SCO – the next counterforce to NATO?

I view the upcoming Shanghai Cooperation Organization (SCO)’s “anti-terrorist operation” (“Peace Mission 2007”) sends a strong signal to NATO that one day, there could be another intergovernmental coalition that can counter the West, at least militarily speaking.

Think this is just another ephemeral, loosely organized coalition? SCO was formed mainly by China and Russia, with members including Kazakhstan, Kyrgyz Republic, Tajikistan and Uzbekistan. The organization also has 4 “observers” including Mongolia, India, Pakistan and Iran. Geographically, SCO covers a large eastern portion of Eurasia. Economically, it covers 3 out of the 4 BRIC nations.

The timing of the exercise is sensitive – just a moth after US’s announcement on planning to install strategic missile defense system in Poland and Czech Republic, both were part of former Soviet Union. From the scope of the exercise: the number of ground troops, air power, to missile systems, it’s difficult not to believe the objective of the “mission” is to enervate upcoming enemies from the West. As Noam Chomsky asked - has the new Cold War already started?

The Agenda

The Agenda with Steve Paikin on TVO (TV Ontario) is by far the most informative political and news talk show in Canada. The topics range from Foreign Affairs, National Politics, Environment, to Religion. The show invites experts with different views and serves as a great intellectual debate venue. Steve often mitigates these fervid discussions among guests. I don’t think there are other similar shows on US / Canadian cable, or even on PBS or BBC that match the quality and depth of the discussion. The show now has an official Facebook group.

Euler's identity

Thanks to Swiss mathematician Leonhard Euler, some said this is the greatest mathematical theorem. The formula contains many key elements in math: real number, imaginary unit, addition, multiplication, and exponentiation. This is amazing. I wish I knew more about math to appreciate the beauty of the equation.

Here, first we have the Euler’s number e:

Then the imaginary unit i:

The last, we have pi:

And the Euler’s Formula states:

or more commonly expressed as:

2007 Press Lions Winners

Here are a few of my favourites this year. Got to love good ads.

1. Title: MY GIRLFRIEND

Category: Toiletries

Advertiser/Client: PROCTER & GAMBLE
Product/Service: GLIDE DENTAL FLOSS
Entrant Company, City: SAATCHI & SAATCHI, New York
Country: USA

2. Title: RAILCYCLE

Category: Entertainment & Leisure

Advertiser/Client: CLIMA CO
Product/Service: CLIMA BICYCLE LOCK Entrant Company,
City: LEO BURNETT, Bangkok
Country: THAILAND

3. Title: OIL

Category: Household: Other
Advertiser/Client: KIMBERLY-CLARK TRADING (M)
Product/Service: SCOTT KITCHEN TOWELS
Entrant Company: JWT KUALA LUMPUR
Country: MALAYSIA

4. Title: LONDON

Category: Clothing, Footwear & Accessories
Advertiser/Client: DIESEL
Product/Service: DIESEL CLOTHING
Entrant Company: MARCEL PARIS
Country: FRANCE

5. DAD & SON

Category: Entertainment & Leisure
Advertiser/Client: MONACO
Product/Service: $9.95 PC GAMES
Entrant Company, City: COLENSO BBDO, Auckland
Country: NEW ZEALAND

6. CACTUS

Category: Publications & Media
Advertiser/Client: MTV NETWORKS & CO.
Product/Service: MTV COMEDY CENTRAL CHANEL
Entrant Company, City: KEMPERTRAUTMANN, Hamburg
Country: GERMANY

7. Title: GUIDE DOG

Category: Entertainment & Leisure
Advertiser/Client: SONY COMPUTER ENTERTAINMENT
Product/Service: SONY PLAYSTATION
Entrant Company: TBWA\MADRID

Country: SPAIN

8. Title: ICE

Category: Retail Stores
Advertiser/Client: HARVEY NICHOLS
Product/Service: DEPARTMENT STORE
Entrant Company: DDB LONDON
Country: UNITED KINGDOM

$284 Billion Farm Bill Approved by the House

Today, the House approved the Farm Bill – a $284 billion, 5-year legislation that critics claim to be one of the root causes for global food dearth, poverty, and the delay in the development of renewable energy. Earlier today, the House also voted down the amendment authored by Rep Ron Kind (D-Wis.) and Rep Jeff Flake (R-Ariz.) that proposed a set of new restrictions to scale back subsidies to crops farmers. This is a major impediment on the effort to overhaul the amiss and antiquated agriculture policy.

