news
Kraft Foods Net Revenues Grow by 10% to $54 billion Ahead of Planned Separation
<!–
–>
Cod liver oil is known to be rich in Vitamin A (retinol and vitamin D3 (cholecalciferol), which are attributed to the adjuvant setting properties of calcium in the bones, it also benefits the cardiovascular system, circulatory, and assisting in osteoarthritis inflammatory and painful, adjuvant therapies to fight osteoporosis.
Peel grows 11.8pc to 1.3M strong
Staff Report
Peel’s population grew 11.8 per cent to 1,296,814 by 2011, from 1,159,455 in 2006.
The latest census data from Statistics Canada show Brampton grew 20.8 per cent, Mississauga 6.7 per cent and Caledon 4.2 per cent.
“The Region of Peel has grown rapidly since 2006 and continues to grow at a fast pace,” said Regional Chair Emil Kolb. “We continue to attract more residents within the Greater Toronto Area each year, making us a culturally rich, dynamic and changing community.”
At 21.4 per cent, Peel has the second largest share of the Greater Toronto Area’s population (to Toronto’s 43.2 per cent share), and is projected to continue growing.
The census also showed Mississauga accounted for 55 per cent of Peel’s population, while Brampton and Caledon accounted for 40.4 per cent and 4.6 per cent respectively.
There were 402,939 occupied private dwellings in Peel, up 12.2 per cent from 2006. Mississauga had 234,582, Brampton 149,271, and Caledon 19,086.
With an 18.6 per cent share, Peel comes second after Toronto (48.4) with regard to occupied private dwelling units in the GTA.
SHAW: What if our rich uncle cut us off?
Is it realistic to think our “rich uncle” will help Rapid City
become wealthier?
Our community ranks lower than Sioux Falls, Bismarck, N.D., and
Billings, Mont., in per capita income. That statistic won’t change
much if we continue to expect Uncle Sam to send us money and not at
the same time encourage and help the private sector of our economy
grow.
Sioux Falls benefits from private financial institutions like
Citicorp and Premier Bank with credit card operations in the city
that employ thousands of people. That has raised their economy and
made Sioux Falls a mini-Minneapolis culturally and
professionally.
Bismarck is the state capital of North Dakota and features diverse
private manufacturing and service industry sectors. Basin Electric
and MDU Resources are both headquartered there, and the oil boom in
North Dakota is boosting the economy.
Billings is a retail and banking center for the upper plains and
because Montana has no sales tax, draws shoppers from North Dakota,
Wyoming and South Dakota. The economy in Billings is also driven by
the privately-owned energy industry because the city is close to
the largest coal reserves in the United States as well as huge oil
and natural gas reserves.
Where does Rapid City derive most of its wealth? Federal government
spending, along with tourism and natural resource exploitation,
have been our primary economic drivers for decades.
Rapid City is dependent on a large military presence, which most
observers think is likely to shrink rather than grow in coming
years.
The visitor industry is clean and does not impact public
infrastructure such as schools but is notoriously seasonal and
low-paying for employees.
And the timber, mining and agriculture aspects of our economy are
all much smaller than a generation ago and not apt to grow
significantly in terms of employment.
Several major universities in the area depend on state and federal
subsidies and government-guaranteed student loans for much of their
income, and the Regional Health Care juggernaut continues to
expand, thanks in part to massive growth in federal, state and
insurance company dollars.
On the private sector side, our retail draw area is huge, comprised
of parts of five states — Nebraska, Wyoming, Montana, North Dakota
and, of course, South Dakota — and encompassing 250,000
people.
Rapid City’s emphasis on attracting large retail operations such as
Cabella’s, the Rushmore Crossing shopping center and a second
Wal-Mart is due in large measure because these entities produce
hefty sales tax revenues, which helps hold down the city’s need for
higher property taxes, and provide employment for hundreds of
people.
A few years ago, an outline was developed for a proposed high-tech
corridor in the Black Hills that could eventually enliven our
economy with numerous new technology companies. The initiative was
fueled by the prospect of the former Homestake gold mine becoming a
National Science Underground Lab, but with that status now somewhat
uncertain because of constraints on federal spending, the expansive
document usually sits on the proverbial shelf gathering dust.
Economists say Rapid City needs more primary jobs generated by
private businesses in order to grow our economy, and that too much
reliance on government spending is unpredictable and unwise in the
long term.
Their advice makes sense. After all, as they point out, even a
“rich uncle” can run out of cash.
Jim Shaw is a former Rapid City mayor. He can be reached at
jimshawrc@hotmail.com.
