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Saturday, February 13, 2010

Whatever Volcker wants, Volcker gets?

Volcker Rules is about separation of commercial banking functions from high-risk activities

I FIRST met Paul Volcker, 82, in the summer of 1986. He was then chairman of the US Federal Reserve System (Fed). I was a rookie Fellow of the Eisenhower Exchange Programme, whose chairman was President Gerald Ford.

Volcker was well known to me as the towering central banker (at 6ft 7in, not sure if he is the tallest economist around; late Harvard Prof Ken Galbraith was about there). He was better known as the daring but brutal inflation fighter of the late 70s and early 80s, at great cost in lost output and jobs.

He was kind to me when I visited him in his office; even gave me lunch. He was impressive, friendly and had time for a visitor (and fellow Harvard alumnus) who was completely at awe with what he does. We spent four hours together. We have since been in contact, off and on.

The Volcker Rule

Volcker is now back at centrestage, after retiring from the Fed some 20 years ago. This time, introduced as the “tall guy behind me”, President Obama proposed a “simple and common sense reform, which we are calling the ‘Volcker Rule’.” Essentially, the new bank reforms would ban proprietary trading and prevent banks from “owning, investing in and sponsoring” hedge funds or private equity ventures. The proposals are intended to curb the size and spread of the biggest US banks.

Volcker had pushed hard for such a version of the separation between commercial and investment banking, first brought into being by the Glass-Steagall Act of 1933, soon after the Great Depression. He considered this to be key in resolving the problem of banks getting “too big to fail” (TBTF).

Indeed, it challenges the status quo that institutionalises moral hazard and exposes governments to constant bailouts at taxpayers’ expense. Volcker wants to limit this guarantee. His proposal was first mooted more than a year ago.

The mayor and the gunslinger

Volcker’s Rule can be likened to separating a prosperous cowboy town’s operations into the mundane mayor-like activities (safe and less risky but unexciting) and the gunslinger-like operations (indulging in taking undue risks and speculation, e.g. credit default swaps or CDSs), including proprietary trading for own profit, quite unrelated to serving their customers.

This Rule would provide government backing for the unexciting but safe town-mayors, but not to the speculative gunslingers. Thus, getting banks out of the gunslingers’ business would eliminate the likes of Bear Stearns and Lehman Brothers from holding government hostage – a moral hazard every time. These gunslingers should be allowed to fail.

Volcker rationalised that banks are sheltered by the government because providing credit is critical to economic growth. As such, they should be prevented from taking advantage of the safety net to make risky investments. For Volcker, banks are there to serve the public and that’s what they should do. Other activities can create conflicts of interest. They create unnecessary risks.

Wide ranging support

Once called “big nanny” by Walter Wriston (chairman of Citicorp in the 70s and 80s), Volcker has a towering reputation worldwide. “He is brilliant, eminently logical and steadfastly devoted to his work,” said D. Rockefeller (Volcker’s boss in the late 50s). According to an old friend, Gerry Corrigan (New York Fed president when Volcker was Fed chief), whenever Volcker was criticised, he never “flinched” simply because “he’s a man of utter conviction and absolute integrity.”

That’s why Volcker’s ideas are widely respected. European Central Bank president Jean-Claude Trichet offered qualified support: it goes “in the same direction of our own position”. Along the way, he picked up other allies – notably John Reed (former chairman, Citicorp) and Stanley Fischer (ex-deputy CEO, International Monetary Fund or IMF).

Support has also come from chairman of the Financial Stability Board, the new president of the Swiss National Bank, and France’s Finance Minister: “It is a very, very good step forward.”

Mervyn King (governor, Bank of England) had been an early campaigner of a similar proposal to resolve the TBTF problem: “After you ring-fence retail deposits, the statement that no one else get bailed out becomes credible…That is the argument for trying to create firewalls.”

His version goes further than Volcker’s: He wants government to break up the big banks into “utilities” and “casinos” – the former are safe, the latter to live and die in the markets.

There is, of course, support from Prof J. Stiglitz (2001 Nobel Laureate in economics): “Banks that are too big to fail are too big to exist…That means breaking up too-important-to-fail (or too-complex-to-fix) institutions.” The latest being Harvard Prof N. Ferguson: “So far, there is only one credible proposal.” Since then, George Soros has also come on board.

