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October 2012 Issue 002 Vol. 10
THE BULL & BEAR
They’re back. +
Ethics in Management Bell-Astral Merger The Next 36 Iranian Nuclear Program
Editor’s Note Zain Alimohamed OPINION EDITOR
NEWS 4 PQ Government Cancels Tuition Hike 6 SSMU Execs React to Cancelled Tuition Hikes 7 Students Compete in Graduating Case Competition 8 Social and Environmental Ethics Integrated into Management Curricula 10 Silent Spring: The Birth of the Environmental Movement 11 Rachel Carson: Witness for Nature 12 Exclusive Interview with Cazzette
MARKETS 14 Leverage 16 Bernanke Commits to an Open-Ended Policy for QE3 18 Eyeing the Tigers 20 Bell-Astral Media 21 Capital Fight or Flight 22 Master Limited Partnerships 23 The Glencore and Xstrata Merger 24 Mercantilism is Dead
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s the midterm season looms altogether too close ahead, it’s important to take some time and reflect on the multitude of influences on our lives as McGill students. From news stories that keep you up to date on campus goings on to deeper examinations of those stories that most affect us, we at The Bull and Bear strive to bring to the fore everything you need to know, from upcoming events to developments in the global economic environment. The past month has been both eventful and capricious. This school is a living organism, constantly growing and learning and the environment within and outside the “McGill bubble” has and will continue to change. With an election that brings uncertainty and potential polarization, as well as the memories of last year’s divisive effect on the student body all too fresh in our minds, we look to the future. Our staff has worked over the last month to create an issue brimming with facts, opinions, suggestions and outlooks. Our diverse and talented writers examine, and offer personal insights into, those events and contentious issues that are vital drivers of the great student dialogue. So take a moment, relax, and find out what is going on in our school and in our world.
LIFESTYLE 26 Things That Scare You 38 Pop vs. Jock 29 Ferreira Café: Faim de Soirée 30 The Next 36 32 Eat Your (Drunk) Heart Out 33 A Decaying Society
OPINION 34 Iran: Villain or Victim 36 Ahmadinejad Power’s Nuclear Iran Against Israel and the World 38 The Real Friend Zone 39 Hot or Not
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Local Farmers Share Their Harvests
PHOTO VIA FLAVIE LALIBERTE
The McGill Farmers’ Market sets up their tents every Thursday until October 25th. Read the full story at http://bullandbear.musonline.com/2012/09/local-farmersshare-harvest-mcgills-market/
Briefs
BRIEFS
Your guide to events around campus Desautels Sports Industry Conference
McGill Conference on Global Food Security
October 12th-13th Bringing together students with an interest in sports to realize related careers. http://dsic2012.com
October 16th-18th Montreal The theme of this year’s conference is Food Prices and Political Instability.
SSMU General Assembly
McGill Open House
Monday October 15th, 4:30pm Shatner Ballroom Students from all faculties are welcome to attend.
Sunday October 28th McGill University McGill will open its doors to prospective students to showcase programs both inside and outside of the classroom environment.
McGill vs Concordia Poutine Eating Challenge
Fall 2012 Convocation Wednesday October 31st Place des Arts, Salle Wilfred-Pelletier First ceremonies begin at 10am. Second ceremonies begin at 2:30pm.
Saturday October 13th Concordia University McGill Chapter of Right to Play is competing in a poutine eating competition.
Homecoming Week October 11th-14th McGill University McGill’s Homecoming Week will host over 70 events around Montreal for students, alumni, faculty and parents.
Feel Good Fridays Friday October 12th McGill University The McGill Health and Wellbeing Program offers events that are healthy, reduce stress and achieve a sense of balance.
4Floors Thursday October 25th Shatner Building Come out to SSMU’s Halloween Party, where all four floors are transformed into a massive nightclub for the evening.
The Bull & Bear - October 2012
David Lin Executive Editor Avi Rush Managing Editor Jean Moirez Media Editor Michael Horowitz Chief Layout Editor Dan Novick Natasha Racco News Editors Fei Qi Sameer Rizvi Markets Editors April Wu Sean Leslie Lifestyle Editors
Zain Alimohamed Jessica Simmonds Vidal Wu Opinion Editors Kapil Mehra Advertising Director Olivia Siu Marketing Director Sami Jaber Henry Fuz-Keeve Diana Cheptene Web Editors Alessandra Hechanova Matthew Hunter Brian Lau Michael Tong Layout Editors
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NEWS
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PQ NEWS
GOVERNMENT
CANCELS
TUITION
HIKE New separatist government returns tuition to pre-hike levels by decree
The Bull & Bear - October 2012
Dan A. Novick NEWS EDITOR
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ess than 24 hours into governing the province, the separatist Parti Québécois government led by Premier Pauline Marois cancelled the controversial tuition hike of $1,625 over five years. The tuition hike had paralyzed the previous Liberal government for eight months as negotiations between student groups and the government failed to reach an agreement. “The increase is cancelled for this year, for 2012-13 and for the next years, we will have the discussion at a summit on education,” stated Marois in a press release on September 20th. Since mid-February, Quebec students have been protesting and striking in order to try to force the Liberal government to back down from its promise to raise tuition from $2,168 to $3,793 per year. These protests often ended in violent clashes with police. On McGill campus, the James Administration Building was occupied by protestors for a week in February for the second time during the 2011-2012 school year. Students in the Faculty of Arts voted against an ‘unlimited student strike’ at the AUS General Assembly in mid-March by a vote of 609 to 495. March 22nd saw 200,000 striking students from CEGEPs and universities across Quebec take to the streets of Montreal to peacefully protest the tuition hike. On May 18th, the Quebec Government passed Bill 78, an emergency law that attempted to manage demonstrations by requiring protestors organizing a protest of 50 or more people to submit their route in advance to police for approval. In protest of this law, which many saw as a violation of freedom of public assembly as mentioned in Section 2 of the Charter of Rights and Freedoms, between 400,000 and 500,000 people marched in downtown Montreal on May 22nd. Negotiations between student associations CLASSE, FEUQ, and FECQ and the Liberal government broke down over the summer after the associations rejected government offers to extend the $1,625 tuition hike over seven years. After the election of the PQ on September 5th, the remaining student groups on strike returned to class. Looking forward, the PQ still has to pass their first budget, and since they are a minority government, the party will need the support from both Québec Solidaire MNAs as well as seven MNAs from either the CAQ or Liberals to reach the 63 votes required. Otherwise, a motion of nonconfidence will arise, triggering another provincial election. The PQ will table their first budget next spring.
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NEWS
SSMU Execs React to Cancelled Tuition Increases In-depth discussions with Cooper and Reid-Fraser Doron Lurie
STAFF WRITER
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hether it’s the price of admission to a white collar life, the cover fee to the greatest party ever, or the cost of pursuing true academic passion, tuition fees have an obvious impact on the lives of all university students. As is often the case in matters of economics, the happenings surrounding university tuition in Quebec touched a societal nerve. Even among the moderate majority that removed themselves from the strike/ anti-strike split that rocked our campus last year, it was impossible to avoid the wide range of emerging debates on issues of class politics, the role of government in higher education, and the line between entitlement and necessity. Most recently, the newly elected PQ government under Pauline Marois has announced that the planned tuition hikes are to be cancelled. While many activists are pleased by this news, a demonstration by CLASSE on September 22nd suggests that a significant segment wishes to expand the movement to push for higher education that is completely subsidized by the government. Allison Cooper, SSMU VP Clubs & Services, has mixed feelings about the election results. “I wasn’t particularly excited about any of the big three Quebec parties personally. As an international student [Cooper is from Berkeley, California], I am especially concerned by the PQ’s racist immigration policy history.” Cooper is also dissatisfied by the province’s treatment of Bill 78, an emergency law passed in May requiring protesters organizing a protest of 50 or more people to submit their route in advance to police for approval. Consequences for failing to do so include hefty fines of up to $125,000 for student organizations. “Last I heard the potential for big fines on student associations are
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still in there, which is one of the scariest parts for SSMU.” As a result of this, Cooper seemed willing to accept the vulnerability of the freeze to the PQ’s lack of seats. “A minority government is kind of exciting, because at least it provides some checks on power. However, while I’m not completely sure about the function of a ministerial decree [the technique used to enact the freeze], it seems kind of sketchy to me.” “My personal belief is that we really need to rethink the role we give to higher education and what universities are meant to do. I feel that education is a public good that provides a clear benefit to society and is necessary for there to be an equal playing field. Education should be free and accessible for everyone,” Cooper explained. “Some people are saying that the tuition freeze has actually done a lot to hurt the bigger movement as there is now a whole branch of people that are already satisfied by the freeze when there is still so much further to go.” Last year’s SSMU took a decidedly active role in opposing the $1,625 hike, appropriating student fees to the student strike movement. They maintained their long-standing mandate to protect accessible education and re-adopted a specific motion called the ‘Motion Regarding Accessible Education’ to oppose the now-cancelled hike. “SSMU has a commitment to accessible education and finding alternative ways for universities to be funded that do not rely on student payment,” explained Robin Reid-Fraser, SSMU VP External. “There will be another motion submitted to the General Assembly on the 15th [of October] to renew that mandate. If that mandate continues, we will make it clear that we believe there should be a closer look at finding alternative ways to fund
universities.” However, Reid-Fraser is concerned that this is not the end of the story even if the freeze passes through the minority government. “I’m glad that the hike has been cancelled for now, but I’m curious to see what happens next. There has definitely been talk that the PQ is interested in indexing tuition to inflation, or having other, smaller tuition hikes instead. We’ll have to wait and see.” Proponents of a tuition increase, and austerity measures more generally, often mention that the Quebec government has a significant deficit of $1.5 billion. “But we are also in a context where levels of student debt across the country and across the world are increasing. Even in Quebec, where debts are lower than the rest of Canada, average student debt is around $15,000, and it’s reaching a point where it’s quite difficult for students to find good paying jobs and repay the debts that they owe,” she continued. “This isn’t just affecting students, but puts a damper on the rest of the economy and hurts society in general.” SSMU President Josh Redel declined to comment on the record concerning his personal beliefs on tuition fees. Considering the motion to extend SSMU’s mandate, the General Assembly on October 15th is shaping up to be an important event in defining SSMU’s stance for the rest of the year. Allison Cooper is enthusiastic about what the future holds. “We have a fun exec this year since we all come from different parts of campus.” Interestingly, every SSMU executive is from a different faculty, with Arts, Engineering, Management, Science, Environment and Religious Studies all being represented. She notes, “There will be some exciting conversations that I look forward to having.”
Aimee Pellegrino
Capital One Analyst Annika Lewis judges a team’s presentation during the Graduating Case Competition
STAFF WRITER
Dan A. Novick NEWS EDITOR
Students Compete in Graduating Case Competition
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Real-world situations test graduating Desautels students
he 2012 Graduating Case Competition (GCC), sponsored by Capital One, Sinfully Asian, TalentEgg, and the McGill Bookstore, took place on the weekend of September 28th. Thirteen teams from Desautels competed in three categories: marketing, strategy A, and strategy B. The competition was judged by representatives from Capital One, Desjardins, Deloitte, Bath and Body Works, Wire Rope Industries, and Redpath Holdings, who allocated points to each team based on certain predetermined criteria. Annika Lewis, Desautels B.Comm 2011, Business Analyst at Capital One and one of the judges, explains, “GCC is a big part of our McGill recruitment strategy. We were wowed by the quality of their presentations.” The first night of the competition concluded with a speed networking opportunity for the participants in the form of a meet and greet. This aided the competitors to not only connect with other participants, but with the judges, chairs, and professors. Capital One devised the marketing case, whereby teams were asked to allocate a $1 million marketing surplus to an advertising campaign for Capital One. Rebecca Mintz, Senior Business Analyst at Capital One, explains that the participants “had to figure out a way to spend the money in a way that was true to our brand and furthers the brand equity that we’re building across Canada.” The case presented to the teams was based on a real life scenario. Last year, four Capital One employees embarked The Bull & Bear - October 2012
on a similar endeavour. “They put us in a room, and for a month, this was our job: how to spend a million dollars in a way that justified returns,” says Mintz. “It was one of the coolest jobs I’ve worked on in my life.” Goodwill Hunters won the marketing category, consisting of Gabrielle Boulay, Joaquim Miro, Charlotte Lucas, and Eloise Charreyron. New Wave Solutions was the runner up. “They [Good Will Hunters] had the most unique idea, and, at the same time, was something that we felt we could implement,” finds Mintz. Goodwill Hunters spoke to The Bull & Bear about their solution to the marketing case. “We decided to go big or go home basically. Our recommendation was to have a TV series online: a reality show having people go around the world with different challenges, all whilst using a Capital One credit card” explains winning contestant Joaquim Miro. Their slogan was, “Around the world with Capital One.” For the strategy A category, “there was an app company that was deciding between in-house production and emerging markets, and complex versus casual games,” notes Lara Khoury, VP Internal of GCC 2012. TNM2 Group won the case, consisting of Marie Turk, Mathilde Leroy, Nicolas Popoff, and Tom Calvet. “We had financials, trends, and opportunities that we needed to evaluate,” notes winning contestant Nicolas Popoff of TNM2 Group. The strategy B case involved brand promotion in the face of negative publicity. The scenario presented dealt with a company that sold timeshares. A few of
the guests had vocalized their displeasure with the homes that they were staying in. “We called in our crack consultants and asked them what they would do to reestablish our reputation”, explains judge Larry Markowitz from Redpath Holdings. This case was won by Dream Team 101, consisting of Kyra Azzopardi, Jacqueline Moneta, Abdulkarim Al Hiraki, and Marc Bruyere. Bull & Bear Consulting were the runners up. GCC is an important part of Capital One’s recruitment strategy. “It’s something we’ve been coming to for several years now and we really like coming back,” says Lewis. “This is an awesome way for us to get ideas from students who may have different perspectives from those of us inside the company.” Overall, this year’s GCC was a huge success. Co-chairs Iris Maubon and Agathe Flourent began implementing their plan for the competition in August. “It went really smoothly. We didn’t have any problems with the organization. Because last year we were in the committee, we knew what the possible issues were that could happen and what needs to be done,” notes Flourent. The closing cocktail on Saturday night at the Faculty Club was a celebratory evening that ultimately marked the end of the rigorous competition. “Everything went really well. It was great seeing everyone happy and everyone having fun,” says Maubon. They will use their budget surplus to help fund U2CC, to be held on November 2nd and 3rd.
