|QA->…..is the sort of a speculator; who stands to gain with a rise in the price of shares and stocks?....|
|QA->"Whatever the religion, attire, language and such other things of human kind, as they belong to same cast (species) there is no harm in interdining and intermarriage between them" - Sree Narayana Guru made this suggestion to ?....|
|QA->"Whatever the religion, attire, language and such other things of human kind, as they belong to same cast (species) there is no harm in interdining and intermarriage between them" - Sree Narayana Guru made this suggestion to....|
|QA->Name the cult hit by Korean hip-hop star Psy which has become the most viewed YouTube video of all time, beating the previous record-holder, Justin Bieber"s "Baby."?....|
|QA->A watercolour painting by a famous dictator has sold for 130,000 euros (£103,000) at auction in Germany, despite controversy over its sale. Name that dictator?....|
|MCQ-> In the annals of investing, Warren Buffett stands alone. Starting from scratch, simply by picking stocks and companies for investment, Buffett amassed one of the epochal fortunes of the twentieth century. Over a period of four decades more than enough to iron out the effects of fortuitous rolls of the dice, Buffett outperformed the stock market, by a stunning margin and without taking undue risks or suffering a single losing year. Buffett did this in markets bullish and bearish and through economies fat and lean, from the Eisenhower years to Bill Clinton, from the l950s to the l990s, from saddle shoes and Vietnam to junk bonds and the information age. Over the broad sweep of postwar America, as the major stock averages advanced by 11 percent or so a year, Buffett racked up a compounded annual gain of 29.2 percent. The uniqueness of this achievement is more significant in that it was the fruit of old-fashioned, long-term investing. Wall Street’s modern financiers got rich by exploiting their control of the public's money: their essential trick was to take in and sell out the public at opportune moments. Buffett shunned this game, as well as the more venal excesses for which Wall Street is deservedly famous. In effect, he rediscovered the art of pure capitalism, a cold-blooded sport, but a fair one. Buffett began his career, working out his study in Omaha in 1956. His grasp of simple verities gave rise to a drama that would recur throughout his life. Long before those pilgrimages to Omaha, long before Buffett had a record, he would stand in a comer at college parties, baby-faced and bright-eyed, holding forth on the universe as a dozen or two of his older, drunken fraternity brothers crowded around. A few years later, when these friends had metamorphosed into young associates starting out on Wall Street, the ritual was the same. Buffett, the youngest of the group, would plop himself in a big, broad club chair and expound on finance while the others sat at his feet. On Wall Street, his homespun manner made him a cult figure. Where finance was so forbiddingly complex, Buffett could explain it like a general-store clerk discussing the weather. He never forgot that underneath each stock and bond, no matter how arcane, there lay a tangible, ordinary business. Beneath the jargon of Wall Street, he seemed to unearth a street from small-town America. In such a complex age, what was stunning about Buffett was his applicability. Most of what Buffett did was imitable by the average person (this is why the multitudes flocked to Omaha). It is curious irony that as more Americans acquired an interest in investing, Wall Street became more complex and more forbidding than ever. Buffett was born in the midst of depression. The depression cast a long shadow on Americans, but the post war prosperity eclipsed it. Unlike the modern portfolio manager, whose mind- set is that of a trader, Buffett risked his capital on the long term growth of a few select businesses. In this, he resembled the magnates of a previous age, such as J P Morgan Sr.As Jack Newfield wrote of Robert Kennedy, Buffett was not a hero, only a hope; not a myth, only a man. Despite his broad wit, he was strangely stunted. When he went to Paris, his only reaction was that he had no interest in sight-seeing and that the food was better in Omaha. His talent sprang from his unrivaled independence of mind and ability to focus on his work and shut out the world, yet those same qualities exacted a toll. Once, when Buffett was visiting the publisher Katharine Graham on Martha’s Vineyard, a friend remarked on the beauty of the sunset. Buffett replied that he hadn't focused on it, as though it were necessary for him to exert a deliberate act of concentration to "focus" on a sunset. Even at his California beachfront vacation home, Buffett would work every day for weeks and not go near the water. Like other prodigies, he paid a price. Having been raised in a home with more than its share of demons, he lived within an emotional fortress. The few people who shared his office had no knowledge of the inner man, even after decades. Even his children could scarcely recall a time when he broke through his surface calm and showed some feeling. Though part of him is a showman or preacher, he is essentially a private person. Peter Lynch, the mutual-fund wizard, visited Buffett in the 1980s and was struck by the tranquility in his inner