This semester I’ve been taking a class on Islamic Finance in the Global Economy – its been one of the most interesting class I’ve taken so far, with an excellent combination of some of the hottest topics in international finance and the cultural and religious developments in the Islamic world. Islamic finance isn’t very well known in the mainstream world yet, but its rapidly become quite important both because of the large populations of Muslims living in many Western countries and the newfound wealth of many nations in the Gulf, among other reasons.

The basic idea of Islamic finance is that it tries to create a financial system which is in line with the ethical and business principles established in the Quran and the Islamic legal tradition. Perhaps the best known part of Islamc finance is that standard interest is forbidden – based on in large part principle that risks and returns should be shared in commerce. There are a range of other ethical principles which also frame finance in the Islamic tradition

This creates a major challenge for developing alternative methods to charge for the cost of capital, since so much of conventional finance involves interest based transactions. However, the last 20 years have seen a major explosion of new financial forms which are Shariah compliant and also replicate the risk and return profiles of conventional financial instruments, including Shariah compliant leases, mortgages, futures, options, and mutual funds.

The class has been especially interesting because our professor is one of the leading experts on the field, and has been able to give us a good understanding of both the moral economy of Islam that underlies these new products, the political and cultural environment in different regions that is shaping the development of the Islamic finance, as well as the products themselves.

I’ve been working on my final paper for the class, on frameworks for handling financial distress and bankruptcy in Islamic law. I handed the topic in some depth last year in a class on corporate restructuring at Harvard Business School. It’s a rather underdeveloped part of the field at the moment, but I’m looking at ways of possibly applying classical law on transferring debts and contributing debts t commercial partnerships as a framework to replicate the distressed debt market, debt restructuring, and debt to equity swaps.

One of the many benefits of Fletcher is the ability to cross register at Harvard Business School, and I’m currently in the midst of a paper for an excellent class I took there this semester, Behavioral Finance. While Fletcher has a great assortment of business courses, it is helpful to be able to take some more specialized classes on advanced finance at HBS – moving into the more advanced second year finance electives there was also a good reminder that Fletcher’s intro to corporate finance courses can definitely stack up the first year business school courses, as it wasn’t difficult to get in the swing of HBS, although their teaching style is somewhat different.

Anyways, finance and economics are perhaps some of the most “positivist” fields, with an implicit assumption that laws can be discovered through the application of progressive reasoning – the common assumption of a “rational actor” is the most obvious example of this. Of course, most people are less than rational when it comes to making financial decisions (As anyone who lost money on Pets.com stock in the late 1990’s could tell you).

This course on behavioral finance brought in insights from psychology and recent economic analysis on how people make seemingly irrational decisions to understand inefficiencies in the market. These inefficiencies can create major profits for sophisticated investors, so it’s quite an interesting field both intellectually and practically.

For our final paper I decided to look at IPO underpricing in China. When it comes to market irregularities China has them in abundance, so it’s an interesting topic. I’m looking at IPO underpricing – in the US first day returns on IPO’s are around 15%, while in China they are regularly over 100%, so there is definitely something odd going on.

Underdeveloped market regulations and a lack of disclosure seem to a big part of the situation, so my law classes at Fletcher are coming in handy. Fletcher also has an excellent course that gives you a very full understanding of the arcane intricacies of econometrics, which is definitely coming in handy as I wade through academic papers with lots of regressions. Back to the t stats and securities regulations . . .

Colorado doesn’t seem very much like the Persian Gulf – there isn’t much of a ski scene in Abu Dhabi and I don’t think the lifestyle of Boulder would go over very well in Riyadh, but apparently Colorado has the potential to become an oil superpower that would surpass the Gulf. I haven’t been fooled by someone selling dubious stocks through the Internet or fictitious oil wells in the suburbs of Denver – the potential of Colorado’s energy reserves was explained by Dr. Daniel Fine of MIT at a luncheon at Fletcher earlier this week.

Colorado has huge reserves of oil shale – much like the tar sands in Canada, it is a geological formation which has huge quantities of oil trapped inside porous rocks. Of course, squeezing oil out of millions of tons of rocks is much more expensive than drilling a well in the deserts of Kuwait. But with oil now consistently above $60 a barrel, a range of new approaches to energy are now becoming cost effective. Dr. Fine explained that the Colorado oil shale has been examined many times in the past, but underdeveloped technology and lower oil prices kept these reserves undeveloped. There have also been major technological innovations in recent years which make developing the shale cheaper.

Many of the issues of costs, technology, and strategic access to energy that this lecture raised were handled in one of the most interesting courses I have taken at Fletcher, Petroleum in the Global Economy. Taught by a former Exxon executive, the cource gave us an excellent framework for understanding the cost and operational structures that drive new energy projects, and the role of technology and policy in shaping energy demand for the future. Just as an example, the idea of “peak oil” (the idea of a finite and declining amount of oil) ignores the feedback effects of price changes and technology. For example, the Colorado oil shale would not be included in practical reserves 15 years ago, due to lower prices and older technology then.

Of course, developing a major new source of petroleum does nothing to deal with the problem of climate change, and there are questions about the environmental impact of heavy energy development in a beautiful part of the West, but the potential of Colorado shale opens up many new options for US energy policy and energy companies.

