The Coming Second Life Business Cycle
By Matthew Beller
Posted on 8/2/2007
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Matthew Beller's Second Life avatar,
designed to resemble Ludwig von Mises
Ludwig von Mises once wrote that an economist "must be conversant with mathematics, physics, biology, history, and jurisprudence, lest he confuse the tasks and the methods of the theory of human action with the tasks and the methods of any of these other branches of knowledge." In modern times, with the increasing popularity of computer-based interactive virtual worlds, it may soon be necessary for economists to familiarize themselves with the intricacies of virtual reality, lest they confuse the tasks and the methods of real-world economics with those that apply to virtual reality.
Some economists might dismiss virtual worlds as an application for economics, given that they do not contain any resources that are traditionally considered scarce (lumber, steel, oil, etc.), but a closer inspection reveals that some virtual worlds contain real market economies complete with scarce resources, property rights, entrepreneurship, and exchange. Furthermore, real people underlie the inhabitants of virtual worlds, so we can therefore analyze their economies using Austrian economics and the science of human action.
One virtual world that is currently popular is called Second Life. Second Life was created by the San Francisco-based company Linden Research, Inc. and opened in 2003. It is an Internet-based three-dimensional virtual world where its 8 million unique residents can interact with one another.[1] Residents can create virtual clothing, hairdos, houses, airplanes, concert halls, video games, and endless other items by using an infinite supply of "primitives," which are atomistic objects that can be shaped, colored, combined, and programmed to behave in a particular way. Residents can then replicate their creations and sell the copies to one another at whatever price they set.
Second Life has attracted attention from Wired Magazine, The Economist, and other media with stories of a burgeoning economy and entrepreneurs earning their sole incomes by selling virtual goods and services. Accordingly, real-world economists and Second Life's residents alike could benefit from a closer look into the actual workings of its economy, and the effects of economic intervention.
Second Life's economy could reasonably be compared to that of a small foreign country dependent on tourism. Consumers are inhabitants of the real world who take what are essentially pleasure trips to Second Life, perhaps to meet new people at a dance club, shop for virtual clothing, attend a conference, or gamble at a casino. Like real tourists, consumers exchange their real US dollars for Second Life's currency, the Linden Dollar (L$), typically on a currency exchange run by Linden, called the LindeX. They then use their L$ to purchase goods and services created by other Second Life residents, and if they have extra L$ when they're done, they can sell their L$ for US$ on the LindeX.
Linden, essentially representing the state in Second Life's economy, does not generally interfere with economic activity. The Economist reports on Linden founder Philip Rosedale's attitude toward intervention,
"Mr. Rosedale prefers to rule Second Life with Adam Smith's 'invisible hand' only. To him that means treating every resident the same, whether it happens to be Toyota or 'an 80-year-old woman from India.' Both will pay the same price for their [virtual land]; what they do with it is up to them."
Proponents of private property and non-intervention would certainly laud such a hands-off policy. If Linden's goal is to create a setting for a stable, growing economy that will provide the most satisfaction to the most residents, it must avoid the pitfalls of interventionism that plague real-world economies. As Ludwig von Mises and others have shown, one interventionist policy creates distortions that must be fixed by other interventionist policies, which lead to problems that require further intervention, and so on, until the state controls every aspect of the economy.
Unfortunately, despite Mr. Rosedale's free-market rhetoric, a look at Linden's actual practices reveals that it has already started down the path of intervening in the economy. One critical example of Linden's intervention is that it has granted itself the ability to manipulate the single-most important commodity in any economy: money.
In the Terms of Service, the L$ is defined as "a limited license right available for purchase or free distribution at Linden Lab's discretion, and is not redeemable for monetary value from Linden Lab." By defining the L$ in such a way, Linden has granted itself the power of a central bank in managing Second Life's equivalent of a fiat currency. Linden can create as many new L$ as it wants, whenever it wants, and spend them or give them away at its own discretion. Also, because Linden maintains a peg of about L$270=US$1 on the LindeX, it gives the appearance that the L$ is as good as real-world money.
Fiat currencies are subject to much criticism, particularly by Austrians. However, they are not criticized because they cause undesirable economic distortions in and of themselves. Rather, they are criticized because, unlike commodity monies such as gold, they can be created from nothing, so are highly susceptible to artificial expansion and manipulation. This expansion, as the Austrian theory of the business cycle shows us, is the source of economic distortions that lead to unsustainable booms, followed by inevitable busts.