sanctum. His archives, neatly alphabetized in metal filing cabinets, looked as files had in another era. He had no armies of traders, no rows of electronic screens, as Lynch did. Buffett had no price charts, no computer - only a newspaper clipping from 1929 and an antique ticker under a glass dome. The two of them paced the floor, recounting their storied histories, what they had bought, what they had sold. Where Lynch had kicked out his losers every few weeks, Buffett had owned mostly the same few stocks for years and years. Lynch felt a pang, as though he had traveled back in time. Buffett’s one concession to modernity is a private jet. Otherwise, he derives little pleasure from spending his fabulous wealth. He has no art collection or snazzy car, and he has never lost his taste for hamburgers. He lives in a commonplace house on a tree-lined block, on the same street where he works. His consuming passion - and pleasure - is his work, or, as he calls it, his canvas. It is there that he revealed the secrets of his trade, and left a self-portrait.“Saddle shoes and Vietnam”, as expressed in the passage, refers to: I. Denier cri and Vietnam war II. Growth of leather footwear industry and Vietnam shoe controversy III. Modern U.S. population and traditional expatriates IV. Industrial revolution and Vietnam Olympics V. Fashion and Politics....|
|MCQ-> Read the following passage carefully and answer the questions given below it. Certain words/phrases have been printed in bold tohelp you locate them while answering some of the questions. During the last few years, a lot of hype has been heaped on the BRICS (Brazil, Russia, India, China, and South Africa). With their large populations and rapid growth, these countries, so the argument goes, will soon become some of the largest economies in the world and, in the case of China, the largest of all by as early as 2020. But the BRICS, as well as many other emerging-market economieshave recently experienced a sharp economic slowdown. So, is the honeymoon over? Brazil’s GDP grew by only 1% last year, and may not grow by more than 2% this year, with its potential growth barely above 3%. Russia’s economy may grow by barely 2% this year, with potential growth also at around 3%, despite oil prices being around $100 a barrel. India had a couple of years of strong growth recently (11.2% in 2010 and 7.7% in 2011) but slowed to 4% in 2012. China’s economy grew by 10% a year for the last three decades, but slowed to 7.8% last year and risks a hard landing. And South Africa grew by only 2.5% last year and may not grow faster than 2% this year. Many other previously fast-growing emerging-market economies – for example, Turkey, Argentina, Poland, Hungary, and many in Central and Eastern Europe are experiencing a similar slowdown. So, what is ailing the BRICS and other emerging markets? First, most emerging-market economies were overheating in 2010-2011, with growth above potential and inflation rising and exceeding targets. Many of them thus tightened monetary policy in 2011, with consequences for growth in 2012 that have carried over into this year. Second, the idea that emerging-market economies could fully decouple from economic weakness in advanced economies was farfetched : recession in the eurozone, near-recession in the United Kingdom and Japan in 2011-2012, and slow economic growth in the United States were always likely to affect emerging market performance negatively – via trade, financial links, and investor confidence. For example, the ongoing euro zone downturn has hurt Turkey and emergingmarket economies in Central and Eastern Europe, owing to trade links. Third, most BRICS and a few other emerging markets have moved toward a variant of state capitalism. This implies a slowdown in reforms that increase the private sector’s productivity and economic share, together with a greater economic role for state-owned enterprises (and for state-owned banks in the allocation of credit and savings), as well as resource nationalism, trade protectionism, import substitution industrialization policies, and imposition of capital controls. This approach may have worked at earlier stages of development and when the global financial crisis caused private spending to fall; but it is now distorting economic activity and depressing potential growth. Indeed, China’s slowdown reflects an economic model that is, as former Premier Wen Jiabao put it, “unstable, unbalanced, uncoordinated, and unsustainable,” and that now is adversely affecting growth in emerging Asia and in commodity-exporting emerging markets from Asia to Latin America and Africa. The risk that China will experience a hard landing in the next two years may further hurt many emerging economies. Fourth, the commodity super-cycle that helped Brazil, Russia, South Africa, and many other commodity-exporting emerging markets may be over. Indeed, a boom would be difficult to sustain, given China’s slowdown, higher investment in energysaving technologies, less emphasis on capital-and resource-oriented growth models around the world, and the delayed increase in supply that high prices induced. The fifth, and most recent, factor is the US Federal Reserve’s signals that it might end its policy of quantitative easing earlier than expected, and its hints of an even tual exit from zero interest rates. both of which