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October 21, 2016 / 19 Tishri, 5777

Posts Tagged ‘trade’

Turkey’s Trade Deficit Reveals an Economy in Deep Trouble

Sunday, August 5th, 2012

I’ve been hammering away at Turkey’s credit bubble problem for the past eight months: consumer lending is still growing at a nearly 30% annual rate, after dipping into the teens earlier this year (I am annualizing the 3-month growth rate). But the trade data just released for June show a slowing domestic economy.

With the economy clearly slowing, where are all the loans going? The answer is indicated by the extremely high interest rates charged by Turkish banks:

At 18% interest, consumers have to borrow to pay the interest on previous loans. In other words Turkish banks are capitalizing interest, and booking profits on loans that would go sour if they stopped lending additional money to borrowers to pay the interest. The much-vaunted strength of Turkey’s banks (whose stock prices recovered smartly this year) appears to be an illusion. The economic outlook isn’t good.

From the Financial Times‘ Beyond Brics blog:

At first glance, newly released figures for Turkey’s foreign trade suggest the country’s economy is holding up well despite the travails of its neighbours in Europe.

But as ever the devil is in the detail and hidden away in the numbers are some more uncomfortable indications that darker days lie ahead for the Turkish economy.

Figures from TUIK, the statistics office, show a 30 per cent reduction in Turkey’s trade deficit, from $10.3bn in June 2011 to $7.2bn in June this year. Other figures from TIM, the Turkish exporters’ association, show exports for the 12 months to July reaching $142.6bn, a healthy 12.3 per cent up on the previous twelve months.

Taken together, the two sets of figures could suggest continued success for Turkey’s exporters, while Turkish consumers have reined in their love of expensive imported goods.

But dig a little deeper…

To begin with, according to TIM’s figures for July, Turkish exports for the month actually fell by 5.5 per cent over July 2011 while both TIM and TUIK show worrying falls in exports to Turkey’s core European markets.

According to TUIK, Turkey’s exports to the EU dropped from 48.2 per cent of the total in June 2011 to only 37.1 per cent this year. TIM’s data suggest a drop from 47.7 per cent in July last year to 40.3 per cent.

According to TIM, the bulk of the fall came in two keys sectors: automotive, which saw exports in July plunge 22.3 per cent; and ready-to-wear textiles, where exports in July fell by 12 per cent.

While the two organisations collate their figures in different ways the outlook is clear: as Europe continues to sneeze, Turkey will catch a cold.

The picture is more worrying when the effect of the weakening euro is taken into account, an effect which economy minister Zafer Caglayan estimates cost the country $550m in July alone.

So far so bad. But according to Ozgur Altug, chief economist at Istanbul’s BCG Partners, the real bad news is hidden not in weakening export figures but in the falling import figures – which helped contribute to fall in the trade deficit and to a reduction Turkey’s current account deficit from $77bn a year ago to $67bn by the end of May this year.

Altug points out that Turkey’s dependence on imported energy remains the chief culprit behind its current account deficit woes. “Despite falling oil prices, the 12 month rolling energy balance rose to $51.4bn by the end of June this year, compared with $47.8 at the end of 2011,” he says. “The government has been successful in rebalancing the economy but the structural problems such as the growing need for imported energy are still there”.

Altug warns that an improvement in the non-energy trade deficit is also illusory. He points to an 11 per cent drop in imports of intermediate goods over the first half of this year and a 16 per cent drop in consumer goods over the same period.

Both, he suggests, are a direct result of slower GDP growth, with the former suggesting a drop in imports of capital goods used to expand output, the latter indicting declining consumer confidence. The root problem, he suggests, is Turkey’s failure to capitalise on years of rapid economic expansion to increase the contribution of exports to the overall economy.

David P. Goldman

What a Fast Food Franchise Can Teach You About Managing Your Own Money

Tuesday, July 31st, 2012

When I recently interviewed Michael E. Gerber, author of The E-Myth, on the Goldstein on Gelt show, we spoke about the techniques for running a business that can be applied to managing your own money. Interestingly enough, Gerber uses the famous McDonald’s fast food chain as a great example of optimum business management.

Gerber told me that, “Given the failure rate of most small businesses, he [Ray Kroc, the founder of McDonald’s] must have realized a crucial fact: for McDonald’s to be a predictable success, the business would have to work, because the franchisee, if left to his own devices, most assuredly wouldn’t!…Once he understood this, Ray Kroc’s problem became his opportunity… Forced to create a business that worked in order to sell it, he also created a business that would work once it was sold, no matter who bought it… a foolproof, predictable business…. A systems-dependent business, not a people-dependent business.”