To establish whether Linden has in fact been manipulating the L$ supply and determine if Second Life is susceptible to bust, we can examine historical economic statistics published by Linden for signs of artificial growth in the L$ supply. The graph below shows Second Life's L$ supply since September of 2005, as well as the two consolidated sources of month-to-month changes in the money supply.
Your eye might be drawn to the sudden acceleration in L$ growth at the end of 2006 coincident with a significant increase in LindeX sales (where Linden is creating new L$ and selling them for US$), but that is not necessarily a bad thing. Ignoring the problems with the US$, LindeX sales represent inflows of real wealth into Second Life. When residents purchase L$ on the LindeX using US$ that they have earned in the real world, they are foregoing consumption in the real world in order to spend or invest their newly purchased L$ in Second Life.
It is actually the small, perpetual budget deficit that reveals something quite sinister. Unlike L$ sales on the LindeX, they do not reflect a flow of real wealth into Second Life. Instead, they are created by Linden to represent wealth, but no economic production was involved in creating them. These deficits occur when the weekly L$ stipends Linden pays to premium residents exceed its revenues from land rentals and other administrative services it provides to residents. In order to fund the deficits, Linden creates new L$ and injects them into Second Life.
In the United States, the Federal Reserve's primary mechanism for increasing the US$ supply involves purchasing debt securities issued by the US Treasury. Linden's process slightly differs in that it creates exactly as many L$ as are needed to make up for its budgetary shortfalls without ever issuing any debt. Every time Linden runs a deficit, the L$ supply instantly increases by an equivalent amount.
Linden's monthly budget deficit might appear insignificant in the graph, but in fact Linden has been increasing the money supply by an average of 6% per month this way. Annualized, it is more than doubling it each year. During the past year and a half, Linden created L$876 million through its deficits, which makes up over 33% of today's L$ supply. These figures certainly suggest that Linden has been artificially expanding the L$ supply, but there is one possible argument that would indicate otherwise.
Premium members who receive weekly L$ stipends pay Linden US$9.95 per month for that privilege. One could argue that this US$9.95 represents an inflow of real wealth into Second Life to make up for the L$ created through deficits, but this argument is tenuous. These US$ revenues are presumably used by Linden to pay its employees, maintain its servers, and pay other operating and financing costs, with the remaining profit or loss passed on to its shareholders. Unfortunately, as the graph below shows, there have been months when Linden's US$ revenues would not have been enough to cover the new L$ creations.
In September of 2005, Linden collected as much as US$98,000[2] from premium members, which is equivalent to about L$26 million at the L$'s current exchange rate. But during that month, it created L$36 million in order to fund its fiscal deficit. That means that even if Linden had not allocated a single US$ to its employees or incurred any real-world costs whatsoever, it still would not have collected enough US$ to match its newly created L$.
$25
"Second Life's residents could benefit from a closer look into the actual workings of its economy, and the effects of economic intervention."
Given the strong evidence that Linden has unnaturally inflated the L$ supply, Austrian economics tells us that there are a couple of potential outcomes that are likely to occur. In the first, Linden will stop running significant deficits at some point. With less L$ available to spend, residents will demand fewer goods and services, leading to lower prices and reduced profits. Previously profitable enterprises will go out of business and the wealth of many residents will decrease, slowing overall economic activity.
The other possibility is that Linden will continue running deficits to the point that a sufficient number of residents and speculators will recognize the L$'s frailty. In what Ludwig von Mises referred to as a "crack-up boom," everyone will scramble to redeem his L$ for "real goods," which, in the case of Second Life, is probably the US$.
As more and more people sell their L$ on the LindeX, Linden might choose to maintain its L$270=US$1 peg for some amount of time, but operating under the assumption that it has not maintained 100% US$ reserves, it will eventually run out of US$ or decide to stop selling them, and the L$ will depreciate rapidly. In either outcome, residents will discover that they possess less wealth than they perceived they had during the time leading up to the crash.
To summarize, it appears very likely that Second Life will experience at least some form of economic recession. Depending on its severity, it might result in Linden's losing many of its customers. If Linden wants to prevent this from happening and foster a stable, growing economy within Second Life, it should apply the lessons of Austrian economics to its policies: abolish restrictions on content, strengthen the ability of residents to enforce their property rights, and, most important, tie the L$ to a real-world commodity money backed by 100% reserves.
--------------------------------------...
Matthew Beller is a former employee of the Federal Reserve Board of Governors and currently works for the Securities and Exchange Commission in Los Angeles. Send him mail. Comment on the blog.