have caused turbulence in emerging economies’ financial markets. Even before the Fed’s signals, emergingmarket equities and commodities had underperformed this year, owing to China’s slowdown. Since then, emerging-market currencies and fixed-income securities (government and corporate bonds) have taken a hit. The era of cheap or zerointerest money that led to a wall of liquidity chasing high yields and assets equities, bonds, currencies, and commodities – in emerging markets is drawing to a close. Finally, while many emerging-market economies tend to run current-account surpluses, a growing number of them – including Turkey, South Africa, Brazil, and India – are running deficits. And these deficits are now being financed in riskier ways: more debt than equity; more short-term debt than longterm debt; more foreign-currency debt than local-currency debt; and more financing from fickle cross-border interbank flows. These countries share other weaknesses as well: excessive fiscal deficits, abovetarget inflation, and stability risk (reflected not only in the recent political turmoil in Brazil and Turkey, but also in South Africa’s labour strife and India’s political and electoral uncertainties). The need to finance the external deficit and to avoid excessive depreciation (and even higher inflation) calls for raising policy rates or keeping them on hold at high levels. But monetary tightening would weaken already-slow growth. Thus, emerging economies with large twin deficits and other macroeconomic fragilities may experience further downward pressure on their financial markets and growth rates. These factors explain why growth in most BRICS and many other emerging markets has slowed sharply. Some factors are cyclical, but others – state capitalism, the risk of a hard landing in China, the end of the commodity supercycle -are more structural. Thus, many emerging markets’ growth rates in the next decade may be lower than in the last – as may the outsize returns that investors realised from these economies’ financial assets (currencies, equities. bonds, and commodities). Of course, some of the better-managed emerging-market economies will continue to experitnce rapid growth and asset outperformance. But many of the BRICS, along with some other emerging economies, may hit a thick wall, with growth and financial markets taking a serious beating.Which of the following statement(s) is/are true as per the given information in the passage ? A. Brazil’s GDP grew by only 1% last year, and is expected to grow by approximately 2% this year. B. China’s economy grew by 10% a year for the last three decades but slowed to 7.8% last year. C. BRICS is a group of nations — Barzil, Russia, India China and South Africa.....|
|MCQ-> The broad scientific understanding today is that our planet is experiencing a warming trend over and above natural and normal variations that is almost certainly due to human activities associated with large-scale manufacturing. The process began in the late 1700s with the Industrial Revolution, when manual labor, horsepower, and water power began to be replaced by or enhanced by machines. This revolution, over time, shifted Britain, Europe, and eventually North America from largely agricultural and trading societies to manufacturing ones, relying on machinery and engines rather than tools and animals.The Industrial Revolution was at heart a revolution in the use of energy and power. Its beginning is usually dated to the advent of the steam engine, which was based on the conversion of chemical energy in wood or coal to thermal energy and then to mechanical work primarily the powering of industrial machinery and steam locomotives. Coal eventually supplanted wood because, pound for pound, coal contains twice as much energy as wood (measured in BTUs, or British thermal units, per pound) and because its use helped to save what was left of the world's temperate forests. Coal was used to produce heat that went directly into industrial processes, including metallurgy, and to warm buildings, as well as to power steam engines. When crude oil came along in the mid- 1800s, still a couple of decades before electricity, it was burned, in the form of kerosene, in lamps to make light replacing whale oil. It was also used to provide heat for buildings and in manufacturing processes, and as a fuel for engines used in industry and propulsion.In short, one can say that the main forms in which humans need and use energy are for light, heat, mechanical work and motive power, and electricity which can be used to provide any of the other three, as well as to do things that none of those three can do, such as electronic communications and information processing. Since the Industrial Revolution, all these energy functions have been powered primarily, but not exclusively, by fossil fuels that emit carbon dioxide (CO2), To put it another way, the Industrial Revolution gave a whole new prominence to what Rochelle Lefkowitz, president of Pro-Media Communications and an energy buff, calls "fuels from hell" - coal, oil, and natural gas. All these fuels from hell come from underground, are exhaustible, and emit CO2 and other pollutants when they are burned for transportation, heating, and industrial use. These fuels are in contrast to what Lefkowitz calls "fuels from heaven" -wind, hydroelectric, tidal, biomass, and