LIFE’S LIKE THAT By Andrea Rich: They grow up way too fast
For all the young moms out there struggling to get through the grocery store/pharmacy/shoe store realizing that in a few seconds, the baby will begin to cry and the toddler, minus a nap, will have a meltdown when an older woman you’ve never seen says “Cherish these moments, they go so fast” I urge you: Don’t get mad.
Sure you can roll your eyes, I did, even mutter under your breath.
File the advice away somewhere in your mind, out of the way, until later.
Why? Because it’s true.
I am not proud to admit that given the severity of the circumstances (a baby crying in the store or a toddler giving you the equivalent of 35 seconds in a gator tank for all the wrestling you did with him in church) I didn’t take a moment to realize what they were saying. I rolled my eyes when they turned away, I muttered under my breath that some nights of a sleepless baby lasted years, and I looked with envy at other people’s self-sufficient children and wished for that.
While I was busy taking care of them and keeping them out of trouble as best I could, that time flew by.
Because they are not completely out of the nest yet, I’m trying to grab on to all the time I wasn’t paying attention. I’m trying to cling.
I can’t begin to tell you how embarrassed they are.
If a young couple with a new baby slides into the pew beside us in church, I watch that little baby with fascination, and envy, until one of my girls says “Mom, stop. It’s not yours.”
“I know,” I whisper sadly.
Then
I put my arm around her, or try to link my arm through hers.
“Mom,” she says, trying to scoot away, wishing I’d go back to looking at that baby.
Some mornings before school, they are trying to race out the door and I’m hugging them goodbye.
“OK Mom, you have to step away now,” my middle child tells me.
I don’t move.
“That’s good now. Back up a little. I’ll miss the bus,” she says.
The sound of a school bus making the turn onto our street finally convinces me to let up.
I hope – really they hope – this is just a phase and I’ll not spend the rest of their school years clinging to them, afraid to let them go.
I remember wishing for their independence, now no one needs me to brush their hair, or fix their breakfast.
On a recent and rare Saturday morning when I didn’t have to be somewhere early, I came downstairs to fix a cup of coffee and heard the television on.
I peeked around the corner into the living room, and saw my little boy – my baby – watching TV, kicked back on the couch.
“Hey Mom, I let you sleep,” he said, giving me a smile that seemed far older than he should be.
I sat down with him and nearly cried.
“Why are you sad?” he asked, patting my back.
“Because you are practically grown up and moved away! You’re so big now! You didn’t even wake me up!” I said, trying to maintain some composure.
He sighed, and took my hand.
“That’s a little dramatic, don’t you think? First grade isn’t even over yet,” he said.
He has a point.
- – -
Andrea Rich lives in Chambersburg with her wonderful husband, three beautiful children, one dog and one cat. Follow Life’s Like That on Facebook or follow Andrea on Twitter: @arichPO.
For Oregon farmers, oil-rich canola is either promise or peril
RICKREALL — Farmers Kathy Freeborn Hadley and her father, Dean Freeborn, park their rumbling Dodge Ram pickups at the edge of a 30-acre turnip field. They farm 900 acres and the turnips are a broadleaf rotational crop, intended to interrupt disease and pest cycles that accumulate from year after year of grass seed or wheat.
Turnips are fine for that task. But if Hadley, Freeborn and a couple dozen other growers had their way, scattered Willamette Valley fields would be growing canola, which produces tiny dark seeds loaded with oil for food or bio-diesel.
They can’t. Nearly 10 years of tense discussion have left canola the only crop restricted by the Oregon Department of Agriculture. Despite rising interest in alternative fuels, the presence of an oil pressing plant in Rickreall eager for more canola and news that a food-grade oil plant will be built in Central Washington, canola remains stymied by farmers who grow fresh market vegetables or raise vegetables for seeds.
Those growers believe canola will spread out of control and displace vegetables as it did in northern France. They worry canola will cross-pollinate and contaminate crops, or spread pests and diseases. So far, the agriculture department is on their side, and has drawn a 48-by 120-mile rectangle in the valley – 3.68 million acres from Portland to south of Springfield — in which canola cannot be grown without a permit. Washington and Idaho have canola restriction zones, but Oregon’s is by far the largest. Beyond some test plots in 2007-09, no grow permits have been issued.
Canola advocates are pushing again this winter. The agriculture department has asked both sides to submit proposals by March 1.
View full sizeFarmer Kathy Freeborn Hadley believes canola can be grown without harming vegetable seed crops.Hadley and Freeborn say they have no interest in harming other farmers, and they think canola can be safely grown in the valley.
