Tag Archives: Economics

Game of Musical Pockets Between the Trumps and Gulf Princes, Fuzzy iPhone Math and Immigration…..

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Some Arab media have recently quoted an Israeli source that First Son-In-Law Jared Kushner and some Trump associate and lawyer named Jason Greenblatt are using several allied Persian Gulf leaders and potentates as ATM cash machines. For their own financial advantage.
Previously, some media had quoted certain Persian Gulf princes & potentates as claiming that in fact it is they who have Kushner in their deep pocket.
Others had previously also quoted Kushner that the said Gulf princes are in his own pocket of questionable depth….

A bit confusing, this game of pockets, both deep and not so deep, no?

 

I saw some interesting figures put out by Spectator Index that:

It takes earnings of 133.3 average working days in Cairo (Egypt) to buy one iPhone X.
It takes earnings of 4.7 average working days in Zurich (Switzerland) to buy one iPhone.

Truly unfuzzy economic math that partly explains the recent westward and northward immigration surge. If you leave Cairo and go work in Zurich instead, you can buy 28.4 iPhones instead of only one, if you work for 133.3 days. And it can only get worse for the foreseeable future, unless Generalissimo Field Marshal Al Sisi and his ruling military Junta can perform a miracle.

On a lighter yet potentially more serious more ominous note: President Donald Trump was quoted today about Hurricane Florence that “it’s tremendously big and tremendously wet”
No doubt, ‘tremendously wet‘ is a higher category than merely ‘bigly wet’.

Cheers
Mohammed Haider Ghuloum

Economics of Spanking: Forbes Magazine Allegedly Edified in a Stormy Style……..

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Stormy Daniels Reportedly Spanked Trump With A Copy of Forbes Magazine. In the wake of a Wall Street Journal article that alleges Trump lawyer Michael Cohen paid off porn star Stormy Daniels to keep quiet about a 2006 sexual encounter with now-president Donald Trump, several other stories about Daniels’ rendezvous with Trump have surfaced – including one account that she spanked Trump with a copy of Forbes…… “She says one time he made her sit with him for three hours watching ‘shark week.’ Another time he had her spank him with a Forbes magazine.”……..”

Talk about mixing ‘business’ with pleasure…..
I can see Steve Forbes’ famous lopsided smile/grin that some think lost him the Republican nomination so many years ago (he had no chance anyway). His magazine has been edified with the rump of a future (now current) President Trump.

The suddenly-wittier-than-usual Bill Kristol (of Weekly Standard) tweeted that it was a Supply-Side spanking: thus introducing a risky mix of dismal economics with kinky sex.
Which probably (hopefully) tells us what he really thinks of the theoretical underpinnings of the economic policies of Ronald Reagan, Steve Forbes, and possibly Trump (not clear if the latter focuses beyond self-interest). 

Yet I have some doubts about this Stormy story, until I see, hear, read more. No savvy politician or prominent businessman (even some not-so-prominent ones) would engage such services in a hotel room. Probably not even a New York businessman-about-town who is steeped in the culture surrounding beauty pageants and reality shows. There is always the possibility, nay the probability, of electronic recording and taping and blackmail. So all this spank-gate can be fake news as well, even in the case of someone as impulsive as Donald Trump. Maybe, maybe not.

On the other hand: this that allegedly happened, if it happened, was a completely private matter. Besides, there are so many houses of glass around, on both sides.

Either way: way to go, Stormy….

Cheers
M. Haider Ghuloum

Jesus Comes to America: On Christmas and the Economic Miracle of MAGA…….

