Bernard Madoff received his sentence of 150 years in jail

By Iroabuchi Onwuka

June 29th 2009 is a day to be remembered for many things including a very fair weather and the sentencing of a disgraced financier by name Bernard Madoff. Bernard Madoff received 150 years sentence for a proven case of 'securities fraud' 'racketeering' and the scheme to commit fraud. He was given a short window of probation after the initial 50 years at which time he is likely to have reached his 120th year. For a man 71 years old, this was nothing more than a death nail. We should not forget to mention that Judge Chin had his day before the world, and it cannot be denied that seem to penetrate the minds of the people is that the court provided the hammer for justice.

The sentencing of Bernie Madoff represented to me a formal closure of a sad event, but more than anything it was an opportunity for US judiciary to clean their mess before the world. Before Madoff there has been all kinds of miscarriage of judicial process, the kind that takes place everyday, the kind that see many Blacks and Hispanic go to jail for nothing and New York City residents thrown away from their houses for nothing. I mean, we still have bad taste of the acquittal involving the death of Sean John's but this 29th of June 2009 was for one man only, Bernie Madoff who was a big elephant for the US Judicial altar.

I was however part of the physical crowd present during the sentencing of this Bernard Madoff at 500 Pearl street located at Worth between Bowery and Center street, New York. This is a ceremonial lower Manhattan court house named after Patrick Monahan, at least a quarter of mile away from China town. Looking around me, it was impossible to deny the emotion of people whose life where wiped out by this biggest fraud in US history and of very rich people who were beginning to feel the pince of poverty in New York. Yet the irony of this very rich crowd was that New York had something in the neighbourhood of 35 thousand homeless people who non of them including Madoff would had the course to look twice, even if 15 thousand of these homeless are just children. Yet a fraud is a fraud, and the axe that has fallen on many will not evade the broker like Bernie Madoff who tells you that a deal was off becuase your parents are dead.

If the crowd seethes with resentment at the Court it was due to the heat of the sun and if they were very impatient it was baucause the 9th floor was entertained to long court proceedure. The journalist themselves were all over the place. They were working from very squeezed area of that downtown and many of them where changing their cloths right in front of the crowd. The Black trucks were also present for these news makers. There was CNN and American satelite link who occupied much of the place, there was Accent and TVL Technologies group, there was a black truck of NY 1, there was Channel 12, Eyewitness news/ABC Channel 7, CNBC, Court TV, and many other people with their HDTV all squeezing for action on this historic day. Then there was the rest of us watching the drama evolve and the people who we call Tourist all still clutching for the news on Bernard Madoff, who broefly reminded of Jay Could and Fisk in not past a century. I for one, seriously regretted not having a Camera and an audio recorder on this day, there was people willing to have their say on this day.

I could guese that not many standing in the crowd know the whole story about the man in question called Madoff, saving for the constant news that he did something wrong in finances market. He took people's money and as such he should pay for it seem the general hope. But how he ruined people's life saving and families trust funds. This scam involved his fellow Jews and no only that, it involved top dogs and attroneys like Robert Shapiro and big time film maker who had helped his people to a very extent; Steven Spielberg. The worst aspect of the whole thing is that he committed securities fraud. That he used his positions and connections in NYC stock exchange to steal away people's trust fund which means that he probably took fillinf orders and cash with it and never did anything with it. He may have also have scammed his way somehow to the top, perhaps gradually and most perhaps through illegal means, with hope perhaps to redeem their money at a later date. But who cares about such thing, the man was down already from the public disgrace he brought on himself and his Jewish people.

According to CNNmoney, several two finacial institutions had already presented a public case on the man and an insurance company by Securities Investor Protection Insurance had approve 371 claims totalling 161 million dollars. Trustee Irving Picard has at least 13 000 listings totaling 13 billion dollars. Yet deeper into the very formation of the insurance companies and the people
who revolved around this Trustee Irving Picard - despite their public claims - will show that Madoff was not alone. Some of his Jewish people may have been hurt in persons, in wealth and in ideas, but he was not alone and they not alone.

'Sun for spite will not show his face' is from a poem by Abraham Ibn Ezra, a 13th century of Jew of Spain and North Africa. The sufferings of his people were too hard to speak off and now in this US where displaced Jews from Spain settled, Madoff begins to re-enact the stupid suspicions of his Jewish people. Shall we begin to call Madoff case a tragedy since his rise to the all wonderful position of Chairman of Nasdaq came from hardwork and stealth of day trade, and his fall came from feeling too comfortable hence acting in breach of public trust. Perhaps in future, but today belong to the sentencing of Bernie Madoff who rigged people out of their lifelong money, a scheme like nothing we have ever seen, a Ponzi scheme like nothing we should be force to see in our time.

Real losers of Iran's election

Philip Steven column on Financial Times for June 15th speak eloquently of the problem Iran
an Mussavi. In his article titled 'Iran exposes the gap between idealism and realism for Obama', Steven highlighted the ideological problems of running Iranian election under the reflexes of current Islam mode. The Iranian election was between the incumbent Ahmadi -Nejad and Hossein Mussavi, and reactions after the election seem to indicate Mussavi as the American strategic interest in the election. The fact that the election was supposed to be closer to Western style in conduct may have been an exaggeration on the of Obama and his European colleague, a problem which exposed the fact that Obama and his colleagues underestimated the problem of ideology between Iran and America. Of course the Americans and their European counterpart were hoping for a win, perhaps a political end of Ahmadi-Nejad and his threatning language of violence and Nuclear ambition. The result of the election is that against all expectation, Mussavi lost the election. But wo were the real losers of that election.

Hossein Mussavi who lost 2009 Iranian presidential election to Mr. Ahmadi-Nejad, may have widened the gates of democracy in Iranian but the real losers of that election may not yet be our own American government rather, companies acting for the their own interest in terms of government deals from Iran. We know of Halliburton and their problems of corruption in oil rich parts of the world but what many Americans don't really know is that the world of oil is not only a competition opened to them. Was Mussavi the real loser of that election? techinically yes, but still more, the answer take into account what a victory would have meant for Iran. Aside from the democracy and opulence that a right wing ideology would have brought to Iran, there is a great issue of government contracts and expenses which for many years have been the real acme of war behind the scenes of Iranian politics.

It is impossible to say if Mussavi would have made a better president than Ahmadi-Nejad. Yet America if not the world could have been better served with any one other than the rantful current incumbent. There is also the facts of a more 'realised' possible defeat of Ahmadi-Nejad which was entirely narrow. In fact the outcry for change in Iran and the nature of that election may have surprised a lot of Iranians, especially the concept of demonstration in Tehran on the claim that the election was full of malpractices. But in reality who really expected that change to be that quick and eminient in Tehran Iran. The heavy locus of that change is how many European companies will become frustrated with a new American backed contestant. Pension workers in either of these continental interest would go the distance of realigning themselves to the problem of Global market and that could trip off the issue of lobbying.

It is the faith of many countries in the world to host a congregation of lobbying giants, and in near East and in Middle East, this has been the case. Saudi Arabia reflects the problem of that oil world and in that case, many lobbyist move than the area with all their portfolio. In Iran, since the Americans began to make a wish list for Iran, the Iranian Government under Ahmadi-Nejad had made serious contact with oil companies from around the world. In many parts of oil rich countries in the world like Nigeria, the relationship between state pension and any form of investment in oil has often led to death, sometimes catastrophic death. The environmental consequence is still that much and above all, companies from different parts of the world with lots of new idea are twisted out of shape by older partnership with such countries. In essence, the continuing argument on whether Iran is a terrorist country comes own heavily on what the business people in Iran think.

The aspect of business oversight and what the media houses are saying on Iran come down on the lobbyist group for giant companies are saying. Many of these American companies and European counterparts are busy lobbying the news Media on the consequence of Iranian terrorism. In spite of the face we give Iran, there are many American business men and women, have serious contact with Iran and many of them deal. For instance the problem of Bill Clinton's Saudi Arabian and UAE interest which emerged during the last Democratic candidature involving Hilary Clinton and Barrack Obama. It was surprising to many people that Hilary Clinton voiced out that UAE and Saudi Arabia and United States relarliate against Iran, if possible attarck attarck Iran, that is if Iran should invade Kuwait. Such issue is however unlikely to surprise traders since Hilary Clinton and Bill Clinton have extensive business interest in UAE, Saudi Arabia and Kuwait and have international heavy lobbyist. There is no mistake that her group of lobbyst and media driven were seriously following the development of Iranian election, which would have seen Mussavi succeed as a new world of oil interest begun.

In a new book by Dick Morris & Eileen McGann, published here in New York in 2008. The book cited that the following companies are dealing and willing in Iran, a country called the terrorist states. According to the book, one of those companies who recently signed deals with Iran to intergrate its highspeed submarine cable is Alcatel SA & Lucent technologies, the deal was supposed to cost billions of dollars. The project will provide all kinds of business opportunity for Iranians and many companies will do anything to keep others away from Iran while at the best time keeping them enemies of the United States.

