After 500 years of Western predominance, Niall Ferguson argues, the
world is tilting back to the East.

"We are the masters now." I wonder if President Barack Obama saw those
words in the thought bubble over the head of his Chinese counterpart,
Hu Jintao, at the G20 summit in Seoul last week. If the president was
hoping for change he could believe in—in China's currency policy, that
is—all he got was small change. Maybe Treasury Secretary Timothy
Geithner also heard "We are the masters now" as the Chinese shot down
his proposal for capping imbalances in global current accounts.
Federal Reserve Chairman Ben Bernanke got the same treatment when he
announced a new round of "quantitative easing" to try to jump start
the U.S. economy, a move described by one leading Chinese commentator
as "uncontrolled" and "irresponsible."

One of them, Cheng Siwei, explained over dinner China's plan to become
a leader in green energy technology. Between swigs of rice wine, Xia
Bin, an adviser to the People's Bank of China, outlined the need for a
thorough privatization program, "including even the Great Hall of the
People." And in faultless English, David Li of Tsinghua University
confessed his dissatisfaction with the quality of Chinese Ph.D.s.

One of them, Cheng Siwei, explained over dinner China's plan to become
a leader in green energy technology. Between swigs of rice wine, Xia
Bin, an adviser to the People's Bank of China, outlined the need for a
thorough privatization program, "including even the Great Hall of the
People." And in faultless English, David Li of Tsinghua University
confessed his dissatisfaction with the quality of Chinese Ph.D.s.

You could not ask for smarter people with whom to discuss the two most
interesting questions in economic history today: Why did the West come
to dominate not only China but the rest of the world in the five
centuries after the Forbidden City was built? And is that period of
Western dominance now finally coming to an end?

Despite the painful interruption of the Great Depression, the U.S.
suffered nothing so devastating as China's wretched mid-20th century
ordeal of revolution, civil war, Japanese invasion, more revolution,
man-made famine and yet more ("cultural") revolution. In 1968 the
average American was 33 times richer than the average Chinese, using
figures calculated on the basis of purchasing power parity (allowing
for the different costs of living in the two countries). Calculated in
current dollar terms, the differential at its peak was more like 70 to
1.

This was the ultimate global imbalance, the result of centuries of
economic and political divergence. How did it come about? And is it
over?

As I've researched my forthcoming book over the past two years, I've
concluded that the West developed six "killer applications" that "the
Rest" lacked. These were:

• Competition: Europe was politically fragmented, and within each
monarchy or republic there were multiple competing corporate entities.

• The Scientific Revolution: All the major 17th-century breakthroughs
in mathematics, astronomy, physics, chemistry and biology happened in
Western Europe.

• The rule of law and representative government: This optimal system
of social and political order emerged in the English-speaking world,
based on property rights and the representation of property owners in
elected legislatures.

• Modern medicine: All the major 19th- and 20th-century advances in
health care, including the control of tropical diseases, were made by
Western Europeans and North Americans.

• The consumer society: The Industrial Revolution took place where
there was both a supply of productivity-enhancing technologies and a
demand for more, better and cheaper goods, beginning with cotton
garments.

• The work ethic: Westerners were the first people in the world to
combine more extensive and intensive labor with higher savings rates,
permitting sustained capital accumulation.

Those six killer apps were the key to Western ascendancy. The story of
our time, which can be traced back to the reign of the Meiji Emperor
in Japan (1867-1912), is that the Rest finally began to download them.
It was far from a smooth process. The Japanese had no idea which
elements of Western culture were the crucial ones, so they ended up
copying everything, from Western clothes and hairstyles to the
practice of colonizing foreign peoples. Unfortunately, they took up
empire-building at precisely the moment when the costs of imperialism
began to exceed the benefits. Other Asian powers—notably India—wasted
decades on the erroneous premise that the socialist institutions
pioneered in the Soviet Union were superior to the market-based
institutions of the West.

Beginning in the 1950s, however, a growing band of East Asian
countries followed Japan in mimicking the West's industrial model,
beginning with textiles and steel and moving up the value chain from
there. The downloading of Western applications was now more selective.
Competition and representative government did not figure much in Asian
development, which instead focused on science, medicine, the consumer
society and the work ethic (less Protestant than Max Weber had
thought). Today Singapore is ranked third in the World Economic
Forum's assessment of competitiveness. Hong Kong is 11th, followed by
Taiwan (13th), South Korea (22nd) and China (27th). This is roughly
the order, historically, in which these countries Westernized their
economies.

Today per capita GDP in China is 19% that of the U.S., compared with
4% when economic reform began just over 30 years ago. Hong Kong, Japan
and Singapore were already there as early as 1950; Taiwan got there in
1970, and South Korea got there in 1975. According to the Conference
Board, Singapore's per capita GDP is now 21% higher than that of the
U.S., Hong Kong's is about the same, Japan's and Taiwan's are about
25% lower, and South Korea's 36% lower. Only a foolhardy man would bet
against China's following the same trajectory in the decades ahead.

China's has been the biggest and fastest of all the industrialization
revolutions. In the space of 26 years, China's GDP grew by a factor of
10. It took the U.K. 70 years after 1830 to grow by a factor of four.
According to the International Monetary Fund, China's share of global
GDP (measured in current prices) will pass the 10% mark in 2013.
Goldman Sachs continues to forecast that China will overtake the U.S.
in terms of GDP in 2027, just as it recently overtook Japan.

