February 19, 2006

On what’s to be done with a subsidiary of an international bank

Sir, Guillermo Ortiz, February 17 discusses the very delicate question of how to make sure that a subsidiary of an international bank that operates in a developing country can survive if and when their parent bank organization runs into trouble, and he makes a good case for the divestment and listing of some of the subsidiary’s capital on local stock-exchanges so as to enroll the forces of market discipline. My feeling is that Mr Ortiz is way too optimistic thinking he stands a real chance of stopping headquarters from milking their subsidiaries, in far away countries, for all they are worth, if it feels it needs it. That said one could also argue that the home authorities of the international bank should not go totally scot-free were a subsidiary run into trouble, for whatever reason, especially since the subsidiary while helping to diversify the risks for the holding company still concentrates much undiluted risk for its own local depositors.

It is sad indeed, to only be a risk diversification, in someone else’s portfolio.

Sent to FT, on February 19, 2006

February 13, 2006

Mobility carries a hidden cost!

Sir, Andrew Ward when reporting about bottled water for the "on-the-go society", February 13, forgot to mention the fact that in many cases, in the USA at least, those that drink from the tab will have less dental caries than those who are on the “move”, since bottled water has none of that fluorine which is frequently added to tap water. Instead labeling the bottles with information about the water having zero calories, perhaps a note about this could provide more enlightening.

Sent to FT, February 13, 2006

February 08, 2006

Quitting oil this way should be easy

Sent to the Washington Post, February 7, 2006, destiny unknown

Quitting oil as proposed should be easy and, as Mark Twain said, we should be able to do it a thousand times. Analyzing what is on the table for battling the habit of oil reminds one of a new-year pledge to quit smoking based exclusively on the use of low tar cigarettes and patches of nicotine, and zero will. Before politicians dare to express the need for a substantial tax on the consumption of gas, no one should be compelled to believe in their determination. But, what about cars with lower gas consumption? Well as it just reinforces the current no-public-transport-model, this could indeed worsen the withdrawal symptoms when, on doctor’s orders, the country finally has no choice but to quit.