The book went on to say what is going on in Iranian and American business. In 2005 Iran secured loan business with US regarding a 'fire year deal'. There is also Commerzbank AG carrying Iranian EuroBond which has since its inception penned down over 400 million dollars.
There is the severe problem of oil and oil companies doing their bidding in Iran, for instance Sinopec China petroluem and Chemical corporation) owned by China and operate "all levels of the Crude oil discovery extraction and refining process". Royal Dutch Shell has thousand of workers in Iran and have their lobbyist in US. All these companies had part time business with Iran now owe substantial business contract with Iran in the last few years. Under George Bush and Dick Cheney America were all about the invading these enemy states and that's still the case in current American invasion of Iran.

The main event in the whole losers and winners of Iranian election come down to Hyundai, which is South Koreans may also have their deals with the said people, in fact Hyundai and Rotem have a huge Rail transport understanding with Iran. Hyundai had to outbid others in the process of building 39 ships for oil and are supposed to use the 'converted interest from investors' that is some companies and investors of American weight were welcome to do business with the company. The problem on pension and helpful policy had been a source of interest for Americans, had the companies that were once based Iran should gain what they were looking for, they will go along way to determine the sort of policy that it useful for USA best companies. The paralysis of the current problems of Crude oil and pricing go the distance to help us understand why the victory of Ahamdi-Nejad and his government policy might have saved the business in Iran.

By Iroabuchi Onwuka

The Niger Delta Crisis in Nigeria, facts or fiction

by

Sampson Iroabuchi Onwuka

Bloomberg News and Information, British Broadcasting Cooperation, all reported on 26th of June 2009 of the attack on Shell property in Niger-Delta region in Nigeria. The usual caption was set in such a way as to suggest that something was going all over the place, that there was a serious case of unrest in Nigerian Niger-Delta region. The picture which the world is compelled to see as reflective of youth violence, especially young black youths carrying guns and machete, seem to be the only picture entirely available for the general public.

Enough cannot be said about the activity of the Nigerian oil companies. Hydro Carbons are found in the area Block OML 64 and 66 and Nigerian NNPC is been busy signing papers with a lot companies. In October 2004, deep-water block OPL 222 was auctioned on and appraised. Production is set to begin in 2010 and is expected to co-inside with 20% Chevron participation, 30% ExxonMobil, Nexen Petro will participate at 20% range.

We know that China reached a trade agreement with Nigeria that will lead Nigeria to offload 30, 000 bbl/d of crude oil in next recurring five years. NNPC has also engineered a 4 billion contract development of the so-called Agbami field of Niger Delta. Why any of these companies and deals are not derailed or forced to generate uncertainty in the area, why they do not make the news as usual and why it is only Shell that always speak of these attack seem to baffle the minds of the world.

For many years, there has been no singular evidence of a 'Shell on fire', there is not evidence of the so-called kidnap except for the scattered issue concerning a man who had refused to go. There are matters arising out of the area in terms of kidnap and these actions seem to have given some weight to the report of such incident in the whole of the region. Yet proper journalism which most Nigerians and in deed the world truly miss about Niger-Delta, would tend to question the staying power of the friction arising from this whole incident of Delta clashes.

The journalism concerning this Niger-Delta is seriously spurious, full of conceivable scenario which exacerbated by pictures of Hooliganism. These pictures burrow deep into the mind of outsiders suggesting a mass of social unrest in whole Nigeria with reflective mutiny of displaced hooligans desperate to harm White people.

We lack the Kaleidoscope of the whole agrarian area of the so called Niger-Delta, but this area is large and elaborate enough to mute the issue of rebellious few, rather it is getting muted by these groups through the lens of the journalist who are adding fiction to fact. We cannot pretend that such unrest in the area does not exist, that it exist means that it has a degree of accuracy, to the degree that it now exist in the eyes of the world as only a keel from the Journalist (reportage) who are widening the angel of the story.

No reporter pursue any story without evidence, and no self respecting individual accept these stories when travels beyond reasonable doubt. What is the truth in placing such a high emphasis on an incident in an Oil Refinery in Nigeria called Shell, when other oil companies owned by Americans are hardly scratched. The relationship between Shell and BBC is not entirely clear and how they manage to get these information is also not clear.

What we do know is that much of the reporting that exist on paper and online concerning this Niger-Delta is initially brokered to the public by very BBC. How can we suggest that the Journalism involved in this crisis has done more harm than good when the only way this incident has reached our ears had been through the same source. It is incumbent upon us and the world to seek out the true facts about Niger-Delta, to elaborate the whole issue and geography concerning the area and exact particulars of the area in the whole region of Niger Delta that the incident took place. Accountable is the motive in this whole Saga.

Are these not the days of Google Earth, Global Crossing and MapQuest? are these not the days of GPS (Global Position Station)? how come that these technology that exist in Nigeria and are used by BBC are not implored to get absolute pictures of the damages to freaking Shell facility and probable location of the incident.

Such attention is necessary since Nigeria and her OPEC friends would like to demonstrate that oil drilling countries are reliable for output. This will also indicate the interest about Nigeria whose 20% GDP is Crude oil, 95% foreign flotation is crude oil, and crude oil also command the 65% budgetary revenues are more than likely to agitate when the crude oil is interrupted.

Perhaps it was Ken Saro Wiwa who began to expose the issue of environmental disaster facing the Niger-Delta and began to use his tactics of armed resistance against Nigerian military seeking to make foolish his complain of Environmental rape. In the end, it was his death that brought the attention of the world to bear in that Niger Delta.

What the world didn't forget was the whole issue of civil disturbance in that area, but in torchlight of reporters, a new world of thinking and attitude towards the Villagers spurred. That new attitude serve as the basis of the conflict, it is not entirely a mistaken to suggest that the idea has turned out worse than imagined. In effect, what began as a fact in real life circumstance yield now some serious hint of fiction.

From the beginning of OPEC until now, civil disturbance in oil rich sections of OPEC countries had been a way to affect the price of crude in real time. From the Arab - Israeli war of 1973 that saw price rise from $2.10 a barrel in 1971 till many times the price, to the disturbance arising from the fall of Shah in 1979 which saw crude oil crack $13 a barrel, to the civil unrest in early 80's which led to the a barrel of oil at $34 a barrel.

The world of oil which Shell played a significant hand, had always been dogged by unrest and uncertainty which affect crude prices arising from such volatility.

It is no wonder that Nigeria which needed improvement of her infrastructure in terms of Refinery and output signed unfortunate deals with Shell and company in the late 70's, and the deal was constantly revised under military dictatorship in 80's, that in 1982 when there was problem with the rise and fall of that Crude by way of Britain willing to offer 8 dollars a barrel, sabotaging in the process the high dependency of Crude.

From Asset pricing and Debt repay position this was a deliberate attempt to force third world economies like Nigeria and Indonesia, countries relying on Shell and Company to build refineries for them in reverse into owing these British companies. Now the substantial preemie of return, which Nigeria would have anticipated from oil now fall in with new bills from these refineries as assets in recessions.

The facts remain that the prices were jetting of so fast in the world and from that volume and output, small third world countries like Nigeria, Mexico and Indonesia, fell into deep National debt with new constructed Refineries in their countries. With the fall of oil prices, the debts increased weakening in the process the fundamental structure and nature of the countries currency and unit of exchange.

In essence, the delay of debt repay for building these Refineries was set in order of 'continuous time' model on the condition that if it goes bad (that is, if risk of repay compounds; defaults), the currency of host Nation will redeem itself in terms of higher averages or equivalent on claims to uncertain payment. Why Nigeria became indebted to IMF was due to poverty of the country to maintain its payment. The debt compounded quickly leading to redemption of Nigerian debt by Saudi Arabia in 1982 by up to a billion dollar.

To repay arising from crude oil bust, more and more output was required, and more and more areas were cleared in Niger - Delta and more pipes were laid and more Refineries drilled from Nigerian Agrarian Niger - Delta. The result was a huge destruction of the environment, a consistent rape of the place where fishes came to nest and a presence of toxic materials in the water and around the region of Shell rig-zone. More than Shell, there were others whose home were displaced leading to an initial arms resistance and then a thaw of the relation.

If we say that a country like Nigeria need oil, we are suggesting that the dark psychology of quick kill in energy market has proven inevitable. The staying power of inevitability of high energy demand in a country with so much poverty cannot be denied, but how that investment in that part of the Niger Delta and business world seem to indicate a crisis allover the country and all over Niger Delta, seem a question we cannot answer.

What the article is indicating is that facts concerning incidents of the Niger Delta ought to be made auspiciously clear with evidence of attack on say a Shell facility, this should be done in order to avoid cracks into the story in the future. What we are also saying is that from such cracks there will speculations, there will be misunderstanding or misinformation, and 'there will be blood'. When blood spill other than oil, there are no degrees of inevitability and fiction ipso facto.

Nigeria is an oil rich country and her hopes for its citizens now and in the years to come seem to be the primary reason of its existence. What is therefore considered faithful to the survival of the country, for instance oil, should get more than adequate commission from the federal government of Nigeria. Given the sensitive nature of such News of the crisis of Niger Delta, it needs be backed by several third party.

According World facts book/Nigeria, the amount of oil these companies lift from Nigeria is not known. In essence, the fiction concerning Niger Delta is so troubling since the actual use of the information does not translate into real life circumstances.

