Monthly Archives: November 2012

EARNINGS ROUNDUP: SETTING THE STAGE FOR A FOURTH QUARTER PROFITS RECOVERY

Source ; Greg Harrison
November 19th, 2012

Analysts have trimmed their earnings outlooks so much that, they have set the stage for a return to respectable levels of earnings growth in the fourth quarter, especially among Consumer Discretionary stocks.

After S&P 500 companies reported third-quarter earnings that were largely flat over year-earlier levels, investors are looking forward to seeing a return to more normal level of earnings growth – and hoping that this will show up in the fourth quarter reports. Certainly, analysts are more optimistic about the final quarter of 2012 than they were about the third quarter, and currently are calling for fourth quarter profits to grow by 4.7%. Still, that’s half of what they were forecasting S&P 500 companies would earn this quarter only a month ago, so it’s worth pondering whether they will continue to cut estimates as we head toward the end of the quarter and the year as a whole.
The most recent decline in earnings appears to be a direct result of the guidance that companies themselves provided as they released their third-quarter results. As is evident from Exhibit 1, below, until companies began publishing negative guidance, the consensus estimate for fourth-quarter earnings growth hovered just below 10%. And since most of the guidance provided by S&P 500 companies this quarter has been negative, with 3.4 bearish preannouncements for every one that was positive, the result has been a slide in earnings growth forecasts. Still, as analysts lowered their estimates, companies began to shift toward positive preannouncements. The pattern in the third quarter was similar, as an unusually negative level of preannouncements caused the growth estimate to drop to the point that the number of earnings “beats” came close to what we are used to seeing in a typical earnings season. That caused the earnings growth rate to climb once more, and served as a sign that, at their current levels, analysts’ opinions are close to the internal forecasts of the companies themselves.

The recent increase in the proportion of guidance that offers an upbeat forecast is a good sign for investors who hope that the fourth quarter will mark a resumption of earnings growth. In a typical quarter, there are 2.3 negative preannouncements for each positive one. The more bearish ratio for the fourth quarter may be daunting on an overall basis, but when we turn our attention to individual sectors, there are some encouraging signs. In the Consumer Discretionary group, for instance, there are only 2 negative preannouncements for every positive one, and five of the six companies to have published a more optimistic outlook has done so quite recently – within the last two weeks. The negative to positive ratio for the fourth quarter is more negative, at 3.2. These companies also boast the strongest earnings growth record for the third quarter and appear likely to replicate that feat in the fourth quarter.
Within the Consumer Discretionary sector, positive preannouncements have come from brands like Leggett & Platt Inc (LEG.N) and Fossil Incorporated (FOSL.O) and smaller retailers like Dollar Tree Inc (DLTR.O) and GameStop Corp (GME.N). At the other end of the spectrum, however, some household names within the retailing sector are still warning that analysts’ estimates for their fourth-quarter are still too high. This group includes Macy’s Inc (M.N), Kohl’s Corp (KSS.N), and Target Corporation (TGT.N), which all have issued negative guidance over the past two weeks.
One reason to be wary about the magnitude of any earnings rebound in the fourth quarter is what is taking place in the Materials sector. After profits growth plunged 26.6% during the third quarter, analysts currently expect earnings for the group to rise by 2.2% this quarter. That turnaround is a major factor in the overall predictions of a growth in earnings overall – but companies are cautioning analysts about being overly optimistic: while five companies have published negative guidance, only one has suggested that earnings will beat expectations. This is a relatively small sample size when compared to other S&P 500 sectors, but it still makes up a significant portion of the Materials group.

With the improvement in analyst sentiment with respect to fourth-quarter earnings growth rates, it is reasonable to hope that this will lead to a stabilization in fourth-quarter earnings estimates, as well, after a month of consistent cuts by analysts. These analysts finally may have lowered estimates to the point where companies will be able to meet or exceed expectations, laying the foundation for a return to earnings growth after a weak third quarter.

Israel and Hamas Agree to a Cease-Fire, After a U.S.-Egypt Push

Thanks for NEW YORK TIME
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Source;
This article has been revised to reflect the following correction:
Correction: November 22, 2012
An earlier version of this article incorrectly stated that Nabil Shaath, the Palestinian Authority’s commissioner for international relations, had participated in the cease-fire talks.
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CAIRO — Under intense Egyptian and American pressure, Israel and the Palestinian militant group Hamas halted eight days of bloody conflict on Wednesday, averting a full-scale Israeli ground invasion of the Gaza Strip without resolving the underlying disputes.

With Israeli forces still massed on the Gaza border, a tentative calm descended after the announcement of the agreement. The success of the truce will be an early test of how Egypt’s new Islamist government might influence the most intractable conflict in the Middle East.

The United States, Israel and Hamas all praised Egypt’s role in brokering the cease-fire as the antagonists pulled back from violence that had killed more than 150 Palestinians and five Israelis over the past week. The deal called for a 24-hour cooling-off period to be followed by talks aimed at resolving at least some of the longstanding grievances between the two sides.

Gazans poured into the streets declaring victory against the far more powerful Israeli military. In Israel, the public reaction was far more subdued. Many residents in the south expressed doubt that the agreement would hold, partly because at least five Palestinian rockets thudded into southern Israel after the cease-fire began.

