Hotel Chain Relocates

A holding of private equity firm The Blackstone Group,L.P.,Hilton Hotels,is moving its headquarters from pricey Beverly Hills,California,to Washington,D.C. suburb Tysons Corner,Virginia.Hilton has signed a lease for 100,000 square feet of a 300,000 square foot office building called Park Place II.The property is owned by B.F.Saul and is 17% leased.The move from Beverly Hills was announced in January,and should be accomplished by autumn 2009.Stephen Schwarzman is Blackstone co-founder and CEO.

A Broader Resolve

The uncompromising core of the Taliban and al-Qaida militants must be defeated,President Obama insisted.We will also work on a reconciliation process in every Afghan province.We will set clear markers to measure progress,and hold ourselves accountable.None of these steps will be easy;nor can they be undertaken by the U.S. alone.What's at stake is the very notion that free nations can come together for the common security.We will seek not simply troops from our allies,but a commitment to civilian action as well.We seek a broader coalition,incuding Russia,China and Central Asia.Nearly 700 Americans have died in the war,plus troops from 20 other nations.The USA did not choose to fight a war in Afghanistan.Most of the blood on al-Qaida's hands is the blood of Muslims.The road ahead will be long.We will use all the elements of our national power to defeat al-Qaida and defend our allies,Mr.Obama promised.

A Shift In Tone

Our military push will secure the August elections in Afghanistan,Mr.Obama pointed out.At the same time,we will shift emphasis to training Afghan security forces.The additional U.S. troops,to eventually total an augmentation of 21,000,have already increased our training capacity.Every American unit will be partnered with an Afghan unit in this push to turn security over to Afghan forces.The Afghan economy is undercut by a booming narcotics trade.We need to send more agriculture specialists,engineers and lawyers.There must be a substantial increase in civilians on the ground from us and our allies,as well as the UN.Our efforts will fail if we don't invest in the Afghans' future.Aid saves us an enormous amount of money in the long run,the President explained.

What Al-Qaida Brings

Al-Qaida offers the people of Pakistan nothing but destruction,President Obama stated.We support legislation authorizing 1.5 billion dollars of aid to Pakistan every year for the next five years.The creation of opportunity zones in the border region is a down payment on our own future.We must isolate al-Qaida from the Pakistani people.We will launch a standing trilateral dialogue between the United States,Pakistan and Afghanistan,to include intelligence-sharing.We must reverse the Taliban's gains.Our allies have borne a heavy burden.Now we must make a commitment that will accomplish our goals,Mr.Obama feels.

Who Obama Is:Commander-in-Chief

In a major address last week,President Barack Obama set out his strategy for the war in Afghanistan,which will be a central topic of the NATO summit the President will attend in Europe April 3-4.If anyone considered him a pacifist,they will have to reconsider in light of his firm position,which Senator John McCain(R-Arizona),his opponent in the recent election,described as a good plan.The situation in Afghanistan is becoming increasingly perilous,President Obama warned.If the Afghan government falls,the country will again be a base for al-Qaida attacks on America.The al-Qaida leadership uses the Pakistan frontier with Afghanistan to train and launch attacks.This is an international security concern of the highest order.The safety of people around the world is at stake.Afghanistan would be cast into the shadow of perpetual violence.I want the American people to understand we have a clear goal:to disrupt,dismantle and defeat al-Qaida.We must recognize the fundamental connection between Pakistan and Afghanistan.The terrorists within Pakistan's borders are a grave threat to Pakistan.They are a cancer that threatens to kill Pakistan from within.Military assistance to Pakistan is essential.To help Pakistan with the economic crisis,there must be International Monetary Fund and World Bank assistance.We must stand for lasting opportunity in Pakistan,the President held.

Health Uncle:How the Brain Ages

Beyond age 50,our brains become less impressionable.They do not encode new information as readily.This tends to make things harder to remember.It's long been said that you can't teach an old dog new tricks.Actually,you can;it's just more difficult.On the other hand,these older brains are better at organizing the information they have encoded.This is the wisdom factor.And our brains can be supported in their challenges by decreasing stress,while increasing exercise and sleep.Exercise improves the connections between nerve cells that are essential for memory.Stress hampers concentration,making less responsive older brains even more opaque.And tiredness has the same effect as stress on the brain.Consider taking a walk and a good nap afterward.This will help reduce stress and improve your memory.

