Bribery Case
In 1995, before Halliburton acquired M. W. Kellogg, Albert Stanley began a series of bribes to Nigerian officials through two agents totalling $182 million dollars. The bribes were to gain approval for the construction of a $6 billion dollar liquified natural gas plant. The bribes continued after Halliburton acquired M. W. Kellog in 1998, and Dick Cheney promoted him to run the KBR (Kellogg, Brown, and Root) division before leaving in 2000 to become vice-president. The bribes ended in 2004 when Halliburton fired Albert Stanley. Halliburton spun KBR into its own company in 2007.
Mr. Stanley has pleaded guilty and is cooperating. There is always the chance that other players within Halliburton will become involved. Other projects inside and outside Nigeria are being studied by the SEC.
Economy
Consumer spending is the largest driver of U.S. economic growth. On a quarterly basis, it hasn’t declined since the 1990-91 recesion, but with tight credit and rising unemployment, consumer spending may shrink.
At the beginning of 2008, unemployment was 4.9%. It has increased to 5.7% with the loss of nearly half a million jobs. There was a time when 5.7% was considered below the ‘natural’ unemployment rate, and compared to other countires, 5.7% is quite good. However, we have enjoyed better for many years.
The euro zone economy contracted in the 2nd quarter — the first of two consecutive quarters needed to technically enter a recession.
Republican Convention
T.W. Farnam writes, “Demonstrations this week have been the most violent at a national party convention in recent memory, with protesters smashing windows, slashing tires, throwing bags of urine and excrement and physically confronting Republican delegates in the streets.” One man had explosives he said were intended to bomb tunnels under the convention site.
North Korea
North Korea may be beginning to reassemble its partially-dismantled reactor. North Korea wants to be removed from the U. S. list of state sponsors of terrorism. The U. S. hasn’t done this because North Korea hasn’t agreed to a verification regime.
Large Indonesian Churches
Indonesia is largely Muslim (either traditional or modern). As a percentage, there are fewer Chinese in Indonesia than in neighboring Malaysia, and ethnic Chinese make up the bulk of the Buddhist and Christian groups. During the Asian financial crises of the late 1990s, Chinese were the targets of violent race riots. Even today, mobs reguarly attack churches.
In a change that signals a willingness to reassert freedom of religion, the Indonesian government is now allowing the building of megachurches at a time when organized Islamic terrorism has diminished as a national threat. Weakened by arrests, al Qaeda-linked terrorism hasn’t carried out a major assault in three years, and Indonesia’s economy is booming fueled by commodity exports. Rich ethic-Chinese business people are funding these large church projects.
Attacks on Christians are increasingly common in Asia, but churches are starting to push back. A coalition of churches in Malaysia urged voters ahead of general elections in in March to choose parties that protect freedom of religion.
Georgia
The U. S. writes Georgia a check for $1 billion dollars and expresses support for its president, Mikheil Saakashivili. Russia does not recognize that Mr. Saakashvili’s exists and has set his removal as a prerequisite for everything.
Online Advertising
Google is benefiting from a widening gap in spending between simple search ads and flashier display ads (favored by Yahoo and Microsoft). Increases in on-line advertising as a percentage of total advertising are going to simple search ads.
Xbox
Microsoft has price-reduced Xbox 360 to $199, $299, and $399 depending on the model from $279, $349, and $450, respectively in advance of the holiday shopping season.
