Crowds in Wall Street in New York following news of the stockmarket crash.
Crowds in Wall Street in New York following news of the stockmarket crash.
Crowds in Wall Street in New York following news of the stockmarket crash.
Crowds in Wall Street in New York following news of the stockmarket crash.

His vision of history


  • English
  • Arabic

With nervous nods to George Santayana, policymakers and individual consumers alike have been busy searching history for lessons to aid in recovery from the current financial downturn. It takes a great mind and years of experience to explain such complex and far-reaching events, and Liaquat Ahamed possesses both. The Washington, DC-based author of the recently published Lords of Finance: The Bankers Who Broke the World is a veteran hedge fund manager, sits on the board of the influential Brookings Institution and headed the World Bank's investment division. And in his book, which explores the decisions made by central bankers before and during the crash of 1929, he has reached some useful conclusions about that global financial crisis that may shed light on today's turmoil.

Much intellectual firepower has been aimed at fixing the immediate problems with the global economy, an understandable focus given how much havoc the downturn has played with our jobs and property values. But history does repeat itself, and it still behoves us to listen when thinkers of Ahamed's calibre mine the past for lessons. "I started life as an economist," says Ahamed when asked for a thumbnail biography. The statement, delivered matter-of-factly, conjures a Benjamin Button-esque infant sprung from the womb a fully formed Keynesian, savaging the gold standard as he cries for his milk. Ahamed chuckles, realising the comedy of his oversimplified claim, and clarifies:

"I was born in Kenya, went to graduate school at Harvard and then joined the World Bank as an economist in the late Seventies." While he makes gross elisions in his own history ? he fails to mention his undergraduate work at Cambridge, for example - Ahamed's approach to global financial history in Lords of Finance is much more meticulous. In conversation he maintains wide-ranging opinions about matters from monetary policy to aid to banks in the Gulf states, and seated in the plush comfort of his Manhattan pied-à-terre, overlooking Park Avenue, it's clear that Ahamed knows a thing or two about personal finance, too.

For those despairing over the swooning markets, he makes the case for a silver lining by citing the example of John Maynard Keynes, the paradigm-shattering economist and "hero" of his book. Keynes had amassed a small fortune in the Twenties, but lost most of it in currency trades during the 1929 crash. In 1932 he took what was left, Ahamed explains, and invested it carefully, for the long term, in stocks. "When Keynes died, he was worth about $2 million, or about $24 million in today's terms," Ahamed notes. "Not too bad for a Cambridge don." The lesson? That "great fortunes have been built up by people taking advantage of panics."

Ahamed, who is 56, adds to this a dose of common sense. "Beware of bubbles," he warns. "They always burst. Don't invest in five properties with borrowed money and assume that you'll be able to get out faster than the next person." Like some other observers, Ahamed sees Islamic banking as something of a safe harbour from churning seas of speculation. "In Islamic banking you can't employ leverage to the same extent," since lenders hold equity and "are sharing in and are conscious of the risk." Overleveraged investments were one cause of the current downturn, Ahamed says, and sharia-compliant banking is nearly void of highly leverage arrangements.

Looking again to history, Ahamed questions the future role of Gulf cities in finance. "[In the Twenties and Thirties], there were some financial centres that completely disappeared as such," he says. "Paris was the second financial capital of the world before 1914, and it never reclaimed that status. Amsterdam, because the Dutch were neutral during the first world war, became a financial centre sort of like Dubai has been recently." But Amsterdam soon went the way of Paris.

In the future, Ahamed says, the action will unfold farther east, in China. "The question is, can the Shanghai-Hong Kong complex represent a sort of new financial centre?" he wonders. "Is Shanghai now to New York what New York was to London [after the first world war]? Of course, the US was the largest economic power even before it was a financial power. China is still not yet the largest economic power, so I personally don't think we're anywhere near that transition."