But in some ways the Asian century has already arrived. China is on
the brink of surpassing the American share of global manufacturing,
having overtaken Germany and Japan in the past 10 years. China's
biggest city, Shanghai, already sits atop the ranks of the world's
megacities, with Mumbai right behind; no American city comes close.

Nothing is more certain to accelerate the shift of global economic
power from West to East than the looming U.S. fiscal crisis. With a
debt-to-revenue ratio of 312%, Greece is in dire straits already. But
the debt-to-revenue ratio of the U.S. is 358%, according to Morgan
Stanley. The Congressional Budget Office estimates that interest
payments on the federal debt will rise from 9% of federal tax revenues
to 20% in 2020, 36% in 2030 and 58% in 2040. Only America's
"exorbitant privilege" of being able to print the world's premier
reserve currency gives it breathing space. Yet this very privilege is
under mounting attack from the Chinese government.

For many commentators, the resumption of quantitative easing by the
Federal Reserve has appeared to spark a currency war between the U.S.
and China. If the "Chinese don't take actions" to end the manipulation
of their currency, President Obama declared in New York in September,
"we have other means of protecting U.S. interests." The Chinese
premier Wen Jiabao was quick to respond: "Do not work to pressure us
on the renminbi rate…. Many of our exporting companies would have to
close down, migrant workers would have to return to their villages. If
China saw social and economic turbulence, then it would be a disaster
for the world."

Such exchanges are a form of pi ying xi, China's traditional shadow
puppet theater. In reality, today's currency war is between
"Chimerica"—as I've called the united economies of China and
America—and the rest of the world. If the U.S. prints money while
China effectively still pegs its currency to the dollar, both parties
benefit. The losers are countries like Indonesia and Brazil, whose
real trade-weighted exchange rates have appreciated since January 2008
by 18% and 17%, respectively.

But who now gains more from this partnership? With China's output
currently 20% above its pre-crisis level and that of the U.S. still 2%
below, the answer seems clear. American policy-makers may utter the
mantra that "they need us as much as we need them" and refer ominously
to Lawrence Summers's famous phrase about "mutually assured financial
destruction." But the Chinese already have a plan to reduce their
dependence on dollar reserve accumulation and subsidized exports. It
is a strategy not so much for world domination on the model of Western
imperialism as for reestablishing China as the Middle Kingdom—the
dominant tributary state in the Asia-Pacific region.

If I had to summarize China's new grand strategy, I would do it,
Chinese-style, as the Four "Mores": Consume more, import more, invest
abroad more and innovate more. In each case, a change of economic
strategy pays a handsome geopolitical dividend.

By consuming more, China can reduce its trade surplus and, in the
process, endear itself to its major trading partners, especially the
other emerging markets. China recently overtook the U.S. as the
world's biggest automobile market (14 million sales a year, compared
to 11 million), and its demand is projected to rise tenfold in the
years ahead.

By 2035, according to the International Energy Agency, China will be
using a fifth of all global energy, a 75% increase since 2008. It
accounted for about 46% of global coal consumption in 2009, the World
Coal Institute estimates, and consumes a similar share of the world's
aluminum, copper, nickel and zinc production. Last year China used
twice as much crude steel as the European Union, United States and
Japan combined.

Such figures translate into major gains for the exporters of these and
other commodities. China is already Australia's biggest export market,
accounting for 22% of Australian exports in 2009. It buys 12% of
Brazil's exports and 10% of South Africa's. It has also become a big
purchaser of high-end manufactured goods from Japan and Germany. Once
China was mainly an exporter of low-price manufactures. Now that it
accounts for fully a fifth of global growth, it has become the most
dynamic new market for other people's stuff. And that wins friends.

The Chinese are justifiably nervous, however, about the vagaries of
world commodity prices. How could they feel otherwise after the huge
price swings of the past few years? So it makes sense for them to
invest abroad more. In January 2010 alone, the Chinese made direct
investments worth a total of $2.4 billion in 420 overseas enterprises
in 75 countries and regions. The overwhelming majority of these were
in Asia and Africa. The biggest sectors were mining, transportation
and petrochemicals. Across Africa, the Chinese mode of operation is
now well established. Typical deals exchange highway and other
infrastructure investments for long leases of mines or agricultural
land, with no questions asked about human rights abuses or political
corruption.

Growing overseas investment in natural resources not only makes sense
as a diversification strategy to reduce China's exposure to the risk
of dollar depreciation. It also allows China to increase its financial
power, not least through its vast and influential sovereign wealth
fund. And it justifies ambitious plans for naval expansion. In the
words of Rear Admiral Zhang Huachen, deputy commander of the East Sea
Fleet: "With the expansion of the country's economic interests, the
navy wants to better protect the country's transportation routes and
the safety of our major sea-lanes." The South China Sea has already
been declared a "core national interest," and deep-water ports are
projected in Pakistan, Burma and Sri Lanka.

Finally, and contrary to the view that China is condemned to remain an
assembly line for products "designed in California," the country is
innovating more, aiming to become, for example, the world's leading
manufacturer of wind turbines and photovoltaic panels. In 2007 China
overtook Germany in terms of new patent applications. This is part of
a wider story of Eastern ascendancy. In 2008, for the first time, the
number of patent applications from China, India, Japan and South Korea
exceeded those from the West.