They describe canola as an ideal addition to their rotation of crops and an alternative to grass seed, which is still hurting from the recession. It breaks disease cycles, doesn’t require irrigation and can be planted and harvested with the same equipment used for grasses and grains. Meal produced in the crushing process is prized as chicken and cattle feed.
And it’s profitable, helped by a five cent per pound state tax credit to encourage biofuel crop production.
Hadley and her father grew a 17-acre test plot one year and 55 acres another. “I sat down and ran the numbers, and we netted more on it than any other crop we raise,” she said.
Father and daughter are not agricultural carpetbaggers chasing alternative fuel subsidies. Freeborn, 56, was a senior in high school when his father died and it fell to him to run the family farm. Hadley, 30, began driving her father’s harvest equipment at 9 and was on her own in the fields at age 12. She rowed crew at Oregon State University, where she studied agriculture, earned twin bachelor degrees and researched bio-diesel production for her master’s.
Her husband, Troy Hadley, farms with his father in the Silverton hills. Troy and Kathy’s son, 16-month-old Grant, has ridden with mom in the combine for extended periods.
Kathy Hadley believes limited production is possible, with perhaps 90 to 100 acres of their land planted in canola in any given year.
“I don’t want to run anybody out of the valley or hurt any other industry, but I believe we can work out some kind of compromise,” she said.
Hadley and others have teamed with Tomas Endicott, vice president of the Rickreall oil plant, to press the issue once more with the Department of Agriculture. The new Willamette Valley Oilseed Producers Association, with 70 members, calls for co-existence. They believe the current system of three miles separation between seed crop fields can be modified to allow canola, and suggest an impartial agency such as OSU’s seed certification program should be in charge.
View full sizeCrushed canola seeds provide oil for cooking or bio-diesel, and meal for livestock feed.The Willamette Valley Specialty Seed Association and outspoken vegetable growers are extremely wary.
“They’re not at risk — we are,” said Mike Iverson, who grows fresh market cilantro, spinach, radishes, cabbages and other vegetables in Aurora. It may be safe to grow some canola at the edges of the restricted zone, he said, “But to turn it loose in middle of the valley is just stupid.”
The ag department is searching for a compromise.
“We’re kind of a referee here,” said Dan Hilburn, administrator of the department’s Plant Division.
The issue illustrates a quirk — usually a strength — of Oregon agriculture. Rather than massive amounts of one or two commodities such as corn or wheat, the state produces about 200 diverse crops — from blueberries and hay to peppermint oil, Christmas trees and potatoes. Farmers such as Iverson produce about $32 million worth of fresh market vegetables annually.
A significant percentage of vegetables raised here aren’t grown for food or even livestock feed, but rather for seeds that other farmers plant worldwide. Seed crops include turnips, sugar beets, cabbage, spinach, radish, squash and pumpkins — more than two dozen in all.
Oregon’s vegetable and flower seed production is worth $32 million to $50 million annually. Seed companies tightly control quality, issue contracts to growers and supply starter seed to “multiply” in the field.
“What is at risk here is a worldwide reputation for specialty seed,” says Greg Loberg, manager of West Coast Beet Seed Co. and spokesman for the seed association.
It’s a lucrative business. Iverson, the vegetable grower, said a 40-pound sack of hybrid radish seed cost him $1,680.
Tomas Endicott says there is a good market for canola oil.But pressure is increasing. Endicott, of the Willamette Biomass Producers plant, says he could sell every additional drop of canola oil he produces. Another company, Pacific Coast Canola, plans a January 2013 opening of a food oil plant in Warden, Wash., capable of processing 400,000 tons of canola seed annually. Vice President Stephen Starr hopes growers will quadruple canola acreage in Oregon, Washington, Idaho and Montana.
Hilburn, of the agriculture department, called the problem a Gordian knot. How can the state help one segment of farmers, he asked, without harming another?
He said “one of the most interesting days in my career” was a 2009 telephone conference with experts who’d wrestled with the vegetable-canola conflict in France, England, Denmark and Japan. Each clearly believed the Willamette Valley’s soil, water, climate and ability to isolate fields made it one of the best places in the world to grow seeds. But canola?
“They all said, in so many words: I don’t know what the answer is, but don’t blow it.”
