed his work as a doctor – and as a writer. He’s now a professor for the Theory and Practice of Medicine at Stanford, where his old-fashioned weekly rounds have inspired a new initiative, the Stanford 25, teaching 25 fundamental physical exam skills and their diagnostic benefits to interns.

3 SA youth unemployment at 42% (Johannesburg Times) Data shows that about 42% of young people under the age of 30 in South Africa are unemployed. Only one in eight working age adults under the age of 25 years has a job. President Jacob Zuma alleged that local employers often continuously recruited from abroad while the country had thousands of unemployed people, including graduates. Not only were scarce or exceptional skills being recruited from outside the country but unskilled labour as well, he added.

4 Revolution and after (Barak Barfi in Khaleej Times) Egypt is not the only place where the bright hopes of the Arab Spring are fading. From attacks against Western governments to ethnic clashes in remote desert oases, Libya’s revolution is faltering. During his 42 years in power, Gaddafi surrounded himself with advisers who were companions from his youth, supplemented by a small coterie of technocrats. As a result, the leaders of the revolt that overthrew him have little government experience. And, in a country where any political activity was considered treasonous, many expected the neophyte NTC to stumble early and often. And so it has.

Many NTC members believe that the Council lacks the legitimacy to make tough choices. They argue that the NTC should limit itself to serving as a caretaker government, implementing only the most essential decisions until elected officials take office. After an eight-month revolution that devastated the country, Libyans are demanding real reforms. But, without a new leadership that is willing to implement them, it will be a long time before Libya turns a new page.

5 Are we all Tom Sawyers? (PG Bhaskar in Khaleej Times) One of my vivid recollections from Mark Twain’s book ‘The Adventures of Tom Sawyer’ is the story about young Tom who was dreading the task of whitewashing the fence. But by pretending to enjoy the task and initially hesitating to allow his friends to share the task, he manages to get the entire fence ‘outsourced’ and gets paid for it by eager boys, all dying to have a go.

In India again, a few years back, a company that manufactured mint decided to cut costs and sell its mint shaped like a ring instead of as a full circle as was conventional. That gave the consumer only about 60% of the quantity per mint, but the company splurged massively on advertisements calling it ‘the mint with a hole’. Now why that should be anything to shout about, I don’t know, but it helped to differentiate and it worked.

My wife once gave me a spiel about making coffee; about how it was an art, how much she enjoyed making it to perfection and about how I was a budding coffee connoisseur who had it in him to make the perfect coffee. I fell for it and since then have made every cup of coffee at home. Now, my wife thinks it is unfortunate that my extraordinary talent for cooking has been unutilised. But I’m smarter now and haven’t fallen for this one. Maybe there’s a bit of Tom Sawyer within each of us. We preen and promote so that we may not be the only one.

6 Exit God, enter madness (Dawn) On Wednesday, a frenzied mob broke into a police station in Bahawalpur (South Punjab). The mob’s target was a ‘malang’ (vagabond), the sort that have been found in and around numerous shrines of Sufi saints in the sub-continent for centuries. As he sat behind bars at a police lock-up and as most of the cops kept giving him sideways glances, cracking vague, pitying grins at the malang’s state of mind and habit of talking to himself, the mob surrounded the police station, demanding that the ‘blasphemer’ be handed over.

Some witnesses (the mesmerised zombies) said they could hear the malang screaming and pleading the mob for mercy. But the onlookers stood still and so did the bruised cops, praying that the promised reinforcements would arrive before the mob slaughtered the malang and send him to hell for insulting Islam – the ‘religion of peace.’ The mob had had its fill of vengeance and blood. It had battered a vagabond and mentally disturbed person to death. And as if that wasn’t enough to quench its blood thirst, it set the limp, bloodied body of the man on fire!

Deluded as we have become about our religious and national identities and priorities, I’m sure after seeing flames rise from the evil blasphemer’s dead body, many pious men in the mob must have looked at the sky, trying to penetrate their blood-shot gaze into the seventh sky where God resides, expecting the Almighty to begin showering rose petals on them. That didn’t happen, and no one was willing to suggest that in all probability God had actually been repulsed by the act.

7 Record current-account deficit for India (The Wall Street Journal) India’s current-account deficit widened to a record in the January-March period, as exports slowed and imports climbed, increasing the pressure on the country’s tenuous external position.Analysts, however, expect the combination of a weak Indian rupee and lower commodity prices to shrink the current-account gap in coming quarters.

