china confidential
Tuesday, November 18, 2008
The Rise of the Shekel
Foreign Confidential....
Bloomberg reports on Israel's surprisingly hard currency, which in June of this year became one of 17 world currencies that can be traded in multi-currency banks.While Iran threatens to destroy Israel, militants in the Hamas-controlled Gaza Strip fire rockets into the country and corruption scandals forced the prime minister to resign, the shekel increasingly looks like a hard currency. Since Stanley Fischer, the former International Monetary Fund deputy director, became the Bank of Israel governor in May 2005, the shekel strengthened 12 percent against the dollar and the Swiss franc, 13 percent versus the euro, 3.1 percent against the yen and 41 percent compared with the British pound.
"The shekel is the safest asset in Europe, the Middle East and Africa,'' Merrill Lynch & Co. strategist Benoit Anne in London wrote in an Oct. 22 report. "The shekel presents some defensive characteristics, which has served the currency relatively well at a time of several global risk conditions.'' Merrill set its "medium-term'' fair value for the shekel at 3.37 to the dollar....
Investors are gaining confidence after Israel's economy grew an average of 6 percent in the past four years and inflation slowed to an annualized rate of 5.5 percent last month from as high as 486 percent in November 1984.
Israel's $206 billion economy will expand 4.5 percent in 2008, according to Central Bureau of Statistics estimates. That's faster than the 3.7 percent forecast for the world economy by the IMF in Washington. U.S. gross domestic product contracted at a 0.3 percent rate last quarter, the biggest decline since 2001, and will expand 1.4 percent this year, based on the mean estimate in a Bloomberg survey of 75 economists.
Click here to read the whole article.
Hijacked Saudi Oil Tanker Anchored off Somalia
Foreign Confidential....
A hijacked Saudi supertanker carrying two million barrels of oil is reported to have dropped anchor off the coast of Somalia. Pirates captured the vessel more than 800 kilometers off the coast of Kenya on Saturday. The company that owns the tanker says the 25 crew members are believed to be safe. Alisha Ryu reports from Nairobi that the ship's owner hopes to negotiate an end to the spectacular seizure.
The head of the East African Seafarers' Association in Mombasa, Kenya, Andrew Mwangura, says negotiations for the release of the $140 million oil tanker and its multi-national crew of 25 have begun. He says he expects the pirates to demand a far higher ransom for the release of the vessel than the $1.2 million the pirates have previously demanded from ship owners.
"We are informed that they are already in touch with the ship owner but we do not know who far they [negotiations] have gone," Mwangura says.
According to Mwangura and other maritime officials, the enormous weight of the cargo would have limited the 330-meter supertanker to a top speed about 14 knots - slow enough for armed pirates in fast attack boats to come alongside.
British maritime journalist David Hughes says although the newly-built Sirius Star sits higher in the water than older tankers, it would not have been difficult for experienced gunmen to board her.
Largest-Ever Hijacking
"The modern one is higher than an old one," he says. "We are talking 10 to 15 meters. Not easy. Still, you could get a ladder up."
The hijacking of the vessel, the largest ever taken by pirates, took place despite the presence of warships recently deployed by the United States, the NATO alliance and the European Union to protect one of the world's busiest shipping areas.
Many of the warships have been conducting their patrols in the narrow shipping lanes of the Gulf of Aden, where the number of successful piracy attacks on merchant ships have dropped significantly in the past month.
But Monday's attack occurred 830 kilometers off the coast of Kenya in wide open waters that navies cannot adequately cover. The United States' top military officer, Navy Admiral Michael Mullen told reporters that he was stunned by the pirates' ability to operate so far from shore.
Journalist David Hughes says the attack signals a potential catastrophe for the global maritime industry. "It means that nowhere from somewhere down the middle of the Indian Ocean and westward is safe," he said. "And that means you essentially cannot have normal merchant shipping in that huge area."
The U.S. Navy has not said whether it is considering taking military actions to rescue the tanker.Hillary Clinton for Secretary of State
Dateline USA....
As of this writing, President-elect Barack Obama is said to be seriously considering appointing his former rival, U.S. Senator Hillary Clinton, to one of the most important jobs in the country--Secretary of State.
It is a brilliant idea. Senator Clinton is a tough, hard-nosed realist with great intelligence and a firm understanding of world affairs. She is experienced, knowledgeable, respected across the land and overseas.
Cynics and critics who assert that Senator Clinton's husband, former President Bill Clinton, would be a detriment are totally wrong. Hillary is her own woman. She would have made a great President. She will make a great Secretary of State. Besides, Bill Clinton's expertise and insights would be welcome in these trying times.
Hillary for Secretary of State! Fantastic!
Wednesday, 19 November 2008
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