–Eric Mortenson
KFH-Research report about Islamic wealth management industry
- Text size
Fortunes of the rich will reach USD 162 trillion in 2015
Astonishing growth in Islamic fortunes expected in light of increasing number of rich Muslims USD 1.3 billion volume of Islamic assets by end of 2011
KFH-Research prepared a report about Islamic wealth management industry around the world. It stated that this industry has great growth potentials during the coming years, in light of the growing number of rich Muslims, constant growth of Islamic assets, and the increasing demand for Shariah compliant services and products in Islamic and non-Islamic countries. It revealed that the volume of Islamic assets reached USD 1.3 billion by the end of last year.
The following is the report:
Islamic Wealth Management Industry
Islamic assets have grown at an average rate of 15%-20% per annum over the past decade to reach approximately USD1.3tln in 2011. The main driver behind the development and growth of the Islamic finance industry is the growing demand and preference for Shariah-compliant financial products, backed by rising wealth and excess liquidity arising from the high oil prices over the years. Since the 1970s, when GCC oil companies were nationalised and oil prices surged, the region’s GDP as well as individual fortunes have grown significantly. Indeed, the Islamic wealth management industry remains one of the fastest growing sectors in the Middle East and sparked high interest outside the region.
In recent years, a genuine interest in Shariah-compliant products and services among the country’s Muslim and non-Muslim communities alike has caused market forces to take over and steer the growth. We see tremendous growth potential in the Islamic wealth management industry, driven mainly by the increasing population of high Islamic high net worth individuals (HNWIs) as well as improvement in investors’ confidence on the back of commendable economic growth in emerging countries.
According to market estimates, global wealth increased by 8% y-o-y to USD121.8tln in 2010, underpinned mainly by strong growth rates in emerging economies, high commodity prices, recovery in the real estate markets, and high oil prices. Although the growth pace in wealth has slowed post global financial crisis, compared to the average growth pace of 11% achieved between 2002 and 2007, the outlook continues to remain positive, with strong wealth growth drivers in the emerging markets of Asia, the Middle East and Latin America.
Global wealth is projected to grow by approximately 6% annually between 2011 and 2015 to reach USD161.9tln, characterised by the following factors:
-
Positive performance of capital markets, strong GDP growth especially in emerging markets and increased savings worldwide post crisis.
-
North America is expected to remain the largest wealth market, with total wealth growing at an average rate of 6.9% annually to reach USD48.8tln in 2015, representing 30.1% of global wealth.
-
Europe is expected to be the second largest wealth market, with total wealth growing at an average rate of 5.7% annually to reach USD45.6tln in 2015, accounting for 28.2% of global wealth.
-
Asia’s total wealth (excluding Japan) is projected to grow at the fastest pace, averaging at 18% per annum to reach USD37.3tln in 2015. As such, Asia’s total wealth will account for approximately 23% of global wealth in 2015 (2010: 17.8%).
-
TotalTotal wealth of emerging markets of Asia (excluding Japan), MENA and Latin America combined is projected to reach USD49.4tln in 2015, representing an average growth rate of 16.6% per annum. TotalTotal wealth from these regions will account for approximately 30.5% of global wealth in 2015 (2010: 24.4%), outstripping North America’s 30.1% and Europe’s 28.2%.
Islamic banks, takaful companies, Islamic investment banks as well as Islamic private equity companies act as an intermediary to channel surplus money into the financial market system. The Banker Top 500 Islamic Institutions reported that the GCC’s full-fledged Islamic banks contributed 42.1% of total global Islamic banking assets in 2011, followed by Iran (35.7%), and Malaysia (12.3%). The Islamic banking industry is not only confined to Muslim-majority countries such as the GCC and Malaysia, but also into new territories such as the Far East and Europe, many of which are currently in the midst of implementing appropriate regulatory and legal reforms that would facilitate the provision of Islamic financial products. Customer base comprises both Muslims and non-Muslims while players include domestic as well as international conventional banks.
Over the years, the Islamic financial institutions have started to tap new growth opportunities in other regions and form cross-border linkages. The range of Shariah-compliant products and services has also grown, underpinned by an increased knowledge and awareness of Islamic finance principles. The depth and breadth of Islamic finance products have increased from basic savings account to more sophisticated instruments on the capital market such as sukuk or Islamic bonds and Islamic real estate investment trusts.
Sukuk forms a significant component of the Islamic capital markets, second only to equity. Over the past decade, the sukuk market has grown to reach USD178.2bln outstanding to contribute 14.3% of the total global Islamic finance assets at the end-2011. 2011 witnessed primary market issuances grow by 88.4% y-o-y to USD85.1bln. During the period, the South-East Asia region dominated issuances, accounting for 76.9% while issuances in the GCC region accounted for 22.1% and other jurisdictions the remaining 1%. Prospects for the sukuk industry remain bright, underpinned mainly by sovereign issuers and their support for the market, which issued USD58.9bln or 69.3% of all sukuk during 2011, strong economic growth and development in the emerging markets, the continued spending on infrastructure and the project-based financing requirements in Asia and the Middle East.