Deciphering the Volcker Rule

The United States desperately needs financial reform. Ironically, as a result of massive government support, banks as a whole are now doing reasonably well. This contrast of strong finance and a weak jobless economy in the early stages of recovery makes the politics of reform easy to understand. But, unemployment looms large.

Voters in the United States feel betrayed by the banks and want to feel that their anger has been heard. Yet, voters cannot be sold on technicalities. The Volcker Rule (VR) has concerns in controversial technicalities.

The best insight I have read in deciphering the VR is provided by two of the London Financial Times’ best economic columnists, Martin Wolf and John Gapper. I have respect for Wolf, whom I have met occasionally at seminars run by Harvard’s Marty Feldstein at the National Bureau of Economic Research. Wolf raises three pertinent questions: are Volcker’s proposals desirable, workable and relevant?

Desirable? Of course. Surely, banks should not be allowed to exploit the government’s “guarantee” to make speculative investments with little economic benefits. The very idea of banks profiteering from activities from whose consequences they had to be rescued and of whose impact the public is still suffering, is despicable. Nevertheless, Wolf thinks the VR is not the best way to go.

Workable? Here many doubts arise. Where do you draw the line (and police it) between legitimate bank activities and activities “unrelated to serving their customers”. Various technical considerations begin to blur the line. Further, how is bank size to be measured? Definition technicalities get more complicated.

Relevant? Wolf argues persuasively that vast affiliated parts of the financial system which have evolved from deposit-taking are vital; and indeed represent well-coordinated component parts of the entire system. These have become so interconnected that the system operates as one integral whole. Then, there is “shadow” banking (institutions with promises to repay liabilities on demand), which is vulnerable to a “run” as well. The list extends to money market funds, finance companies, structured investment houses, securities dealers, etc.

Surely, this chain of shadow institutions can’t be ignored in any reform exercise. Ironically, during the crisis, banks’ investments in hedge funds, private equity and even proprietary trading were not at the “core” which went terribly wrong.

Gapper argues that “Volcker has the measure of the banks.” For the first time, he states: “A government is attacking the size and complexity of the over-mighty institutions.” Impractical? No way. Hedge funds and private equity can be readily hived off from banks with access to the Fed window and Federal Deposit Insurance Corp insurance.

Granted, the definition of proprietary trading can be technically tricky. But, in reality, banks know what a proprietary desk is. Indeed, Volcker assured US Congress that “bankers know what proprietary trading is and is not. Don’t let them tell you different…I don’t think it’s so hard.” He emphasised: “What I want to get out of the system is taxpayer support for speculative activity.”

Gapper didn’t think much of Wolf’s idea that the VR would not fit outside the United States where Europeans are not only wedded to the universal bank model but love big banks. Hence, there will be difficulties in international coordination of regulation. This is an over-reaction.

Gapper argues that the VR does not prevent the investment houses from – indeed, they are already taking – big risks. What is important is for the US system to be reformed and made stable. The VR would not curb innovation or stop hedge funds and private equity from making money. Curbs on very large financial institutions are compatible with – indeed, can stimulate – a thriving and stable financial system.

It is noteworthy that Volcker himself concedes that the proposals would not have prevented the debacles at American International Group and Lehman at the heart of the 2008 crisis. But he stated emphatically that not adopting the proposals would surely “lead to another crisis in the future”.

Can big banks really walk alone?

Both Wolf and Gapper agree that the VR is not perfect – its implementation needs sharpening. As I see it, serious bank reform is a global problem. Other central banks should offer ideas. It’s worth trying to forge reform that is smart and practical. Lest we forget, contagion risk and counterparty failure globally have been the main hallmarks of the crisis.

Human nature being what it is, I don’t think we have seen the last of “gung ho” traders and their quants who just want to drive profits. Right now such activity is already back to up profits in some big banks. Since we don’t (and won’t) really learn, the separation of commercial banking functions from such high-risk activities is what the VR is all about.