The dilemma posed to the "departing" power by the "arriving" power is
always agonizing. The cost of resisting Germany's rise was heavy
indeed for Britain; it was much easier to slide quietly into the role
of junior partner to the U.S. Should America seek to contain China or
to accommodate it? Opinion polls suggest that ordinary Americans are
no more certain how to respond than the president. In a recent survey
by the Pew Research Center, 49% of respondents said they did not
expect China to "overtake the U.S. as the world's main superpower,"
but 46% took the opposite view.

Coming to terms with a new global order was hard enough after the
collapse of the Soviet Union, which went to the heads of many Western
commentators. (Who now remembers talk of American hyperpuissance
without a wince?) But the Cold War lasted little more than four
decades, and the Soviet Union never came close to overtaking the U.S.
economically. What we are living through now is the end of 500 years
of Western predominance. This time the Eastern challenger is for real,
both economically and geopolitically.

The gentlemen in Beijing may not be the masters just yet. But one
thing is certain: They are no longer the apprentices.
—Niall Ferguson is a professor of history at Harvard University and a
professor of business administration at the Harvard Business School.
His next book, "Civilization: The West and the Rest," will be
published in March.

Conclusions

Outstanding Scholarship.

Sudan's ruling northern party warned on Sunday it may not recognise
the result of a January 9 southern referendum on independence if
problems with registering voters were not resolved.

However, the northern National Congress Party (NCP) said low
registration of southerners living in the north would affect the
credibility of any outcome. The NCP blamed the southern ruling party,
the Sudan People's Liberation Movement (SPLM), for telling southerners
in the north not to register.

"The SPLM is using tools to pressure and threaten and terrorise people
not to register and this means ... that the whole referendum will not
be free and fair and transparent," senior NCP official Rabie Abdelati
told Reuters.

"If this behaviour continues by the SPLM ... this will not lead to an
atmosphere conducive to holding the referendum and ... the results
will be affected," he said. "This will ultimately lead to non
recognition not only by the Sudan government but by the whole
international community."

Two SPLM officials, who declined to be named, confirmed to Reuters
that it had told southerners in the north not to register, saying they
feared the NCP could manipulate results there. However, the SPLM
publicly denied this was official party policy, instead accusing the
NCP of intimidating southerners.

The referendum commission has estimated that around 5.5 million
southerners may be eligible to vote, including 500,000 in the north
and another half a million abroad.

More than 60 percent of southerners who register must turn out to vote
for the result to be valid

Conclusions

South Sudan referendum complicated by oil revenue CS Monitor
http://bit.ly/cgNYiJ

I have visited Juba twice this year. The second time President Omar
Bashir – a man on the most wanted list of the International Criminal
Court in The Hague – was in town for the celebration of the
Comprehensive Peace Agreement and I was quick enough on the draw to
take this picture.

#Juba Airport Yesterday #Sudan President Omar Bashir's Plane Aly-Khan
www.rich.co.ke #Africa Twitpic
http://www.twitpic.com/yxw6z

President Bashir made a speech in Juba where he said that if the South
elected for independence this January, during the South’s planned
referendum, he would be the first to congratulate President Salva
Kiir. It was hardly reported anywhere but I heard him loud and clear.
I remember turning to my companions, all of whom were in the
government of Southern Sudan. They were unimpressed.

“Aly-Khan, we are Bashir's back garden,” one of my companions said.
“We have most of the wealth.” They certainly have most of the oil, an
estimated 80 percent of proven reserves, and they are taking a haircut
on their share in the current 50-50 split of oil revenues. “Now how
does someone agree to just letting their back garden go?”

Euro 1.3756
Pound 1.6011
Yen 83.39
Aussie 0.9919 - Up a Big Figure since last week
Rand 6.9550 - Unruffled by last weeks Rate Cut and a Buy above 7.00
India Rupee 45.25
Brazil Real 1.7149

“It is as unrelentingly dollar-negative as any major central bank
speech has been in recent years,” said strategists at Citigroup.

The People’s Bank of China announced Friday that it would raise the
reserve requirement ratio for banks by half a percentage point

Conclusions

Bernanke gave Everyone the Green Light to sell the Dollar.

Euro Dollar 1 week chart INO 1.3760 Last
http://bit.ly/deyPwl

Facebook’s putting up some big numbers in terms of U.S. web traffic.
Right now, the site accounts for one out of every four pageviews in
the United States — that’s 10% of all Internet visits.According to
data from analysis and intelligence firm Hitwise, Facebook’s
(Facebook) year-over-year growth has been phenomenal. We reported in
June that the social network was set to eclipse Google in web traffic;
now, Hitwise is showing that in the past week, Facebook.com saw 3%
more web visits and almost five times more pageviews than Google
(Google).com.By these metrics, Facebook is by far the single most
popular website in the United States. Still, other sources with other
measurements and criteria show some variance.comScore has also
released stats showing huge growth from Facebook — a 55%
year-over-year increase, in fact. But comScore places Facebook at
151.13 million U.S. uniques for October 2010, slightly behind Google’s
173.3 monthly uniques, which means the search giant is the social
network’s sole competitor for web traffic domination.The company has
been growing at a breakneck pace all year. It announced that its
network had reached the extraordinary milestone of 500 million members
in July. And at Web. 2.0 Summit this week, CEO Mark Zuckerberg told
the audience that half of those members visit Facebook on a daily
basis.