The Islamic funds industry has grown sharply over the past decade thanks to the growing number of institutions structuring products as Shariah-compliant alternative investments. The industry took off in 2007 along with many other areas of the asset management world. Unfortunately, it followed suite when asset prices retreated after the global financial crisis and global markets faced a sharp correction. Nevertheless, total Islamic funds’ assets grew to USD40.9bln in 2011, achieving a 7.4% growth during the period. Similarly, the number of funds grew to 715 at the end of 2011, up 3.9% from the 688 funds in 2010.
2012 looks set to be a difficult year for Islamic funds given the continued struggles in the Eurozone, as well as in other developed nations which are facing the prospects of another recession. Shariah-compliant equity, which made up 56.3% of Islamic funds’ asset allocation in 2011, will be crucial to fund performance and will be looking to rebound after ending 2011 negatively.
Outlook
There is likely to be a bigger migration to Islamic financial services in certain markets due to the loss of faith in the conventional system arising from the global economic and financial crisis. As market conditions continued to improve, expect investors to increasingly look for Shariah-compliant investment opportunities which are more transparent and ethically structured.
Attention has been increasingly drawn to the Islamic microfinance segment as a means to eradicate poverty in countries with large Muslim populations. In this regard, Islamic microfinance could serve as a possible investment to investors who are looking for an asset class that offers both positive social implication as well as reasonable returns to the investors. Islamic microfinance is indeed unique, as it is a mixture of economic, social and religious principles:
-
Economic. The elimination of interest rate or riba and other unlawful transactions help to avert harmful consequences to the society and economy.
-
Social. The profit and loss sharing contract promotes participation, equality, trust and brotherhood.
-
Religious. The practice of benevolent finance is an implementation of worship and moral responsibility of human beings.
Moving forward, we see tremendous growth potential in the Islamic wealth management industry, driven mainly by the increasing population HNWI as well as improvement in investors’ confidence on the back of commendable economic growth in emerging countries. The International Monetary Fund (IMF) expects global growth to expand by 3.3% in 2012. Although advanced economies are expected to struggle to grow, growth in emerging and developing Asia is expected to expand albeit at a slower pace, with China’s GDP to grow by 8.2% in 2012 (2011E: 9.2%) and India’s growth is forecast to slow to 7% from 7.4% in 2011.
Meanwhile, the economic outlook remains robust for the GCC supported by high revenue from the hydro-carbon sector and higher public spending. Crude oil is expected to average at USD100 per barrel in 2012 vs. USD98.8 per barrel in 2011. Non-oil GDP growth in the GCC is also expected to remain healthy following additional fiscal spending and implementation of measures to promote economic diversification. Nevertheless, real GDP growth for the GCC is projected to ease from 6% expected in 2011 to 5% in 2012, taking into consideration the downside risks from the likelihood of volatility in oil prices, high inflation induced by massive government spending and slowdown in the global economic activities.
Other factors that will support growth of the Islamic wealth management industry include the following:
-
Strong demand for Shariah-compliant products and investments.
-
Proactive measures taken by governments and jurisdictions worldwide to promote the development of Islamic finance in their respective countries.
-
Government-linked/ top tier companies in the Middle East and emerging Asia (financial, real estate, oil gas and transport sectors) are looking for funds on the back of massive infrastructure and construction projects in the regions.
-
Encouraging demographics. By 2020, the total Muslim population would have increased to an estimated 2.5 billion from 1.5 billion currently. Currently, Asia Pacific region has the highest Muslim population totalling 1 billion or 62.1% of total Muslim population.
In terms of investment preference, in the next few years, HNWIs are expected to increase allocations to riskier assets such as equities and real estate, in line with improved investment sentiments and especially if the global economy shows clear signs of a sustained recovery.
Key risks to the outlook include a slowdown in the world economy and contagion effects arising from the European sovereign debt problems.
About KFH Research Limited
KFH Research Limited is an award winning, independent Islamic research entity and is owned by Kuwait Finance House. Its research advisory includes economics, financial and feasibility analysis on new markets and potential investment ventures in various sectors worldwide. Please visit www.kfhresearch.com for more information.
