Wednesday, November 24, 2010

Facebook Shares Get Sliced Into Derivatives as Value Surges

Don't mind me. I'm just putting this up as a resource. But, since I'm at it, I may as well say what I think in the deep recesses of my vacuous mind.

I'm endlessly fascinated and, at the same time, repulsed, by the numbers of ways in which equity, equity-type, financial, and financial-type products can be derived and derived upon derive from a basic equity or debt instrument.

Here we have another derivative product. It is linked to a super-duper company, Facebook. 

This report is from Bloomberg:

Facebook Inc.’s surging valuation is spurring shareholders to slice and dice their stock, giving investors everywhere from Silicon Valley to Wall Street a chance to bet on the company.

Laffer Curve + Irish Implosion

To me an interesting article begins with an anecdote. So, Chris Farrell's piece on Arthur Laffer and his Curve, weaved with supply-side economic thinking as lead-ins to the current Irish economic crisis is, most certainly, an interesting article.

Basically, the point is that reduction of taxes a'la Ireland, is not a panacea to the challenges of managing an economy. But, then again, what policies are ever permanent? Of course, Farrell is dealing with the current set of economic challenges in the Western world - dealing with an era of tax cuts and deregulation - and witnessing the sheer and wanton abandon with which financial institutions failed to apply common sense and risk management principles.

Let me not get carried away.

I will just tease you with the opening lines of Farrell's piece. Then you can click on the "read more" to, well, read more:

It may be the most famous dinner in economic history. Arthur Laffer was a professor at the University of Chicago. In December 1974 he dined at the Two Continents Restaurant in Washington, D.C., with Donald Rumsfeld, chief of staff to President Ford; Dick Cheney, Rumsfeld's deputy; and Jude Wanniski, associate editor at The Wall Street Journal. According to Wanniski, Laffer grabbed a napkin and pen and sketched out the Laffer Curve, illustrating the trade-off between tax rates and tax revenues. In a few more years the tax-cut philosophy dubbed supply-side economics would dominate fiscal policy under President Ronald Reagan.

Microfinance Dominates Indonesian Shariah-Compliant Loans

The trend of microfinance products gaining traction in populous nations like Indonesia will have positive results for their economy. I've been a fan of microfinance for some time now. My previous blogposts on this will bear me out. 

However, as always, the caution is always on the mode of delivery. The Grameen model is the ideal one. I'm not sure how Indonesia is doing the delivery of microfinance products. But, if banks are the ones providing the delivery of microfinance products one key feature of the Grameen model will certainly be absent. This is the feature of community-guarantee, where five borrowers who are known to each other will collectively guarantee and vouch for each other. This feature has been, in my view, crucial in reducing the rate of defaults in microfinance loans. 

The absence of this feature has been my concern about Malaysian-based microfinance products.

Tuesday, November 23, 2010


In tandem with my hesitant entry into microblogging, I have also decided to ditch the claustrophobic feel of the library template to go for absolute simplicity. No more frills.

Microblogging on the fly

Alas! The pressures of time and commitments have caught up with me in recent months. I have had to resort to using the social media to maintain some semblance of a presence in the blogosphere.

So, as you may have noted, I have created a Twitter sidebar so that I can still do some micro jottings.

I approach this new feature with much trepidation because 140 characters in Twitter may not look pretty for someone who is used to 1,000 word excursions. Needless to say, my blogging history has not prepared me at all for the haiku-like requirements of Twitterdom.

Thursday, November 4, 2010


HAPPY DEEPAVALI TO ALL HINDUS IN MALAYSIA AND ELSEWHERE. And, happy long weekend to the rest of Malaysia. Be safe.

The name Diwali is a contraction of the word "Deepavali" (Sanskrit: दीपावली Dīpāvali), which translates into row of lamps. Diwali involves the lighting of small clay lamps (divas) (or Deep in Sanskrit: दीप) filled with oil to signify the triumph of good over evil. Source: Wikipedia
pix from here.

Tuesday, November 2, 2010

Ted Sorensen

Every leader needs a good speechwriter and alter ego. He had two close confidantes with whom he could bounce ideas and receive advice - the kind of advice that is free of any sycophancy. John F. Kennedy was lucky. He had Bobby and Ted.

There was Robert F. Kennedy. Bobby was the enforcer who could run interference to deflect JFK from any political danger.

Then, there was Ted Sorensen, who died yesterday. With Sorensen's passing, the mythical Camelot of the Kennedy Presidency has lost its final link.

I have done a post sometime ago in the eve of Barack Obama's presidential inauguration where I focused on styles of speaking between JFK and Obama. I highlighted Sorensen's crucial role in preparing and drafting JFK's seminal Inaugural Adress in 1961.

I am too involved in project work to pen down my own thought and words about my own feelings on the matter of Sorensen's passing. Instead, I refer you to the most excellent eulogy of sorts from the Boston Globe:

Of the courtiers to Camelot's king, Theodore C. Sorensen ranked just below Bobby Kennedy. He was the adoring, tireless speechwriter and confidant to President John F. Kennedy, whose term was marked by Cold War struggles, growing civil rights strife and the beginnings of the U.S. intervention in Vietnam.

