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November 26th, 2009

A nation reconnecting on the ground

Posted by: Nick Carey

ST CHARLES, Illinois – This has been a voyage of discoveries.

ROUTE-RECOVERY/

Not least of which has been the mere fact that we were able to pull this off: 22  consecutive days with a minimum of 18 hours work a day. We traveled and conducted interviews all day before working late into the night -- only to start all over again the next day.

I am lucky that everyone who accompanied me on this trip from start to finish – Sharon Reich, Lucy Nicholson, Carlos Barria and Brian Snyder – are all true professionals willing to put in whatever time it takes to get the job done, not to mention lovely people.

But the biggest discovery has been one I have been able to dwell upon only since returning home. When you’re on the road talking, writing, driving and planning the next stop, there is little time for genuine reflection.

That discovery was that everywhere we went people were in the process of working out where America goes from here after two illusory booms – the dotcom bubble and the housing bubble – and where will the jobs come from to fuel real, sustainable growth.
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This is not a debate I see much of at the national level, but connecting with Americans along the some 6,000 miles of our journey renewed my faith in this country’s greatest capacity: the ability to reinvent itself.

The greatest asset that will help America achieve that is its people. In most of the places we visited the people we met were earnestly looking to the future or were reconnecting with their communities because the housing crisis had affected them or their neighbors.
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After decades of rampant, credit-fueled consumption, people like Denny Robertson in Bella Vista, Arkansas, who has had his salary cut, are reexamining the way they spend and live their lives.

Or people Mike McGreevy, Brandon Barry and Edwin Andino, three young men in Buffalo, New York, who are working for below-poverty wages rehabbing homes because they are tired of hearing people complain about how bad things were in the city and decided to do something about it themselves.
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Or Megan Smith, 21, a student in Providence, Rhode Island, speaking out on behalf of the state’s growing number of homeless people.

All of them good people. We met good people wherever we went, doing the best they can to make a difference where they are.

Then at night while I worked on blogs in my hotel room I would turn the television to one of the cable news channel. The America they talked about was full of Democrats and Republicans, ideology pitted against ideology. Froth and vitriol.
ROUTE-RECOVERY/
I did not see their America on the ground, I just saw good people doing the best they can, together. The contrast between the angry men on television and good people on the ground could not have been more striking. And I found myself wondering just how much of a disservice the media and this country’s two parties do the American people by dividing them up into “us” and “them.”

Because just as this country’s greatest strength is its ability to reinvent itself, it first needs to acknowledge what is broken and what can be done to fix it. Therein lies the real route to recovery.

Political divisions, however, appear to stand in the way of that process on a national level.
ROUTETORECOVERY/
This is not just a foreign observer talking. Time and again throughout this trip I talked to Americans making a difference on a local level who told me they had lost faith in Washington or even state governments because ideology had trumped common sense.

People like Jack Hakim, the Republican mayor of Bullhead City, Arizona, who was angry that the state’s Republican leaders were cutting revenue to towns like his for ideological reasons.

Or Jay Williams, the mayor of Youngstown, who ran against the city’s Democrat political machine because he wanted to affect real change. A registered Democrat, he had to run as an independent with Republican funding to beat local entrenched interests.

Again, both of them good people.
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Most heartening for me on this trip was seeing people stepping up and doing something for their communities, realizing perhaps that while the government should be there to help, it cannot do everything.

People like Pastor Jonathan Watson in Bella Vista, Arkansas, have reached that conclusion. He said he had to overcome his fear of using his church to raise funds in order to launch a book and CD to raise money for healthcare and other services for the elderly in his community.

ROUTE-RECOVERY/Watson said Reuters coming to his church was God’s will. Our arrival confirmed for him that he was doing the right thing. And while I didn’t see it that way, nor take up his offer of spiritual advice at the end of his Sunday service, I like to think we parted as friends.

To Watson, I was part of his conversation with God. To me, his raising money for the elderly was simply just a good thing. For what it's worth, perhaps one of my greatest discoveries on this trip was my faith in good people like Pastor Watson and other Americans, of any religion or none.
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Click here for the Route to Recovery slideshow.