While the Fletcher name is well regarded around the world, one of the things you discover here is that there are certain areas where there is such a critical mass of Fletcher connections that the school’s network seems to touch many well placed figures throughout the region. It seems like the Caucasus region is becoming one of these epicenters, a fact which was clear to see at an event last week on the diplomacy of the Caucasus states and the changing role of Russia in the region and the Middle East.

The event was moderated by Fletcher’s Professor Hess, who teaches a range of courses on Southwest Asia. I’m currently taking his class on the states of Central Asia and the Caucasus, so it seemed like this event was perfectly timed to provide some first hand perspective on what we had been covering in class. He had an excellent array of speakers – the Georgian Ambassador to the UN, the Consul of Azerbaijan in Los Angeles (who is a recent graduate of Fletcher!), and a student from Turkey our PhD program.

Since the event was organized as a seminar / discussion as opposed to a series of formal lectures, it was especially interesting because the speakers were able to talk about their own understanding of the dynamics between the nations of the region and their hopes and strategies for the future.

All of the speakers said that cooperation and good relations were especially important for the newly independent nations of the Caucasus. First, as small nations it allowed them to stand strong together – as the Georgian ambassador said, small nations don’t have the luxury of making mistakes. But even more interesting was the idea that good relations would allow these nations to serve as a bridge between Europe and nations of Central Asia – whose huge reserves of energy are ever more important. One tangible result of this cooperation is the Baku-Ceyhan pipeline, which brings Azerbaijan’s energy through Georgia and Turkey to the Mediterranean, without having to pass through Russia.

What was most striking for me was the degree to which the ideas and intellectual frameworks used by these well connected and influential diplomats were similar to the ideas were we covering in our class on this region. It was a great reminder that we were really getting behind the headlines to understand the trends that are shaping these countries.
I’m another newcomer on the Fletcher blog scene. I’m in the last semester of my second year, and so will not try to fall back on default topics like “Progress (or lack thereof) on My Thesis” and “Where did the time go?”

Although most of my work at Fletcher has been in the world of international finance, my debut on the blog scene is going to be pretty solidly anchored in more political / security side of the school. This has been one of those weeks where the is a ridiculous abundance of excellent events going on at Fletcher, from government officials to academics and even a Pakistani painter who uses the Mughal miniature painting tradition to express political themes in a very interesting aesthetic style.

One interesting event this week was a lecture by Michael Chrisochoidis, former Greek Minister of Public Order (an excellent title for a cabinet position, and much more formidable sounding than “Homeland Security,” the equivalent position in the US) He spoke on his experiences dismantling N-17, a Greek Marxist inspired terrorist organization that had carried out a wave of assassinations since the 1970’s.

The topic appealed to me because I’ve always found it interesting how little the US debate on counter-terrorism has looked at the experiences of European countries in combating the “Red/Black” terrorism of Communist and Fascist extremists in the 1970’s. Although this earlier “age of terrorism” is not well known in America, when I was living in Italy there were many reminders of the mark terrorism made on this era, the so called “Years of Lead” because of the wave of shootings of business leaders and politicians.

To fight these terror groups, Chrisochoidis argued that it was key to redefine the public image of terrorism, to challenge the narrative the extremist groups established around their actions. By showing the impact of their assassinations on the families of the survivors, the public’s perception of the group shifted from seeing N-17 as a seemingly invincible group who periodically assassinated a few politicians or generals to a group of killers. This made it much easier to collect information and get solid leads for investigation. He also stressed the importance of carrying out counter-terrorism work and investigations in line with the standards and values of a democratic society.

Fletcher has strong connections to the Greek political world – the current Prime Minister Costas Karamanlis is a Fletcher alum, and a regular series of speakers from Greek academia and politics always provides an interesting perspective on European and Mediterranean issues.

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Warning: Cheater Post – Last night I spoke as part of a panel organized by the Tufts African Students Organization on Misconceptions of Africa. What follows is an essay that basically covers what I said. Consider this practice for when I start recycling old papers as part of my thesis…

Panel on Misconceptions of Africa
March 27, 2007 – Tufts University

Most of what you need to know about the misconceptions of Africa can be found in travel writing. Three weeks ago, the Sunday New York Times Travel section focused on the continent. So, given the topic of this panel, I wanted to just review some of the front-page stories and headlines [at this point I flipped through the print edition and gave some commentary on what I observed]:

-Victoria Falls, Livingstone
-Senegal, A Treehouse Can Be Your Penthouse – ’savage land’
-Ethiopia, ‘Yes, we have food.’
-Nairobi, “the wildlife is friendly?”; A cosmopolitan city AND quintessentially African.
-Quickly through the pictures of animals, tree houses, and white people

There’s a subtext at work in all of these articles that covers some of the biggest misconceptions of Africa:

-’Discovered’ by Europeans.
-Savage and inhospitable to Northerners.
-Starving
-There are only animals here and what is African is not cosmopolitan

The purpose of this panel is to shed light on and discuss these misconceptions, and given what we’ve already brought to light, it should come as no surprise that these themes would be present and powerful in a NY Times travel guide. But as all our presenters here have made clear, these are in fact MISconceptions. So, I’d like to move in a slightly different direction and look at why these misconceptions persist, especially in travel writing and the tourism industry in general.

