The General covers its tracks



Detroit is deeply entrenched in the culture of the car; one is needed to get just about anywhere, and any trip seems to take at least a half hour. Most people live in the suburbs surrounding the city, which necessitates driving even further. Perhaps not so surprisingly, General Motors, once the largest car maker in the world but now embroiled in bankruptcy proceedings, is primarily to thank for this. Or, blame, depending on your point of view.

In the 1920s and 1930s, cars were a luxury item in the US; not many people, especially in major cities, could afford them. But they didn't need them - private rail companies blanketed cities with mass transit service via electric trams, offering convenient transportation to millions of urbanites. For a while, these companies owned their own power generators, which produced so much power that excess electricity was sold off to the public. In many cases, the electricity proved so lucrative that the roles were reversed: the power generation became the larger company owning the tram services. The trams ran on cheap, rebated electricity as a result.

But then, a slow shift began to happen. In 1935, a new anti-trust law dictated that power companies couldn't own tram services any more, so the transit firms became independent. For various reasons that included a loss of electricity rebates, they began to struggle financially. Then, a company called National City Lines (NRL) began buying up the smaller rail firms in 45 major cities across the US, including Los Angeles, New York, Philadelphia, Cleveland and, yes, Detroit.

And then, it dismantled them all. Rail lines were replaced with less convenient bus routes. Other tram companies that relied on connections with the now-defunct lines foundered, until the privately-owned rail services disappeared altogether. As it turned out, National City Lines was owned by a conglomeration of companies, led by - you guessed it - General Motors. It, along with Firestone, a few petroleum companies and other firms involved in the conglomeration, were eventually brought to court on conspiracy charges in 1949, but were only found guilty of conspiring to monopolise sales of buses to its companies. They were acquitted of all monopolisation charges surrounding the purchase of the tram lines.

The results of NRL's actions are hotly debated, and there are other factors surrounding the demise of the tram systems, but it can't be questioned that around this time, the culture of the car took hold of America. To help it along, new municipal zoning laws mandated large car parks for city stores and shopping centres. Suburbia was touted as the most desirable address for families. And car sales soared.

As GM faces its darkest days yet, it keeps a brave face and brazenly declares it has an optimistic future. Funny, but there is not a word about its shady past.

WHAT IS A BLACK HOLE?

1. Black holes are objects whose gravity is so strong not even light can escape their pull

2. They can be created when massive stars collapse under their own weight

3. Large black holes can also be formed when smaller ones collide and merge

4. The biggest black holes lurk at the centre of many galaxies, including our own

5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed

In numbers: PKK’s money network in Europe

Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010

Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille

Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm

Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year

Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”

Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners

TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013 

The rules on fostering in the UAE

A foster couple or family must:

  • be Muslim, Emirati and be residing in the UAE
  • not be younger than 25 years old
  • not have been convicted of offences or crimes involving moral turpitude
  • be free of infectious diseases or psychological and mental disorders
  • have the ability to support its members and the foster child financially
  • undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
  • A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Skewed figures

In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458.