Pictures: From top to bottom

People in a truck leave after shopping at Wal-Mart in Rogers, Arkansas, November 8, 2009. REUTERS/Lucy Nicholson

Paul McDouglad sits on a table at the Urban Ministry soup kitchen in Charlotte, North Carolina November 15, 2009.  Since 1979, the Urban Ministry is the largest and oldest soup kitchen in Charlotte serving more than 300 meals a day.  REUTERS/Carlos Barria

A U.S. flag decal is stuck to the window in a door to the Harrington Hall homeless shelter in Cranston, Rhode Island November 18, 2009. REUTERS/Brian Snyder

A woman walks down the street in the Broadway-Fillmore neighborhood of Buffalo, New York November 19, 2009. Buffalo has 15,000 vacant lots from houses that have been demolished, amounting to 3200 acres of vacant land. REUTERS/Brian Snyder

Steve Patronas stands at the Organized Seafood Association of Alabama office in Bayou La Batre, Alabama November 10, 2009.  REUTERS/Carlos Barria

Pastor Charles Hudson cries as he looks at the damage to the Madison School, where Hudson worked with the anti-violence organization Bondage Busters, in Youngstown, Ohio November 21, 2009. Youngstown has 4,500 vacant structures in a city of about 75,000 people, and about 22,000 vacant parcels of land.     REUTERS/Brian Snyder

Denny Robertson (R) sits with his daughter Heidi, 6, in the living room of their home in Bella Vista, Arkansas, November 7, 2009.  REUTERS/Lucy Nicholson

Senior Pastor Rev. Jonathan Watson (R) blesses parishioners during a Sunday service at the Bella Vista Assembly of God church in Bella Vista, Arkansas, November 8, 2009.  REUTERS/Lucy Nicholson

A pelican flies near a fisherman in Pensacola, Florida November 11, 2009. REUTERS/Carlos Barria

November 26th, 2009

Bad day for banking stocks

Posted by: Aditya Kalra

The banking index dropped 2.6 pct on Thursday, dragged down by losses of over 3 percent in top counters ICICI and SBI.

Stocks in this sector were under pressure throughout trade, which saw all counters in the bankex, except Canara Bank, closing in the red.

HDFC Bank, another major player, ended down 2.4 percent.

Mid-cap counters like Dena Bank and Vijaya Bank too struggled in trade and ended down 6.5 percent and 5.8 percent respectively. Both stocks were among top losers in the mid-cap index.

The banking index has gained 7.7 percent in November, a tad higher than the benchmark Sensex’s return of 6 percent.

Would you take advantage of the fall and invest in this sector?

November 26th, 2009

Indian report raps politicians over Ayodhya mosque destruction

Posted by: Bappa Majumdar

A government-backed inquiry has accused several of India’s top opposition politicians of having a role in the destruction of an ancient mosque in 1992 that triggered some of the country’s worst religious riots.

The report has sparked political protests from opposition Bharatiya Janata Party (BJP), which finds itself in even more trouble as it struggles to emerge from internal feuding after an election defeat in May.

Hindu mobs demolished the 16-century Babri Mosque in the north Indian town of Ayodhya, claiming it stood on the birthplace of their god-king Rama. Riots between Hindus and Muslims left hundreds dead across India.

The report, 17 years in the making, says some of India’s best known BJP politicians — including former Prime Minister Aal Behari Vajpayee and current opposition leader Lal Krishna Advani — did little to stop the destruction despite knowing of plans to demolish it.

Here is our news story on the report and a Q&A explaining the background.

November 26th, 2009

India’s 26/11 - religion no bar

Posted by: Rina Chandran

A year ago, after the three-day siege of Mumbai ended and people took to the streets with candles and banners, a group of young Muslim men, carrying a hand-written poster, walked quietly with the surging crowds.

Seeing them, people began to clap spontaneously, applauding their assertion that Islam was a religion of peace, and not terrorism.

Since then, people in Mumbai, which has witnessed some of the worst communal riots in the country in the past, have come together in their grief, crossing barriers erected by politicians in the name of religion.

Some have accused the media of not highlighting enough, the fact that the militants asked their hostages what religion and then killed non-Muslims.