My first experience living on the continent of Africa came in 2000 – I was studying abroad in Zimbabwe – and many of my own misconceptions, most of which have been brought to light by this panel, were revealed within the first month if not sooner. Subsequently, my undergraduate thesis was, in large part, about these misconceptions and their political and psychological impact on both Zimbabweans and Americans. Now, I really don’t think I’m that fast a learner, so one has to wonder why these misconceptions persist in the writings of others who have been to Africa. An easy argument is that they sell. But that argument is rooted in the real, deeper reason we have the misperceptions in the first place: Our image of Africa is foundational to our image of ourselves. We need Africa to represent everything we believe ourselves not to be and we won’t accept contrary images from those who have seen through this fallacy.

The most base stereotypes of Africa are telling in this context:

*The leaders are the most corrupt tyrants. So corrupt, oppressive, and tyrannical in fact, that even our leaders can make a claim to legitimacy.

*They are a starving, diseased people. Real hunger, sickness, and poverty only exists in Africa.

*Life in Africa is found in the savannah. The African wilderness should remain wild, it is our jungle, kept at a distance.

*Africans can not survive without us, they are our project.
In all these myths, we see that we depend on Africa for our own identity. And part and parcel to all of these myths is the monolith of Africa, which can only be so easily defined, distorted, distanced, and ultimately saved if it is packaged as one manageable land. If Africa contained diverse people, cultures, even geography, this wouldn’t be so easy. Furthermore, it’s not so easy to write about a place you don’t understand, a place that turned all your previous notions of it upside down, a place that forces you to revaluate your own image because its image has now changed.

Travel writing, by definition, is a resistant space in which we would be hard-pressed to reimagine Africa. But let’s not cut the Sunday Times any slack here: perpetuating these misconceptions is dangerous stuff. I’m not an apologist for brutal leaders and inept regimes in any part of the world, but I do believe that these misconceptions play a role in many of the disasters that have befallen continental Africa.

The fact that our only images of actual people in Africa are of 1. The victim and 2. The tyrant are a part of the reason that Africa has been host to at least two genocides since we said never again. It’s in part why leaders like Patrice Lumumba are eliminated. It’s why we were complicit in Apartheid. And it’s why billions of dollars have been made while millions of lives are lost in the Congo.

See it’s difficult to care about a place that’s populated by victims and tyrants. The victims you do your best for – and we do give so much afterall, mostly in order to sustain our own image as saviours – but victims, at the end of the day, will still be victims. And when they face such tyrants, how much can we really contribute anyway? You see, these images lead to inaction in the face of tragedy.

My point here is not to lay blame though, it’s to show just how difficult it is to break these misconceptions. So much depends on them. But for a start, I think we should take the advice of Kwame Anthony Appiah who encourages us all to “collide and contaminate.” Basically what he means is we need to learn about each other in the most painful ways possible. I can’t think of anything more painful than learning about someone else in order to unlearn what I thought I knew about myself.

Professor Appiah is himself a walking Africa myth buster: A gay Ghanaian philosopher. His philosophy and writing is focused on identity, but it’s also in large part about misidentity, about getting rid of what we thought was true and what has been keeping us from truly engaging across cultures. He argues that the need for the people of the world to learn about each other is far greater than the pain that will be inflicted on us during that process. He has also written for the Sunday Times, and in his essay The Case For Contamination, he covers many of the points we’ve touched on here:

When we make judgments, after all, it’s rarely because we have applied well- thought-out principles to a set of facts and deduced an answer. Our efforts to justify what we have done – or what we plan to do – are typically made up after the event, rationalizations of what we have decided intuitively to do. And a good deal of what we intuitively take to be right, we take to be right just because it is what we are used to. That does not mean, however, that we cannot become accustomed to doing things differently.

Doing things differently means colliding with others, colliding with our misconceptions of them and of ourselves. We need to realize that what we are use to is not at all what is right. Likewise, we need to read and learn but we need to question every word of what we are taught. Especially when it comes to travel writing. Travel writing is what we are used to, actually traveling would mean doing things quite differently

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I’m curled up on my parents’ couch next to the woodstove, cradling a cup of chamomile tea, listening to the spring peepers out on the pond, and feeling rather nostalgic. I spent this weekend–the second weekend of spring break–home with my family outside of Hershey, PA. It’s always so good to come back to this old farmhouse where I grew up–to visit my friends at The Hanoverdale Country Store, where I spent a couple of summers working in the plant nursery; to sip Yeungling Lager with my brother; to take walks and runs through the fields around our home; and to be in a place where people think that Boston is a truly exotic place to live. It helps to put my life in perspective.

Being surrounded by such inspiring, accomplished people at Fletcher, it’s easy to forget that there exist people who don’t study international relations, who’ve never left their country, and who don’t aspire to do either one of those things. Sometimes, I find that I can get sucked into the stress of academic life–worrying about exams, assignments and such–which is silly, of course, because I should just embrace this incredible opportunity to study at a school like Fletcher.