If the Nigeria has wasted 40 Billion dollars from Niger Delta Crisis, it meets that so far the Nigerian government has failed, should this however continue with the rebel tendency, the price of such future failure upon the very fragile Nigerian Union, cannot be greater.

by Iroabuchi Onwuka

Sources of News about Nigerian market

My suggestions will probably differ from many but the under-listed info sites are very useful for your proper knowledge of Nigerian market and export goods. The market world is a crazy world of information that allows you to trade to oblivion. But nothing kills a trader and a trader apprentice much faster than the tendency to recycle existing information. One must be willing to try to get deeper and expansionary in other to survive the brutal and rip throat atmosphere of trading. The following is therefore a beginner's step

Energy information administration

Africa Energy and Mining

Africa News

Agence France Presse

Alexander's Gas and Oil Connections

Ap Worldstream

BBC summary of World Broadcasts

CIA World FactsBook 2001-2008

Dow Jones/Nigeria

Economist Intelligence Unit (EIU) Viewswire

Financial Times African Energy

Global Insight

Hart's Africa Oil and Gas

International Monetary Fund

Oil and Gas Journal

OPEC statistics Bulletin

Panafrican News Agency

Petroleum Intelingence Weekly

Rigzone

U.S Energy information administration

Global insight Middle East and Africa Economic Outlook

World Bank

World Market Research Center

These list first appeared in the Energy information Administration and some of them are mainly for Energy News but they provide additional information on the country.

Addedum

Thomson Reuters

Bloomberg News and Information

Nigerian Guardian/not a very useful business source but a primary source.

StockmarketNigeria...useful but not a primary factor

Businessday

Nigerian Stock Exchange

Nigerian Merchantile Exchange

Intellingence Africa

ITNEWS

Sun Nigerian Newspaper

CIA World Factbook/Nigeria

There are others which merit the attention of the general public but they are hardly primary sources saving for Newspapers.

It is not clear how these information technology can help any Nigerian since much of the
content is sometimes edited, perhaps heavily edited. For instance the open source of CIA factbook/Nigeria seem to contain much better information about Nigeria than majority of these so called sources. Such inability by Nigerian intelligence community to sift through bad new country might go the distance to explain the level of intellectual weakness of the country.

Anyone looking at the very recent incident with Shell will recognize that BBC seem the only one who released this information first before Bloomberg caught up with the news and then manage to cycle it. These are not the first time this incident took place in Nigeria but how the attarckers have managed to get away from the local government and the Shell security seem to confuse the general public. Gazprom is making her business attention known in Nigerian Liquified gas, yet the rest of the world seem not to understand why in all day of days when Russians, desperately looking for useful partners in the world, were looking to reconnect to Nigeria, the Shell facilities are of a sudden damaged. Until further evidence...I beg to move on the fact that something 'fishy' and 'mimi-scious' is going here!

Nigerian Market...No. 5b.

continue...

If the principle of economics is applied to Nigerian market at this time, Nigeria is a country that is going through what the Mexicans experienced in 1994. In essence, there is serious grounds for making the difference in current world using Nigeria as a bait. To be sure we can use Mexico as a an example.

In 1991 the world saw a major downturn in oil crisis. The boom of the years leading to the
Iragi and middle crisis had come to an end and there was urgent need in terms of oil and energy.
The boom in oil was briefly enjoyed till sometime in 1991 when the rest of the world began
to respond to huge linear investment in developing economies of the world. America was responding badly to oil shortages which led pressure to invest in oil rich areas of the world.
Then there was the issue of Super currency which third world countries had to deal with. Majority of that investment coming from United States went into Mexico shrinking in the process, useful investment in other areas of that market. Like the sort we discovered in Nigeria till April 2008.

By 1994 there was severe economic retraction in Mexico which heralded worldwide economic meltdown. At the time of the incident most of these American investors were forced to pull out from Mexico, envincing a crash of substantial proportion. When the world was ready to proclaim obituary to Mexico, when the investment nolonger poured in, Mexico began to sudden show life.
What crashed Mexico in 1994 was huge linear investment in the oil which forced businesses in many areas of the country depreciate.

The case is simply obvious in Nigerian market today, the country had gone through the problem over zealiant investing leading to all kinds of ruination of its internal dynamics. Of course, exact fingers cannot be pointed to oil but the rise of oil and petroluem in the last 5 years would have meant that Nigeria as a country would enjoy a useful profit to better its country but this was not so. Rather it suffered from people using the country as a business and Nigerian petroluem as a corporation that only generated the smallest sum from oil, smaller than most cultures of the world.

Then there is the issue of IMF and its bad loans which compound trade deficit, and then a scam baiting Super or premium currency.

Yet, Nigeria that is forloughly, may actually be the right place to be in terms of investment.
Since Charlse Soludo made the grave mistake of allowing the capitulation of foreign currency in Nigeria, there is serious deficiency of foreign currency in Nigeria, in dollar terms. The recent lending exercise of ECB, World Bank and in Nigerian case IMF, can be described as an attempt to resourcitate the debt to error of Nigerian parts, which can only further deny Nigeria this freedom to restructure its internal dynamics.

Yet the distance is much between the debt or loan to cripple and the weakening of Nigeria current market. The vultures will gradually return to Nigeria and under the current CBN, foreign investment that has no interest in direct investment in Nigeria will return. This is therefore the best time for commodity markets since they are little to win both ways, and will continue to be the case as long it is necessary.

Nigerian Market...No.5

One Senior market analyst, Jeremy Steins, once said in the relation to another domain options market, that "stock price volitility strongly mean Reverting" which if translated in market Nigeria should mean the following; short term options should behave differently as a reel on the prices of long term options should behave differently as a reel on the price of long term options. Gains on short term IPO's should mean reverting to an actual domain option after an expected business cycle of 36 months, albeit at lower percentage profit.


As far as Standar deviation in concerned with respect to range of expansion on a weak platform an population size, this is probable not true at least in market terms. Much still in market, liquidity markets like Nigeria, with very limited structural adjustment proved incapable to withstanding the barrage of business drama at the top. Bribery and corruption built a tunnel from top to bottom, unleashing as it were an avalanche of waste and military suppression in once promising economy.


Not barring oil and gas as a normal bias, Nigerian market proves a point in the immediate discourse. For instance, Nigerian market has consistently increased in the last two decades with an upside view of 10% annual rise in the next probable ten years. The New Government in Nigeria had been trying to set aside the problems of the past, while doing what is considered right by other citizens' standard. Until the recent government, Oil and gas rose in Nigeria as Naira dropped over the same period, meaning high and cur inflation capable of gaining psychological dimension as demand fell for imported goods.


From that 1986 Nigerian adjustment to SAP (structural Adjustment Program) and the idea of 'super currency' and IMF, Nigeria and foreign hedge fund managers went at logger-heads. Naira facing corruption and bribery and expense driven trade deficit which forced Nigerians into debt and compounding debt that forced Nigerian Naira into a slide. The drop was so consistent with oil that it was easily expected every Friday. Few began to wonder when such drop will mend, fewer suspected a compromise from the Nigerian federal government. With the rise of trade deficit in Nigeria and with oil exchanging hands from June and September each year, Nigeria Naira like most betrayed currencies of the world kept sliding till foreign businesses began to pull out, but the harm has already been done.


Exchange driven disaffected buyers looked else for profit from around 1986, leading to further devaluation of the overall economy. The blame easily went to poor fiscal policy of the government and its military weight and loan servicing. In no small part did the isolated incident of Nigeria took place only in Nigeria, it was a world wide economic problem. By 2004, the weight of the currency has depreciated from slightly over 5 Naira for 1 dollar to 148 Naira for a single dollar. Naturally, investors were discouraged to place more bait with such a country called and until 2004, market Nigeria dwindled under the axe of monopoly.


From that 1986 till the licking of Nigeria would in 2004, there is always the issue of acquiring distressed asset which usually occur when US dollars is at all time high and Americans who once backed the Bretton Wood will now cease the opportunity to spread their business. The rise of
US dollars forces currencies around the world to become worthless and then a penetration of American backe securities.


In essence, if you plan your market very well, it will revolve around around a circle, starting with the rise and fall of US mortgage and then US government backed intervention, a tightning of credit, a stronger US dollars and a weakened foreign currency leading to inflation like the problem in Russia. Like the problem Nigeria Naira faced in November which cause inflation leading to distressed assets. If they had released their distressed assets to foreigners, it might rehabilitate the circle of debt in future.


But this has no remedy in current markets in the world, but in Nigeria, there is a command to all asunder to invest now the chips are down. The circle would been fully broken with a few more years of Charlse Soludo, but his removal might be a blessing in disguise since eyes are now wide shot. Embrace Nigeria now and she was will embrace back. Embrace Russia if you can.

Russians on the Dollar side...good for commodity market bad for Crude oil.

Russians realigned their Rubies with dollars ahead of the meeting of the emerging market group on the very fuure of the socalled world reserve currency. The coin of contrast has been baited between European Euro and American dollars with many countries pointing to Euro as the next possible dump of the world currencies. The purpose of this meeting of these emerging economies of the world - Brazil, India, China, Russia - is if not clear especially, except in context of uncertainty of confidence hat such meaning spike on US dollars. A weaker US dollars will perhaps open more avenues for businesses around the world, which will further enhance the inflation of American economy. US economy is still dependent on markets from around the world (emerging commodity markets for sure) and American commodity markets still account for 70% of its market. Russians anticipating the whole drama indicated that it has no need for further meeting, and the country suffering from the year long problem devaluation of its currency will need to reposition themselves in US currency.