The Down Draft is over.

Cocoa -2.46%
Coffee +0.48%
Cotton -1.3%
Sugar -7.71% has become stupendously Volatile.

Sugar March 2011 3 Month Chart INO
http://bit.ly/cQm8kX

Last Price    26.15
Open    28.35
High    29.30
Volume    65,065
Expiration    2011-02-28
Low    25.98
Open Int.    235986
Contract High    33.39 Contract High Date    2010-11-11

Conclusions

The Very Definition of ^VIX.

It’s one thing to buy a large white truffle — this year’s top prize at
the 12th World White Truffle of Alba Auction was a 900-gram truffle
that sold for 105,000 euros (US$142,653) on Nov. 16 to Jeannie Cho
Lee, a Hong Kong-based wine expert.

Cooking it is another thing.

And this Sunday, that responsibility will fall to Umberto Bombana,
chef and owner of 8½ Otto e Mezzo Bombana in Hong Kong. The chef
assures Scene: He isn’t nervous.

This isn’t the largest truffle Mr. Bombana has ever worked with. In
2006, when he was executive chef at Toscana in Hong Kong’s old
Ritz-Carlton, Mr. Bombana was entrusted with a 1.5-kilogram truffle
purchased by property tycoon Gordon Wu.

Unlike fine wines, which can be stored and aged, a truffle must be
consumed while it is fresh — one week is considered the maximum shelf
life.

As such, there’s pressure to quickly arrange the 900-gram truffle
dinner, set for Nov. 21 at Mr. Bombana’s restaurant. There, 25 to 30
guests will consume every last bit of the fungus, which is nearly the
size of a soccer ball. “I may have to add even more truffles if we run
out,” says the chef.

How do you prepare a meal worthy of a $142,653 truffle? Compared with
black truffles, the white variety of this fungus has an especially
delicate texture; it doesn’t stand up to much cooking at all and is
usually served freshly shaved on a dish. So Mr. Bombana will spend
most of his time preparing dishes to accompany the truffle, rather
than cooking with the truffle itself.

The chef has chosen a classic menu for the eight-course dinner: a
porcini risotto, an egg ravioli with ricotta cheese and spinach in
hazelnut butter, and a roasted veal tenderloin with braised savoy
cabbage, Iberico ham and truffle mash potatoes, for example. All will
be topped with generous shavings of white truffle. The most inventive
truffle dish comes at the end: a dessert of mascarpone and ice cream
infused with the last remaining scraps of truffle, with honey and
chestnut nougat.

“Lighter meats — like veal — and pastas will not overpower the flavor
of the truffle,” says Mr. Umberto. No one but the chef will handle the
white truffle, due to its immense value. “The most difficult part is
cleaning it well, and carefully brushing away the sand,” he says.

Another important step — and one of the perks of the job, he adds — is
the taste test. “For sure, I will also have to try the truffles in all
my dishes,” he says.

What does that make Shashi Ruia?

In the sidelines of the Hindustan Times Leadership Summit on Friday, a
gaggle of reporters was asking the chairman of Essar Group to
elaborate on the pitch he had just delivered on the benefits of
globalization.

Mr. Ruia cited the example of the Tata Group’s decision to buy Jaguar
as a smart globalization move–and then added, with a chuckle, that he
had a personal reason for supporting the acquisition.

“I love Jaguars,” Mr. Ruia said, beaming outside the basement
conference room in New Delhi’s Taj Palace Hotel.

He went on to confess to having nine different models of the British
super luxury automobile, including one from 1946.

“I am a big admirer of Ratan Tata’s,” he said. “I hope he’ll give me
one for free,” he added, with a grin.

Not that the gazillionaire chairman of the oil-to-outsourcing
conglomerate is in need of any freebies, of course.

The founder of Bharti Airtel, India's top mobile operator, said on
Friday the priority for its new loss-making African business was
long-term growth rather than turning a quick profit on the
continent.Bharti acquired the African telecoms assets of Kuwaiti group
Zain in a $9 billion deal in June, giving it access to what it says is
the "biggest future continent" for telecoms and making it the world's
fifth-biggest mobile operator.

The group said last week its second-quarter net profit fell 27
percent, dragged down partly by the new African business, though it
said it had "arrested" a falling revenue trend.It has declined to say
when it would turn around its five-month-old African operations.

"You can choose to be very profitable very quickly if you don't want
to grow," Bharti's billionaire chairman, Sunil Mittal, told Reuters in
an interview in Nigeria, where the firm is launching the rebranding of
Zain across Africa.

"Investors will tell you they want growth rather than good
profitability. We're here for the long haul," he said.

Bharti, 32-percent owned by Singapore-based SingTel, Southeast Asia's
top phone company, has cut prices in 10 of 16 African countries in
which it operates to boost usage in a market where less than a third
of the population have mobiles.

A price war in its Indian home market last year hit earnings, and
Mittal said Bharti did not want a similar battle in Africa.

"We believe in affordable tariffs. We will bring our business model,
which is low cost, low tariffs, wide networks into Africa, and
particularly Nigeria, but we are not here for a price war," he said.