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Social and Environmental Ethics Integrated into Management Curricula Marcel Desautels Institute for Integrated Management seeks to include social and ecological concerns into business practices Jules Eustache STAFF WRITER 8
NEWS
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hroughout the last two decades, a wave of studies criticizing current curricula have swept through the field of management, leading to the discussion of widespread reforms throughout educational institutions. Specifically, many criticized the lack of “functionally integrated curricula in higher education,” one that is inclusive of social and ecological factors in business practices. In light of this, the Desautels Faculty of Management created the Marcel Desautels Institute for Integrated Management (MDIIM) in 2008, following a generous $10 million donation from Marcel Desautels. In 2011, after much deliberation, McGill appointed Dr. Steve Maguire to be the Institute’s first director. Today, the MDIIM is not only up and running, but incredibly active. This is seen by the recent string of events surrounding the importance of management practices in ecological sustainability, highlighted by a guest appearance by Linda Lear, the renowned author of Rachel Carson’s autobiography. The MDIIM aims to create a new generation of managers, one that is capable of appreciating multiple and diverse perspectives and subsequently integrate them together to achieve satisfactory outcomes for all parties. Students will be mentored in a fashion that instills a sense of worldliness, with emphasis on critical and integrative thinking. In addition, integrated management will stress collaboration skills, with a special emphasis on conflict resolution and tolerance for diversity. To implement this, the MDIIM has developed a comprehensive system that will spread across the educational spectrum to both students and faculty alike, through teaching, research and outreach. Inside the classroom, integrated management aims to teach students to grasp the multiple facets of any given situation, through analysis of real world management cases, business simulations, and in-depth discussions that will emphasize creativity and integrative thinking. The MDIIM aims to implement a new format of teaching through the inclusion of “multiple professors from different functional areas” to provide diverse perspectives in each lesson. The MDIIM unveiled its first affiliated The Bull & Bear - October 2012
course, MGPO 434, Introduction to Social Entrepreneurship and Social Innovation, dedicated to the inclusion of social factors in managerial strategizing and organization. Furthermore, the MDIIM will be actively facilitating the creation of more interdepartmental programs between other faculties and that of Management in an effort to incorporate social and ecological perspectives into the curriculum. Outside of the classroom, the MDIIM aims to provide a vast array of opportunities including internship and mentoring programs in industry as well as frequent opportunities to interact with accomplished managers through guest speaking events and panel discussions. Future plans include fostering studentrun enterprises and facilitating a greater number of student-run research and internships in the public, private, and
nonprofit sectors. To kick-start their mandate, the MDIIM has already hired five B.Com students to “scope out” the available teaching and research files with the aim of stimulating more students and student organizations to actively engage and participate in MDIIM associated events. Adam Halpert, the Institute’s Managing Director, gave us a glimpse of the novel Faculty Fellow Program that seeks to appoint a number of Desautels faculty members to “scope, design and implement innovative teaching, research and outreach initiatives around the MDIIM’s thematic priorities” over a two year period. Halpert also mentioned that future plans would promote more student-based research initiatives at Desautels, the funding for which could come directly from Desautels or from facilitated external agreements.
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NEWS
Silent Spring: The Birth of the Environmental Movement Marcel Desautels Institute for Integrated Management hosts Rachel Carson’s biographer
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n September 19th, the Marcel Desautels Institute for Integrated Management (MDIIM), in collaboration with The Bull & Bear and the Management Sustainability Network, held a panel reflecting on the relevance of Silent Spring, Rachel Carson’s 1962 bestseller that exposed the public to the hazards of synthetic materials in the environment. To celebrate the book’s 50th anniversary, the Institute organized a panel composed of multiple students and professors in the Faculty of Chemistry and the Faculty of Management, as well as Linda Lear, Carson’s personal autobiographer. In attendance were Rebecca Dooley (U3, B.Com), President of MUS Sustainability Club, Monika Rak, a PhD candidate in McGill’s department of Chemistry, Dr. Audrey Moores, an assistant professor in the department of Chemistry, and Steve Maguire, director of the MDIIM. Despite focusing on different sections of Silent Spring, all panel members agreed that certain themes expressed in the book were still relevant in today’s society, especially in regards to humans’ impact on the environment. Dooley’s analysis stressed the need to assess “the full scope” in managerial situations in order to adequately define who and what could be affected by certain actions. “You have to be interdisciplinary. You have to look at the business side [and] the chemical side.” In addition, Dooley noted that awareness alone was insufficient, and commended Carson for not only promoting awareness, but providing solutions too. “Awareness only brings you so far. [Carson] created awareness by giving the actions that should be taken.” Monika Rak’s response, while echoing some of Dooley’s points, was more critical of Carson’s portrayal of the
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chemical industry: “As a chemist, the book is seminal, it is well written, it is nuanced, but whenever [Carson] bring up chemistry – the way she does this is negative.” Rak felt that Carson’s book had unnecessarily demonized chemicals and the field alike: “Chemistry and chemicals are just tools for us to use – they can’t be evil or sinister.” Despite this criticism, Rak found that Silent Spring raised a key issue in managerial practice: the lack of true leadership capable of pursuing the most appropriate action regardless of its difficulty. Rak finds that the controversial use of DDT was a result of poor leadership, marked by the lack of adequate research and eventually culminating into the environmental scandal surrounding the pesticide’s use. She concluded her analysis by stating that the issue of environmental management malpractice could be curbed if politicians and scientists collaborated together in the development of policies. However,
she finds that such an interaction could prove difficult. “All scientists are basically trained not to state certainties. Unfortunately, this doesn’t make for a very good politician; politicians speak in certainties.” Dr. Audrey Moores then presented her analysis, focusing on the unfortunate power of money in dictating the direction of scientific research. Moores made reference to the recent publication by Gilles-Eric Seralini that exposed liver toxicity caused by GMO corn and described how large corporations, like Monsanto, have actively suppressed such research from occurring. Moores expressed concern that large corporations had practically unlimited funds and were capable of controlling and censoring research that may expose them. She associated this controversial activity to a lack of understanding on behalf of the chemical industry: “We learn about chemistry in the beaker, not the outside world.” In light of this, Moores suggested
PHOTO VIA NAT CARSON
Invited speakers interact with students during a round-table discussion at the Marcel Desautels Institute for Integrated Management
NEWS that the implementation of toxicity and environmental impact courses for Chemistry students could have lasting impacts on the future mindset of the chemical industry. MDIIM Director Steve Maguire was next to discuss his analysis, focusing on the “profound connectedness of all things on Earth.” Maguire emphasized that all economic activity took place within an ecosystem and that understanding that “nothing in nature exists alone” was crucial to the development of managerial practice. In the event that such understanding was lacking, or that a company was disregarding it, Maguire stressed that society could not only
Rachel Carson: Witness for Nature
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n Thursday, September 20th, the MDIIM, in conjunction with the McGill School of Environment, hosted a public lecture featuring Dr. Linda Lear. She elaborated on the impact of Rachel Carson’s book Silent Spring and discussed central themes of regulating industry in order to protect the environment. Lear spoke of how Carson, despite having been diagnosed with metastasizing breast cancer, was capable of writing such a powerful tale that not only exposed the misuse and inefficient use of new synthetic pesticides but also was a catalyst for the modern environmental movement. Rachel Carson was capable of achieving such an impact because of the large following she had already gathered from her previous books. In discussing Carson’s rise to the spotlight, Lear stresses that Silent Spring’s success was largely due to Carson’s distinguished writing career and her ability to transduce scientific knowledge to the general public; to the people, she was the “voice of science.” According to Lear, “only Carson had the literary and the science expertise necessary to write about this subject” and her positive reception was crucial in her ability to withstand the wave of attacks The Bull & Bear - October 2012
distribute the license to operate but it could also revoke it and thus, downstream consumers have influence in dictating the actions of the chemical production industry. The panel concluded with comments from Linda Lear, author of Rachel Carson’s autobiography Rachel Carson: Witness for Nature. Lear echoed Maguire’s comments on interconnectedness, and focused on Carson’s exposure of the misuse of chemistry. Lear finds that Silent Spring was truly about Carson’s fear that the chemical industry at the time had no political or economic boundaries. She spoke of Carson’s portrayal as the “voice of science” of her time, and how
that followed the publication of her book. Lear delved deeper into the aftermath following Silent Spring, stating that Carson had opened the doors to “a debate she never could have imagined or ever wanted,” the environmental debate. Those who opposed Carson not only blamed her for the banning of DDT, but also continued to blame Carson for the millions of lives lost due to malaria, where DDT had previously been an efficient pesticide in eradicating the mosquito vectors. In reality, Carson had never denied that pesticides had useful purposes, or that they could be effective in combating disease. Carson did not call for a ban on the production of DDT, but simply advocated stricter governmental regulation in the use of synthetic pesticides. Furthermore, DDT regulations following Silent Spring only banned the domestic sale of DDT in 1972, but did not ban or inhibit its exportation to third world countries until 1985. In addition, DDT had already been called into question by the WHO prior to the publication of the book, indicating that steps were already being taken to regulate the pesticide. Lear stressed that many notions had been construed over Silent Spring’s repercussions, but many were misappropriated to Carson herself. Lear stressed the fact that while DDT may no longer be an environmental threat today, Rachel Carson’s message is
the strength of Silent Spring’s impact was largely a result of Carson’s previous fame. Without her already established audience, the book’s impact could have been severely reduced, and the associated repercussions would have never occurred. The panel stressed the importance of viewing everything as an interconnected system, making multiple references to Carson’s metaphor of the “fabric of life.” As Maguire stated: “In fouling or poisoning the environment, you are in fact fouling your own home and poisoning yourself, fouling your neighbors home and poisoning your neighbour.”
still relevant. By exposing the misuse of synthetic pesticides in the 1960s, Carson was a crucial catalyst to the development of the modern environmental movement. In describing the modern relevance of Carson’s message, Lear states, “Substitute climate change for pesticides and the environmental battle remains the same as it was half a century ago.”