I gather that OECD (a developed nations group) has also been looking at options. One concerns structuring systemically important financial institutions (SIFIs) under a variant of non-operating holding companies on a global basis, as follows:

(i) Parent is non-operational – only raises capital and invests transparently in legally separate SIFIs;

(ii) Profits are flowed-up through parent to shareholders;

 (iii) Parent not allowed to shift capital among subsidiaries in crisis and can’t request special dividends to do so. Such a structure allows for the separation of prudential risks and use of capital. In this way, regulators and investors can spot potential weaknesses. It creates a non-subsiding environment for the riskier business;

(iv) In the event of failure, the regulator shuts it down without affecting its commercial banking sister – obviating the need for even “living wills”. This offers an innovative, transparent way to achieve globally what both Volcker and King wanted but without being extreme.

Whatever the final outcome, a right balance needs to be struck between an appropriate size that’s conducive to benefit from purposeful diversification, and strong global competition to meet sustainable consumer demands at reasonable cost.

In the end, realistically, I can’t see how the VR or its variants, including what the OECD is working on, can really prevent another crisis, human nature being what it is. History is full of repeats where “greed” eventually overwhelms prudence and common sense.

Nevertheless, it could make one less likely, less often (we have had one every three years), and less costly if it did occur. To this, I think Churchill would have added: such a measure would make finance less proud but the industry more content.

Source: ● Former banker, Dr Lin is a Harvard educated economist and a British Chartered Scientist who now spends time promoting public interest. Feedback is most welcome; email:
starbizweek@thestar.com.my.


Obama fixes date for Dalai Lama


The Chinese government has branded the exiled Tibetan spiritual leader a separatist [Reuters]
The US president will meet the Dalai Lama in Washington next week, the White House has said, ignoring strong protests from Beijing to withdraw the invitation.

China, which had already warned that any meeting could hurt already-strained relations between the two countries, quickly reiterated its call for the meeting not to go ahead.

In a statement on Thursday White House spokesman Robert Gibbs confirmed that Barack Obama would meet the exiled Tibetan spiritual leader on February 18.

"The Dalai Lama is an internationally respected religious leader. He's a spokesman for Tibetan rights," Robert Gibbs, a White House spokesman, said on Thursday.
"The president looks forward to an engaging and constructive meeting."

In a possible nod to Chinese sensitivities the meeting is scheduled to take place in the White House Map Room, and not the symbolic surroundings of the Oval Office, where Obama normally meets foreign dignitaries.

'High sensitivity'

It is unclear as yet if Obama and the Dalai Lama, branded a separatist by the Chinese government, would meet in the open or behind closed doors.


"China urges the US... to immediately call off the wrong decision of arranging for President Obama to meet with the Dalai Lama... to avoid any more damage to Sino-US relations"
Ma Zhaoxu, China foreign ministry spokeman
Hours after the White House announcement, China's foreign ministry lodged a formal protest urging the US to immediately withdraw the decision. "We firmly oppose the Dalai Lama visiting the United States and US leaders having contact with him," Ma Zhaoxu, a ministry spokesman, said in a statement.

"We urge the US side to fully understand the high sensitivity of Tibet-related issues, and honour its commitment to recognise Tibet as part of China and to oppose 'Tibet independence'," he said.

He added that the meeting was a "wrong decision" and said it should be called off "to avoid any more damage to Sino-US relations".

The 74-year-old monk fled his Tibet homeland to exile in India in 1959, after a failed uprising against Beijing rule some nine years after Chinese troops were sent to take control of the region.

Strained ties

Obama avoided meeting the Dalai Lama when he visited Washington last year.

However in November the US president had warned Chinese leaders on a visit to Beijing of his intention to meet the exiled Tibetan leader.

Next week's meeting comes at a time when China-US ties have become strained over several issues, including a $6.4bn arms sale to Taiwan, the self-governing island Beijing claims as its own.

Relations have also been strained over internet censorship, with search giant Google Inc threatening to shut down its China business following what it said were cyber-attacks against the email accounts of rights activists.