The widest-ever current-account deficit kept India’s balance of payments in negative territory for a second consecutive quarter, forcing the Reserve Bank of India to dip into its foreign-exchange reserves. The current-account deficit in the three months through March was $21.7 billion, or 4.5% of gross domestic product, compared with $6.3 billion a year earlier, or 1.3% of GDP. It was also more than the October-December period’s $19.6 billion—the previous record.

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Why Marxism is on the rise again; UK soldiers face redundancy; India out of power; Slow economy and China’s ghost fleet; What downturn, wonder India super rich

1 Why Marxism is on the rise again (Stuart Jeffries in The Guardian) There’s a reason why Marxism has something to teach us as we struggle through economic depression, other than its analysis of class struggle. It is in its analysis of economic crisis. In his formidable new tome Less Than Nothing: Hegel and the Shadow of Dialectical Materialism, Slavoj Žižek tries to apply Marxist thought on economic crises to what we’re enduring right now. Žižek considers the fundamental class antagonism to be between “use value” and “exchange value”.

What’s the difference between the two? Each commodity has a use value, he explains, measured by its usefulness in satisfying needs and wants. The exchange value of a commodity, by contrast, is traditionally measured by the amount of labour that goes into making it. Under current capitalism, he argues, exchange value becomes autonomous. “It is transformed into a spectre of self-propelling capital which uses the productive capacities and needs of actual people only as its temporary disposable embodiment.

Marx derived his notion of economic crisis from this very gap: a crisis occurs when reality catches up with the illusory self-generating mirage of money begetting more money – this speculative madness cannot go on indefinitely, it has to explode in even more serious crises. The ultimate root of the crisis for Marx is the gap between use and exchange value: the logic of exchange-value follows its own path, its own made dance, irrespective of the real needs of real people.”

2 Three Gorges dam ready (The Guardian) The final turbine of China’s massive Three Gorges dam has been connected to the power grid, marking the completion of a controversial hydropower project that cost the country more than £38bn and displaced at least 1.3 million people. The installation of the project’s 32nd 700-megawatt unit brought total capacity up to 22.5 gigawatts (GW), accounting for 11% of the country’s total hydroelectric capacity. Britain’s largest power station, Drax, produces 4GW.

“The complete operation of all the generators makes the Three Gorges dam the world’s largest hydropower project, and the largest base for clean energy,” Zhang Cheng, general manager of the project’s operator, China Yangtze Power, told a ceremony. The construction of the world’s biggest hydropower plant began in 1994 and its first generating unit was connected to the grid in July 2003.

The official state news agency Xinhua said the dam had already generated a total of 564.8bn kilowatt-hours, saving nearly 200m tonnes of coal a year. But the project, located on the middle reaches of the Yangtze river, cost £26bn, four times the original estimate.

3 UK soldiers face redundancy (The Guardian) Thousands of soldiers could face compulsory redundancy over the next two years as the army pushes through radical reforms. With the army needing to axe 20,000 posts because of budget cuts, commanders are pushing to downsize as quickly as possible rather than prolong the process. This means the next two tranches of redundancy will be huge – and are likely to coincide with the draw-down from Afghanistan, leaving the army to start afresh in 2015.

4 India out of power (Mint) There is nothing unusual for many cities and a very large number of villages in India to be subjected to 8-12-hour power cuts these days. The situation is so dire that state governments are willing to purchase electricity at ruinous rates rather than risk a law and order situation. Haryana, for example, has been buying power at Rs 17 per unit. The situation won’t change unless there is a dramatic improvement in the supply of power or a drastic reduction in demand. India has opted for the latter option.

5 A sweat job amidst belt-tightening (The New York Times) Once stereotyped as the domain of bodybuilders and gym devotees, personal training is drawing the educated and uneducated; the young and old; men and women; the newly graduated, the recently laid-off and the long retired. From 2001 to 2011, the number of personal trainers grew by 44%, to 231,500, while the overall number of workers fell by 1%, according to the Labor Department. It is no wonder that so many Americans are trying to transform a passion for fitness into a new career.

Personal training requires many of the skills and qualities of the new typical middle-class American job: it is a personal service that cannot be automated or sent offshore, that caters to a wealthier client base and that is increasingly subsidized (in this case, by employers and insurance companies).

6 India street children bank on future (Dawn) Ram Singh, 17, earns just one dollar from the 100 cups of tea he makes every day outside Delhi railway station, but each evening, after packing up, he goes to the bank and deposits nearly half of it. Singh holds an account at a special bank, run for—and mostly by—Indian street children, that keeps what little money they have safe and seeks to instil the idea that savings, however meagre, are important. Just one among millions of street children who rely on menial jobs for survival, Singh is determined to make his work pay some sort of future dividend.