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Exclusive Interview
with Cazzette Alexander Björklund and co. take Montreal by storm
PHOTO VIA HRISTO VASSILEV
Henry Fuz-Keeve STAFF WRITER
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s though the EDM line-ups in Montreal weren’t enough to keep us busy, MUS goes out of their way to provide us with exclusive events. After bringing Avicii and Sander Van Doorn to our doorstep for sold out unforgettable hours of chaos last year, it was finally time for round three. Cazzette, the Swedish Dub House duo comprised of Alexander Björklund and Sebastian Furrer, was finally here to tear La Mouche to the ground. We caught up with them before unleashing them onto a Red Bull-fueled crowd dying to lose its mind. Manuella Djuric, one of the organizers of the event, explained
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that the idea of bringing Cazzette in was brought up around April. “[We wanted] to do another post-frosh show. Logistical planning started around late July and of course all the way up until the show,” says Djuric. “I wanted to get started early since I knew before the show I’d be very busy with Frosh.” I had a chance to speak with the DJs before the show. The following is a transcript of my interview. You guys had a big summer. For example, you played at Tomorrowland this year. I wanted to know how the preparation changes before playing at a huge venue like Tomorrowland and
playing at a small venue like tonight? Alexander Björklund: The preparation is the same basically. It doesn’t matter if you play for 40,000 or 400, you get as excited and always want to bring your best. Maybe for big festivals you try to premiere new tracks because they’re such big events with such a huge following. But the preparation itself isn’t that different, right? Sebastian Furrer: No it’s the same. Just new tracks, that’s the only thing you try to ensure. (Continued on next page)
NEWS
(Continued from page 12) And so which type of event do you prefer? Which do you get more pumped up about? Sebastian: I like venues with about 2,500 people. It’s not a club; it’s not a festival, but like a theatre. Alexander: It doesn’t even matter, as long as the crowd is up for it, and as I said before: If its just 400 people and everyone is sweaty and everyone is feeling it and everyone is going crazy, I die for that shit. But, of course, if you play somewhere like Tomorrowland and it’s just an ocean of people, that’s incredible. So you guys just came off your first tour in Asia. How did touring over there compare to touring in North America and Europe? Sebastian: I think the U.S. and Canada are more organized. They’ve been doing this for a while now. But Asia has been doing it for only about a year and so in the States and such it’s more routine. The crowd in Asia isn’t as used to it as much so they’re really up for it. We loved touring there. The shows were really good! Do you think the crowd knows the music as well as they do in other parts of the world? Alexander: No, it’s much newer there. You’re on a pretty serious tour at the moment, playing every night. How do you stay motivated to go out each night and rock the house? Alexander: I think that’s pretty easy actually. Sebastian: We just love it. This has been our dream since we were kids, so to be able to do this we don’t need to think, we just go out there and have fun. Alexander: Even if you’re dead from flying, room service (laughs) […] I know that sounds bad! Even if you’re tired, as soon as you step on the stage and you connect with the crowd, you forget about it. Sebastian: Ya, the crowd just pumps you up all over again no matter what.
The Bull & Bear - October 2012
Your life is just huge party after party, with lots of hard work and production mixed in, but since you get to DJ such amazing events, what do you do when you want to party really hard and you’re not DJing? Sebastian: For me, it’s not happening. When I’m off, I just try to not be at clubs and stuff. I just want to be chilling and doing nothing at all. Alexander: Since this has become such a huge part of our life, when we’re free we don’t go to clubs, just quiet dinners with friends. So then I wouldn’t bump into Cazzette in the club? Sebastian: (laughs) No not really! It sounds boring but really for us this is our work. People go to work everyday and when it’s their day off, they’re not going back to work for more. So when we’re home on vacation, we just do nothing. What is the craziest, weirdest, funkiest thing you’ve seen at a rave? Sebastian: (looks at Alexander) I think you’ve got all those! Alexander: (laughs) I just talked about this on Chuckie’s BBC One radio show about the pizza delivery in Chicago. I had a pizza delivered to the stage while I was playing. It was kind of unique to see the pizza guy walking through the crowd to the stage to give me the pizza. That was pretty unique. But you were in London, Ontario in the beginning and you saw a couple making love in the crowd, to put it nicely? You don’t see that everyday. Sebastian: That was an interesting one. Alexander: So much craziness goes down at all these shows. Everyone is so up for it! Being producers, you spend a ton of time in the studio. What’s the longest studio session you’ve ever put in? Alexander: It’s so hard to tell! Sebastian: I’d say about 8 hours straight. Alexander: It’s never longer than that really. Sebastian: You just can’t handle it.
Alexander: You have to rest your ears, and come back fresh after a break. Your ears just get dead when you’re blasting it out, especially when it’s something you’re really satisfied with. You turn it up and just (fist pumps), dance in the studio basically. You guys are well known now and have a genre that you’re associated with. Do you ever feel restricted when you go on stage, like people expect you to play a specific genre? Sebastian: (emphatic) No. Not to sound cocky at all, it’s not like that, but we don’t care. We just play whatever we want, and if people like it, that’s good. We are here to play what we like and what we think the people will like no matter what genre. We’re here to play our show. Preparing for a set, do you know all the music you’re going to play that night going in, or do you choose based on the crowd? Alexander: You have to feel the room. You never know what you’re going to end up playing. Maybe you have a particular mindset going in, and you think the night is going to go a particular way and then you quickly realize ‘oh shit,’ this isn’t working at all and you gotta switch it up. And you go totally off your plan. Sebastian: It depends on the venue. At festivals you can play as hard as you want. You can just bang it out. Alexander: In clubs you need to be much more careful. You need to make sure you play energetic. You gotta really think about the audience. Can you tell me a DJ you’d like to perform alongside with that maybe you haven’t gotten a chance to meet yet? Sebastian: It’s hard. There are lots of DJ’s I’d like to produce with, but as for playing with, I’m not sure. I’ve never really thought about it. Alexander: I guess it’d be pretty cool to play a back-to-back with Daft Punk, but I don’t think that’s ever gonna happen.
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MARKETS
Leverage
A Tale of Three Traders
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Leverage is a tool, and like any tool, there is a right and wrong way to use it.
Maxime Riahi STAFF WRITER
L
everage is easily one of the most misunderstood concepts in finance. Leverage essentially allows you to control a certain sum of money using little or none of your own. The prevailing perception is that increasing leverage increases risk. This is wrong. Leverage is a tool, and like any tool, there is a right and wrong way to use it. Using leverage to take excessive and reckless risks tends to be more often used by amateur traders and is what gives leverage a bad reputation. You basically take other peoples money (OPM) to finance a position you want to put on. If you are right, you get paid, and if you’re wrong, you lose big. So what is the right way to use this fantastic tool? If used properly, leverage can allow you to trade the same amount of money you would normally be trading, at a significantly reduced price. Essentially, we are reducing risk. Leverage works like this. In a normal
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situation (say at the grocery store), $1 in your wallet gets you $1 worth of food. This is leverage of 1 to 1 (1:1 or 0%). Well, what if the grocery man lent you $10 to buy food, and you just had to put down $1. With your $1 you can control $10 (your $1 and his $10). Your money is leveraged 10:1 (or 10 to 1). In markets like the Foreign Exchange, you can find anything from 2% leverage to 400% leverage depending on the broker you use. The following example illustrates three dramatically different approaches of using leverage in trading.
Exhibit 1 Reckless Rick Rick likes it hot. He likes to feel the blood rushing through his veins. The thrill of
the hunt is what Rick is after. Rick has a $1,000 account leveraged 100:1. Rick can control $100,000 with his trading account equity (every $1 is leveraged 100 times). Rick wants to go long EUR/USD. He wants to limit his risk to 1%, so if price goes against him by 1%, he will exit his position. Rick decides to bet the whole $1,000 on this trade to take advantage of the huge amount of money he can now control. If price moves up just 100 basis points (1%), Rick will double his account equity. That is a 100% return on a 1% price movement! This is the glamour of leverage. And also the pitfall. The road to easy riches and quick gains alludes traders like Rick into thinking they will get rich. What if price goes against Rick and he is forced to exit his position? Rick loses a 100% of his equity and is out of the game. Bye-bye Risky Rick. Better luck at the casino. Lesson: The retail foreign exchange market is loaded with beginners and
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professionals (think Merrill lynch, Barclays, Solomon Bros, Lehman, Goldman) alike who have blown up their trading accounts because they had an incomplete understanding of leverage and risk. This misunderstanding leads to overleveraging. A couple of bad trades (or even one) in an over-leveraged account will lead to a wipe out. FEAR NOT FRIENDS, WE SHALL CONQUER THE LEVERAGE DRAGON!
identical $1,000 trading account like Phil and Rick and uses the same 100:1 leverage as Rick. Like Rick, Allen can control $100,000 in currency through leverage. If Allen risked his entire account in one trade, he too could get lucky and double his equity. But Allen isn’t that stupid. He is not mesmerized and disillusioned by the possibility of huge rewards. Rather than using leverage to increase his rewards, Allen uses leverage to reduce his risk. Here’s how: Using 100:1 leverage to his advantage, Allen can control his original account equity at a much cheaper cost. Allen risks 1% of his equity per trade ($10). That 1% risk leveraged allows Allen to control his original $1,000 with just $10. Essentially, Allen is managing the Phil is boring. Phil is scared. same amount of money as he normally Like Reckless Rick, Phil does not would, but at 1% of the cost, by using understand the power of leverage. Because leverage. Leverage ain’t so bad you see. of his lack of understanding, he stays as When we met Phil we said that his far away from it as possible. He uses a trading style was actually RISKIER than leverage ratio of 1:1, otherwise known as, Allen’s. Let’s see why that is true. When none at all. Like Rick, Phil has an identical Phil wants to put on a $200 position it is $1,000 account. For every dollar he trades, he has to put in $1. Compare that to Reckless Rick who only had to put in $0.01 for every dollar traded. Phil thinks he is being smart and conservative by taking less risk. But is Phil really taking less risk? No. He does not understand risk. Phil is avoiding risk, and that alone is quite risky. Let’s see why. After meeting Exhibit 3 we will try to understand the hidden riskiness BUSINESS CARDS of Phil’s strategy. Phil’s type of trading is best suited for stock trading. It’s a very Now Available at Dave’s slow path to wealth, but maybe he will get there when he has great-grand children. Bronfman Basement
Exhibit 2 Spineless Phil
going to cost him $200 (1:1 leverage), but for Allen the cost is $2 (100:1). Since both traders have $1000, they are limited in the total amount of trades they can make at once. If each position is worth $200, Phil can only put on 5 trades at once (5 x $200 = $1000 equity) while Allen can put on 500. I’m not trying to show that you can put on 500 trades at once, the point is that you tie up more of your money per trade when you don’t use leverage. Phil is very limited in his trade opportunities because he can potentially only take 5 at once. Allen doesn’t care at all because 500 is more opportunity than he’ll ever need. So the point of the Tale is that we have Rick, who uses leverage recklessly to maximize his profit performance. Than we have Phil, who doesn’t get anywhere even if he makes great trades because he is using no leverage at all. And then Allen, who uses the leverage available to him to minimize his risk while hopefully making a good profit.
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Exhibit 3 Awesome Allen Allen has a decent understanding of leverage. Leverage allows Allen to effectively reduce his risk. Allen probably won’t make money as quickly as Reckless Rick, but he is ok with that because he knows that trading isn’t about quick gains, it’s about staying in the game long enough to catch the big juicy trades. Allen has an The Bull & Bear - October 2012
A deal so good, it’s like getting away with murder 15
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Bernanke Commits to an Open-Ended Policy for QE3 PHOTO VIA WIKIMEDIA COMMONS
QE3 Explained Jonathan Craske STAFF WRITER
B
en Bernanke, Chairmen of the Federal Reserve, has spent much of the last several years in the spotlight of scrutiny of the American economy. With his most recent announcement of round 3 of quantitative easing, it seems as though he is not yet ready to forfeit his place on centre stage.
What is Quantitative Easing? QE3 is the third round of Quantitative Easing being issued by the Federal Reserve (Central Bank of the United States). Quantitative easing is effectively a process of stimulus in which the Central Bank purchases bonds and other interest bearing securities from the open market on issuance of credit. Typically, this has two fundamental effects. The price of bonds are forced up by heightened demand, thus driving interest rates down. Under Keynesian economics,
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these lower interest rates are essential for encouraging lending and borrowing in a stagnant economy. Moreover, it is a form of stimulus that effectively prints money. As mentioned, the securities are purchased on credit. However, because the purchaser is the Central Bank, this credit isn’t backed by anything fiscally tangible, but rather by the ability of the US Economy to create wealth. Money is therefore injected directly into the economy as a form of stimulus. This tends to devalue the currency, and often has the effect of increasing rates of inflation.
