Archive for the ‘Events’ Category

I am trying to extend my last post on the strengths and weaknesses of Obama nd McCain with theirt standings on the different topics:

Abortion: http://elections.nytimes.com/2008/president/issues/abortion.html

Climate Change: http://elections.nytimes.com/2008/president/issues/climate.html

Economy/Taxes: http://elections.nytimes.com/2008/president/issues/economy.html

Energy: http://elections.nytimes.com/2008/president/issues/energy.html

Healthcare: http://elections.nytimes.com/2008/president/issues/health.html

Housing: http://elections.nytimes.com/2008/president/issues/housing.html

Immigration: http://elections.nytimes.com/2008/president/issues/immigration.html

Iran: http://elections.nytimes.com/2008/president/issues/iran.html

Iraq: http://elections.nytimes.com/2008/president/issues/iraq.html

Judges: http://elections.nytimes.com/2008/president/issues/judges.html


Courtesy: New York Times

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Here is a good comparison of Joe Biden and Sarah Palin on their stands on the most-talked and important issues of USA:



Courtesy: New York Times.

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Well, now that the set is set for the final two months countdown for the much-awaited US Presidential Elections. Now, both Republicans and Democrats ready with their Presidential and Vice-Presidential Candidates, the stage is set for the ultimate battle.

Earlier last week, Obama accepted his candidacy for the Presidential Post. His speech was basically target to “CHANGE”. No doubt, with the current economic conditions CHANGE is the only thing that can keep the mighty  United States of America as the undisputed champions. All his policies seem to be on the correct path with the democratic touch of its ideologies. It was a historic moment for America, as the first black american, who moved to USA at the age of around 6  with his family looking for better prospects, is today running for the most powerful position of the world.

One week later, after the Hurricane Gustav spared the Mexican Gulfs, McCain humbly accepted the candidacy on behalf of the Republican Party. Earlier, McCain gave the most surprised package of the Presidential Election campaign by nominating the Lady Governor of Alska, Sarah Palin, as his running mate for the Vice-Presidential post. Clearly, it was the sign to woo the supporters of Hillary Clinton, especially the female ones. Moreover, Alaska, being one of the oil-rich states of America, can try to help to make the people believe that their energy concerns can be better taken care of, at least till the alternatives clean energy resources develop to a major extent to remove the complete dependence on the Gulf and middle-east countries. The another surprise was the tone of the speech give by McCain, who took few words from the Democrats by saying that he represents the PEOPLE of United States and not any individual or any party.

I feel, the contest is going to be really interesting this time. Let me put some points for each of them.

1. Presidential Path: Amazing to see Obama beating Hillary Clinton, who was termed as the next likely President. (Obama); Was always the front contender. (McCain)

2. Energy: Giving priorites to clean-fuel. (Obama); For the first time, McCain favored clean technology apart from drilling. (McCain)

3. Running Mates: Biden is Experienced and young. (Obama); Sarah Palin is a Lady, from Alaska, young and smart.

4. Economic Policies: Cut taxes, create job at USA and against outsourcing. (Obama); Cut taxes but not against outsourcing. (McCain)

5. Age factor: Young and raring to take challenges. (Obama); Experienced but very old. (McCain)

6. Health benefits: More tight controlled and monitored. (Obama); Private but hassle-free. (McCain)

7. Schools: Public-monitored. (Obama); Parent-oriented. (McCain).

8. Others: First minority presidential candidate. (Obama); Served the USA in military. (McCain)

9. Iraq and War Against Terrorism: End to Iraq war and bring Laden to terms. (Obama); No strict deadline proposals yet. (McCain)

10. Technology: Strongly in favor of development and research. (Obama); Bit hesitant to its use. (McCain) 

11. Physical Status: Young, energetic and perfectly fit. (Obama); Old, war-torn, sometimes showing a bit of imbalance with opposite views on the same topics. (McCain)

These are just a few to just bring a picture in front but I expect to see more of them getting clearer and clearer once we start watching coming both of them face-face for more debates.

Well, with Indian Parliamentary Elections scheduled next year, I assure you all to bring a sharp critical analysis of the whole process with that of the current USA elections, so that the voters of India could make more intelligent decisions.

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Here is th elist of the world’s top 10 companies and trust me, one day they are all going to look for me and then I am going to have the final say….

1. HSBC Holdings

“We have a clear strategy, it is focused on investing and developing our powerful emerging markets franchises. We will continue to do that,” Stephen Green, chairman, HSBC.