The Children’s Development Khazana (treasure chest) opened its first office in New Delhi 2001 and has since spread across the country and overseas with 300 affiliated branches in India, Nepal, Bangladesh, Afghanistan, Sri Lanka and Kyrgyzstan. Delhi counts 12 branches with around 1,000 child clients aged between nine and 17.“Children who make money by begging or selling drugs are not allowed to open an account. This bank is only for children who believe in hard work,” said Karan, a 14-year-old “manager”.

7 Slow economy and China’s ghost fleet (Straits Times) China’s huge fleet of coastal ships, usually confined to plying the Chinese seaboard, has sailed out of the shadows to seek international business in yet another sign that China’s economy is slowing. The fleet, previously unnoticed by the global market, is suffering from a slowdown in China’s coastal trade amid weaker domestic demand from utilities and steel mills and a growing glut in Chinese coal and iron ore stockpiles. The vessels are now being forced to seek new business such as in the Indonesian coal trade, dealing a further blow to the depressed global dry bulk shipping market.

8 What downturn, wonder India super rich (The Wall Street Journal) The ranks of India’s super-rich – defined by having a minimum average net worth of 250 million rupees ($5.6 million) over the past 10 years – are estimated to have grown by 30% to around 81,000 in 2011-12, according to a new study. In fact, many of them interviewed for the study gave the response that we used in the headline when asked how they were faring.

Not only are these fine folks barely feeling the effects of India’s economic slowdown, they want you to know that they are untouched, too. “One distinct facet” of such a person, the report says, “is his lifestyle and he goes to great lengths to maintain it. “Our respondents did not seem to feel that the circumstances warranted any cutbacks in spending. In fact, many of them even justified the increase in expenditure, in absolute terms, by pointing out that the number of non-discretionary items too was on the rise, to support that lifestyle.” They also want to make sure that they stay well separated, in branding terms, from the likes of you and me.

9 Malayala Manorama on hi-tech copying at the Mulakunnathukavu Medical College near Thrissur. The technique involves keeping a micro mini blue tooth speaker in the ear, and a tiny mike hidden in clothes or inside a finger ring. The mobile phone is kept outside the classroom. Once the question paper is distributed, questions can be murmured into the mike, and answers will flow in through the earpiece, from friends who refer books and pass them on. To signal for answer to the next question, a button inside the shoe can be used. The entire set costs only Rs 2,500, and senior students pass this on to juniors at seconds-sale prices. Authorities have got wind of it, and a mobile jammer has been put in place.

Columnist of the day:

MJ Akbar writing in Khaleej Times — Prime minister Manmohan Singh merely has to let time and a calendar he cannot change shape the agenda. Never forget that Dr Singh took a graduate course in politics from the Narasimha Rao University of Survival by Procrastination.

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Private banks have failed — we need a public solution; Austerity undermining Europe’s grand vision; India’s ‘child Picasso’; Flatter world shaping our future; SA’s abused husbands

1 Private banks have failed — we need a public solution (Seumas Milne in The Guardian) The greatest danger of the rate-fixing scandal now engulfing the City of London is that it will be managed and defused in the usual way, and nothing will really change. The forced resignation of Bob Diamond, the Barclays chief executive, follows well-worn procedures for dealing with crises that potentially threaten those in power: denounce the worst offenders, let a few symbolic heads roll, set up an inquiry under a safe pair of hands, and tweak the regulations to prevent a repetition of the most egregious misdemeanours.

The financial system has already failed at huge economic and social cost. It has been shown to be corrupt, incompetent, rapacious and economically destructive. The City’s claims to be an indispensable jobs and tax engine for the British economy are nonsense: the bailout costs of 2008-9 dwarfed the financial tax revenues of the boom years, which were below those of manufacturing even at their peak.
Tougher regulation or even a full separation of retail from investment banking will not be enough to shift the City into productive investment, or even prevent the kind of corrupt collusion that has now been exposed between Barclays and other banks. As a report by Manchester University’s Cresc research team argues this week, the size and complexity of the modern banking system makes it “near ungovernable”.

Only if the largest banks are broken up, the part-nationalised outfits turned into genuine public investment banks, and new socially owned and regional banks encouraged can finance be made to work for society, rather than the other way round. Private sector banking has spectacularly failed – and we need a democratic public solution.

