RECESSION IN US

The recession - rather impending recession of USA - which is sending severe chill down the all finance ministers / economists of Global village - was only overdue. No economy - howsoever mighty it may be- can and should survive on most illogical policies / programmes . If one closely study one singular fact - the trade deficit of US economy - the whole picture becomes clearer. Factually USA has been in huge - almost up to 60% - trade deficit from last 30 years. No logic or theory can justify even the survival of such an economy. USA survived and has been surviving only because of its Politico-military hegemony. The very policies of World Bank/IMF - who are most lberally US's stooges have been towards docking of all other economies of the world so as to safeguard the US interests and continuation of its Economic hegemony ; have become self evident - be it be example of latin America or East Asia. There has been contineous and sustained strategy of US to create one or other crisis - IRAQ-North Korea-Phillistine- Iran so as to sustain its uncompetitive/ irrational/ illogical economic hegemony. So the CRISIS and resultant "RECESSION" was only very much expected.

Recession likely in US

http://www.bloomberg.com/apps/news?pid=20601087&sid=a_TgRes4VjjU&refer=home

Dec. 3 (Bloomberg) -- U.S. corporate profits are in a recession, and the entire economy may not be far behind.

Slower sales and higher energy and labor costs are forcing companies from Bear Stearns Cos. to Pitney Bowes Inc. to reduce spending and hiring. Their efforts to keep earnings from eroding even further raise the risk that the economy, already weakened by the steepest housing slide since 1991, may shrink sometime next year.

``The earnings recession has already arrived,'' says David Rosenberg, North America economist for Merrill Lynch & Co. in New York. ``We are going to see an economic recession in '08.''

Corporate profits, as measured by the Commerce Department, fell at an annual rate of $19.3 billion in the third quarter from the second, as domestic earnings dropped by $41.2 billion. The drag from sagging U.S. sales and huge writedowns offset robust earnings abroad, fueled by the weak U.S dollar. The fourth quarter may be an even bigger bust.

``In the third quarter, the tide shifted, and for the worse,'' says Joseph Quinlan, chief market strategist for Bank of America Corp. in Charlotte, North Carolina. ``The domestic-profits squeeze is in its early stages and will be severe enough to overwhelm strong foreign earnings.''

Caterpillar Inc. of Peoria, Illinois, the world's largest maker of bulldozers and excavators, shocked investors in October when it said it expected the economy to be ``near to, or even in recession'' in 2008. At the time, Dearborn, Michigan-based Ford Motor Co., the second-largest U.S. automaker, was still ``optimistic,'' Chief Executive Officer Alan Mulally said Oct. 15. ``There's a lot to be positive about,'' he told reporters.

`Dicey Territory'

Little more than a month later, in a Nov. 19 interview, Ellen Hughes-Cromwick, Ford's chief economist, said the economy was ``in some dicey territory,'' though would likely ``edge by'' without a recession.

Profits for the Standard & Poor's 500 companies fell almost 25 percent on a per-share basis in the third quarter, the biggest year-over-year decline in almost five years. David Wyss, S&P's chief economist, expects their earnings to fall as much as 30 percent in the fourth quarter as companies take more writedowns for bad investments. Excluding such extraordinary items, operating profits may fall as well, he says.

Consensus estimates compiled by Bloomberg indicate S&P 500 operating profits may rise just 1.1 percent in the current quarter.

Reduced Expectations

That's down from the 8.8 percent increase analysts foresaw a month ago. Operating profits fell 2.5 percent in the third quarter, the first drop in more than five years.

Even if profits have peaked, that doesn't mean the economy is about to turn down, says Steven Wieting, managing director of economic and market analysis at Citigroup Global Markets Inc. in New York. In the last expansion, profit margins began contracting in late 1997; there was no recession until March 2001.