Others have speculated that the few thousands of Jews left in India would leave the country because six Jews were killed in the attack on Chabad House.

But in Mumbai today, just days after the explosive report on the Babri Masjid demolition was made public, there is a sense of community and togetherness. A big difference from 1992, when riots between Hindus and Muslims that followed the demolition killed hundreds.

And so today, multi-faith prayer services are being held everywhere in the city and there are countless stories of inter-faith friendships that blossomed in the days after the attacks.

And so the nine bodies of Islamist militants killed last November still lie in a hospital morgue because Muslim clerics in the city have refused to bury them.

And so Muslim bakers in Byculla in Mumbai still bake the traditional bread for the Jewish Sabbath.
And so Muslims celebrating Eid on Nov. 28 will gather in the compound of the Jewish synagogue in Byculla for their prayers.

And so at the Chabad House memorial service, Muslim neighbours will be present.
Because when lives have been taken, religion should not matter.

November 26th, 2009

Gold rally could start to tire

Posted by: Jane Foley

JaneFoley.JPGSpot gold prices are up over 40 percent year on year.  Yet, according to the World Gold Council, demand for gold in the third quarter of 2009, dropped by 34 percent year on year.  Of course, demand in the third quarter of 2008 was exceptionally high due to the financial crisis. As well, relative to the third quarter average of the five years to 2007, demand for gold in Q3 2009 was down 4 percent.

When confronted with the ferocity of the rally in gold, the fact that the third quarter demand for gold was below the seasonal average is surprising. The dynamic between price and demand suggests some fall in supply perhaps led by increased hoarding.

According to the council mining supply is fairly inelastic.

Supply of recycled gold generally helps stabilise the price, in recent years this has been 28 percent of annual supply.   Between 2003 and 2008 central bank sales represented the third biggest source of supply.

It remains unclear what the recent gold purchases from the Central Bank of India means for the demand/supply dynamic of gold going forward.

What is clear, is that the gold rally has been exacerbated by dollar weakness, but this only offers a partial explanation.  The dollar index is at 15-month lows.  In August 2008, gold traded at an average rate of $836.84.  Other factors that have chased gold prices higher include the lack of return on cash and fear of inflation.   The former will almost certainly support gold in the coming months, but the inflation argument has no legs.

Following a year packed with fiscal spending and the introduction of Quantitative Easing, Fed chief Bernanke recently said “inflation seems likely to remain subdued for some time”.  If high unemployment and rising savings rates are insufficient evidence of subdued price pressures, lessened availability of credit at a consumer level should drive home the point.

Tightening the availability of credit on Main Street has been an inevitable and necessary consequence of the subprime crisis. Not only should this ensure that consumer activity going forward stays relatively subdued but is also implies that firms will have less pricing power.

Rather the causing domestic inflation, cheap money provided by the Fed and other central banks can be linked with speculator inflows into high yielding markets.  Some asset prices in Hong Kong, China and Singapore are arguably seeing the beginnings of bubbles and this talk alone is supporting gold.

The Fed could hinder this by hiking rates so the dollar was no longer an attractive funding currency but it is unlikely to do so when its domestic economy is weak and expectations for domestic inflation are low.  Like the Bank of Japan in the 1990s, it is possible that the Fed’s ability to create inflation domestically may be lessened in the post crisis era.

While it is difficult to find signs of inflation in the US, Eurozone or UK, near zero interest rates are clearly providing a significant support for gold.  Speculation in general is being fuelled by cheap USDs but in addition, conservative and retail investors are being forced to look outside cash deposits for positive return.  Also, retail investors cannot be blamed for enjoying the intrinsic quality of gold following last year’s banking crisis.

Assuming the Fed starts to hike rates in the second half of 2010 the dollar could see a cyclical recovery on a 6 month view.  Anticipation of higher Fed rates and a stronger dollar should reverse some of this year’s flows into gold.  While this suggests that the gold rally may yet run for another 6 months , the third quarter demand data for gold implies the rally may tire as soon as the first quarter.