2 Austerity undermining Europe’s grand vision (Amartya Sen in The Guardian) The dream of the unification of Europe goes back at least to the 15th century, but it is the nastiness of the world wars in the 20th century that established its urgent need in our time. It is important to appreciate that the movement for European unification began as a crusade for cross-border amity and political unity, combined with freer movement of people and goods. Giving priority to financial unification, with a common currency, came much later, and it has, to some extent, started to derail the original aspiration of European unity.

So what has gone wrong? Two issues need to be separated out: one, the counterproductive nature of the policy of austerity imposed on (or, as in Britain, chosen voluntarily by) governments; and two, a reasoned suspicion about the lack of viability of the shared euro. The moral appeal of austerity is deceptively high (“if it hurts, it must be doing some good”), but its economic ineffectiveness has been clear at least since Keynes’s debunking of “the remedy of austerity” in the Great Depression of the 1930s, with unemployment and idle capacity due to a lack of effective demand.

The problems we are seeing in Europe today are mainly the result of policy mistakes: punishments for bad sequencing (currency unity first, political unity later); for bad economic reasoning (including ignoring Keynesian economic lessons as well as neglecting the importance of public services to European people); for authoritarian decision-making; and for persistent intellectual confusion between reform and austerity. Nothing in Europe is as important today as a clear-headed recognition of what has gone so badly wrong in implementing the grand vision of a united Europe.

3 India’s ‘child Picasso’ (The Guardian) “I want to do some painting’ said the small voice underneath the dining table. “But first I want to shoot someone.” Kapow! A green foam ball pinged out from beneath the tablecloth, shortly followed by Shorya Mahanot, wielding a luminous pumpgun. Clearly pleased that he had hit one of his big sisters, Asia’s youngest abstract painter ran off to get changed.

Dubbed a “child Picasso” by the Indian media, five-year-old Shorya hit the headlines last month when India’s most famous cartoonist took him under his wing. RK Laxman, 90, welcomed the budding artist into his home in Pune, Maharashtra. He was so impressed, his father, Aditya Singh says, that he suggested the pair put on a joint exhibition in Mumbai next month. Neemuch, a dusty town in central India is best known, if at all, for its opium production and the unusually high number of locals who donate their eyes after death. But if Aditya Singh’s dream comes true, Neemuch may soon be famed as the birthplace and workplace of India’s greatest contemporary artist; a south Asian Giverny; a place as synonymous with 21st-century abstraction as New York is for pop art.

4 Flatter world shaping our future (BBC) In 2006, Thomas Friedman’s book The World is Flat portrayed a global population that was more borderless and interconnected than ever before. Since Friedman’s book, we’ve moved even further into the future, with nearly six billion connected mobile devices and two billion people on the internet. Today organisations can tap into scalable, on-demand cloud-computing resources from Amazon Web Services and Google.

This new wave of cloud services is challenging long-standing assumptions about how information should and can be shared, and how organisations should be structured. The convergence of cloud, social and mobile in emerging enterprise technologies is revolutionising how businesses share and collaborate, and radically flattening them in the process. The barriers that once existed between and within corporations are now disappearing, at an ever-increasing speed.

And in the process, entire industries are being remade. The flattening of sharing and collaboration is changing how we explore space, how digitally animated movies are rendered, how the analogue publishing industry conducts business digitally and how the world’s biggest companies leverage distributed talents to bring new products to market.

5 Manchester United seeks US listing (BBC) Manchester United has applied to list on the US stock market in a share sale aimed at raising $100m. In documents filed with the Securities and Exchange Commission, the Premier League giant said it was listing on the New York Stock Exchange. The club had earlier explored the possibility of a $1bn floatation on the Singapore stock market. United, among the best-supported clubs in the world, said it would use money from the listing to repay debt.

6 SA’s abused husbands (Johannesburg Times) Dozens of men have taken to the streets of Hillbrow, Johannesburg, to seek protection from their abusive wives, who regularly beat them up, according to a report. “We have a database of men who have been abused from all social classes, including pastors, men from informal settlements and medium-to-low density suburbs,” Moshate Men’s Right Organisation spokesman CEO Nashilo Mnisi told The New Age. The men marched under the organisation’s banner at the weekend. Mnisi said women were increasingly becoming more abusive towards men.