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MAGA Economics: Rich people elected mainly by poor people taking money from the poor and giving it to the very rich, in the hope of somehow making the poor richer

I once responded to a poll posted on social media about whether Jesus would be allowed into America. That was a couple of years ago. Here is my modified updated version for this unusual year of 2017:

  • He, Jesus Son of Maryam as we call him, wants to come to America. He has heard that this new land is the last bastion of his true followers, those who truly adhere to his sect of Judaism, or so he thinks. He knows they call themselves Christians. He wants to come visit his true believers in what was and is called the Old Confederacy and the Bible Belt West, once called fly-over land. As well as some inland pockets of the two coasts. 
  • He, Jesus Christ, would probably not be allowed on a connecting flight from Europe (back in the Middle East there are many who look like him). Eventually, After some agitation, he might be put on a no-fly list.
  • If not, or if he manages to sneak through the controls, he will face the next obstacle. Some other passenger (almost certainly an American) would complain that he feels uncomfortable with someone dressed in a robe, a hairy man mumbling some strange language, on the same airplane. So, Jesus would likely be bounced off the flight anyway (maybe he’ll be handed a check for $200 as compensation).
  • Let’s assume that he manages to make it after all, perhaps walking across from Mexico or Canada. He will not be allowed into any church because his attire (robe & sandals) is deemed un-Christian. The first Mega-Buck Church would throw him out because he does not fit the image of a member.
  • Besides, he wouldn’t know what a church is. Jesus would look for a synagogue upon arrival. Lucky for him, like I did in my teens, he’d most likely land in New York City.
  • He wouldn’t be any more welcome in a synagogue than in a church. Memories of the Diaspora and pogroms and massacres and the Holocaust perpetrated by his alleged followers do not fade easily. Besides he has no money to pay the very high New York annual fees.
  • He, as Son of Maryam and fruit of Immaculate Conception, might be allowed into a mosque (no fees usually needed there), but only with the hope of converting him to the teachings of the Arab shepherd who came after him. But it wouldn’t last long.
  • He would also wonder who this blue-eyed blond namesake of his was, whose alleged birthday is celebrated by corporate America so eagerly every year. From September to January of each year. And he would wonder what he has to do with a fat jolly Germanic man who likes to wear red and white tights, and jingle his bells.
  • Once enlightened he would wonder what do Amazon and Apple and Macy’s and gas prices and NASDAQ have to do with him.
  • Most of all, he is intrigued about this new noisy Roman governor of America who is pushing a vague new creed that he calls MAGA. He knows it involves some kind of new miracle: Rich people elected mainly by poor people taking money from the poor and giving it to the very rich, in the hope of somehow making the poor richer“. Makes sense?

Cheers & Have a Merry One……
Mohammed Haider Ghuloum

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Why Not Liquidate the IMF?………..

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“IMF members delete anti-protectionism pledge, keep currency commitments. Member countries of the International Monetary Fund on Saturday pledged to work to reduce global imbalances but failed to repeat their past pledge to resist all forms of protectionism. The International Monetary and Financial Committee (IMFC), the IMF’s steering body, also repeated its past commitments on currency exchange rates. “We will refrain from competitive devaluations, and will not target our exchange rates for competitive purposes,” the IMFC said……….”

It has been years since I stopped attending the International Monetary Fund (IMF) meetings (annual, semi-annual, etc). So now is the time for me to ask: Why not liquidate the IMF?
I was never impressed with the people I met there, nor with their tailor-made policies: tailor made to satisfy richer countries, tailor-made to squeeze poorer countries. All written up by their Gucci-clad, duty-free addicted staff allegedly for the benefit of the Wretched of the Earth (including the Middle Classes of the major Industrial Countries).

Ditto the IBRD (World Bank), although the latter can be somewhat useful for the poorer countries.
Just think outside the box…….
Cheers
Mohammed Haider Ghuloum

American Economic and Political Dilemma: Robots Replace Workers, Idiots Replace Political Leaders……..

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“U.S. workers face higher risk of being replaced by robots. Millions of workers around the world are at risk of losing their jobs to robots — but Americans should be particularly worried. Thirty-eight percent of jobs in the U.S. are at high risk of being replaced by robots and artificial intelligence over the next 15 years, according to a new report by PwC. Meanwhile, only 30% of jobs in the U.K. are similarly endangered. The same level of risk applies to only 21% of positions in Japan. The U.S. and U.K. labor markets are both dominated by services jobs, and roughly the same share of workers are employed in key sectors including finance, transportation, education, manufacturing and food services……..”