The Significance of QE3
September 13th saw the Federal Reserve pass QE3 in a vote of 11-1. Although the rumor mill had been turning for weeks leading up to its release, few could have anticipated just how remarkably different this new round would be for the Fed. QE3 is structured on 3 underlying
components, the first of which is the continuation of the “Operation Twist” policy carried over from QE2. This policy was essentially the sale of short term bonds for the purchase of long terms bond to the tune of $45 Billion a month. QE3 notably extends the policy through until the end of the calendar year. In addition, the Feds announced plans to purchase $40 Billion in Mortgage Backed Securities (MBS) per month for the same extended period through December of this year. This will be a continued effort to lower effective mortgage rates. The figure of $340 Billion in purchasing, at $85 Billion per month over 4 months, is seemingly modest when compared to past rounds of QE (QE2 included over $850 Billion in treasury purchases). The most crucial component, however, is the open-ended term on which the Fed has issued QE3. Bernanke has made it clear that unless there is a significant turn-around in the US economy over the course of the next 4 months, MBS purchases will continue for as long as is deemed necessary with the distinct possibility of raising the cap above $40 Billion. Moreover, the plans
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outline a pledge to keep interest rates extremely low (hovering around 0.25%) well into 2015, tacking on an additional year to the term outlined in QE2. This is the first time the Fed has committed to lower interest rates beyond purchasing plans.
Bernake notes that the priority of QEs lies with both price stability and maximum employment
Reception and Predictions
shows a jump that is significantly dwarfed by those associated with QE1 and QE2. This is especially noteworthy when considering that the unlimited nature of QE3 was well out of the scope of predictions leading up to its release. With the long term stability of the US dollar now in question, investors will likely be looking to capitalize in one of two ways. While the most direct is a substantial reduction in US Dollar holdings in favor of currency set in a commodity focused market, many are cautious given the uncertainty looming
In an unlimited commitment to QE3, the federal reserve has taken an earnest approach to improving the labour market. “The Fed is going use all the power it can muster to return the U.S. economy to noninflationary full employment,” notes Dr. Sherry Cooper, Chief Economist with BMO Financial Group. However, while the US Employment figures will no doubt invade headlines for the coming months, it is the “noninflationary” qualifier that has many analysts talking. Bernanke explicitly notes that the priority of QE3 lies with both “price stability” and “maximum employment.” QE3 allows the Fed to assume a reactionary position with respect to inflation. If the US Dollar were to devalue, the unemployed would be the first affected in the fragile consumer market. However, if the dollar were to strengthen, manufacturing sectors would have tremendous difficulty keeping growth figures out of the red. Bernanke claims that the open-ended nature of QE3 will allow the Fed to limit inflation by withdrawing its policy and shrinking its balance sheet in a “deliberate and orderly way.”
in Europe. With the Euro out of the question, expect substantial attention from FX traders to be directed at Canada and Australia. For those unwilling to venture into the currency market, investors can shore up portfolios with securities in substantial multinationals. A diversified operations base, and subsequent revenue stream, will limit vulnerability to the effects QE3 will likely have on domestic labour, manufacturing, and inflation. scale, so let us dominate at home.”
What This Means for the Investor Short-term response to QE3 has been largely underwhelming. A look at market performance in the days following Bernanke’s announcement The Bull & Bear - October 2012
PHOTO BY MATTHIAS HAAS
Is QE3 synonymous with money printing?
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Eyeing the Tigers
The Rise of the Philippines and Indonesia Ethan Belmonte STAFF WRITER
I
n 2005, Goldman Sachs proposed a list of the Next-11 countries; eleven successors to their 2003 “BRIC” (Brazil, Russia, India and China) hypothesis of nations that they predict to become the largest economies in the 21st century. Among the N-11 were two of Southeast Asia’s current rising stars – the Philippines and Indonesia. HSBC shared similar bullish sentiments in their January 2012 report The world in 2050. The British financial services giant boldly forecasted the Philippines to have (in year 2000 US dollars) the 16th largest economy in the world by 2050, a 1418% climb from its 2010 GDP of $112 billion USD to a staggering $1.7 trillion USD. Using the same methodology, the global bank predicted Indonesia to have the 17th largest economy by 2050, a 448% increase. To put these numbers into perspective, the report sees China’s economy to expand by about 622%, Canada’s economy by 156%, the US’s economy by 93%, and Japan’s economy by 28% by the year 2050. Why are analysts so upbeat on the growth prospects of these two South East Asian nations, despite historical cases of political instability and poor infrastructure?
Improving political climate Since current president Benigno Aquino III was elected in June 2010, the Philippine government has increasingly made movements towards curbing corruption and inspiring investor
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confidence. A recent survey of 826 company executives by the Social Weather Stations revealed a significant spike in the Office of the President’s net sincerity in fighting corruption rating, from a bad -37 in 2009 to an excellent +81 in 1H 2012. While Indonesia has also progressed in its quest to eradicate corruption and increase transparency, fraudulence among authorities is still a key issue, leading government spending to fall short of targets and creating road bumps in developing infrastructure. Indonesian President Susilo Bambang Yudhoyono has initiated the Acceleration and Expansion of Indonesia’s Economic Development Master Plan (MP3EI), which calls for more PPP (public-private partnerships) to help facilitate the improvement of infrastructure.
Expansion of population, consumerism and industry
September 13th saw the FedRapid workforce growth is the obvious linchpin in driving economic progress in the two nations. With a combined population amounting to nearly 10% of Asia’s total, both countries are also getting younger. According to a New York Times article, “about 61 percent of Philippine population is of working age, between 15 and 65. That figure is expected to continue increasing,
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Favourable macroeconomic conditions have rendered both countries attractive areas for foreign investors.
which is not the case for many of its Asian neighbors, whose populations are aging.” This, coupled with vast improvements in infrastructure, have led to the emergence of a new, larger middleclass, and in turn, a rise in domestic consumption. In Indonesia, domestic consumption already constitutes about 60% of the country’s GDP, providing it with some protection from global fluctuations in supply and demand. Aided by local purchases of goods and services, consumer-focused firms, led by Unilever Indonesia, posted strong earnings in 1H 2012, according to an article in The Jakarta Post. Historically, the Philippines has had a very strong services sector, comprising almost 60% of its GDP in the first semester The Bull & Bear - October 2012
of 2012. The sector’s robust performance can be attributed to remittances from over 10 million “OFWs” (Overseas Filipino Workers) and an increase in BPOs (Business Processing Outsourcing). As of this year, the Philippines has surpassed India as the world leader in revenues generated from call-centers, fueled by a 24% y/y expansion of the country’s ITBPO industry. Looking forward, analysts at Deutsche Bank foresee an expansion in manufacturing, one of the nation’s weaker sectors at a 50-year low of 31% of GDP. These claims are made on the basis of rapidly expanding capacity in various industries, coupled with government policies offering sizable tax incentives to stimulate sector growth.
Surging Investment
Indonesian President Yudhoyono’s increased measures to woo investors have begun to take effect. Earlier this year, the nation won credit rating upgrades to investment grade from Moody’s and Fitch. Furthermore, as of September 2012, the Bank of Indonesia has maintained its record low 5.75% benchmark rate, encouraging investment in higheryield asset classes such as stocks, commodities, and properties. This year, the Philippines also received credit rating upgrades – from S&P and Moody’s, to one notch below investment grade. Barclays Capital Ltd. economist Prakriti Sofat sees the 7,107-island archipelago receiving yet another upgrade in the next six months. The country’s stock market’s performance has mirrored this bullish outlook, climbing 21% YTD – good for the second-best performing exchange in Asia. A key limitation in maintaining foreign investment, however, is the relatively small market capitalization of the two countries. At the end of 2011, Indonesia’s market cap was a mere $390.1 billion USD, and the Philippines’s cap was even smaller at a meager $165.2 billion USD. Political resistance and red tape, particularly in the mining industry, are significant issues holding the two Tigers back from tapping into rich mineral resources. Also, the dependence of their exports on China, which in 2Q2012 experienced its lowest growth rate in 3 years, could hamper growth and disrupt the trade balance in both nations. While there are several obstacles threatening to slow down the surge that the Philippines and Indonesia are experiencing, the legs are there, and the story is good. Favorable macroeconomic conditions and countless opportunities for growth have rendered both countries as attractive, stable areas for foreign investors to consider. Only time will tell if the trend continues.
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Bell-Astral Media
Bell to acquire Astral Media inc. George Cope, President and CEO of BCE Inc. and Bell Canada Ian Greenberg, President and CEO of Astra Media
What the merger means for consumers
PHOTO VIA CNW GROUP/BELL CANADA
Andrew Marcovitch STAFF WRITER
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hat exactly is going on with the Bell-Astral merger? Simply put, Astral Media and BCE Inc., Bell’s parent company, are awaiting approval for the merger from the CRTC. In recent weeks, the deal has received heavy media attention; particularly relating to possible ways in which the merger may be anti-competitive. Bell’s largest competitors, Rogers, Telus and Quebecor are having a field day with the media in an attempt to portray Bell as a self-made monopoly. Here is a breakdown of the two sides. Bell’s bid to takeover Astral Media for $3.38 billion does not sit well with rivals. The takeover would leave Bell with around 90 TV stations and over 100 radio stations. Rogers, Telus and Quebecor are calling for the merger to be blocked, on the basis that it is anti-competitive in nature and will seriously harm them as industry
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players. On the other hand, Bell is vying to convince the CRTC, and the public, that this merger is integral to Bell’s growth plan and would allow the firm to compete internationally in the media industry. How should you as a consumer fare with all this? Bell all the way! Surely, anti-competitive mergers are not good for society. But the Bell-Astral deal is not as anti-competitive as the rivals like to make it seem. In reality, claims by Rogers, Telus, Quebecor and others are, for the most part, unsubstantiated. These companies are essentially fighting a PR driven war against Bell; they will publicize anything, at any cost, in an effort to save their own as***s. Regardless, the Bell-Astral merger will benefit consumers. Essentially, the strategy behind this deal is to give enough size to Bell, that will allow it to compete with big U.S. content firms: Netflix, Apple and Amazon on Canadian home
turf. Bell would be able to secure more quality content, which would be made available to Canadian consumers. The company has indicated that it plans to launch a Canadian-born “Netflix-style” online streaming service – this merger will provide Bell with access to enough content to make the streaming service a reality. In the media business, the largest firms usually benefit from competitive advantages. In order for Bell to become a multi-national media company, it needs to expand its base. Canadian companies have almost no presence in the global media landscape. Bell, after acquiring Astral Media’s content rights and distribution outlets, will be a viable candidate to expand beyond Canada’s borders, while serving the best interests of Canadians. BCE chief executive George Cope puts it best: “We’re small by world scale, so let us dominate at home.”
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Capital Fight or Flight How Long Until They Call It Quits? Michaela Hirsch STAFF WRITER
I
f you’ve been successful, you didn’t get there on your own,” Obama stated on July 13th whilst completing a two day tour through Virginia and Pennsylvania. Obama is right; somewhere along the way, successful businesspeople have sought help, be it from a grade school teacher, their parents, or the government. We are thus indebted to those that have aided us in our success. In the case of the government, this compensation takes the form of taxes. The age-old question-- how much of our success do we truly owe in the form of taxes?—has been the epicenter of concern during the current U.S. presidential campaign period. Obama believes in taxing the wealthy to provide social services and create public sector job growth, while Romney espouses a top-down approach, which Obama has mockingly dubbed “Romney Hood.” Across the pond, newly elected French president, Francois Hollande, has raised the income tax rate to 75% on income over 1 million euros. He believes that this will help lower the government deficit, in The Bull & Bear - October 2012
addition to “spreading the wealth” in a place where income inequality is growing. Sounds like a good idea, but herein lies the problem: France is only a hop, skip and a jump away from Monaco and Belgium and a slew of other countries where the tax rate is lower and the business environment is better. That brings me to a place a little closer to home: Quebec. With Pauline Marois at the helm and plans to raise both taxes and royalties on natural resource firms underway, business leaders are on edge. Quebec’s tumultuous and unsteady political environment, growing language barriers, and now uncertain business regulation is creating fertile ground for capital flight; entrepreneurs, investors, and wealthy individuals will seek out a place where the risk-return profile for their investments, time and capital is the most attractive. What do the United States, France, and Quebec have in common? I believe that they are presently at a crossroads; the United States, whose growth has
historically been driven by innovation, entrepreneurship and private capital, is not the global powerhouse that it used to be. If the public sector captures a larger piece of the GDP pie, we can expect a slow capital drain, in addition to the brain drain that typically accompanies it. The repercussions of Hollande’s policies are already materializing, as France’s wealthiest man, Bernard Arnault, recently filed for Belgian citizenship. Quebec is not far behind; some investors and business owners will begin packing up their bags in search of a better business environment. In the past, human and investment capital has flowed from around the world to places that represented freedom and economic opportunity. It is beginning to look like capitalism and entrepreneurship, two things that have created wealth, raised living standards, and increased individual liberty, are set to lose. How long until people pack up and leave? On the back of a debilitating recession and a weak global recovery, it is a dangerous line we are flirting with.