7 Net-addicted Arab kids (Khaleej Times) Emirati teens are trendsetters when it comes to keeping up to date with the latest technology, but that may have a downside, according to the top executive of a marketing research company citing a survey. Gagan Bhalla, CEO of AMRB, — which in part conducted the survey — said while Emirati teens have the latest smartphones and computers, these same diversions are preventing them from focusing on hitting the books.

Fuelling their tech-savvy lifestyle is the fact Emirati teens get four times more pocket money than their global counterparts, Bhalla said. “Here they spend Dh400 a week compared to Dh130 for teens across the globe,” he said. Emirati teen Ali Omran says he believes spending time online can be useful. The 15-year-old is a self-professed Twitter addict and spends nearly seven hours a day on his computer, compared to the one-to-two hours spent online by the teens surveyed. He also owns two phones, a Nokia and a BlackBerry.

8 India’s currency reserves are smaller than they seem (The Wall Street Journal) India officially has $286 billion in official foreign currency reserves, but its usable amount is less than that, according to an analysis by Deutsche Bank economists, Taimur Baig and Kaushik Das. The amount of reserves matters for India because the Reserve Bank of India has been using those reserves to intervene in currency markets to buoy the sinking rupee, which has fallen 18% in the past year. The bigger the reserves war chest, the more confidence investors will have that the bank can fight off a speculative attack on the currency.

Of the $286 billion official figure, Deutsche Bank notes that around $253 billion are “usable reserves” — meaning the RBI can tap them at short notice. The balance is held as $2.8 billion in US dollars at the IMF, $4.4 billion in the form of “special drawing rights” a quasi currency used by the IMF, and $25.6 billion as gold.

This, however, is “not the complete picture,” the economists note. India reports to the IMF other liabilities in the form of derivatives bets the RBI has made in the currency forwards and futures markets. This category has risen dramatically in recent months as the RBI has dipped into financial markets to support the falling rupee. Playing in forwards and futures can be an easier way for the RBI to affect the actual spot level of a currency that most people watch.

The total amount of these derivatives bets was as much as $14.2 billion as of May. Deutsche Bank subtracts that $14.2 billion from the “usable” $253 billion and that leaves India with about $239 billion. The smaller actual reserves “don’t raise alarm bells,” according to Deutsche Bank, as it’s still equal to about six months of India’s imports. This number could become important if the rupee resumes its slide.

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Microsoft suffers for ad dud; GlaxoSmithKline fined $3bn for healthcare ‘fraud’; Euro gloom crosses Atlantic; Energy shortage hits India

1 Microsoft suffers for ad dud (San Francisco Chronicle) Microsoft is absorbing a $6.2 billion charge to reflect that one of the biggest deals in its 37-year history turned out to be a dud. The non-cash charge could saddle Microsoft Corp. with a loss for its fiscal fourth quarter ended in June. Analysts had predicted Microsoft would earn about $5.3 billion for the period. The company hasn’t suffered a quarterly loss during the past 20 years, according to its website. The world’s largest software maker blamed the setback on the disappointing performance of aQuantive. That’s an online advertising service that Microsoft bought for $6.3 billion in 2007 to mount a more serious challenge to one of its biggest rivals, Internet search leader Google.

The aQuantive deal ranked as the most expensive deal in Microsoft’s history until it was eclipsed last year by the company’s $8.5 billion purchase of Internet video chat service Skype. Investors can only hope Skype works out better than aQuantive. Microsoft’s $6.2 billion charge represents a sobering acknowledgement that aQuantive didn’t bring in as much online advertising revenue as envisioned, forcing management to write off most of the purchase price.

To add to Microsoft’s mortification, Google has been milking the acquisition of an aQuantive rival to widen its lead in the steadily growing online ad market. Google bought DoubleClick for $3.2 billion about eight months after Microsoft took control of aQuantive. Since then, Google’s annual profit and advertising sales have more than doubled. Last year, Google earned $9.7 billion and collected $36.5 billion in ad revenue.

2 GlaxoSmithKline fined $3bn in healthcare ‘fraud’ (The Guardian) GlaxoSmithKline has agreed to plead guilty to misdemeanour criminal charges and pay $3bn to settle what government officials describe as the largest case of healthcare fraud in US history. The agreement, which still needs court approval, would resolve allegations that the British drug maker broke US laws in the marketing and development of pharmaceuticals. GSK targeted the antidepressant Paxil at patients under age 18 when it was approved only for adults, and promoted the drug Wellbutrin for uses it was not approved for, including weight loss and treatment of sexual dysfunction, according to a US justice department investigation.