What's troubling this time is that much of last quarter's damage came in the financial sector, where operating earnings fell 25 percent, as banks and brokers were hurt by losses from subprime mortgages and related investments. Analysts' estimates compiled by Bloomberg indicate the industry's profits this quarter may decline more than 25 percent.

The plunge in financial profits is a triple whammy for the economy as banks and other institutions pare payrolls, cut capital spending and become stingier with loans.

Job Cuts

Bank of America, JPMorgan Chase & Co., Bear Stearns, Citigroup Inc., Lehman Brothers Holdings Inc. and Morgan Stanley have announced some 25,000 job cuts so far this year. Gustavo Dolfino, president of New York executive-search firm Whiterock Group LLC, said in a Nov. 20 interview he expects them to fire thousands more.

Claims for unemployment benefits jumped to a nine-month high in the week ended Nov. 24. Economists polled by Bloomberg forecast that data to be released Dec. 7 will show payroll growth slowed to 70,000 in October from 166,000 in September, while the jobless rate rose.

``We see a significant slowdown in the growth of jobs and equipment spending in 2008,'' says Allen Sinai, chief global economist for Decision Economics in New York.

Orders for non-defense capital goods excluding aircraft, a proxy for future business investment, fell 2.3 percent in October, the most since February, according to Commerce Department figures.

Disappointed Investors

Weaker business spending held back sales at Cisco Systems Inc., the world's biggest maker of networking equipment. That disappointed investors, who have pushed the San Jose, California- based company's shares down more than 17 percent since Nov. 6. Chief Executive Officer John Chambers said orders have slowed from Cisco's top 25 U.S. customers, which include eight financial- services companies.

Stamford, Connecticut-based Pitney Bowes blamed weakness in the financial-services market for a 14 percent drop in its quarterly net income. The company, the world's largest maker of postal meters, also announced plans to fire 1,500 workers.

The biggest hit to the economy from fading financial profits may come from tighter lending standards. The Federal Reserve reported last month that banks were making it harder for businesses and consumers to borrow. Analysts including Sinai expect terms to tighten further.

Advanta Corp., a Spring House, Pennsylvania-based provider of corporate credit cards, cut its 2007 earnings forecast Nov. 27 and withdrew its 2008 estimate as late payments rose.

``Higher delinquency rates will continue for some time,'' Chief Executive Officer Dennis Alter told analysts. ``What is not clear is where the economy and consumer behavior is headed.''

Sinking Boat Sales

Scarce credit could make things even tougher for companies such as Brunswick Corp. of Lake Forest, Illinois, maker of Bayliner boats. The firm is cutting 170 jobs as it struggles with what Chief Executive Officer Dustan McCoy suggested might be the weakest U.S. boat market since 1965.

Foreign companies are starting to feel the fallout from weakness in the U.S. -- a reversal of the recent trend, in which American firms benefited from strength overseas.

Stockholm-based Ericsson AB, the world's biggest maker of wireless networks, said Nov. 20 that fourth-quarter sales may be at the lower end of a forecast it gave a month earlier as demand falters in North America and Europe.

Shares in Morgan Crucible Company Plc, a U.K. ceramics maker for the steel industry, plunged the most in nine years today after saying a weaker dollar and a slowdown in the U.S. construction and automotive markets will almost erase revenue growth.

Wolseley Plc said Nov. 28 it will cut 1,300 jobs in the U.S. after the decline in homebuilding led to a 15 percent fall in profits at the world's biggest distributor of plumbing and heating equipment.

``Looking out over the next 12 months, the U.S. is going to be very challenging,'' Chip Hornsby, chief executive officer of the Reading, England-based company, said on a conference call.

French Worker's strike

http://www.wsws.org/articles/2007/nov2007/fran-n29.shtml

The betrayal of the French rail workers strike and the role of the LCR

The first trial of strength between president Nicolas Sarkozy and the French working class has ended by the end of November. After a ten-day walkout, the strikers returned to work under conditions in which the government refused to withdraw its reform of their pensions, the so-called régimes spéciaux. The trade unions are negotiating over the price of their surrender.

