Tuesday, 13 January 2009
In my November 2008 column, I mentioned that at the IMF meetings I had overheard Vikram Pandit sounding very upbeat. "I wonder if Pandit is an extremely optimistic person or in a cocoon of senior management denial?" I wrote.
Subsequently, an interesting Citi document crossed my desk entitled "Town Hall –Podium copy speaking notes". These were the notes for a speech that Vikram Pandit gave to employees on Monday, November 17 2008. "Exactly one week ago, our company’s leadership group got together to take stock of your accomplishments in 2008," the document starts. "We walked away with a clear sense that we are entering 2009 in
a strong position, much stronger than we entered 2008... Everyone walked away enthusiastic."
Later in the speech Pandit claims: "We have spent the last year ‘getting fit’... and are in a strong competitive position... We will be the long-term winner in this industry." There then follows a homily on banking that would make even a five-year old child cringe: "As I said, we are a bank. What does a bank do? A bank takes deposits and puts them to work..." And Citi’s chief concluded with a flourish: "Let’s show the world what we can do!" One week later, Citi was
effectively bailed out by the US Treasury after a 70% drop in its share price during the month of November.
Perhaps "cocoon of senior management denial" was an understatement.
According to this morning’s Vedomosti, Russia will create a special state
corporation to manage its financial assets. The latter could include the two
components of the former Stabilization Fund (the National Wealth Fund and
Reserve Fund), pension savings and state debt. Therefore, the amount of
assets under management by the new corporation could be as high as R7 trln
We believe the establishment of this new entity will provide more flexibility in
managing state assets. It will likely give the government more tools to support
the economy in the current difficult environment. However, given the expected
budget deficit for 2009 of around 5% of GDP, the creation of the new
corporation may also mean that state resources to finance growth after 2010
will be very limited.
Alfa Bank morning briefing 13 January, 2009
Those of us born in western Europe or the US have never really experienced hard times. Our parents and grandparents lived through world wars and the Great Depression. We have had decades of peace and prosperity.
Could that change? Perhaps Generation L has just had the luxury of an extended “holiday from history”, which is now coming to an end.
Mr Heilberg is a former Wall Street banker whose private investment company, Jarch Capital, counts former CIA, State department and Pentagon officials on its board. He may be no Rhodes – his recent forays into Africa have yet to bear much fruit and include an acrimonious dispute over claims to an oil concession in south Sudan. His latest venture does, though, have a decidedly 19th-century flavour to it.
The order is part of a set of mandatory economic, social and political guidelines the top leader set for populist president Mahmoud Ahmadi-Nejad to be included in the country’s next five-year development plan which runs from 2010 to 2015.
The government is drafting the new plan and is expected to present it to the parliament in spring for final approval.
Never before had the Dubai government opened up its books to this extent. Saturday provided another example of the government’s transparency drive, which is likely to develop further if the emirate is to receive a sovereign rating as planned this year.
Nasser Al Shaikh, director-general of the Dubai government’s finance department, outlined details of a Dh4.2bn ($1.2bn) deficit – the emirate’s first acknowledged budget deficit at 1.3 per cent of gross domestic product.
I was informed by my neighbour at the dinner table, the elegant Cyba Audi of Arabiya television, who was also playing master of ceremonies for the night, that these four melodic starlets normally get out of bed only for royalty.
The licence includes exclusive rights to use the new high-speed 3G standard; it is likely that Etisalat will invest at least US$1bn (Dh3.67bn) in developing a national network.
The new investment will mean Etisalat has a presence to the four largest economies in the Middle East– Saudi Arabia, Iran, the Emirates and Egypt.
The occupancy rate for hotel beds declined to 75.2 per cent from 83.1 per cent a year earlier, the data showed, while the number of guest-nights in hotels dropped 3.5 per cent.
Only 197.77 million shares, valued at Dh308.08 million, changed hands on the Dubai Financial Market exchange. The DFM General Index moved up 1.23 per cent to close at 1,757.02.
The real estate index, led by Emaar Properties, Arabtec, Union Properties, rose 3.01 per cent. Emaar advanced 2.90 per cent to Dh2.48; Arabtec was up 4.66 per cent to end at Dh2.02. Union Properties increased 3.85 per cent to Dh0.85. Air Arabia gained 3.26 per cent to end at Dh0.95 and Dubai Financial Market company advanced 4.51 per cent to close at Dh1.39.