The company went to extreme lengths to promote the drugs, such as distributing a misleading medical journal article and providing doctors with meals and spa treatments that amounted to illegal kickbacks, prosecutors said. In a third case, GSK failed to give the US Food and Drug Administration safety data about its diabetes drug Avandia, in violation of US law, prosecutors said.

3 Euro gloom crosses Altantic (The Guardian) US factories saw their biggest one-month drop in orders last month since the 9/11 terrorist attacks as the effects from Europe’s sovereign debt crisis rippled across the Atlantic. Amid growing evidence that the battle to save the euro is now having a global impact, a key monthly snapshot of business in America showed manufacturing sliding into recession territory for the first time in three years. Shares fell on Wall Street after traders were taken aback by a gloomy report from the Institute for Supply Management in the US, which followed downbeat news earlier in the day from China and the UK as well as the 17-nation eurozone. Oil prices also fell back sharply, losing almost $2 a barrel amid concerns that weaker growth across the world economy would hit demand for energy.

4 Energy shortage hits India (The Wall Street Journal) India is facing an energy crisis that is slowing economic growth in the world’s largest democracy. At stake is India’s ability to bring electricity to 400 million rural residents—a third of the population—as well as keep the lights on at corporate office towers and provide enough fuel for 1.5 million new vehicles added to the roads each month. Shortages of coal, oil and natural gas will require India to import increasing amounts of high-cost fossil fuels, risking inflation and putting the country in stepped-up competition with China, Japan and South Korea. Buying oil from Iran, one of India’s biggest suppliers, is tougher because of US and European sanctions aimed at curbing Tehran’s nuclear ambitions.

Expensive imports have taken a toll on the nation’s finances. Though global crude oil prices have eased in the past few months, India is seeing little benefit because its currency, the rupee, has been dropping against the dollar, the currency used to price oil. “The prime minister and a few wise men are beginning to realize that there’s a very bleak outlook in terms of energy security, and that this is going to create the single largest constraint on the economy, one of alarming proportions,” said Gokul Chaudhri, a partner at New Delhi-based consultancy BMR Advisors, whose clients include Indian and foreign energy firms.

5 Salam’s pocket cartoon in The Economic Times, showing an employee asking a human resource development official: Sir, can I talk to you as a human being…?

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A parched earth; No innocent bystanders in global era; RIM posts loss, to shed 5,000 jobs; America’s new Tiger immigrants

1 A parched earth (Khaleej Times) The summer of 2012 is turning out to be one of the worst in living memory for millions of people in the northern hemisphere, as a devastating drought ravages across thousands of hectares of farmland from the Korean peninsula in the east through China and India and on to the US Midwest. Comparisons are already being drawn to the drought of 1988 when nearly $80 billion worth of crops were lost following the failure of the rains in America. Nearly a quarter of the United States is facing drought conditions and corn prices have soared by almost 30%. The fact that the drought is affecting vast swathes of land in three of the world’s most significant economies — the US, China and India — which are also leading producers of agricultural crops means that there could be an acute shortage of food and a spurt in food prices.

North Korea, facing its worst drought in 50 years, is already posing a major challenge for the global community with a looming food shortage threatening millions. In China, more than 4.25 million people — and an equally large number of livestock — are suffering from a shortage of drinking water in half a dozen provinces. The south-west monsoon, the lifeblood of India’s agriculture economy — which provides livelihood to 700 million people — has seen a disastrous start.

Is drought 2012 a prelude to an ominous era of water scarcity caused by global warming, as some might insist? Climate patterns have been known to change dramatically over the centuries and droughts and famines have been with us for thousands of years, destroying communities and nations. Governments though must harness technology to provide solace to the millions suffering from such harsh climatic upheavals.

2 No innocent bystanders in global era (Stephen S Raoch in The Guardian) Since the second quarter of 2009, US annualised real GDP growth has averaged 2.4%. With roughly 40% of that increase attributable to exports, that means the remainder of the economy has grown at an anemic 1.4% pace. Under a flat-line export scenario, with no rise in US exports, and if everything else remains the same (always a heroic assumption), overall real GDP growth would converge on that 1.4% bogey. That is a weak growth trajectory by any standard – likely to result in rising unemployment and further deterioration in consumer confidence.

It underscores one of the more obvious, yet overlooked, implications of an increasingly interdependent world: we are all in it together. The euro crisis is a serious shock and is producing ripple effects around the world. Europe is export-led China’s largest source of external demand; as China goes, so goes the rest of China-centric Asia; and, from there, the ripples reach the shores of an increasingly export-dependent US economy.