One thing that’d been a source of stress was finding a summer internship–and more significantly, finding FUNDING for a summer internship. If the internship thing doesn’t work out though, I came up with a Plan B this weekend that I’m feeling very excited about. I’ll have 3 month-long phases to my summer: the first month, I’ll work in New York City, making some contacts at different organizations in preparation for next year’s job search; the second month, I’ll find a Buddhist retreat somewhere, because I’ve been wanting to learn more about the Buddhist philosophy; and the third month, I’ll come back here to PA where I’ll work on a friend’s organic farm and do research for her on medicinal plants and beekeeping. I’ll also help her to get a food cooperative and a non-profit off the ground. And in September, I’ll head back to Boston, refreshed and ready to get back into the swing of Fletcher life.

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I’m curled up on my parents’ couch next to the woodstove, cradling a cup of chamomile tea, listening to the spring peepers out on the pond, and feeling rather nostalgic.  I spent this weekend–the second weekend of spring break–home with my family outside of Hershey, PA.  It’s always so good to come back to this old farmhouse where I grew up–to visit my friends at The Hanoverdale Country Store, where I spent a couple of summers working in the plant nursery; to sip Yeungling Lager with my brother; to take walks and runs through the fields around our home; and to be in a place where people think that Boston is a truly exotic place to live.  It helps to put my life in perspective.

Being surrounded by such inspiring, accomplished people at Fletcher, it’s easy to forget that there exist people who don’t study international relations, who’ve never left their country, and who don’t aspire to do <em>either one </em>of those things.  Sometimes, I find that I can get sucked into the stress of academic life–worrying about exams, assignments and such–which is silly, of course, because I should just embrace this incredible opportunity to study at a school like Fletcher.

One thing that’d been a source of stress was finding a summer internship–and more significantly, finding FUNDING for a summer internship.  If the internship thing doesn’t work out though, I came up with a Plan B this weekend that I’m feeling very excited about.   I’ll have 3 month-long phases to my summer: the first month, I’ll work in New York City, making some contacts at different organizations in preparation for next year’s job search; the second month, I’ll find a Buddhist retreat somewhere, because I’ve been wanting to learn more about the Buddhist philosophy; and the third month, I’ll come back here to PA where I’ll work on a friend’s organic farm and do research for her on medicinal plants and beekeeping.  I’ll also help her to get a food cooperative and a non-profit off the ground.  And in September, I’ll head back to Boston, refreshed and ready to get back into the swing of Fletcher life.

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You’ve read the headlines, but as an embedded traveler, I can report from the front lines. Spring break began with six inches of snow and a canceled flight -15 minutes after I got through security, of course. Making the best of it with some sledding, lots of basketball watching, and the St. Patrick’s Day parade were all a part of my weekend. 72 hours later, the skies are blue and I’m back at the airport. I’m even on a plane. A plane with only one working engine…

Back to the airport. Some delays, some despair, but miraculously, the engine is fixed (I’ll believe anything at this point) and I’m actually in the air. Arriving in Syracuse, NY (that’s right, Grad Student Gone Wild: Spring Break ‘07) and more snow and a seriously scary landing. But I’m here, and ready to basically do what I was doing in Boston, work on papers, get internship, apply for scholarships, and hopefully watch some basketball. I’ll even get to do some of it in Sunday River, Maine, which will be nice. Don’t worry, I’m driving.

So, that’s my airline horror story. Not so horrific, I guess. Though at one point I was ready to give up on traveling all together and was kind of wondering what US airways was willing to do for me after all this: “You’ll get a free refund.”

How about a voucher too? Maybe some miles? Nope, just a refund. That’s the real horror story, almost criminal.

Speaking of criminal, today we entered the fifth year of the war in Iraq. Feeling a bit worn down from my travels and sobered by the occasion, I thought it would be a good idea to watch the film Why We Fight, a documentary on Dwight D Eisenhower’s warning about the creation of a military industrial complex and a measure of how much we have heeded that warning.

Say what you want about the movie or the necessity of a military industrial complex, but the fact is it has been achieved and, in the context of Ike’s counsel in his farewell address, to an horrific extent.

Some memorable quotes from the film:

Donald Rumsfeld: Anyone with active intelligence knows that Iraq has weapons of mass destruction.

President Eisenhower: Now this conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence — economic, political, even spiritual –is felt in every city, every Statehouse, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources, and livelihood are all involved. So is the very structure of our society.


Chalmers Johnson: When war becomes that profitable, you’re gonna see more of it.

Eisenhower: The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.

Joseph Cirincione: It turns out, it’s not that hard to get a country to go to war.

What gets me at this time of year, for the last three years, is the thought of how easy it was – how little people were able to resist this war in the first place. The film does a good job of revealing why.