Friday, February 12, 2010

10 Reasons Why a Google Fiber Network Could Reshape the ISP Landscape

News Analysis: Google announced recently that it plans to deliver a fiber network capable of delivering 1Gbps Web speeds. That's no small feat. The impact it could have on both the Internet and the tech industry as a whole cannot be understated. It could force changes in the entire U.S. ISP market, depending on whether Google eventually commits to widely deploying this 1Gbps network.

Google announced on Wednesday that it plans to deliver up to 1Gbps Web speeds to 50,000 people across the United States as part of an experiment to gauge the quality of next-generation apps, the viability of "new deployment techniques," and interest in "openness." Google might even ramp up availability to over 500,000 people in the U.S.

Google's announcement has sent shockwaves through the tech community. Just how much does Google plan to invest in its new fiber-optic deployment? How will major ISPs respond to the news? And perhaps most importantly, how will it impact the telecommunications industry? At this point, Google's exact intentions are unknown. But it could have a profound effect on the tech industry.
 

Zahrain still chairman of IGP


GEORGE TOWN: Bayan Baru MP Datuk Seri Zahrain Mohd Hashim, who has been critical of Penang Chief Minister Lim Guan Eng, has not been sacked as the chairman of Island Golf Properties Bhd (IGP).

Lim said Zahrain was still chairman of the Penang Development Corporation (PDC) subsidiary “at the present moment.”

“PDC has informed me that no letter has been sent by either PDC or Island Golf Properties to any director of Island Golf Properties on any changes,” Lim said in a statement here yesterday.

He said Zahrain had been chairman and director of Island Golf Properties since July 9, 2008.

Zahrain claimed yesterday that he had been sacked as IGP chairman.

“Zahrain’s statement is a pack of lies,” Lim said.

Lim added that the PDC, which owns BJCC via its subsidiary Island Golf Properties Berhad, had decided to award the tender of managing BJCC to an experienced company valued at more than RM40mil.

Full details of the tender would be published after Chinese New Year in accordance with the state’s principles of Competency, Accountability and Transparency (CAT), Lim said.

He said certain actions and claims by Zahrain on IGP had compelled PDC to monitor it closely to ensure the company was run with the public interest at heart.

“PDC is concerned at how Zahrain is leading the IGP, when he and IGP recommended on Jan 12 last year that the operations of BJCC be outsourced and awarded to a company with a paid-up capital of RM2.

“To allow a RM2 firm to run BJCC, which involves expenditure involving millions of ringgit, makes a mockery of the open tender system. The company has no track record in running a golf club,” Lim said.

When contacted, Zahrain said: “If they have not sacked me so be it, but the issue is not about me but Lim’s arrogance and his dictatorial style in managing the state. I have reprimanded him, yet he remains stubborn.”

On the tender issue, Zahrain clarified that he only chaired board meetings.

“I don’t interfere with its daily operations. I am only paid allowances for the meetings. I have no hidden agenda, and to be accused of trying to push through a RM2 company is a fabrication. They are trying various ways to boot me out.

“I criticised Lim because I have the interests of PKR and the people at heart. Nothing more and nothing less,” Zahrain said.

Related post:

BJCC Golf and Country Club News



Let’s roar, not whimper

It’s time for the 40- and 50-somethings to stick their necks out and take the lead.

COME Sunday, it will be the first day of the Lunar New Year and it will be the start of the Year of the Tiger according to the Chinese 12-animal zodiac. This also means that this is my year as my zodiac sign is that of the Tiger.

This also means that I am 48 years old as I have gone through this cycle four times and the next time the tiger year comes around, I will be 60.

Over the past year, I have been brooding and dreading the coming of 2010 as it can only mean that I am going past mid-life still stuck in a crisis and it is going downhill after that.

However, as the Lunar New Year draws nearer, I find the gloom lifting and the rush of a new vigour of energy – it is as if I have gotten a shot of artificial booster to overcome anything that may stand in my way.
Maybe, this burst of adrenaline has got something to do with the fact that it has been over 40 days since I last had a cigarette, but I would like to think that the pending arrival of the Golden Tiger is responsible for my enthusiasm.

Those of us born in the 1960s are the country’s pioneers and I make no apology for this sweeping statement. We were the first lot to go through the change from English schools to Sekolah Kebangsaan.