In an era of globalisation, there are no innocent bystanders. There are certainly no oases of prosperity in the face of yet another major shock in the global economy. America’s growth mirage is an important case in point.

3 RIM posts loss, to shed 5,000 jobs (San Francisco Chronicle) Research In Motion delayed the BlackBerry 10 phone release, announced plans to cut 5,000 jobs and posted a quarterly loss that was five times bigger than anticipated. The stock plunged 22% after the company reported a first-quarter loss of 37 cents per share, excluding some items. RIM stock had already lost more than two-thirds of its value in the past 12 months and had fallen almost 95% from its sto ck market peak in mid-2008, cutting its market value to $4.79 billion.

4 America’s new Tiger immigrants (The Wall Street Journal) No Country on earth is in the same league as the US when it comes to the quantity of immigrants who have come here and the quality of their contributions. But lately, Americans have been questioning the benefits of immigration. Many worry that today’s immigrants differ from those of the past: less ambitious, less skilled, less willing and able to assimilate. A  report released this month by the Pew Research Center shows just how much the face of immigration has changed in the past few years. Since 2008, more newcomers to the U.S. have been Asian than Hispanic (in 2010, it was 36% of the total, versus 31%). Today’s typical immigrant is not only more likely to speak English and have a college education, but also to have come to the US legally, with a job already in place.

There also seems to be some truth in the “Tiger Mom” syndrome described by author Amy Chua. While 39% of Asian-Americans say their group puts “too much” pressure on kids to succeed in school, 60% of Asian-Americans think that other Americans don’t push their kids hard enough. The hard work and strong family values appear to pay off: Asian-Americans’ median household income is $66,000 (national median: $49,800) and their median household wealth is $83,500 (national median: $68,529). The world’s best, the world’s hardest-working and the world’s most ambitious are still coming our way.

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Koreas face big drought; More banks face rigging probe; Young Indians in death wish; Google as gadget maker

    1 Koreas face big drought (San Francisco Chronicle) North Korea dispatched soldiers to pour buckets of water on parched fields, and South Korean officials scrambled to save a rare mollusk threatened by the heat as the worst dry spell in a century gripped the Korean peninsula. Parts of North Korea are experiencing the most severe drought since record keeping began nearly 105 years ago, meteorological officials in Pyongyang, North Korea, and Seoul said.

    The protracted drought is heightening worries about North Korea’s ability to feed its people. Two-thirds of North Korea’s 24 million people faced chronic food shortages, the United Nations said earlier this month while asking donors for $198 million in humanitarian aid for the country. Even in South P’yongan and North and South Hwanghae provinces, which are traditionally North Korea’s breadbasket, thousands of acres of crops are withering away despite good irrigation systems, local officials said.

    Nearly 28,000 South Koreans, including soldiers and local residents, have been mobilized to help water rice paddies and farm fields and more than 13,000 water pumps have been provided to drought-stricken areas, the Ministry for Food, Agriculture, Forestry and Fisheries said. Officials blamed high atmospheric pressure over the Korean peninsula for the drought.

    2 More banks face interest rigging probe (BBC) A number of banks are being investigated and could face sanctions after Barclays was fined $450m for trying to manipulate interest rates at which banks lend to each other. Regulators in Europe, the US and Asia have said that investigations into other banks are “ongoing”. The UK’s Financial Services Authority said the early signs were that Barclays had not been the only firm involved. Other big names believed to be under investigation include Citigroup, JP Morgan, Deutsche Bank, HSBC and Royal Bank of Scotland.

    3 Young Indians in death wish (Soutik Biswas on BBC) A study published in the medical journal The Lancet shows that suicide has become the second leading cause of death among India’s young adults, after road accidents in men, and childbirth-related complications in women. There were 187,000 deaths from suicides in India in 2010, the study says – this is higher than the official figure of 134,599 suicide deaths from the National Crime Records Bureau. (Researchers attribute this gap to under-reporting or misreporting as friendly or bribe-seeking coroners often sign off suicide deaths as ones caused by accidents to protect the victim’s family from police harassment and social stigma.)

    If the findings by a team of doctors are to be believed, 40% of the men and 56% of the women who took their lives in 2010 were aged between 15 and 29 years. I asked Dr Vikram Patel, a leading Goa-based psychiatrist and professor at the London School of Hygience and Tropical Medicine, who co-authored the study, about why he thought this was happening. He believes that joblessness for men and post-marriage problems for women trigger off a lot of these suicides. “In women it manifests in depression, in men it becomes a drinking problem,” he says.

