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Business this week: 25th November – 1st December 2006

November 30, 2006 Leave a comment

Business this week

Nov 30th 2006
From The Economist print edition

The weakness of the dollar came under the spotlight as it continued to slide, reaching a 20-month low against the euro and falling against other leading currencies. In an effort to soothe markets, Ben Bernanke, the chairman of America’s Federal Reserve, tried to dampen speculation that interest rates would be cut next year in order to boost economic growth, which would put more pressure on the greenback. The currency fell further after he spoke. See articleE+

The slack dollar was one factor that led stockmarkets to shed some of their recent gains. On November 27th the Dow Jones Industrial Average and the NASDAQ witnessed their sharpest declines since the summer, falling by 1.3% and 2.2% respectively. Asian markets also caught the jitters and the next day Hong Kong‘s Hang Seng index fell by its largest amount since September 11th 2001.

Ford said it was seeking to raise $18 billion in loans. Because of the carmaker’s poor credit-rating it will, for the first time in its history, put up its factories and other assets as collateral. The company, which is restructuring, has lost around $7 billion so far this year as its share of the American market continues to erode.

Bharti, an Indian conglomerate, confirmed it would work with Wal-Mart in a joint venture to open hundreds of Wal-Mart franchised stores in India, starting next year. It is the biggest push yet by a foreign shopkeeper into India’s booming retailing sector, which remains largely closed to foreign investment.

Iberdrola, a Spanish energy company, offered to buy Scottish Power for £11.6 billion ($22.5 billion). The friendly deal is the latest effort among big European utilities to consolidate ahead of next year’s deregulation of energy markets. However, some deals remain mired in political wrangling. This week the European Commission criticised Spain, again, for the conditions it has attached to a bid for Endesa, the country’s biggest utility, from Germany‘s E.ON. Spain wants Endesa to merge with Gas Natural, the country’s biggest gas supplier. See article

Ryanair raised its stake in Aer Lingus, its Irish compatriot, to more than 25%. Ryanair, Europe‘s biggest low-cost carrier, launched a hostile takeover for Aer Lingus in October, soon after Aer Lingus made its stockmarket debut, but has failed to win the support of big shareholders. A rival bid is improbable, given that the Irish government insists it will not sell its 25.4% stake in Aer Lingus to anyone.

The management of Eurotunnel, the operator of the tunnel that links Britain and France, breathed a sigh of relief as the company’s core creditors voted (by a slim margin) in favour of a restructuring plan. Some of the debt-holders, including several hedge funds, abstained from the vote. They, and smaller bondholders, remain unhappy with the blueprint, which restructures Eurotunnel’s £6.2 billion ($12 billion) debt, because it undervalues their investments.

EMI’s share price surged as the music company confirmed it had been approached about a possible takeover, reportedly by two private-equity firms. Merger talks between EMI and Warner Music proved fruitless earlier this year.

The retrial of Josef Ackermann and five others on criminal charges stemming from the awarding of executive bonuses at Mannesmann in 2000 ended when the judge accepted a settlement from the prosecution. The deal requires Mr Ackermann, who is now chief executive of Deutsche Bank, to pay euro3.2 million ($4.2 million) but without admitting to wrongdoing. See article

Sales of existing homes in America increased by 0.5% in October compared with the previous month, the first time sales have risen since February, according to the National Association of Realtors. But the median price for a home remained $221,000, a drop of 3.5% compared with a year ago. It may be a buyer’s market for some time to come: the inventory of unsold homes was also up sharply.

The European Union’s trade commissioner, Peter Mandelson, proposed a meeting of the world’s trade ministers before the end of the year in an attempt to revive the Doha round of talks. American officials backed away from the idea and said they preferred the “quiet conversations” going on in a series of smaller, informal meetings.

The OECD issued its latest economic outlook. The forum for 30 industrialised countries said a “rebalancing” in the world’s economy will see growth in Europe and Asia compensate for a slowdown in America. The OECD cut its estimate for GDP growth in the United States to 2.4% in 2007 from the 3.1% it forecast six months ago.