The Securities and Exchange Commission disclaims responsibility for any private publication or statement of any SEC employee or Commissioner. This article expresses the author's views and does not necessarily reflect those of the Commission, the Commissioners, or other members of the staff.
Notes
[1] SecondLife.com/
Have you play : Second Life ? Economy ?
OK, long introduction, but in a lot of ways fairly correct. In many ways, Second Life is an economic system of its own and can act as it own nation-state. Until recently, that nation-state worked mainly under laissez-faire economics of libertarian policies.
Recently, a grid-wide ban on gambling was implemented, wiping out instantly a whole sector of the SL economy that had wider consequences. SL's oldest in-world bank is facing a monetary crunch as withdraws have exceeded deposits, resulting in tighter restrictions on account access. However, the widest consequence may not be felt immediately, and that is the de facto recognition of the value of the Linden dollar above and beyond the technical definition. I suspect that this is the blood in the water that will draw RL governments from about the globe into SL for the purpose of financial regulation (e.g. taxation).
I'm not too worried about the magic creation of Linden dollars by Linden Lab. After all, the value of any currency is based solely on its ability to be used as a conveyance of trade. If some creative accounting is needed to prevent hyper-inflation or deflation, then I'm in favour of it. I will say that fixing the Linden dollar to any RL currency is dangerous as that is simply that currency in another name.
Yes, there are dangers in fiat currency, but in RL even the use of precious metal standards has not always lead to a stable economy. Noting that the Linden dollar floats with RL currencies will simply be another money market in play. Wealth is indeed created in-world by its residents through production of items that do sell, and if the in-world money supply has to increase to meet that, the better,
Reply:http://www.secondlife.com
Reply:it's a game.
Sunday, August 22, 2010
Externalities and Oil Firms?
hi, im doing my microeconomis project which is "globalization effects on Petronas". When the the firm digs up oil, suppply decreases, so in the long-run, price will rise and therefore cause a problem for consumers. But at the same time, this encourages research on other cleaner source of energy and also of course the hybrid car. So is the negative externality, the high price effect on consumers and the positive externality is in education(new technology) and less pollution(less carbon dioxide emission)? If yes, can you guys out there please give me more ideas of externalities by oil firms. If no, please correct me and also give me more ideas.
(would appreciate good websites for referencing or can just give me idea and i search myself for evidence)
Thanks. ^__^
Externalities and Oil Firms?
Hi, I am not sure if this helps, since it is vaguely to the side of what you are asking about. I do think that the encouragment of research is much less direct than regarding the depletion of supplies. Also I think that the use of oil has a wide variety of hidden costs to the environment (in bvery many levels) , health ( also on many levels like accidents, pollution, sedentary lifestyle)
But regarding oil/gasoline and externalities, try to do a web-search for
"The Real Cost of Gasoline", "Transportation Cost and Benefit Analysis" and "External Costs of Transport, Update study".
(would appreciate good websites for referencing or can just give me idea and i search myself for evidence)
Thanks. ^__^
Externalities and Oil Firms?
Hi, I am not sure if this helps, since it is vaguely to the side of what you are asking about. I do think that the encouragment of research is much less direct than regarding the depletion of supplies. Also I think that the use of oil has a wide variety of hidden costs to the environment (in bvery many levels) , health ( also on many levels like accidents, pollution, sedentary lifestyle)
But regarding oil/gasoline and externalities, try to do a web-search for
"The Real Cost of Gasoline", "Transportation Cost and Benefit Analysis" and "External Costs of Transport, Update study".
Thursday, August 19, 2010
If I wanted to market a product to single, well-educated, wealthy 21-29 year old British women where would I..
Where does this sort of demographic group congregate in large numbers? If the market research shows that our product sells especially well to single, young (21-29), well-educated British women (University Graduates + Public School educations), from well-heeled backgrounds, what environments and which type of locales should we concentrate the heaviest advertising? Where does this demographic group congregate in large numbers so they are sure to be reached with advertising? What type of businesses does this demographic element have contact with more so than other groups? What type of neighbourhoods would this demographic reide in, and where would they work? Which media outlets would they prefer? What type of pubs, restaurants, etc., would this group be found in within most British cities?
Believe it or not, I'm told this is one of the more difficult demographic groups to reach because they are seen as fickle consumers.
Any help would be appreciated. Thanks!
