This podcast is originally published by BBC Business Matters in this link: https://www.bbc.co.uk/programmes/w172yzrs95vwc1t.
BBC’s Description:
As the conflict continues, we hear how a business tries to stay afloat in Israel, and we look into the role cryptocurrencies may have played in the financing of Hamas.
The trial of the founder of FTX, Sam Bankman-Fried, goes on in New York. We get the latest from our correspondent.
An undercover investigation by the BBC has exposed a blackmail scam using instant loan apps to entrap and humiliate people across Asia, Africa, and Latin America. We hear more about how it worked.
Rahul Tandon discusses these and more business stories with two guests on opposite sides of the world: Mehmal Sarfraz, Co-founder of The Current in Lahore, and Tony Nash, chief economist at Complete Intelligence in Houston.
With CI Markets Free, our goal is to democratize financial insights. We believe that everyone should have access to powerful forecasting tools, enabling them to make informed decisions that align with their financial goals.
Transcript
BBC
Tony, let’s bring you in on this. This is not the first time we’ve had questions about how cryptocurrencies are being used or who is using them. I suppose when we live in a world now where it’s much easier to transfer money, we’re going to have these questions, aren’t we?
Tony Nash
Sure. Yeah, absolutely. I think the way it’s being used or when it’s used for these types of activity, it’s effectively money laundering, right? They’re taking money from legitimate sources and taking it to use it for not great activity. It’s effectively almost a reverse money laundering operation. And as your guest said, they can track a lot of that stuff now, which is great. And so they can track down that money and figure out where it’s coming from and where it’s going to, which is a good thing.
BBC
Yeah. And tell me, on that point, people will point the finger at cryptocurrency saying, Oh, this is one of the problems with them. We had money laundering before. We had cryptocurrencies, didn’t we?
Tony Nash
Oh, yeah. We’ve had money laundering through all kinds of different means. As your guest mentioned, art, it’s done through real estate, it’s done through all sorts of different factors. And he said those can be harder to trace. So maybe crypto is a simple way to trace money laundering, and maybe that use is a little bit stale now, we can hope.
BBC
Tony, can I bring you in here, firstly? Because really this is a debate centered on the US. How serious do you think that Republican threat is to cut some of the funding for Ukraine in the long term?
Tony Nash
Absolutely very serious. I think I hear people saying, Don’t worry, the funding for Ukraine is going to be there. I think it really underestimates the capacity of American politicians to hold two international issues in their mind at the same time. I really don’t believe that American politicians can hold Israel and Ukraine in their mind at the same time. They can really only focus on one word at a time. I think the events of Saturday and Sunday and the ongoing events in the Middle East have really superseded Ukraine in terms of American spending, and American political opinion and media attention. I think Ukraine is, as of Saturday, it’s yesterday’s news. There may be some funding there, but I think for the most part, those days are gone.
BBC
We’ve got Tony, of course, who is in Houston. What’s the air quality like there, Tony?
Tony Nash
It’s pretty good, but don’t forget we have a lot of refineries here, so we have some days that aren’t great. The worst air quality I was in was when I was in Singapore in the Hayes, which is these days when palm plantations burn their excess palm leaves and plants. But Houston is nowhere near the Hayes.
BBC
Yeah, you’ve managed to avoid that. It’s interesting what you talk there about burning because we’re seeing that in Manout, aren’t we? There in the Amazon where the air quality is so bad because of those fires in the rainforest. Let us talk about some political developments, Tony, that are taking place in the US. That’s right. Republicans in the US House of Representatives have nominated Steve Scalise to be the chamber’s next speaker. Just remind listeners why we got into this situation.
Tony Nash
We had a speaker of the House who was fairly middle ground. He wasn’t responsive to a number of conservative representatives, and they voted to outst him.
BBC
Very good. We’re now making you a political correspondent. And this is important, isn’t it, Tony? Because at the moment, a lot of decisions, whether it’s about funding for Ukraine, etc, It’s difficult to take them until we have a speaker in place.
Tony Nash
Right, exactly. So the speaker controls the bills that come to the floor. And without a speaker, you can’t really vote on bills like that. And so it’s a big deal taking the speaker out.
BBC
Tell me, how easy is it going to be for the Republicans to agree on getting a new speaker? Because the process of getting Kevin McCarthy in place was extraordinary, wasn’t it?