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Politics this week: 18th – 24th November 2006

November 24, 2006 Leave a comment

Pierre Gemayel, Lebanon’s minister of industry and a member of a famous Christian political dynasty, was shot dead in Beirut, inflaming sectarian tensions. The Lebanese army took to the streets while the country observed three days of mourning. Many fingers pointed at Syria, but Damascus strongly denied any involvement. See article

Syria and Iraq agreed to restore diplomatic relations after a break of 24 years. The charm offensive by Syria, long suspected of stirring turbulence in Iraq, followed a visit by its foreign minister to Baghdad, the first by a senior official since the toppling of Saddam Hussein. Meanwhile, Iraq‘s president planned a visit to Iran. And George Bush said he would travel to Jordan next week to meet Iraq‘s prime minister.

A new UN report noted that this year more than 2m Africans will die of AIDS, nearly three-quarters of all the AIDS-related deaths on the planet. See article

The Supreme Court in Kinshasa, Congo‘s capital, was set on fire by supporters of Jean-Pierre Bemba, the losing candidate in last month’s presidential election. Mr Bemba had asked the court to rule that the victory handed to Joseph Kabila was unfair. See article

A French judge said that Rwanda‘s president, Paul Kagame, should be put on trial for allegedly orchestrating a plane crash in 1994 that killed his predecessor, Juvénal Habyarimana. The incident marked the beginning of the genocide there. Rwanda‘s government said the French claim was baseless.

Responding to an order to clamp down on a spate of kidnappings in Nigeria‘s Delta region, the country’s army carried out an operation to free seven foreign workers who had been captured from a ship. One British hostage and two kidnappers were killed.

Mexico’s president-elect, Felipe Calderón, unveiled his economic team, naming Agustín Carstens, a former IMF official, as finance minister. Earlier, Andrés Manuel López Obrador, the narrow loser of last July’s presidential election, proclaimed himself the “legitimate” president at a rally of tens of thousands of his supporters.

Six of the nine elected regional governors in Bolivia said they were breaking relations with Evo Morales, the socialist president, over a bill that would allow the central government to scrutinise their funds and the Congress to sack them. The opposition walked out of the Senate in protest over that, land reform and other measures. See article

Nicaragua‘s outgoing president signed into law a measure outlawing all abortions, including when a woman’s life is in danger. Chile‘s Congress rejected a bill that would have legalised abortion in some circumstances.

AP
AP

The Dutch election produced an inconclusive result, but it gave the ruling Christian Democrats under the outgoing prime minister, Jan Peter Balkenende, the most seats. Mr Balkenende must now scrabble around for coalition partners; the negotiations could take months. See article

Allegations continued to fly that Russian intelligence agents had poisoned a renegade comrade who defected to Britain. Alexander Litvinenko remained in intensive care in a London hospital after his apparent poisoning. Several prominent critics of the Kremlin have been poisoned or shot in the past few years. See article

Italy‘s government sacked the chiefs of all three of its intelligence agencies. The cause was apparently the involvement of one agency in a CIA kidnapping of a Muslim cleric in Milan some years ago; but others said the spies were not proving loyal to Romano Prodi’s centre-left government. See article

The European Union gave Turkey a deadline of December 6th to open its ports and airports to Greek-Cypriot ships and aircraft, but Turkey has already said it will refuse. The likely outcome is that those chapters in the EU accession negotiations with Turkey relating to trade and free movement will be frozen.

In Poland, 23 miners were killed in a gas explosion at their mine in the Silesia region. It was the country’s worst such disaster since 1979.

In the United States the Democrats continued to put their new leadership team in place but insisted they were still united after rejecting John Murtha for majority leader in the House of Representatives, choosing Steny Hoyer instead. Mr Murtha was championed by Nancy Pelosi, who will become speaker when the new Congress starts in January.

Rupert Murdoch made a rare apology and agreed that the decision of his company to publish a book by O.J. Simpson recounting hypothetical details of the murder of his ex-wife and her friend was “an ill-considered project”. The book has now been scrapped and a television interview cancelled after a backlash. See article

NASA scientists conceded that they had probably lost the Mars Global Surveyor in space. The probe, launched ten years ago, has been one of the most successful missions run by America’s space agency, photographing Mars in unprecedented detail.

AP
AP

The government in Nepal signed a comprehensive peace agreement with the country’s Maoist rebels. On paper, this brings an end to ten years of conflict. Maoist fighters started arriving at the cantonments where they are to be confined. See article

Marking a visit to Delhi by the Chinese president, Hu Jintao, India and China signed a raft of mainly trivial agreements. The two countries said they would try to double their bilateral trade by 2010.