The ‘world’s local bank’ is HSBC’s tag line. Headquartered in London, HSBC is one of the largest banking and financial services organizations in the world. It comprises of over 10,000 offices in 83 countries across Europe, the Asia-Pacific region, the Americas, the Middle East and Africa. HSBC is listed on the London, Hong Kong, New York, Paris and Bermuda stock exchanges.

Shares in HSBC Holdings plc are held by around 200,000 shareholders. HSBC offers a range of financial services: personal financial services, commercial banking, corporate, investment banking and markets and private banking. HSBC Holdings has reported sales to the tune of $146.50 billion and profits of $19.13 billion in 2007.

History: The HSBC Group is named after its founding member, The Hong Kong and Shanghai Banking Corporation Limited, which was established in 1865 to finance the growing trade between Europe, India and China. The inspiration behind the founding of the bank was Thomas Sutherland, who was then working for the Peninsular and Oriental Steam Navigation Company. Seeing the potential of local banking facilities in Hong Kong and on the China coast and he helped to establish the bank which opened in Hong Kong in March 1865 and in Shanghai a month later.

2. General Electric

“We are going to solve tough customer and global problems and make money solving it,” Jeff Immelt, CEO, GE.

Imagination at work, says the GE tag line. Innovation and research are the strongholds of GE. In 1969, Neil Armstrong landed on the moon wearing boots made of GE’s silicone rubber. GE has four strong businesses in the financial services, infrastructure, and media markets.

GE Capital offers an astonishing array of products and services aimed at enabling commercial businesses and consumers worldwide. The company prides helps build the health care, transportation, and technology infrastructure across the globe. General Electric’s sales stand at $172.74 billion and profits at $22.21 billion in 2007.

History of research

GE’s research started in a barn in 1900 when General Electric Company completed eight years. The barn saw company’s major breakthrough technologies. One of the earliest projects of the new lab was incandescent lighting. GE scientists have thousands of patents, and two Nobel prizes: Irving Langmuir won the Nobel prize in Chemistry in 1932 and Ivar Giaever won the Nobel Prize in Physics in 1973.

3. Bank of America

“Bank of America helps build strong communities by creating opportunities for people – including customers, shareholders and associates – to fulfill their dreams.” Kenneth D. Lewis, chairman, CEO and president.

Bank of America is the largest commercial bank in the United States in terms of deposits and second largest by market capitalization. The bank also offers talking ATMs which help customers who are visually impaired. The Bank of America sales is at $119.9 billion and profits are at 14.98 billion in 2007.


Before 1998, Bank of America organization was known as NationsBank. In 1998, NationsBank acquired San Francisco-based BankAmerica and renamed the corporation “Bank of America”.

4. JPMorgan Chase

“Our expectation is for the economic environment to continue to be weak � in spite of the environment, we are confident that we are building an increasingly strong and profitable company.” James Dimon

JPMorgan Chase is a leading global financial services firm with assets of $1.8 trillion. With an employee strength of 1,80,000, the company operates in more than 60 countries.

It is a leading player in investment banking, financial services for consumers, small business and commercial banking, financial transaction processing, asset management and private equity. JPMorgan Chase reported sales to the tune of $116.35 billion and profits stood at $15.37 billion in 2007. Jamie Dimon is the CEO of JPMorgan Chase.


JPMorgan Chase & Co., was founded in New York in 1799. The firm is built on the foundation of nearly 1,000 institutions that have come together over the years to form todays company. JPMorgan Chase traces its beginnings to the Bank of The Manhattan Company, which was founded by Aaron Burr in 1799 and became one of the leading banking institutions in the nation.

In the 1800s, many new banks were formed across America. JPMorgan Chase has links to many of these early institutions, including the Western Reserve Bank, one of the first banks in Ohio and a predecessor of Bank One, which merged with JPMorgan Chase in 2004.

5. ExxonMobil

Exxon Mobil Corporation is an American oil and gas corporation and a descendant of John D. Rockefeller’s Standard Oil company. The company was formed on November 31, 1999, by the merger of Exxon and Mobil.

It is also the largest publicly held corporation by market capitalization, at $501.17 billion on April 18, 2008. Exxon’s reserves were 72 billion oil-equivalent barrels at the end of 2007 and are expected to last over 14 years.

While it is the largest of the six oil giants with daily production of 4.18 million BOE (barrels of oil equivalent) in 2007, ExxonMobil is 14th in the world when ranked by held oil and gas reserves. Rex W. Tillerson is the chairman and CEO of ExxonMobil. ExxonMobil reported sales to the tune of $358.60 billion and profits stood at $40.61 billion in 2007.