If I wanted to market a product to single, well-educated, wealthy 21-29 year old British women where would I..
well, i think im one of those women, but for the fickle! So i hope this helpd - area central london, chelsea, kensington, knightsbridge, the city, regent street, south kensington, notting hill gate [some parts], mayfair. Restaurants - nobu / mayfair - zuma / knightsbridge - ok cant think of any more at the moment but i hope this helps.
Reply:take a body building course and open a massage parlour.
tee hee
Reply:gymnasia.
You are right about this lot being fickle, they are also astonishingly naive.
Any magazine which features Hollywood movies would get to them.
Marks and Spencers have a late opening for their food dept on a thursday night and you see these people in droves.
They spend unusually large amounts of time on line so prehaps the internet would be a good way to reach them.
Reply:You assume you need to go to them - but you could run direct mail (easy source data lists with these demographics - or list broker will) and other interactions (email/web viral) that would bring them to you.
If you want to go with the former you can look at engaging some media event company to put on show at many of these locations. They could also advise you re locations.
Reply:You could consider some advertising in a quality glossy magazine. They have both expensive 'inside' or on the cover advertisements, which may not be suitable for you at this time; however the classified section at the back may be a good start.
Perhaps you could also try to get some editorial in a magazine to 'showcase' your product, as a descriptive paragraph or two can do wonders to really get the readers interested in purchasing the product.
There are many local magazines too, such as 'Living South', 'Limited Edition', 'The Guide', etc which are aimed at the local people and appeal to a broad range of women you have mentioned. Try searching on the Internet for local publications in the areas you wish to market to.
You could also approach reputable shops and sell to them maybe as a concession or on a sale-or-return basis.
Good Luck
Reply:In London, try marketing it in central London.. Knightsbridge, Kensington, Chelsea, Notting Hill, Holland Park, Primrose Hill, Islington, Hampstead, the City, etcetc. Try it at places like Fresh %26amp; Wild, Harvey Nichols, Selfridges, etc where they are likely to shop.
Reply:Noticeboard at Morrison's?
dr teeth
Believe it or not, I'm told this is one of the more difficult demographic groups to reach because they are seen as fickle consumers.
Any help would be appreciated. Thanks!
If I wanted to market a product to single, well-educated, wealthy 21-29 year old British women where would I..
well, i think im one of those women, but for the fickle! So i hope this helpd - area central london, chelsea, kensington, knightsbridge, the city, regent street, south kensington, notting hill gate [some parts], mayfair. Restaurants - nobu / mayfair - zuma / knightsbridge - ok cant think of any more at the moment but i hope this helps.
Reply:take a body building course and open a massage parlour.
tee hee
Reply:gymnasia.
You are right about this lot being fickle, they are also astonishingly naive.
Any magazine which features Hollywood movies would get to them.
Marks and Spencers have a late opening for their food dept on a thursday night and you see these people in droves.
They spend unusually large amounts of time on line so prehaps the internet would be a good way to reach them.
Reply:You assume you need to go to them - but you could run direct mail (easy source data lists with these demographics - or list broker will) and other interactions (email/web viral) that would bring them to you.
If you want to go with the former you can look at engaging some media event company to put on show at many of these locations. They could also advise you re locations.
Reply:You could consider some advertising in a quality glossy magazine. They have both expensive 'inside' or on the cover advertisements, which may not be suitable for you at this time; however the classified section at the back may be a good start.
Perhaps you could also try to get some editorial in a magazine to 'showcase' your product, as a descriptive paragraph or two can do wonders to really get the readers interested in purchasing the product.
There are many local magazines too, such as 'Living South', 'Limited Edition', 'The Guide', etc which are aimed at the local people and appeal to a broad range of women you have mentioned. Try searching on the Internet for local publications in the areas you wish to market to.
You could also approach reputable shops and sell to them maybe as a concession or on a sale-or-return basis.
Good Luck
Reply:In London, try marketing it in central London.. Knightsbridge, Kensington, Chelsea, Notting Hill, Holland Park, Primrose Hill, Islington, Hampstead, the City, etcetc. Try it at places like Fresh %26amp; Wild, Harvey Nichols, Selfridges, etc where they are likely to shop.
Reply:Noticeboard at Morrison's?
dr teeth
I wrote a book agent representative company, they referrred me to a publisher who's interested in my work?
but I've only described it, it's only 70% done as I said, but they said they want something to review in 10 days!!!
It's not a novel or fiction, it's science and based on much research. I wrote an abstract, is that enough? Do they want a sample of actual book text?