"The good news is prices are already getting rebalanced, competition
is fierce, and the customers are benefiting."

Mittal, who started out selling bicycle parts, saw an opportunity in
telecoms in the mid-1990s as India opened up to the private sector.
Bharti began with a licence to operate a mobile network in Delhi.

Nigeria, Africa's most populous nation, with more than 140 million
people, is seen by investors as one of the world's leading scalable
frontier markets. It has already overtaken South Africa as the
continent's biggest mobile market.

Mittal said the biggest challenges in Nigeria included infrastructure
and electricity -- the country is hit by frequent power outages -- and
urged the Nigerian government to reduce taxes to promote further
investment in the sector.

"The government must encourage investment into rural areas, for a
telecom network for societies that are out of digital (reach)," he
said.

"My request would be that the government really lowers the tax for
this industry."

Adding 1 m subscribers every month in Africa: Bharti Airtel Manoj
Kohli MoneyControl
http://bit.ly/cv4eaR

Kohli said the operations of Zain actually declining for last 18months
or so. “Revenues, profit, EBITDA, market share was declining and my
first job there, was to get the decline to be over so that we can
revive it and start a growth trend and that I think we have done
within the first three months.” Since the last month, he said here has
been very good growth. “Minutes are growing, MoU (Minutes of Usage)
per customer are growing, revenues are growing and I feel customer
satisfaction is growing and today is the brand launch in Africa. You
will see a very remarkable change in this market.”

A: We are going through a restructure period which can take a couple
of quarters. There a around 6 – 7 big restructurings that we are doing
in Africa. Our network is being fully restructured.

Q: What is the current status of subscribers? Can you share with us
the latest subscriber numbers?

A: We have more than 40 million active customers. We are adding more
than a million active customers a month.

Q: So when you say active subscribers are you also hinting at the fact
that you probably shed some subscribers across the geographies that
you are operating in?

A: When we took over we had shed about 6 million from 42 million to 36 million.

Visiting Chinese Vice President Xi Jinping said here on Friday that
China regards Angola as a strategic partner for cooperation and
enhancing comprehensive cooperation fits the fundamental and long-term
benefit of the peoples of the two countries.Xi made the remarks when
meeting with Angolan President Jose Eduardo dos Santos.Since 2006,
Angola has become China's biggest trade partner in Africa for four
years in a row and Angola has also become China's second crude oil
provider across the world.

Conclusions

Angola has become China's biggest trade partner in Africa for four
years in a row and Angola has also become China's second crude oil
provider across the world

Value7,003.20   
Change53.510    
% Change0.770

Conclusions

Headed considerably higher over the Medium Term.

Value31,398.82   
Change-175.180    
% Change-0.555

Conclusions

5.416% off its All Time High from 2008

Dollar Rand Live ForexPros 6.961 Last
http://bit.ly/7U2d3X

Value6,825.41   
Change81.500    
% Change1.208

Value24,959.95   
Change-224.180    
% Change-0.890

The remaining half of Orascom Telecom's Tunisian operation has been
sold to a consortium involving Qatar Telecom's Kuwaiti unit Wataniya
for $1.2 billion, the Qatari fixed line and wireless carrier said on
Monday.Wataniya, which had already owned 50 percent of Tunisiana,
bought the remaining stake from Orascom in a consortium led by
Princesse Holding of Tunisia, Qtel said in a statement.

"The acquisition is in line with the Qtel Group's vision ... and with
our strategy of active portfolio development, through which we may
seek to increase our ownership in well performing assets, with further
growth potential," Qtel's Chairman Sheikh Abdullah al-Thani said in
the statement.

"Mine Recruition"

Ernest Cole took this picture of gold-mine recruits, who had been
lined up in a grimy room for a group examination, after sneaking his
camera into the mine inside his lunch bag.

Kenya’s sovereign rating was raised by Standard & Poor’s, placing it
on par with Ukraine, Georgia and Paraguay, because of reduced
political risk as it enacted a new constitution and the economic
outlook improved.

The rating, increased by one step to B+, is four levels below
investment grade, the New York-based agency said in a statement today.
The outlook for the rating is stable.

“The stable outlook reflects our expectation that the ruling coalition
will continue working together on political and macroeconomic issues,
and that political instability will not significantly hinder our
projections of economic growth,” the agency said.

Kenya’s $34.5 billion economy is East Africa’s biggest, according to
the World Bank. In August, the country made law a new constitution
that was the product of a power-sharing accord signed by President
Mwai Kibaki and Prime Minister Raila Odinga in 2009. That agreement
followed two months of violence, triggered by a disputed presidential
election, in which 1,500 people died and 300,000 were forced to flee
their homes.

The constitution aims to share political power among the country’s 42
ethnic groups, achieve more equitable land distribution and put checks
and balances on the president, aiming to avoid a repeat of the
post-election violence.

The charter “reduces political risks because it provides significantly
more clarity on the demarcation of power between the president,
parliament and other pillars of government,” S&P said today. “The
absence of violence surrounding the referendum supports our view of
improving political stability in Kenya.”

Kenya’s rating remains constrained by its “low level of economic
development, underlying ethnic tensions and relatively high fiscal
deficit levels,” the agency said.

