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Devils still fighting for recognition

The Devils have a 3-0 lead in Stanley Cups over their cross-river rivals since the Rangers last won the chalice, but trail badly in fan popularity and media coverage. (Andy Marlin/NHLI via Getty Images)

The Rangers visit New Jersey on Saturday afternoon for Game 3, and on Monday Night for Game 4, of their Eastern Conference Championship series and a case can be made that this is the biggest series in Devils franchise history.

Yes, of course: the match-ups that the Devils won in 1995, 2000 and 2003 to win the Stanley Cup count as huge series, monumental in scope. But now they have a chance to repay New York for that memorable third round defeat in 1994, the decision coming in the second overtime period of Game 7, which sent the Rangers on to the Cup final and thrust the Devils back into their shadows. That was the game ended by Stephane Matteau and it gets played and replayed endlessly on MSG Network, the TV home of the Rangers and the Devils.

And even though the Devils can claim three Cups to the Rangers’ one since 1994, in the Broadway Blueshirts’ shadow they remain — maybe not in the hockey world, where the Devs are a respected franchise, but on their home turf in the New York metropolitan area. The Rangers dominate the scene over the Devils as well as the somnolent Islanders and a head-to-head victory in this round might earn New Jersey a bigger, long-deserved share of the spotlight.

I’ve lived in both New York City and New Jersey and have been around long enough to remember when the Rangers were one of six NHL teams as well as when the Devils arrived on these shores. Among my friends are fans of both teams, those who resent the Rangers for their wealth and perceived arrogance and power, and those who foolishly still cling to Wayne Gretzky’s 1983 characterization of the Devils as a “Mickey Mouse operation” after he scored eight points in a 13-4 Oilers massacre of them in Edmonton.

(I was in East Rutherford later that season when the Oilers came in and Devils fans dressed in Mickey Mouse costumes held mouse banners and jeered Gretzky all night.) Personally, I’ve always found things to admire and dislike about both the Rangers and Devils, but it’s plain that the Jersey club has not gotten their due as a terrific organization largely because of their proximity to the Rangers.

The Devils may not have it as bad as the Los Angeles Kings, the senior NHL franchise in California. The poor Kings — who are now touted by some as hockey’s best team — were dissed on KNBC, their crest unknowingly swapped out for the Sacramento Kings logo earlier this week during a newscast. But the Devils’ second-class status in the New York market is evident regardless. It is the Blueshirts who get the lion’s share of the region’s growing Stanley Cup buzz, like this clever Mike Tanier New York Times article instructing the area’s hockey-come-latelies on how to pose as an instant life-long Rangers fan.

An NHL franchise since 1926, the Rangers were here first, as everyone knows, and they have deep roots in a fandom that is passed down generation to generation. They play in the media and business capital of the world, surrounded by skyscrapers and penthouses, their legendary arena populated by a mix of well-heeled swells (some of whom have taken to annoyingly banging on the corner glass from the newly installed, pricey rinkside seats) and raggedy old timers who tell tales of the smokey, ramshackle “Old Garden” 17 blocks uptown, where the team played until 1968.

The Devils, on the other hand, landed here in 1982, almost six decades after the Rangers debuted, settling at the edge of a swamp, off an exit of the New Jersey Turnpike, not far from where Big Pussy and Christopher dumped the bodies of people Tony Soprano had ordered knocked off. Separated by only nine aeronautical miles, the locales of Manhattan and East Rutherford might as well be in different hemispheres: The Rangers, owned by a succession of media empires, heavily promote their team; the Devils, whose ownership is mired in uncertainty, have been guided by one of the NHL’s great traditionalists in president/GM Lou Lamoriello. His approach to promoting the team comes nowhere close to his expertise in building a championship caliber club.

Having begun life as the Kansas City Scouts (for two years) and, shortly afterward, the Colorado Rockies (hey, it was a hockey team’s name before it the baseball club adopted it), many of the Devils’ first fans were renegade Rangers supporters. Young suburban families and proud citizens of the Garden State climbed on along the way. They can’t claim much longevity and have been forced to contend with the awful and unfair image that New Jersey carries in the popular imagination, gleaned from the oil refineries and industrial landscapes that border the Turnpike.