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A foot of new-fallen snow might not have been the ideal start to spring break for a lot of students, but I reveled in it.  A few girlfriends and I headed to northern New Hampshire to spend the weekend at Laurie’s camp on “Success Pond,” located 15 miles up a dirt road outside of her hometown.  The tiny cabin was just big enough for 7 of us, and we spent the weekend using gas lights and an outdoor water spigot.  As the snow piled up around the cabin, we did lots of chatting, warmed our feet next to the wood stove, took naps under piles of blankets and learned how to play four different kinds of poker–my favorite was “Omaha.”  Last night, Laurie made corned beef and cabbage–accompanied by some special beverages–in honor of St. Patrick’s Day.  We also managed to take advantage of our pristine surroundings; my face is chapped from our windy cross-country ski trek around Success Pond this morning.   Needless to say, I didn’t get much studying done for my midterm this week.

I’m back in Medford now to prepare for the midterm exam of a course at Harvard’s Kennedy School of Government (KSG). Unfortunately, KSG’s spring break doesn’t coincide with ours, so it means that I’ve got to hang around here to attend class and take the exam on Wednesday.  I’m cross-registered in Samantha Power’s “Human Rights and U.S. Foreign Policy” course.  It’s a little bit of a bummer to be stuck here in Medford for most of the break, but all the same, it’s nice to have this time to devote to Professor Power’s course.  It’s my favorite class this semester.   I’m especially interested in American exemptionism, one of the themes that we’ve been addressing in Power’s class.  (Professor Power distinguishes “exemptionism” from “exceptionalism,” two terms that I’d always used interchangeably.)  Some of the other Fletcher students who are taking the class are frustrated by the course’s one-sidedness, but I’ve got to admit that it doesn’t bother me that much.  (It helps when the professor’s on your side!)  And I’ve also got to admit that as a big admirer of Samantha Power, I might be a little biased.

The course readings consist mostly of stimulating news articles, which is a refreshing switch from the heavy, theoretical journal articles that dominate Fletcher coursework.  We’ll start discussing her Pulitzer-winning book, <em>A Problem from Hell</em>, in April.  Although it’s a huge class (130 people!), her lectures are so engaging and inspiring that they compensate for the limited opportunity for real class discussion.  Our midterm is a “24-hour take-home,” which means that we’ll receive it via email on Wednesday at 5pm, and we have until Thursday at 5pm to submit it electronically.

And THEN, I can officially enter spring break mode.  Thursday evening, I’ll drive home to Hershey, Pennsylvania, to visit my parents and brother–a nice reprieve before the second-half of the semester begins.  I’m a little jealous of all my friends who are spending this week in Puerto Rico, but even buried under a foot of snow and the weight of my midterm, I’m appreciating this break.

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Last week, I attended a Question and Answer session with Dr. Ingrid Mattson, President of the Islamic Society of North America at the Kennedy School of Government at Harvard University. Dr. Mattson is the first female, first convert, and first North American to ever be president of the organization which seeks to be an exemplary and unifying Islamic organization in North America that contributes to the betterment of the Muslim community and society at large.

Dr. Mattson earned her Ph.D. in Islamic Studies from the University of Chicago in 1999. Her research is focused on Islamic law and society. She is also a Professor of Islamic Studies and the Director of Islamic Chaplaincy at the Macdonald Center for Islamic Studies and Christian-Muslim Relations at Hartford Seminary in Hartford, CT.

One of the most interesting parts of the conversation was when a student asked Dr. Mattson about the fact that some of the rules of Islam that previously applied to women, such as the treatment towards slandering of a chaste woman, have in practice been also applied towards the slandering of a chaste man and if this might start setting a precedent for gender equality regarding those passages of the Koran, the Holy book of Islam, that provide different treatment for men and women. One example that came up during the discussion was that of marriage. In Islam, a Muslim man is allowed to marry a woman who is either Christian or Jewish but the same does not apply for women. When Dr. Mattson was asked about where she stands on this issue, she declined to comment as she was still uncertain about where she stood on the issue. What I thought brilliant about this was the fact that Dr. Mattson did not downplay the complexity of the issue. Rather than providing us with an answer, she was willing to admit that as the leader of her organization, she did not know all the answers nor did she pretend to. She also exercised this same humility through out the discussion.

For more information on ISNA please visit: http://www.isna.net/

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My eyes have been on news from Zimbabwe this week for a couple of reasons. First off, I spent a semester there in the year 2000 that was utterly life-changing. That was a unique time for the country as well, it marked the arrival of an opposition political party, the MDC, that left its mark on the parliamentary elections. Which leads me to my second reason for keeping a keen eye on news from Zim this week: the MDC’s leadership was arrested and tortured following a demonstration last weekend. Condemnation has been wide-spread among states and human rights groups alike. This most recent heinous act by the Harare police is, in many ways, one among many terrible offenses orchestrated by the Mugabe administration and supported by the ZANU-PF government.

But the demonstration and the vicious response to it are significant and telling in the context of the recent history of opposition protest and ZANU-PF abuse. To begin with, this was a united protest by a fractioned opposition and the police reaction only strengthened this characteristic: over 100 arrested, including the three leaders of the most influential opposition factions. When I was studying in Zimbabwe, the MDC was THE opposition, it’s position appeared strong, and that time seems so hopeful in my memory now. Brutal rule, economic disaster (which is due only in part to mismanagement of land redistribution), and harmful opposition infighting and misdirection have turned Zimbabwe from hopeful to hazardous at best in the intervening seven years.