I'm a dry scientist, I admit it...but this book I want to appeal to the lay person for their personal application.
Should I write the abstract straightforward or catchy? I can write "Did you know that...etc." catch lines and introduce concepts, or I can write, "The purpose of this book is to articulate for the lay health consumer ways to..."
Help? I'm new to this. Thank-you.
I wrote a book agent representative company, they referrred me to a publisher who's interested in my work?
Did "they" say exactly what they want to "review"?
It's more common to get a request for either a synopsis or a few chapters. Hmm.
It seems to me you should ask your agent.
He/she/they (whoever actually represents you) could and should be able to answer this question for you... regarding whether it is a synopsis or chapters 'they' want.
That is what agents do, how they make their bit of the pie.
If "they" want a synopsis, I suggest a trip to a library to look in "The Writer's Market 2008" (or a book like it that a reference librarian recommends) and study their samples of book synopses (the 'good' and the 'bad')...and just read everything you can on how to write a good one.
Then take a description of your work down to as bare-bones as possible, to a paragraph even --and begin to build your synopsis from that. A good synopsis is usually just one page, and that includes addresses and whatnot.
By the way... Congratulations. You seem to be on your way.
I wish you luck now.
PS. If this science book is for lay people, I'd write a synopsis that lay people would surely understand. So I suggest that.
If that's what "they" want.
Keep in mind it may be some chapters instead... You need to find out from the people you're dealing with. More luck.
Reply:I don't know jack about non-fiction, but I know about an excellent writers' website which has quite a few published nonfic writers, some of them academics, who've walked the path you're starting and can probably answer your questions and give you additional advice you don't yet know to ask for. See the Writing NonFiction Books board at
http://absolutewrite.com/forums/index.ph...
Reply:Have you checked these people out through the usual sources? Preditors and Editors? Absolute Write Water Cooler's Bewares and Background Checks? Check carefully before you send anything to anyone. Normally a book proposal is what you first show an agent or a publisher for a non-fiction book.There are many books out there that teach you how to write one. Invest in one. But if you don't find the name on the Writers Beware lists, write to Dave K at Preditors or Victoria Strauss and James MacDonald at Absolute write and ask for advice. They are the people at the forefront of the Writers Beware scene. Pax-C
It's not a novel or fiction, it's science and based on much research. I wrote an abstract, is that enough? Do they want a sample of actual book text?
I'm a dry scientist, I admit it...but this book I want to appeal to the lay person for their personal application.
Should I write the abstract straightforward or catchy? I can write "Did you know that...etc." catch lines and introduce concepts, or I can write, "The purpose of this book is to articulate for the lay health consumer ways to..."
Help? I'm new to this. Thank-you.
I wrote a book agent representative company, they referrred me to a publisher who's interested in my work?
Did "they" say exactly what they want to "review"?
It's more common to get a request for either a synopsis or a few chapters. Hmm.
It seems to me you should ask your agent.
He/she/they (whoever actually represents you) could and should be able to answer this question for you... regarding whether it is a synopsis or chapters 'they' want.
That is what agents do, how they make their bit of the pie.
If "they" want a synopsis, I suggest a trip to a library to look in "The Writer's Market 2008" (or a book like it that a reference librarian recommends) and study their samples of book synopses (the 'good' and the 'bad')...and just read everything you can on how to write a good one.
Then take a description of your work down to as bare-bones as possible, to a paragraph even --and begin to build your synopsis from that. A good synopsis is usually just one page, and that includes addresses and whatnot.
By the way... Congratulations. You seem to be on your way.
I wish you luck now.
PS. If this science book is for lay people, I'd write a synopsis that lay people would surely understand. So I suggest that.
If that's what "they" want.
Keep in mind it may be some chapters instead... You need to find out from the people you're dealing with. More luck.
Reply:I don't know jack about non-fiction, but I know about an excellent writers' website which has quite a few published nonfic writers, some of them academics, who've walked the path you're starting and can probably answer your questions and give you additional advice you don't yet know to ask for. See the Writing NonFiction Books board at
http://absolutewrite.com/forums/index.ph...
Reply:Have you checked these people out through the usual sources? Preditors and Editors? Absolute Write Water Cooler's Bewares and Background Checks? Check carefully before you send anything to anyone. Normally a book proposal is what you first show an agent or a publisher for a non-fiction book.There are many books out there that teach you how to write one. Invest in one. But if you don't find the name on the Writers Beware lists, write to Dave K at Preditors or Victoria Strauss and James MacDonald at Absolute write and ask for advice. They are the people at the forefront of the Writers Beware scene. Pax-C
Will France surpass the USA as the primary protector of the Persian Gulf states?