Exxon Mobil Corporation was formed in 1999 by the merger of two major oil companies, Exxon and Mobil. Both Exxon and Mobil were descendants of the John D. Rockefeller corporation, Standard Oil which was established in 1870.

In 1911, the Supreme Court of the United States ruled that Standard Oil must be dissolved and split into 34 companies. Two of these companies were Jersey Standard (Standard Oil Company of New Jersey), which eventually became Exxon, and Socony (Standard Oil Company of New York), which eventually became Mobil.

6. Royal Dutch Shell

“This is a very exciting – though daunting – time for our industry. The world is racing ahead with ever-increasing energy needs. We are under pressure to keep up. But this race does not have only one winner. This is a race all of us must win.” Linda Cook, Executive Director of Royal Dutch Shell.

Royal Dutch Shell is an MNC oil company with Dutch and British origins. It is the second largest private sector energy corporation in the world, and one of the six oil super majors. The company’s headquarters are in The Hague, Netherlands, with its registered office in London (Shell Centre).

Oil giant Shell has over 10 billion barrels of oil equivalent (boe) resources under construction. Shell has been exploring and producing oil and gas for more than a century.

The exploration and production work is going on in nearly 40 countries and the company employs around 35,000 people. Royal Dutch Shell reported sales to the tune of $355.78 billion and profits stood at $31.33 billion in 2007.


The Royal Dutch/Shell Group of companies was created in February 1907 when the Royal Dutch Petroleum Company and the “Shell” Transport and Trading Company Ltd of the United Kingdom merged their operations.

After the merger, 60 per cent of the new Group went to the Dutch arm and 40 per cent to the British. In 1833, the company founder’s father, Marcus Samuel, founded an import business to sell seashells to collectors in London.

When collecting seashell specimens in the Caspian Sea area in 1892, Samuel realised the potential of exporting oil from the region and commissioned the world’s first purpose-built oil tanker, the Murex to foray into this market.

7. BP

BP has transformed itself from a local oil company into a global energy group employing over 96,000 people and operating in over 100 countries worldwide. BP has reported sales to the tune of $281.03 billion and profits stood at $20.60 billion in 2007.

Tony Hayward is the group chief executive of BP, earlier known as British Petroleum. With headquarters in London, the company is among the largest private sector energy corporations in the world.


British Petroleum merged with Amoco (formerly Standard Oil of Indiana) in December 1998, becoming BPAmoco until 2000 when it was renamed BP and adopted the tagline ‘Beyond Petroleum’. Most Amoco gas stations in the United States have changed the look and name to the BP brand. The highest grade of BP gasoline available in the United States is still called Amoco Ultimate.

8. Toyota Motor Co

Toyota Motors is 70-years old. Headquartered in Japan, it is one of the world’s largest automobile manufacturers. The company was founded in 1937 by Kiichiro Toyoda as a spin off from his father’s company Toyota Industries to manufacture automobiles.

Fujio Cho, is the chairman of the company. Toyota also owns and operates Lexus and Scion brands. Toyota’s management philosophy is ‘lean manufacturing’ and ‘just in time production’. Toyota continues to promote localization, based on the principle of producing vehicles in those countries or regions where demand exists.

In Japan, Toyota has equipped Takaoka plant with the company’s most-advanced technologies. In R&D, Toyota is continuing to focus its efforts in the three key areas of the environment, safety and energy. Toyota has positioned hybrid technologies as core technologies that can contribute to resolving environmental issues. Toyota Motor Co reported sales to the tune of $203.80 billion and profits stood at $13.99 billion in 2007.


Sakichi Toyoda invented the wooden Toyoda handloom in 1890. In 1894, Kiichiro Toyoda born. In 1924, Sakichi Toyoda completed the non-stop shuttle change type Toyoda automatic loom (Type G). In 1929, Kiichiro Toyoda traveled to Europe and the United States to investigate automobiles. The British company, Platt Brothers, gained the automatic loom patent rights. In 1931, Kiichiro Toyoda started research into gasoline-powered engines.

9. ING Group

ING is a global financial services company providing banking, investments, life insurance and retirement services. The company serves more than 75 million customers in Europe, the United States, Canada, Latin America, Asia and Australia.

