World Economic News
Malaysian Minister Accuses West of 'Green Imperialism'
June 27 (EIRNS)Nor Mohamed Yakcop, currently Malaysia's second finance minister, and the primary advisor to former Prime Minister Mahathir bin Mohamad, has launched a direct hit on the imperial nature of the "global warming" promoters in regard to Malaysia's historic currency controls regime imposed in 1998.
"Companies that are polluting in China," said Nor Mohamed, speaking on June 25 at the World Economic Forum on East Asia in Singapore, "are owned by American, European, Japanese, and others. They are benefiting from the cheap labor, from the resources, and at the same time accusing China of pollution. There should be no hypocrisy. Let's take the hypocrisy out of the equation."
"This is green imperialism," he added. No one at the conference appears to have called the bluff of the "man-made global warming" hoax as a scientific fraud, however.
Another Hedge Fund Sells Assets at 50¢ on the Dollar
June 26 (EIRNS)Cheyne Capitol Management Ltd, a London-based hedge fund hit by the U.S. subprime mortgage crisis, sold off assets for only half their "assumed value." One of Cheyne's funds, Queen's Walk Investment Ltd., according to Bloomberg (June 25), had invested in the riskiest portions of bonds backed by mortgages and had lost 67.7 million euros ($91 million) in the year ending March 31. Cheyne had also held 12% of its assets in the risky U.S. subprime housing market. So, it sold off most of its mortgage backed securities, at 50%, and cut its level of debt to just 6.6 times its assets, down from its previous leverage ratio of 28.5 times. According to the London Financial Times June 26, the firm's manager said: "We have de-risked the company."
Japan Central Bank Dumps 'Weak Yen Official' Watanabe
June 26 (EIRNS)Japanese top currency official, Vice Finance Minister for International Affairs Hiroshi Watanabe, announced his intention to resign on June 25. Watanabe, known as the "Weak Yen Official," was one of the key supporters of the yen carry trade.
On June 26, Reuters reported that Japanese Finance Minister Koji Omi had issued a statement warning that investors should realize the risk of one-way bets against the yen. He told reporters in Tokyo that "disorderly moves of foreign exchange rates are undesirable." The statement was seen as targeting the yen carry trade.
China Cracks Down on 'Hot Money' Banks
June 29 (EIRNS)China's State Administration of Foreign Exchange (SAFE) has cracked down on 29 banks, domestic and foreign, accusing them of bringing "hot money" into China. "Speculative capital has flown into the country under the guise of trade and investment. The capital inflows have, to some extent, affected the domestic capital macro-economic situation and a healthy economic development," said SAFE Deputy head Deng Xianhong, as reported by the China Daily June 26.
Among the foreign banks named are the HSBC, Standard Chartered, and Citigroup. Among the domestic banks, branches of the state-owned Bank of China, the Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of Communications, and China Construction Bank have been identified to be disciplined.
According to the SAFE authorities, the speculators are targeting the Chinese currency, the yuan, which has risen by 8% since China widened its fixed trading band in July 2005. One way of getting the speculative flow into China is via short-term foreign borrowings, which went up 16% from late 2005 to late 2006. By the end of 2006, some 57% of foreign debt was short-term, up from 55.8% in June 30, 2006.
Already the amount of speculative funds in China has ballooned to $300 billion, which "will fan speculative sentiment, but once it flows out abruptly, it will deal a blow to the financial system," said Zhuang Jian, a senior economist with the Asian Development Bank.
Russia, France Approve $400 Million Nuclear Deal
June 30 (EIRNS)Russia and France have agreed on a deal to jointly produce turbines for nuclear power plants. Russia's Atomenergomash and France's Alstom signed documents yesterday to establish a $400-million joint venture to manufacture half-speed turbines for nuclear power plants in Russia and abroad.
According to details reported in RIA Novosti June 29-30, the companies reached a deal in April, which gives Russia's state controlled nuclear power corporation a 51% share in the venture, which will operate on the platform of the machine-building firm ZIO Podolsk in the Moscow Region. The future joint venture will manufacture the entire conventional array of equipment used in nuclear power plants, drawing on Alstom's "Arabelle" half-speed turbine technology. Alstom will transfer technology to the joint venture company, namely for the manufacture of its Arabelle steam turbine and generator.
The joint venture, expected to reach full capacity within three years, will benefit from the best technology available for conventional equipment for its nuclear power plants, and will have exclusive access to the fast-growing Russian nuclear power plant market. The joint venture will cover at least half of Russia's demand for nuclear power plant turbines.