In Washington, DC, the Senate approved controversial legislation that would open the way to nuclear co-operation with India, despite its having tested nuclear weapons and never having signed the non-proliferation treaty.

In Hanoi, leaders of the Asia-Pacific Economic Co-operation (APEC) forum held their summit and made their usual vague commitments to freer trade. George Bush discussed North Korea‘s bomb with his Russian, Chinese and South Korean counterparts.

Correction: Last week we erroneously reported that the summit George Bush was headed to in Hanoi was being held by ASEAN. Sorry for the confusion.

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Business this week: 18th – 24th November 2006

November 24, 2006 Leave a comment

The London Stock Exchange rejected a second takeover bid by the American NASDAQ exchange. The LSE said the new £2.7 billion ($5.1 billion) offer still “substantially” undervalued it, and spurned a proposal for further talks. After NASDAQ revealed it had increased its stake in the LSE to almost 29%, attention turned to the Americans’ chances of getting the LSE‘s biggest investors to support their offer. See article

Tributes were paid to Milton Friedman, who died on November 16th, aged 94. The American economist, a champion of free markets, laid the intellectual foundations for the ending of the post-war Keynesian consensus. Mr Friedman urged governments to cut spending and privatise state services, but gave warning that “Hell hath no fury like a bureaucrat scorned.” See article

America’s treasury secretary, Hank Paulson, gave a speech in which he called for balance in regulatory oversight of capital markets. Mr Paulson said that legislation should not be “excessive” or impose “needless costs”, but he stopped short of calling for an overhaul of Sarbanes-Oxley rules, which critics say are intrusive. See article

A fight broke out for control of ITV, Britain’s biggest commercial broadcaster. BSkyB, a pay-TV channel that is part of Rupert Murdoch’s empire, bought a 17.9% stake in ITV, which was interpreted as an attempt to stymie a £4.7 billion ($8.9 billion) merger bid from NTL, a cable and phone operator in which Sir Richard Branson is the largest shareholder. Sir Richard called on regulators to intervene in what he fumed was BSkyB‘s “blatant attempt to distort competition”, but ITV rejected NTL‘s offer as too low. See article

In a significant step towards an accommodation between newspapers and internet companies in lucrative classified advertising, several firms representing 176 newspapers in America reached a partnership with Yahoo! to share content and advertising online.

Google’s share price continued to rise and pushed past $500 for the first time. The share price has gone up by around 40% since February, when investors took fright at negative reports about future growth. Google now has a market capitalisation of some $155 billion, more than eight times that of General Motors.

General Motors’ share price came under pressure as it emerged that Kirk Kerkorian has cut his stake to 7.4% from 9.9%. Mr Kerkorian recently failed to persuade GM to create an alliance with Renault and Nissan and remains critical of GM‘s own blueprint to restructure its business.

Hot on the heels of last week’s $26.7 billion agreement to buy out Clear Channel Communications, a radio and outdoor-advertising company, the rush for big private-equity deals continued. In the largest-ever leveraged buy-out, Blackstone continued its property-acquisition spree by offering $36 billion for Equity Office Properties, America’s biggest real-estate investment trust. It also emerged that Australia‘s Qantas Airways had been approached about a potential buy-out, said to value the airline at around A$11 billion ($8.5 billion). See article

Mining and metals firms also had an acquisitive week. Freeport-McMoRan secured a $25.9 billion deal for Phelps Dodge, a bigger mining rival which failed to cement an ambitious three-way merger with Inco and Falconbridge earlier this year. And in the largest investment by a Russian firm in America, Evraz, a steel group controlled by a Russian oligarch, Roman Abramovich, said it was buying Oregon Steel Mills for $2.3 billion.

CSN, a Brazilian steelmaker, approached Corus, an Anglo-Dutch rival, about a takeover. The move puts pressure on India’s Tata Steel to raise its recent offer for Corus. See article

The planned merger between Gaz de France and Suez was thrown into doubt again when the French courts said the deal could not be completed until workers facing privatisation at GDF had had more time to consider the agreement. The combination of the two utilities has been mired in controversy since the French government unveiled the plan in February.

Markets responded positively as the Ifo institute’s index of German business confidence, seen as an indication of future growth in the euro area, reached a 15-year high.

