Al-Ahram Weekly Online   9 - 15 October 2008
Issue No. 917
Reader's corner
Published in Cairo by AL-AHRAM established in 1875

Readers' corner

Cash crisis

Sir-- The ongoing financial crisis which has forced the US government to cough up $700 billion is not an internal matter. In our globalised world it has affected the financial markets world over. Smaller economies like India have received smaller shocks (but quite painful for a small economy) as is evident from serious jolts to its share market and losses to some financial and lending institutions.

The present financial crisis is caused by the simple fact that the management of banks and other lending institutions made bad business decisions, and speculated and gambled on the basis of some one else's money.

Ultimately it is the money of the fixed deposit holders which is lent on interest to borrowers which makes banks function. The fixed deposit holders are the real beneficiary and stake holders in any bank. Therefore, these fixed deposit holders (real fund providers) should not only be the real owner and manager of banks but should also be responsible for any temptation by borrowers and risk lending which is inextricably associated with the business of money lending on interest.

Therefore, all fixed deposits in banks for, let's say, above one year should be converted into shares.

The inadequacy of financial regulators has been thoroughly exposed in this financial crisis, in avoiding NPAs (bad debts) and free flow of risky instruments (born out of risky lending) among various world lending institutions. The ongoing financial crisis should be utilised to rectify the defects of lending business. In this the US should be the leader of economic globalisation so that the world not only can be assured of a smooth financial ride in future but can also adopt globalisation with renewed vigour.

Hem Raj Jain
New Delhi

McCain's last breath

Sir-- John McCain says he will keep the troops in Iraq until we "win" and supports sending more troops to Afghanistan. Despite everything, most American voters are determined to choose this politician even though they know exactly what the Republican Party has done during the past eight years.

The whole world knows that there wasn't any cause for war against Iraq in 2003 and that it was not legal to attack and occupy it.

After returning from the Iraqi front more and more US war veterans are taking their own life. Thousands of veterans are taking sleeping pills and are using the rope and guns. Experts are already talking about a veritable "suicide epidemic" among US war homecomers.

If American voters choose McCain, they obviously share with him the idea of fighting "until the last breath for the Fatherland".

The country is in the stranglehold of unscrupulous politicians who control the military and naïve people through the effective brainwashing of the media.

Brad Fielder

Look at you

Sir-- If Arab Muslims only knew how they looked to the rest of the world they would be ashamed. The Middle East has really brought down their esteem and reputation. That's not to say that other countries haven't helped.

Shareef Muhammad

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