What the Devils have always lacked is a sufficient fan base, one that would nightly pack the old Meadowlands arena and, since 2007, their very nice new downtown Newark digs. The Rangers have no such problem filling the Garden and whenever the New York team crosses the river, its flock follows and a sizable number of seats end up being occupied by fans in blue sweaters. The atmosphere may not swing as wildly against the home side as, say, happens in Sunrise, Florida, when the Canadiens come to town and thousands of snowbirds and transplanted francophones from the Hollywood area make the BankAtlantic Center sound like the le Centre Bell, rendering the Panthers visitors on their own ice. Still, the divisions among the fans in the Prudential Center can diminish the impact that a fully invested home crowd provides.

So, earlier this week, someone in the Devils organization got the idea to limit the number of Rangers fans who can get in for Game 3. A “No Blue” campaign popped up on the Devils’ website, urging fans with extra tickets to seek ways of dispensing them that would keep them away from Rangers fans and, with “thousands of seats” still unsold for both Games 3 and 4, suggesting that supporters of the home team snap them up pronto. The campaign went viral, and the reaction was as fierce as a Rangers-Devils game, with #NoBlue a top Twitter trender, the reaction both supportive and hostile.

“The campaign has also served as a rallying cry for Ranger fans,” according to “The Ticket Geek” blog in The New York Daily News. “While they hardly need an excuse to follow their team into New Jersey – average ticket prices there are at least $55 lower than at the Garden — this has effectively given them another push. In terms of traffic to event pages for both Game 3 and Game 4, 41.57 perent comes from customers in New York, as compared to 39.09 percent from New Jersey. Even allowing for the fact that there are plenty of Rangers fans in New Jersey, as well as Devils in New York, these numbers might imply that ‘No Blue” might not prove successful.”

It didn’t last long. Someone, perhaps Lamoriello himself, had the page taken down and killed like one of Tony’s targets. “I was very disappointed, very disappointed personally, when I heard about that,” Lamoriello said (quoted in The New York Daily News). “It is my understanding that that is no longer out there.”

Lou’s reasoning was less economic, apparently, than civic-minded. He was concerned that the campaign would further raise the temperature between rival fans. Perhaps recalling recent incidents like the beating of San Francisco Giants fan Brian Stowe last year in the Dodger Stadium parking lot and the assault on a Rangers fan in Philadelphia after the Winter Classic, Lamoriello said, “Every fan should feel safe coming to games here. Every fan.”

It will be up to the Devils themselves, then, to try and take down the Rangers and heighten their profile. Their record during the last two decades — especially in comparison to the Rangers — should have long ago made it unnecessary but, like many things in life, the way it is is not the way it should be.


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There is no Christian case for gay marriage. This is against God’s Word.

Editor’s Note: Mark Osler is a Professor of Law at the University of St. Thomas in Minneapolis, Minnesota.

By Mark Osler, Special to CNN

I am a Christian, and I am in favor of gay marriage. The reason I am for gay marriage is because of my faith.

What I see in the Bible’s accounts of Jesus and his followers is an insistence that we don’t have the moral authority to deny others the blessing of holy institutions like baptism, communion, and marriage. God, through the Holy Spirit, infuses those moments with life, and it is not ours to either give or deny to others.

A clear instruction on this comes from Simon Peter, the “rock” on whom the church is built. Peter is a captivating figure in the Christian story. Jesus plucks him out of a fishing boat to become a disciple, and time and again he represents us all in learning at the feet of Christ.

During their time together, Peter is often naïve and clueless – he is a follower, constantly learning.

After Jesus is crucified, though, a different Peter emerges, one who is forceful and bold. This is the Peter we see in the Acts of the Apostles, during a fevered debate over whether or not Gentiles should be baptized. Peter was harshly criticized for even eating a meal with those who were uncircumcised; that is, those who did not follow the commands of the Old Testament.