I believe that investors need to see their own portfolios as a franchise opportunity. It’s not that they will actually franchise their stocks and bonds. Rather, they must have a portfolio that is scalable, based on a dynamic asset allocation that can be quickly adjusted if their goals change or if the market situation varies. All of their investment decisions must be based on a set of rules that can be easily documented and explained to someone else. Financial plans and investment policy statements correspond to the manual that an entrepreneur would write about how to run every aspect of his business.

Additionally, you should follow the principle of, “Work on your investments, not in them.” Just as The E-Myth advocates business owners working on their businesses, not in them, investors should concentrate their efforts on the larger picture of the goal of the investment portfolio, and not become bogged down in the daily details of researching stocks and funds and making decisions on trading. Study after study has shown that when people manage their own accounts, they do more damage than good. So why do individual investors continue to be their own money managers? It’s because they think that they must oversee and trade their investments themselves. That mistake alone has cost people billions of dollars.

In summary, managing your own portfolio is like managing a small business. What other comparisons can you think of? Send me an email about other types of comparisons you have seen between running a business and running your portfolio.

Doug Goldstein, CFP®

Nadler Hails 20-Year U.S. Govt. Lease at One World Trade Center

Wednesday, July 18th, 2012

Congressman Jerrold Nadler (D-NY) of Lower Manhattan welcomed the announcement that the U.S. General Services Administration (GSA) has signed a 20-year lease for 277,000 sq. feet of office space at One World Trade Center.

The agreement with the Port Authority of New York and New Jersey and the Durst Organization makes official that 55% of the building is now leased ahead of expected completion in 2013.

“With this lease, GSA and the Port Authority have assured a robust future for the new World Trade Center complex,” Nadler said. “Now more than half leased, One World Trade Center will soon tower above the city, dramatically signaling the resurgence of Lower Manhattan and New York City. 10 years following the devastation of 9/11, Downtown is soaring to new heights, both literally and economically.”

Jewish Press Staff

Free Stock Trades Can Make You Lose Money. Here’s Why.

Sunday, July 15th, 2012

Have you ever found yourself buying a t-shirt that you would never normally be seen dead in, simply because when you walked into the store, you saw the sign, “Buy one, get one free”? And what about the window-cleaning gadget that you picked up from a street vendor for only $2 because he promised you that this was a bargain price and it would do wonders for your windows? Both of these purchases were totally useless, and you will probably consign them to the garbage next Pesach. But you still bought them. Why? Because they were either totally free or cost you next to nothing.

Similarly, when you are stock trading, have you ever been tempted to invest in a commission-free trade? These sound really great. You can choose your investment and if you put in a certain minimum, you don’t need to pay brokerage fees. Wonderful – you are saving money. But are you really?

Dan Ariely, a researcher specializing in behavioral finance, talks about “the power of free.” This is when people are tempted to be more reckless simply because the offer is free. Dan noted that when a New York nightclub offered free tattoos to its customers, even though the conditions were very far from optimal cleanliness, many of them actually took up the offer. In fact, his researchers discovered that 68% of those who received tattoos would not have bothered if they had not been free.

When you pay a fee for stock trading, you are less likely to be reckless because the thought of wasting these few extra dollars on something that may not work acts as a deterrent. But when you get a free trade, you may find yourself feeling similar exhilaration to a gambler in a casino. When the roulette wheel spins and he wins a little money, he takes it and throws it back into the game – promptly losing everything. Falsely, he thinks that as he won once, he can keep on winning. A free stock trade, in the eyes of many, has to be a good deal by virtue of the fact that it’s free, but that is not necessarily the case. While you may win some, you are just as likely to lose.

Secondly, you should always ask yourself the question of why something is free. Take a closer look at it. For example, if you are offered an ETF (Exchange Traded Fund) without needing to pay a commission, why is this? Perhaps it is because the ETF is in some niche segment that you would never normally consider and is far less lucrative than other types of ETFs. It is therefore extremely important to remember that even though such a trade is offered as a free deal, nothing has changed about the underlying investment.

The “power of free” is definitely an absorbing subject. If you want to avoid getting sucked into low-quality trades or landing up with a free jar of free lemon chutney when you purchase a hideous red plastic vase for half price at the supermarket, learn more by watching Dan Ariely on YouTube, where he discusses this subject at greater length.