Kenya’s gross domestic product per capita is $464, compared with the
sub-Saharan African average of $623, according to World Bank data.
Economic growth in the nation of 38.6 million people is forecast to
accelerate to 4 percent next year from 2.3 percent this year,
according to International Monetary Fund data. S&P expects the economy
to expand 5.4 percent, it said.

Fiscal debt levels are “comparatively high, but we expect the general
government debt burden to remain steady” at about 51 percent of GDP
until 2013, it said.

The government plans to cut domestic borrowing next year by about 10
percent to 95 billion shillings ($1.2 billion), the Finance Ministry
said last month.

Calls made to the main office of Kenya’s Finance Ministry in Nairobi
seeking comment after normal business hours weren’t answered.

Conclusions

Bullish.

Value84.53   
Change0.200    
% Change0.237

84.97 is the 2010 High

Conclusions

In a Bullish Channel as it has been all Year.

Conclusions

Half a Yard IMF Package and S&P Upgrade refers.

Targets 78.00.

The East African Rift Valley system is estimated to hold the potential
of produce 7,000MW of electricity, with Kenya accounting for 1,200 MW,
which is equivalent to the power the country produces annually.

Barclays Bank of Kenya posted a 6 percent rise in nine-month pretax
profit, helped by new products and increased risk management.

"During the quarter we maintained a positive outlook and strengthened
the business with the introduction of new products and offerings for
consumer and corporate customers," Managing Director Adan Mohamed said
on Friday.

Majority owned by British lender Barclays (BARC.L: Quote), the bank
said pretax profit rose 6 percent to 7.01 billion shillings ($87
million), while assets grew 5 percent to 177 billion.Total income
increased 14 percent to 19.7 billion shillings, while non-interest
income rose by a quarter to 8 billion. Loans and advances to customers
fell 5 percent to 91.68 billion shillings. Earnings per share rose 18
percent to 4 shillings.

"Modest growth was expected. By the time we get to the year-end we
expect they'll post quite a good margin above last year's results," an
analyst at one investment bank said on condition of anonymity.

Provisions for loan impairments more than doubled to 1.2 billion
shillings as more consumer loans matured, the bank said. Its net
non-performing loans ratio fell from 8.5 to 6.9 percent.

"Strong risk management to maintain excellent quality in the lending
book remains our key focus as we continue to book new loans. Our loan
portfolio continued to demonstrate good quality with a steady decline
in non-performing loans," Adan said.

"Key activities included revamping our mortgage product, strengthening
our SME (small and medium enterprises) proposition and introducing
linkages to M-Pesa services."

Barclays Bank 3rd Quarter Results share price data www.rich.co.ke
http://bit.ly/3FrB3X

Par Value:                  2/-
Closing Price:          63.00
Total Shares Issued:          1,357,884,032
Market Capitalization:        85,547M
EPS:            4.50
PE:                14.000

Investment banks and stockbrokers will earn Sh300 million from the
upcoming Kenya Power and Lighting Company rights issue, which has been
priced at a hefty discount to ensure all investors take up their
allocation.The rights — new shares sold to investors as per their
current holding in the company — will be sold at Sh19.50 per stock, a
30 per cent discount on the average market price for the six months
ending November 10.

Half of the issue is being underwritten for comfort because the
government, which is the biggest single shareholder with a 40 per cent
stake, has forfeited its allocation in favour of interested private
investors. “KPLC will enter into underwriting arrangements with Equity
Bank and Centum Investment Company for 50 per cent of the rights under
the rights issue offer to ensure its success,” said Mr Njoroge.

After factoring in the share split, which was finalised on Friday, the
fair price of the stock would be about Sh22, effectively discounting
the offer price.

“At Sh19.50, the right is fairly priced since it affords the
shareholder an opportunity to maintain their stake in the company at a
discount,” said Mr Wachira.

KPLC share Price Data and Material Announcements here
http://bit.ly/BLiwX

The British government owned investment firm, Commonwealth Development
Corporation (CDC), will set up a new private equity fund in Kenya in
the next few weeks to channel a new wave of direct investments in East
Africa.

“The new private equity (PE) fund targeting general investments will
be up and running in the next few weeks. It will focus directly on
opportunities in Kenya, Uganda, and Tanzania,” said Richard Laing, CDC
chief executive.

He added that CDC was yet to decide on the initial amount, but hinted
it would be million of US dollars. Mr Laing said the firm also plans
to make direct investments in the consumer goods sector.

This marks a shift in strategy in the firm’s investments model that
has been defined by channelling funds through PEs with knowledge of
the local market. The firm, whose current portfolio in Kenya stands at
about Sh7.4 billion, has been investing through fund managers Actis,
Aureos, ECP, Grofin, Helios, and Business Partners International. The
move to make direct investments in future deals means that CDC will be
competing with PE firms.

“The obvious first partners will be the fund managers, who have a good
set of transactions. If they come across a transaction that may be too
big for them and they desire more capital, we will invest alongside
them. Over time, we will build up a subset of partners with whom we
would like to make direct investments,” he said.

The new strategy, to be implemented in Sub-Saharan Africa and Southern
Asia, was approved by the British government years ago. Earlier this
year, Mr Andrew Mitchell, the British government’s International
Development secretary, started to push for a shift for CDC to focus
from investing in countries that can easily access private capital and
focus more on investing directly in unattractive developing markets.