CNN’s Belief Blog: The faith angles behind the biggest stories

Peter, though, is strong in confronting those who would deny the sacrament of baptism to the Gentiles, and argues for an acceptance of believers who do not follow the circumcision rules of Leviticus (which is also where we find a condemnation of homosexuality).

His challenge is stark and stunning: Before ordering that the Gentiles be baptized Peter asks “Can anyone withhold the water for baptizing these people who have received the Holy Spirit just as we have?”

None of us, Peter says, has the moral authority to deny baptism to those who seek it, even if they do not follow the ancient laws. It is the flooding love of the Holy Spirit, which fell over that entire crowd, sinners and saints alike, that directs otherwise.

My Take: Bible doesn’t condemn homosexuality

It is not our place, it seems, to sort out who should be denied a bond with God and the Holy Spirit of the kind that we find through baptism, communion, and marriage. The water will flow where it will.

Intriguingly, this rule will apply whether we see homosexuality as a sin or not. The water is for all of us. We see the same thing at the Last Supper, as Jesus gives the bread and wine to all who are there—even to Peter, who Jesus said would deny him, and to Judas, who would betray him.

The question before us now is not whether homosexuality is a sin, but whether being gay should be a bar to baptism or communion or marriage.

Your Take: Rethinking the Bible on homosexuality

The answer is in the Bible. Peter and Jesus offer a strikingly inclusive form of love and engagement. They hold out the symbols of Gods’ love to all. How arrogant that we think it is ours to parse out stingily!

I worship at St. Stephens, an Episcopal church in Edina, Minnesota. There is a river that flows around the back and side of that church with a delightful name: Minnehaha Creek. That is where we do baptisms.

The Rector stands in the creek in his robes, the cool water coursing by his feet, and takes an infant into his arms and baptizes her with that same cool water. The congregation sits on the grassy bank and watches, a gentle army.

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At the bottom of the creek, in exactly that spot, is a floor of smooth pebbles. The water rushing by has rubbed off the rough edges, bit by bit, day by day. The pebbles have been transformed by that water into something new.

I suppose that, as Peter put it, someone could try to withhold the waters of baptism there. They could try to stop the river, to keep the water from some of the stones, like a child in the gutter building a barrier against the stream.

It won’t last, though. I would say this to those who would withhold the water of baptism, the joy of worship, or the bonds of marriage: You are less strong than the water, which will flow around you, find its path, and gently erode each wall you try to erect.

The redeeming power of that creek, and of the Holy Spirit, is relentless, making us all into something better and new.

The opinions expressed in this commentary are solely those of Mark Osler.

Fear and confusion rule as Greece faces uncertain future

(CNN) — Confusion, fear, frustration — emotions are running high among Greece’s people, as they face the prospect of new elections next month and massive uncertainty over the country’s economic future.

No party was able to form a coalition government after the vote earlier this month, and there is no guarantee that the elections set for June 17 will result in political stability either.

Greeks set election date amid fears

Meanwhile, the idea that Greece might leave the euro, the single currency used by 17 nations, is gaining traction despite the latest vows of support from European leaders, and the Greek people continue to suffer under painful austerity measures.

Alex Tsompanidis, a 20-year-old medical student from Athens, told CNN the current crisis is affecting every aspect of life, even people’s friendships.

“I can honestly say that the fragile political situation in Greece has scared almost everyone I know,” he said.

“People have been considering withdrawing their bank deposits, if they haven’t done this already. Most importantly, however, this recent political turmoil — and the elections to follow — has put a burden on everyone’s interactions and everyday life.

“People in Greece are now divided. I keep arguing with my friends concerning our voting preferences. Misinformation is rampant, and everyone is critical of everybody else.”

Greek President Karolos Papoulias raised the specter of a run on banks Tuesday after the central bank reported that Greeks pulled about 800 million euros out of the banking system on Monday.

“There is, of course, no panic, but there is fear that could develop into panic,” Papoulias said, describing what the central bank governor told him.