We were the first to memorise and sing all those patriotic songs like Tanah Melayu, Malaysia Berjaya, Putera-Puteri, Barisan Kita and Muhibbah. We sang those songs with fervour and gusto although most of us did not understand the full meaning of those songs.

We were all schoolchildren when the race riots of May 13, 1969, broke out. It was our loss of innocence; suddenly we referred to each other in ethnic terms – most of the time in the rudest possible way. Overnight, we were a multi-racial country when prior to that we were just Malaysians.

Did we, children of the 1960s, have a choice in any of these things? No, we did not. The policies that followed and came about after May 13, changed our lives. Everything we did and were done to us was supposedly based on these policies by the people entrusted to implement them.

Sadly, today many of us realise that the implementers somewhat lost the plot along the way and carried out their duties over-enthusiastically and, in some cases, not in the spirit in which the policies were drawn up.

When we were old enough to realise that many of us had suffered at the hands of these zealots, we were so brow beaten that we, then the youth of the 1970s, just meekly accepted our misfortunes and avoided any confrontation when seeking our rights.

Instead, our parents found alternative routes and pathways for us. It was the same, regardless of we being Malay, Chinese or Indian, because then we left things to our parents to decide not knowing that they too were also experiencing these things for the first time.

For the non-Malay parents, they just drew on what they thought their fathers and mothers would have done – they prepared many of us to feel as though we were not going to stay on in Malaysia forever – they prepared us to be migrants.

For the Malays, because of the distrust created by the actual May 13 event and the propaganda that followed, the parents prepared the children to live without their non-Malay neighbours.

It would be easy for us today, with the benefit of hindsight, to judge everyone then – although some of us still cannot see clearly and are blinded by self-interest.

Then came the 1980s – the boom time for the world, where getting rich was the name of the game. We, the baby boomers, were just too busy making money to care about where Malaysia was heading or that there was a parallel economy in the country then.

Malaysia was flying high then but when we came crashing back to earth in the late 1990s the so-called Malaysian Dream was shattered. We left it to the politicians to resolve the problems, but instead they brought all of us into deeper conflict.

A decade later the same characters continued to dominate our lives when they should have faded away like bad nightmares.

We, who were born in the 1960s, are now fathers and mothers of children in their teens and twenties – the ages where their futures and thoughts are shaped.

In many ways they are luckier than us. They are more enlightened, and they also have more enlightened parents. The children born in the 1990s know what they want, and they know how to get it.

Unlike our parents, we must now stand up for them to ensure that none of them are deprived of anything that is rightly theirs. In a world where a country of 27 million is considered a small one, we must ensure not a single child of the 1990s is deprived at all. We are rich enough – in wealth and knowledge – to support everyone.

The May 13 incident brought about the New Economic Policy to ensure the fair distribution of wealth. I believed the policy is now outdated. I think Prime Minister Datuk Seri Najib Tun Razak agrees with me because he will soon unveil the New Economic Model (NEM).

But this time as parents – not as politicians or technocrats – we must watch over the NEM policies like hawks to ensure that these are implemented as the authors meant them to be. We must be brave enough to shout out if we find any weakness in the implementation, and ensure it is fixed immediately.

We, the children of the 1960s, owe it to our forefathers to make sure the NEM works and ensure that their descendants will thrive in their homeland. No one should be made unwelcome. No Malaysian should be referred to as an immigrant anymore nor should any Malaysian feel threatened by another.

If we get it right, there is more than enough in Malaysia for everybody.

This is the year of the Golden Tiger and it is time for Malaysia and its people to roar.

Source: The Star Friday 12, 2010
> Deputy Executive editor Wong Sai Wan is going to miss his son when he leaves for Melbourne next week but prays that he will have a great Malaysia to come back to.

Thursday, February 11, 2010

Clouded leopard: First film of new Asia big cat species


Earth News

The Sundaland clouded leopard, a recently described new species of big cat, has been caught on camera.

The film, the first footage of the cat in the wild to be made public, has been released by scientists working in the Dermakot Forest Reserve in Malaysia.

The Sundaland clouded leopard, only discovered to be a distinct species three years ago, is one of the least known and elusive of all cat species.