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Master Limited Partnerships An Alternative Asset Class for the Income Investor Colton Dick
STAFF WRITER
A
s yields plummet and inflation seems ever more imminent, American investors are flocking to various securities that promise higher yields and consistent income. One such asset class is the Master Limited Partnership (MLP). MLPs are relatively new and structurally complex securities that combine the liquidity of a public traded security with the tax benefits of a limited partnership. Shares of an MLP are called a “unit”, while investors are respectively called “unitholders”. Each unitholder is entitled to a share of the income stream generated by a MLP. To qualify for MLP status, the partnership must generate at least 90% of its income from activities relating to commodities, natural resources, or real estate. These activities can include exploration, mining, refining, transportation and storage, but do not include retail sales of resources. Most MLPs are structured as mid-stream energy pipelines, as they are the least sensitive to commodity fluctuations, have relatively inelastic demand, and strong operating leverage. As a result, these midstream MLPs have the most consistent cash flow. MLP owned entities, not the MLP itself, own the underlying assets and conduct business operations. As a result, taxation is treated on a pass-through basis. As a result, all tax items are distributed to the investor to be taxed at their individual rates avoiding double taxation. If the unitholder’s partnership income is negative, then the loss is considered a passive loss and can’t be used to offset income from other sources. It can only be used to offset income from the same MLP in the future. Since the MLP avoids
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paying corporate tax they inherently have a lower cost of capital. This gives MLPs a competitive advantage when acquiring assets and pursuing growth strategies. The distributions paid by MLPs are also very similar to dividends. Cash distributions are based on distributable cash flow (DCF),
The biggest tax advantage for the investor is the treatment of distributions of capital. Between 80% and 90% of distributions are classified as Return of Capital (ROC) and is thus tax deferrable until liquidation of the investment. Furthermore, the ROC component also
As prices fall, yields rise and MLPs are left with more liabilities, less cash flows. which is net earnings plus depreciation minus maintenance capital expenditures. It is important to recognize that these distributions aren’t guaranteed.
Ticker
Name
EPD
Enterprise Product Partners LP Kinder Morgan Energy Partners LP Buckeye Partners LP Alerian MLP ETF
KMP
BPL AMLP
reduces the original investment’s cost basis. For example, if $10,000 is invested in a MLP with an 8% yield, the annual distribution will be $800. If 80% of that
Price ($) 53.60
Dividend YID Yield Return 4.85% 19.90%
82.50
5.96%
16.44%
47.97
8.65%
20.42%
16.57
6.02%
1.16% DATA VIA BLOOMBERG
MARKETS distribution is ROC and the income tax rate is 35%, then the unitholder will only be liable for tax on $160. This results in an after-tax yield of 7.4% compared to 5.2% if ROC was not tax deferrable. Some investors consider these special taxation policies to be more of a burden than they are worth. Although MLPs have complex tax treatment policies this investment class still offers an attractive yield, considerable growth potential and low correlation to other traditional equities. Unfortunately, the tax benefits described above only apply to American citizens. Canadian and other international residents will find the treatment of taxes difficult to incorporate within their existing tax structure. Some countries, including Canada also impose a penalty if the unitholder fails to acquire a clearance certificate when exchanging units in accordance with CRA requirements. For non-Americans and others who don’t want to deal with this increase in liability, the best option would be an MLP ETF such as the Alerian MLP ETF (AMLP). Unfortunately, this negates the aforementioned tax benefits as exchange traded funds are taxed at corporate rates while management fees and other expenses reduce overall returns. Attractive dividend yields don’t necessitate an immediate buy. Further fundamental research is always needed, especially given the flow-through nature of MLPs. It is important to know if the MLP is actually generating significant cash flow or is just returning capital. Specific metrics to look at are consistency of dividend payouts, accretive growth strategies, leverage and its distribution coverage ratio (which should be ≥ 1:1). The biggest risk associated with MLP investing is the constant need for capital to expand. As prices fall, like in the 2008 credit collapse, yields rise, and MLPs are left with more liabilities and even less cash flow to pursue growth as overall capital outflows increase. With the Fed committed to a low interest rate fiscal policy and quantitative easing, it becomes more and more difficult to find income investments which offer a respectable yield that don’t come with substantial risk. With yields between 5% and 8%, and relatively low risk, master limited partnerships and their respective ETFs are a great addition for the individual investor’s portfolio. The Bull & Bear - October 2012
The Glencore and Xstrata Merger Larger than life Alan Liu
STAFF WRITER
C
orporations such as Apple or Wal-Mart are recognizable to nearly every individual, but few would know companies such as Glencore or Xstrata, which are responsible for the production and distribution of the resources used to make our everyday goods. The former is a Swiss company that ranks as the world’s largest commodities trading company, while the latter is a large Anglo-Swiss mining corporation with operations across 19 countries. Glencore, having a 34% stake in Xstrata, initiated their merger back in February to form the largest deal in mining history. The result, if approved by 75% of Xstrata shareholders excluding Glencore, would result in the creation of a mining and commodities giant with annual revenues exceeding $175 billion. Luckily for Glencore, BlackRock World Mining Fund, then second largest shareholder in Xstrata, approved of the merger. Complications arose when the Qatar Investment Authority, the petroleum-rich nation’s sovereign wealth fund, became the new second largest shareholder of Xstrata and rejected Glencore’s offering of 2.8 shares in the new company for every share owned in Xstrata. To appease shareholders, an offer of 3.05 Glencore shares was offered but has yet to be accepted by the Qataris and other large holders. Despite the take over of the company, the future does not look bleak at all for Xstrata CEO Mick Davis and other executives. A generous $16 million termination fee, down from the flabbergasting original $50 million, is being given to Davis, provided he stay with the company for six months as interim
CEO while power transitions to Glencore CEO and South African billionaire Ivan Glasenberg. In addition, $200 million is being set aside for retention payments to Xstrata’s top executives to ensure they will not leave the company. It comes as no surprise that these lavish compensation packages were the subject of heated debate that almost resulted in the merger falling out completely. The rationale behind these large compensation packages is that these executives have intimate knowledge on the functioning’s of the Xstarta’s operations and are essentially vital for the company to continue operations flawlessly following the merger. Should Xstrata merge with Glencore but lose its leading managers, the company would essentially be lacking the people that know how to run it, which may lead to catastrophe. For now, the fate of the merger lies within the decision of the Qataris, whom alone have enough stake in the company to overturn the merger. Another topic of concern would be the approval of the merger but rejection of the retention compensation, which could result in the potential departure of some high management officials in Xstrata. Even so, should both the merger and compensation be approved, the CEOs of Glencore and Xstrata have made no effort to hide their interest in buying out the rival mining giant: Anglo-American. Should such a merger occur, the mining industry would be agglomerated into a handful of corporate giants with the potential ability of price controlling – something that would not bode well for the resourcehungry emerging nations.
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MERCANTILISM
IS DEAD
Long live comparative advantage
Alex Petralia STAFF WRITER
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hy does specter of a failed economic doctrine continue to haunt political discourse? Mercantilism was a set of prevailing economic beliefs during the 16th to 18th century that, among other ideas, stressed the importance of accumulating a trade surplus against foreign nations. It was argued, the more wealth a country accrued, the stronger it would become. International trade policy was therefore unquestionably straightforward: increase exports and reduce imports. Then came Adam Smith, who in 1776 published his seminal Wealth of Nations, effectively toppling mercantilism in one fell swoop. Productivity growth enhanced the standard of living in a nation, Smith
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wrote, not the accumulation of wealth. When firms are more productive, they are able to produce more output with less input, and given scarce resources in the
producers access to cheaper inputs than they would find domestically. Why would goods be cheaper abroad? Comparative advantage, explained economist David
Mercantilism died—with it, the belief that a trade surplus was reflective of a nation’s economic health. world, this is good for consumers. Ricardo in 1817. Some countries are better One way to increase productivity is to at producing things than others, so they engage in international trade, which gives shouldn’t waste their time and resources
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producing things they’re not good at— just import it and instead produce more of the things they’re good at. Efficiency is maximized, productivity increases and everyone is better off. Thanks to Smith and Ricardo, mercantilism died—with it, the belief that a trade surplus was at all reflective of a nation’s economic health. Unfortunately though, the idea that a trade deficit somehow is has stubbornly lived on. Of course, this misses the point. The trade deficit is just a statistic, influenced by so many factors that, by itself, it has no
implies job losses to China or deep indebtedness to the rest of the world are sorely exaggerated. When the U.S. loses jobs to China, it’s not losing them in sectors that the U.S. is comparatively strong at, like technology and services. No, it’s losing them in sectors that are inefficient, like manufacturing. And these job losses are good—yes, good. Keeping these industries on life support, often through protectionism, comes at a cost: consumers pay more for goods that could have been produced more cheaply abroad. Resources that could have been used in
The trade balance reflects nothing about productivity growth because it ignores how the money is used. meaning. What if the U.S. imports $100 in goods—does it mean it has to export $100 back out? No: the $100 could be consumed by Americans directly, or used as inputs to produce $150 of goods which also is consumed entirely by Americans. The deficit increases by $100, but this reveals less about productivity growth in the U.S. than it does about consumer demand and saving. Or, consider the dollar appreciates because foreigners demand more of the currency for its “safe haven” value. U.S. goods become comparatively more expensive in the world, which decreases exports and increases imports. Due to the national balance of payments identity, however, a growing current account deficit is equals a growing capital account surplus. That is, the more the trade deficit widens, the more foreigners are lending to or investing in the U.S. This capital can be used for productive investment—it can also be used for consumption by the American public. Examples underscore one fundamental point: the trade balance alone reflects nothing about productivity growth because it ignores how the money is used. So the fears that a U.S. trade deficit The Bull & Bear - October 2012
productive sectors are squandered in inefficient ones, often even, on lobbying to keep them alive. Like the ubiquitous zombie firms of Japan’s “lost decade,” it’s better to let them go bankrupt than continue to waste resources on their unproductive investments.
Then there’s the concern that the U.S. is losing money from interest payments on foreign-held debt—money that could have been used to invest in America. It’s a plausible idea until, as Paul Krugman wrote, one realizes that the U.S. too makes money on investments abroad. While American firms are earning moderate rates of return on their subsidiaries and assets abroad, foreigners are earning paltry returns on the huge stock of Treasuries they own. The difference in amount earned and amount paid is known as net investment income, and this has been consistently positive in the U.S. for over a decade. It’s unsurprising, then, that the trade deficit is a popular buzzword among politicians. The trade balance is affected by a multitude of economic factors, such as domestic consumer demand and foreign direct investment, and any change in these variables will be reflected in the balance. Politicians capitalize on the ambiguity of a trade deficit, often ignoring the problems that lay in the underlying variables themselves, in order to advance their agendas. Until we recognize what the trade deficit actually is—nothing—we will continue to be misinformed about public policy prescription by our representatives.
PHOTO VIA BLACKCOMMENTATOR.COM
What does trade deficit actually tell you?
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The Wadi Mujib hiking trail.
