Word: model
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Dates: during 2000-2009
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...Some developing countries welcome a new model of capitalism. Cambodia, for example, has played the game of global trade; it signed a deal with the U.S. governing its garment exports, a big part of its economy. Now some Cambodian leaders think they should look elsewhere. "Why wouldn't we copy what China did?" one official in Phnom Penh said to me. "We had years of what the U.S. told us to do, and got this" (he pointed at beggars crawling outside a five-star hotel). "Now we go to China and all we see is how far ahead...
...least since the fall of the Soviet Union. Unlike the East bloc, however, the new state capitalists - China, Russia and the Persian Gulf states, primarily - have proven so successful that even before the crisis they caused world leaders to wonder if democratic capitalism might not be the best economic model after...
...idea behind the Macquarie model is to borrow a lot of money cheaply, buy infrastructure assets with a guaranteed cash flow, then sell those assets to the public, letting shareholders take over the debt. Macquarie and imitators like Australia's Babcock & Brown make money at every step, with fees for the deal, for advice, and for managing the assets. Macquarie runs toll roads in America, bridges in Portugal, French autoroutes, a tunnel in Germany, and airports from Sydney to Copenhagen. About 290 million people ride its buses each year, and 17 million light...
...investors, all this looked good, because roads and bridges with little competition should produce a steady return via tolls for generations. But with asset prices falling and easy debt a thing of the past, some believe the Macquarie model is in for a shakeup. JP Morgan's Brian Johnson says it is "likely dead...
...Morris, an analyst with stockbroker WiseOwl.com. "Now that the storms have come, they can't help but watch their house subside into the ocean." And Macquarie? More diverse sources of revenue mean "it's better built to weather the storm," Morris says. But the borrow-to-buy infrastructure model "is dead in the water...