Two more rare cats, the flat-headed cat and bay cat, were also photographed.

Clouded leopards are one of the most elusive cats. They are very hardly ever encountered
Andreas Wilting
Leibniz Institute for Zoo and Wildlife Research
Details of the discoveries are published in the latest issue of Cat News, the newsletter of the Cat Specialist Group of the International Union for the Conservation of Nature (IUCN).

"Clouded leopards are one of the most elusive cats. They are very hardly ever encountered and almost no detailed study about their ecology has been conducted," says Mr Andreas Wilting of the Leibniz Institute for Zoo and Wildlife Research in Berlin, Germany.

Mr Wilting is leader of a project that evaluates how changes to the forest in the Malaysian part of Borneo impact carnivores living there.

As part of that project, the team places a network of camera traps in the forest, that automatically photograph passing animals.

The team, which includes the Malaysian field scientist Azlan Mohamed, also conducts regular surveys at night, by shining a spotlight from the back of a vehicle driven around the Dermakot Forest Reserve in Sabah.
Bornean bay cat (Photo courtesy of A Wilting and A Mohamd)

During one of these surveys, they encountered a Sundaland clouded leopard walking along a road.

"For the first eleven months we had not encountered a single clouded leopard during these night surveys," says Mr Wilting.

"So every one of our team was very surprised when this clouded leopard was encountered.

"Even more surprising was that this individual was not scared by the light or the noises of the truck.

"For over five minutes this clouded leopard was just roaming around the car, which compared to the encounters with the other animals is very strange, as most species are scared and run away after we have spotted them."

Film exists of a Sundaland clouded leopard held in an enclosure.
RARE CATS: FIND OUT MORE

And a tourist is thought to have taken a 30 second video of a wild Sundaland clouded leopard in 2006, but that video has never been made public.

Until 2007, all clouded leopards living in Asia were thought to belong to a single species.

However, genetic studies revealed that there are actually two quite distinct clouded leopard species.

As well as the better known clouded leopard living on the Asian mainland (Neofelis nebulosa), scientists determined that a separate clouded leopard species lives on the islands of Borneo and Sumatra.

The two species are thought to have diverged over one million years ago.

This leopard is now known as the Sunda or Sundaland clouded leopard (Neofelis diardi), though it was previously and erroneously called the Bornean clouded leopard.

Since 2008, it has been listed as vulnerable by the IUCN.

The clouded leopard, the largest predator on Borneo, appears to live at very low densities within the reserve, as it has only rarely been photographed by the researchers or camera traps.

During the surveys, the research team also discovered a juvenile samba deer (Cervus unicolor) which had been killed by a clouded leopard.

The scientists suspect a large male clouded leopard made the kill, and had removed part of the front right leg.

Despite being a commercial forest that is sustainably logged for wood, the Dermakot Forest Reserve in Sabah, which is an area of approximately 550km square kilometres, holds all five wild Bornean cat species.

Making its mark (Footage courtesy of A Wilting/A Mohamed/Cat News)

As well as capturing images of the clouded leopard, the researchers also recorded four other wild cat species.
One video shows a wild leopard cat scent-marking its territory.

This smaller species is more common in the area, and has been filmed before.

"But due to its mainly nocturnal behaviour, specific behaviours like the scent marking are rarely documented on camera," says Mr Wilting.

More thrilling are the pictures taken of the other cats: the flat-headed cat (Prionailurus planiceps), bay cat (Catopuma badia) and marbled cat (Pardofelis marmorata).

Marbled cat (photo courtesy of A Wilting and A Mohamed)
A marbled cat caught by a camera trap
"All three species are very special," says Mr Wilting.

"The bay cat was special, as there has never been a confirmed record of this species in our study site.

"Therefore I really did not expect to get a photo of this species and I was amazed when I saw this picture."

Since 1928, there had been no confirmed record of this cat, before it was rediscovered in 1992 in Sarawak.

It is currently considered to be one of the world's least known cat species, and is listed as endangered.
"In addition our record is the most northern record of this species, which is endemic to Borneo."

Specialised climber
"Also the records of the flat-headed cat are very special as well, because just a few camera-trapping pictures of this species exist," explains Mr Wilting.