Based on market capitalization (31 March 2008), ING is one of the 20 largest financial institutions worldwide. The ING Group reported sales to the tune of $197.93 billion and profits stood at $12.65 billion in 2007. The group is led by Michel Tilmant.


ING was founded in 1991 by a merger between Nationale-Nederlanden and NMB Postbank Group. During the past 15 years ING has become a multinational with very diverse international activities. ING’s history can be traced to the insurers De Nationale Levensverzekering Bank and De Nederlanden van in 1845. The oldest legal predecessor is the Kooger Doodenbos from Koog, Noord Holland, founded in 1743.

10. Berkshire Hathaway

“When a management team with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact. ” Warren Buffett

Warren Buffet’s Berkshire Hathaway is based in Omaha, US. Berkshire Hathaway manages a number of subsidiary companies. Its core business is insurance, including property and casualty insurance, reinsurance and specialty nonstandard insurance.

The company averaged an annual return in excess of 21 per cent to its shareholders for the last 42 years while employing large amounts of capital and minimal debt. Warren Buffett is the company’s chairman and CEO. Earlier, he used to focus on long-term investments in publicly quoted stocks.

Berkshire now owns a diverse range of businesses including candy production; retail, home furnishings, encyclopedias, vacuum cleaners, jewellery, newspaper publishing and even makes and distributes uniforms and footwear.Berkshire Hathaway reported sales to the tune of $118.25 billion and profits stood at $13.21 in 2007.


Berkshire Hathaway traces its roots to a textile manufacturing company established by Oliver Chace in 1839. In 1929 the Valley Falls Company merged with the Berkshire Cotton Manufacturing Company established in 1889. The combined company was known as Berkshire Fine Spinning Associates. In 1962, Warren Buffett began buying stock in Berkshire Hathaway.

After some clashes with the Stanton family, he bought up enough shares to change the management and soon controlled the company. Buffett initially maintained Berkshire’s core business of textiles, but by 1967, he forayed into the insurance industry. Berkshire first ventured into the insurance business with the purchase of National Indemnity Company.

Courtesy: Rediff.com

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June 17, 2008

Is McCain Like Bush? It Depends on the Issue

WASHINGTON — The Democrats like to say that electing Senator John McCain would usher in the third term of George W. Bush, and they do not mean it as a compliment. The Republicans counter that calling the senator “McBush” is political spin and that Mr. McCain is his own man.

A look at Mr. McCain’s 25-year record in the House and Senate, his 2008 campaign positions and his major speeches over the last three months indicates that on big-ticket issues — the economy, support for continuing the Iraq war, health care — his stances are indeed similar to Mr. Bush’s brand of conservatism. Mr. McCain’s positions are nearly identical to the president’s on abortion and the types of judges he says he would appoint to the courts.

On the environment, American diplomacy and nuclear proliferation, Mr. McCain has strikingly different views from Mr. Bush, and while he shares the president’s goals in Iraq, he was at times an outspoken critic of the way the war was managed.

The disparities between the two are murkier on other issues. On immigration, Mr. McCain started out with Mr. Bush — at odds with the Republican mainstream — by favoring a path to citizenship for millions of illegal immigrants, then backed off and emphasized the border-security-first approach favored by a majority of his party.

When it comes to dealing with terrorism suspects, Mr. McCain has supported imposing tighter rules than favored by the administration on the use of harsh interrogation techniques, but has consistently been with the president on limiting the legal rights of Guantánamo detainees. In one indicator that his view of executive power is moving closer to that of Mr. Bush, his campaign has recently signaled that he believes it was constitutional for the president to authorize wiretaps without warrants to monitor Americans’ international phone calls and e-mail.

Mr. McCain has reversed himself on some issues — most notably, embracing the Bush tax cuts now after deriding them initially as fiscally risky and excessively skewed to the wealthy — and continues to adjust his positions on others. On Monday, he said he continued to oppose opening the Arctic National Wildlife Refuge to oil drilling, leaving him at odds with the White House and most of his party, but said he favored giving states more flexibility to decide whether to explore for oil off their coasts.

On balance, the McCain campaign has sought to emphasize the differences between Mr. McCain and the unpopular Mr. Bush rather than the similarities.

“In the last 10 years, he’s been an independent voice for what he thinks is in his country’s best interest,” said Mark Salter, one of Mr. McCain’s closest advisers. “Sometimes it’s brought him into conflict with members of his party and with the president. The Democrats know that.”

Yet while it would be hard to categorize him as a doctrinaire Republican or conservative, Mr. McCain appears to have ceded some of his carefully cultivated reputation as a maverick.