No real surprise here, and not only robots. If you have not been living on a faraway planet in another galaxy, you’d notice something happening, a trend, for several years. It is not only an issue of robots replacing workers.

Some of the most important jobs in the United States, the most important jobs, all the way to the top, have been taken over by idiots and fools, especially in Washington DC. Most of the political jobs and especially the jobs of their leaders in both the U.S. Congress and the White House have now been taken over, almost completely, by utter idiots. Or so it seems.

Thanks to its new generation of leaders and their backers and their owners, America may well be on its way to rejoin the Third World. In Congress, each side has been engaging in self-gratifying political ideological masturbation. Partner-less of course by definition. Class distinctions are already sharpening, ethnic and religious distinctions are being encouraged, and self-serving Think Tanks of Hate are rolling in dark money.

All this is probably a bit of an exaggeration: no country in the world, or in its history, has been or is as resilient as the United States of America. This shall pass. There is always hope, as long as there are free and “unfettered” elections coming. As long as the people remain educated. Politics is a series of experiments, an exercise in trial and error.

More on this later, stay tuned.

Cheers
Mohammed Haider Ghuloum

New Old Saudi Vision of Total Conformism: from Riyadh to Pyongyang………

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“The Council of Ministers endorsed during its session on Monday under the chairmanship of Custodian of the Two Holy Mosques King Salman Saudi Arabia’s Vision 2030. The Cabinet session was devoted to discuss the vision, which was drafted by the Council of Economic and Development Affairs upon instructions of Custodian of the Two Holy Mosques. Following is the text of Saudi Arabia’s vision 2030……..”

The new phrase Saudi Vision 2030 has been covered extensively in Saudi, Gulf, and some Arab media. There has been some good coverage in international media as well, until a heavy dose of realistic skepticism set in. I am in no position to openly express my own judgment yet, but I will soon. There is certainly a need to look beyond the years of oil boom, a need for some new (and serious) vision.

Yet I don’t like the quick and intimidating cheering in the Gulf GCC region, the exclusion and rejection of any doubt or questioning.  No debate of  such a vital issue. The distinctly Saudi conformism that is spreading to all GCC states.

As expected, Saudi and Gulf GCC media are not critical: not one iota of criticism or healthy (or unhealthy) doubt has been expressed. A lot of enthusiasm has been expressed, in blissful ignorance. Suddenly everybody on the Arab shores of the Gulf is as conformist as any good Saudi citizen in Riyadh or Qassim, anyone who is not in the safety of foreign exile or in a local prison. It is like the old days when Saddam was issuing his Baathist drivel across the Persian Gulf media and nobody was allowed to criticize him.

No doubt there are many ‘secret’ doubters, especially in the other Gulf GCC states if not in heavily brain-washed Saudi Arabia, but they dare not express their doubt. It is almost like having Kim Jong Un of North Korea (the Cute Leader) publish an economic “vision” for his country! Nobody would even think of criticize him in old Pyongyang.

Similarly, some Persian Gulf states are moving rapidly toward a new common repressive model. Even in places where the press “used to be” relatively free. Criticism of the plan by Prince Mohammed, the the favorite son and possible successor of King Salman, would be considered “insulting a sisterly or brotherly” state. That is a new category of crime that could land you in prison anywhere in the GCC (as in Pyongyang).

If the open doubter is a true Wahhabi terrorist-supporter he could go to prison and maybe get rehabilitated from his doubts. If he is a Shi’a agitator or doubter, he will likely be charged with “terrorism” and lose his head to a sword.

But is this emperor, in this case Prince Mohammed Bin Salman and his vision, also naked (as in the famous parable or fable)? I am not certain yet. That will be covered in a new post coming soon to a theater right here. I have not read the detailed outlines of this economic vision in detail, yet. Who knows, I might become an enthusiastic supporter as well.
But the devil is in the details.

Cheers
Mohammed Haider Ghuloum

Is It Brotherly Blackmail? Lebanon in Arab Financial Crosshairs………

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The Saudi move to cancel the $4 billion promised aid to Lebanon (and indirectly to France) is apparently a ‘first step‘ in something bigger.  At least that is what Saudi proxies and allies in Beirut are gleefully threatening.