solar power. These all come from above ground, are endlessly renewable, and produce no harmful emissions.Meanwhile, industrialization promoted urbanization, and urbanization eventually gave birth to suburbanization. This trend, which was repeated across America, nurtured the development of the American car culture, the building of a national highway system, and a mushrooming of suburbs around American cities, which rewove the fabric of American life. Many other developed and developing countries followed the American model, with all its upsides and downsides. The result is that today we have suburbs and ribbons of highways that run in, out, and around not only America s major cities, but China's, India's, and South America's as well. And as these urban areas attract more people, the sprawl extends in every direction.All the coal, oil, and natural gas inputs for this new economic model seemed relatively cheap, relatively inexhaustible, and relatively harmless-or at least relatively easy to clean up afterward. So there wasn't much to stop the juggernaut of more people and more development and more concrete and more buildings and more cars and more coal, oil, and gas needed to build and power them. Summing it all up, Andy Karsner, the Department of Energy's assistant secretary for energy efficiency and renewable energy, once said to me: "We built a really inefficient environment with the greatest efficiency ever known to man."Beginning in the second half of the twentieth century, a scientific understanding began to emerge that an excessive accumulation of largely invisible pollutants-called greenhouse gases - was affecting the climate. The buildup of these greenhouse gases had been under way since the start of the Industrial Revolution in a place we could not see and in a form we could not touch or smell. These greenhouse gases, primarily carbon dioxide emitted from human industrial, residential, and transportation sources, were not piling up along roadsides or in rivers, in cans or empty bottles, but, rather, above our heads, in the earth's atmosphere. If the earth's atmosphere was like a blanket that helped to regulate the planet's temperature, the CO2 buildup was having the effect of thickening that blanket and making the globe warmer.Those bags of CO2 from our cars float up and stay in the atmosphere, along with bags of CO2 from power plants burning coal, oil, and gas, and bags of CO2 released from the burning and clearing of forests, which releases all the carbon stored in trees, plants, and soil. In fact, many people don't realize that deforestation in places like Indonesia and Brazil is responsible for more CO2 than all the world's cars, trucks, planes, ships, and trains combined - that is, about 20 percent of all global emissions. And when we're not tossing bags of carbon dioxide into the atmosphere, we're throwing up other greenhouse gases, like methane (CH4) released from rice farming, petroleum drilling, coal mining, animal defecation, solid waste landfill sites, and yes, even from cattle belching. Cattle belching? That's right-the striking thing about greenhouse gases is the diversity of sources that emit them. A herd of cattle belching can be worse than a highway full of Hummers. Livestock gas is very high in methane, which, like CO2, is colorless and odorless. And like CO2, methane is one of those greenhouse gases that, once released into the atmosphere, also absorb heat radiating from the earth's surface. "Molecule for molecule, methane's heat-trapping power in the atmosphere is twenty-one times stronger than carbon dioxide, the most abundant greenhouse gas.." reported Science World (January 21, 2002). “With 1.3 billion cows belching almost constantly around the world (100 million in the United States alone), it's no surprise that methane released by livestock is one of the chief global sources of the gas, according to the U.S. Environmental Protection Agency ... 'It's part of their normal digestion process,' says Tom Wirth of the EPA. 'When they chew their cud, they regurgitate [spit up] some food to rechew it, and all this gas comes out.' The average cow expels 600 liters of methane a day, climate researchers report." What is the precise scientific relationship between these expanded greenhouse gas emissions and global warming? Experts at the Pew Center on Climate Change offer a handy summary in their report "Climate Change 101. " Global average temperatures, notes the Pew study, "have experienced natural shifts throughout human history. For example; the climate of the Northern Hemisphere varied from a relatively warm period between the eleventh and fifteenth centuries to a period of cooler temperatures between the seventeenth century and the middle of the nineteenth century. However, scientists studying the rapid rise in global temperatures during the late twentieth century say that natural variability cannot account for what is happening now." The new factor is the human factor-our vastly increased emissions of carbon dioxide and other greenhouse gases from the burning of fossil fuels such as coal and oil as well as from deforestation, large-scale cattle-grazing, agriculture, and industrialization.