In a CBS News poll two weeks ago, 43 percent of registered voters said they believed he would continue Mr. Bush’s policies, and 21 percent said he would be more conservative in his policies than Mr. Bush. Twenty-eight percent said he would be less conservative than Mr. Bush.

Presidencies are about more than policies, of course, and Mr. McCain would bring a different style, background and world view to the White House should he be elected in November.

Although he once held very different views, Mr. McCain’s biggest similarity to Mr. Bush now is on the economy. Not only does the senator now support making permanent the large Bush tax cuts he once opposed — the $1.35 trillion tax reduction of 2001 and the $320 billion tax cut of 2003 — but he has proposed four major new tax cuts of his own.

Democrats say that those four proposed cuts — a reduction in the corporate tax rate to 25 percent from 35 percent, immediate tax breaks for corporate investment, a repeal of the alternative minimum tax and doubling the value of exemptions for dependents to $7,000 from $3,500 — are more regressive than Mr. Bush’s tax cuts because they favor the rich more disproportionately than the president’s reductions did. Mr. McCain’s advisers said his plan would help stimulate job creation by reducing taxes on small businesses, especially those that pay taxes at the personal income tax rate, and would be part of a fiscal plan that would also emphasize reining in the growth of government spending far more than Mr. Bush did.

On health care, Mr. McCain has a market-oriented model similar to the one that Mr. Bush proposed to little effect in 2007. Like Mr. Bush, Mr. McCain would shift the emphasis from insurance provided by employers to insurance bought by individuals, and would offer a tax benefit for families to do so.

“In general, they’re much more similar than different,” said Drew Altman, the president of the Kaiser Family Foundation, a health research group. “In terms of their goals, they’re more focused on making the market more efficient than in expanding coverage.”

Mr. McCain’s proposal, however, is more progressive in that it offers a refundable credit of $5,000 to families to buy their own insurance, whether or not they pay taxes — in effect, cash. Although experts have questioned whether the $5,000 tax credit would cover the cost of private insurance, they generally say that Mr. Bush’s plan, which offered a $15,000 tax deduction for families buying their own insurance, was more valuable to higher-income people.

On the Iraq war, Mr. McCain has been one of the president’s biggest defenders of its stated rationale: saving the world from Saddam Hussein. Yet he was also an early advocate of increasing troop levels at a time when Mr. Bush was resistant, and was withering, from 2004 on, about Donald H. Rumsfeld, then defense secretary, and what Mr. McCain called Mr. Rumsfeld’s “whack a mole” strategy of moving American troops from one violence-plagued part of Iraq to another.

Like Mr. Bush, Mr. McCain has steadfastly refused to set dates for withdrawals of troops and envisions a long-term American presence in the country. But last month, in the general election battleground state of Ohio, Mr. McCain did a semantic dance and said he expected that most American troops would be home from Iraq by 2013.

On abortion, Mr. McCain has long been opposed, and is in fact more explicit than the president in his opposition to Roe v. Wade, the 1973 Supreme Court decision that established a constitutional right to abortion. Although Mr. Bush has spoken about changing American “hearts and minds” to build a “culture of life,” Mr. McCain has said directly, in South Carolina in 2007, that Roe v. Wade “should be overturned.”

On judges, Mr. McCain has strongly embraced the judicial philosophy of Mr. Bush and vowed to appoint conservative judges in the mold of Chief Justice John G. Roberts Jr. and Justice Samuel A. Alito Jr.

On gay rights, Mr. McCain voted against a proposed constitutional amendment backed by Mr. Bush banning same-sex marriage, saying that it should be up to the states. Then in 2006, he made it clear how he thought his home state, Arizona, should decide: Mr. McCain appeared in a television commercial in support of a state amendment, which ultimately failed, to ban same-sex marriages.

Perhaps Mr. McCain’s biggest departure from the president is on climate change. Mr. McCain has called for mandatory limits on greenhouse gas emissions, unlike Mr. Bush, who says such limits would be bad for the economy. Mr. McCain also supports a “cap and trade” system in which power plants and other polluters could meet limits on heat-trapping gases like carbon dioxide by either reducing emissions on their own or by buying credits from more efficient producers.

Mr. McCain, who has a mixed record on the environment in the Senate — he has missed votes on toughening fuel economy standards and has opposed tax breaks meant to encourage alternative energy — has nonetheless tried to highlight what he considers his stark environmental divide with Mr. Bush.