As for the challenges currently faced by the emirates, Ahamed says protection of the banking system should be the highest priority, taking precedence over ongoing stimulus efforts. Abu Dhabi recently spent Dh16bn recapitalising its local banks, and the UAE's central bank has made roughly Dh120bn available to local financial institutions to reinvigorate lending. Whereas the US needs stimulus because consumer spending has tanked and "monetary policy has lost all traction," Ahamed doesn't believe that a decrease in spending is a potentially fatal problem in the Gulf. "The danger in the Middle East is that you have asset prices collapsing," he says. "You're going to have a series of bankruptcies. And that's fine ? I don't think they should be stopped. The big risk is that it poisons the banking system. That's the lesson we've learnt here ? you have to protect your banks. You're going to need government intervention."

Ahamed also weighs in on the recent $800 billion US stimulus package: "I would have preferred the stimulus to have been larger ... although to a degree it was probably neither politically nor institutionally feasible to pass anything more. I would suspect it's not the last stimulus package we will have because I don't think in and of itself it will act as enough of a locomotive to turn the economy around."

Ahamed has observed the flight of expatriate workers from the UAE with interest, noting that mobile labour is a relatively new phenomenon in the history of crises. Whether they're fleeing debt or simply leaving due to absence of opportunity, foreign workers can act as vectors for financial weakness. "The world was global in the Twenties, in the sense that capital was mobile, and goods were mobile." Workers, however, were not. "Foreign workers are going to be one of the biggest transmission mechanisms for the current crisis, especially on the lower end of the pay scale. I would bet that remittances to South Asia from the Gulf are being hit badly."

In certain respects, Ahamed views the present crisis as more pervasive than that which precipitated the Depression. "That crisis was primarily in the stock market," he says. "But, only about 10 per cent of the population was involved in the stock market at the time." By contrast, in the "ownership society" of the modern day, the real estate bubble touched everyone. "You couldn't go to a dinner party recently and not hear people talking about how much money they were making flipping condos. It was pervasive."

As the private sector frets over consumer debt and a stalled real estate market, governments should be standing arm-in-arm, Ahamed asserts. He seems to regard the so-called "Gulf internationalism" practised by the Emirates as the appropriate stance, even if it has opened to country up to some turbulence in recent months. "You need countries to act as leaders. Each country acting on its own is likely to produce 'beggar thy neighbour' policies. Important countries need to say that they will act not only in their own narrow self-interest but in a sort of wider global interest," he adds. As is his wont, he refers again to the history books: "Protectionism in the US [in the Twenties] was an example. It didn't cause the Great Depression, but it was a way for the US to export its unemployment problem abroad. Then its trading partners tried to kick the ball back with protectionist policies of their own and so you had a system of passing the parcel around without solving the problem."

As most epochal events tend to do, the current economic meltdown has produced an outpouring of books attempting to explain the still unfolding crisis. Some of the better ones include The Subprime Solution by economist Robert Shiller, portfolio manager George Cooper's The Origin of Financial Crises, The Return of Depression Economics by Paul Krugman, a Nobel laureate, and The New Paradigm for Financial Markets, by George Soros, the famous financier.

These gentlemen are far from slouches when it comes to understanding and explaining economics and finance, but Ahamed's tome stands out for vividly bringing to life the heroes and villains of the financial world, those who brought about the crash of 1929 and those who attempted to prevent it. The reader becomes familiar with these historical figures, as opposed to merely reading of their actions. Writing in The New York Times, Joe Nocera, a business journalist and author, lauds Mr Ahamed's storytelling: "From a literary point of view ? and let me pause to note that this is a beautifully written book; Ahamed has a gift for phrase-making and storytelling that most full-time writers would envy ? the decision to build Lords of Finance around these four men is a brilliant conceit." Most other reviews - including those in Forbes, The Financial Times and The Economist - have been as favourable.

In his book, Mr Ahamed quotes a 19th-century British periodical that called the US "a nation of the most degenerate gamesters in the world." While he personally doesn't employ such vituperative description, he is comfortable placing blame on the US for the current state of affairs, if only by oblique reference. "It's clear to me that some countries are more prone to speculation than others," he says, citing Germans and Swiss as financially conservative populations. But even the cautious have suffered at the hands of the reckless, he says. "One of the ironies of this whole situation is that even prudent countries are being hammered in this economic downturn," Ahamed notes. "Europe has been hit worse than the US, and Japan, which is a nation of savers and has been very prudent for the last 10 years, just saw its GDP go down by 3 per cent in one quarter."