Gulf states broaden contacts beyond US
By ROBERT H. REID, Associated Press Writer Sat Jan 19, 1:42 PM ET
CAIRO, Egypt - The promise of a new French base in the United Arab Emirates is the latest sign that Arab Gulf countries are expanding their commercial and military contacts to bolster security without appearing too dependent on the United States.
ADVERTISEMENT
President Nicolas Sarkozy has announced that France next year will become the only Western country other than the U.S. to have a permanent defense facility in the Gulf.
The deal comes at a time when Gulf countries want to protect themselves against a resurgent Iran. At the same time, they don't want to rely just on the U.S., with American prestige in the Middle East running low and the fear that U.S.-Iranian rivalry could drag the region into war.
France also plans to open a branch of its St. Cyr military academy in Qatar and take part in military exercises in February and March with forces from the UAE and Qatar. And France and the UAE have signed a civilian nuclear cooperation agreement as a first step toward building a nuclear reactor to help diversify energy sources.
"The UAE gets the advantage of playing the field a bit, not because it wants to walk away from the U.S. relationship but because this gives them leverage over both the French and Americans to get what they want," Mideast analyst Jon Alterman said.
France's new base will house up to 500 soldiers, sailors and airmen. By comparison, the United States maintains about 40,000 U.S. troops on bases across the Gulf — including Kuwait, the key staging ground for Iraq, and Bahrain, which hosts the U.S. Navy's 5th Fleet headquarters.
The United States has been the dominant outside power in the Gulf since Britain closed its permanent bases in 1971. The Arabs are keenly aware that no European country can supplant the Americans as the primary protector of the oil-rich Gulf states.
"Perhaps they (Emiratis) thought that a French base would be a visible means of protection but in a less ostentatious manner, a little more discreet" than an American installation, said Stephane Lacroix, an analyst with the Sciences Po school of political science in Paris.
The new base also underscores France's claim as a global power capable of playing a role in parts of the world beyond its former colonial sphere of influence. The nearest French base is in Djibouti, a former French colony in the Horn of Africa.
French Defense Minister Herve Morin said the base would help France to support warships it routinely sends to the Gulf and "participate in the stabilization of the region."
Gulf governments and investors have been shifting away from the United States, seeking partners in Asia and Europe. The reasons for the shift are both economic and political, including strains in relations with the U.S. since the Sept. 11, 2001, attacks.
Saudi Arabia and other Gulf countries have been looking to Europe for more consumer products as well as investments in areas such as high-speed railway systems, where the Europeans have unique experience.
For Gulf Arabs, Iran has made the need for leverage with the Americans all the more important. Although the small, wealthy oil sheikdoms fear Iranian influence, especially among their Shiite populations, they also worry that Washington's hardline stand against the Islamic Republic could drag them into conflict.
Gulf Arab leaders made clear to U.S. President George W. Bush during his visit to the region this month that they oppose trying to isolate Iran.
"We have relations with Iran and we talk to them and if we feel there is any danger (in the region) we will talk to them about it," Saudi Foreign Minister Prince Saud al-Faisal said last week.
The threat of a U.S. attack on Iran has receded since the fall, when a U.S. intelligence report concluded that the Iranians stopped trying to build a nuclear bomb four years ago.
Nevertheless, Bush emphasized during his Middle East tour that he still considers the Islamic Republic a major threat, branding it the world's top sponsor of terrorism. He also warned of "serious consequences" if the Iranians attack American ships in the Gulf.
"We don't want Bush to take advantage of Iranian misbehavior and go to war," said Mustafa Alani, an analyst with the Gulf Research Center in Dubai. "France is more politically acceptable in the region. We don't want Americans to appear as the only protectors."
__
Associated Press reporter Natacha Rios contributed to this report from Paris.
Will France surpass the USA as the primary protector of the Persian Gulf states?
The French can't even take care of themselves. Remember WWI, WWII, etc.
Reply:If you read the article even it says France cannot replace the US as a major protector of the area. France had colonial/protectorate powers in that region after WW1 with Britain and had difficulties before. France does not have the means of projecting forces to protect the area quickly and is more of a symbolic trip line then anything else.
Reply:Sorry, the French Minitelnet is down for the day, I'm afraid that their plans to take over the world will have to be delayed.