“Scientists refer to what has been happening in the earth’s atmosphere over the past century as the ‘enhanced greenhouse effect’”, notes the Pew study. By pumping man- made greenhouse gases into the atmosphere, humans are altering the process by which naturally occurring greenhouse gases, because of their unique molecular structure, trap the sun’s heat near the earth’s surface before that heat radiates back into space."The greenhouse effect keeps the earth warm and habitable; without it, the earth's surface would be about 60 degrees Fahrenheit colder on average. Since the average temperature of the earth is about 45 degrees Fahrenheit, the natural greenhouse effect is clearly a good thing. But the enhanced greenhouse effect means even more of the sun's heat is trapped, causing global temperatures to rise. Among the many scientific studies providing clear evidence that an enhanced greenhouse effect is under way was a 2005 report from NASA's Goddard Institute for Space Studies. Using satellites, data from buoys, and computer models to study the earth's oceans, scientists concluded that more energy is being absorbed from the sun than is emitted back to space, throwing the earth's energy out of balance and warming the globe."Which of the following statements is correct? (I) Greenhouse gases are responsible for global warming. They should be eliminated to save the planet (II) CO2 is the most dangerous of the greenhouse gases. Reduction in the release of CO2 would surely bring down the temperature (III) The greenhouse effect could be traced back to the industrial revolution. But the current development and the patterns of life have enhanced their emissions (IV) Deforestation has been one of the biggest factors contributing to the emission of greenhouse gases Choose the correct option:....|
I want to stress this personal helplessness we are all stricken with in the face of a system that has passed beyond our knowledge and control. To bring it nearer home, I propose that we switch off from the big things like empires and their wars to more familiar little things. Take pins for example! I do not know why it is that I so seldom use a pin when my wife cannot get on without boxes of them at hand; but it is so; and I will therefore take pins as being for some reason specially important to women.There was a time when pinmakers would buy the material; shape it; make the head and the point; ornament it; and take it to the market, and sell it and the making required skill in several operations. They not only knew how the thing was done from beginning to end, but could do it all by themselves. But they could not afford to sell you a paper of pins for the farthing. Pins cost so much that a woman's dress allowance was calling pin money.By the end of the 18th century Adam Smith boasted that it took 18 men to make a pin, each man doing a little bit of the job and passing the pin on to the next, and none of them being able to make a whole pin or to buy the materials or to sell it when it was made. The most you could say for them was that at least they had some idea of how it was made, though they could not make it. Now as this meant that they were clearly less capable and knowledgeable men than the old pin-makers, you may ask why Adam Smith boasted of it as a triumph of civilisation when its effect had so clearly a degrading effect. The reason was that by setting each man to do just one little bit of the work and nothing but that, over and over again, he became very quick at it. The men, it is said, could turn out nearly 5000 pins a day each; and thus pins became plentiful and cheap. The country was supposed to be richer because it had more pins, though it had turned capable men into mere machines doing their work without intelligence and being fed by the spare food of the capitalist just as an engine is fed with coals and oil. That was why the poet Goldsmith, who was a farsighted economist as well as a poet, complained that 'wealth accumulates, and men decay'.Nowadays Adam Smith's 18 men are as extinct as the diplodocus. The 18 flesh-and-blood men have been replaced by machines of steel which spout out pins by the hundred million. Even sticking them into pink papers is done by machinery. The result is that with the exception of a few people who design the machines, nobody knows how to make a pin or how a pin is made: that is to say, the modern worker in pin manufacture need not be one-tenth so intelligent, skilful and accomplished as the old pinmaker; and the only compensation we have for this deterioration is that pins are so cheap that a single pin has no expressible value at all. Even with a big profit stuck on to the cost-price you can buy dozens for a farthing; and pins are so recklessly thrown away and wasted that verses have to be written to persuade children (without success) that it is a sin to steal, if even it’s a pin.Many serious thinkers, like John Ruskin and William Morris, have been greatly troubled by this, just as Goldsmith was, and have asked whether we really believe that it is an advance in wealth to lose our skill and degrade our workers for the sake of being able to waste pins by the ton. We shall see later on, when we come to consider the Distribution of Leisure, that the cure for this is not to go back to the old free for higher work than pin-making or the like. But in the meantime the fact remains that the workers are now not able to make anything themselves even in little bits. They are ignorant and helpless, and cannot