So what’s the meaning of the events of the last few days and what can be done. Fletcher’s own Daniel Drezner wonders whether Sunday’s protest and the response are signs of a crumbling regime or business as usual for Mugabe. While there are reasons to be hopeful in light of continued opposition unity and civil discontent, I’d say sanctions will deserve very little credit when Mugabe finally cedes power – which could happen in a month or two years, but I’m pretty sure ZANU-PF’s leader for life has ruined his party’s chances of governing Zimbabwe beyond his retirement. I was in Zimbabwe a little less than a year ago and saw first hand that the political and economic elite in Zimbabwe, though a miniscule cabal, managed their portfolios just fine in a surreal economy dominated by the black market. Clearly, there are ways around sanctions when the international community has abandoned you.

But I’m not sure what those of us outside of Zimbabwe can do other than scream. It’s our duty to condemn human rights violations and support those being violated, but beyond that, we’re resigned to waiting this thing out. International Crisis Group provides some excellent recommendations here, particularly calls for regional engagement and mediation and their directive to the UN Secretariat and Security Council.

Meanwhile, the brutalized opposition leaders have finally been admitted to a hospital, but only on court order after a judge was so dismayed by their bloody appearance in court. This is the state of the rule of law in Zimbabwe. This is the level of surrealism a government has been able to achieve in the 21st Century.

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On Tuesday, I had my last class in “Qualitative Research Methods in Post-Conflict Societies.” It’s a “module” course, which means that it’s only a half-credit and only lasted half-a-semester. It was one of the more professionally-applicable courses that I’ve had here at Fletcher. We learned basic skills of conducting observations, interviews, and data analysis in challenging environments. Professor Marc Sommers led the course like a workshop, coupling our reading materials with anecdotes about his own professional experience. It was a small course; there were only seven of us, and we all learned a lot from working with one another. As a culmination to the intensive class, a few of us went out with Professor Sommers to Orleans in Davis Square for celebratory beers. It was a great ending to a great course.

If I’d had any revenge to exact upon Professor Sommers, however, I might have done so at the annual “Faculty Waits on You Dinner,” held this past Friday. Every year, the Community Action Group, Fletcher’s volunteer student organization, hosts a dinner at which members of Fletcher faculty and staff serve the students. Proceeds from the dinner and a post-dinner auction benefited the Somerville Homeless Coalition this year. Professor Sommers ended up being our waiter; here’s the proof:

“Ah, yes, Professor… Some red wine would be nice.” (Photo, courtesy of Lillie Paquette; thanks, Lillie!)

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My thesis is due tomorrow, so I will be figuratively chain-sawing my internet connection shortly. However, I wanted to pass on a study by a Wharton prof. and a Cornell grad student that connects three of my personal/research interests: economics, basketball, and racial bias. I didn’t think it could be done, but here it is. Although the paper has yet to go through the formal peer review process, the NYT says that “several prominent academic economists said it would contribute to the growing literature regarding subconscious racism in the workplace and elsewhere, such as in searches by the police.”
“If something cannot go on forever, it will stop.”

This quote is attributed to Herbert Stein, the chairman of the Council of Economic Advisers under President Nixon and President Ford in response to a question about growing deficits.

In case the throngs of European shoppers in New York’s Soho District and on Boston’s Newbury Street haven’t given it away yet, the USD hit an all-time low against the EURO last week. The USD traded at a record low of $1.3681 on April 27, and has stayed in that neighborhood ever since. As Bloomberg has reported, the dollar dropped 2.22 percent to $1.3651 in April for its biggest monthly drop since November. And as if that were not enough to get the shoppers/tourists excited, the GBP broke the psychological barrier of $2 in the same week.

So who is made better off by this declining dollar? Exporters and most of the US Tourism sector. Who does it hurt? Fletcher students going overseas who are being funded in USD. And those who have been saving up for that Mercedes.

Why is the USD taking a beating? In addition to the very large current account deficit, the USD has been weakened by recent reports of a slowdown in the US economy, political and natural resource instability in Iraq, and the relative strength of the GBP and the EURO.

There are several innovative ideas in the contemporary literature that have examined the sustainability of this very large (both in absolute terms and relative to GDP) US current account deficit. Most, if not all of the literature suggests that it is not indefinitely sustainable. However, there is some disagreement about how long the US will be able to sustain the current account deficit without significant decline in the value of the USD.

Most economists agree that the US current account deficit must eventually be brought back into balance through a depreciated dollar and greater exports. There is greater disagreement as to whether this adjustment would happen smoothly, or whether a discrete drop in the dollar would occur. The latter outcome would put the US economy at risk for a recession, as it is unlikely that export-led growth would be able to compensate for the depreciating dollar quickly enough to keep total output from falling.

Some optimists view the ratio of the current account to America’s large, deep, and flexible asset markets as a sign that it is not a serious problem. Others, such as Federal Reserve Chairman Ben Bernanke argue that the deficit is the result of a global savings glut. The crux of this argument is that the causes of the US current account deficit originate outside of the US and its domestic policy choices.

As you can see, not everyone is 100% convinced by this argument.