Construction started on new homes in America at an annual rate of 1.49m in October, the lowest level for six years. The rate was 27% below October 2005—the biggest year-on-year decline since March 1991 (the housing market’s slump has been blamed for weak growth in the third quarter). Meanwhile, the White House lowered its GDP growth forecast for 2007 to 2.9%.

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Web 3.0; Valleywag Fired; 2008 Prez Watch

November 17, 2006 Leave a comment

It was a rough week for Web 2.0. Bloggers like Rough Type declared Web 2.0 sooo over following a dull Web 2.0 Summit last week. Why? Maybe the Summit’s $3,000 price tag kept out everyone but those preaching to the converted, blogs Mark Evans. But over at The New York Times, John  Markoff has anointed Web 3.0 as the Next Next Big Thing. More like Psychobabble 3.0, blogs /Message, snarking that Markoff talking about a meme makes people talk about it. Scobleizer blogs that in 50 interviews in the past three months no one ever mentioned a Web 3.0. Looks like the Times is just mentioning a trend in case one emerges. All this leads Ross Mayfield to say that if Web 2.0 is a bubble, Web 3.0 will just be a disaster. After all, Web 2.0 isn’t even a buzzword yet in the real world, as Blog Herald found out.

 Speaking of bubbles, owner Nick Denton ejected Valleywag writer Nick Douglas-and wants to focus more on money than sex, blogs Good Morning Silicon Valley. That’s right: Denton will it for now and is looking for an experienced reporter rather than, ahem, another college kid. Old Valleywag: Is Marissa Meyer sleeping with Sergey Brin? New Valleywag: John Batelle gets Farked and Michael Arrington is the new Red Herring.

Could Douglas have been fired for this interview with 10 Zen Monkeys, where he hints that Denton’s bad-boy image is just an act? Douglas made enough enemies while at Valleywag, meaning he did a good job, blogs Deep Jive Interests-but despite the rumors, Douglas is not about to partner with Amanda Congdon. But don’t worry about her – she’s busy with a new TV gig for ABC and will appear on the 24-hour ABC News Now  digital channel (via Gawker) and Micro Persuasion reports Congdon will also keep doing her vlog.

Online ad revenues for Q3 2006 hit $4.2 billion, up 2 percent over Q2 and up a heady 33 percent over Q3 2005 (via John Battelle). It’s figures like this that make Google’s Eric Schmidt bullish on the possibility of free, ad-supported mobile phones (via GigaOM). Ad sales notwithstanding, wet blanket Steve Ballmer of Microsoft reminds media companies that money from their copyrights now flows toward Google.

Speaking of Microsoft, the Zune media player launched this week and it didn’t take JANE magazine‘s editors too long to figure out it’s great for meeting boys on the bus. It’s also the first player that will work with the iTunes store-call it iZunes, blogs TechNudge Live but it’s not compatible with Vista. Oops. Also new this week, Confabb which helps conference junkies find over 16,000 conference options (via Next Net), and the relaunch of Jookster, which will let users search MySpace, YouTube and Grouper simultaneously and adds options for digging, del.icio.using and profiling anything you find (via Mashable!). Oh, and Microsoft released Microsoft Firefox 2007 Professional Edition-enjoy the spoof with the coffee you just spit up (via Register).

Finally in politics, While Nancy Pelosi and other Dems pull out the stops to make Jack Murtha the new House Majority Leader (via Huffington Post), Power Line reports the  GOP has quietly named Trent Lott its majority whip in the Senate despite Lott’s disgrace for saying a segregationist Strom Thurmond should have won the presidency in ’48. Murtha is no saint either,  blogs Riehl World View, considering he barely ducked punishment in the 1980s Abscam scandal. But Skippy the Bush Kangaroo says Murtha was the only Dem with the cojones to stand up on the Iraq war-not Harry Reid, Chuck Schumer or Barack Obama.

’08 Presidential Watch: From Taegan Goddard, John Edwards hints to Jon Stewart that he may run, but The Next Prez says Hillary is twice as popular in the ’08 contest, while Rudy Giuliani and John McCain lead for the GOP.