By taking so active a position, the Russians are beginning to indicate that they are likely to seethes with a better face on the rest of the world. The country has largely remained in the foreground since is days of communist breakdown. Making the transition from a communist state to capitalist require all the competence of modern financial giants from Russia, but even they had succeeded according to plan, there was Euro to deal it. The tension between Russia and Europe seem to be ignored, far less critical has been the improbability of a community of currency champions that include Germany and France to excel too far against Russia. In effect, it can be argued that the resistance level of most currencies baiting against benchmarks is noted by degree of participation of two competing forces capable of affecting the outcome. Such outcome that enhances the Euro against the dollars can be expected, it is unlikely to be desired for could anyone expect the Euro to replace American dollars by even a narrow slide even for a 25 years.

The purpose of this meeting of G4 emerging markets can only be explained as a diversionary ploy, intended to spook the rise of alternative monetary currency opposed to world financial Reserve currency; dollars. For now, if not for now, no singular currency is anyway positioned to challenge the US currency, which brings out the more useful question of why Euro will be seduced to promote itself given the expansion of balance sheet in Eastern Europe. For years, a rift has existed between Russian businesses and European frontier companies, like the landing rights of Luftansa and Russian Aeroglots. Structured characteristics of existing financial base of Russia and Europe make investment between these two power houses difficult, worse than all is the very recent fall of Russian Rubies which led to serious decline in stock profit for businesses belonging to European countries.

Europe seem too slow to gradually accept the inevitability of breakdown of its currency, despite the failure of banks in Eastern Europe and infrequency of payment, the continent an her ECB seem less concerned with huge trade deficit between it and the rest of the world. For stability pact to endure, government sponsored enterprises (GSE) should be relied less and less, in order to help the private institutions and indeed the world market to participate in such an open market. There should be a balance between risk management and assumption of debt. For the sake of investment, more private direct participation as opposed sovereign wealth is very useful, and given the export depended basis of European economies, there is no basis for expensive commodity market. Crude oil which the Russians are tagging to their wealth is however expected to peculate.

Here, in terms of operating commodity market of Russia seeking to barely survive the new fall of their currency, they seem to have done better by openly declaring their intentions to peg their currency with dollars. Given especially the whole world of crude oil that is likely to advance with an upside view towards the end of 2009, Euro is not a safenet. The dollar is, perhaps the pounds with newer and better realised tendency, needs to be mentioned that the Euro has performed in consonant with crude oil, its likely dip in monetray significance, might spell bad news for crude oil.

Nigerian Market...No 4

West Africa is deplete money market due to socio-political merchants of death, in respite, it lacks cohesion and integration and such local foreign investors look else where for business opportunity. Advance decline lines are not certain in its stockmarket and the moving average is only useful with banks. But if any one is willing to admit, West Africa and not North Africa is the model in studying business cycles in Africa, especially downtowns. Some analyst have mentioned that in terms of equity ratio, North Africa is key to the continent given the issue of the currency. There is no argument there that in terms of price and profit on the short term, North Africa is a useful investment option especially Egypt. If your investor is comfortable with long term penetration, Egypt and North Africa is not the place to be, rather Nigeria and West Africa is where the big business are. North Africa is very suffocating for outsiders and wealth lie in the hands of the fewer an not the many, and for that it is difficult to maintain a market to market agenda. What happens in any part of the world cannot easily affect the business cycle in Egypt.


Cyclical downtowns are not without origin in advanced economies, and individuals in-the-business-to-know will come to accept a forecast of bust as natural consequence when certain longevity of boom is overly-enjoy. With a market like Nigeria, investors easily move their money around from their money to any part of the world. While the case is not exactly the same with third world countries, yet in each expected fall in market value and price several indications had been underway and in response to inflation, Nigeria easily provide a command signal for would be business men.


In the whole Africa, the pulse of business life is easily associated with Nigeria, and Nigeria Nigeria participation with OPEC does not endear such advantage rather her membership ensures that U.S dollars remain the order of Nigerian market, a bait for Nigerian Naira and a hedge against volatility. Better argument can in fact be made for South Africa but the size of that economy and wealth of technology means her a distant calipher for measuring business performance in Africa. In Africa, South Africa is a less than perfect model for predicting profits in venture capitalism. In South Africa, the Bond market is very useful and can be a way forward for the most part, but it cannot be relied upon since the structure for the 48 Million South Africans are mainly constructed and the South Africa is Rand baited against precious metals like Diamond and Gold, means that there is little to be done in terms of its money function and international markets. America has long removed the gold from its standard, opening all kinds of way for international businesses.


On the other hand, Nigeria is closer to the bottom with a view of the top, with easy to start leverage for small businesses and geographical width to accommodate any size of investment.
By all accounts, both technical and historical, Nigeria is necessary market prism to seer the merits and demerits of investment in Africa, and as a cipher, it could help to spot the stimulus
of a new product and public interest.

There is tendency to believe that everything Nigeria is oil and given the whole problem of political instability, it is not difficult to doubt it. Oil is a natural bait for investment but these foreign legions sometimes ignore such thing as overkill. Wherever oil drilling is a major source of income, the economy thaw. The accusation that this is deliberate cannot be made since over reaction to any form of investment is a constant dark psychology in markets with little option trade. Since oil companies bring a source of new markets to these markets, an accusation of such proportion cannot stand. However nonetheless, its no hidden knowledge that huge endeavors without repose to the general economy invite a ship of decaying companies and unemployment.

The good thing about unemployment is that it helps to foster commodity markets and salesmanship. If anyone is interested in raking into Nigeria, it will be through the avenue of supply management. For supply to mean much in a third world like Nigeria, it must be generated land and sea. Lagos is the commercial capital of the country and Kano is in the North, what could however help your business survive quickly in Nigeria has to essentially deal on cost. Effective cost management to the most significant unit of exchange, set against a very effective supply route would easily ensure a useful return for your business in a decade or less. Like any good commodity, once you start making money, you are likely to remain on profit. The size of manufacuring anything in Nigeria is not as stiff as it is currently available in many parts of the world, but the temptation to import products in the country is usually met with stiff tariff which

It will also be a good idea to seek a direct investment in the country to enable you further improve your position in the country. Nigeria might be confronting the problem of 419 or 'obtain by tricks', as such it is better to deal with smaller groups and people from the beginning, and build over time than trying to force your way into the country. Companies like Nestle might be one of the best beverage companies in the world, but they archieved that level of success gradually. When Palm Olive wanted to do the same in Nigeria, they could not easily archieve the success and nearly backed off from the country. It is wise to forego some years of profit if you are heading towards Agriculture and you should try not to place a high emphasis on overnight success. If Spices, Coffee, Ginger, is your interest in Nigeria you should look to develop business relationship with the Northern elders and theirlocal Mallams. And you need a lot of trucks and full Residency Permit.


Nigerian and West African Ginger and Coffee beans are the best in the world, I mean there other kinds of Caffenited beans in the area. Take a softly approach, and take your time as well.


For bigger coperations, the Nigerian Stockmarket is one of the best investment anyone can think of. It is not in terms of the overall performance of its finances which is largely under-developed but its ability to attract the attention of the public - local and foreign - is a big advantage. Talk about going legit! In such terms, you need to have your trade stations and work gear and stay attentive to international markets as well. Other African Stockexchanges are not a bad idea but the main event is seeking to generate money in Nigeria using the banking system. There is always a commercial paper that make life easier for foreign businesses in any country and these companies can be of the greatest use as if you definitely need to watch what is happening to the Nigeria oil and gas as domain market. If these are done, you can begin to plot your entrance into West Africa using as a background.

The following are what you as a foreigner needs to first of all do in Nigeria.

1, get a better idea of the market called Nigeria and study the country as a whole.

2, review the trade routes and transport system. While you should not worry about the trade routes at the beginning, you need to master the nature of trade inside Nigeria.

3, You should visit Nigeria at least for a while and try to feel your way in a place like PortHarcourt or Enugu before heading towards Abuja or hectic Lagos. While you are it, you should obtain all the information you need about incorporating any business of your choice in Nigeria and make sure you accomplish that during your stay.

4, Tranfering some money to Nigeria is not a bad idea, right when you've done so, you should look build your credit with any number of banks. That will look like a hard task, but with time and the reputation of your company, it is possible to attract bank credit.

5, For any third world economy, you must start from little things but when you stand, look to avoid them. It is also pointless to dwell on something that everybody wants, and avoid the mistake of cashing out or cashing in, you must begin with something and try to build you credit with any company over there. The rest comes naturally.

People who get dupped in Nigeria are rich people who want break in bad and cash out bad. They might make it, but sometimes they end up falling into the wrong hands. Asset pricing and Risk management cannot apply in that whole attitude of 'breaking in bad' in Nigeria. Nigeria is still growing and will only approach saturation in a century or so.

Market Nigeria...No.3

Nigeria is a country of 140 million people span over 36 state with at least 2 million people in each of its domination. It is by far the largest market in Africa with upside potential so huge that it threatens the local market. The span out nature of the market make it easy for any business to take roots in the country and survive positively, and for commodity market, Nigeria allows small businessed to operate at a profit. In times past, these commodity markets are realised to the condition of bad markets. It can equally be said that these locals survived through the years because of the great connection between one part of the country and the other. For instance, there is the case of people travelling to very parts of the country who engage in trade, people travelling from the South East of Nigeria, often head North for season markets, vice versa.