© Press Release 2012
Insanely Rich Russians Are Taking Over The British Court System
AP
- Italy to tax Vatican for commercial properties
- Iceland’s debt rating gets a bump on strong recovery
- Thailand gold rush has unusually good year
See Also
How Kate Middleton Saved Pantyhose With ‘The Duchess Effect’
Britain Just Opened The World’s Biggest Offshore Wind Farm
Even Mikhail Gorbachev Thinks It’s Over For Putin
The disputes playing out in London courts increasingly feature tough guys with private jets who deploy armies of attorneys to fight over obscene piles of cash. What they lack, however, is British plaintiffs or defendants.
London has become the battleground of choice for big business disputes emerging from Russia and countries that once belonged to the Soviet Union, a group known as the Commonwealth of Independent States, or CIS.
As these countries’ economies grow and globalize, post-Soviet businessmen increasingly shun local judicial systems, which often lack experience and are riddled with corruption.
Instead, they take their disputes to international courtrooms and arbitral tribunals.
Many of the legal narratives from this newfangled world of offshore lawyering read like the scripts for gangster movies.
Read more: Why is Russia prosecuting a dead man?
For instance, self-exiled millionaire Boris Berezovsky reportedly wedged himself through the legs of an special forces-trained bodyguard at the Hermes store on London’s posh Sloane Street, to serve oligarch Roman Abramovich a court writ informing him of a $6 billion lawsuit.
“I’ve got a present for you,” Berezovsky declared as he handed Abramovich the suit, the most expensive to ever be tried in Britain, according to the Daily Mail.
In another case, Kazakhstan-based BTA bank has been litigating with former chairman Mukhtar Ablyazov, for allegedly embezzling nearly $5 billion from the now-nationalized financial institution. The case involves nine lawsuits and more than 50 lawyers, the largest number to ever work on a case in British legal history, experts say.
Ablyazov, who fled to London in 2009, was found guilty Thursday of failing to disclose more than $50 million worth of assets, including posh properties in London and Moscow and 600 shell companies, after being ordered by the court to do so.
Ablyazov, who faces 22 months in jail, did not attend the hearing Thursday, sparking rumors that he fled England. Ablyazov’s brother-in-law, also involved in the case, has already been sentenced to 18 months in prison on similar charges. His location remains unknown.
Read more: Can anyone defeat Putin in the upcoming election?
Separately, Uzbekistan-born Israeli businessman Mikhail Cherney is scheduled to meet in court this April with Russia’s “aluminum king” Oleg Deripaska. The $4 billion suit charges that Deripaska cheated Cherney out of his shares in Rusal, the world’s biggest aluminum producer.
In an odd twist, Cherney will give his testimony by video: he is wanted by Interpol for money laundering and organized crime.
More than half of cases in the British High Court commercial division, where a number of this type of cases are fought, involve clients from Russia and elsewhere in the CIS, according to several expert estimates.
A third of all cases at the London Court of International Arbitration, which gets the majority of business disputes because of its speed and confidentiality, involve a Russian-speaking party.
The International Commercial Court also gets its fair share.
The scuttlebutt among London lawyers says that the Kremlin has encouraged litigants to stop fighting their battles in the UK, concerned about how the sheer volume of high-profile litigation in English courts reflects on Russia.
The Kremlin denied any knowledge of such efforts. “It’s not so great that they are suing each other, but everyone is free to decide where to litigate,” a Kremlin spokesperson said. The Stockholm Arbitration Tribunal has long been a popular venue for CIS cases, but London has now taken the lead.
Many post-Soviet executives have bought residences in London, have become involved in local commerce or moved their families there. And CIS companies are often listed on the London Stock Exchange. The bulk of the CIS cases come from Russia, Ukraine and Kazakhstan, lawyers said.
The big bucks
“The cases are always interesting — great characters, and often dramatic allegations. It’s never boring,” said Rupert D’Cruz, secretary of the Russian-British Law Association, who heads the Littleton Chambers CIS Dispute Resolution. They typically involve “multi-billion dollar assets, privatized under questionable circumstances,” said one corporate investigator, who requested anonymity due of the nature of his work.
Events in the cases are usually dramatic, with clients battling over every point, said Alastair Shaw, a Swan Turton commercial litigation partner who has worked with CIS clients in the past.
Physical threats are common in disputes involving businessmen from the CIS, D’Cruz said, and litigants typically travel with burly, highly trained security men.
In court, the CIS cases are complex, involving oral contracts, networks of close family and friends and webs of offshore businesses. Executives from CIS nations, fearful of routine government raids, are among the top clients when it comes to registering businesses in such places as Cypress or the British Virgin Islands, where they can store assets more securely, legal experts said.
