Tonight’s TV, get Rosenberg for free, and low default emerging market loans

There are a couple of interesting things on TV this evening, both on More4.  At 10pm it’s True Stories: The Shock Doctrine, a film based on Naomi Klein’s book which looks at the way far right economists have used disasters around the world to impose extreme free market “solutions” (Milton Friedman and the Chicago School of Economics) on society.  After this at 11.45pm it’s Enron: The Smartest Guys In The Room about the 2001 fraud at the US energy giant.  On the same theme, (and you’ll only get tickets on eBay now), Enron, the play by Lucy Prebble has had fantastic reviews, and opens in London at the Royal Court Theatre on 17th September.  Tickets are still available however for David Hare’s new play, The Power of Yes at the National Theatre, a quickly written piece about the collapse of the banks, and how only the rich were bailed out.

Changing topics, you may remember that one of our favourite economists over the course of the past decade was David Rosenberg, who headed up Merrill Lynch’s US economics team.  He called the deflation wave very well and, like Robert Peston, had a “good war” as the credit crisis developed.  David has since left Merrill to head back to his native Canada where he’s Chief Economist at Gluskin Sheff; but the good news is that you can now sign up for his excellent daily emailed views on the US economy for free, here.

Finally, I present to you an emerging markets investment opportunity.  You can make loans to sub-investment grade issuers in low income economies, and the average default rate experienced so far is below 2%, compared with around 10% currently for US high yield companies.  The default rate I’ve experienced so far is even better, at 0%, although I’m starting to sweat on a $25 loan I made to an Azerbaijan farmers cooperative.  The catch of course is that this is micro-finance lending through, a US not for profit organisation, and the interest rate is zero (the yield on the emerging market government bond index is about 9% at the moment).  Have a look at the website – you can choose entrepreneurs from all over the world, in many different industries, and lend as little as $25 each time.

The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. Past performance is not a guide to future performance.

Jim Leaviss

Job Title: CIO Public Fixed Income

Specialist Subjects: Macro economics and fixed interest asset allocation

Likes: Cycling, factory records, dim sum

Heroes: Brian Clough, Morrissey, Neil Armstrong

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