The old trade routes are still very visible from say a town called Abakiliki in the East of Nigeria through riverine choke ends and harsh tread fair towards parts of what is now Taraba states, and then into hilly crest of what is now Plateau state and then a rainbow displacement towards Niger state where the Nigerian middle belt is reached. From such congruent towns and cities of the Middle belt Nigeria, we head North into old City states that was once an empire, and then further into Northern Nigeria where several markets exist on its own. In times past, in those days leading to the arrival of the English in Nigeria, Igbos and other minorities found between the North and South, travel great into these areas. The Yorubas began to do the same after the wars of slave trade ended, and the Obas of Benin began to plot thier own penetration using military power to clear parts of what is now Niger from hoodlums that arrested and waylayed small businesses.


Northerners, who were mostly from 'Zaria' known entirely in the south east, often wonder how these people from agrarian Nigeria, could travel these long distances with thier food items. Cloth materials and Jewelry are non perishable but how did the Igbos and other minority traders make to the North without horses? Igbos did know how to answer, but some Northerners began to suspect that commodity traders from the South mastered for thier own comfort, the trade seasons in the North, as such sold goods from the East at any market and acquired the cheapest version commodity items of what is available, which was maintained by long distance travel and communication, and which they empty for sale in a distant market. And on and on. Some Hausas dubbed the Igbos cheats and eventually Christians (non Muslims), but what was not known is that these commodity traders seeking some form of survival in thier business, had began to lay the foundation for modern Nigerian markets.




From that time till now, it does appear that Nigeria had been destined by posterity to survive as distinct people, developing in its capacity from each other in degrees of isolation, and with enough empasis on the sorrounding environment. How this overnight travel to several parts of Nigeria gave birth to some theme market in Nigeria like Aba markets (Ariaria, Abayi Umuocham), Onitsha Main market, Calabar Market, Lagos, Sabon Gari, Zaria, Makurdi, Kafachan. Of which reasoning, the country is still a market in progress and a big one for that matter. Given the modern development of the Nigerian market in recent years and the consequent development of the global world, these areas of commodity interest will mean a different attitude towards the world.





Yet the lines of communication in 400 towns and cities in Nigeria, do the honors in helping to explain the difficult problems with Nigeria as a country and as an empire that refused to rise. For certain, it can be said that those willing to ply Nigerian market now and any time in future, should be looking to expand their tentacles accross the country, especially since these markets are evenly distributed in all these member states. In the stead of the common practice of travelling from Aba to Oshodi and vice versa, and taking advantage of any current market as you travel, you can begin to map the regional stores in and around country which might require huge investment, only through which distribution can be easily maintained on an even keel.





In many commodity markets of the world, Banks play a great role in helping their market. In Nigeria, the Influence of their banking sector and CBN does not serve as a magic wand for growth. The reasons are no where confirmed to expense ratio but the devices for business regulation is seriously under-developed. Much can said about the poverty of the Nigerian banking sector, and despite the reforms and progress of recent years, the industry will have a problem meeting the cut for the first 50 banking countries of the world. There is a serious breakdown in the control and command sector and index department. A country with only 25 banks is not likely to survive the tirade of foreign involvement, however big. If information is anything to go by, foreign banks that have useful interest in Nigerian banks have done but steal from the country. For instance, Banks from Lebanon and from parts of Syria has more than weakened Nigerian finances market, shrinking the commodity markets to a basket of waste.





Huge oil reserves in Nigeria is for now her only bait for foreign businesses, but like countries of the world, oil reserves does not wager for any sort of economic growth. Energy demand world wide means that natural gas and oil receives an immediate attention. As often as we have come to accept investing in a rush, that attention driven investment sometimes shore off other avenues of wealth, leaving in its wake excess money in circulation. Money is still carelessly spun around the country, giving the false impression of success when it is largely not the case.





Given the weak infrastruction of the country and other under developed structure of its stock economy, banks in the last two decades have consistently outperformed other futures in the Nigerian stock exchange. In dollar terms, this is not much. It is perhaps surprising how Nigerian small businesses have managed to hang in there against the weight of Federal Government sponsored co-operations and her Armada of foreign energy investors. These foreign legions sometimes ignore such possibility as overkill, wonting from huge linear capital investment in liquidity markets. That is, pouring huge capital investment investment in one area like oil production. Hence the weight of foreign investment in Nigeria is of a darkly kind, since the poverty of its productive industries are quite evident, and when set against the recent trade deficit of the years, the market usually spurn an overreaction.





For instance, oil boom in the years 2002-2008, Nigerian markets experienced useful growth and with that growth, it experienced the problems of inflation. There is enough money in circulation, but it can only achieve little, and that by market standard is a symptom of underdeveloped economic structure and an insight into how to positively exploit the market. The Nigerian market is suffering a peculiar sickness of stagnation, which is familiar to many third countries of the world with energy related cash crop, all the more severe for Nigeria since the huge potential to move on is estranged. For that stagnation and poor market direction, the commodity market suffers.





Transitional strategy is a constant mobility exchange concerning a country's ability and inability over a given time to improve the lot of small business incorperated in the country. In other words, it is a process of guaging how quickly a country can transform its small businesses from level of economic class to another and how the private citizens responds to such shift. In any economy in world, this attempt is scary stiff and when it succombs to its inabilities and inaccuracies, it eventually sponsor a culture of naive investing and rip off, and sometimes inflation. Such excesses attract financial 'vultures' from all over the world, bringing the doom much closer to the poor people whose Banking structure can neither protect nor retain the survival of their market.

Market Nigeria...No. 2

The Nigerian market is a history by itself and that history deals more on the lasting impact of a colonial occupation than a newly independent society coming to the terms with its new sense of identity and independence. In essence if anyone is willing to chart the peculiar contours of Nigeria as a society, he or she should look at the society from the standpoint of history, to question the very nature of Nigeria as a country and state before the very undue influence of
British colonization. However, the actual impact of that English society on Nigeria has no full merit in history unless we understand Nigeria from a market perspective, not only in history but Nigeria in terms of its market.


Nigerian market sets the tone for the rest of Africa, a fact that cannot be justified in the context of modern history. It is a argument that slave trade was a form of business that took place in Africa where Europeans and Arabs before them, bought and and sold slaves in Africa. In West Africa, it is also said that the area developed only to the tune of Europe. The issue concerning the 'scramble for Africa' spells it all out, on how the one continent Europe divided Africa among themselves. We cannot pretend that did not take, neither can we speak of the effect of such an enterprize, rather, the attention of our commentary of that area is how the evolving competition of the prized companies raise the tension inside the African continent. Even today, most West African countries are still isolated in thier own world and have. no reason to insist of connecting thread lines and cultures in different parts of thier world.


If West African market is not complicated by the Era of 'slave trade' is a world of businesses
that has not fully been explored. The side result of that of slave trade is why African market remained for many years outside the total grasp of the world. Its geography is not entirely unknown but how the people of Africa promoted their own business. Indeed slave era form backbone of Markets across Africa, especially West Africa, it was so because of the companies that made it to West Africa after its wake from the slave era only had to deal warring tribes. Nigeria is a country whose market were truly affected by the chores of colonial influences in the last 500 years. The key to the states is through the interconnection of the states. Beginning with the Business people of English retraction, who in reality were the last of 'Mohicans' and perhaps the most lasting of the whole influences. The Nigeria is a country with over 130 million people spread across 36 states with at least 2 million people in each of the states.


The machination of Nigeria began with F. Lugard and George Goldie leaking their wounds of a defunct Congo converted gold mine with a British conquest of Kano, one of many Fulani states, North of the river Niger. By 1908, another British history victory over the south in 1908 and the east in 1907-11, enhanced a British staying power and thus proving a reason for amalgamating the North and the Southern protectorate of Nigeria. Hence Nigeria as a country had been intended as an administrative device to penetrate West Africa, by so doing, Nigeria proved an industrial haven for cheap labor, where English fellows trained and paid their workers very cheap salaries.


With a population heritage of over 20 million, workers were easily replaced. Yet with French colonies around Nigeria all seeking business connection inside Nigeria, with ancient travel routes in and out city states around the country, with several Apian ways connecting coastal high lands coast lines and river choke ends, Chiefs, Emir, business men and women, and smugglers were able to raise their game to a level. To manage this infraction, pounds were introduced much later for all asunder as first a tempter to legit all business endeavor around colonial Nigeria.


From a rear view, it is possible to that local traders were playing with masters of world trade at the time, and doing legitimate businesses with colonials easily acceded to taxes an border control. Under the condition that many towns and villages in and around Nigeria where surrogate to ancient and belated modern empires, market communities around these old towns developed sluggishly, evolving without repose to each other. It would have been impossible to know what was happening to other parts of Nigerian markets except through a circular body. This circular body was an English government. The foresight or shortsight of George Goldie.