The one-page memorandum of understanding left the issues that have most inflamed the tensions between the Israelis and the Gazans up for further negotiation. Israel demands long-term border security, including an end to Palestinian missile launching over the border. Hamas wants an end to the Israeli embargo.

The deal demonstrated the pragmatism of Egypt’s new Islamist president, Mohamed Morsi, who balanced public support for Hamas with a determination to preserve the peace with Israel. But it was unclear whether the agreement would be a turning point or merely a lull in the conflict.

The cease-fire deal was reached only through a final American diplomatic push: Secretary of State Hillary Rodham Clinton conferred for hours with Mr. Morsi and the United Nations secretary general, Ban Ki-moon, at the presidential palace here. Hanging over the talks was the Israeli shock at a Tel Aviv bus bombing — praised by Hamas — that recalled past Palestinian uprisings and raised fears of heavy Israeli retaliation. After false hopes the day before, Western and Egyptian diplomats said they had all but given up hope for a quick end to the violence.

Tellingly, neither Israel nor Hamas was represented in the final talks or the announcement, leaving it in the hands of a singular partnership between their proxies, the United States and Egypt.

There were immediate questions about the durability of the deal. Hamas, which controls Gaza, has in the past not fulfilled less formal cease-fires by failing to halt all missile fire into Israel by breakaway Palestinian militants.

Neither side retreated from threats to resume the conflict if the deal fell through, and both said they had only reluctantly agreed under international pressure. In a televised news conference, Prime Minister Benjamin Netanyahu of Israel declared that some Israelis still expected “a much harsher military operation, and it is very possible we will be compelled to embark on one.”

But he said that in a telephone conversation with Mr. Obama earlier in the evening, “I agreed with him that it is worth giving the cease-fire a chance.” He added that he had reached an undisclosed agreement with Mr. Obama to “work together against the smuggling of weapons” to Palestinian militants, for which Mr. Netanyahu blamed Iran.

Khaled Meshal, Hamas’s top leader, thanked Iran for its military support in a triumphal news conference in Cairo. “This is a point on the way to a great defeat for Israel,” he said. “Israel failed in all its objectives.”

He suggested that the West had come to Hamas and its Islamist allies in Egypt pleading for peace. “The Americans and the Europeans asked the Egyptians, ‘You have the ear of the resistance,’ ” he said, using the term Hamas prefers to describe itself and other Palestinian militants fighting the Israeli occupation. “Egypt did not sell out the resistance as some people have claimed. Egypt understood the demands of the resistance and the Palestinian people.”

The agreement postponed the resolution of the most contentious issue: Israel’s tight restrictions on the border crossings into Gaza under a seven-year-old embargo imposed to thwart Hamas from arming itself. The one-page “understanding” regarding the cease-fire called for “opening the crossing and facilitating the movement of people and transfer of goods,” but it also said that “procedures of implementation will be dealt with after 24 hours from the start of the cease-fire.”

David D. Kirkpatrick reported from Cairo, and Jodi Rudoren from Gaza. Reporting was contributed by Fares Akram from Gaza, Isabel Kershner and Ethan Bronner from Jerusalem, Mayy El Sheikh from Cairo, and Rick Gladstone from New York.

This article has been revised to reflect the following correction:

Correction: November 22, 2012

An earlier version of this article incorrectly stated that Nabil Shaath, the Palestinian Authority’s commissioner for international relations, had participated in the cease-fire talks.

Page 2 of 2
But however fragile the cease-fire may be, the deal itself may be a turning point for Egypt’s Islamist leaders, in both their relations with the West and their role in the region. Since the ouster of Hosni Mubarak — a reliable ally of Washington and Israel — many in the West have been worried about how Egypt’s leaders might respond to the next confrontation that pits their allies in Hamas against Israel. As a leader of the Muslim Brotherhood’s parliamentary bloc, Mr. Morsi often railed against Israel’s occupation of the Palestinian territories and praised Hamas for rejecting the Western-backed peace process in favor of armed resistance.

Advisers to Mr. Morsi acknowledged that the latest Gaza battle had put them in a bind, caught between the electorate’s anger at Israel and Mr. Morsi’s own vows — to Egyptians and the West — to encourage peace in the region. “If he responds fully to public opinion, he risks what we have been trying to do for peace and stability in the region,” said a senior official, speaking on the condition of anonymity because of the delicacy of the talks.

When the test came, several American diplomats said, Mr. Morsi chose pragmatism over ideology, working closely with Washington to bring the antagonists to the table.

American officials and Mr. Morsi’s advisers, speaking on condition of anonymity, said both the Egyptian president and Mr. Obama had given the other room to manage the demands of their domestic constituencies. They spoke by telephone at least six times during the week of fighting, officials said. Mr. Morsi had looked past Mr. Obama’s repeated statements of support for Israel’s right to self-defense, while Mr. Obama did not object as Mr. Morsi publicly blamed the Israelis for both instigating the conflict and then using excessive force.

But behind the scenes, the Americans pushed the Israelis toward a truce and Mr. Morsi pressured Hamas, as the parties all acknowledged on Wednesday.

Essam el-Haddad, Mr. Morsi’s top foreign policy adviser, said, “I think that the United States from the first moments was trying to find an end to the bloodshed.”