Reply:About time the French got off their butts and did something.
Reply:THE FRENCH?
for christ's sake those cheese eating surrender monkies could be overtaken by a boy scout troop.
Reply:If the French want to go in there, go right ahead. They forgot about the Suez Canal crises, Early Viet war, thier luck against the Germans since 1870, and the overall fun the Americans are having. I am sure they will do a good job.. best of luck......the US had better have a back up plan to pull them out of this one.
By ROBERT H. REID, Associated Press Writer Sat Jan 19, 1:42 PM ET
CAIRO, Egypt - The promise of a new French base in the United Arab Emirates is the latest sign that Arab Gulf countries are expanding their commercial and military contacts to bolster security without appearing too dependent on the United States.
ADVERTISEMENT
President Nicolas Sarkozy has announced that France next year will become the only Western country other than the U.S. to have a permanent defense facility in the Gulf.
The deal comes at a time when Gulf countries want to protect themselves against a resurgent Iran. At the same time, they don't want to rely just on the U.S., with American prestige in the Middle East running low and the fear that U.S.-Iranian rivalry could drag the region into war.
France also plans to open a branch of its St. Cyr military academy in Qatar and take part in military exercises in February and March with forces from the UAE and Qatar. And France and the UAE have signed a civilian nuclear cooperation agreement as a first step toward building a nuclear reactor to help diversify energy sources.
"The UAE gets the advantage of playing the field a bit, not because it wants to walk away from the U.S. relationship but because this gives them leverage over both the French and Americans to get what they want," Mideast analyst Jon Alterman said.
France's new base will house up to 500 soldiers, sailors and airmen. By comparison, the United States maintains about 40,000 U.S. troops on bases across the Gulf — including Kuwait, the key staging ground for Iraq, and Bahrain, which hosts the U.S. Navy's 5th Fleet headquarters.
The United States has been the dominant outside power in the Gulf since Britain closed its permanent bases in 1971. The Arabs are keenly aware that no European country can supplant the Americans as the primary protector of the oil-rich Gulf states.
"Perhaps they (Emiratis) thought that a French base would be a visible means of protection but in a less ostentatious manner, a little more discreet" than an American installation, said Stephane Lacroix, an analyst with the Sciences Po school of political science in Paris.
The new base also underscores France's claim as a global power capable of playing a role in parts of the world beyond its former colonial sphere of influence. The nearest French base is in Djibouti, a former French colony in the Horn of Africa.
French Defense Minister Herve Morin said the base would help France to support warships it routinely sends to the Gulf and "participate in the stabilization of the region."
Gulf governments and investors have been shifting away from the United States, seeking partners in Asia and Europe. The reasons for the shift are both economic and political, including strains in relations with the U.S. since the Sept. 11, 2001, attacks.
Saudi Arabia and other Gulf countries have been looking to Europe for more consumer products as well as investments in areas such as high-speed railway systems, where the Europeans have unique experience.
For Gulf Arabs, Iran has made the need for leverage with the Americans all the more important. Although the small, wealthy oil sheikdoms fear Iranian influence, especially among their Shiite populations, they also worry that Washington's hardline stand against the Islamic Republic could drag them into conflict.
Gulf Arab leaders made clear to U.S. President George W. Bush during his visit to the region this month that they oppose trying to isolate Iran.
"We have relations with Iran and we talk to them and if we feel there is any danger (in the region) we will talk to them about it," Saudi Foreign Minister Prince Saud al-Faisal said last week.
The threat of a U.S. attack on Iran has receded since the fall, when a U.S. intelligence report concluded that the Iranians stopped trying to build a nuclear bomb four years ago.
Nevertheless, Bush emphasized during his Middle East tour that he still considers the Islamic Republic a major threat, branding it the world's top sponsor of terrorism. He also warned of "serious consequences" if the Iranians attack American ships in the Gulf.
"We don't want Bush to take advantage of Iranian misbehavior and go to war," said Mustafa Alani, an analyst with the Gulf Research Center in Dubai. "France is more politically acceptable in the region. We don't want Americans to appear as the only protectors."
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Associated Press reporter Natacha Rios contributed to this report from Paris.
Will France surpass the USA as the primary protector of the Persian Gulf states?
The French can't even take care of themselves. Remember WWI, WWII, etc.
Reply:If you read the article even it says France cannot replace the US as a major protector of the area. France had colonial/protectorate powers in that region after WW1 with Britain and had difficulties before. France does not have the means of projecting forces to protect the area quickly and is more of a symbolic trip line then anything else.