"The flat-headed cat is a highly specialised cat, restricted to lowland forests and wetlands, those areas which have the highest destruction rates in Asia.

Flatheaded cat (photo courtesy of A Wilting and A Mohamed)
A flat-headed cat walks on by
"This was also the reason why we changed the classification in the red list in 2008 from vulnerable to endangered, which puts this species in the same category as the tiger.

"The marbled cat is presumably mainly arboreal and therefore it is much harder to get this species photographed with the ground-based cameras."

The marbled cat looks much like a miniature clouded leopard, with a cloud-like spot pattern and long tail.

"We have encountered this species twice during our night surveys in Deramakot and once we even observed it climbing headfirst down the tree-trunk.

"These cats have really amazing climbing skills."

Mr Wilting says that finding all five Bornean cat species in one area suggests that Dermakot Forest Reserve is home to a particularly high diversity of animals, especially as Borneo is one of the biodiversity hotspots of the world.

It also suggests that even commercially used forests, as long as they are managed sustainably, may harbour threatened cat species and therefore contribute to their conservation, he says.

The true colour of politics is grey

Malaysians must learn to notice the difference between political posturing and real championing of the people’s interests.

A LEARNED and articulate friend who’s a veteran in the legal fraternity did not contain his disgust towards the mainstream media during our last lunch meet.

Clearly distracted from the sumptuous spread on his banana leaf, he let it all fly, accusing newspapers of breaching new levels of banality and unfairness.

It was obvious that much of his tirade had something to do with reports on the ongoing Anwar Ibrahim Sodomy II trial and coverage of stories about problems faced by PKR and DAP.

In a gist, his point was: There are so many things going wrong with the country – economic numbers are bad, FDIs are down and peoples’ problems are mounting, etc. – but the media are only focuses on making the Opposition look bad.

Never mind the fact that the topic of discussion during our previous lunch date was what made the headlines then: racist remarks by a former aide to the Prime Minister who has since resigned.

Of course, this comes from yet another of my friends who no longer reads the newspapers but “just skims through them” for the sake of knowing what it is being published.

Like him, many say that they now get all their reliable information on the Internet.

But not this well-travelled and learned friend of mine, though. He confesses to being not Net-savvy and admits to relying on what his friends read and tell him.

As such, he has full faith in highly reputable publications like The Washington Post, which ran a very presumptuous opinion piece titled Why the prosecution of Malaysia’s Anwar Ibrahim matters to the West.

He also rates another report about an Australian MP condemning the political persecution of PKR’s de facto leader.

Yes, this group of knowledgeable folk share their photocopied clippings to reaffirm what they already know, and verily and firmly believe.

Much to the amusement of our two other regular lunch partners – a retired film maker and a fellow journalist, my banter with my learned friend ended on the usual amicable note by both agreeing to disagree.

The only question that comes to this friend and several others who always seem to get angrier each time we meet, has always been this: When it comes to politics, why do so many academically brilliant and highly rated professionals choose to only see things in black and white?

Surely, they must know that it is mostly grey out there.

And that’s the reality for politics everywhere in the world, not just in this small and insignificant country of 27 million people.

Yes, we could have been a greater and much more respected nation by now, 53 years after independence, if our politicians in power had ensured that the country’s fundamental systems of justice and good governance remained strong, and had done more to unite rather than disunite our diverse ethnic groups.

Let’s be honest about the ills faced by the country. Are they really new problems and issues, much as many of us would like to trace them to the sacking of one man who was one step away from absolute power?
There are none so blind than they who will not see. If we care to look, the root causes of our problems can be traced back almost three decades.

Ironically, personalities who were creators of the problems or used the corrupt systems to their utmost benefits at the expense of the country are still around portraying themselves as saviours.

Racism? Religious extremism? Failed educational policies? Take your pick.

Those among us, who have always seen ruthless politicians for what they are know whom to point our fingers at.

It is tragic that Malaysians are increasingly being divided by political partisanship. On almost every issue we are being forced to take sides and choose which one to defend.

At the core of most issues, the two sides are not really different, but the players are letting us believe that we are looking at night and day. Are we really all that naive?