While there are no official estimates, lawyers said the disputes are a multi-billion dollar industry. The average legal fees run several million dollars per case, and the number of cases has been growing. Berezovsky’s legal fees alone are reportedly 100 million British pounds ($153.5 million).
The disputes provide growth for the UK’s recession-stricken economy. One entrepreneur opened a firm last year that supplies Russian-speaking paralegals. Dispute consulting firms are hiring more private investigators to accommodate CIS cases, which often lack transparency.
The High Court commercial division moved into a new state-of-the-art 300 million pound ($460.6 million) building in October. The building houses 31 courts and is adorned with a glass staircase and modern art.
English law is often used in business contracts across the CIS for its reliability, independence and established reputation. With capital flight of over $80 billion and Russia’s overworked courts and arbitration tribunals, the disputes are likely to stay in London for years to come, experts say.
Russian President Dmitry Medvedev’s push to increase credibility of the Russian legal system will take years to accomplish, said Evgeny Raschevsk, director of international arbitration and litigation at Egorov Puginsky Afanasiev Partners, a prominent Moscow-based law firm with offices in London.
In the early part of the last decade there was an influx of cases filed in American courts, mainly in New York. But most were turned away because judges ruled that the United States lacked jurisdiction over them, said Glenn Hendrix, an Atlanta-based partner at Arnall Golden Gregory, a law firm that specializes in business disputes.
American courts demand a tighter connection when it comes to accepting foreign cases than the British courts. Moreover, many more oligarchs and businessmen from the former USSR live in London than in New York.
But the number of CIS disputes is growing in the United States as well, Hendrix said. Arnall Golden Gregory, for example, recently hired a lawyer who, “does nothing but Russia and CIS work,” Hendrix said.
“We see potential,” he said.
This post originally appeared at GlobalPost.
Should the Rich Invest Like Colleges?
By Robert Frank
Bloomberg News
david Swensen
Before 2007, every millionaire and billionaire investor seemed to want “the endowment model.”
The idea was that college endowments were outperforming the overall market and many investors. If colleges were doing so well, why couldn’t the rich?
It was the age of David Swensen, the Yale CIO who helped grow the school’s endowment from $1.3 billion to more than $22 bilion and helped pioneer “The Yale Model,” which very generally called for loading up on alternative investments and paring back on bonds and commodities. Liquidity was bad; illiquidity was good.
So in the late 1990s and 20000s, the rich became Swensenites. Many put more than half of their portfolios into alternatives like private equity and hedge funds and drained down their cash.
In 2008, however, alternatives crashed. Harvard’s endowment dropped a record 30% in the fiscal year 2008-2009. What’s more, investors couldn’t get their cash out of many private-equity investments and hedge funds, since they were illiquid.
The endowment model was labeled “broken.” Rich people swore off the “Yale model,” pared back on alternatives and embraced liquidity.
Could it come back?
According to a new report from the National Association of College and University Business Officers and the Commonfund Institute, college endowments returned a whopping 19.2% in the fiscal year 2010-2011. This marks a jump from 11.9% the previous fiscal year.
It sounds impressive. And on its face, it would support alternative investing. More than half of the assets for college endowments last fiscal year were in alternative investments. Only 16% was in domestic equities, 10% was fixed income, 17% was international equities and four percent was in short-term securities and cash.
The rich, by contrast, hold more than four times as much cash and three times as much fixed income securities, according to Capgemini/Merrill.
But don’t count on the rich going back to the “Yale Model” right away. That 19% number was for July 1, 2010 to June 30, 2011. During the same period, the SP rose more than 30%.
So if colleges had just invested in the SP, they would have done much better.
Of course, it’s unfair to judge an investment strategy on a year or two (or four).
But for now, the wealthy remain so worried about the investing climate and economy, that they’re not likely to give up their liquidity anytime soon.
Do you think the rich should invest like Yale and Harvard?
RGM Group’s ad network keeps growing as premium brands spend more online
The RGM Group figures out how to enable premium brand advertisers to target rich people via online ads. And weak economy or not, the company has benefited as those brands shift more of their budgets for chasing wealthy consumers to online publications.
The Venice, Calif.-based company has been profitable ever since Kamran Razavi started it in 2004 at the age of 25. In an interview, Razavi said the company still has momentum and tripled its revenues last year.
“We’ve got a unique model for premium brands,” Razavi said. “We have ads that hit the right person and do so in the right way. We really stand out in that way. We are more efficient when it comes to deploying advertising.”