EU Prepares for London

The European Union held a summit in Brussels,Belgium recently to prepare for the G20 summit in London in a few weeks' time.The EU pledged 100 billion dollars to the International Monetary Fund's reserves;seven billion to EU projects; and 68 million to non-EU members.It urged the U.S. and others to join in doubling the IMF's reserves to 500 billion dollars.President Obama will attend the G20 summit and the NATO 60th anniversary summit on April 3-4.The G20 is a group of the largest economies and emerging markets.NATO,the North Atlantic Treaty Organization, is the Euro-American defense alliance.

Man of Many Concerns

Ben Bernanke,who was widely praised for his interview on CBS' 60 Minutes,continued to express the range of his concerns to the community bankers.Current capital rules prompt banks to reduce new lending during downturns,he complained.International efforts are underway to reduce excessive pro-cyclicality in financial regulations.The Federal Reserve's actions taken last week are intended to improve private credit market conditions.We want to be sure we can move out of credit markets when appropriate.We have steps in place to shrink the balance sheet at the right time,Mr.Bernanke informed the community bankers.

Bernanke Charts Smooth Course

Ben Bernanke,Chairman of the Federal Reserve,said there is no realistic alternative to preventing large institution failure.We need to address this problem,he told a gathering of community bankers.It is an enormous problem.It creates an incentive for small institutions to grow and themselves become too big to fail.We need to make the financial system less susceptible to exuberant booms and disastrous busts.The drop in interest rates has partially,but not entirely,lessened the effects of financial turmoil.We need something similar to the regime for bank wind-downs for non-bank entities.We are generally encouraged by the market response to our credit-related tools,the central banker remarked.

OMC United

The Federal Reserve's Open Market Committee voted unanimously on policy actions,leaving the key U.S. interest rate at 0-0.25%.The markets initially rallied on the statement,but later pulled back because of its inflationary implications.When the Federal Reserve buys Treasury and agency bonds,this tends to drive up interest rates,causing inflation.It is willing to take that risk now in order to restart economic growth.The Fed essentially prints as much money as it needs;it doesn't use tax dollars for its policy actions.The Bank of England has the same power and has enacted a purchase program in the U.K. similar to the Fed's.

Fed Hard At Work

The Federal Reserve has announced a major expansion of its balance sheet in order to resolve the financial crisis.In its statement last Wednesday,the central bank's Open Market Committee said the economy has continued to contract since January.Its policy to stabilize markets and provide financial and monetary stimulus will help resume growth.Nonetheless,the Fed will carefully monitor the size and composition of its balance sheet.It is expanding the sheet in buying up to 300 billion dollars of long Treasury bonds over the next six months,plus up to 750 billion in agency-backed mortgage securities.The OMC said interest rates will stay low for an extended period.The Fed anticipates expanding the range of eligible collateral for the TALF program.It will bring its total purchase of securities up to 1.25 trillion dollars this year.The expansion of agency-related purchases is aimed at supporting mortgage lending and housing.The Fed expects inflation to remain subdued,but the risk remains for weaker growth.

Health Uncle:Diabetes Alert

March 24 is Diabetes Alert Day.It's an occasion to warn people about the extent of this chronic illness,and encourage them to be screened for it.At present,around eight percent of Americans have diabetes.Of that number,more than 25% aren't aware of it.As well,some 57 million Americans are pre-diabetic.They have elevated blood glucose levels and,if they don't make lifestyle changes,are greatly at risk of developing the disease,and may even have sustained damage from their early stage of the condition.In one study,11% of pre-diabetics came down with diabetes every year.There is no cure for diabetes.Pre-diabetics have a fair chance of delaying or even preventing the full-blown illness by losing weight,eating less sugar and fat,and exercising.Weight,heredity and age are risk factors for diabetes.Diabetes screening is part of a complete physical.Consider making that appointment today.

IMF Reserves to Grow

The G-20 ministers agreed to bolster International Monetary Fund reserves by a very substantial amount,to facilitate more lending.German Finance Minister Peter Steinbrueck and Chancellor Angela Merkel were worried about getting over-extended providing domestic stimulus.Germany was already spending 4.2% of its GDP on stimulus,Ms.Merkel indicated,responding to U.S. calls for more stimulus spending.She wanted to let the amount already pledged have a chance to work.The G-20 is a group of the world's biggest economies and emerging markets.

Progress at Horsham

The G-20 fiance ministers and central bankers achieved basic agreement at their weekend conference at Horsham,near London.U.S. Treasury Secretary Timothy Geithner said we are seeing the world move together at a speed and on a scale without precedent in modern times.We have a strong consensus on the need for both recovery and reform so that we never face a crisis like this again.The ministers agreed on the need for both economic stimulus,according to the needs and abilities of individual countries,and regulatory reform,which has an international aspect.British Chancellor of the Exchequer Alistair Darling felt there had been a significant amount of progress,a great deal of consensus.Mr.Darling,however,expressed deep concern about emerging markets and their 90 million people who could be impoverished by the financial crisis.