Soaring rhetoric helped make Kennedy's presidency a symbol of hope and liberal governance, and the crowning achievement for Sorensen, who died Sunday, was the inaugural address that was the greatest collaboration between the two and set the standard for modern oratory.

With its call for self-sacrifice and civic engagement -- "Ask not what your country can do for you, ask what you can do for your country" -- and its promise to spare no cost in defending the country's interests worldwide, the address is an uplifting but haunting reminder of national purpose and confidence, before Vietnam, assassinations, Watergate, terrorist attacks and economic shock.

But to the end, Sorensen was a believer.

He was 82 when he died at noon at Manhattan's New York Presbyterian Hospital/Weill Cornell Medical Center from complications of a stroke, his widow, Gillian Sorensen, said.

Sorensen had been in poor health in recent years and a stroke in 2001 left him with such poor eyesight that he was unable to write his memoir, "Counselor," published in 2008. Instead, he had to dictate it to an assistant.

President Barack Obama issued a statement saying he was saddened to learn of Sorensen's death.

"His legacy will live on in the words he wrote, the causes he advanced, and the hearts of anyone who is inspired by the promise of a new frontier," Obama said.

Kennedy's daughter, Caroline Kennedy, called Sorensen a "wonderful friend and counselor" for her father and all of her family.

"His partnership with President Kennedy helped bring justice to our country and peace to our world. I am grateful for his guidance, his generosity of spirit and the special time he took to teach my children about their grandfather," she said in a statement.

Hours after his death, Gillian Sorensen told The Associated Press that although a first stroke nine years ago robbed him of much of his sight, "he managed to get back up and going."

She said he continued to give speeches and traveled, and just two weeks ago, he collaborated on the lyrics to music to be performed in January at the Kennedy Center in Washington -- a symphony commemorating a half-century since Kennedy took office.

"I can really say he lived to be 82 and he lived to the fullest and to the last -- with vigor and pleasure and engagement," said Gillian Sorensen, who was at his side to the last. "His mind, his memory, his speech were unaffected."

Her husband was hospitalized Oct. 22 after a second stroke that was "devastating," she said.

Some of Kennedy's most memorable speeches, from his inaugural address to his vow to place a man on the moon, resulted from such close collaborations with Sorensen that scholars debated who wrote what. He had long been suspected as the real writer of the future president's Pulitzer Prize-winning "Profiles in Courage," an allegation Sorensen and the Kennedys emphatically -- and litigiously -- denied.

They were an odd but utterly compatible duo, the glamorous, wealthy politician from Massachusetts and the shy wordsmith from Nebraska, described by Time magazine in 1960 as "a sober, deadly earnest, self-effacing man with a blue steel brain." But as Sorensen would write in "Counselor," the difference in their lifestyles was offset by the closeness of their minds: Each had a wry sense of humor, a dislike of hypocrisy, a love of books and a high-minded regard for public life.

Kennedy called him "my intellectual blood bank" and the press frequently referred to Sorensen as Kennedy's "ghostwriter," especially after the release of "Profiles in Courage." Presidential secretary Evelyn Lincoln saw it another way: "Ted was really more shadow than ghost, in the sense that he was never really very far from Kennedy."

Sorensen's brain of steel was never needed more than in October 1962, with the U.S. and the Soviet Union on the brink of nuclear annihilation over the placement of Soviet missiles in Cuba. Kennedy directed Sorensen and Bobby Kennedy, the administration's attorney general, to draft a letter to Nikita Khrushchev, who had sent conflicting messages, first conciliatory, then confrontational.

The carefully worded response -- which ignored the Soviet leader's harsher statements and included a U.S. concession involving U.S. weaponry in Turkey -- was credited with persuading the Soviets to withdraw their missiles from Cuba and with averting war between the superpowers.

Sorensen considered his role his greatest achievement.

"That's what I'm proudest of," he once told the Omaha (Neb.) World-Herald. "Never had this country, this world, faced such great danger. You and I wouldn't be sitting here today if that had gone badly."

Robert Dallek, a historian and the author of "An Unfinished Life: John F. Kennedy, 1917-1963," agreed that Sorensen played a central role in that crisis and throughout the administration.

"He was one of the principal architects of the Kennedy presidency -- in fact, the entire Kennedy career," he said Sunday.

Of the many speeches Sorensen helped compose, Kennedy's inaugural address shone brightest. Bartlett's Familiar Quotations includes four citations from the speech -- one-seventh of the entire address, which built to an unforgettable exhortation: "Ask not what your country can do for you; ask what you can do for your country."

Much of the roughly 14-minute speech -- the fourth-shortest inaugural address ever, but in the view of many experts rivaled only by Lincoln's -- was marked by similar sparkling phrase-making:

"Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to assure the survival and the success of liberty."