The Farm Bill is one of the most influential piece of legislations in terms its impact on food supply in less developed countries; on agriculture business in Central and South America, Africa and parts of the South East Asia; and on the energy policies in US and Canada.

Michael Pollan, author of “The Omnivore's Dilemma: A Natural History of Four Meals”, suggested that US Farm Bill has a direct impact on world poverty and the health of the nation. Iain Murray of the Competitive Enterprise Institute also pointed out that the existing Farm Bill is partially to be blamed on the current food shortage in Africa and the delay in developing fuel independent policy in Washington, D.C..

For example, due to the over-subsidized corn production, there is a huge shortage of tortilla in Mexico, adversely affecting the Mexican farmers. The result of corn over-supply in US is what you see in today’s grocery store: pops and junk foods cost way less than fruits and vegetables. Low income families as a result can not afford healthy diets and make junk or fast food (high in corn sugar) as the quid pro quo. The vicious cycle goes on.

The apathy in US public opinion towards this issue is somewhat surprising and disappointing. The bill is one of the a few legislations ironically engenders bipartisan support. Unfortunately, Washington politics have prevented a national debate on this issue and created sets of perplexing problems that were never to be imagined by those first introduced the bill during the Great Depression.

Water, the Blue Gold?

Supply shortage of drinking water in Asia, Middle East, and Africa is nothing new. In the continental Europe, demand for water in industrial and commercial use has been a concern for not only the environmentalists but state government and businesses (including farming). Droughts and water conservation have become a top priority for many EU members in recent years.

Water is also an essential part of economic growth for developing countries such as India and China. The reason is simple: almost all basic material and manufacturing planets need clean water to operate. The depletion of water level is definitely solicitude for these regions.

As a result, interest in waster investment is fervid among institutional players. The launch of water ETFs, such as Claymore’s S&P Global Water Index (AMEX: CGW) is a good example of how Wall Street is eyeing for the next gold rush.

Two leading water treatment and purification candidates should be considered when making a long term water play: Veolia Environnement SA (NYSE & PARIS: VE) and Suez (NYSE & PARIS: SZE).

These two French multi-nationals have invested substantially in water infrastructure around the globe. Veolia is currently the world’s largest water supplier. Suez, on the other hand, is one of the largest environmental and utility companies in the world. Veolia’s recent win in Australia and Suez’s China expansion are just two of many examples of their global dominance in securing water deals for drinking and industrial use.

Suez is currently trading around 14 times 2008 earning estimate – lower than most its competitors in US and other countries. Veolia is trading at around 28 times the estimated 2008 earning – a premium resulted from a recent bullish outlook in this sector. Both companies also provide healthy dividends: Veolia has a yield of 3.2% while Suez provides 2.5%.

I’m not claiming that water is the next oil, copper or uranium. However, the prospect of long-term demand and an increase in public infrastructure investment from countries around the world put water in a unique situation. If you happen to live in Canada or US, try to buy a bottle of water at a gas station. You will likely find that a liter of bottle water costs more than a liter of gas.

Companies that take advantages of such global trends should perform well for value investors. Both Veolia and Suez fit into this category.

Questions on Afghanistan

No one will dispute the current conflicts in Afghanistan is a perplexing situation.

To offer realistic solutions to the problem, we need to look back history and prepare to discuss and answer basic questions such as ones purposed here.

Is this a war primary on political and religious ideology? Or is this a war on controlling key economic interests in the region?

Why do Western countries such as Canada, NATO, and the United States want to fight the Taliban and al-Qaeda forces in Afghanistan?

Is the main purpose of current war in Afghanistan to promote Western-style democracy in a war-torn, impecunious Muslim nation that has not had an opportunity to enjoy freedom and the benefits of market-based economy?

Is this war about the political and religious differences between the Islamic fundamentalists and the West?

What can we learn from Soviet’s lost war in Afghanistan during the 1980s?

Can NATO and US afford to withdraw from Afghanistan? What are the consequences of withdrawing? Can this war ever be won by the West?

For an average citizen in Canada, why does he or she have to care about this war?

This is just the beginning....