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Politics this week: 11th – 17th November 2006

November 16, 2006 Leave a comment

President Bush, battered by the mid-term elections, embarked on a long foreign trip seemingly designed to boost his image as a global statesman. He was to drop in on Moscow and Singapore before heading to Hanoi in Vietnam for the summit of ASEAN, the Association of South-East Asian Nations. See article

The victorious Democrats served notice that the promised spirit of bipartisanship will have its limits. They say they will block the confirmation of John Bolton’s appointment as ambassador to the UN. The White House is still determined to get Mr Bolton confirmed. See article

Senator Trent Lott, who was forced to resign from the Republican leadership in December 2002 after he made racially insensitive remarks at a birthday party, returned to the Senate’s centre of power by winning election as the minority whip in the next session. Mr Lott will be second-in-command to Senator Mitch McConnell, who replaced Bill Frist as minority leader in the Senate. See article

Work began on a memorial to Martin Luther King on Washington, DC‘s National Mall. King’s will be the first memorial there to someone who was neither a president nor a war hero, and the first to a black American. Work is due to finish in 2008.

Leaders of Mexico’s main opposition, the Party of the Democratic Revolution (PRD), called on their legislators to disrupt the inauguration of the new president, Felipe Calderón, on December 1st. The PRD‘s candidate, Andrés Manuel López Obrador, who narrowly lost the presidential election in July, named a “shadow government” and plans to proclaim himself the “legitimate” president on November 20th. See articleE+

Argentina’s President Néstor Kirchner sacked his housing secretary, Luis D’Elía, after he criticised a warrant issued against nine former Iranian officials for helping to plan the bombing of a Jewish community centre in Buenos Aires in 1994. Mr D’Elía is a sympathiser of Hugo Chávez, Venezuela‘s pro-Iranian president, and a leader of an unemployed workers’ movement. See article

EPA
EPA

In Iraq 11 people were killed at a Baghdad market; more than 35 were killed in American raids; and 20 bound bodies were found in the cities of Mosul and Baquba. Kidnappers, apparently from the interior ministry, abducted dozens of men after storming the education ministry in Baghdad; most were released later the same day.

Mahmoud Ahmadinejad, the president of Iran, said that the world now accepted that his country would master the nuclear-fuel cycle. But after a meeting with George Bush, Israel’s prime minister, Ehud Olmert, said that Israel could not accept a nuclear-armed Iran, and that he and Mr Bush had “complete understanding” over their approach. See articleE+

Hamas and Fatah were reported to have agreed on Muhammad Shubair, an academic from Gaza who is close to Hamas but not a party member, as new prime minister of the Palestinian Authority. But Hamas continues to vow that it will not recognise Israel. Meanwhile, one Israeli was killed and others injured by a series of rockets fired into Israel from Gaza. See article

South Africa‘s Parliament voted to legalise same-sex marriages, the first African country to do so. The ruling African National Congress party ordered all its MPs to vote for the bill to bring the law into line with the country’s constitution, despite opposition from churchmen and traditional leaders.

With all the votes counted, the incumbent president, Joseph Kabila, was declared the winner of Congo‘s presidential run-off election against Jean-Pierre Bemba. But Mr Bemba’s supporters have alleged widespread fraud and the result is likely to be contested in the Supreme Court and on the streets, where the two candidates’ private armies have been exchanging gunfire. See article

Severe flooding in eastern Kenya has killed at least 21 people and made a further 60,000 or so homeless.

The European Parliament approved a law, much delayed and watered down, boosting cross-border competition in services from 2010. Supporters say it could create 600,000 new jobs.

In return for diplomatic help against Iran, America is backing Russia‘s entry bid to the World Trade Organisation. That removes one of the last big obstacles to Russia‘s membership, although Georgia and Moldova, both of which are suffering Russian sanctions, have yet to confirm their agreement.

Less than two weeks before a planned Russia-EU summit, Poland vetoed the start of talks covering energy, trade and human rights. It wants the Kremlin to lift a ban on Polish food imports and ratify an earlier treaty liberalising Russia‘s energy market.

The Center for Constitutional Rights, an American pressure group, has asked Germany to sue the former defence secretary, Donald Rumsfeld, over alleged prisoner abuse in Iraq and Guantánamo Bay. See article

EPA
EPA

Senior diplomats from India and Pakistan resumed talks, broken off after India accused Pakistan‘s intelligence forces of involvement in bomb blasts in July that killed almost 200 people in Mumbai. They put a little flesh on skeletal proposals for a “joint mechanism” to combat terrorism and build trust.