-- "If a free society cannot help the many who are poor, it cannot save the few who are rich."

-- "Let us never negotiate out of fear. But let us never fear to negotiate."

As with "Profiles in Courage," Sorensen never claimed primary authorship of the address. Rather, he described speechwriting within Kennedy's White House as highly collaborative -- with JFK a constant kibitzer.

In April 1961, weeks into the Kennedy presidency, the Soviet Union launched the first man into orbit. Less than a month later, Alan Shepard became the first American in space with a 15-minute suborbital flight. The idea of a moon landing "caught my attention, and I knew it would catch Kennedy's," Sorensen recalled. "This is the man who talked about new frontiers. That's what I took to him."

Shortly after Shepard's landmark flight, Kennedy said: "I believe this nation should commit itself to achieving the goal, before the decade is out, of landing a man on the moon and returning him safely to Earth." U.S. astronauts met that deadline in July 1969.

Kennedy reinforced the Eisenhower administration's commitment of sending advisers to South Vietnam, but Sorensen maintained that the president, had he not been assassinated, would eventually have withdrawn American troops. Sorensen also believed that the president would have passed the civil rights legislation that successor Lyndon Johnson pushed through.

On the afternoon of Nov. 22, 1963, Sorensen was leaving his home in Arlington, Va., where he had stopped briefly after lunching with a newspaper editor, when he was summoned to the White House.

There, his secretary told him that the president had been shot in Dallas.

"Sometimes," Sorensen told an interviewer in 2006, "I still dream about him."

Sorensen's youthful worship never faded, even as he acknowledged Kennedy's extramarital affairs. "It was wrong, and he knew it was wrong, which is why he went to great lengths to keep it hidden," Sorensen wrote in his memoir. "In every other aspect of his life, he was honest and truthful, especially in his job. His mistakes do not make his accomplishments less admirable; but they were still mistakes."

Sorensen would witness a brief revival of Camelot with the presidential election of Obama, whom Sorensen endorsed "because he is more like John F. Kennedy than any other candidate of our time. He has judgment as he demonstrated in his early opposition to the war in Iraq."

A year after Obama's election, Sorensen said he was disappointed with the president's speeches, saying that Obama was "clearly well informed on all matters of public policy, sometimes, frankly, a little too well informed. And as a result, some of the speeches are too complicated for typical citizens and very clear to university faculties and big newspaper editorial boards."

Theodore Chaikin Sorensen was born in Lincoln, Neb., on May 8, 1928. His father, C.A. Sorensen, was a lawyer and a progressive politician who served as Nebraska's attorney general.

His son described the elder Sorensen as "my first hero." Growing up, Sorensen once joked, "I wasn't involved in politics at all -- until about the age of 4."

He graduated from Lincoln High, the University of Nebraska and the university's law school. At age 24, he explored job prospects in Washington, D.C., and found himself weighing offers from two newly elected senators, Kennedy of Massachusetts and fellow Democrat Henry Jackson, from Washington state.

As Sorensen recalled, Jackson wanted a PR man. Kennedy, considered the less promising politician, wanted Sorensen to poll economists and develop a plan to jump-start New England's economy.

"Two roads diverged in the Old Senate Office Building and I took the one less recommended, and that has made all the difference," Sorensen wrote in his memoir. "The truth is more prosaic: I wanted a good job."

At the 1956 Democratic National Convention, the charismatic Kennedy attracted wide attention as a candidate for vice president. He eventually withdrew, but his exposure at the convention led to a flurry of invitations to speak around the country.

During the next four years -- the de facto beginning of Kennedy's presidential run -- he and Sorensen traveled together to every state, with Sorensen juggling various jobs: scheduler, speechwriter, press rep.

"There was nothing like that three-four year period where, just the two of us, we were traveling across the United States," Sorensen told The Associated Press in 2008. "That's when I got to know the man."

After Kennedy's thousand days in the White House, Sorensen worked as an international lawyer, counting Anwar Sadat among his clients. He stayed involved in politics, joining Bobby Kennedy's presidential campaign in 1968 and running unsuccessfully for the New York Senate four years later. In 1976, President Carter nominated Sorensen for the job of CIA director, but conservative critics quickly killed the nomination, citing -- among other alleged flaws -- his youthful decision to identify himself as a conscientious objector.

Besides "Counselor," his books included "Decision Making in the White House" (1963), "Kennedy" (1965) and "The Kennedy Legacy" (1969). In 2000, Hollywood turned the Cuban missile crisis into a movie called "Thirteen Days." Actor Tim Kelleher played Sorensen.

His role, according to Sorensen? To "think and worry. ... often bent over."

Gillian Sorensen said a public memorial service would be held for her husband in about a month, but the exact date has yet to be set. She said there would be no formal funeral.

Survivors also include a daughter, Juliet Sorensen Jones, of Chicago; three sons from his first marriage, Eric Sorensen, Stephen Sorensen and Philip Sorensen, all of Wisconsin; and seven grandchildren.