November 26th, 2009

India’s 26/11 - religion no bar

Posted by: Rina Chandran

November 26th, 2009

Experts say Batter Blaster needs to adjust marketing strategy

Posted by: Jon Cook

Sean O'Connor conceived of his pancake-in-a-can company - Batter Blaster - nearly a decade ago, but the process of getting the science and the taste to come together took years (See original story here).

To counter the negative perception of many aerosol-food based products, like whipped cream or squeeze cheese, O'Connor decided to make his batter organic and sought the U.S. Department of Agriculture's official approval. This he believed would make it more palatable for his target audience of single mothers.

The move paid off. Batter Blaster is now in 13,000 stores across the country, from Costco to Whole Foods, and will appear in Wal-Mart stores nationwide in the New Year. The product has a 90-day shelf life and retails for $4.99.

THE PITCH

For such an edgy product, going the traditional TV route might seem odd, but O'Connor said they have had great success in the past with short TV hits and wants to do a bigger retro-style campaign, like the Eggo waffle ones that enjoyed so much success in the 1970's.

"Our product kind of brings up that retro/futuristic Jetsons thing," said O'Connor, whose website loads with a nostalgic jingle and the lyric: "Make a better breakfast faster, Batter Blaster."

O'Connor said his revenues have been around $8 million for each of the last two years. If he can make more consumers aware of his product's core strengths of convenience and taste, then he could potentially increase demand fourfold, he said.

TAKING IT TO THE EXPERTS

Kim Gordon, a marketing columnist for Entrepreneur magazine and small business author,  thinks that before O'Connor does any kind of widespread TV campaign, he should first reconsider the name Batter Blaster, as she felt it is too "gimicky" and would not ultimately appeal to their target audience of mothers.

"When you first hear the name of the product and you first see the images on the can, it doesn't jive with what you hope the product will deliver, particularly for this target audience," said Gordon. "People want brands and products they can trust - because money is limited - and what they are doing is they're throwing up a barrier to sales by asking people to get over the mistrust set up by the gimicky name."

Gordon said it's likely too late for O'Connor to change the name completely, but suggested scaling it back on the cans so it's not so front and center and to also change the current slogan "Breakfast is a blast" to something that plays more to the product's core strengths of it being a fast and healthy alternative to traditional pancake mixes.

"As you introduce a new product it should be safe and comfortable," insisted Gordon, who referred to whip cream product Reddi-wip's slogan 'Nothing's more real than Reddi-wip' as a good example. "You get the consumer past the fear of the unknown by making the product comfortable, but also fresh and young to appeal to young mothers, not too kitschy or funny."

Jonathan Salem Baskin, a brand marketing expert, blogger and author of "Bright Lights & Dim Bulbs",  agreed with Gordon and felt Batter Blaster appears to be somewhat conflicted in terms of its advertising message, as its organic ingredients are at odds with the campy nature of its marketing strategy.

"The Batter Blaster aerosol-like can, and 'cartoony' branding imagery, almost contradict the wholesome nature of the product," said Baskin, adding that O'Connor should stress the healthier aspect of his product more. "I'd shelve the presumption that people want pancake batter made easy - a la salad in a bag - and instead identify a more compelling benefit. 'Fresh made fast' would address the parental desire to serve better food without the hassle."

Baskin also warned against expanding distribution overseas, before locking down the U.S. market. "There's no math that supports a small company developing distribution so far away from home so early in its history," said Baskin, who suggested O'Connor focus his energies less on getting Batter Blaster into more stores and more on trying to simply increase the number of point-of-sale purchases in existing retail outlets.

"This is a cool product and I love the obvious intelligence and passion evidenced by the leaders of the business," he said, "but the talk about global distribution and selling to every customer who has a mouth makes me worry that their eyes are a bit larger than the reality of their plans."

Therese Tetzel, president of the Dallas, TX-based sales and marketing agency BusinessMODERN, felt Batter Blaster is a great product concept and one that reminded her of Ben & Jerry's with the same attributes of being easy, fast and with all-natural ingredients.

Tetzel said where Ben Jerry's excelled was in the entire consumer experience of their ice cream - the taste, the texture, the enjoyment, the satisfaction, the packaging and the wholesome ingredients - and suggested O'Connor needs to do more in regards to conveying that to shoppers.