But more precisely, where does the discredit for the crunch lay? In his book Ahamed pins much of the blame for the Depression on the loose policies of central bankers like the American Benjamin Strong, Montagu Norman of Britain, Germany's Hjalmar Schacht and Émile Moreau of France. He detects a pattern of irresponsible monetary policy in more recent crises as well. (A natural sceptic, he started research for his book in 1999 after seeing a Time story hailing Robert Rubin, Lawrence Summers, and Alan Greenspan "the committee to save the world" from the Asian crisis that was then roiling markets.)

"[The current crisis] was not inevitable, nor was the Great Depression," Ahamed claims. "They were caused by a sequence of blunders made by individuals. As they say in Washington, policy is people. There is no question in my mind that there has been mismanagement by certain key people before and during this crisis." One difference Ahamed sees between the meltdowns of today and the Thirties is in public perception. "The bank crisis back then was very obvious, with people queued up outside of banks to take money out," he explains. "The current crisis has been much more subtle, in part because of the growth of what is now called the shadow banking system ? money market funds, investment banks, special purpose vehicles ? all of which look like banks but are operating sort of below the radar and out of the spotlight."

What unfolded in 2008, he says, was essentially a run on the shadow banking industry. "We have had massive shifts of money out of these banks, all through clicks of a mouse instead of queues in the street." Even criminal acts of finance have analogues in the past. "With a bubble comes financial skulduggery of all sorts," Ahamed says. "The equivalent of Bernie Madoff [in the Twenties] was Ivar Kreuger, a Swedish manufacturer of matches who ripped a whole bunch of people off. There were also bankers paying themselves too much and walking a fine legal line. We have it now and we had it then."

Although the present-day global financial crisis is not as severe as the Great Depression, Ahamed views it as just as much of a node in economic history. "I think we will come to view 2008 as the end of an era," he says. "It represents a sea change in the public view of what banks can do, how individuals should behave, what kind of money can be made, the role of government, and the way the financial sector operates. 1929 changed everything for the next 50 years, and I think we're at a similar juncture now."

La Mer lowdown

La Mer beach is open from 10am until midnight, daily, and is located in Jumeirah 1, well after Kite Beach. Some restaurants, like Cupagahwa, are open from 8am for breakfast; most others start at noon. At the time of writing, we noticed that signs for Vicolo, an Italian eatery, and Kaftan, a Turkish restaurant, indicated that these two restaurants will be open soon, most likely this month. Parking is available, as well as a Dh100 all-day valet option or a Dh50 valet service if you’re just stopping by for a few hours.
 

Labour dispute

The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.


- Abdullah Ishnaneh, Partner, BSA Law 

UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
Milestones on the road to union

1970

October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar. 

December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.

1971

March 1:  Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.

July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.

July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.

August 6:  The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.

August 15: Bahrain becomes independent.

September 3: Qatar becomes independent.

November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.

November 29:  At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.

November 30: Despite  a power sharing agreement, Tehran takes full control of Abu Musa. 

November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties

December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.

December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.

December 9: UAE joins the United Nations.

NBA FINALS SO FAR

(Toronto lead 3-2 in best-of-seven series)

Game 1 Raptors 118 Warriors 109

Game 2 Raptors 104 Warriors 109

Game 3 Warriors 109 Raptors 123

Game 4 Warriors 92 Raptors 105

Game 5 Raptors 105 Warriors 106

Game 6 Thursday, at Oakland

Game 7 Sunday, at Toronto (if needed)

What is graphene?

Graphene is a single layer of carbon atoms arranged like honeycomb.

It was discovered in 2004, when Russian-born Manchester scientists Andrei Geim and Kostya Novoselov were "playing about" with sticky tape and graphite - the material used as "lead" in pencils.

Placing the tape on the graphite and peeling it, they managed to rip off thin flakes of carbon. In the beginning they got flakes consisting of many layers of graphene. But as they repeated the process many times, the flakes got thinner.

By separating the graphite fragments repeatedly, they managed to create flakes that were just one atom thick. Their experiment had led to graphene being isolated for the very first time.