“Yes, they were carrying the point of view of the Israeli side, but they were understanding also the other side, the Palestinian side,” he said of President Obama’s role. “The sincerity and understanding was really very helpful.”

Nabil Shaath, the Palestinian Authority’s commissioner for international relations, who was in Cairo during the early stages of the talks and met with key players, said the published agreement was intentionally kept “as vague and as general and as concise as possible to avoid problems and misunderstandings.”

Egypt’s role in the cease-fire remains unclear, Mr. Shaath said.

“How much Egypt can really take the responsibility of a total sealing of the borders not to allow a bullet to come through, above or below?” he said.

Although the memorandum of understanding did not clarify how Gaza’s borders might be opened, Egyptians, Israelis and Americans briefed on the talks said that Egypt had broached the possibility of expanding the traffic of people and goods at Rafah. Egypt has historically resisted a broader opening of the crossing, and Israel enforces its embargo on the other sides of Gaza, fearing that it would face an influx of refugees or end up with responsibility for the impoverished enclave.

Israel also fears that an open border crossing would become a conduit for weapons.

But the people briefed on the talks said the Egyptians were considering restoring something like a previous arrangement, under which the Palestinian Authority and the European Union would operate the border crossing to provide Israel and Egypt some measure of security.

The arrangement might also force Hamas and the Palestinian Authority to work together. Mr. Morsi’s advisers say they are intent on reconciling the rival factions.

After the agreement was announced, the White House said, Mr. Obama called Mr. Morsi and each thanked the other.

David D. Kirkpatrick reported from Cairo, and Jodi Rudoren from Gaza. Reporting was contributed by Fares Akram from Gaza, Isabel Kershner and Ethan Bronner from Jerusalem, Mayy El Sheikh from Cairo, and Rick Gladstone from New York.

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Private Equity Interest Shifts to Southeast Asia

Thanks for Wall Street Journal

Some of the world’s biggest private-equity firms have stepped up their presence in Southeast Asia this year, eager to benefit from the region’s growth. But even as the value of transactions surges, the region remains a tough place to make a deal.

One key reason: Valuations are rising quickly as competition heats up for assets. Companies, particularly those in Japan and Korea, are looking there for growth, more so as growth stalls in India and China, say bankers and deal makers. These buyers are often happy to pay more than private-equity investors.

“Our competition is very rarely private equity. Our real competition is strategic buyers,” as firms in similar industries are called, said Rodney Muse, managing partner of Kuala Lumpur-based Navis Capital.

Private-equity transactions in Southeast Asia have totaled $3.6 billion so far this year, up from $1.3 billion last year, according to data from the Centre for Asia Private Equity. This year’s figure includes a $1.7 billion buyout of snack-food franchises KFC Holdings (Malaysia) Bhd 3492.KU +0.25%. and QSR Brands Bhd 9415.KU +0.15%. by European private-equity firm CVC Capital Partners, which hasn’t yet closed.

Last month, U.S. private-equity firm Kohlberg Kravis Roberts KKR 0.00% & Co. opened its Singapore office, with co-founder Henry Kravis boldly announcing plans to invest more than $1 billion in Southeast Asia over the next five years.

Blackstone Group LP BX +0.68% also opened a Singapore office earlier this year, while Carlyle Group LP CG -0.82% recently closed its first Southeast Asia deal, an investment in Indonesian telecom towers operator PT Solusi Tunas Pratama SUPR.JK +0.56% for between $100 million to $150 million, according to people with knowledge of the deal.

Apart from intense competition, one of the most common complaints is that it remains difficult to find deals, not least because of the dominance of large, family-owned conglomerates in Southeast Asia’s economies. The number of smaller startups are low in comparison.

“The entrepreneurial segment of the economy [in Southeast Asia] is still small,” Sigit Prasetya, managing partner for Southeast Asia at CVC, said on a panel at the Asian Venture Capital Journal conference in Hong Kong last week. He added that because these large business groups have great access to capital from banks, they are also asking what else private-equity can bring beyond just capital.

That may be starting to change, as the second generation of these families is more receptive toward the operational expertise that private-equity firms can offer, said John van Oost, managing partner of Singapore-based, Yishan Capital Partners, a real-estate investment firm that specializes in investing in Southeast Asia.

For example, Yishan recently formed a joint venture with Indonesian industrial group Rodamas Group, whose businesses range from chemicals to food, to manage and develop logistics facilities in the country.

Working with interpreters Very much lost in translation

Nov 2nd 2012, 15:40 by S.A.P.

THANKS | SOUTH KIVU

IT’S a strange experience to travel with a personal interpreter. It’s a luxury, to be sure—one that I had never had before—but perhaps most necessary in the least luxurious settings. I met my interpreter in Baraka, in a town on the western banks of Lake Tanganyika. He’s an English teacher and a radio broadcaster there. His English skills are moderate; his French, excellent. We made do with a broken combination of both.

Tanganyika is beautiful, but South Kivu isn’t quite a tourism hotspot. Racked by conflict and besieged by militias, this small eastern province of the Democratic Republic of the Congo has experienced outsized pain. Its recent history has crippled its infrastructure. The province is profoundly underdeveloped: traveling just 50km can take up to five hours via various combinations of 4x4s, motorbikes, and old-fashioned hiking boots. (An unexpected river, too, might block your path.) My colleagues and I went to settlements in South Kivu to research the impact of repeated attacks.