Things
That
Scare
YOU The time I was tricked into facing my fear by a Facebook sidebar ad Majd Steitieh STAFF WRITER
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PHOTO BY MAJD STEITIEH
Y
ou know those people that are a little scrawny? The ones that yell “Ouch” when you poke them lightly? The ones that get scared by the lamest things? Surely you must know by now what type of people I’m talking about. Well, imagine putting a scrawny person on a bus to a place like Mujib Nature Reserve in Jordan. Bordering the Dead Sea at 416 meters below sea level, the Mujib Nature Reserve surrounds Wadi Mujib, a deep and majestic canyon that cuts through the rugged highlands and drains into the Dead Sea. Now let me just highlight a few words: scrawny, canyon, Dead Sea, 416 meters below sea level. Notice how the first word doesn’t exactly fit in with
LIFESTYLE the others? But somehow, one frightened person took part in the trail and somehow survived! This is that person’s story… It was an ordinary Saturday morning. I woke up at 6am, checked my Facebook for way too long, and watched the trending videos on YouTube - those dancing cat videos never get old! But amongst the ordinary, something very extraordinary happened – a sidebar ad told me to go to Wadi Mujib. At first I thought to myself, “No, don’t do it, it’s a fake ad.” If you’ve ever been in the ‘Congratulations! You’re the 1,000,000th visitor to this site’ situation, you’ll know what I was going through. You know you’re not supposed to listen to that little voice in your head saying, “What if this is legit?” For some reason I did. 3 hours and $90 dollars later, I was on my way to Wadi Mujib. Once we got to the site I immediately knew this was a mistake. My travel companions were mostly guys: some with tattoos, some with piercings, and some who weighed five times as much as me. It was at that point that I went to ask if the $90 was refundable, and to my dismay it was not. Great…. If my life were a movie, this would be the part where the inspirational music would start playing, I would see everything in slow motion, and recall some inspirational speech I once heard. And you know what? That’s exactly what happened. I kind of had that ‘This is now or never, don’t let your fear hold you back’ feeling. Pumped up, I headed straight to the lifejackets and tried to find my size. Being the incredibly curious (curious is an euphemism) person that I am, I wanted to inspect the lifejackets before facing my doom. The little sentence printed in the upper right was the last thing I needed to see: ‘This lifejacket is not approved under U.S. and Canadian Standards’. When you first step into Wadi Mujib the water level reaches your ankles. That’s the good news. But when you take a few more steps into the canyon the water level reaches your knees. That’s the bad news. The horrible news is that after a few more seconds the water level reaches your stomach! Again allow me to paint a picture. This scrawny person is in the middle of a canyon, in the middle of nowhere, it’s pitch black in there, the only thing you could hear is the water flowing and if you were to slip or fall you’d die! Why? Well there are rocks and boulders everywhere and the water’s flowing at an incredibly The Bull & Bear - October 2012
high speed (I got pushed off track by the water at least 16 times!). In my mind, trying to push your way through the water and trying to avoid the boulders was extreme enough, but apparently the real fun has yet begun. Wide eyed, I looked up to face what will probably be the last thing I’ll ever see on Earth. Inches away from me was a HUGE rock that we had to ‘climb’ to get to the other side. Being the uncoordinated person that I am, I didn’t quite know how to follow instructions such as these: “Put your left leg on the right side of the small rock. Then put your right leg exactly here so the water doesn’t throw you off course. With your right hand grab the rope and push
needed to be climbed. Same thing happened again except on the last rock I actually managed to climb the rock in an elegant fashion (after shedding some tears). What awaited me behind the last rock was out of this world! We found ourselves smack in the middle of a waterfall. Everyone (even the macho tattoo guys) was swimming excitedly around like little kids. Some people were taking crazy photos under the waterfall (I hope they had waterproof cameras), some were just lying in the water letting the current push them around, and some, like me, were just mesmerized by the beauty of it all. I saw the whole thing in slow motion again. The laughter I heard as well as the
“With your right hand grab the rope and push yourself off with your left leg. Got it?” Got it? No, I didn’t get it. yourself off with your left leg. Got it?” Got it? No, I didn’t get it. I decided to just follow my own strategy: Do anything as long as you don’t fall. Grabbing the rope (with the wrong hand) I tried to pull myself up. Nothing. I tried to position my legs differently. Nothing. Houston we’ve got a problem. The water seemed a little fed up with me and pushed me completely off track, and only my left hand was still grabbing the rope. This is the part in the movie where the really suspenseful music would be playing and people would be screaming “Oh My God” in the background. I was basically moving like a clock pendulum against the rock, the water pushing me back and forth, left and right. This went on for a good 30 seconds until one of the instructors gave me a boost and I was on my feet again (well on my knees and somehow I was able to stand up and get on my feet). I didn’t know how, but somehow I was able to take the steps necessary to get over the rock and to the other side (AMEN!) The other side was just as horrible. Why? There were three more rocks that we’re even bigger and steeper that
sound of the water was starting to fade out. That could mean one of two things: 1. I’m about to faint or 2. I was having one of those perfect happily ever after endings in movies. This time it was the second option and boy was I glad that I didn’t faint! After depleting my camera of memory (I needed photographic evidence), I felt so great for facing my fear. I felt even better that I was able to survive, didn’t faint, and most importantly, had a great time. This experience reminded me of a saying I had heard in the popular TV show, The O.C. Sandy Cohen said, “The anticipation of death is far worse than death itself.” Whenever we’re afraid of something, be it death, or that midterm you have next week and still haven’t studied for, all the time we spend anticipating it and worrying about it is so much worse than what actually happens when we’re faced with that certain event. The next time you’re faced with a situation that you really don’t want to go through with, just remember that it really is all in your head! Stop worrying about it, and as Nike says, “Just Do It!”
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LIFESTYLE
Second annual charity basketball game in Montreal combines competition and fun Josh Reisler STAFF WRITER
T
his past weekend, Pop Montréal put on a spectacular event for charity, which featured Varsity McGill and Concordia basketball players squaring off against adroit and athletic celebrities in an unexpectedly thrilling basketball match. Fans of all ages were
in attendance at McGill’s Currie Gym for the match, which was accompanied by concurrent entertaining musical performances. Although Pop Montréal is billed as an annual international music festival, it is host to an assortment of musically inspired events including a fashion gala, a
Team Pop gathers for a group photo.
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symposium, a film festival, an art exhibition, and now they have expanded with a music related sports component. The “Jock” team was comprised of some Varsity basketball players from McGill and Concordia, and an eclectic group of musicians, actors, and pro bas-
PHOTO BY RICHMOND LAM
LIFESTYLE ketball players represented the “Pop” team. Celebrities participating in the event ranged somewhere between notable and obscure. Among them were McGill alumni Win Butler and his brother Will Butler of Montréal’s own Arcade Fire, Nikolai Fraiture of the Strokes, Martin Starr of the cult TV show Freaks and Geeks, and NBA-free agent Luke Bonner. Kid Koala’s beats and Régine Chassange of Arcade Fire’s vocals supplied the soundtrack to the game. Kid Koala frequently sifted through a box of records throughout the course of the event, carefully selecting the music that he would play on the turntables and add his own touch to, all the while donning a full koala costume. His remix of “O Canada” opened the game. The high level of competitiveness displayed by both teams quickly led me to forget that I was watching a friendly basketball game for charity. On several occasions, Win Butler became so heated after disagreeing with some of the calls made by the referees, he openly expressed his discontent by shouting profanities while facing the crowd. In terms of gameplay, I was amazed by the skills and abilities
directly in front of the band, and three women attempted to operate a giant slingshot to project t-shirts into the audience. The slingshot repeatedly malfunctioned, but eventually was able to shoot the t-shirts into the receptive crowd. Despite not knowing which act to focus on, the audience still enjoyed the high energy, albeit chaotic, atmosphere. It appeared that the majority of fans showed up to see the celebrities rather than the basketball game, and they were not disappointed. More clapping erupted during the few times Nikolai Fraiture was handling the basketball than at critical moments in the game. Moreover, a group of students were elated after getting their picture taken with their favourite character from Freaks and Geeks just before halftime. After the winners were declared, confetti was blown from two canons on either side of the court, and fans then flocked onto the court to meet and take photos with the stars. Win Butler played a considerable role in organizing the second Pop vs. Jock event along with Pop Montreal, and Dexter John of the DJ Sports Club, a nonprofit charitable organisation located in
The majority of fans showed up to see the celebrities, and they were not disappointed. exhibited by both squads as the participants competed at an extremely high level. Fast-paced dunks, smooth passes and a flurry of three pointers contributed to the excitement. The score of the game proved that the teams were quite evenly matched. After trading points back and forth in the final seconds of the game, the Jocks prevailed over the Pop team with a close final score of 96 to 93. One of the highlights of the game was the half time show. David Byrne, (former member of the Talking Heads), the Butler brothers, and Nikolai Fraiture on bass guitar (forming the most unusual ensemble), performed a rendition of KC and the Sunshine Band’s, That’s The Way I Like It, while a roller derby took place The Bull & Bear - October 2012
Montréal’s southwest borough. The proceeds of the event will go toward the DJ Sports Club, which happens to be one of the largest youth clubs in Montréal that provides sport, educational, social, and recreation programs for youths. When I first heard about Pop vs. Jock I was keen to go, and it exceeded my expectations. Pop Montreal should publicize this event more next year, because I believe it would attract a much large audience and benefit their benevolent cause. I would highly recommend this event to fans of Arcade Fire, music lovers, basketball enthusiasts, and anyone who enjoys a good time, as the event has a little something for everybody.
Ferreira Café: Faim de soirée Kokulan Mahendiran STAFF WRITER
M
ontréal has seemingly always been known for its great array of restaurants. And yet, Montréal doesn’t even feature in Food & Wine’s 10 Best Restaurant Cities list, nor does it come up on Forbes’s World’s Best Cities to Eat, or on USA Today or MSNBC’s lists. Now although Montréal is hardly the bastion of cuisine that many Montréalers imagine and claim it to be, it is nonetheless blessed with a handful of amazing finds. One of which lays a short walk from campus on Peel, between Maisonneuve and St. Catherine. In the words of Lesley Chesterman, food critic for the Gazette, “… Montréal may not be the coolest dining destination anymore, but at Ferreira on a sunny Friday night, I can think of few restaurants more impressive.” Ferreira Café is impressive and authentic, both in terms of its food and its décor. You can’t help but feel like you’ve been whisked away to Portugal as you indulge in their delicious grilled chicken whilst enjoying a glass of Porto. Although Ferreira Café is always packed with what seems like businessman with very heavy pockets during the day, it is by no means the domain of costly suits. The restaurant turns into quite the lively scene as the evening turns to night. In fact, as of 10pm sharp, a late-night menu is made available, which is far more pleasing to the student wallet. For $23.95, a two-course meal consisting of an appetizer and a classic entrée is offered and the thought of skimping out on portions doesn’t even occur. The Faim de Soirée menu provides a delectable meal for a very fair price in one of the best establishments in the city. This is one restaurant that most certainly does this city proud.