Britain is planning to commit half of all new investments to
Sub-Saharan Africa in the next four years. Valued at over £2 billion,
CDC is one of the biggest investors in emerging market private equity
funds. Last year, it invested £359 million and £220 million in African
and Asian businesses.

Mr Laing noted CDC investments in Kenya are low and said the firm will
go big in energy, property and consumer goods — its main areas of
focus.

“What is interesting in Kenya is that people have more money to spend
now than ever before. Anybody providing the kind of goods consumers
want will do well,” said Mr Laing.

CDC has stakes in Nairobi Business Park, the property complex at the
Junction, Ngong Road; and two energy projects in Ol Kalou and Rabai.
Other firms include Athi River Steel Plant, Brookside Dairy, Wananchi
Group, Tsavo Power Company and Equity Bank.

This has intensified activity by PE firms, as seen by AfricInvest’
injection of Sh1 billion Family Bank and the International Finance
Corporation’s Sh2 billion in Diamond Trust Bank. Both banks are
SME-focused. Catalyst Principal Partners is another new PE firm
seeking to invest between $5million and $15million in SMEs in the
region.

Conclusions

They were very Good Dinner Company.

Prince William proposed to Kate Middleton in a secluded log cabin in
the middle of an African national park, it was revealed today.

They spent a “wonderful 24 hours” at the hideaway, part of the Rutundu
Log Cabins complex in Kenya, overnight on October 20 — the first
confirmation of the precise date of the prince's proposal.

And the couple revealed their joy at the visit by leaving messages in
the guest book, noting how they went fishing in a nearby lake and
spent a romantic yet chilly evening in front of an open fire, with the
spartan hut lit by candles.

According to The Sun, William wrote: “Such fun to be back! Brought
more warm clothes this time! Looked after so well, thank you guys!
Look forward to next time, soon I hope.”

Miss Middleton added: “Thank you for such a wonderful 24 hours! Sadly
no fish to be found but we had great fun trying. I love the warm fires
and candlelights — so romantic! Hope to be back again soon. Catherine
Middleton.”

It was here that William removed his mother's sapphire and diamond
engagement ring from his rucksack and slipped it on the finger of his
fiancée — reportedly on the verandah.

William is understood to have visited the cabins several times in the
last two years.

Located in the shadow of Mount Kenya, they have no electricity and the
four-poster bed in their cabin was made out of tree trunks. Elephants,
lions, leopards, buffaloes and hyenas roam nearby.

The couple had arrived at the cabin by helicopter. It is near the Lewa
Downs wildlife reserve, owned by the parents of an old girlfriend,
Jecca Craig. They were looked after by a safari guide, a cabin
attendant and a chef. A royal insider said: “There are only two cabins
which can lodge a maximum of eight, and you can't go up there unless
you are expected.

“It is his own private bolt-hole and will remain so as it is totally
inaccessible when he wants it to be. What better place could he find
to propose?”

The NSE20 dipped 3.16 points to close at 4577.17.
The NASI was down 0.02 points at 100.71.
Market Cap was 1.201409 Trillion versus 1.201724 Trillion last time.
Equity Turnover was 363.206m versus 645.412m.
The Bourse is up about 45% for 2010 and has flat lined since the
Referendum Vote. The Standard and Poors Upgrade to B+ And what I think
will be faster GDP Growth for the Full Year than Consensus [Consensus
is at 5%] will keep the Bull Channel intact as it has been all Year.
EABL was unable to close at a 6th Consecutive All Time High but stayed
at a Record and Safaricom improved to close at 4.55 and both were the
outsize Trades at the Bourse.

Sasini Tea closed at 13.50 and traded 72,700 shares.
Rea Vipingo traded 2,100 shares and was unchanged at 16.55.
Kakuzi traded 10,100 shares and closed at 82.50.

SAFARICOM

shares volume     15,621,200
total turnover     71,653,968
avg price     4.59 Closing Price 4.55 +1.11%
high price     4.60
low price     4.50
last price     4.55

Conclusions

Safaricom was the most active share at the Nairobi Bourse and firmed
1.11% to close at 4.55 versus a 4.59 weighted Average. Safaricom
trades on a Trailing PE of 11.842 and the Price looks oversold. The
Noise from Airtel's Entry crimped the Price but its quite overdone at
these Levels.

Safaricom share price data www.rich.co.ke
http://bit.ly/4cdZRM

Par Value:                  0.05/-
Closing Price:          4.50
Total Shares Issued:          40,000,000,000
Market Capitalization:        180,000M
EPS:            0.38
PE:                11.842

TPS Serena traded 3rd at the Bourse. TPS Serena was unchanged at 68.00
and traded a 66.00-69.00 range and 408,800 shares worth 27.855m. TPS
Serena has posted a 108.755% 1 Year Return and is the Only Proxy for
playing the Tourism Sector.

TPS Serena share price data www.rich.co.ke
http://bit.ly/5Ve4gj

Kenya Airways rallied 2.28% to close at 44.75 and traded 254,400
shares. There was a 3-1 Demand versus Supply Imbalance and Kenya
Airways reported 1st Half results some 65%+ ahead of last time. The
Forward Implied PE is just over 7.00 and Buyers bought Big Lines just
a little below at 42.00+.