American writer Mary Beth Rogers said only two kinds of people can afford the luxury of acting on principle – those with absolute power and those with none and no desire to get any.

As she put it, everyone else who wants to be effective in politics “has to learn to be ‘unprincipled’ enough to compromise in order to see their principles succeed”.

That’s the reality of politics and it’s being played out before our eyes. There are no heroes and villains. They can be decent or vile as they come, and we must be able to accept them for what they are.

Politics, after all, is all about power plans and an extended exercise in ego. As long as there are followers, there will be leaders.

Ultimately, all Malaysians, especially the learned among us, need to do is to observe and notice the difference between political posturing and real championing of the people’s interests.

So, when the time comes, just vote wisely. There is no need to continuously rave and rant.

> Associate Editor M. Veera Pandiyan likes this observation of George Orwell: All issues are political issues, and politics itself is a mass of lies, evasions, folly, hatred and schizophrenia.

Wednesday, February 10, 2010

Google Gmail tweak challenges Facebook, Twitter

MOUNTAIN VIEW, California (Reuters) - Google Inc is tapping its huge network of Gmail users and Web surfers to create a Buzz that it hopes will help it catch up with online social networking leaders Facebook and Twitter.


The world's No. 1 search engine on Tuesday launched Google Buzz, which allows users to quickly share messages, Web links and photos with friends and colleagues directly within Gmail, the company's popular email product.

Also, a new arsenal of products make the new social networking features compatible with mobile devices such as smartphones based on Google's Android operating system.

Google's new technology mimics some of the key features of popular social networking services like Twitter and Facebook, which are increasingly challenging Google for Web surfers' online time.

By integrating Buzz directly into Gmail, Google hopes to jumpstart its social networking push by leveraging the large pool of Gmail users.

"There's always been a giant social network underneath Gmail," said Google Product Manager Todd Jackson at a press event at Google's Mountain View, California headquarters on Tuesday.

Gmail is the third most popular Web-based email in the world, with 176.5 million unique visitors in December, according to comScore. Microsoft Corp's Windows Live Hotmail and Yahoo Inc's Mail were No. 1 and No. 2, with 369.2 million and 303.7 million unique visitors, respectively.

Google will roll out Buzz to Gmail users over the next few days, it said.

Status messages that users publish on Buzz and flag as viewable to everyone will be automatically indexed by Google's search engine and be available within Google's recently launched real-time search results. Google said users can also keep messages private by sharing only with customized groups of friends and colleagues.

Executives said users can easily share content from various Google online properties like photo-sharing service Picasa and video site YouTube.

Content from certain third-party services such as Twitter can also be shared, although users can only view Twitter messages -- or Tweets -- within Buzz and cannot publish new messages to Twitter's service.

Executives said that Buzz is not currently able to display messages that originated on Facebook, the world's No. 1 social network with 400 million active users.

"The fact that Gmail did not connect and allow broadcasts out to Twitter and Facebook could be a real challenge to them," said Forrester Research social media analyst Augie Ray. But he noted that Google's experience serving Web surfers' relevant search results could be a strength for the company in the social media segment as users are increasingly inundated with status messages.

Google has tried to ride the social networking wave before, launching the Orkut social network in 2004. But while Orkut is big in certain overseas markets like Brazil, it has failed to attract as many users as social giants like Facebook and MySpace in the United States.

In building a social network on top of an email product, Google is following in the footsteps of Yahoo, which has taken a similar approach in efforts to keep up with Facebook but has seen lackluster results according to analysts.

Google co-founder Sergey Brin said he was not deterred by other companies' experiences in melding email and social networking.

"I wouldn't discount something because it's similar in the one sense ... to something else in the past that may not be that successful," Brin said on the sideline of the event following the main presentations.

Google appears to be putting a heavy emphasis on mobile and location-based capabilities, weaving Buzz technology into the mobile versions of its flagship website and its online maps products. The company also announced a special mobile application for Buzz that will run on smartphones based on Google's Android software, Windows Mobile and the Symbian operating system.

Google shares rose $2.97 to close at $536.44 on Nasdaq.

(Additional reporting by Ian Sherr; Editing by Gerald E. McCormick and Richard Chang)