“We’re now led by men who think that macho posturing makes Stein’s Law go away. On issues ranging from budgets to foreign policy, they insist that we can sustain the unsustainable. And when challenged to explain how, they engage in magical thinking.”

-Paul Krugman

Those of you interested in whether these theories are legitimate or just magical thinking should read this, this, and this.

Or, you could take one or two of Prof. Klein’s International Finance classes and judge for yourself. And because it wouldn’t be a blog of mine without some econ dork humor: Principles of Economics (This guy has a Ph.D. from my alma mater, so I’m required to plug it)

The FT recently reported on the fallout following last week’s outage in RIM’s BlackBerry service. “We’re 14 hours into no BlackBerries,” said Tony Fratto, White House Spokesperson. “We’ve already started a 12-step group.”

Welcome to the world of BlackBerry addiction. It turns out that Mr. Fratto is not alone, as is evident here, here, and here.

For those of you lucky enough not to suffer from this addiction allow me to explain how I recently got caught up by this menace. As loyal readers of this blog (thanks mom…and Happy Birthday!) already know, I recently switched cell phone providers after a miserable customer service experience with a company I’ll call Jog. A fringe benefit of switching carriers is the heavily subsidized hardware that usually comes with a new service agreement. In my case, this allowed me to ditch my old Samsung in favor of a shiny new BlackBerry Pearl. So far, so good. Only, as most of you probably know, the major selling point behind BlackBerry is push email. You can have email of up to 10 accounts forwarded directly to your phone in quasi real time. As convenient as this is, the end result is the feeling of being tethered to your computer at all times. You also end up looking like an absolute twit reading emails in bars, clubs, restaurants, and public bathrooms. It is however, helpful for procuring that last slice of leftover pizza in the Hall of Flags.

The only high-tech devise that makes one look sillier is one of those ridiculous Bluetooth headsets, where the user appears to be muttering incoherently to his or herself. (Come to think of it, Bluetooth users seem to be overwhelmingly male. Perhaps women are too sensible for that kind of thing.)

It turns out that all of the multitasking that my generation so proudly touts as a sign of its progress is actually hindering our ability to get things done. A prominent neuroscientist remarked in a recent NYT article that a core limitation of the brain is its “inability to focus on two things at once.” However, the researchers did find that listening to soothing music (as long as there are no lyrics) can improve concentration.

Now if you’ll excuse me, I’m going to switch off the highlights from the NBA playoffs in favor of some classical masterpieces so that I can finally finish my thesis.

First of all, I want to express my gratitude to the entire Fletcher Mafia, who made Follies 2007 as good as ever. The event was simply amazing and side-splittingly funny. I am going to lobby very hard to get that Fletcher Connection spoof video posted SOMEWHERE. I also want to plug Fletcher’s excellent radio show, The World in Focus, which can be heard every Thursday from 2-4 right here. You also have the option of downloading last week’s episode. Previous episodes have focused on everything from French Hip-Hop to American Soul Music.

Back to your regularly scheduled programming…..

David Leonhardt is a journalist with a reoccurring column about business and economics for the New York Times. As an econ nerd I usually really appreciate his take on things.

Last week he wrote an excellent column about the recent housing slowdown in the US. He did some interesting calculations on the economics of buying versus renting in the current market. Real estate is not something I know a lot about, but I found it very interesting that housing values in places like Boston and New York would presently require a CAGR of about 4-5% over the next 5 years to make buying a better investments than renting. Unsurprisingly, Leonhardt advocates renting in these markets unless you are planning to stay in the same house for at least five years, which in this day and age is a very long time for someone in their 20s. That said, in the long run buying usually makes more sense than renting.

One of my favorite papers about Real Estate comes from Steven Levitt (of Freakonomics Fame) and Chad Syverson. It focuses on the incentives of real estate agents, and how those incentives can affect the sale price of houses.

For anyone whose eyes haven’t glazed over already, congratulations! Here is a partial list of other econ related things I’ve enjoyed reading lately.

Subjects:

Political Markets
Affirmative Action
Soccer Referees
Undercover Economist

Oh, and because Drew plugged TrueHoop and FreeDarko, I have to plug Deadspin, which is part of the gawker franchise, and the best sports site on the web IMHO.
Last week I had the opportunity to go on a roadtrip with one of my roommates. Our end destination was Memphis, Tennessee, where we made the requisite stops at Graceland, Beale St., the National Civil Rights Museum, and Sun Records. It was only my second trip to the South, and it was a great break from chilly New England and my thesis.

My friends often ask me what it’s like to live in Boston. I really like it here, but the city’s vibe is difficult to capture in a few words. Here is my best shot. Hopefully it will include things you won’t find on Wikipedia. Note that I’m from a suburb of Portland, Oregon, and that my opinions are surely different than those of someone who has grown up here.

The first thing that strikes me about Boston is that there are only two seasons here: “baseball season” and “not baseball season.” The amount of fanaticism that people in Mass have for their baseball team is pretty much unrivaled in the US. The only fans I’ve seen that come close are European or South American soccer fans. Getting tickets to a Red Sox game in spring is like winning the lottery, although tickets do appear frequently on stub hub as soon as the Sox drop out of contention. Also, the attention that the Sox get is helpful to a diehard Celtics fan like me, because it means that tickets for the Cs are easy to get. The Cs are so bad this year that the first victory I’ve seen in person came last night at the expense of the Lebron-less Cavs.

