WASHINGTON // As world leaders headed to Washington for a weekend summit on the global financial crisis, the United States made a pitch for modest reforms instead of the stiffer regulation that some European countries favour.
"The crisis was not a failure of the free market system," George W Bush told a New York audience yesterday ahead of tonight's dinner and tomorrow's meeting of the heads of the Group of 20 developed and emerging nations.
The greater threat to prosperity is "not too little government involvement, it is too much government involvement in the market," Mr Bush said.
The message may ring hollow with some G20 countries that say under-regulated US financial industries effectively exported to the global economy a crisis that originated in reckless US mortgage lending.
The Brazilian president Luiz Inacio Lula da Silva said last weekend in Sao Paulo, where G20 finance ministers met, that the world economic order "collapsed like a house of cards" because of a "dogmatic faith in non-intervention in markets."
Brazil, which holds this year's G20 chairmanship, is one of the key emerging-market nations joining leaders from the old-line Group of Seven rich nations for talks that implicitly acknowledge the rapidly growing emerging powers now deserve a bigger say in how global finance operates.
Others include China, India, South Africa and South Korea.
As leading G7 economies like the United States and Germany sink into recession, emerging markets are seen as potential sources of growth that may bring a recovery, though not soon.
"We are going to have to face up to a very difficult and long-lasting economic crisis," Germany's deputy economy minister, Walther Otremba, told Reuters.
Germany's economy, Europe's largest, shrank by 0.5 per cent in the third quarter to put Germany in recession for the first time in five years.
The G20 meeting, coming with only two months left for the Bush administration, has not generated high expectations.
But participants said the devastation wrought on household wealth, corporate balance sheets and government budgets by the financial crisis made it urgent to at least begin charting a course for avoiding similar disasters in future.
*Reuters
How to get exposure to gold
Although you can buy gold easily on the Dubai markets, the problem with buying physical bars, coins or jewellery is that you then have storage, security and insurance issues.
A far easier option is to invest in a low-cost exchange traded fund (ETF) that invests in the precious metal instead, for example, ETFS Physical Gold (PHAU) and iShares Physical Gold (SGLN) both track physical gold. The VanEck Vectors Gold Miners ETF invests directly in mining companies.
Alternatively, BlackRock Gold & General seeks to achieve long-term capital growth primarily through an actively managed portfolio of gold mining, commodity and precious-metal related shares. Its largest portfolio holdings include gold miners Newcrest Mining, Barrick Gold Corp, Agnico Eagle Mines and the NewMont Goldcorp.
Brave investors could take on the added risk of buying individual gold mining stocks, many of which have performed wonderfully well lately.
London-listed Centamin is up more than 70 per cent in just three months, although in a sign of its volatility, it is down 5 per cent on two years ago. Trans-Siberian Gold, listed on London's alternative investment market (AIM) for small stocks, has seen its share price almost quadruple from 34p to 124p over the same period, but do not assume this kind of runaway growth can continue for long
However, buying individual equities like these is highly risky, as their share prices can crash just as quickly, which isn't what what you want from a supposedly safe haven.
Company Profile
Name: Direct Debit System
Started: Sept 2017
Based: UAE with a subsidiary in the UK
Industry: FinTech
Funding: Undisclosed
Investors: Elaine Jones
Number of employees: 8
PROFILE
Name: Enhance Fitness
Year started: 2018
Based: UAE
Employees: 200
Amount raised:+$3m
Investors: Global Ventures and angel investors
The specs
Engine: 8.0-litre, quad-turbo 16-cylinder
Transmission: 7-speed auto
0-100kmh 2.3 seconds
0-200kmh 5.5 seconds
0-300kmh 11.6 seconds
Power: 1500hp
Torque: 1600Nm
Price: Dh13,400,000
On sale: now
Hydrogen: Market potential
Hydrogen has an estimated $11 trillion market potential, according to Bank of America Securities and is expected to generate $2.5tn in direct revenues and $11tn of indirect infrastructure by 2050 as its production increases six-fold.
"We believe we are reaching the point of harnessing the element that comprises 90 per cent of the universe, effectively and economically,” the bank said in a recent report.
Falling costs of renewable energy and electrolysers used in green hydrogen production is one of the main catalysts for the increasingly bullish sentiment over the element.
The cost of electrolysers used in green hydrogen production has halved over the last five years and will fall to 60 to 90 per cent by the end of the decade, acceding to Haim Israel, equity strategist at Merrill Lynch. A global focus on decarbonisation and sustainability is also a big driver in its development.
Company Profile
Company name: Cargoz
Date started: January 2022
Founders: Premlal Pullisserry and Lijo Antony
Based: Dubai
Number of staff: 30
Investment stage: Seed