The first of international companies operated in Nigeria was founded by George Goldie called East Niger oil company, naturally owned an English man, an England Jew. Then came a flood of other companies, including a Tin co-operation. Nigeria had Tin, which is 1929 lead an American president company presented to Calvin Coolidge. However the most important export of the Nigeria market was the Palmoil from the Riverine areas. Yet the deep roots of the Nigerian market lie in isolated market centers which was at some point and the other were homestead of older Nigerian empires. In Africa there is a history of empires rising and falling, but the residual effects of these areas which once served as major points of Nexus of contact, such empires now left as residential areas become the basis of markets.

There are 400 cities and towns span across the 36 states of the country called Nigeria, these areas are not connected to each as such market progress is very slow. If Nigeria had eight old West African empires from North to the East and their world will need to connect to each other. This is how the Nigerian market make sense and how that will it can be penetrated, spreading your market net to the whole states and then seeking to maintain supply.

The Dollar Crisis by Richard Duncan

Book; 'The Dollar Crisis, the Causes, Consequence, Cures' by Richard Duncan

Published in July 25 2003

Publisher Wiley and Sons

New York, NY

ISBN - 10; 040821027

Review by Iroabuchi Onwuka

Introduction/Theme

The theme of the book is to warn the rest of the world on the coming danger of global crisis. This crisis will begin and end with the Dollars, and it is up to Americans and the rest of the world to heed the warning that trade deficit was making and hedge against the disaster.

Outline

The outline of the book is set in four parts.

Part 1, deals on "the extra-ordinary imbalances in the world Global economy and explain how they came about"

Part 2, deals on Global economic "disequilibrium"

Part 3, "severe recession in the United States and elimination of the U.S" dollars.

Part 4, "results from the imposion of a world wide credit bubble"

Overview/The Body

From all intended purpose, the book in question which earned the respect of many business analyst seem to dwell mianly on the middle of the controversy concerning the rise of reverse assets sice 1971. The weight of the matter is entirely placed on gold which for many years served as a means of foreign currency with direct respect to the United States. The simple logic of this whole idea is that existing perform niche of a country like the United States can obtain a stay of foreign currency in the US with direct dollars participation of their exchange of the dollars. The staying power of these countries depositing in the US is the bait on dollars which acquired its useful weight by view of its parallel to gold standard. Then lending practice of 'accounts receivables' and the major issue concerning (IOU). The role of gold is not to be taken for granted, not only gold in terms of intrinsic value but gold in action.

The composition of Reserve Assets according to Richard Duncan is as follow,

1, The monetary gold

2, Special drawing

3, Reserve position in the fund

4, Foreign exchange

a, currency and deposit; (i) monetary authorities (ii) with Banks

b, Securities (i) Equities (ii) Bonds and Notes (iii) Money market instrument and Financial derivatives.

5, other claims

Current monetary problem of the world in the much of the world has grown to export to U.S than import. But we can then argue that America's market is far more competitive because of this as such the verities on trade deficit is on a sign of shortfalls in business but perhaps not the main problem. Japanese trade deficit or large trade deficit does serve as an example for the current problems with the United States . In Asian market there is a much better example of the issue of trade deficit "Thai corporations found they could raise large sums on the international bond market, and foreign banks became increasing eager to lend in Thailand. By then, much of the incoming capital was in the form of "non-resident deposits" is short-term "not money" deposit in Thai financial institutions in order to benefit from the high interest rates on offer there. Equities investment also became increasingly short-terms and speculative in nature." Between 1986-95, the Thailand has a gain in 400% stock price - had lost 95% of its dollar term value. 1994 tightening of interest rate did not stop the flood of lenders.

Duncan also cited the case with Japan's case of trade deficit that it was overcapacity, that it was industrial capacity utilization, but it was also their linear investment inside the U.S market. The whole exercise is driven as a hedge for their currency. Duncan used the example of Jacques Rueff, 1961 of Fortune, "the functioning of the international monetary system was thus reduced to a childish game in which after each round, the winners return their marbles to the losers." If this piece is that hard to comprehend is because the whole meaning of international market is not fully understood.

Here we can inject that the very explicating of Duncan in international markets that "more specifically, the process works this way. When the U.S has an unfavorable balance with another country (let us take as an example France), it settles up in dollars. The Frenchmen who receive these dollars sell their to the Central bank, the Banque of France, taking their own national money, Francs, in exchange. The Banque de France, in effect, create these frances against the dollars. But then it turns around and invest the dollars expand the credit system of France, while still underpinning the credit system in the U.S."

What is happening here is that U.S was commercialising its power through the dollars. This was no game, it was the only way to help. Money the author tend to argue that the nature of excessive credit was due primary to large inflows of currency from different parts of world into U.S, which the banks had to use in other to lend. Easy credit was due to large inflows into the states.

Duncan however argued that in refference to GDP that "credit could not have expaned this rapidly in absolute terms or relative in GDP had the foreign capital inflows not drive up the money supply as it entered the banking system", and the reason was that "taking one step back, the foreign capital inflows would have existed had they not been created by the U.S current account deficit." He believes that it was industrial over-supply that led to the excess capacity of 1926 and then prices began to fall. This arguement is clearly wrong, the balance of value is on U.S currency.

International liquidity occured due to problems emerging from general lack of market direction. There was no value especially currency to speak off upon which all other currencies were measured. As such people did as they wished printed money as they wished. The U.S transfer all of which lacked value, what filtered into the world. We can agree that (a) consumption expendation (b) private investment (c) government spending (d) net.

The breakdown of GDP of 2002 will show that

(1) Gross domestic product, 10 082 personal consumption expenditure

(2) Gross private domestic investment

(3) Net exports of goods and services

(4) Government consumption expenditure and gross investment 1, 858

Conclusion/Summary

In the past gold was the sure sign of value leading to the war which became the instrument of action. Credit contraction would cause a recesion and prices would adjust outward, especially pegged for certain currency. The trade deficit is unavoidable. There is also the issue of Sovereign debt if the soverign wealth is used to extensively acquire real estate within a 'particular sovereign' market. The market experiences serious contraction which will jeopardise the market unless. From a world of mergers and acquisition, Enron, Global Crossing, Worldcom filed bankruptcy. Author Anderson one of the big four was happy to destroy the document that will implicate their accounting at Enron and the largest bankrupcies in the United States.

There is the debt versus income and there is fall in personal savings rate. Total consumer debt on bankruptcy filling trends. The movement from credit to debt "in absolute amounts. The government publicly held debt peaked in 1997 at US $3.8 trillion before falling back to U.S $3.4 trillion in 2001." The office of budget and management has forecast a deficit bonds. Speculations on China by the author..."if the banks continue to extend credit aggressively the cost that the government will have to bear to bail out China's depositors may quickly exceed fiscal policy resources if it has not done so already."

The political economy of the 20th century for example

1, Central banks

2, Paper money issued by governments

3, Income Tax

4, Fiscal Stimulus

5, Steel Tariffs

6, Agricultural Subsidies

7, Child Labor laws

8, Minimum wage laws in the economy advance countries

9, Anti monopoly laws

10, The international monetary fund

11, all social safety nets, including the U.S social security system which is neither Lassez faire nor solvent

Nigerian Distressed Assets...My Solution

There is a danger in letting foreign institutional traders or individual investors acquire distressed assets of any country especially an expense driven (commodity based) economy like Nigeria. The danger is best explained in the nature of current 'debt to equity ratio' of most Nigerian business, that where supposed to be great companies that rose beyond their estimate in the past decade and now had to deal with the problems of inflation and default. The bigger the company the more distressed its assets and now some of them cannot afford to survive given the decaying nature of Nigerian bpp.

Capital gains profit in emerging third world countries is so striking correlative to their stockmarket that shortfalls in its marketplace easily acede to fear which more or less proclaim
a lasting expression of its asset class. In essence what represents the overall performance of
any country's asset class are not only matters of profit and dividend but can be affectionate to matters of default on payment. Markets differ from one and another and for profit to be certain grade. How this is measured is one of emerging market systemic problem but it is a function of external derivatives, including national debt and currency flunctuation.


Most emerging markets especially have to deal with this problem of rate and fair value and it
is usually a pitfall since the system unbeknowest to them often imply their demise. In essence
a country's misfortunate are sometimes relative to thier level of sharpness and training in managing transactions that are not very clear to them. For instance IMF as an ambitrage to Nigerian CBN will always insist on direct capitulation of a certain currency of conduct or order
of market in our country, in this case the Euro and by association, the Dollars. If this trend in bulked the host country like Nigeria, blinded to the foolishness of European anchor for Naira will always lag behind these currencies and dimiish in value with or without imput from outside market.


If say 7 Billion dollars enter Nigeria via commercial papers like Western Union, Travellers Check, Vigo, Eastern Union and capitulated in Nigeria in Dollars and Euro, then statistically the
'currency' of capitulation will always gain against the host country say the Naira and Nigeria.
Foreign capitulation in Nigeria is one of the grossiest aspect of our country's Naira devaluation whose end result is a fountain of distressed assets. The impart of this sort of deal is not very clear unless you understand that price is a function of the market and performance usually estimated by 'distressed assets' and default and also the true function of the stockmarket.


This will make the saying true that 'existing trade-able (tradable) assets' are directly equal to existing market which simply mean that the fair value of our market is the estimate of our total
distressed assets. Total distressed assets are the direct consequence of weak internal dynamics of any financial structure. But naturally currency flunctuation in Nigeria reflect the overall performance of the Nigerian finances market, hence its value. That is if Banks are 82% of the total financial market in Nigeria, then the price of these distressed assets in foreign hands over a Bank dominated market become 'inestimate'.