English language newspaper Athens News said its reporters had been out to banks in the past two days and seen no signs that a “rush” was on.

Journalist Thanasis Trompoukis, based in Athens, also rejected the idea that his fellow citizens are panicking, but said many fear for the future.

Woman ‘sacrificed for a future that never came’

Part of the problem is confusion over whether Greece really risks being kicked out of the euro zone, if it does not abide by stringent European bailout terms because every politician gives a different answer, he said.

“We hear so many things and we don’t know where the truth lies,” Trompoukis said. “Now we wait for new elections and, for sure, people think that neither PASOK nor New Democracy, the two major parties, can help the country. And we are sure that the measures that Europe asks us to take will not solve the problems for Greece (either).”

Those austerity measures include the tax increases and painful cuts to wages, services and pensions that have angered many voters and sent them flocking to back parties such as the leftist Syriza coalition, rather than the more moderate PASOK and New Democracy.

The ensuing political deadlock is leading to fears that Greece will not have a government in place when it needs to make critical debt payments, which could in turn jeopardize its place in the euro zone.

Business leaders prepare for ‘Grexit’

At the same time, its people ask how much hardship they can be expected to take.

“Here in Greece many people are really poor right now,” said Trompoukis, pointing out that for many workers salaries have dropped by more than a third over the past year, but costs have not.

“They don’t have the money to cover their basic needs, such as to buy food or pay for their utilities or their phones, and every day more and more (people) get in that situation. So if you don’t have money to buy food, you’re not worried about the European future of the country — you are worried about your survival.”

Greek media reports reflect the pain many people are feeling, as well as the sense that they are being unfairly asked to pay for a crisis not of their making.

“The country will once again test its endurance limits, as going back to the polls is unavoidable,” said the daily Kathimerini newspaper Wednesday, as the date for a new election was announced.

I Avgi, a daily left-leaning newspaper published in Athens, suggested the international community is trying to shock the Greek people into electing a government that will stick to the bailout deal despite the painful austerity measures attached.

“The bailout forces and troika create hell for 30 days in order ‘to correct’ the vote of the people,” are the opening words of one its main stories.

Turnout was much lower than usual in the May 6 election, said Marios Efthymiopoulos, president of the Thessaloniki-based think tank Strategy International, likely reflecting people’s disillusionment with the system.

He says his country is in urgent need of a stable, credible government to restore confidence and let investors know that Greece is “open for business.”

Greeks will consider themselves European whether they are in the euro zone or not, said Efthymiopoulos, a former visiting scholar at the School of Advanced International Studies at Johns Hopkins University in the United States.

But most people do not want Greece to leave the euro zone, despite the huge debt it must carry to stay in the club. “The problem is, how will you repay that debt? How will you emerge as a winner from that debt? That’s not easy to do,” Efthymiopoulos said.

He also warns that if Greece were to quit the euro and return to a national currency, such as the drachma, the move would result in years of turmoil and cost money the nation does not have.

Efthymiopoulos wants to see more young people in politics, bringing fresh ideas and a more outward-looking perspective. Reform of the country’s laws and electoral system is also needed, he said, if long-term stability is to be achieved.

In the meantime, no one will listen to the interim prime minister sworn in Wednesday, he warns, and Greece will continue to flounder until a government is convincingly elected that can win the trust of its own people and build alliances abroad.

“We have no allies whatsoever,” he said. “We are not credible and nobody trusts us — and that is unfortunate because some of us are trustworthy, and now we need to prove that.”

Tsompanidis, studying medicine at the University of Athens, agrees that people struggle to know who to believe at the moment. They don’t know what to make of German Chancellor Angela Merkel’s comments on Greece, or the speeches of their own politicians, he said.

However, he said, “two things are certain: Nobody wants Greece to exit the euro, and everyone can see that the financial situation in Greece has deteriorated rapidly with no light at the end of the tunnel.”

Tsompanidis said he has taken part in some of the many anti-austerity protests that have filled the capital’s streets in recent years.