On the eve of George Bush’s departure on his trip that will take in the ASEAN summit in Hanoi at the weekend, America’s State Department removed Vietnam from a list of countries accused of suppressing religious freedom. But Congress failed to approve a proposal that the two countries normalise trade relations.

After shutting down Bangladesh for four days in protest at the alleged bias of the authorities due to oversee elections in January, the opposition called off its national strike, at least until November 20th. See article

In the latest twist in Taiwan‘s continuing corruption scandals, prosecutors interviewed Ma Ying-jeou, the mayor of Taipei and likely future presidential candidate for the opposition Kuomintang, over allegations that he had misappropriated funds. Mr Ma denied any wrongdoing.

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Business this week: 11th – 17th November 2006

November 16, 2006 Leave a comment

US Airways offered to buy its bankrupt rival Delta for $8.7 billion, in a hostile bid analysts hailed as proof that the outlook for America’s struggling airlines was improving. The deal would create America’s biggest carrier, and might prompt other mergers. See article

The boss of Deutsche Telekom, Kai-Uwe Ricke, resigned after shareholders complained about falling profits. The head of the firm’s mobile unit, René Obermann, will succeed him. But strict German labour laws will make it difficult for Mr Obermann to pare costs by cutting jobs. See article

Benetton’s chief executive, Silvano Cassano, also quit abruptly. He had rowed with the Benetton family, which owns a controlling stake in the firm, over the fashion retailer’s plans to expand internationally. The chief financial officer resigned at the same time. Benetton’s shares fell by almost 9% on the news.

The job of Arun Sarin, the embattled boss of Vodafone, appeared secure, however, after the mobile-phone operator’s results proved better than expected. Earnings for the six months to October reached £6.2 billion ($11.5 billion). The firm projected revenue growth for the full year of 6%.

Sony launched a new games console, the PlayStation 3, which it hopes will revive its fortunes after a year of embarrassing scandals and expensive technical faults. But because of further glitches, the firm could supply Japanese retailers with only 93,000 units, which sold out within hours. See article

In the latest proof of Gazprom’s growing clout, ENI, an Italian energy firm, agreed to cede 3% of Italy‘s retail gas market to the Russian state-controlled giant. In return, Gazprom will extend contracts to sell gas to ENI, its largest foreign customer, until 2035. The pair also agreed to look for and develop new fields together in Russia and Africa.

General Electric and Hitachi agreed to set up joint ventures in America and Japan to vie for contracts to build nuclear power plants. Their main rivals in the industry have already forged similar alliances.

The price of copper and other metals dropped as inventories rose. That led to a fall in the shares of mining firms and a slide in the currencies of countries that export lots of minerals, including Australia, Canada and South Africa. See article

Anglo American, a mining conglomerate with big assets in South Africa, said it would invest $4 billion in coal mining and processing in China. Earlier, Larry Yung, a Chinese tycoon, had spent $800m on a 1.1% stake in the firm, in the latest example of Chinese investment in natural resources in Africa.

Deutsche Börse, which runs Frankfurt‘s stockmarket, dropped its bid to buy Euronext, an operator of exchanges in London, Paris, Brussels, Amsterdam and Lisbon. The decision clears the way for a rival offer from the New York Stock Exchange, and leaves Deutsche Börse searching for another partner. See article

Meanwhile, a consortium of big investment banks unveiled their plans for a new share-trading platform that would compete with European stock exchanges. Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, Merrill Lynch, Morgan Stanley and UBS will all own shares in the new venture.

Russia reached a deal with America on joining the World Trade Organisation, a big boost to its 13-year-old campaign for accession. The two countries plan to sign an agreement on November 19th in Vietnam, which is about to become the WTO‘s 150th member. No sooner had Vietnam‘s WTO membership been formally approved last week than Intel, a computer-chip maker, announced that it would raise its investments in the country by $700m.