There is the issue of Toxic assets which are completely which are completely different from distressed assets and that matter of difference is clarified by the fact that you cannot rescue a Bank by existing its distresse assets from balance sheet. You can help Banks through acquisition of Toxic assets and if this acquired by foreign institutions they could be subjected to 'bid ask' and to market forces a commission to reverse auction of abandoned properties as a way to sometimes hold on until there is redemption.


With distressed assets, we are dealing with companies that are still dying facing decay but not yet entirely interred. These companies still worth something by market value and as such the country of its stay can still overlook it. The truth is that the signs of decay are not visible and probably do not exist but can become infected by the take over process and by hostile bidding enironment. Banks are still in possesion of these assets and would mean a useful penetration of operating finances if there is a friendly vulture party seeking to totally acquire the distress. Secondly there is no end to their bad market wishes and the contracted party can abandon the project and do something else if they chose. The issue is still non binding.


It is not easy to do without the other unless you look at a distressed assets as 'toxic assets' in process. Unless you also see it from the damage that interested companies could do to say the Nigerian oil and gas. The exchange bargain if you understand its deals would involved trading on top the margins, a dangerous penetration of Nigerian cash crops. As far as the companies are concerned, they are not saved at all, but it is good to remember that in good times, these distressed companies were very good but given the temperature of financial meltdown they have become entirely worthless especially due to crushing weight of a very strong dollar.


If the Nigerian government had made the mistake of bailing out banks, the hammer on existing Nigerian businesses would be harder. After a 6-9 months of expenses, the Nigerian businesses forever tied to IMF would fall faster. Since there was no bail out, the currency loses externally but become poise to recover its weight which might slowly but gradually re-tool retail investors; the grain and 'carveat emptor'.


If the Central Bank of Nigeria had contacted a company with such interest on Nigerian 'distressed assets' , they should be warned that this should not include foreign capacitors. It should be a 'bid ask' only open to registered members to registered members of stockmarket. That is when there inflation, a Darwanian 'gorilla' in any market is better than any 'vulture' and any bird of prey. If Central bank has done the deal, they should derail the deal on the condition that Nigerian Naira and CBN is still satelite for IMF.


In essence as far as Nigerian markets are concerned poorly represented Naira is equal to the value of its market. Unless the country doesn't know the vast im plications of such move then we are dealing with our inability, but from what seems like a friendly deal of foreign bail out, Nigeria will be put under a knife that he will never recover from. For me I have never heard of such thing as friendly bail out. It's a trap.

1,
My solution is that Nigeria has a perfect oppotunity to creat one or two MBS and ABS in the country which will be different from the treasury division that is presorted to acquire Toxic Assets. We need a kind of Fannie Mae, Freddie Mac and other sorties that can independently manage federal guarantee loans coming from part of fiscal budget with a view to acquire 'distressed assets' and the option to convert any distressed company's 'preffered' shares into common shares and vice versa. This is not a perfect solution but it is a 'safety net' given the economic jinx. As long as we participate in OPEC, there is no need for arbitrage especially those coming under the coy of 'foreign bail out'.

2,
Banks should make public their distressed assets and allow a full position to be taken, either to auction off what is existing at open bid or find private muscle within the Banking institution to engineer the restructure. You can use collaterised baits and extention clause.

3,
When a market is overload, innovate, avoid the surface expansion; penetrate the local market, sink deeper. When Banks are dealing with bad companies, they should creat outlets, build bridges, move business to a different world, try America, try Europe.

Sunsetstudios@hotmail.com

MarketNigeria

MarketNigeria is a group of managers working out of Nigeria with a view of making money for over sea companies interested in Nigerian market and Africa, through expert advices on investment procedure as well as managerial function on overall portfolio.

These are graduates with up to 20 years of business management and some graduates with up to 3 years of banking and money market experience. These managers are seriously looking for investors interested in making money in a high yield and relatively low risk market like Nigeria. The capital base requirement is as little as 10 000 dollars and I million dollars. Not much.

These are not brokers per se rather trading partners and multi-ferrous enterpreneurs ready to expedite your interest in money yielding area of the Nigerian economy. Should you be willing to indulge their endeavor, they can be counted for investigated inquiry into any business in Nigeria and can provide profitable counselling against any hint of contamination. The website that will make this very possible is seriously underway.

Corruption and mis-management is old and new problem with third world countries, especially liquidity market like Nigeria. The problem is not without solution and 'micro financing' which the central bank of Nigeria initiated under 'Charlse Soludo' is a slow but certain exit strategy for any company based in Nigeria. Yet hands on management from individuals including young university graduates willing to effect a new direction and attitude for their career, will serve to endear investor confidence in this nearly devastated Nigeria market. There is nothing more important than a one and one business relationship. The commitment is there, not the capital.

Initiate your interest.

For additional information of how to play in Nigeria and in Africa, ring the number 646 425 9712 for Iroabuchi Onwuka. You can try Iroabuchi Onwuka Sunsetstudios@hotmail.com attention 'business proposal; Nigerian Challenge' .

The Demise Of The Dollar by Addison Wiggin

Published in 2005 by John Wiley & Sons, Inc.
Hoboken, NJ
Pages 198
+index pages, 218
ISBN (0-471-74601-0)
Price $16.00
By Addison Wiggin

Review by Iroabuchi Onwuka

Introduction.

The opening version of the book is a summary of the downfall of the US dollars in the past few years, a downfall which the author argues as the side impact of removing the US currency from the Gold standard. In August 15th 1971, President Richard Nixon removed US currency from gold standard making it possible for the Dollars to determine its own value. This sort of currency is called 'fiat money' when the 'currency' is not under any backing, for instance Gold. US federal reserve note is a not a certificate that is redeemable through Gold and Silver, and through a form of certificate.

According to Mr. Wiggin "the official reason for going off the gold standard was to persuade U.S trade partners to peg their currencies to the U.S dollar - in other words, it was an attempt at getting foreign governments to realign their currency values". Addison Wiggin from the above statement is making a case for gold, how gold can prove a monetary hedge for any major currency in the world. While this is not a new idea, there is a general conviction that with gold we can help to place a form of measure for any currency in the world. Yet by removing the weight of Gold on the currency, the US unit of exchange will go the distance in finding its weight in the common market which where its muscles are respected.

Body

The author did not make the connection between gold and market fuction of the US Dollars, that he hinted on 'wages and price' which could suffer from setback of state control, does not mean that he believed that currency and its weight can have additional meaning outside the prevailing market. In essence, the book which began on such lofty platform as trade deficit, somewhow did not end with a case for Authur Burns and the new world market of functional value which is still misunderstood.

If there was the fear that "the currency exchange between U.S dollars and European and Japanese currencies was a drain on U.S trade" then the gold paraire which the author argues for, cannot be maintained. Gold is still not the best available barometer for value, that it serves as an international measure means that Gold is expected to redeem itelf through demand and therefore value can be used at the convenience of the user. This does not however mean that gold as a valuable metal was by itself a weight of some significance, but in the end there is a general faith in the market forces which will redeem whatever significant value is placed on a useful market and its equivalent for the gold.

Therefore Gold is a function of the market only so far as price is concerned, Gold is necessary to hedge against trade deficit because of its unchanging nature but the metal has no power of its own. If the world intend on moving its market forward, it will allow and encourage the participants of the world common market to compete freely and that will mean that the total amount of useful goods or marketable goods, will represent the supply weight of the country in question. The essence of removing gold as weight for paper currency and silver as certificate is to permit the rest of world to do jut that, to freely participate in all others' economy. But in Wiggin's estimate, the whole effort resulted in the crisis of USA Dollars.

Addison Wiggin made the argument that US had a great control over the world economy after Bretton Wood in 1947 and in 1948 and that helped their penetration of half of the world total economic output. For that reason, much of the world in 1971 were still fighting 'under production' when the doors of internatinal businesses were opened. Countries of the world had to measure the advantage of placing the weight of their currency by placing it in USA dollars and this, Wiggin insisted, led to the large depositing of these foreign currencies in US Treasury swelling Sovereign wealth in the US, compounding the American trade deficit.

When the US Banks have excess of foreign currency, they began to expand the credit limit and that naturally inspire inflation and then a bubble. In essence Wiggin was at this point levelling out the condition for the eventual bubble bust of the US economy, which eventually took place in 2008. Yet he did not make the argument that credit, both easy and tough, could bring down any economy. It is therefore a commonplace statement that easy credit is the very cause of bubble busting, as such Wiggin's argument about 'the demise of the Dollar' due entirely to extentive credit limit is a normal bais going to the beginning of the Stock and Bond market, and such has no connection to the trade deficit and removal of gold standard for US dollars or any currency. This does mean that Wiggin should receive less credit for pointing out the possibility of credit debacle in USA given the exuberance of lending.