The villages we visited were populated by people who spoke Bembe, a Bantu language. My interpreter spoke Bembe fluently. Not all of our interpreters did. Swahili, another Bantu language used as a lingua franca across much of eastern Africa, was sometimes used in Bembe’s place. Monolinguals were sent to my interpreter, bilinguals to the Swahili-speaking interpreter. The occasional French-speaker was interviewed by our Swiss colleague. (She prized those exchanges, a rare chance to speak directly with villagers.)

At the beginning of my first interview, my interpreter asked our villager if he was ready to speak. My ears perked up in an unusual moment. He used a word I knew: tayari, “ready”. Kannada, a Dravidian language spoken in southwestern India, uses the same word for “readiness”—probably borrowed from Arabic via Persian and Hindi. Bembe probably borrowed the word from Swahili, a language that has absorbed a great deal of Arabic vocabulary through centuries of trade. How wonderfully curious, I thought, that a Kannada-speaker from the United States would have this word in common with a Bembe-speaker from one of the most remote regions in the world. I felt inspired—perhaps this interpreter bit would turn out well after all.

My readiness ended there. It’s easy, I learned, to feel excluded from a conversation when working through an interpreter. Our experienced interpreters diligently translated sentences, allowing the speakers to direct the conversation. The impatient ones paraphrased, asking follow-up questions without translation, condensing five minutes of exposition into five sentences.

The topics of discussion were—to put it lightly—sensitive. It’s difficult enough to talk about rape and murder in English. In a Bembe village, through an interpreter? I wanted to convey compassion and empathy. What use is mere intonation when my words are meaningless? When I have no control over how my language, or my intent, or my concern would come across because my words weren’t my own? I knew, of course, that I’d never be able to understand the pain of war. But any mere attempt to understand was filtered by an emotionless team of interpreters scarred, too, by Congo’s wars. What was meant to be a set of careful, sensitive English-to-Bembe interviews became Bembe-only conversations deadened by familiar stories of violence. My pole sana, “I’m very sorry,” was wildly inadequate for anyone or anything in the villages. I never felt so far removed from anyone as I did on those days.

Our trip showed the difficulty of doing the sort of research required to understand the consequences of far-flung wars. More specifically, it underscored the disheartening reality of working with populations who speak relatively unknown languages: without the money and time required to learn languages like Bembe, these stories will always be a world apart. The danger is in allowing that distance to discourage research. Babel fishes are pipe dreams, especially for highly localised languages like Bembe. An interpreter was necessary in those parts. I needed mine. I wish I hadn’t.

Joint Press Statement between President Barack Obama and Prime Minister Yingluck Shinawatra

Source; THE WHITE HOUSE
Office of the Press Secretary
FOR IMMEDIATE RELEASE
November 18, 2012

Prime Minister Yingluck Shinawatra of Thailand and President Barack Obama of the United States of America met today at the Government House in Bangkok, Thailand, on the eve of the anniversary of 180 years of diplomatic relations between Thailand and the United States of America to chart the way for a deeper bilateral strategic partnership and enhanced regional cooperation.

The President expressed his appreciation for his audience with His Majesty the King of Thailand and conveyed his warmest wishes to Their Majesties the King and Queen and the Royal Family. He further reaffirmed the enduring U.S. support for democracy in Thailand and welcomed the Royal Thai Government’s commitment to strengthen Thailand’s parliamentary democracy. He emphasized that Thailand is America’s oldest treaty ally in Asia, and the two leaders agreed that this alliance is rooted in the shared commitment to democracy, rule of law, universal human rights, open societies, and a free market, which has bonded the people of the two nations closely together. Prime Minister Yingluck added that the 180 years of diplomatic relations between Thailand and the United States, first established by the 1833 Treaty of Amity and Commerce, is a partnership that has not only stood the test of time and proved beneficial to the two countries, but also has meaningfully contributed to the promotion of stability, prosperity, and the creation of jobs between both partners and the Southeast Asian region as a whole.

The two leaders welcomed the continuous high-level and multidimensional dialogue between Thailand and the United States, including the 4th United States-Thailand Strategic Dialogue in June 2012, Prime Minister Yingluck’s recent visit to the United States in September 2012 to attend the 67th Session of the United Nations General Assembly, the 2nd United States-Thailand Strategic Defense Talks in October 2012, and the visit of the United States Defense Secretary Leon Panetta to Bangkok on November 15, 2012.

Both sides agreed that these high-level dialogues are instrumental to the success of the multidimensional partnership between Thailand and the United States, which is reflected in the depth and diversity of cooperation on political, security, economic, technical, social and cultural, science and technology, and development issues. They highlighted the United States-Thailand Strategic Dialogue as the critical framework to shape the agenda for United States-Thailand relations, and welcomed the results of the 2nd United States-Thai Defense Strategic Talks, which ensured that bilateral defense cooperation complements existing cooperation in the political, economic and social development fields. In this connection, the two leaders further agreed that a Strategic Dialogue between the Ministry of Foreign Affairs and the Ministry of Defense of Thailand and the Department of State and the Department of Defense of the United States would provide a forum for enhancing partnership between the two countries.