lift their finger to begin their day's work until it has all been arranged for them by their employer's who themselves do not understand the machines they buy, and simply pay other people to set them going by carrying out the machine maker's directions.The same is true for clothes. Earlier the whole work of making clothes, from the shearing of the sheep to the turning out of the finished and washed garment ready to put on, had to be done in the country by the men and women of the household, especially the women; so that to this day an unmarried woman is called a spinster. Nowadays nothing is left of all this but the sheep shearing; and even that, like the milking of cows, is being done by machinery, as the sewing is. Give a woman a sheep today and ask her to produce a woollen dress for you; and not only will she be quite unable to do it, but you are likely to find that she is not even aware of any connection between sheep and clothes. When she gets her clothes, which she does by buying them at the shop, she knows that there is a difference between wool and cotton and silk, between flannel and merino, perhaps even between stockinet and other wefts; but as to how they are made, or what they are made of, or how they came to be in the shop ready for her to buy, she knows hardly anything. And the shop assistant from whom she buys is no wiser. The people engaged in the making of them know even less; for many of them are too poor to have much choice of materials when they buy their own clothes.Thus the capitalist system has produced an almost universal ignorance of how things are made and done, whilst at the same time it has caused them to be made and done on a gigantic scale. We have to buy books and encyclopaedias to find out what it is we are doing all day; and as the books are written by people who are not doing it, and who get their information from other books, what they tell us is twenty to fifty years out of date knowledge and almost impractical today. And of course most of us are too tired of our work when we come home to want to read about it; what we need is cinema to take our minds off it and feel our imagination.It is a funny place, this word of capitalism, with its astonishing spread of education and enlightenment. There stand the thousands of property owners and the millions of wage workers, none of them able to make anything, none of them knowing what to do until somebody tells them, none of them having the least notion of how it is made that they find people paying them money, and things in the shops to buy with it. And when they travel they are surprised to find that savages and Esquimaux and villagers who have to make everything for themselves are more intelligent and resourceful! The wonder would be if they were anything else. We should die of idiocy through disuse of our mental faculties if we did not fill our heads with romantic nonsense out of illustrated newspapers and novels and plays and films. Such stuff keeps us alive, but it falsifies everything for us so absurdly that it leaves us more or less dangerous lunatics in the real world.Excuse my going on like this; but as I am a writer of books and plays myself, I know the folly and peril of it better than you do. And when I see that this moment of our utmost ignorance and helplessness, delusion and folly, has been stumbled on by the blind forces of capitalism as the moment for giving votes to everybody, so that the few wise women are hopelessly overruled by the thousands whose political minds, as far as they can be said to have any political minds at all, have been formed in the cinema, I realise that I had better stop writing plays for a while to discuss political and social realities in this book with those who are intelligent enough to listen to me.A suitable title to the passage would be|
Read the following passage carefully and answer the questions given below it. Certain words/phrases have been printed in bold to help you locate them while answering some of the questions. The past quarter of a century has seen several bursts of selling by the world’s governments, mostly but not always in benign market conditions. Those in the OECD, a rich-country club, divested plenty of stuff in the 20 years before the global financial crisis. The first privatisation wave, which built up from the mid-1980s and peaked in 2000, was largely European. The drive to cut state intervention under Margaret Thatcher in Britain soon spread to the continent. The movement gathered pace after 1991, when eastern Europe put thousands of rusting state-owned enterprises (SOEs) on the block. A second wave came in the mid-2000s, as European economies sought to cash in on buoyant markets. But activity in OECD countries slowed sharply as the financial crisis began. In fact, it reversed. Bailouts of failing banks and companies have contributed to a dramatic increase in government purchases of corporate equity during the past five years. A more lasting fea ture is the expansion of the state capitalism practised by China and other emerging economic powers. Governments have actually bought more equity than they have sold in most years since 2007, though sales far exceeded purchases in 2013. Today privatisation is once again “alive and well”, says William Megginson of the Michael Price College of Business at the University of Oklahoma. According