Doug Goldstein, CFP®

The Case for Kosher Lab-Grown Meat

Wednesday, July 11th, 2012

According to a recent report, real progress is being made to generate lab grown meat that tastes as good as the real thing without all the cruelty, ghastly side effects, expense and waste of the present worldwide meat industry.

Dr Mark Post, whose lab at the University of Maastricht is experimenting with literally growing meat in Petri dishes, has told the Guardian: “We could be seeing a future where huge quantities of high-quality meat are gown in vats, incorporating not only muscle fibers but layers of real fat and even synthetic bone. In 25 years real meat will come in a packet labeled, ‘An animal has suffered in the production of this product’ and it will carry a big eco tax. I think in 50-60 years it may be forbidden to grow meat from livestock.”

Post is cited in a Grist article as stating something which should be of interest to us Kashrut observers:

“An animal does need to be killed to kick off the in-vitro process, but in theory, a single specimen could provide the seed material for hundreds of tons of meat.”

So, providing that the original specimen was kosher, isn’t this something we Orthodox Jews should welcome?

No one can say it is not acceptable. After all the Gemara tells us that R. Hanina and R. Oshaia spent every Shabbat evening studying the Book of Creation and as a result they were able to create a third-grown calf (comments: or a three year old, or a fat one) and ate it (Sanhedrin 65b).

So, if you could conjure up a living being from a Kabbalistic source book, then why not from a lab? Not only that, but given the halacha, shechita itself would not be necessary, because, purely following the letter of the law, if you kill a cow properly and then out comes a calf, you don’t need any further shechita to make it kosher.

Yet you can bet there will be opposition. Whenever anything threatens the Kosher Meat trade the Rabbis and Dayanim who live by it automatically cry “foul” because they will lose a major source of income. That also explains why those few rabbis who became vegetarians, like the Kamenitzer Maggid, or supported vegetarianism in principle, like Rav Kook, were excoriated and virtually written out of Haredi history.

But the point can be made that, since the Gemara says that the best way to celebrate Shabbatot and Chagim is with meat and wine, it would, it seems, be an offense against tradition to be a teetotal vegetarian – even if no one could point to an actually halacha against either.

Unlike my brother David, I am not a complete vegetarian, but I welcome the possibility of scrapping the meat trade. Indeed, I hope that when Elijah comes to earth he will tell us that in the Third Temple there will only be vegetarian offerings. I find the current situation unacceptable. We spend more money raising one beef animal than would feed an Indian village for a month. Most processes are offensive: the ghastly way most animals bred for slaughter are treated, the awful sights and smells hidden from consumers, the amounts of chemicals fed into animals reared for human consumption, not to mention the dangers of our modern diets. I am not opposed to eating protein but I’d be delighted if there were some way of doing it without subjecting animals to human cruelty.

Mind you, this is not an attack on Shechita. I have seen virtually all officially sanctioned methods of slaughter and I am utterly convinced that of all of them, Shechita, when carried out correctly, is the least painful and disturbing. But as Temple Grandin has shown emphatically, so much of the awfulness of slaughter has to do with the lead up, the corralling, the forcing of animals towards the fate they can smell and hear, not to mention so much cruelty involved in the rearing, the transportation and the preparatory processes of meat production. If only we could have the tasty protein without all that.

Let us assume that all the unemployed Shochatim could be trained to work in other areas of the kosher trade. Why do I still envisage opposition? One reason is simply the reluctance to countenance anything new or to allow science or modern values to challenge ancient traditions. A new concept of religious correctness is that ‘Masorah,’ the way we have always done things, trumps innovation. But there is in fact another issue and it is the tension that exists between the letter of halacha and the spirit.

This is not of course a halachic responsum, but it is conceptual analysis of why in our tradition there is an imperative to consider the careful treatment of animals and why this new development could be very significant and certainly should be welcomed.

The Torah commands us to sacrifice and the cohanim to eat meat. But it is also full of laws concerning animals: not killing a cow and its calf on the same day, not taking a fledgling or egg in front of the mother, not ploughing an ox with an ass together, not muzzling an ox while it threshes.