    India is a society steeped in the patriarchal tradition, where most women are still expected to stay at home, and bring up children. But more and more women are stepping out to work and aspiring to be independent and successful. But pressures of family, demands for dowry and domestic harassment – and violence – push many such young, married women over the edge in the country’s teeming cities and towns.
    “This is what I call the aspirational reality gap,” says Dr Patel. “Exposure to global media, education doesn’t match up to the realities at home. A touch of anomie worsens matters. Suicide is seen as a potential way out of it.” Perhaps not surprising in a society which lives with one foot in tradition, and the other in modernity.

    4 Google as gadget maker (The Wall Street Journal) Google stepped up its campaign to become a major player in consumer electronics, topped by a $199 tablet computer that could pressure Amazon while adding yet another challenger to market leader Apple. The company unveiled the tablet at a developer conference alongside other hardware it designed for the first time—a $299 home-entertainment player called Nexus Q and futuristic eyewear dubbed Google Glass that embeds a computer display in a glasses-like device.

    For Google, the transition to hardware has become necessary as Apple continues to encroach on the
    Internet-search giant’s territory with major software applications. Earlier this month, Apple touted a number of new software products, including a mapping service that would replace Google Maps as the default system for Apple devices. Like Amazon’s Kindle Fire, the Google’s tablet boasts a seven-inch screen, a $199 price and is designed to be used with content delivered from the Web—in this case digital books, music and other media available through Google’s Play service.

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Bank of England fears worse for UK; News Corp may sever publishing arm; Extreme poverty gives SA Prez sleepless nights

1 Bank of England fears worse for UK (The Guardian) A sharp deterioration in the outlook for the global economy over the last six weeks provoked Bank of England governor Mervyn King to back an extra £50bn of quantitative easing, MPs heard on Tuesday, adding to the gloom surrounding the UK’s prospects for recovery. King said the spillover effects of the eurozone crisis in Asia and the US had forced him to rethink his view on the financial crisis and vote for more QE. “What has particularly concerned me in the last several months – why I have voted for more easing policy – was my concern about the worsening I see in the position in Asia and other emerging markets,” King said. “And my colleagues in the United States are more concerned than they were at the beginning of the year about what is happening to the American economy,” he added.

The world was not half-way through a deep crisis and the eurozone turmoil was creating enormous uncertainty, leaving Britain at risk of a downward spiral if businesses postponed investment, he told the all-party Treasury select committee. “We are in the middle of a deep crisis, with enormous challenges to put our own banking system right and challenges for the rest of the world that they are struggling with,” King the committee. “I am pessimistic [about the eurozone outlook]. I am particularly concerned because over two years now we have seen the situation in the euro area get worse and the problem being pushed down the road,” he said.

2 News Corp may sever publishing arm (The New York Times) After years of defending its financially underperforming newspapers, News Corporation is now in talks to break up the company and sever its publishing assets, like The Wall Street Journal, The Times of London and The New York Post, from its lucrative entertainment units. The possibility signals a sharp reversal in the thinking of Rupert Murdoch about his $53 billion media conglomerate. For years, investors and senior News Corporation executives have pressed for a spinoff of the newspapers, but Mr. Murdoch, a newspaperman at heart who built his company from a single paper in Adelaide, Australia, has consistently rejected those proposals.

3 Extreme poverty gives SA president sleepless nights (Johannesburg Times) South Africa has reached boiling point and needs radical policy changes to quell the rising anger of ordinary citizens. Explaining his backing of the hotly debated “second transition” policy proposal, President Jacob Zuma said the ANC could no longer sit back and watch its people live in squalor. Zuma, now three years in office, confessed to sleepless nights after seeing extreme poverty. But, he warned, South Africa could not afford to be a country of “social grants”. Zuma said South Africa needed solutions to rising poverty and unemployment.

“I have paid visits to a number of areas where you can’t believe that you are in South Africa. Why should I see that as the president of the country, not even of the ANC, and think that I could sleep peacefully when I know there are people who live in things you can’t even describe as a house? It’s a very serious matter. If I didn’t know, or if I had forgotten [why I joined the struggle and fought to liberate people of this country], then I could sleep peacefully. I can’t,” he said.

4 Globe cartoon on Rio+20 summit: One participant — “If we don’t act, can you imagine the horror 20 years from now?” Responds another — “Yeah, another summit!”

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