to a global tally he recently completed, 2012 was the third-best year ever, and preliminary evidence suggests that 2013 may have been better. However, the geography of sell-offs has changed, with emerging markets now to the fore. China, for instance, has been selling minority stakes in banking, energy, engineering and broadcasting; Brazil is selling airports to help finance a $20 billion investment programme. Eleven of the 20 largest IPOs between 2005 and 2013 were sales of minority stakes by SOEs, mostly in developing countries. By contrast, state-owned assets are now “the forgotten side of the balance-sheet” in many advanced economies, says Dag Detter, managing partner of Whetstone Solutions, an adviser to governments on asset restructuring. They shouldn’t be. Governments of OECD countries still oversee vast piles of assets, from banks and utilities to buildings, land and the riches beneath (see table). Selling some of these holdings could work wonders: reduce debt, finance infrastructure, boost economic efficiency. But governments often barely grasp the value locked up in them. The picture is clearest for companies or company-like entities held by central governments. According to data compiled by the OECD and published on its website, its 34 member countries had 2,111 fully or majority-owned SOEs, with 5.9m employees, at the end of 2012. Their combined value (allowing for some but not all pension-fund liabilities) is estimated at $2.2 trillion, roughly the same size as the global hedge-fund industry. Most are in network industries such as telecoms, electricity and transport. In addition, many countries have large minority stakes in listed firms. Those in which they hold a stake of between 10% and 50% have a combined market value of $890 billion and employ 2.9m people.
The data are far from perfect. The quality of reporting varies widely, as do definitions of what counts as a state-owned company: most include only centralgovernment holdings. If all assets held at sub-national level, such as local water companies, were included, the total value could be more than $4 trillion. Reckons Hans Christiansen, an OECD economist. Moreover, his team has had to extrapolate because some QECD members, including America and Japan, provide patchy data. America is apparently so queasy about discussions of public ownership of -commercial assets that the Treasury takes no part in the OECD’s working group on the issue, even though it has vast holdings, from Amtrak and the 520,000-employee Postal Service to power generators and airports. The club’s efforts to calculate the value that SOEs add to, or subtract from, economies were abandoned after several countries, including America, refused to co-operate.
Privatisation has begun picking up again recently in the OECD for a variety of reasons. Britain’s Conservative-led coalition is fbcused on (some would say obsessed with) reducing the public debt-to-GDP ratio. Having recently sold the Royal Mail through a public offering, it is hoping to offload other assets, including its stake in URENCO, a uranium enricher, and its student-loan portfolio. From January 8th, under a new Treasury scheme, members of the public and businesses will be allowed to buy government land and buildings on the open market. A website will shortly be set up to help potential buyers see which bits of the government’s /..337 billion-worth of holdings ($527 billion at today’s rate, accounting for 40% of developable sites round Britain) might be surplus. The government, said the chief treasury secretary, Danny Alexander, “should not act as some kind of compulsive hoarder”. Japan has different reasons to revive sell-offs, such as to finance reconstruction after its devastating earthquake and tsunami in 2011. Eyes are once again turning to Japan Post, a giant postal-to-financial-services conglomerate whose oftpostponed partial sale could at last happen in 2015 and raise (Yen) 4 trillion ($40 billion) or more. Australia wants to sell financial, postal and aviation assets to offset the fall in revenues caused by the commodities slowdown. In almost all the countries of Europe, privatisation is likely “to surprise on the upside” as long as markets continue to mend, reckons Mr Megginson. Mr Christiansen expects to see three main areas of activity in coming years. First will
be the resumption of partial sell-offs in industries such as telecoms, transport and utilities. Many residual stakes in partly privatised firms could be sold down further. France, for instance, still has hefty stakes in GDF SUEZ, Renault, Thales and Orange. The government of Francois Hollande may be ideologically opposed to privatisation, but it is hoping to reduce industrial stakes to raise funds for livelier sectors, such as broadband and health.
The second area of growth should be in eastern Europe, where hundreds of large firms, including manufacturers, remain in state hands. Poland will sell down its stakes in listed firms to make up for an expected reduction in EU structural funds. And the third area is the reprivatisation of financial institutions rescued during the crisis. This process is under way: the largest privatisation in 2012 was the $18 billion offering of America’s residual stake in AIG, an insurance company.Which of the following statements is not true in the context of the given passage ?|