Reply:Sorry, the French Minitelnet is down for the day, I'm afraid that their plans to take over the world will have to be delayed.
Reply:About time the French got off their butts and did something.
Reply:THE FRENCH?
for christ's sake those cheese eating surrender monkies could be overtaken by a boy scout troop.
Reply:If the French want to go in there, go right ahead. They forgot about the Suez Canal crises, Early Viet war, thier luck against the Germans since 1870, and the overall fun the Americans are having. I am sure they will do a good job.. best of luck......the US had better have a back up plan to pull them out of this one.
Blue Ray / HD DVD the war continues. Update what do you think? I have no bias on either side.?
Format war is always a nightmare but hopefully one that will eventually come to a conclusion. So with the new events that have been taking place where is a consumer at from a buyer's viewpoint.
No Xbox, PS3 too much bias tension, or Beta/VHS comments. Why? Cause Sony developed both formats %26amp; sold VHS b/c it was inferior. They took the approach that the best product sells period, %26amp; underestimated the selling power of good marketing. Besides in modern research, tools like the internet allow buyers to be more informed about what they are buying. So comments really aren't relevant for our era.
Updates: WB goes exclusive Blue Ray. Joining Sony pictures, Fox, Disney and others. On HD's sidline there is Paramount. All though a lone wolf a very powerfull one still.
Price, if you look at the prices they really have met an even keel. Both players %26amp; movies. Blue Ray holds the advantage in the way that Samsung, Sony, LG %26amp; many others make Blue Ray players. Hd players only avail through Toshiba
Blue Ray / HD DVD the war continues. Update what do you think? I have no bias on either side.?
Hard drives and internet distribution will be the real winners. The era of shinny plastic disks is over.
No Xbox, PS3 too much bias tension, or Beta/VHS comments. Why? Cause Sony developed both formats %26amp; sold VHS b/c it was inferior. They took the approach that the best product sells period, %26amp; underestimated the selling power of good marketing. Besides in modern research, tools like the internet allow buyers to be more informed about what they are buying. So comments really aren't relevant for our era.
Updates: WB goes exclusive Blue Ray. Joining Sony pictures, Fox, Disney and others. On HD's sidline there is Paramount. All though a lone wolf a very powerfull one still.
Price, if you look at the prices they really have met an even keel. Both players %26amp; movies. Blue Ray holds the advantage in the way that Samsung, Sony, LG %26amp; many others make Blue Ray players. Hd players only avail through Toshiba
Blue Ray / HD DVD the war continues. Update what do you think? I have no bias on either side.?
Hard drives and internet distribution will be the real winners. The era of shinny plastic disks is over.
How does this body of my business letter sound?
Dear Ms. Rathwell:
A recent article about the use of Bisphenol-A has inspired me to write this letter to you.
According to the article and my research, there are products in the market that contain Bisphenol-A which cause a number of health risks such as cancer in humans . As a consumer I am concerned if the products I am buying are safe or not. I applaud the decision that Mountain Equipment Co-op has made by removing products that contain Bisphenol-A. This has motivated me to boycott such products as well till Health Canada deems them safe. I am anxious as to know what results will Health Canada release next May.
Thank-you for reading this letter.
anything i need to change? is grammar okay?
How does this body of my business letter sound?
You may want to just say "Thank you for your time" instead of thanks for reading this letter. You may also want to replace "till" with "until." Finally, you may want to say "I am anxious to see the results that will be released next May by Health Canada."
Reply:hi you have done very well with youre letter, well laid out and good presontation, well done blue
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A recent article about the use of Bisphenol-A has inspired me to write this letter to you.
According to the article and my research, there are products in the market that contain Bisphenol-A which cause a number of health risks such as cancer in humans . As a consumer I am concerned if the products I am buying are safe or not. I applaud the decision that Mountain Equipment Co-op has made by removing products that contain Bisphenol-A. This has motivated me to boycott such products as well till Health Canada deems them safe. I am anxious as to know what results will Health Canada release next May.
Thank-you for reading this letter.
anything i need to change? is grammar okay?
How does this body of my business letter sound?
You may want to just say "Thank you for your time" instead of thanks for reading this letter. You may also want to replace "till" with "until." Finally, you may want to say "I am anxious to see the results that will be released next May by Health Canada."
Reply:hi you have done very well with youre letter, well laid out and good presontation, well done blue
braces for teeth
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