The two leaders highlighted the Thailand-United States Creative Partnership, which connects universities, businesses, and other innovation sectors in both countries as a prime example of forward-looking cooperation between the two nations and a forum to expand new areas of cooperation. The Prime Minister stated that Thailand continues to welcome educational and people-to-people exchanges through various channels such as the Fulbright Scholarship Program and the Peace Corps, with the latter celebrating its 50th anniversary in Thailand this year.

The two leaders agreed that the upcoming 180th anniversary of the establishment of diplomatic relations is a timely opportunity to reinvigorate the United States-Thailand partnership to truly realize its strategic potential. The President expressed his appreciation for Thailand’s ongoing efforts to promote regional peace and prosperity, including through regional development projects, while the Prime Minister welcomed the constructive role of the United States in the region. Both sides agreed that comprehensive and multidimensional engagement with the region by the United States could help to further enhance peace, prosperity, sustainable development and people-to-people relations.

On defense cooperation, they welcomed achievements made through the annual Cobra Gold exercise, which now involves participants and observers from 27 countries, Thailand’s international peacekeeping operations in Darfur, and counter-piracy missions in the Gulf of Aden. President Obama looked forward to Thailand’s co-hosting of the ASEAN Regional Forum Disaster Relief Exercise with the Republic of Korea in 2013.

Prime Minister Yingluck welcomed the United States’ policy of forging a stronger partnership with the Asia-Pacific region and the support of the United States for ASEAN’s centrality in the region’s development and integration, especially through the United States’ engagement at the ASEAN-U.S. Summit and the East Asia Summit (EAS). President Obama noted the growing importance of the EAS as an important regional forum for Asia-Pacific leaders to discuss political and strategic issues. The two leaders reaffirmed their commitment to working together to promote practical regional cooperation, including through other regional multilateral organizations such as the ASEAN Regional Forum and the Asia Pacific Economic Cooperation (APEC) forum.

The two leaders acknowledged the importance of forging regional cooperation based on mutual respect, and of resolving disputes peacefully and in accordance with the universally recognized principles of international law. The two leaders noted progress achieved on a dialogue towards a Code of Conduct on the South China Sea under Thailand’s coordinatorship of the ASEAN-China framework. The Prime Minister commended the United States’ substantive engagement in the Lower Mekong Initiative, while the President reiterated continued U.S. support for the development of the Mekong sub-region, and in particular emphasized support for women’s empowerment as a pillar of the Lower Mekong Initiative. The two leaders welcomed the signing of the Memorandum of Understanding on Trilateral Cooperation between the United States Agency for International Development and the Thailand International Development Cooperation Agency to support human resources development in countries in the region.

The two leaders agreed that non-traditional challenges would require close cooperation between Thailand and the United States in addressing issues such as nuclear security, climate change, disaster relief, and wildlife trafficking, which have become of global concern. The leaders welcomed the outcomes of the Seoul Nuclear Security Summit, and pledged to continue working together to address nuclear threats, including through their participation in the Global Initiative to Combat Nuclear Terrorism. In this regard, the President congratulated Thailand’s announcement endorsing the Proliferation Security Initiative’s Principles of Interdiction.

President Obama and Prime Minister Yingluck agreed to strengthen joint efforts to combat transnational crimes, such as through anti-human trafficking, counternarcotics, and efforts to better secure borders, airports, and seaports. President Obama and Prime Minister Yingluck highlighted the importance of the joint partnership on public health, and the ongoing work to develop new vaccines for HIV and dengue fever as well as protection against pandemic threats like avian influenza and cooperation in combating multi-drug resistant malaria. Both leaders agreed that the partnership between Thailand and the United States would facilitate cooperation to overcome these transboundary challenges at both regional and global levels.

The President acknowledged Thailand’s role as a regional hub for ASEAN Connectivity and supported Thailand’s critical role in the realization of the ASEAN Economic Community (AEC). The two leaders welcomed plans to convene the Trade and Investment Framework Agreement (TIFA) Joint Council, which serves as a foundation for economic cooperation in this partnership. In this context, the two leaders agreed jointly to promote region-wide trade and investment, sustainable human development, economic opportunity for women, and people-to-people connectivity, including through the U.S.-ASEAN Five Year Work Plan. President Obama welcomed Thailand’s interest in the Trans Pacific Partnership (TPP) negotiations, which will be subject to Thailand’s undertaking of the necessary domestic procedures. The two leaders looked forward to reconvening the TIFA Joint Council as an important step to strengthen our trade ties and consult on the requirements for Thailand’s eventual participation in high-standard agreements, including the TPP.

Prime Minister Yingluck and President Obama agreed to continue the exchange of high-level visits between Thailand and the United States in order to sustain momentum and progress in the multi-dimensional cooperation between the two countries.

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Obama: Myanmar trip acknowledges progress to democracy BANGKOK

Source@Reuters

BANGKOK (Reuters) – U.S. President Barack Obama said on Sunday that his upcoming trip to Myanmar was not an endorsement of the government, but rather an acknowledgement of the progress it has made in moving towards democracy after decades of military rule.

“We understand it’s a work in progress,” he told a news conference in Thailand.