In August of last year, the company’s RGM Alliance division, an ad network that places ads from premium and luxury brands, had more than 250 U.S. publications in its network. Those included Yachting, Luxury Travel, Burda Style, Zagat, Men’s Fitness, Woman’s Day, Elle, Boating, and Esquire (disclosure: and VentureBeat). Now RGM reaches 350 publications, including 34 new sites this year.
RGM now reaches 124 million unique visitors per month, compared to 117 million in August. In May 2009, the company had 21 million users per month at 66 publications. RGM is now the 61st-largest ad-focused ad network in the U.S., according to comScore. RGM expects it will enter the top 50 in the next month.
“We are still profitable and we haven’t had to raise money,” Razavi said.
RGM still screens its web site publishers so that it only reaches users that premium advertisers want to target. Razavi says the alliance continues to be transparent to both advertisers and publishers, with no hidden sites or traffic sources.
One of the big growth areas is custom ads created by one of RGM’s own divisions for the advertisers. RGM has created ads for Jaguar, Lexus, and ForeverMark on RGM’s own JustLuxe site, which has millions of unique monthly visitors. RGM is also expanding into mobile ads for the iPad, iPhone, and other platforms.
The company has 35 employees. Razavi said he is proud he didn’t raise a large amount of money, like other digital media companies do, diluting the entrepreneurial spirit. Razavi himself came from Tiffin, Ohio, and moved to Los Angeles with all of his belongings in the back of his pickup at age 22. Now at 32, he’s still a young buck.
“I hope my story will if nothing else inspire another young buck to venture out on their own and build a company themselves,” he said. “My story proves this is possible.”
For custom content, the CPM (cost per mil, a measure of ad revenue per 1,000 people) is something like $100. For standard ads, the CPMs are around $8 to $10 for the RGM Alliance. Lower-quality ad networks generate CPMs of $3 to $5.
Razavi said that premium markets have recovered since the recession of 2008-2009, and that has helped the company grow. But he said advertisers are still shifting a lot more of their ad budgets to online publications, and that has helped RGM grow even faster.
“On a global level, we still have a recession-like economy, but online ads could grow 23 percent in 2012,” Razavi said. “People are predicting that online will move past traditional media this year.”
Rivals include companies such as Glam Media, Travel Ad Network, and Conde Naste Digital.
Image courtesy of atyp_koK, Shutterstock
Alberta seeks support from all of Canada to grow energy industry
TORONTO — Oil-rich Alberta’s success is not only a boon for the western economy, but can help boost all of Canada, and that’s why Canadians need to support the province’s energy expansion plans, says Finance Minister Ron Liepert.
In a speech to a Toronto business group Wednesday, Liepert asked that Ontario and other provinces back the oilsands and help Alberta gain access to new markets with a new national energy strategy.
“We must earn the social licence from Canadians to expand and produce this energy,” he said. “There’s too much at stake not to.”
Liepert’s message is the same one delivered to Bay Street by his boss — Conservative Premier Alison Redford — a few weeks ago. Redford urged a Canada-wide strategy to boost oilsands development and support the planned new pipelines needed to get that crude to American and U.S. refinery markets.
Much of the opposition to planned pipelines to the West Coast and bigger oilsands projects has come from environmentalists and other critics, many from outside Alberta.
Meanwhile, the latest census data showed that Canada’s population — along with economic power — is increasingly heading to Alberta and Saskatchewan as Canadians are lured West by the availability of jobs.
The results released last week show that for the first time, more Canadians now live west of Ontario than east of the province — 30.7 per cent compared to 30.6 per cent. Yukon had the biggest growth spurt at 11.6 per cent between 2006 and 2011, followed by Alberta at 10.8 per cent, nearly double the national average.
But supporting Alberta’s plans, he argued, would benefit all of Canada because one-third of the economic activity created by the oilsands occurs outside of Alberta.
Liepert noted that more than 23 per cent of oilsands-related jobs are outside the province and Ontario’s manufacturing sector will benefit as it supplies everything from steel pipes to construction materials, precision machinery and other products to oilsands companies.
The greatest risk to Alberta’s booming economy by 2020 is regulatory red tape that could prevent its oil from being shipped to new markets, Liepert said.
He argues that allowing new pipeline projects to ship oil to Asia would deliver huge benefits to the entire country.
The holdup of TransCanada Corp.’s controversial Keystone XL pipeline in the U.S. over environmental concerns “shows what can happen when you rely on one customer,” he said.
“Quite frankly we need to start paying closer attention to who else wants our oil,” he said.
China, South Korea and other fast-growing Asian countries are hungry for Canadian oil and liquefied natural gas and want to see pipelines built to the West Coast so tankers can carry the energy across the Pacific.