The rabbis are divided in their rationalizations. Some of course refuse to accept the idea of explanations altogether and emphasize only the significance of an act of obedience to a higher power. Some do indeed say it shows Divine mercy to creatures as a sign of greater mercy towards humans, and others do actually argue that the purpose of showing mercy to animals is to imitate Divine qualities of caring. Neither do I need to rehearse the laws of cruelty to animals, Tzaar Baaley Chayim and the Noachide Laws of “Eiver Min HaChay,” not taking a limb from a living animal. And yet too often one hears these ideas dismissed as figments of non-Jewish moral relativism. “The Nazis were kind to animals” or “Englishmen prefer dogs and horses to humans.”

There is indeed a massive challenge to reconcile caring for animals with the meat trade. And this where Meta Halacha plays an important part. Humans do indeed come first. But that does not mean we should not be concerned with animal welfare. Yet somewhere along the march of history we have lost the thread. Just look at how the custom of Shlogging Kapporas causes such cruelty and no one seems to care.

Take these two narratives about Rebbi Yehudah Hanassi in Bava Metzia 85a
Why did he suffer in life? A calf was being taken to the slaughter. It broke away, hid his head under Rabbi’s skirts, and began to howl. “Go,” he said “because you were created for this.”’ Then they said (on High) “Since he has no pity, let us make him suffer.”’

And why did his suffering end? One day Rabbi’s maidservant was sweeping the house; [seeing] some young weasels lying there, she was about to kill them. He said to her “Let them be, for it is written “ He extends his mercy to all of his creation.” Then they said “‘Since he is compassionate, let us be compassionate to him.”

You could not have a more explicit expression of the significance of the issue. And if this new method can in fact (and it still has some ways to go) change the way we get our meat, then all I can say Yishar Co’ach and Tavoh aleyhem beracha.

Jeremy Rosen

The Real Purpose of Boycotts

Wednesday, June 6th, 2012

Is the purpose of the calls for boycotts against Israel and its citizens a concern for the human rights or welfare of Palestinians, or actually a call ultimately to eliminate the state of Israel? If there were a real concern for the human rights of Palestinians, why are there not calls for a free Palestinian press, or for the release of journalists from Palestinian prisons, or for an end to the corruption in the Palestinian leadership?

Instead, these calls for boycott look suspiciously like a racist response to the existence of a Jewish state — as if most of its citizens were wearing a yellow Star-of-David in Nazi-like fashion, and deserved to be punished or eliminated. Even Noam Chomsky and Norman Finkelstein, well-known critics of Israel and pro-Palestinian activists, have characterized the boycott, divestment, and sanctions movement against Israel as “hypocritical,” and run by individuals who falsely claim to represent the Palestinian people.

Whether the calls for boycott are the product of leftist anti-nationalist posturing, antisemitism, or simple ignorance, is a matter of judgment. In their disingenuous nature they are simplistic responses to complex, unresolved problems that ignore the distinctions between diverse kinds of activities and issues, such as the different territories and populations, or how “appropriately” to defend oneself in the face of continued aggression. If the advocates for boycott do wish for peace, what they are proposing is actually counterproductive: they create an atmosphere in which calls for boycott have been, and are, an obstacle to the start of negotiations between the parties, and in which adversarial positions only become hardened even further as threats are seen to increase. There seems to be a cognitive dissonance, an inability among the boycotters, to distinguish between facts and the spun perception of them; or perhaps there is an indifference to facts, or perhaps there is a reluctance to place any facts at all in the context of the real, ongoing relationship between the disputing parties.

Boycotts of Jews and Jewish interests by Arab groups go back almost a hundred years, and have become more prominent with the declaration in December, 1945, of the newly formed Arab League Council of 23 countries. The declaration stated that, “Jewish products and manufactured goods shall be considered undesirable to the Arab countries.” Hypocrisy was present from the start. The Arab states were less interested in helping Palestinian Arabs than in preventing Jewish products from entering their own countries and competing with them.

This boycott, administered by the Central Boycott Office in Damascus, attempted to isolate Israel economically as well as diplomatically, and did administer some temporary harm to the economy of Israel after the state was established in 1948. In addition to the Arab states, some non-Arab businesses, among them Pepsi, McDonald’s and most Japanese car companies, abided by the boycott, but it was more honored in the breach than in the observance.

Since the 1980s a number of Arab states, starting with Egypt, and with the exception of Syria, have abandoned the boycott, wholly or in part, unable to ignore the new world of globalization, international trade, and binding international trade agreements, particularly that of the World Trade Organization. As a result, Arab countries, both through legal channels and clandestinely through third parties, have been trading with Israeli companies in a considerable fashion, including in irrigation, security systems, and high-tech components, and have accepted Israeli investment.