But he added: “I’m not somebody who thinks that the United States should stand on the sidelines and not want to get its hands dirty when there’s an opportunity for us to encourage the better impulses inside a country.”

Obama will on Monday become the first serving U.S. president to visit the country, also known as Burma.

Some human rights groups say the visit is premature because reforms have yet to be consolidated, but the White House has said Obama would press Myanmar’s reformist president, Thein Sein, both in public and in private to do more about ethnic violence and human rights abuses.

(Reporting by Matt Spetalnick, Jeff Mason, Amy Sawitta Lefevre and Paul Carsten; Writing by Alan Raybould; Editing by Robert Birsel)

Facebook Clears The Air On News Feed, Promoted Posts

Source;
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Tomio Geron, Forbes Staff
Covering social, start-ups and venture capital.
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Who sees what on Facebook‘s News Feed and why? There has been recent controversy over Facebook’s News Feed and Promoted Posts, with some such as Mark Cuban and George Takei complaining about having to pay (or pay too much) to reach their fans of their Facebook Pages.
To clarify the situation, Facebook executives met with the media to explain how the News Feed and Promoted Posts work at the company’s Menlo Park, Calif. headquarters.
There’s a range of content that people can see on the News Feed: “relationship stories,” such as “Bob married Jane”; games content such as “Joe reached a new level in FarmVille”; or content from brand Pages. Because there’s so much content, people do not see it all. Facebook’s algorithm analyzes the content and determines what is most relevant to each individual. Facebook makes changes to this algorithm frequently, at least every week, said Will Cathcart, News Feed product manager at Facebook.
Facebook’s algorithm takes into account a number of factors to determine whether a person will see the content, including how a person reacted to that type of content in the past. For example, if a person click on a game content post in the past then that person will see more of that in the future. In addition, it takes into account how a person will react to a certain person. If a person complained or clicked to hide a story from that person before, it may not show up. Also the algorithm analyzes how have other people reacted to that particular piece of content. If many people have Liked or commented on a post, then it could show up more. ”We’re trying to make News Feed have the best content for users. We’re trying to give control. What’s really exciting for us is to get people to consume as much content as they want to,” Cathcart said.
Recently Facebook made a bigger change to to its algorithm to take into account complaints about items in the News Feed. After that change, engagement went up and complaints went down significantly–in the double digit percent range. That change included all kinds of content: from Pages as well as other posts. But the median reach of content from pages was relevantly unchanged, Cathcart said. In other words the average page on Facebook did not see much change. However, the change impacted different pages differently. So pages that had content with more engagement got seen more and pages with less engagement got seen less.
Facebook has a separate algorithm for its Promoted Posts ad product, which launched in January. It’s one of a number of products that the company has launched to boost revenue post-IPO. This is the product that businesses can use to pay to make sure that people see their posts–which otherwise would not be seen through the “organic” free method of posting from a page. In other words, businesses can turn a regular post into a News Feed ad. But how many they reach and how much it costs depends on the type of post and how big of a fan base the company is trying to reach through the company’s targeting tools. “We received significant adoption among small businesses. Several hundred thousand have used it,” said Matt Idema, product marketing director for ads at Facebook. Many using the proudct are new advertisers on Facebook and a “significant percentage” used it over and over again, Idema said. A number of factors affect how much the promoted post is seen. The most important factor is how it has performed over time.
The upshot is that brands can still pay to access fans of their Facebook pages but they’ll have to pay to reach them all. Some may have assumed that they could reach all their fans no matter through a Facebook post for free. But because there is so much content going through Facebook, they’ll have to pay.

Terrorists Can Take Down an Entire City’s LTE Network for Just $650

Thanks for the more informations;
Jesus Diaz

According to a critical document filed with the National Telecommunications and Information Administration, you can take down any LTE network with a simple $650 piece of gear.
Every cellphone grid is vulnerable to this technique, including FirstNet, the emergency communications network designed after 9/11. According to the authors, “it’s relatively easy to do” by anyone. In fact, if a terrorist group spent just a bit more on a cheap, readily available power amplifier, it could take down a region as large as New York State.
The paper, by Jeff Reed—director of the wireless research group at Virginia Tech—and research assistant Marc Lichtman, says that it would be hard to defend against such an attack. The problem, they say, relates to structural, intrinsic vulnerabilities to the LTE architecture.
According to Lichtman, there are eight distinct ways to take down an LTE network, easily be exploited by anyone with basic communications engineering skills:
Your phone is constantly syncing with the base station. If you can disrupt that synchronization, you will not be able to send or receive data. There are multiple weak spots-about eight different attacks are possible. The LTE signal is very complex, made up of many subsystems, and in each case, if you take out one subsystem, you take out the entire base station. Any communications engineer would be able to figure this stuff out.
The NTIA and the big telecommunication providers haven’t reacted to the paper yet. The good news is that the existing 3G and 2G grids would still work in such a scenario. However, as we are increasingly dependent on higher data rates and migrating to faster and better networks, such structural problems are worrying. Extremely worrying, in fact: by 2017, half of the world’s population will run on LTE, and new devices—some of them critical, in the medical and transportation industries—will be based solely on this standard.
The worst part: LTE has been proposed for the new communication system for emergency response. Called FirstNet, it was designed after the many communications problems experienced by first response teams during 9/11. Just imagine the picture: terrorists first attacking a major target and then jamming the communication network used by the emergency forces trying to help. According to Reed, this is specifically what can happen.
And there doesn’t seem to be a fix right now. This is an systems architecture problem, according to Reed, one that would take a massive rethinking to prevent:
LTE does a good job of [encrypting the communications]. But unconventional security aspects, such as preventing signal jamming, have been largely overlooked.
Not good. Not good at all. [Technology Review via Technology Review]
View on gizmodo.com

Developing Asia is dominated by populous countries that rely increasingly on domestic demand to drive their economies

Asian economies
Asia’s great moderation
Some of the world’s stablest economies are Asian. Time to worry?