KOKO’S PICKS
Appetizer: Grilled/Fried Calamari Main: Portugese Style Organic Chicken Breast Total: $23.95
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LIFESTYLE
Emily Barber STAFF WRITER
T
he Next 36 is a program designed to identify and cultivate Canada’s next generation of leading entrepreneurs. Following a rigorous selection process, 36 undergraduate students of diverse academic backgrounds are selected from across the country and divided into teams of four. Each team is given $80,000 of seed capital to pursue a business venture in the mobile technology sector. In addition, teams are mentored by some of Canada’s most renowned business leaders and educated by some of the world’s top faculty. Among Canada’s 2012 Next 36 were three McGill students: Jade Proulx—food chemistry, Anne-Marie Paquette—architecture, and Omer Dor— chemical engineering. Proulx, Paquette, and Dor all learned about The Next 36 from McGill faculty; their respective academic and extra-curricular track records earned them an invitation to a private Next 36 McGill event, at which they were able to speak with current participants and learn more about the program from its founders. Paquette had always been “interested in engaging with people from other departments,” and she was drawn to the program because it “takes people from any academic discipline from all across the country and puts them together in multi-disciplinary teams” in order to create new businesses. Dor was attracted to The Next 36 because he “wanted to compete against and learn
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from some of Canada’s most innovative and talented young men and women.” The Next 36 is a dream opportunity for any entrepreneurially spirited student; however, the selection process is rigorous and extremely competitive, with over 1,000 applicants for the 2012 program. Proulx’s application was set apart
and openness to learn, and secondly, the guts to act on those opportunities.” The applicant pool is narrowed down to 72 students and competition is heightened at the infamous selection weekend that takes place in Toronto at the end of November. The first word that came to the minds of all three McGill candidates
The Next 36 is a dream opportunity for any entrepreneurially spirited student; however, the selection process is rigorous and extremely competitive, with over 1,000 applicants for the 2012 program. by involvement in her faculty; as the McGill Food Science Association President, Proulx organized the first-ever Gastronomy & Science Symposium, which featured world-class guest speakers from France, Canada, and the U.S. Dor feels his childhood in Israel set him apart, as throughout childhood, out of necessity he “was always trying to figure out what other people wanted or needed-and how [he could] give that to them.” Paquette identified two essential characteristics of Next 36 candidates: firstly, “a general curiosity
when asked to describe this weekend was “intense.” Proulx recounted co-founder Reza Satchu taking the stage in front of 72 of Canada’s top undergraduate students: “Person X, you have the lowest GPA in the room, why do you think we should still consider you for The Next 36?” Over the course of the day, candidates go through a series of over 10 difficult interviews and on the morning of the second day, The Next 36 were revealed. Paquette remembers enjoying “five minutes of euphoria and then get[ting] straight to work, [as
LIFESTYLE
there was] less than a 24-hour turnaround from the time you are selected to the time you are pitching to all the stakeholders in The Next 36.” Dor recalls a moment minutes before going on stage to pitch in which he realized they “didn’t address [their] expected market valuation.” He informed his mentor and “in three minutes [he delivered] a crash course about EBITDA, gross margins, and cash flow analysis.” Do hung these notes up in his room as “a reminder of the quality and speed at which you learn rom being a part of The Next 36.” Following selection weekend, teams work remotely on their ventures as many candidates complete the spring academic semester and others work part or fulltime on the business post-graduation. Many teams were spread out from coast to coast and came together on holidays and breaks at a central location to work together in person. In the meantime, Paquette notes “skype, google chat, google plus were constantly open on [her] browser, but it was never really a struggle for [her team] because it was the reality [they] were dealt” and they had to make it work. Omer Dor and his team created MobiCare; Mobicare is a mobile application designed to help family and friends care for people living with Alzheimer’s disease or related dementia. MobiCare builds a circle or care that provides the tools to The Bull & Bear - October 2012
help families better coordinate caregiving responsibilities and track symptoms, as they are observed in real time. Dor and his team “wanted to leverage [their] expertise with [their] passion to make a serious impact in peoples’ lives [and] create some real value for families who are dealing with the management of Alzheimer’s or related dementia.” Jade Proulx and her team created Atlus; Atlus is a “recommendation system that is very trustworthy, and highly customized.” They created Atlus in hopes of “digit[izing] the way you would ask a friend ‘Do you know a good place around here?’.” The social component of Atlus is what sets it apart from Yelp, Foursquare and the like, as although these sites provide ample reviews, they are often anonymous and not very trustworthy. Anne-Marie Paquette and her team decided the best way to “use all of [their] strengths to the best of their abilities would be to pursue an opportunity that [her teammate] Morgan had identified in creating better quality of resources for stroke survivors. Strokelink utilizes digital media to provide survivors with an engaging comprehensive toolkit of coping strategies, preventative information, interactive rehabilitation programs. The Strokelink team’s vision is to pave the way in an untouched market space by “creating a lot of value for fewer individuals as opposed to creating marginal value for a
lot of people.” Venture day serves as the culmination of The Next 36; it is on this day that each team pitches their venture in front of over 300 people, including all major Next 36 stakeholders. What happens after this day is in the hands of The Next 36. Proulx decided not to continue as an active member of the Atlus team, though the venture is still in existence and being run by the other co-founders. Dor and some of his co-founders are continuing to develop Mobicare and Strokelink is one of two ventures that have all four founders staying on to grow the business. When asked about his biggest takeaways from The Next 36, Dor responded: “The next 36, its advisors and professors, my mentors and the friends I met have made such a profound impact on my growth as a leader, as an entrepreneur and as a person. I have learnt the importance of recognizing my weaknesses and addressing them to increase my chances of successes. I have my own expectations of what I can achieve raised. I have gained a deep appreciation for Canadian generosity, one that instils a strong desire to give back to our community. The lessons I learnt in The Next 36, I will carry with me for the rest of my life.” For more information on The Next 36 and the application process visit www. thenext36.ca
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LIFESTYLE
Eat Your (Drunk) Heart Out
Have you ever woken up in bed next to a half eaten box of Chef-on-Call chicken tenders, and only then realized that they forgot to deliver your sweet potato fries? Us too. Piotr Pietruczuk STAFF WRITER
E
veryone knows how important it is to try and maintain a healthy lifestyle while at university. For a lot of people, it’s their first time truly being away from home, whereas others are simply getting a broader understanding of just how far their freedoms truly stretch. No one has the freshman fifty (adjusted for inflation) on their horizons. Regardless of how healthy we may eat and how much we may exercise, all bets are off once the weekend comes. The options are endless—hundreds of bars to hit up, a colossal number of clubs calling your name, or simply a quiet night of watching 10 hours straight of National Geographic programming. Thus, as important as the pre-drink or the actual action of going out, is knowing what artery clogging cuisine establishments to find late in the night to satisfy the demands of drunken appetite. Sometimes, it’s important/“healthy”/necessary to strafe from the sheltered conventional fast-food world of McDonalds and Burger King, and wander off into the unknown to conquer new taste buds and flavors. A constant favourite is the ever classy La Belle Province. While the menu may be full of awesome sounding hunger quenchers, it is usually best to stick with the elegant poutine. The traditional Quebecois dish is served with the perfect balance of cheese curds, fries, and gravy,
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which to compliment the greasy masterpiece, comes with a price tag of less than five dollars. For those in constant trepidation of their wallets being drained of their contents, there is absolutely nothing to worry about. Located on Saint Laurent, La Belle Province is a convenient place to frequent whenever drunkenness calls. Yet another student favorite is Crescent based Boustan. Open till 4am, Boustan offers traditional Lebanese gastronomy, ranging from pitas, to dishes filled to the brim with rice, chicken, and topped off with delicious sauces and garlic potatoes. With prices all under ten dollars, Boustan is a fantastic place to grab a quick bite whenever one is in a rush or just wants some Middle Eastern food to help absorb the copious beers the night has bestowed upon you. Just make sure to grab plenty of napkins so your favorite shirt doesn’t become a temporary one. Don’t think you’re superman and can get away with wiping it on your friend. They always do notice in the end. If Boustan doesn’t satisfy your wants and desires, Joe’s Panini on neighboring Drummond, is always a student favorite. Open 24 hours, it offers warm, delicious Panini sandwiches for just $5.50 (tax included!). One also has the option of upgrading to a combo comprising of a small salad and drink for $9. The spicy chicken sandwich is a constant favorite, and defi-
nitely a better deal than a mediocre footlong at Subway. Although the ambience leaves a bit to be desired, a drunken debaucher won’t really notice the difference. Ultimately, though, if one is truly on a tight budget, then there is only one place in downtown worth frequenting when the munchies beckon: Chez Mein, AKA Tooney Chow, located on Boulevard Saint Laurent. For two dollars, a feast abundant in noodles and soaked in delicious peanut butter sauce is served to all who come. That jubilant man/hero/ God is always there serving up noodles and occasionally dishing out one of their scrumptious egg rolls. Only if you know the secret word, of course. It goes without further thought that downtown Montreal offers a vibrant variety of cultural restaurants and fast food joints possible to hit up when the night falls and the munchies call. And after all, it’s better to regret something you ate than to miss out on something forever.
OPINION
A Decaying Society What does a PQ victory mean for out of province students? Murtaza Shambhoora STAFF WRITER
P
auline Marois and the Parti Québécois’ victory on the rainy September 4th night was greeted by bullets and uncertainty. A gunman’s maniacal cry that the ‘English are rising up” further intensified the sense of fear within the city. Such events promise that the road ahead for Quebec will not be easy under a PQ minority government. But as always, little analysis has been done on what this turn means for international and out of province students in Quebec. The 25,000+ international students comprising about 8.5% of Quebec’s universities on averagehave largely been on the sidelines since the printemps érable. McGill University, which no doubt boasts the largest number of students from outside of Quebec (15,000 strong) will be heavily affected by this political uncertainty in the long run, something out of province students like myself should be worried about. The first issue working against out of province students is the rocky economic road lying ahead for Quebec. Glen Hodgson, a Chief Economist for the Conference Board of Canada offers a grave look into Quebec’s future due to the policies of the PQ government. The recent elections saw an inadequate discussion of economic policies, and “many Quebecers appear to have no idea what is about to hit them.” Quebec’s economy will grow by a meager 1.5% this year, well below the national average while maintaining the highest government debt as a share of GDP at 55% (Conference Board of Canada). This is terrible news for Quebecois students, but worse still for out of province students who have invested more than $20,000/year in obtaining a McGill degree, and enjoy no long term unemployment support from the Quebec The Bull & Bear - October 2012
PHOTO VIA NAT CARSON
Protesters at a Montreal rally
government. In fact, most international students will have to leave the province as soon as our study permits expire. The PQ’s stringent language & immigration laws will also work against out of province students in the long term. If Bill 101 is to be expanded, French will be mandatory for small businesses and access to English medium CEGEPs will be severely limited. Additionally, the PQ has claimed that it will only welcome new immigrants who speak fluent French (Montreal Gazette). This return of identity politics is not something out of province students came to Quebec for. Finally, it is painfully apparent that Quebec’s most prestigious university can no longer sustain itself according to current funding models. McGill University’s budget for the 2013 fiscal year relied on much needed revenue from the tuition increases to start tackling the $280 Mil-
lion the university has sitting around in debt. Instead, due to the PQ’s, and the red-squares’ short sightedness, the university adds another $90 Million in debt by 2018. These numbers might not mean much, but what they directly transfer into is less financial aid and fewer work-study jobs for outside students. Additionally, more cuts within academic departments will worsen McGill’s international reputation- currently standing firm at 18th best in the world according to the QS ratings. McGill’s prestige, and the international rankings many students ridicule, is the reason why so many international students choose this school over the University of Toronto or UBC. So what, you might say? Why does Quebec need an internationally renowned institution like McGill, and why do we need so many outsiders settling into the province? According to various reports both from within McGill and external think tanks, McGill obviously has a significant impact on Quebec’s economy. A report released by the Secor group, a consultancy, specifically calls McGill “central to development and dissemination of the knowledge” needed to make Quebec competitive and innovative in the world economy. McGill’s 15,000 strong out of province students contribute towards the $1B in added value and 14,000 jobs the university generates. But if these reports are left ignored, and the PQ government is left unchallenged, Quebec will continue to decay as a society. As the state of Quebec’s universities decline, and the government becomes increasingly hostile to foreigners, ‘le belle province’s’ varied culture and vibrant cities will no longer be enough to attract talented minds from across the world.
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OPINION
Iran: Villain or Victim The case for non-intervention Davide Mastracci STAFF WRITER
O
n September 27th, at the UN General Assembly, Israeli Prime minister Benjamin Netanyahu claimed that Iran is 70% of the way towards a nuclear weapon and must not be allowed to reach the 90% mark. Netanyahu illustrated this point by dramatically drawing a red line near the top of an image of a cartoon like bomb. In response to this, Jon Stewart, the host of the Daily Show, asked, “What’s with the Wile E. Coyote nuclear bomb? You’re going to pretend that you don’t know what a nuclear bomb looks like? You’re Israel! Run downstairs and look in the basement.” While Stewart is a comedian, the truthful implication of this joke is not funny. Nor is the fact that Netanyahu’s fear mongering is an old tactic. For example, in 1992 Netanyahu claimed Iran was a mere three to five years away from being able to produce nuclear weapons. 20 years later Netanyahu continues to make the same sort of statements. In response, Iranian officials have repeatedly claimed that their uranium enrichment is being done for civilian purposes alone. Evidence seems to support these claims. For example, under the Nuclear Non-Proliferation Treaty, Iran has agreed to allow the International Atomic Energy Agency (IAEA) to inspect its nuclear sites. The IAEA’s most recent investigation in August of 2012, though unable to guarantee the lack of development towards nuclear weapons, was also unable to point to any evidence of such. In fact, according to Inter Press Service, Iran has actually reduced their supply of 20% enriched uranium, which is the only material capable of being further enriched to weapon grade status. While it is slightly worrying that the IAEA was not able to inspect every nu-
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PHOTO VIA TIME WORLD
Benjamin Netanyahu draws the “red line” on Iran’s pending nuclear threat
clear site within Iran, this is not an uncommon occurrence. For example, Argentina, Brazil, Egypt, and Venezuela have all failed to meet this Additional Protocol, yet they are not routinely subjected to accusations of secretly building nuclear weapons.
Meanwhile, Israel completely prevents the IAEA from inspecting any of its nuclear sites and is not a part of the Nuclear NonProliferation Treaty. It is clear that Netanyahu was wrong in 1992, and it appears as though he is wrong again.
In response, Iranian officials have repeatedly claimed that their uranium enrichment is being done for civilian purposes alone.
OPINION Despite this, in their hunt to prevent Iran from enriching uranium, Israel has committed numerous actions which have made them prone to accusations of the violation of international law. For example, within the last two years, five Iranian nuclear scientists have been assassinated. According to Western intelligence sources cited by Time magazine, all of these scientists were victims of a group financed, trained and armed by Israel’s Mossad. This accusation is shared by Iranian officials, former Mossad officers and the director of research at the Washington Institute for Near Policy, amongst others. Though Israel has not officially claimed responsibility for the murders, a smiling senior Israeli official summed up their attitude in the following response upon the most recent assassination in January, “Yeah, one more. I don’t feel sad for him.” While the attitude and fear of Israeli officials is understandable due to some of the rhetoric espoused by Iranian figures like Mahmoud Ahmadinejad, it does not justify Israel’s reaction to the perceived
threat. Yet, even when one disregards Israel’s problematic response to Iran, it seems as though the fear of Iran has been blown out of proportion. Despite the fact that the Israeli and American governments alike have attempted to portray Iran as the greatest threat to peace, much of the world disagrees. For instance, a poll representing 85% of the Arab world population, conducted by the Arab Centre for Research and Policy Studies, found that only 5% of respondents see Iran as the biggest threat to peace in the Arab world while 51% indicated Israel, and 22% America. In fact, Noam Chomsky claims that “Opposition to US policy is so strong, that a majority ... say the region would be better off if Iran had nuclear weapons. Almost 80% in Egypt and a high percentage in the rest of the region.” This opinion is not limited to the Arab world, as Chomsky also claims polls in Europe indicate that Israel is regarded as the main threat to peace. Essentially, while the threat of nuclear war is an important one, Israel’s obsession
with Iran’s uranium enriching program is a much graver menace to world peace at the moment. Netanyahu has repeatedly attempted to get America’s support for an attack on Iran’s alleged nuclear bases. Though America has refused thus far, Israeli officials have indicated that they may proceed anyways, and as promptly as November of this year, regardless of the fact that a recent poll from the Israeli Democracy Institute has indicated that only 27% of Israeli’s would agree with it. In response, Iranian Brigadier General Amir Ali Hajizadeh has claimed that if Israel is to attack Iran, a pre-emptive strike would be launched, which could “turn into World War III.” As such, the international community should condemn recent Israeli actions as a first step to prevent another Iraq war. The world does not need over 100 000 more civilian casualties just to discover that leaders like Netanyahu were wrong about the presence of weapons of mass destruction.