Other notables:

• Bel Biv DeVoe’s (some of Roxbury’s finest) hit “Poison” turns up conspicuously often on club playlists
• It’s “The Hub” (as in Hub of the Solar System. Seriously). No one here calls it Bean Town.
• Dunkin Donuts. Learn to love it.
• A square in Boston is what most Americans would call an intersection
• Boston has no street signs. None.
• The accent is for real. Watch The Depahted or Good Will Hunting and take notes. They’re wicked good films.
• It’s really easy to have a good time in Boston, as long as that good time ends before 1am

A partial list of must see events and locations in The Hub:

• Paddy’s Day Parade in Southie
• Head of the Charles race
• The Boston Marathon
• Harvard Square (especially The Adidas Store and the outside seating at Au Bon Pain)
• Hillside Liquors in Medford (sentimental choice)
• Fenway, Gillette Stadium (good distance south of the city), and The Garden
• George Wright Golf Course (best deal in town)

Okay, it’s not as salacious as it sounds. A brand terrorist is the opposite of a brand advocate. A brand terrorist spreads negative word of mouth about his/her experience with a brand. This is exactly what I have resorted to after a terrible customer service experience with a certain mobile phone company, which out of the goodness of my heart will remain nameless. Some People Read Into Nothing Though.

(Apologies to my International Marketing Seminar colleagues who have heard me talk about this for weeks.)

So, what happened to me? To paraphrase an overused MasterCard cliché:

Unexplained Phone Charges: $135
Account Spending Limit: $125
Having your phone shut off 4 times in two weeks (without being told about it), spending 20+ hours on hold, and being shuffled between dozens of equally inept “customer service professionals”: Disastrous

By the way, if you’re as tired of automated customer service as I am, the NYT provided a helpful link in a recent article about poor customer care in the mobile phone industry. The website is called gethuman, and it divulges how to get a human customer service person on the phone without going through endless “press 1 if….” queues.

Bad customer service in the mobile phone industry is nothing new. Business Week recently ranked firms according to customer service quality by industry, and T-Mobile (which coincidentally is the provider that I switched to) emerged victorious in the mobile phone segment. I’m aware that the mobile phone industry is a very capital intensive oligopoly, but it would behoove these firms to learn a lesson from the airline industry. Air travel used to be much more regulated, which resulted in limited competition between a small number of entrenched incumbent firms. After deregulation in the 1970s consumers were given more choice, and many of them jumped ship to newer airlines with a different model of what customer service should look like (e.g., Southwest and JetBlue). Although the regulatory environments of the two industries are not identical, the lesson to be learned is that customers should not be taken for granted.

Incidentally, JetBlue was originally ranked number four on BW’s list. However, they were removed after their well publicized operations fiasco in February, which resulted in hundreds of customers being stranded on planes and in airports. Although they got absolutely pounded in the press for days (they had the added misfortune that the disaster happened in the huge media market of New York), I believe JetBlue will recover from this setback in the long-run due to their superb commitment to serving customers. But don’t take my word for it. 78% of people polled in a survey at businessweek.com disagreed with their decision to remove JetBlue from the rankings based solely on this incident.

Like Natalie, I’m also a new edition to the Fletcher blogosphere. I will be graduating at the end of this semester, so I promise to keep the “where did the time go” theme to a minimum in future blogs.

The fact that my thesis is far from completed (unlike some of my wiser classmates who have finished already) will continue to keep me busy. It is amazing how easy it is to procrastinate when the alternative involves trying to produce cogent analysis spanning 60-100+ pages. Foxwoods will give you 2:1 odds right now that my blog entries this semester will end up being longer than my thesis.

In other news, the wind chill reached minus 18F this morning. My best guess is that I was walking across the Charles River on the way to my HBS class at juuust about that time. Brrrrrrrr! As a native of the Pacific Northwest I don’t find subzero temperatures very amusing. Although this whole “sunshine” thing is a welcome change from the weather in Vancouver, WA (my childhood hometown) and Berlin, Germany (my previous hometown). Anyway, it made me pine for back in early January when a bunch of the Fletcher Mafia was actually able to BBQ in 70 degree weather on the back porch of the Blue House. I think my climate change colleagues might be on to something. (Disclosure: I live in said Blue House with 5 other male Fletcher students. No, it’s neither a frat house nor an abbey.)

This is one of those weeks at Fletcher in which the calendar is so packed full of speakers that it’s difficult to choose who to see. However, this Thursday I’m definitely going to attend Dr. Vali Nasr’s talk entitled “Theocracy, Democracy and the Conservative Consolidation in Iran.” If the prospect of hearing an accomplished scholar present a fascinating topic doesn’t do it for you, please take note of the reception immediately following the event. Inside info for the uninitiated: The Charles Francis Adams Lecture Series rivals The Jebsen Center for best post-event spreads. I propose drafting Wolfgang Puck to cater Sidney Taurel’s post-lecture reception on the 14th so that we Econ/IBR folks can gain some traction in the spread wars.

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