At the time, many believed it was impossible for such thin crystalline materials to be stable. But examined under a microscope, the material remained stable, and when tested was found to have incredible properties.

It is many times times stronger than steel, yet incredibly lightweight and flexible. It is electrically and thermally conductive but also transparent. The world's first 2D material, it is one million times thinner than the diameter of a single human hair.

But the 'sticky tape' method would not work on an industrial scale. Since then, scientists have been working on manufacturing graphene, to make use of its incredible properties.

In 2010, Geim and Novoselov were awarded the Nobel Prize for Physics. Their discovery meant physicists could study a new class of two-dimensional materials with unique properties. 

 

Zodi%20%26%20Tehu%3A%20Princes%20Of%20The%20Desert
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EEric%20Barbier%26nbsp%3B%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EYoussef%20Hajdi%2C%20Nadia%20Benzakour%2C%20Yasser%20Drief%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A
Sun jukebox

Rufus Thomas, Bear Cat (The Answer to Hound Dog) (1953)

This rip-off of Leiber/Stoller’s early rock stomper brought a lawsuit against Phillips and necessitated Presley’s premature sale to RCA.

Elvis Presley, Mystery Train (1955)

The B-side of Presley’s final single for Sun bops with a drummer-less groove.

Johnny Cash and the Tennessee Two, Folsom Prison Blues (1955)

Originally recorded for Sun, Cash’s signature tune was performed for inmates of the titular prison 13 years later.

Carl Perkins, Blue Suede Shoes (1956)

Within a month of Sun’s February release Elvis had his version out on RCA.

Roy Orbison, Ooby Dooby (1956)

An essential piece of irreverent juvenilia from Orbison.

Jerry Lee Lewis, Great Balls of Fire (1957)

Lee’s trademark anthem is one of the era’s best-remembered – and best-selling – songs.

The rules of the road keeping cyclists safe

Cyclists must wear a helmet, arm and knee pads

Have a white front-light and a back red-light on their bike

They must place a number plate with reflective light to the back of the bike to alert road-users

Avoid carrying weights that could cause the bike to lose balance

They must cycle on designated lanes and areas and ride safe on pavements to avoid bumping into pedestrians

Defence review at a glance

• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”

• Prioritise a shift towards working with AI and autonomous systems

• Invest in the resilience of military space systems.

• Number of active reserves should be increased by 20%

• More F-35 fighter jets required in the next decade

• New “hybrid Navy” with AUKUS submarines and autonomous vessels

Some of Darwish's last words

"They see their tomorrows slipping out of their reach. And though it seems to them that everything outside this reality is heaven, yet they do not want to go to that heaven. They stay, because they are afflicted with hope." - Mahmoud Darwish, to attendees of the Palestine Festival of Literature, 2008

His life in brief: Born in a village near Galilee, he lived in exile for most of his life and started writing poetry after high school. He was arrested several times by Israel for what were deemed to be inciteful poems. Most of his work focused on the love and yearning for his homeland, and he was regarded the Palestinian poet of resistance. Over the course of his life, he published more than 30 poetry collections and books of prose, with his work translated into more than 20 languages. Many of his poems were set to music by Arab composers, most significantly Marcel Khalife. Darwish died on August 9, 2008 after undergoing heart surgery in the United States. He was later buried in Ramallah where a shrine was erected in his honour.

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
Jawan
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EAtlee%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Shah%20Rukh%20Khan%2C%20Nayanthara%2C%20Vijay%20Sethupathi%26nbsp%3B%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E4%2F5%3C%2Fp%3E%0A
BAD%20BOYS%3A%20RIDE%20OR%20DIE
%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Adil%20El%20Arbi%20and%20Bilall%20Fallah%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EWill%20Smith%2C%20Martin%20Lawrence%2C%20Joe%20Pantoliano%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%203.5%2F5%3C%2Fp%3E%0A
How to protect yourself when air quality drops

Install an air filter in your home.

Close your windows and turn on the AC.

Shower or bath after being outside.

Wear a face mask.

Stay indoors when conditions are particularly poor.

If driving, turn your engine off when stationary.