Posts from Monday May 2 2011

Swiss freeze dictators’ funds

Bern has frozen SFr830m ($960m) of assets of former heads of state from the Middle East and north Africa since popular uprisings began earlier this year, Micheline Calmy-Rey, Switzerland’s foreign minister, said on Monday at a meeting of regional Swiss ambassadors in Tunisia, reports the FT. Her spokesman told Swiss news wires that the biggest single source, amounting to some SFr410m, stemmed from Hosni Mubarak, the deposed Egyptian president, his family and immediate circle. A further SFr360m was identified as stemming from the Gaddafi regime in Libya, a surprisingly high figure, considering Muammer Gaddafi’s declaration he had withdrawn all funds – amounting to some $5bn – from Switzerland after a bitter diplomatic spat two years ago. A further SFr60m in frozen funds were from Tunisia’s ex-president Zein al-Abidine Ben Ali and his family, she added.

Facebook hopes draw investors to Renren IPO

The strong interest in RenRen’s IPO stems from the fact that there is no major social media or social networking company open to public investment, writes the FT. With a Facebook IPO at least a year off, many investors are keen for a slice of “the Facebook of China”. The offering is set to price on Tuesday in the US and begin trading on Wednesday. Highlighting the success of the pitch to market Renren as a Facebook proxy, the price range was raised on Friday from the initial $9-$11 to $12-$14. That could increase the deal size to as much as $743m, from the $584m planned originally.

Golf course boom points to China corruption

In most countries, a proliferation of world-class golf courses would be regarded as an obvious and inevitable by-product of rapid growth and soaring living standards, the FT reports. In China, courses such as the 36-hole Qinghe Bay Country Sports Club, located within view of the Olympic Bird’s Nest stadium in Beijing, do indeed reflect surging private fortunes. But facilities such as this have also become a potent symbol of the hypocrisy and corruption inherent in Communist party rule. According to a central government edict issued repeatedly in recent years, the beautifully manicured lawns and sumptuous water features of Qinghe Bay are an illegal development – along with most other golf courses in the country.

Awkward questions loom for Pakistan

The killing of Osama bin Laden in a garrison city home to Pakistan’s top army staff college has posed embarrassing questions for the country’s military leadership, writes the FT. Barack Obama, US president, was careful to emphasise Pakistan’s co-operation in Sunday’s strike against Osama bin Laden but focus has intensified on bin Laden’s sanctuary close to a military cantonment two hour’s drive from the capital, Islamabad. The al-Qaeda leader’s refuge in the city of Abbottabad has highlighted fears about Pakistan’s ambivalence towards terrorism and its highly conflicted view of militancy. Such a conspicuous location, close to Pakistan’s equivalent of the UK’s Sandhurst military academy, also appears to confirm US secretary of state Hillary Clinton’s suspicions that top officials in Pakistan knew where bin Laden was hiding.

US equities and oil fall back from highs

Equities fell and the dollar strengthened in volatile trading following news early in the session that al-Qaeda leader Osama bin Laden had been killed by US forces in Pakistan, reports the FT. Markets have struggled to price in the impact of bin Laden’s death, with “safe haven” precious metals actually after news of the successful US military operation, despite the belief that the risk of terrorism may have lessened somewhat., but still ended the session weaker. Oil initially fell, then rose to new highs, and is now trending down again. Nymex WTI crude futures touched $114 a barrel, their highest level since 2008, but are now down 0.7 per cent at $113.12. Brent crude futures are also down 0.9 per cent at $124.74. Gold dropped sharply hours before the bin Laden news to near $1,540 an ounce, having reached a new all-time nominal record of $1,575 in early Asian trading. The price has rebounding after the bin Laden news broke, but in a late slide is down 1.1 per cent at $1,546. Silver also fell sharply from its near-record highs, though its tumble began before the bin Laden news. The move – a fall of more than 11 per cent – was said to be related to sharp increases in margin requirements for trading the precious metal. Silver is currently down 8 per cent at $43.98 an ounce.

US jubilant at bin Laden’s death

The killing of Osama bin Laden triggered jubilation among the US population and its national security establishment but has prompted warnings about potential revenge attacks by extremist supporters of the Saudi-born terrorist, the FT reports. The storming of bin Laden’s compound by US special forces in Abbottabad, 50km from the Pakistan capital, raised questions about the US ally’s commitment to combating international terrrorism. Some western commentators have called for the winding down of military operations in Afghanistan.

El-Erian: Implications for global markets of Bin Laden’s death

Mohamed El-Erian, chief executive and co-chief investment officer at investment fund PIMCO responds to Sunday’s news that Osama bin Laden, was killed near the Pakistani capital of Islamabad following a “targeted operation” by US forces.

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