By ; The Economist

Nov 10th 2012 | HONG KONG | from the print edition
LAOS, a poor country of 6m people wedged between Vietnam and Thailand, has no openings to the sea and few routes to world attention. But it is now enjoying a rare moment in the sun. Last month it won approval to join the World Trade Organisation. This week it hosted the ninth Asia-Europe meeting, which brings together leaders from the world’s most and least dynamic regions. Its small economy, which exports gold, copper and hydropower, is distinguishing itself. Its growth rate is not only one of the fastest in the world but also one of the steadiest.

In this section
»Asia’s great moderation
Desperately seeking yield
The OECD’s forecasts
Charged atmosphere
Where others fear to tread
Crisis in ratings land?
Keep digging
The X factor
Old-fashioned but in favour
Strength in numbers
Reprints
Related topics
G7 (Group of Seven)
Hong Kong
Asia-Pacific markets
Financial markets
World markets
From 2002 to 2011 growth fluctuated within a remarkably narrow range, never falling below 6.2% and never rising above 8.7%. Only three countries have recorded a steadier growth rate (as measured by its standard deviation) over that period. Two of them are also Asian: Indonesia and Bangladesh. Growth in developing Asia is now steadier, as well as faster, than growth in the “mature” economies of the G7 (see chart 1). It was more stable in 2002-11 than over any other ten-year span since 1988-97.

The “Great Moderation” is the name given to the era of economic tranquillity that prevailed in America and elsewhere in the rich world before the financial crisis. Should the label now be applied to Asia?

Asia’s economies are better known for their speed than their stability. From 1996 to 1998, for example, growth in five big South-East Asian countries (Indonesia, Malaysia, the Philippines, Thailand and Vietnam) swung from 7.5% to minus 8.3% as the Asian financial crisis struck. Even now some highly open economies, such as Thailand, Singapore and Taiwan, remain more volatile than the global average. Exposed to international trade flows, their industrial output fluctuates like a twirling ribbon with every twitch of demand.

But developing Asia (which excludes rich economies like Hong Kong, Singapore, South Korea and Taiwan) is dominated by populous countries that rely increasingly on domestic demand to drive their economies. Household consumption contributed half of the growth of just over 6% Indonesia enjoyed in the year to the third quarter (its eighth consecutive quarter of growth at that pace). Exports have fallen from about 35% of GDP ten years ago to less than a quarter in 2011. Developing Asia’s combined current-account surplus, which reflects its dependence on foreign demand, more than halved from 2008 to 2011 and is expected to fall further this year.

Asia’s stability also owes something to demand management. During the Asian financial crisis policymakers faced a dilemma. They could defend their exchange rates by raising interest rates. But that would cripple borrowers. Or they could let their currencies fall and ease rates. But that would inflate the burden of foreign-currency debt, crippling borrowers too.

In the aftermath of the crisis the region worked its way out of this trap. Most countries accumulated an impressive stock of hard-currency reserves and weaned themselves off foreign-bank loans in favour of foreign equity and local-currency bonds. Because these liabilities were denominated in their own currency, they did not rise in value when the currency fell.

That has freed policymakers to cut interest rates when the economy slows. Indonesia’s central bank, for example, slashed rates by three percentage points from December 2008 to August 2009. It cut rates by another point from October 2011 to February 2012. Thanks in part to its responsive central bank, Indonesia’s year-on-year growth rates over the past 20 quarters have been the most stable in the world.

Wise monetary policy was also one of the reasons cited for the Great Moderation enjoyed by the G7 economies. Another was the supposed depth and sophistication of the rich world’s financial systems, which, it was said, allowed households to smooth their spending, firms to diversify their borrowing and banks to unburden their balance-sheets. Both of these pillars of stability proved false comforts. Economists had not quite settled on an explanation for the Great Moderation before it inconveniently ceased to exist.

Worryingly, Asia’s great moderation has also been accompanied by sharply rising credit. According to Fred Neumann of HSBC, leverage is now higher than at any time since the Asian financial crisis (see chart 2). This credit expansion may represent healthy “financial deepening”, which many economists believe is a cause of growth and stability. But rising leverage can also be a threat to stability. The late Hyman Minsky, among others, argued that drops in volatility allow firms and households to borrow more of the money they invest. Stability, in Minsky’s formulation, eventually becomes destabilising. Overleverage does not require excessive optimism, merely excessive certitude; not fast growth, merely steady growth.

Fortunately, Asia’s policymakers never shared the West’s faith in self-correcting financial systems. The region has pioneered “macroprudential” regulations, designed to curb excessive credit and capital flows even without raising interest rates. In March, for example, Indonesia tightened loan-to-value ratios on mortgages and imposed minimum downpayments on car and motorbike loans.