“There is a longstanding, significant, deep, strong difference on this issue between myself and the administration,” Mr. McCain said last month.

On diplomacy, Mr. McCain has regularly distanced himself from the go-it-alone unilateralism of the Bush administration.

“We cannot build an enduring peace based on freedom by ourselves, and we do not want to,” Mr. McCain said in a major foreign policy address in Los Angeles in late March. “We have to strengthen our global alliances as the core of a new compact.”

In the same vein, Mr. McCain has significantly broken with Mr. Bush on nuclear security policy. Unlike the president, he supports a legally binding accord between the United States and Russia on limiting nuclear weapons, the elimination of tactical nuclear weapons in Europe, a strengthening of the Non-Proliferation Treaty, increased financing for the International Atomic Energy Agency and nuclear talks with China.

On Iran and North Korea, the two nations whose nuclear programs will present the next president with a tough set of options, Mr. McCain has allied himself with the Bush administration. He would refuse to engage in unconditional diplomacy with Iran and would continue to maintain contact with North Korea, primarily through multilateral talks. He has insisted, however, that the United States be able to verify effectively any agreement in which North Korea promises to abandon its nuclear weapons.

Courtesy: New York Times

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Bernanke Says Fed to Resist Price Expectations Surge (Update1)

By Craig Torres and Scott Lanman

June 10 (Bloomberg) — Federal Reserve Chairman Ben S. Bernanke said policy makers will “strongly resist” any surge in inflation expectations, delivering his clearest message yet the central bank is done lowering interest rates.

Bernanke played down the biggest jump in the unemployment rate in 22 years in May and said the risk of a “substantial downturn” receded in the past month. Policy makers will need to pay “close attention” to make sure the increase in commodity costs doesn’t pass through to broader consumer prices, he said in a speech to a Boston Fed conference late yesterday.

The Fed chief’s remarks spurred investors to bet that officials will raise rates later this year and sent two-year note yields to their highest level since January. Bernanke and his colleagues are raising the alarm on inflation after oil costs doubled in the past year and companies from Dow Chemical Co. to tire-maker Titan International Inc. raised prices.

“The Fed is looking for a fine balance in dealing with a weak economy and threat to inflation,” said Gary Schlossberg, senior economist at Wells Capital Management Inc., which oversees $225 billion. Bernanke’s speech “certainly increases the odds that the next move will be a rate increase,” he said.

Two-year Treasury yields, more sensitive to Fed rate expectations than longer-dated notes, climbed 12 basis points to 2.83 percent as of 8:54 a.m. in London. Traders anticipate the FOMC will keep its benchmark rate at 2 percent this month and raise it as soon as September, futures prices indicate.

`Destabilizing’ Threat

Central bankers “will strongly resist an erosion of longer- term inflation expectations,” Bernanke said yesterday at the Boston Fed’s annual economic conference in Chatham, Massachusetts. Any public anticipation of accelerating price gains “would be destabilizing for growth,” he said.

A measure of investors’ forecast for consumer price gains in the coming 10 years, derived from the difference in yield between Treasuries and Treasury notes linked to inflation, rose to 2.58 percent yesterday. The gap has averaged about 2.06 percent in the past decade.

A gauge of household expectations for inflation over five years climbed to a 13-year high last month, according to a Reuters/University of Michigan Survey.

The Fed faces a “complicated balance” of lowering interest rates to avert a recession “without taking too much risk that underlying inflation is going to accelerate over time,” New York Fed President Timothy Geithner said in New York yesterday.

Derivatives Deal

The New York Fed, the central bank’s main link with Wall Street, also yesterday announced an agreement with banks on changes aimed at easing the risk of a collapse of the $62 trillion market for credit-default swaps.

Seventeen banks that handle about 90 percent of the trading in the market will create a system to move trades through a clearinghouse that would absorb a failure by one of the market- makers, the New York Fed said.

Geithner said yesterday in his speech that “our first and most immediate priority remains to help the economy and the financial system get through this crisis.”

Fed officials have cut the benchmark lending rate to 2 percent from 5.25 percent in September. They next meet June 24-25.

The consumer price index rose 3.9 percent in the 12 months ending in April, up from a 2.6 percent gain a year ago. Energy costs have spurred the gains. AAA, the largest U.S. motoring group, said this month that gasoline surpassed an average of $4 a gallon (3.79 liters) for the first time. Oil prices reached a record $139.12 on June 6.