The Saudis are frustrated with their failure to weaken Hezbollah and pull Lebanon out of what they claim is an Iranian orbit. It is hard for them to believe that all the inducements they have offered Lebanon could fail, that their top proxies in Beirut, occasional billionaire Saad Hariri and his sidekick Fouad Saniora, could not bring the small country along. One Lebanese minister, a Mr. Mashnuq (the Hanged Man) who is part of the Saudi-financed March 14 (Hariri) camp has warned of more pain to come. Clearly a not subtle Saudi threat-by-proxy.
The threat of “more pain to come” could include a renewal and expansion of previous expulsion measures against the expatriate Lebanese citizens in some GCC states of the Persian Gulf.  The UAE has recently been reported to have resumed its old policy of summarily expelling Lebanese expats who are Shi’as. The secretary general of the GCC, a Bahraini close to the ruling autocrats, has ominously warned Lebanon for going against what he called erroneously “Arab consensus on Iran“. The GCC secretary was of course lying, to put it politely: in fact there is no Arab consensus on Iran or on anything else whatsoever.
An expulsion of the Lebanese expats would not be in the interest of the Gulf states. They are not normally involved in politics. Many businesses and institutions benefit from the Lebanese experience and skills in various economic sectors. It would effectively lower the efficiency of business and the quality of life in the host countries.

Some Arab media speculate that the Saudis are canceling the promised aid partly because of their own dire financial situation. A situation largely created by their own short-sighted oil policies of recent years.

Another possible factor that Saudi and Gulf media ignore is that the Lebanese authorities are holding a high-ranking young Saudi prince who had tried to smuggle large quantities of illegal drugs on his private jet through Beirut airport.

Will all this economic pressure against Lebanon work? Will the small country where pro-Wahhabi sentiment is restricted to a small fraction of the population yield to Saudi pressure?  It looks highly unlikely now, given the political realities and the demographics of Lebanon.

The Israelis are watching this game next door with great interest.
Cheers
Mohammed Haider Ghuloum

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Greek Drama: Beware Europeans Bearing Poisonous Gifts……..

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Several years of disastrous economic policies imposed by the IMF and the European Union and its bureaucrats have brought Greece to its knees.
Now that Greece is in a deep recession, with low income and terrible high unemployment, the same European bureaucrats are set to impose deeper tightening economic policies on Greece. What can result from deeper tightening in an economy that is in deep recession with little to export? Why, the next step is logically a depression.
What seems to matter most to European bureaucrats is that European governments and banks do not reduce Greek debt. Unlike decades ago in the 1950s when the United States and others canceled about 50% for German foreign debt and extended reduced payments over several decades. But that was when the West was facing the Soviet challenge and needed to showcase the Western part of Germany. There is no Communist challenge, so the West can afford to tighten the screws on Greece, so the Greek people will suffer for many decades, years after they leave Europe. Unless the Europeans come to their senses.
Cheers
Mohammed Haider Ghuloum                          Follow ArabiaDeserta on Twitter
m.h.ghuloum@gmail.com

All the New King’s Men: Betting the Farm on Military and Economic Adventures……..

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“But Saudi Arabia and the other Sunni Arab states should not be so singularly obsessed with the danger posed by Shi’ite-led Iran. These states have other internal problems and economic worries to deal with, especially bulging youth populations and the lack of avenues for political expression. The House of Saud is facing a challenge from the militant group Islamic State, which carried out a suicide bombing last week that killed at least 21 worshippers at a Shi’ite mosque in the kingdom’s Eastern Province. The Saudi regime must also cope with the long-term consequences of declining revenue due to lower oil prices………….”