Mr Neumann is, however, sceptical that regulatory tightening can substitute for the monetary kind. Macroprudential controls are not watertight, he notes. As long as capital remains cheap, money will leak. If the regulator lowers mortgage loan-to-value ratios, for example, banks may simply raise the appraised value of a home. If regulators impede foreign purchases of property, as Hong Kong just did, foreigners will seek inventive ways around the rules.

Hong Kong’s freedom to raise rates is constrained by its currency’s fixed link to the dollar, one of the few pegs to survive the Asian financial crisis. Other central banks do not have that excuse. Currency flexibility has given them the freedom to cut rates when growth slows. It should also allow them to raise rates when financial excess threatens—even if rates remain near zero in America, Europe and Japan. If stable growth allows lenders or borrowers to become overstretched, it can “sow the seeds of its own destruction”, Mr Neumann argues. Nothing great about that.

Climate Change Killed Off The Mayas

Much has been made of the so-called 2012 Mayan apocalypse. But for the real Maya people, the end of the world came slowly and timed with historic droughts.

A new, ultra-detailed climate record from a cave in Belize reveals Classic Maya civilization collapsed over centuries as rain dried up, disrupting agriculture and causing instability that led to wars and the crumbling of large cities. A final major drought after the political collapse of the Maya may be what kept the civilization from bouncing back.

“Even fairly subtle shifts initially in climate toward drying appear to have pretty significant ramifications for the social and political fabric of the Maya world,” said study researcher Douglas Kennett, an environmental anthropologist at Pennsylvania State University.

The end of the Maya

Kennett and an international group of colleagues — including climate scientists, archaeologists and experts in Mayan writing — are not the first to suggest dry spells brought about the end of the Maya. The Maya lived across southern Mexico and northern Central America; at their height during the Classic Maya period from about A.D. 300 to 1000, they gathered in complex cities of up to 60,000 people. They built stone monuments, water-storage systems and a complicated astronomical calendar, which has been widely misinterpreted to predict the end of the world this December.

Researchers have used geological records of climate from lake sediments to uncover evidence of drought, but the new study uses a cave formation to trace a 2,000-year history of rainfall in more detail than ever before. Researchers removed a stalagmite from the ground of the cave in a layer that sits close to a number of Classic Maya settlements. This stalagmite had been growing slowly but continuously from 40 B.C. to A.D. 2006. [10 Ways Weather Changed History]

Stalagmites form from calcium carbonate and other minerals left behind when drips of water move through a cave and evaporate. Researchers can use uranium-thorium dating (based on those radioactive elements’ rates of decay) to peg down the age of each layer of a stalagmite. They also can use isotopes, or variants of chemical elements, to determine how wet it was when each layer was laid down. (Heavy rainfall carries different isotopes than light rain does.)

Drought and instability

By analyzing the stalagmite, researchers were able to pin down rainfall levels twice a year for 2,000 years. They found that during the early period of Classic Maya civilization, this region of the world was abnormally wet. Abundant rainfall would have favored the expansion of the Maya’s empire, Kennett told LiveScience. And sure enough, wet periods in the climate record coincided with eras of expansion, building and stone monument construction according to the archaeological record. [Images: Stunning Maya Murals]

After about A.D. 660, however, things began to change. The overall climate started to get drier, with more frequent short-term droughts.

“That’s when you also start seeing some indications that there are stresses in the overall system,” Kennett said. War became more frequent, and some cities began to collapse as people moved out of population centers. It was the beginning, Kennett said, of what looks like a two-stage collapse.

The last gasp

By between 820 and 870, the Maya were struggling to get by on 40 percent less rainfall than before the drying period, the researchers report in Friday’s (Nov. 9) issue of the journal Science. This period, known as the Terminal Classic, was less stable than ever before. People began abandoning cities. Building campaigns ceased. Fewer and fewer stone monuments were erected.

“It’s not all at once,” Kennett said. “It’s an asynchronous thing. It’s happening over a couple of centuries.”

After major political systems failed, smaller agricultural communities survived into the 1100s and 1200s, Kennett said. It may have been a second phase of collapse that prevented these small groups from rebuilding their once-great civilization. Between about 1020 and 1100, the researchers found, there was an enormous, crippling drought — the biggest in the entire 2,000 years of the cave record.

“Political systems fail, but then usually something comes back and sometimes they’re even bigger, more integrated. That’s a pattern you see,” Kennett said. “That just doesn’t really happen in the Maya region.”

The droughts were an example of climate change driven by natural cycles, Kennett said. (Other research has suggested the Maya exacerbated the problem by deforestation and other activities.) The Maya may have been driven by fluctuations in the intertropical convergence zone, a climate zone that sits along the equator. When the zone is positioned farther north, you get wetter conditions in Central America, and when it moves more southerly, rainfall dries up.

The dry periods and droughts would have set the stage for the mysteriously abandoned cities the Spanish found when they arrived in the region in the 1500s, Kennett said.

“That’s part of the fascination, I think, with the Maya,” he said. “You have these elaborate cities with stone monuments, with a calendar system and a sophisticated hieroglyphic writing system, and then that just goes away.”

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