The boycott is still technically in force by Arab countries, though often bypassed, ineffective and negligible. Its intended impact is now less in economic affairs than in becoming a major polemical weapon in the hands of those non-Arabs who are critical of, or want to condemn, Israel — purportedly because of their opposition of Israeli settlements and their unwillingness to believe that, to the adversaries of Israel, it is regarded as one big settlement.

People can understand the politically motivated logic of Arabs, inside Israel as well as outside, calling for a ban on products made in Israeli settlements, including Ahava Dead Sea health products, Beigel and Beigel pretzels, Super Drink soft drinks, Oppenheimer chocolates, fruits, vegetables, computers, and many other products. It is an illustration of democracy in Israel — and revealing about those who do not wish Israel well — that a major advocate of the boycott is Ahmad Tibi, the Arab-Israeli deputy speaker of the Knesset.

Michael Curtis

The Fat Nanny State

Tuesday, June 5th, 2012


It’s easy to dismiss New York City Mayor Bloomberg’s latest nanny state hiccup as the control-freak antics of a powerful man –but that would be missing the point. Bloomberg did not come up with the idea of banning sodas during a spa session on his private island. His implementation of it may be more overtly obnoxious, but the idea that there is a national health crisis that can only be solved by getting people to stop eating sugary foods, is ubiquitous among social policy wonks and national experts on telling people what to do.

In 2007, a conference on obesity was held at George Washington University, sponsored by the Stop Obesity Alliance and the Obesity Association. The Stop Obesity Alliance may sound like a silly afterthought of a group, but its steering committee members include AHIP, the trade group for the health insurance industry; AMGA, the trade association for health care groups; SEIU, one of the largest unions in the country; and NBGH, a business health group representing major companies like Apple, FedEx, Kellogg, Unilever and Walmart.

It was no wonder then that virtually every Democratic and Republican candidate running for office either showed up in person, or sent a proxy to explain how their administration was going to fight obesity.

“The next president must commit to fighting America’s obesity problem and possess the experience to win the fight,” Governor Bill Richardson said, and vowed to make fighting obesity one of his top priorities.

You might be laughing, but don’t. The obesity epidemic buzzword has penetrated every major company, as well as every level of government and academia. That translates into a policy bulldozer with private-public partnerships that will control every aspect of your life.

When think-tanks convince corporations that they’re losing money because of obesity, they sponsor trade associations that invite politicians down to explain what they’re going to do about it. Health insurance companies have crunched the numbers and decided that they can save billions if the government manages to make people lose weight. Corporations that employ a lot of people and pay for their health insurance think they can save a fortune on health insurance if employee obesity is cut. They have their own employee incentives, but mostly they want the government to do something about it.

Why do you think the 2012 election came down to a race between ObamaCare and RomneyCare? Because the power players agree that we need national health care; they only disagree over what kind of national health care we need. Just like they agree that we need “immigration reform,” tolerance for Islam, and a War on Terror that doesn’t disrupt international trade. We don’t need those things, but they do, and they are determined to force them down our throats.

To understand the genesis of Bloomberg’s lunacy, you have to go back to groups like the Stop Obesity Alliance. And it’s not the only such group. There’s the Campaign to End Obesity, whose board includes executives from major health companies and non-profits, including Pfizer, Johnson & Johnson and Humana. Every time you hear another talking head going on about the dangers of obesity to America, he’s repeating talking points lifted from “F as in Fat: How Obesity Threatens America’s Future”, a report from the Robert Wood Johnson Foundation, the country’s largest health care foundation, which doles out 400 million dollars a year in grants. Its primary focus… obesity.

“F as in Fat” includes extensive material on government legislation, everything from soda taxes to menu labeling to “complete streets programs,” which New Yorkers will recognize as the melange of bike lanes that squeeze out cars; what they don’t know is that it is used to fight obesity. HR 1780: The Safe and Complete Streets Act is a congressional bill that would turn every city into the same nightmare of snarled traffic and no parking.

Around the same time that policy men and women were telling the Stop Obesity Alliance what they would do about fat people, there were warnings in the U.K. that obesity would bankrupt the NHS, and Australia’s Labor Party vowed to tackle the “national obesity crisis” as a study claimed that 95 percent of Australians were “unfit.” The hysteria is worldwide.

Daniel Greenfield

Printed from: http://www.jewishpress.com/blogs/sultan-knish/the-fat-nanny-state/2012/06/05/

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