The French and international business press have struck a triumphant note. Le Figaro declared that the reform of the régimes spéciaux, the “mother of all reforms”, has convinced public opinion, “that everything must change in this country”. Next on the agenda is “the reduction of the public sector, as well as reducing the budget deficit and the expenditures on social insurance”.

The left press stresses that the strikers were not defeated in their struggle, but betrayed. The breaking of the rail workers strike has already had serious political consequences. Barely had the strikers returned to the work, when violent youth protests erupted in the suburbs. The strangling of the strike intensified the isolation of the most suppressed layers of society, whose future is inseparably bound up with the fate of the working class.

The betrayal of the trade unions

President Nicolas Sarkozy was prepared for the dispute over the regimes spéciaux since the spring so as not to suffer the same fate as Alain Juppé, who as head of government in 1995 made an initial attack on pensions, but was then forced to retreat and eventually resign from office following massive popular resistance.

Even before taking office, Sarkozy had met with the leaders of the most important trade union federations. He told them: “I want to tell you one thing immediately. I will carry out this reform (i.e. régimes spéciaux). The rest is a matter of negotiation.” (le Monde 26.11.) Since then he has cultivated his ties to the union leaders with a series of both public and private meetings, including dinner dates.

Unions, however, were not able to bring about an immediate end to the strike. The grass-roots resistance was too great. Possibly the strategy of attrition was used by unions—the strike was allowed to continue without support from above until it finally ran out of steam. Despite the considerable costs to the French economy, Sarkozy supported this strategy.

Proposed reforms include: the labour code, the merger of the employment exchanges with the unemployment welfare offices, private sector pensions, vocational training.

How the LCR and LO supported the sell out

The trade unions were already heavily discredited at the beginning of the strike. Open distrust of the leadership prevailed at strike meetings. Most discussions revolved around the issue of how to prevent a sellout by the trade union apparatuses. Resolutions were passed which warned of any deal made without prior to consultation with the rank and file.

During the past 12 years, French workers have undergone a series of experiences where the trade unions have intervened to demobilise social disputes and organised sellouts.

The result of the conflict in 1995 was not the success it is often claimed to be. At the time, hundreds of thousands of workers struck for three and a half weeks in the defence of social security benefits, pensions, health insurance and jobs. Millions took part in demonstrations. The most disputed part of the Juppé plan was withdrawn, but all his other measures remained in place. Prime Minister Juppé was able to hold onto his post for a period of time, and President Jacques Chirac was given the necessary breathing space to prepare a regulated change of government.

In 2003 the government renewed its reform (termed as attack by labor unions) on pensions and was able to impose its measures in the face of substantial protests.

In the course of the presidential election this year, the Socialist Party tried to overtake Sarkozy from the right on many issues. Following its defeat at the polls prominent members of the party switched directly into Sarkozy’s camp. In the course of the rail worker’s strike the Socialist Party did not even put up pretence of defending the interests of the workers. The party supports the essential point of Sarkozy’s reform, making workers covered by the special pensions work a minimum of 40 years, instead of the current 37.5, before receiving a full pension.

The discrediting of the trade unions and the official left parties has enabled the parties of the radical left to acquire considerable influence. Lutte Ouvrière and increasingly the LCR have become regular components of official French politics. In 2002, nearly ten percent of the electorate cast their votes for the presidential candidates of the two organisations—Arlette Laguiller and Olivier Besancenot. In this years presidential election, 1.5 million voters for Besancenot.

The utterly cynical and deliberate manner in which the LCR defends the bureaucracy was demonstrated in a public meeting held on October 22 in Paris. The meeting, featuring Olivier Besancenot as the main speaker, had been carefully prepared. Posters had been hung throughout Paris. In the event, around 2,000 assembled in the large hall of the Mutualité in the Latin Quarter.