Engaging students in advocating against genocide and mass atrocities Conflict-Free Campus Initative This campaign works to educate the McGill community about the conflict in the DRC and the role of “conflict minerals”.
Fundraising for the Valentino Achek Deng Foundation STAND McGill also holds fundraising events to benefit the VAD Foundation which builds a school complex in post-conflict South Sudan. mcgill@standcanada.org The Bull & Bear - October 2012
www.standcanada.org
Look out for our upcoming Halloween Costume Sale on campus at the end of October!
Tuesdays@ 5:30 in the Arts Lounge
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OPINION
Ahmadinejad Power’s Nuclear Iran Against Israel and the World An analysis of the Iranian nuclear weapons program and its intended use Daniel Sorek STAFF WRITER
“The Zionist regime and the Zionists are a cancerous tumor. Even if one cell of them is left in one inch of (Palestinian) land, in the future this story (of Israel’s existence) will repeat.” —Mahmoud Ahmadinejad
I
t’s pretty clear that Mahmoud Ahmadinejad hates Israel and all Jews residing in the country. And of course, anyone can see Ahmadinejad’s desire to destroy Israel is only enhanced by his blatant Antisemitism and revisionism of Western history. For example, he likes to suggest, “They (the Western powers) launched the myth of the Holocaust. They lied, they put on a show…” Of course, the idea of the Western world orchestrating genocide isn’t too far-fetched to someone who believes that “The September 11 [attacks] were actually a planned game.” He seems to have a few rather interesting interpretations of the facts, which is even more worrisome considering Mahmoud Ahmadinejad is the President of Iran, a country one year away from developing enough weapons-grade uranium for its nuclear device. The international community’s concern towards Iran’s nuclear program prompted the International Atomic Energy Association, the organization tasked with inspecting nuclear sites, to investigate Iran’s compliance with the International Non-Proliferation Treaty. On August 30, of 2012, they reported that Iran is directly in violation of the accords by not providing access to the requested nuclear sites, and that even with this lack of access, the evidence suggested that, “Iran has carried out activities that are relevant to the development of a nuclear device”. Of course the IAEA was just showing up late to the party hosted by the United States, Israel and much of the Western
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PHOTO VIA WWW.GINACOBB.TYPEPAD.COM
“The battle that is going on in Palestine today, therefore, is the frontline of the conflict between the Islamic world and the Oppressor World”. —Mahmoud Ahmadinejad World Without Zionism Conference 2005
World. Fortunately, they produced an entire section (Section H. Possible Military Dimensions) of the report discussing Iran’s hopes to do more than power refrigerators and televisions through nuclear enrichment. Some apologists confusingly start with a claim that even in light of the evidence the Iranian threat is blown out of proportion, as Ahmadinejad must surely be a misunderstood man of peace. They must certainly be indifferent to the public statements made by Ahmadinejad and his “charity” groups, which include Hezbollah. Ahmadinejad has called Israel “a cancerous tumor” that must be “wiped off the map” who piggy backs off a makebelieve genocide (see Auschwitz), while Hezbollah makes echoing calls for the destruction of Israeli and world Jewry in its
national charter. Some even cite a statistic, which claims that only 5% of respondents in the Arab world consider Iran the number one threat to peace in the Arab world. They must have missed the WikiLeaks revealed diplomatic cables in November of 2010, detailing calls by King Abdullah of Saudi Arabia for the United States to strike Iran militarily or when Palestinian Authority President Mahmoud Abbas said in a September 2010 statement that Ahmadinejad, “does not represent the Iranian people, who forged elections and who suppresses the Iranian people and stole the authority, is not entitled to talk about Palestine, or the President of Palestine.” This, of course, was a response to Iranian calls for the Palestinian Authority to cease negotiations with Israel and instead
PHOTO VIA WWW.RUSSIABLOG.ORG
OPINION
Iran’s potential missile weapons’ range as of 2007
tighten relations with Hamas, another Iranian supported terrorist organization. The fact is that Ahmadinejad and the Iranian government are doing more than threatening Israel: they harm other Arab states whom with the United States and other nations hope to create a more stable Middle East By now we must start to think of the ramifications of using examples of international law violations as targeted assassinations against nuclear weapons developers, instead of as violations of the UN charter by calling for a member state’s destruction. We also see the shortsightedness of the disapproval of the rigorous inspection of Iranian facilities compared to the lax ones performed in other countries such as Brazil, Venezuela, and Egypt. Calling for tougher and higher standards on Iran does not mean the same cannot be done for other countries. Moreover, apologists fail to truly consider the basic issue: a country less than an hour’s flight away simultaneously argues for a people’s destruction while somehow maintaining its status as peaceful nuclear generator of electricity. These are simply two hats that cannot be reasonably worn at the same time. On September 27th, Israeli Prime Minister Benjamin Netanyahu brought the Iranian nuclear development program to the forefront of public consciousness by bringing a cartoon of a bomb to the United Nations. On the bomb, he The Bull & Bear - October 2012
drew a red line at the 90% mark, to indicate the Iranian progress within the next 11 months towards the development of their nuclear device. With the information that Iran, pledged to annihilate Israel, is this close to developing a nuclear device, it’s understandable that Prime Minister Netanyahu has been elevating his calls for military intervention. Some in the world prefer to argue that even the smallest military action is unnecessary and that economic sanctions will solely end the Iranian Crisis. However, as the United Nations Security Council has passed seven resolutions against Iran since 2006, including said sanctions, with little deterrence, with one year until completion it’s clear bolder action is required.
damage. Israel is currently drumming up support for its mission, as it would like to proceed with a consensus from the international community. While the world recognizes that Israel itself is in the most immediate danger from a nuclear-armed Iran, Netanyahu reminded America on September 25th of the dangers he pose. Remember, Iran simply views Israel as, “the frontline of the conflict between the Islamic world and the Oppressor World” (Mahmoud Ahmadinejad, World Without Zionism Conference). Israel and the Middle East today, Europe the next day, Canada and the United States next week. Even here, across the world supposedly safe in North America, we probably don’t want a country that sup-
“Iran has carried out activities that are relevant to the development of a nuclear device” - Director General of the IAEA Fortunately, war is unnecessary as the United States and Israel currently posses the technology to quickly destroy Iranian nuclear bunkers without full-scale commitment or any collateral
plies terrorists and who Prime Minister Netanyahu says “put their zealotry above their survival” to have nuclear weapons capable of destroying millions of civilians at a time.
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OPINION
The Real Friend Zone Another perspective on a universal phenomenon Elliott Charbonneau STAFF WRITER
I
n our September issue of The Bull & Bear, an article was published entitled “Misogyny in the Friend Zone” portraying the “friend zone” as a chauvinistic and decidedly misogynistic concept created by men as a scapegoat for shortcomings in their sexual exploits. I felt that the article, while addressing several valid points, failed to touch on three major issues. The friend zone is not a place unique to men, there is a definitive difference between using the friend zone as a scapegoat and stumbling into it and finally the friend zoner (the one who places a friend in the friend zone) can often be the antagonist. First and foremost, being put in the friend zone is not a situation unique to men. Any conversation on the topic with a female friend quickly reveals personal stories or tales of other girl friends who have fallen into the awkward situation of having their romantic advances stonewalled by a male friend. A romantic relationship is something that almost everyone strives towards at some point in their lives, regardless of the combination of x and y-chromosomes they posses. Unfortunately, our romantic feelings and sexual attraction to another are not always greeted with the same sentiment. Rejection happens to everyone, it’s fact of life and a risk we all expose ourselves to when we open up to others. At some point a man or woman might want a relationship with one of their best friends and making this desire known puts them at risk of being rejected all the same. Accordingly, women just like men are subject to being friend zoned. Second, a clear distinction must be drawn between being legitimately friend zoned and using the notion of a friend zone as a scapegoat. A true friend zone occurs organically in some relationships.
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It is not a forced construct conjured up by the rejected. Rather, an individual slowly develops unreciprocated feelings for their friend over months or years. Any time
PHOTO VIA WWW.LIPSTIQ.COM
Anyone risks ending up in the friend zone
someone forges a friendship with the ulterior motive of sex or otherwise and then finds himself or herself failing to get what they want is not being friend zoned, that’s just rejection. The term “friend zoned” is used too broadly today to externalize the blame of one’s failed sexual or romantic ventures. Falling into the friend zone occurs slowly and naïvely, not over the
course of a single week or a month. Ultimately, being placed there is not the same as placing yourself there. Which brings me to my final point, the friend zoner can, at times, be the antagonist. When it comes to making the switch from friend to boyfriend or girlfriend, there are often some pretty obvious cues. The love struck friend might insist on more one-on-one time, gift giving, and generally going above and beyond the regular line of duty of a normal friend. Irrespective of the specific signs, the fact remains the signs are there. The problem here arises when the center of attention becomes aware of these cues but chooses to ignore them in favor of the adoration they’re receiving. When confronted with excuses along the lines of “I value you too much as a friend to risk losing you”, the aspiring lover is being strung along. Mind games like this victimize the person looking to escape the friend zone, not the one being propositioned. The victim in many instances of the friend zone is decidedly the one friend zoned and not the one doing the rejecting. “Misogyny in the Friend Zone” put all of the blame on men’s blind conquest for sex for the existence of the friend zone. The truth is any of us could wind up in the zone and the real friend zone arises because of romantic feelings, not sexual ones. Perhaps the true problem with the friend zone is not that it spurs sexist chauvinism but rather that it has become a broadly used coping mechanism used to deal with rejection. Next time you find yourself on the receiving end of being friend zoned, find solace in the fact that you’re not alone, and if you find yourself putting someone else there, remember: we’re all human and rejection is hard to swallow regardless of who you are.
t o H New Arrested Development: The new photos from Entertainment Weekly depicting the Bluths as staunch aristocracy stirs enough emotion to warrant a tearful chicken dance.
Anna Dello Russo x H&M: You know what you need? You need a fashion shower. Damsels of Desautels, your poorly fitting skirtsuits would benefit from a bit of bling, a feathered headpiece and thigh-high leather boots. Get on it.
The Times Higher Education Ranking: McGill ranked #34, Toronto ranked #21. Yeah, no.
October 3rd: Raise your hand if you’ve ever felt personally victimized by the same JPEG of Lindsay Lohan.
Beef Recall: The largest Canadian meat recall from the second-largest meat producer makes carnivores cry on the inside. In other news, Midnight Kitchen is chugging along just fine, thank you.
The Bull & Bear - October 2012
OPINION
Justin Trudeau: The hottie with a body (and a mean right hook) is gearing up for the Liberal party leadership. Can the 40 year old Montreal MP save the sinking Liberal ship? The Casual Vacancy: J.K. Rowling’s new novel may have received mostly positive reviews, and you might be excited to see how her writing has evolved from a young adult to a real adult audience, but you probably have too much work to get to it. Probably.
Snoop Dogg/Lion’s List of Reasons to Not Vote for Romney: Gems include “He a ho”, “He always interrupts and talks over people like he’s better than them. Bitch I will beat the shit out of you” and “He’s a Mormon but he ain’t got no hoes.”
Obama at the Presidential Debate: Barack is kind of like Lana del Rey: great when rehearsed in a studio (or with a teleprompter), dreadful live on SNL.
Butt-Chugging: Pi Kappa Alpha at the University of Tennessee hazed their pledges by administering wine enemas, which honestly sounds like a waste of wine. Oh, and they’re also denying allegations that they’re gay (which is totally something gay guys do).
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