Hints of a Recovery

Already,there are signs of economic healing,Mr.Summers pointed out.Key credit spreads are already substantially narrower than last fall.Credit costs are declining.It is our hope that the program will create virtuous circles.The housing cycle must be contained by direct intervention by GSEs to bring down mortgage rates,and through setting of standards directed at payment relief,preventing foreclosures.Lower mortgage rates function like tax cuts.Taken together,these steps address each of the vicious cycles.They will permit the normal processes of economic growth to re-engage over time,the former Treasury Secretary and president of Harvard University predicted at The Brookings Institution.

Anatomy of a Crisis

Greed begets greed and the bubble grows,White House economist Larry Summers said.Then greed gives way to fear,and this fear begets fear.This is the paradox at the heart of fifnacial crises.What is the task of policy in this environment? We need a program that breaks and reverses the vicious cycles.The President's plan moves on jobs,credit and housing,attacking the vicious cycles.The Recovery and Expansion Act is the largest such plan in American history.Already its impacts are being felt,retaining teachers and cops,increasing take-home pay and extending health insurance.Contracts are underway for infrastructure projects.Consumer spending appears to have stabilized,and the financial plan addresses credit contraction.There are two pillars in the President's plan:first,one trillion or more for financing mortgages,student and small business loans through the TALF program,and a public-private partnership enabling banks to divest toxic assets;second,assuring that our banking system is well-capitalized and able to lend on a substantial scale,which starts with the stress test of major banks,Larry Summers noted.

Larry Summers:Circles and Cycles

Larry Summers,Chairman of the White House Economic Council,spoke last week at The Brookings Institution,a Washington think tank.Most recessions are a reaction to inflation-fighting policy,Mr.Summers observed.Others,such as the current one,are reactions to excess.Fifty trillion dollars of wealth have been lost in the past 18 months,leading to declining demand,Gross Domestic Product and employment.Fourteen million jobs have been lost.Our goal is to bring about an expansion that is fundamentally sound,not driven by excess.Without it,we cannot achieve any national goal.Sometimes the right economic metaphor becomes,not a thermostat,but an avalanche,as today.A weakened financial system creates a vicious cycle.These are not processes that are self-correcting,the President's advisor explained.

Health Uncle:Whole Grain Foods

Whole grain foods offer a number of health benefits.That's why the U.S. Department of Agriculture recommends at least three ounces of whole grains a day for most adults.That would be three slices of whole grain bread or one cup of whole grain boxed cereal,or one-half cup of cooked whole grain rice,cereal or pasta.The benefits are reduced cholesterol levels and better digestion from the fiber in whole grains;stronger bones and muscles from the magnesium;a stronger immune system from the selenium in whole grains;and B vitamins,plus iron and zinc.Consider eating some whole grain foods such as 100% wheat bread,brown rice,oatmeal or whole grain waffles today.

Pagliuca Supports the President

Steve Pagliuca,Managing Director of private equity firm Bain Capital,and a managing partner of the Boston Celtics basketball franchise,says the models to figure out risk were wrong,based on too rosy a look at data.It's really unrealistic for the pundits to demand Obama fix this now.He's throwing the kitchen sink at it.We need to have a sense of urgency,but focus and get things right.By and large,the Obama administration is doing everything right,with a good team in place.It takes time to implement fundamental change.Our forefathers knew how to live moderately.The country won't get back on track without deleveraging significantly,Mr.Pagliuca explained.Bain Capital has been in business for 25 years,and is still hiring.

The Judgement We Face

Judgement is a summary court in perpetual session,Prime Minister Brown continued.More and more children are being lured to expensively funded madrases,where they are taught to hate us.Our values tell us we cannot be fully comfortable while others go without comfort.When the strong help the weak,it makes us all stronger.These recent events have forced us all to think anew.Let us,for the future,build tomorrow today,the Prime Minister concluded.He received a standing ovation from Congress,and was personally thanked by Representative Patrick Kennedy(D-Rhode Island).Mr.Brown is a parson's son who rose to political leadership in a dramatically troubled era.

What the World Wants

You now have the most pro-American European leadership in over a century,Prime Minister Brown observed.We should seize this moment.Never before have I seen a world that wants to come together so much.How much safer everybody's savings would be if the whole world came together to outlaw shadow banking systems,and to outlaw offshore tax havens.Let us agree at our G20 summit in April rules that apply to every bank,everywhere,all the time.I am confident that this president,this Congress and the peoples of the world can come together in Copenhagen in November and reach agreement to combat global climate change,Gordon Brown told the joint meeting of Congress.

