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Showing posts from January, 2010

Obama's shift to political centre

Business Times - 29 Jan 2010


Obama's shift to political centre

He seems to be moving his focus away from healthcare reform and climate change to rising deficit and joblessness

By LEON HADAR
WASHINGTON CORRESPONDENT

SHIFTING gears for the second year of his administration and responding to the growing economic discontent among American voters who seemed to be turning against him and the Democrats who now control the White House and Congress - demonstrated in the loss of the Democratic Senate seat in Massachusetts - US President Barack Obama seemed to be moving towards the political centre during his first State of the Union address late on Wednesday night.

He shifted his focus away from healthcare reform and climate change to the more immediate concerns of the American people - the expanding deficit and the continuing high rate of unemployment.

While he still remains a popular president, Mr Obama has spent much of his first year in office and most of his political capital on what has…

Obama's new populist push against Wall St

Business Times - 26 Jan 2010


Obama's new populist push against Wall St

President and his aides hope new approach will help boost his political fortunes

By LEON HADAR
WASHINGTON CORRESPONDENT

AFTER one year in office and against the backdrop of growing anti-Wall Street anger among Americans being fuelled by continuing high unemployment rates and the signs that the big banks are once again taking reckless risks in the pursuit of quick profits, US President Barack Obama has decided that the time has come to alter the political-economic narrative of his administration.

Indeed, in the aftermath of the disastrous loss of the Democratic Senate seat in Massachusetts - a dramatic reflection of the populist mood around the country - and as he fights for his political survival (and that of his own Democratic Party), Mr Obama has decided that the time has come to get tough - really tough! - with Wall Street.

Launching a verbal assault against the mega banks and stating that the current econom…

Obama faces revolt of the independent

Business Times - 22 Jan 2010


Obama faces revolt of the independent

Tea Party movement wants action on jobs, not healthcare reform - which they see as wasteful government spending

By LEON HADAR
WASHINGTON CORRESPONDENT

ON THE eve of the one-year anniversary of Barack Hussein Obama's historic inauguration as the 44th President of the United States - the first African-American to hold that office - the new president ended up getting clobbered, big time, in Massachusetts.

No, President Obama was not running for any political office in the Bay State this week. But the fact that a little-known Republican politician (his main claim to fame was posing nude for Cosmopolitan magazine in 1982 when the magazine named him 'America's sexiest man') succeeded in defeating, by a decisive margin, a prominent Democrat in a special election to fill the US Senate seat that was held by the late Edward Kennedy (and before that by his brother, John F Kennedy) - was a devastating political blow…

Channelling populist anger to Wall Street

Business Times - 19 Jan 2010


Channelling populist anger to Wall Street

Obama's US$90b bank tax aimed at pacifying angry Americans, undermining Republicans

By LEON HADAR
WASHINGTON CORRESPONDENT

THE opening session of the Financial Crisis Inquiry Commission (FCIC) hearings on Capitol Hill - during which bankers from America's top financial institutions faced tough questions about the role that the banks had played in the financial collapse - looks like the first scene in a populist drama being staged by the Obama administration and its allies in Congress.

The main villains in this political production are all those infamous Wall Street companies that, after being bailed out by the American taxpayer, are now getting ready to reward their employees with record pay - around US$145 billion, according to the Wall Street Journal. Moreover, this is happening at a time when many Americans are losing their jobs and most of them are continuing to experience economic pain.

There is no dou…

Coming on TV: Congressional probe into financial crisis

Business Times - 14 Jan 2010


Coming on TV: Congressional probe into financial crisis

By LEON HADAR
WASHINGTON CORRESPONDENT

IT is a production that will not cost as much as the American science-fiction epic film Avatar. And it is probably not going to attract as large a television audience as the reality shows American Idol and The Biggest Loser.

But the televised hearings of the Congressional Financial Crisis Inquiry Commission (FCIC), which holds its first public hearings on Capitol Hill today, could prove to be one of the most dramatic spectacles of the season, offering some of Washington's leading investigators an opportunity to confront Wall Street's top financial executives, and examine the root causes of the 2008 financial crisis.

The year-long investigation by the FCIC, a bi-partisan 10-member panel established by Congress and which was allocated US$8 million for its work, has been compared to the work done by the 9/11 Commission which Congress formed in order to examin…

It doesn't look good for jobs - and for Obama

Business Times - 12 Jan 2010


It doesn't look good for jobs - and for Obama

A weak job market is slowing the momentum of the economic recovery

By LEON HADAR
WASHINGTON CORRESPONDENT

FIRST, let us go to the bad news: the US Labor Department report issued on Friday indicated that with 85,000 jobs lost last month, the American jobless rate was unchanged at 10 per cent in December. These numbers have disappointed Obama administration officials and some economists who had expected fewer losses of about 10,000, with optimists predicting a slight growth in employment.

US officials have tried to spin the depressing news as not-so-bad news, suggesting that taking into consideration the job growth in November - according to revised figures, 4,000 jobs were added in that month - points to a process of 'stabilisation' of the American economy.

'Today's employment report, though a setback from November, is consistent with the gradual labour market stabilisation we have been seeing…

Reforming US financial regulation in 2010?

Business Times - 06 Jan 2010


Reforming US financial regulation in 2010? Chances are not so great

By LEON HADAR
WASHINGTON CORRESPONDENT

FEDERAL Reserve chairman Ben Bernanke insists that more effective federal regulation of the financial industry - and not using the central bank's tool of higher interest rates in order to burst potential asset bubbles - is the best defence against future financial crises.

Calling the recent financial crisis the 'worst in modern history', Mr Bernanke said over the weekend that tighter regulation, and not interest rate hikes, could have prevented the sharp downturn.

'Stronger regulation and supervision' of mortgage lenders 'would have been a more effective and surgical approach to constraining the housing bubble than a general increase in interest rates', said Mr Bernanke during an address before the American Economic Association's annual meeting in Atlanta.

Indeed, Mr Bernanke's speech seemed to be an attempt to defend…