One day previously, the trade unions had entered into negotiations with management and the government and on the morning of the 22nd most of the general assemblies of striking workers had voted to break off the strike. Nevertheless, Besancenot refrained from saying a single word about the betrayal of the trade unions and tried to portray the sellout as a success. He celebrated the strike as an expression of an unstoppable movement which will continue to grow and finally force Sarkozy to back down. The social movement was not at an end, it would continue and become permanent, he declared. Now the job was to “assemble the forces, to increase the pressure from the streets even more in order to rebuff the reforms”:

This sort of hollow phrase mongering is the stock-in trade of every trade union bureaucrat. It is aimed at covering up one’s own responsibility and clouding the waters when it comes to drawing political conclusions. The LCR is expert in this form of demagogy

An international perspective

In Germany, train drivers have taken strike action during the last six months for improved working conditions and wages. They confront a broad front of opposition comprising not only the government and management, but also the country’s major trade unions, the SPD and the Left Party, which are agitating against the demands of the train drivers and organizing open strike breaking.

The Darjeeling Limited from Wes Anderson

Saw this entry and not sure. Posting here for review.
http://www.wsws.org/articles/2007/dec2007/darj-d01.shtml

Directed by Wes Anderson, screenplay by Anderson, Roman Coppola and Jason Schwartzman

Wes Anderson is an American filmmaker who has created certain expectations. He established himself as intriguing with his 1998 film, Rushmore, a stylized picture of the resourcefulness and energy of youth. With his amiable, amusing The Royal Tenenbaums (2001), about a household of child geniuses who never grow up, Anderson, however, began to run the risk of becoming a harmless iconoclast. His 2004 The Life Aquatic with Steve Zissou focused on the alienation and fragility inherent in social and family relations in an imaginative but limited manner. Still, one awaits the appearance of his films with interest.

Family angst and dysfunction are some of Anderson’s signature themes. His latest film, The Darjeeling Limited, again pursues these concerns as three estranged brothers attempt to reconnect while train-traveling in India. Although exhibiting his trademark aesthetic—a stretched realism among other surreal sensibilities—Anderson’s new film is less urgent and coherent than his previous efforts.

Like the private school in Rushmore, the ramshackle New York City mansion in The Royal Tenenbaums and the makeshift sea vessel in The Life Aquatic, Anderson’s exotic train in The Darjeeling Limited plays an active role. It is the moving center of the claustrophobic world of the Whitman brothers, a trio of wealthy Americans attempting a spiritual journey after the death of their father. (“We’re just trying to experience something.”)

Francis (Owen Wilson), the eldest, has organized the odyssey in a first-class sleeper car on the “Darjeeling Limited” after a near-fatal motorcycle accident left him longing for his siblings. (The fact that the head-bandaged Francis is an uncomfortable reminder of Wilson’s much-publicized attempted suicide last August has been universally noted.) With a daily itinerary—laminated by a personal assistant—Francis imperiously orders around brothers Peter (Adrien Brody) and Jack (Jason Schwartzman)....

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Follow Up

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News Snippets

An Abstract Sketch

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The life of an IT professional – always thinking in analytical terms?

 

 

Cancer studies 'wasted millions'

http://news.bbc.co.uk/2/hi/programmes/file_on_4/7098882.stm

Charity is mostly well intentioned but easy availability of money to those receiving charity may result in less than efficient use of the same. On November 20, BBC reported that millions of pounds of charity donations and taxpayers' money have been wasted on worthless cancer studies.

Thousands of studies have been invalidated as some scientists not carrying out simple and inexpensive checks to ensure they are working with the right forms of human tumour cells.

Earlier this year eminent cancer specialists from the UK and USA wrote to the US health secretary urging tough action to end this waste of time, effort and money. As per the report, the US authorities observed that there appeared to be "abundant evidence" that many studies and publications had been compromised.

While this is specific to cancer research, it may raise questions on the efficacy of charity based research for other medical ailments as well.