Yet the whole book is about the problem of removing that gold standard which led to trade deficit in USA. Connecting that short position on credit to the problem of fait money also failed to take into account that only 10% of US market is credit worthy and S&P remain out of reach of most Americans. In 2008 bubble bust, the credit default was 5% of the 10% of Credit market as such the fall of the US economy can be easily linked to a natural process and less than natural, it was other countries inability to compete freely in the international market. This does not lead to free floating of dollars nor its demise, neither does it encourage over capitalization. Yet it will seem to contradict Wiggin since it is happenstance that depression or recession are signs of uner capitilization, hence a 2009 remedy of economic stimulus. The supply side economics should have levelled price which did not happen inspite of the open trade policy, and that a whole ground case that not everthing international affect markets in the US.

Wiggin said "removing the U.S dollars from the gold standard was an attempt at solving the problem of falling currencies overseas" but this does not mean that the gold standard caused the falling currencies in the world. Wiggin continued that with his examination of Japanese economy and its experimenting with credit in 1990's compunded their woe, since the Japanese acquired much of US dollars it was bound to the difficulties of the trade deficit as well. This issue of Japanese is of great importance to Wiggin since their "problem demonstrates how currency values affect not only the host country, trading partners as well".

Wiggin said that "if Nixon had removed the restriction on gold value at $35 an ounce and allowed it to find its value in the open market, that would have done more to fix the international monetary problem" but here the reader will nearly missed the point unless he or she was paying particular attention to the issue of price per ounce, where trade and productivity become the dynamic function of an ounce of gold. Price in terms of dollars instead of gold is not really his argument but we can include the 'thread binds the ledger'.

Wiggin argued that "if we recognize that currency is simply a form of IOU against the value of goods and services we exchange, then we can see why the tables have turned". By this he was entirely projecting that American dollars and economy was due to collapse from many years of trade deficit. Trade deficit is supposed by him to affect 'productivity charge' and this will crack the width of productivity wide open.

Wiggin is right that government manipulation of wages and price will not effect transition needed in any economy nor stop inflation, but he is wrong that the large deposit of foreign currency in US banks will increase the culture of lending and hence a bubble. If the culture lending is trully exploited, then there is no far of Sovereign Wealth and no limit to market expansion or productivity given the constant mobility. Credit becomes a problem when productivity stagnate within a given market and become linear due to emphasis on a given sharpe. Yet we can argue that the attempt to freeze price using gold...is not only weak, it is entirely useless given the primary price function of market.

If price function becomes the order of market as opposed to Gold then the market is entirely useful to existing level of productivity in a specific market, only to that existing level of productivity within that market can any value be measured in terms of the other. If the productivity is entirely outside the competition of the free world, it has no business crashing the market when the gates are open since competing market forces existing in a non free markets would be forced to apply in terms of gold. That the world can move on with their trade and gold, and another, with enough resources of gold, can crash it they choose. That is implying that gold can stabilize the world market but the world cannot and trully function with gold standard.

Conclusion

If China is expected to replace US in the long run as the new power house market order, they are far from such target since their "wage and price" controlled by the state simply make them a communist country and such not useful to capitalsit economy. Wage and Price becomes the missing link in Wiggin case on the 'demise of the dollars' since wage can survive in terms of gold and interms of 'inflation' but in terms of price and market, gold can be a hindrance. The second Achilles foot in gold is that currencies differ from any other so does market, as such the circumstances leading to a particular acquisition of gold in a any market cannot all of a sudden apply in the common market where an ounce is pegged to the nearest dollar. Then there is the issue of form versus function, form can be given the sprite of 'potential value' but what make market useful is value in action, the function value which is not gold. This idea should only apply to gold, but all goods and services involving different markets of the world and price. If there is any basis for all the trouble of today's market, it is the collapse of market value, the crashing of one market by another, like India, Brazil, Russia, China, crashing capitalist economies

What surprised me is that the Wiggin in question, whose book earned the stripes did not indicate the problem of Euro and European productivity in the lieu of current problems. He cited that "the belief that productivity growth is the whole deal is delusional, but as an economic principle it is unique to American economist...." in constrast, European economist rarely mentioned the notion, and according Wiggin European economist "know about the importance of productivity growth, but they view it as part of a more important trend, capital investment" but he didn't not make the connection between existing market principles/values in America and the asault on that value by a no holds China, neither did he indicate that existing conversative values of European market and its unity franchise of currency notes, has no form or function in current world market.

The 1933 great depression was supposed to have caused shortages in gold, leading the emergency Banking relief Act of 1933. There was trade gap, the IOU trade deficit got higher, it added to national debt, the more the notes (IOU), the lesser the value. Then there was budget deficit driven by low interest rates. Bretton Wood is the creation of IMF - a brain work of John Keynes with initial backing of Europe (8.8 Billion) but 1948 given the employment facing the world, the issue on gold as a weight for lending, against the ever expanding became official.

Yet gold is a rich metal; a form wealth but metals do not have an 'intrinsic value' - its 'intrinsic value' is entirely a question of market value, subjected to "the trend of productivity and fed policy". The same argument can be made about oil. Oil is wealth not money, and the value for oil is dependent at least on China for growth in the new ten years. It does not mean that the value of oil in any part of world, like US and Europe should apply in China. It is rouge marketing. Between 1948 - 54, United States gave 16 Western European nation $17 Billion in grants many of them are part of the Euro.

President Lyndon B. Johnson "the world supply of gold is insufficient to make the present system workable particularly as the use of the dollars as a reverse currency is essential to create the required international liquidity system world trade and growth"

"if gold insn't a bargain, what is it? Jim Grant, editor of 'Grant's interest rate observer' 'however, in my opinion, it is a hedge bargain. The value of a hedge should vary according to the cast and evidence of the risks being hedged against. In the case of gold, the risk are monetary"

Euro Currency will not make it

By

Sampson Iroabuchi Onwuka


Euro will not make it and I expect it to break up earlier than you think. I believe the currency had to go since it posseses the dark roots of our current problem of devaluation in global stock markets. The optimium currency will not survive because it levelled out the playing field for would be users, making it impossible for the lines of profit to loose contrast in one member state and for all 16 countries.

Ireland, Greece, Croatia, Hungary, Bulgaria and other East European countries are all in trouble. The question is was Robert Mundell correct in his assessment of unified currency or was he in any to blame for the problem of the Europe? Why would these countries who did so well in the past crumble so fast? The answer is this simple, these countries were export depended countries whose existing market forces had part of the overall global market, still in part existed for at least two hundred years. It is part of an on going recycle.

In a essence, if the market co-efficience of the normal world say X is acting outside the current market co-efficience say X1, so arbitrary market function X minus existing market co-efficience X-X-1. The differential equation is demonstrably inverse, which will be X+1. In order to remove the arbitrary nature of the negative market function, you can set function to X(x-1)(x+1) the resulting answer will be X-1, X-n, where n is any number of states.

Bringing these countries together would have been a way forward, but the rest of the world did not disintegrate so the absolute value of X for the rest of the world remain the same inspite of the excision. So you are looking at X-n16 equation, where X is the absolute value for recurrent market condition, and X-n16 which is the Euro becomes an independent evolution of a variable within an absolute X equation. Call it a self destructive Virus.

So the mathematics is wrong from the beginning, and would in teh long run developed its own agenda were it not for the attempt to preserve existing market forces preeminent in these markets, like Tax, Mucipal bonds, Fiscal Policy, and so on. These operational forces are set individually by member states, with or without influence from the other groups.

What happens when you do this is that you roll the clock backwards, for instance Soveriegn Debt and Wealth existing in bigger countries like England, France, and Germany become seriously disaffected to overall income capacity and disproportional to existing member state or member states. As such what happens in any of the member states will easily carry over to her neighbours without creating an interactive equilibrum.

If opportunity is levelled out with an optimium currency, at the same time existing power magnates like Germany and France are exhiting disaffective symptoms, then market on one side of the continental channel like East Europe is forever straddled in between thier regional balance sheet and thier the power brokers from Western Europe.

For instance, most parts of Europe as we know it are saturated by Banks, but much of these banks are default on payment owing to huge inflationary pressures, but 60% shares of Banks from East Europe to begin with are owned by Western Europe, which before 1999 introduction of the optimum currency was a way of copuling and decopuling and archiving stability.

In good times, East Europe was measured by standards applicable in the West to begin with and, even when it is more obvious that standards of living are different, East Europe survived on their own. But as soon as the whole continent of 16 members began to level out play, the economic nerves already evident in these countries created inflation and inflationary pressures. While some parts of the West Europe had power to survive, East Europe couldn't, they could not have given the ballade of economic strenght coming in from teh West.

When times became bad, the default on this Banks in say Eastern Europe became what someone called double default whose rate is fitted into West European banks. Then came the issue of American economic breakdown, which altogether compounded the problem of Europe making it impossible for money to shift ground in Europe. But why? why did all these take place? why did a once vibrant European economy suddenly divulged, then plummetted? This is the question I will like someone who knows to tell me.

Euro will not make it and the earlier they realise that this is the case the better for the world. ECB should think of Euro in terms of grouping strong currencies together with a sharp window for interaction called 'stability pact' and a door called 'guaranteed credit', an exercise no different from uprooting old trees from thier base in order to transplant them. If they were still nursery it could have been possible, but the roots are well fitted in thier stead and had yielded fruits in thier own home. The hope of uprooting this plants to transplant is a good endeavor, but by so doing the plant give away its essence and then its decline. But do not act surprise, since it is only the case, that old roots rot in a new field.


Iroabuchi Onwuka