`Inflationary Impulses’

“The inflationary impulses that we have are beginning to dampen our economic activity,” Dallas Fed President Richard Fisher said in an interview with CNBC television yesterday. “Nobody at the Fed wants to countenance inflation.”

Bernanke said “the risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.” While risks to growth were still to the “downside,” he added that federal tax rebates, past rate cuts and record exports should underpin the expansion.

The unemployment rate rose to 5.5 percent in May, the most in more than two decades, as the U.S. lost jobs for a fifth month. Bernanke called the jobless figures “unwelcome,” though he added that recent economic data had “only modestly” affected the outlook for growth and employment.

“Inflation has remained high, largely reflecting sharp increases in the prices of globally traded commodities,” Bernanke said. Though “the pass through of high raw materials costs to the prices of most other products and to domestic labor costs has been limited,” officials will need to monitor for any change in the situation, he said.

Bernanke’s speech “was a marginal move toward more focus on inflation risks,” said JPMorgan Chase & Co. economist Michael Feroli, who attended the conference. “It notched down a little bit the concern on growth and notched up a little bit the rhetoric on inflation expectations.”

To contact the reporter on this story: Craig Torres in Washington at ctorres3@bloomberg.net; Scott Lanman in Washington at slanman@bloomberg.net.

Last Updated: June 10, 2008 04:35 EDT

Courtesy: http://www.bloomberg.com/apps/news?pid=20601068&sid=auEXa_HBdTm8&refer=home#

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The problem of food crisis does not seem to calm down in the near future due to affect of climate changesa ll across the worls.
June 10, 2008
The Food Chain

Worries Mount as Farmers Push for Big Harvest

GRIFFIN, Ind. — In a year when global harvests need to be excellent to ease the threat of pervasive food shortages, evidence is mounting that they will be average at best. Some farmers are starting to fear disaster.

American corn and soybean farmers are suffering from too much rain, while Australian wheat farmers have been plagued by drought.

“The planting has gotten off to a poor start,” said Bill Nelson, a Wachovia grains analyst. “The anxiety level is increasing.”

Randy Kron, whose family has been farming in the southwestern corner of Indiana for 135 years, should have corn more than a foot tall by now. But all spring it has seemed as if there were a faucet in the sky. The rain is regular, remorseless.

Some of Mr. Kron’s fields are too soggy to plant. Some of the corn he managed to get in has drowned, forcing him to replant. The seeds that survived are barely two inches high.

At a moment when the country’s corn should be flourishing, one plant in 10 has not even emerged from the ground, the Agriculture Department said Monday. Because corn planted late is more sensitive to heat damage in high summer, every day’s delay practically guarantees a lower yield at harvest.

“This is pushing my nerves to the limit,” Mr. Kron said one recent morning, the sky as dark as the unplanted earth.

Last winter, as the full scope of the global food crisis became clear, commodity prices doubled or tripled, provoking grumbling in America, riots in two dozen countries and the specter of greatly increased malnutrition.

As the world clamors for more corn, wheat, soybeans and rice, farmers are trying to meet the challenge. Millions of acres are coming back into production in Europe. In Asia, planting two or three crops in a single year is becoming more common.

American farmers are planting 324 million acres this year, up 4 million acres from 2007. Too much of the best land is waterlogged, however. Indiana and Illinois have been the worst hit, although Iowa, Wisconsin and Minnesota were inundated last weekend.

Bob Biehl, whose farm is near St. Louis, has managed to plant only 140 of the 650 acres he wanted to devote to corn. Some farmers in his area “haven’t even been able to take the tractor out of the shed,” he said.

United States soybean plantings are running 16 percent behind last year. Rice is tardy in Arkansas, which produces nearly half the country’s crop. “We’re certainly not going to have as good a crop as we had hoped,” said Harvey Howington of the Arkansas Rice Growers Association. “I don’t think this is good news for anybody.”

Harvests ebb and flow, of course. But with supplies of most of the key commodities at their lowest levels in decades, there is little room for error this year. American farmers are among the world’s top producers, supplying 60 percent of the corn that moves across international borders in a typical year, as well as a third of the soybeans, a quarter of the wheat and a tenth of the rice.

“If we have bad crops, it’s going to be a wild ride,” said the Agriculture Department’s chief economist, Joseph Glauber. “There’s just no cushion.”

As every farmer knows, trouble can come at any point before the harvest is complete. Danny and Karen Smith get up in the middle of the night at their wheat farm in Milton, Kan., whenever they hear thunder.