Saudi Arabia has taken a couple of big gambles in recent months. The ruling family has taken some questionable advice on how to slam its regional opponents and rivals, mainly Iran and Iraq, and tighten its alliance on the Arab side of the Persian Gulf. Both are extremely risky:

  • The Saudis have uncharacteristically allowed oil prices to plunge, thus aiming new economic blows at an Iranian regime that is already enduring a tough Western economic blockade. Along the way they also aimed a few left hooks to Mr. Putin’s Russia, a major supporter of Syria and Iran. (Unlike the Western powers, Mr. Putin has not yet threatened to put ‘boots on the ground’ in Syria or to keep a military option on the legendary table).
    The Saudis also struck at the very-cost-sensitive American and Canadian shale oil industry, now a major rival in the market.
  • In addition to “lowering” oil revenues, the kingdom has also started to bet high in a regional poker game. It started an expensive bombing war against the poorest Arab country, Yemen (now mostly controlled by Houthis and the Army). A costly and intensive bombing war that has shown no results in more than two months except destruction of Yemen’s fragile infrastructure. And plant cluster bombs across that country.
  • In addition to the high cost of bribing the rulers of Sudan and Jordan and Morocco and Senegal to join their Yemen military adventure.
  • The new King also immediately raised salaries of all military and security employees and granted every public servant (most working Saudis) and student a two-month extra salary bonus.
  • The total cost of all that is almost certain to exceed one hundred billion dollars: by how much depends on the duration and intensity of their new war. And how much the newly promoted princes (MBN, MBS, XYZ…..) skim off the military expenditures and other major contracts. Meanwhile oil revenues are down, creating a risky imbalance and a drainage on foreign reserves.
  • Contrary to what the Saudis expected, the Houthis and their army allies have expanded their territory since the air campaign in Yemen started. They have now started to attack inside the Saudi home territory, with a surprising degree of ease and impunity. Which is leading to more Saudi casualties, probably an unexpected consequence.

What makes all this riskier is that the new King Salman, in an un-Solomonic move, has started immediately to turn his country’s budget, which is essentially the ruling family budget, into a large deficit. In the process he is depleting his country’s foreign reserves.

The cash bonuses paid out are already eaten up by the inevitable higher prices. So far the war on Yemen looks set to drag on unsuccessfully, all the munitions and cluster bombs need to be replaced. The newly-promoted young princes try to get even richer while they can. Then they will all be back to the starting point……….

Their foreign reserves are still high. Maybe they can withstand it for a sustained period, maybe, but for how long and at what rate of depletion……..


Cheers
Mohammed Haider Ghuloum                          Follow ArabiaDeserta on Twitter
m.h.ghuloum@gmail.com

New Age Heroes: Financial Opportunists, Lobbyists, and Rogue Crusaders………

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“Haym Salomon funded not only the Revolutionary War but several leading politicians, yet passed on claiming huge debts. On January 6, 1785, Haym Salomon, the Polish-born immigrant to colonial New York who is revered in American history as the financier of the Revolutionary War, died. He was all of 44 years old — and he was bankrupt………….”

They have a picture of a 10 cent U.S. stamp from 1975 calling Haym (Haim) Salomon a “financial hero”. It says somewhere that he ran a “brokerage business” as well, but apparently he had nothing to do with Salomon Brothers firm that came later. Mr. Salomon died bankrupt, but only because he lived in a different era.

Speaking of financial heroes, I fully expect the new U.S. Congress (both houses) to start creating new “financial” heroes. I expect some top lobbyists to be named, as well as CEOs of Citigroup and JP Morgan Chase and Mr. Blankfein of Goldman Sachs. For their role in the crash of 2008 that required government funds to bail all these geniuses out. The Koch Brothers and Sheldon Adelson of Las Vegas gambling, financial godfather of the New New Republican Party, will surely be on the list. Not to ignore some other likely candidates: famous anti-tax, anti-affordable universal healthcare, anti-affordable higher education, and anti-welfare ‘crusaders’.

The New New Democrats, led by you-know-who-she-is, should they win the White House in 2016, will likely not only follow the same path, but revert to their old habit of appointing top bankers as top financial officers of the U.S. government.
As for myself, I would suggest an economist like Paul Krugman or even Robert Reich for treasury secretary. But that would limit the New New Democrat president to one term. Unless she or he is impeached and convicted first by an uncharacteristically outraged Congress.

Cheers
Mohammed Haider Ghuloum                          Follow ArabiaDeserta on Twitter

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