A Crisis of Irony

The very financial instruments that were meant to manage risk,turned into a global contagion,Prime Minister Brown pointed out to Congress.We win our future,not by retreating from the world,but by engaging with it.In these unprecedented times,we must educate,invent and invest our way out of the downturn.We conquer our fear of the future through our faith in the future.The lesson of this crisis must be,we must build for tomorrow today.Now more than ever,the rest of the world wants to work with America.The new frontier is that there is no frontier.Global problems need global solutions,the British leader stated.

The Application of Values

British Prime Minister Gordon Brown recently shared his views on the financial crisis with a joint meeting of the U.S. Congress.For me,Mr.Brown said,this global recession is not just to be measured in statistics.We the representatives of the people have to be the people's last line of defense.We have learned through this global downturn that markets should be free;but markets should never be values-free.The world has learned that what makes for a good society,makes for a good economy,too.These enduring values are the values we need for this time.An economic hurricane has swept the world.We are summoned not just to manage our times,but to transform them,the Prime Minister feels.

Health Uncle:Spine Preservation

To preserve your spine through old age,you must understand what the causes of bone loss are.Heavy drinking and smoking cause bone loss.So do a sedentary lifestyle,too much caffeine,salt and protein in the diet,and certain drugs such as cortisone.You must also take care of your back by maintaining good posture,lifting properly,exercising your back muscles and getting enough calcium.Women suffer the most from spinal fractures,but as men are living longer,more of them are being seen with the telltale hunched backs.It's not where we want to go,so consider strengthening your spine while you can.

Q4 Success Stories

A number of companies did manage to improve their year over year profits in Q4 2008.They include Colgate-Palmolive,Amazon,Heinz,Hershey's,Netflix and Verizon Communications.Colgate-Palmolive even raised its dividend,as did Coca-Cola and 3M.General Electric cut its dividend recently,but it is still above average at over 4%.As of last Friday,only IBM had an increased share price,of all the stocks in the Dow Jones Industrial Average for 2009.

Oversight and Threats

Oversight of the right kind does nothing but good for the intelligence community,Dennis Blair stated.I will be leaning forward on the side of consulting more,rather than consulting less.The greatest threats do lie in that convergence of stateless individuals with weapons of mass destruction.The scientist A.Q. Khan,who shared nuclear secrets with North Korea and others,is restricted by the Pakistani government,Mr.Blair pointed out.He's not the head of a nuclear lab as he was before.Mr.Blair,a retired U.S. Navy admiral,was Commander,U.S. Pacific Command,from 1999-2002.He speaks in a deliberate way and has a military haircut.The members of the House Intelligence Committee seemed to have a lot of respect for him.

A Cybernetic Problem

We need to have open discussions of some of the cyber attacks that have occurred worldwide,DNI Blair continued.This has to be a public-private partnership.The owners of most of the servers and fiber optical cables are private.I'd like to take in some business executives to work on the inside with their knowledge of the outside,the intelligence chief confided to the members of Congress.

The Flow of Info

The Army Field Manual is the standard for interrogating prisoners today.This may be adjusted pending a review of the interrogation guidelines,Dennis Blair said.Many of the same issues as at the Guantanamo Bay detention camps obtain also at the Baghram prison in Afghanistan.There are issues of process and long term detention.I think you would be pleased about the flow of information from the FBI to the rest of the intelligence community.The structure is very much in place.You see a steady improving trend.I feel sort of good about it,but I'm afraid we're missing something as we did on 9-11;but it's basically a good story,Mr.Blair told the House Intelligence Committee.

Special Access:The National Intelligence Director

President Barack Obama has planned to retire Cold War era military assets in order to save money.In consequence,National Intelligence Director Dennis Blair says we face some tough decisions about electro-optical systems from that era.Today's enemy is hard to find,easy to kill;the Cold War enemy was easy to find,hard to kill.Today's enemy requires a different kind of intelligence system.As well,we have to get the National Security Agency involved in protecting the larger body-in cyber defense,Mr.Blair remarked to the House Intelligence Committee.As DNI,Mr.Blair oversees all 18 U.S. intelligence agencies.The post was created after the 9-11 attacks.John Negroponte,the first DNI,was his predecessor.Mr.Blair has expressed concern that economic developments pose a threat to national security that even exceeds that of terrorism at the present time.