In a few weeks, the wheat they planted last fall will be ripe. A bad storm or, worse, a tornado could destroy it. Last year, the Smiths lost nearly all their wheat to a late freeze compounded by too much rain.

This year, the weather has been perfect: cool and moist. “See how plump these berries are?” Mr. Smith said, standing in the middle of one of his fields. “This will feed a lot of people.”

The world wheat harvest is forecast to rise more than 8 percent this year, because of better weather and more acreage under cultivation. But even this bright spot is tentative. Australia was expected to emerge from a two-year drought, but that prediction is looking somewhat doubtful.

With the exception of southwestern Australia and a small corner of southeastern Australia, little rain has fallen in recent months. Many wheat farmers have been unable to plant at all, said Bob Iffla, the chairman of the country’s Wheat Growers Association.

As a result, the harvest is likely to be below average: 5 million to 15 million tons of wheat available for export, compared with 17 million or 18 million tons in an average year.

China also faces trouble: the agriculture ministry issued an urgent notice to wheat and rice farmers in southern China on Sunday, telling them to harvest as much of their crop as possible immediately in the face of unseasonable torrential rains expected to rake the region for the next 10 days.

In the American corn belt, the issue has also been getting the rain to stop. After heavy rains and flooding last weekend, the price of corn on the commodity markets rose Monday to a record $6.57 a bushel.

“We can’t snap our fingers and make high yields,” said Emerson D. Nafziger, a professor of agronomic extension at the University of Illinois. “We still depend on the weather.”

A universal saying among farmers is that high prices never last, because they encourage production that fills the demand and drives down the prices. The current crisis is testing that theory. With costs soaring for fertilizer and diesel, the expenses of farming are so high that the urge to plant more is battling, in some places, with the temptation to plant nothing.

Prajoub Suksapsri in Ayutthaya, Thailand, is among the farmers going all-out this year. For the first time in two decades of farming, Mr. Prajoub is preparing to plant a second crop of rice on his land, which usually does not have irrigation.

He and his neighbors have risked their savings to set up a system to pump water into their fields. If rice prices stay high, Mr. Prajoub could make the biggest profit he has seen in years from his two-acre farm. But if prices fall, he could face heavy losses.

“Sometimes I lie awake at night, worrying about it,” he said, watching his new Honda generator chug steadily, running the pumps. The landlord for the fields that he rents is charging him more than triple the usual amount just for the right to plant an extra harvest.

“He is sucking my blood,” Mr. Prajoub said.

Helen Gabriel’s farm in south-central Luzon Island in the Philippines also measures two acres and lacks irrigation. Faced with soaring costs for diesel, fertilizer, rice seed and insecticide, she has made a different decision from Mr. Prajoub.

“We will have no crop this year,” Mrs. Gabriel said as she waited in a three-hour line for the right to buy 4.4 pounds of government-subsidized rice.

World stockpiles of rice are likely to shrink slightly this year, excluding Chinese food security reserves that are not available for world trade, after already dwindling markedly in six of the last eight years, said Concepcion Calpe, a Food and Agriculture Organization rice specialist in Rome.

That estimate does not take into account the turmoil in Arkansas. Last year, the rice crop in Arkansas yielded a record 160 bushels an acre. This year, experts there say, 150 bushels will be an achievement.

“There’s no doubt about it, we’re not going to have the rice to export,” said Carl Frein of Farmers Marketing Service in Brinkley, Ark. “Poor countries like Haiti, I don’t know what they’re going to do.”

For all the apprehension this year, the growing season is still young, with plenty of time for the situation to improve — or for crops to fail.

“I’ve seen mediocre starts get a bit better, and mediocre starts get a whole lot worse,” said Mr. Nelson, the grains analyst.

Mr. Kron, the Indiana farmer, gave up on corn last week after managing to plant — and in some cases replant — only about half of his 1,200 acres.

Last year, his corn yielded 150 bushels an acre. This year, he will be happy to get 130 bushels. He has warned his processor, Azteca Milling, which makes flour for tortillas and chips, that he will be short.

Mr. Kron’s prospects are deteriorating. He was hoping to plant soybeans on some of his unused corn ground, but hundreds of those acres adjoin the swollen Wabash River. On Monday, the fields started flooding.

“I don’t know if this is the worst year we’ve ever had, but it’s moving up the list pretty quick,” the farmer said.

David Streitfeld reported from Indiana and Kansas. Keith Bradsher reported from Thailand and the Philippines.


Courtesy: New York Times

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