Marshall Wace, a British-based hedge-fund manager, plans to raise as much as €1.5 billion ($1.9 billion) on the Euronext stock exchange for a new fund. If successful, MW Tops may be the largest such listing. Traditionally, investors have been able to buy stakes only in funds-of-funds, not individual ones, through the stockmarket. See articleE+

The economy of the euro area grew by a sluggish 0.5% in the third quarter compared with the previous one, according to preliminary estimates. Economists had predicted a better performance, but stagnation in France, lacklustre growth in Italy and a slowdown in Germany all weighed on the numbers. Japan‘s GDP also expanded by 0.5% in the third quarter compared with the previous one, but that was higher than most economists had forecast. Compared with the same period last year, the economy grew by 2.7%. See article

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Web 2.0 Malaise; Election Fallout; Brit Splits

November 11, 2006 Leave a comment

The Web 2.0 Summit opens against a backdrop of Web 2.0 funding doubling over the previous year to $455.5 million. Hype is also soaring; witness the breathless piece on Web 2.0 in the San Francisco Chronicle‘s pre-conference coverage, (colorful commentary via Valleywag) followed by a Top 10 Lies of Web 2.0, including “We learned our lesson last time.”

See Read/Write Web and TechCrunch for a whole bunch more logos-er, start-ups-who presented at the Summit’s LaunchPad, including Adify (virtual ad networks), Stikkit (digital sticky notes) and Klostu (single sign-on for message boards). VentureBeat gravitates toward useful products like Omnify, which saves data from multiple sources to a single place. One thing that did get attendees jazzed was the interview with Google’s Eric Schmidt in which he denied the YouTube legal fund rumors.

 Still, few bloggers seem excited about the 13 LaunchPad presenters, and Monkey Bites thinks only one in three companies at the Summit were even Web 2.0. Om Malik complains of Web 2.0 fatigue, citing excess spin from companies desperate for some Web 2.0 fairy dust-but Deep Jive Interests shoots back that Om purveys some of that same spin. Silicon Valley Watcher wonders where all the Web 2.0 users are-not registered users, but user communities.

Even if the Web 2.0 Summit kick-off seemed anemic, the blogosphere added a healthy 100,000 blogs per day during the third quarter of 2006, according to Technorati’s State of the Blogosphere report (via Technorati Weblog). And vlogger creativity was on display at the Vloggie videoblog awards, with Alive in Baghdad taking Best Vlog and Best Political Vlog for its Iraq coverage.

The Web giants were also busy this week: MySpace is expanding into Japan, where it would go head-to-head with Mixi (via Mr. Wave Theory). Meanwhile, Microsoft announces it’s turning its Xbox360 into an HDTV and movie machine (via jkOnTheRun). Unfortunately, Kotaku blogs, the content will include items like Batman Forever and Pimp My Ride.

 In politics, election night started out strangely enough what with Dan Rather appearing with Jon Stewart and Stephen Colbert on Comedy Central. But reality soon trumped comedy as a huge freshman class of Democrats won election to the House (via Eschaton). RCP Blog‘s gallery of big-newspaper front pages says it all. The hunt for reasons the Republicans lost started immediately: their role in runaway federal spending, blogs Instapundit. A failure to deal with illegal immigration, writes Radio Equalizer from the Republicans’ No-Sulk Zone. A failure to stop looting in both Iraq and the U.S., blogs Huffington Post. Or maybe just a habit of taking up big issues and doing nothing with them, muses Hugh Hewitt. Expect a lame-duck Congress that tries passing a lot of bills, and (gulp) Nancy Pelosi as Speaker, blogs The Agonist.

There was another electoral casualty as President Bush announced Donald Rumsfeld’s resignation as Defense Secretary, with former CIA director Robert Gates to take his place (via Yahoo News). Gates was offered the job Sunday while Bush was in Crawford, Texas, having previously turned down the director of national intelligence spot, blogs Confederate Yankee. So much for the Joe-Lieberman-becomes-SecDef rumors, chuckles Daniel Drezner. Too bad Bush didn’t cut Rumsfeld before the election, blogs Blackfive-it would have shown those  who voted against staying the course that he was making important changes. Maybe Rumsfeld just couldn’t face the idea of endless grillings before Democrat-controlled panels, blogs Tom Watson. On Deadline wraps up some of the early analyses.

Finally in entertainment, Gawker hails the end of our long national nightmare as Britney Spears files to divorce Kevin Federline (call him Fed-Ex) and asks for full custody of their offspring. Time to start looking for the next ill-advised marriage, snarks Defamer, but Popsugar loves Britney’s ironclad prenup while PerezHilton.com provides the ugly blow-by-blow of Mr. and Mrs. Spears’ last bitter days. Phew.

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