"Its not about how easy it is to use the can, it's what is in the can and how good it is to eat," said Tetzel, who used to do marketing for Quaker State. "I would take a step back and do some quick product testing to make sure I understood what consumers thought of the product, what they liked, what they didn't, why they bought, and why they didn't."

Tetzel said that in addition to Whole Foods and Wal-Mart, O'Connor should market his batter directly to military grocery stores, dormitories, hotels, hospitals and nursing homes or anywhere that relies on fast and healthy eating.

Do you agree with our experts? What should O'Connor do to promote awareness and boost sales for Batter Blaster? Post your comments below.

November 26th, 2009

A black swan in the desert

Posted by: Jeremy Gaunt

Just when investors were settling down to lock in a few of the year's profits and put their feet up for the end of the year holidays, a black swan has come waddling out of the desert to put everything on edge.

The unwelcome cygnus atratus came in the form of Gulf emirate Dubai telling creditors of Dubai World and property group Nakheel that debt repayments would be delayed.  Fears of contagion spread widely, hitting world stocks, lifting the dollar out of its basement and driving demand for European debt so much that a roughly 6-month trading range for futures was breached.

It all may settle down soon. Dubai says the problem does not apply to its big international ports group.  Meanwhile, the emirate is a pretty leveraged place, but fellow emirates and neighbouring countries such as Abu Dhabi, Qatar and Saudi Arabia are pretty flush with cash. They could even step in to help as a matter of solidarity.

At least for now, though,  it is showing just how interlinked everything is.  Ok, of course, banks get hit when people worry about expsosure. But who would have thought that a European car company  would get clobbered by a debt problem in the Gulf?

The issue is those sovereign wealth funds that have been recycling their country surpluses into investments elsewhere. Qatar owns 10 percent of Porsche, Abu Dhabi and Kuwait own 17 percent of Daimler between them. So it is not just investors worrying about their money in the region, it is investors also worrying about where the region's money is.

Is country risk taking on a new meaning?

November 26th, 2009

‘Bot seriously, folks

Posted by: Kim Kyung-Hoon

Fear not the fiery robot apocalypse of the Terminator movies. Fear the cute machines exhibited at the International Robot Exhibition 2009 because they will destroy mankind by being better spouses.

Flash forward 20 years: People start marrying robots, the population plummets. There’s no need for Skynet’s gun-toting Terminators, because there’s no one to shoot at and Craig’s List personals read like an automotive parts catalogue: “Likes: hydraulic muscles and the smell of WD40. Dislikes: Clingy A-I personalities and 'bots that need to recharge every 10 minutes".

Reason to fear robots #1Okonomiyaki: Robots cook better than you do

Robot-maker Toyoriki’s “Okonomiyaki robot” has 15 motorised joints to precisely mix the batter for savory Japanese pancakes, then pour it onto a hot griddle and cheerfully entertain while you wait to be served by reading the latest news out loud and singing songs.

Reason to fear robots #2Seal: Robots are better listeners

According to researchers, Paro, a seal-like robot, was developed to provide the relaxation and speedy patient recovery seen in animal-assisted therapy in places such as hospitals and nursing homes where animals aren’t allowed. The therapeutic robot has soft white artificial fur and a behavior generation system that mimics a real animal.

JAPAN Reason to fear robots #3: Robots are never too lazy to recycle

Eager’s “D+ropop” eco-friendly robot’s soft outer case is made of corrugated cardboard while it’s inner structure is metal. The maker says the humanoid will become popular as a new form of advertising media -- just don’t leave it in the rain.

Photo credits: REUTERS/Kim Kyung-Hoon

November 26th, 2009

IFFI 2009: Aijaz Khan on ‘The White Elephant’

Posted by: Tony Tharakan

Aijaz Khan's debut feature film, about Shabri the drunkard and a 'holy' elephant which chooses him as its keeper, is set in a village in Kerala.

The Hindi film, starring Tannishtha Chatterjee, Prroshanth Narayannan and Neena Gupta, is being screened at the 40th International Film Festival of India in Goa.

Khan spoke to Reuters about 'The White Elephant', where he got the idea for the film and how the mahout controlling the elephant was the "real hero".