Tony Nash
Yeah, I’m pretty sure Steve Scalise is already replacing. Look, it’s like a no-contest vote in the UK. And so as a person who likes representative democracy, I like my representatives to represent what I want in them. Although it’s portrayed in media as this terrible process and Republicans being not in control of their own caucus. I think it shows that Republicans are demanding that their leadership is more responsible to their voters. These guys vote out based upon when their leader isn’t useful for them anymore. I think as someone who likes representative democracy, it’s a good thing. Steve Scalise was up against another guy, and Steve Scalise is more of a middle ground representative than the person he was against. I actually think Steve Scalise is the most useful applicant for the job because he’ll make sure that legislation works. He’s very experienced. If you remember, Steve Scalise was shot probably 10 years ago while playing softball. There was a Democrat shooter, nobody holding office, but they were a very partisan Democrat, and they shot him while he was playing softball in Washington, D.C. So he’s fairly well known in the US because he went to the hospital, he almost died, and then he returned to Congress.
Tony Nash
So he’s now, I think, he should be Speaker of the House soon.
BBC
Okay, let us see how that goes for him. Tony, election coming up, of course, next year. We’ll be talking a lot to you about that over the course of the next year or so.
Tony Nash
Sure.
BBC
Those prices at the pumps in the US, President Biden really worried about oil prices going up. How significant could they be?
Tony Nash
Oh, very. I just noticed here in Texas, I think a week or so ago, petrol was under three dollars a gallon for the first time in quite a while. That definitely matters for voters. It’s still relatively high on the Coast, especially, but it matters. And so if, say, geopolitical events or other things contribute to fuel price rises, it’ll definitely impact voters. This is part of the reason the dollar continues to remain strong is the US is trying to keep crude prices down, import prices down for crude with a strong dollar.
BBC
Let us see if that policy works. I’m sure President Biden hopes that it may. Let’s move on. That was a fascinating report. They’re really looking at the way that some of these scams are operating and then the way that they’re able to access so much information about the people that they’re trying to scam as well.
Tony Nash
Obviously, people need to have security software on their phone when they can. But I think it’s really hard for a lot of people to understand how strapped many people in South Asia and Southeast Asia are. I was on the board of a microfinance firm in Cambodia for many years, and the interest rates we could charge were regulated. The number of factors around this were regulated because the ability to pay at certain income levels is very, very delicate. And so upsetting that delicate balance can really have devastating results, and obviously, as we saw here. So this is a tragedy, and these types of things obviously need to be addressed as quickly and as harshly as possible.
BBC
Yeah, definitely. Tony, do you have a copy of the Houston Chronicle in your hand?
Tony Nash
Oh, no, I don’t. Definitely not. But I was with the publication, as you probably know, I was with The Economist for several years. And so print journalism, print media generally, obviously very difficult business. I was there as things were changing quite a lot and the nature of the business and the sales were changing a lot. So not easy to keep that business going. And kudos to them for being able to pull this off, at least for now.
BBC
Yeah, at least for now, I think is the key phrase that you use there. And what about, Tony? I mean, as long as you’re reading the articles, whether you’re reading it on your phone or you’re reading it on a physical form, does it really make any difference? As long as you’re absorbing that content.
Tony Nash
As a consumer, I don’t think it matters much as on the business side of it. I think it does matter because I think when people feel something in print and they see maybe a photo of the journalist or the editorialist, I think it’s different. I think seeing it online, it’s a bit less human and a bit more commoditized. So it is different. As it changes, I think the skill of journalism, I’m sorry to say, is possibly a little bit less than it had been at the time. Maybe that’s something that has to do with ease of information access now makes it a bit easier. Maybe AI, composers makes it easier, but I think it’s different.
BBC
It is. There are a lot of people saying that my sons actually start buying a newspaper recently and then after doing it for about two days, realized how expensive it suddenly become and he has ditched that idea completely. Or he said, Can I pay for his subscription? That will not be happening. Tony, always a pleasure to have you on the program.
Tony Nash
Thank you.
BBC
Mehmal, good luck.
Mehmal Sarfraz
Thank you.
BBC
Good luck in that smog in Lahore. Hope it improves over the course of the next few weeks. That is it for Business Matters. Team will be back at the same time, same place tomorrow.