Kenya Airways share price data and 1st Half Results www.rich.co.ke
http://bit.ly/1AaBD1

CMC Holdings rallied 1.5% to close at 13.45 and traded 1.114m shares.
Thats good Volume for the Stock.
CarGen did not trade.

Access Kenya fell 5.471% to close at 15.55 a new 12 Month Low. Access
Kenya traded just 20,100 shares. Access Kenya has retreated 27.262%
over the last 12 months and Bucked the positive Trend at the Nairobi
stock Exchange which is up 45% over that period.

Nation was unchanged at 167.00 and traded 4,900 shares.
Standard traded 1,900 shares and closed at 45.50.

ScanGroup closed 2.4% lower at 61.00 and traded 16,400 shares.

Equity Bank was the 4th most active Counter at the Nairobi Bourse.
Equity Bank was unchanged at 26.25 and traded a 26.00-26.50 range and
1.060m shares worth 27.862m. Equity Bank with its Initiatives with
Safaricom and Orange has positioned itself as the Preeminent Player in
the Space where Telcos and Banks are intersecting. The 27 Month
Closing high is 27.00 and we sit just below that level.
COOP Bank eased 0.25% to close at 19.90 and traded a 19.85-20.00 range
and 1.080m shares worth 21.506m. There were over 2m shares for Sale
today and a 2-1 Supply versus Demand Imbalance.
KCB eased 1.14% to close at 21.75 and traded a 21.75-22.50 range and
354,400 shares. The Lighter Volume confirms a Lack of Supply at these
Price Points and an eventual Move Higher.
Barclays Bank bounced 0.79% to close at 63.50 and traded a 63.00-65.00
range and 73,900 shares. Barclays reported a +6.00% 9 Month Profit and
trades on a Trailing PE of about 14.00 which looks inexpensive
especially when You look at the 3rd Quarter EPS Expansion.
StanChart closed a shilling easier at 273.00 and traded 1,700 shares.

Diamond Trust traded 5th at the Bourse. DTB firmed 0.75% to close at
134.00 and traded a 134.00-135.00 range and 193,000 shares worth
26.053m. DTB has an Implied Forward PE of around 10 extrapolating from
the 3rd Quarter Results on a Straight line Basis.

Diamond Trust Bank share price data 3rd Quarter Results here www.rich.co.ke
http://bit.ly/4A8Khs

NIC traded 156,100 shares and all at 48.00 and unchanged.
CFC StanBic was marked down 5.88% to close at 80.00 and traded 10,900 shares.
HFCK eased 1.86% to close at 26.25 and traded 69,200 shares.
NBK eased 0.65% to close at 38.50 and traded 55,000 shares.

Centum closed 1.1% easier at 22.50 and traded 79,900 shares.

Kenya Re closed 5 cents easier at 11.40 and traded an 11.20-11.90
range and 463,900 shares worth 5.295m.
Jubilee traded a 1,000 shares and closed at 196.00.
PanAfric did not trade.

Olympia Capital closed at 6.65.

EABL traded 2nd by only a whisker. EABL was unchanged at 225.00 an All
Time Closing High but was unable to make it a 6th Consecutive Record
Close today. EABL traded a 222.00-226.00 range and 315,800 shares
worth 71.335. A New Record was missed by 0.05 as the weighted average
Price was 225.95 which is rounded down to 225.00. The Serengeti Move
in Tanzania coupled with Muscular 'Africa' Results from SABMiller has
kept Foreign Investors in particular in 'Hot Pursuit' of the stock.

EABL share price data www.rich.co.ke
http://bit.ly/57wrgL

KenGen traded 6th. KenGen improved 0.566% to close at 17.75 and traded
1.317m shares.
KPLC split its shares today 8-1 ahead of its Rights Issue. KPLC closed
at 28.00 and traded a 27.00-30.00 range and 47,700 shares only. 28.00
equates to 224.00 and hence KPLC was effectively unchanged on the Day.
The Underwriting of 50% of the Rights Issue by a Consortium that
includes Equity Bank and Centum is a strong statement and supportive
of the Rights Issue, which I thought hardly steeply discounted.
Cables closed lower at 17.65 and traded 4,600 shares.

Mumias Sugar finally arrested its Slide to close 5 cents firmer at
9.75 and traded 557,800 shares.

BAT eased a shilling to close at 287.00 and traded 50,800 shares. BAT
is set to pay an Interim Dividend and is the highest Paying Dividend
Stock at the Bourse.

Bamburi Cement was unchanged at 196.00 and traded 30,500 shares.
Athi River Mining retreated 3 shillings to close at 172.00 and traded
only 300 shares.
Portland firmed 3 to close at 108.00 on 3,000 shares.

KenolKobil closed at 10.35 and traded 119,700 shares.
Total traded 15,400 shares and was unchanged at 29.25.

Sameer Africa bounced 10 cents after its 20%+ Sell Off last week post
its Profits Warning. Sameer closed at 6.50 and traded 62,100 shares.

BOC Kenya was unchanged at 140.00 with 2,000 shares traded.
Carbacid did not trade.
Crown Berger traded 100 shares and was unchanged at 35.00.
Eveready slipped a further 5 cents to close at 3.05 with 7,600 shares traded.
Unga traded 2,100 shares and closed at 11.75