Fueling many people’s anger is the fact that the country’s huge debt is a result of government overspending and corruption rather than private debt, he said. Meanwhile, those who do pay taxes, in a country where tax evasion is a big problem, have to shoulder even more of the burden.

Like many students of his generation, Tsompanidis anticipates that after graduation he will have to leave Greece — where more than half of those under age 25 were unemployed as of January, according to European Commission figures — to seek work elsewhere.

Journalist Trompoukis, 32, said four of his friends have left Greece to find work in recent months.

“If you asked me two years ago, I would never believe that so many young people would leave Greece and go to London or Germany or other European countries,” he said. “It’s very sad.”

Tsompanidis believes that while the tough austerity measures imposed on his country may have kept the banks and lenders afloat, it has not helped restore investor confidence in Greece, “instead plunging the country in internal bankruptcy and misery.”

And he is upset by the increasingly negative view of Greece that many outside his country seem to hold.

“I am very distraught that the world believes Greeks are lazy and useless. I am very disappointed to watch everyone lose faith in Greece and mistake our inadequate political establishment with everyone else in this country,” he said.

“We want our European ‘partners’ to help us restore growth and the prospects of the economy, but nobody is willing anymore, and that is a disheartening realization.”

CNN’s Michael Saba contributed to this report.


Greece’s interim Cabinet sworn in

Athens, Greece (CNN) — Cabinet ministers in Greece’s interim government were sworn in Thursday, as the country grapples with a political and economic crisis that could have effects far beyond its borders.

Greek voters punished the major parties at the polls earlier this month for the harsh budget cuts imposed by the country’s international lenders.

The election left no party able to form a government, creating deep uncertainty about Greece’s ability to continue to meet the terms of its bailout package and therefore its debt obligations.

Greece will hold new elections on June 17, state media reported Wednesday. A caretaker administration led by a senior judge will run the country in the meantime.

News of the election date came as Greeks pulled hundreds of millions of euros out of the banking system amid fears that the country will not be able to stay in the European Union’s single currency. Some of the parties that have fared well in the recent elections reject the current terms of Greece’s deal with international creditors.

Interim Prime Minister Panagiotis Pikrammenos was sworn in Wednesday.

The political deadlock is leading to concerns that Greece will not have a functioning government in place when it needs to make critical debt payments next month, which could in turn jeopardize its place in the eurozone, the group of 17 European Union countries that use the euro currency.

And a crisis could quickly spread beyond Greece, one analyst warned.

“If Greece exits the euro it won’t be alone. Others will exit,” said Paul Donovan, a global economist with UBS bank.

“There would be bank runs across multiple countries,” he predicted. “Citigroup, for example, may not be exposed to Greece, but it may be exposed to Portugal, Spain, France. … It may be exposed to a company that’s exposed to France or exposed to exports to EU.”

In a worst-case scenario, he said, “you’re talking about widespread defaults in the corporate sector as well as the sovereign sector. It becomes very problematic.”

Even so, most major European stock markets closed Wednesday virtually unchanged. And leading Asian indexes did not show any dramatic movements in morning trading Thursday.

The euro gained some ground against the U.S. dollar on Thursday but remained close to a four month low.

European leaders were united Wednesday in saying they want to help Greece stay in the euro.

As Greek politicians met to set the new election date, German Chancellor Angela Merkel said she regrets the suffering of the Greek people in the face of harsh government budget cuts.

“It’s very bitter, obviously,” she said of the austerity measures that have left some Greeks struggling to pay for food or utilities.

But, she said, “Sacrifices had to be made. … I think these are necessary measures that had to be taken.”

Merkel, a champion of forcing governments to balance their budgets in order to promote stable economic growth in Europe, did offer possible assistance to Greece.

“Europe needs to show solidarity and help, particularly with growth, unemployment and development,” she said.

The head of the European Union’s executive body, the European Commission, said Wednesday that Greece is “part of our family,” and that the EU will do what it can to keep Greece in the euro and the union.

But the final decision has to come from the Greek people, Jose Manuel Barroso said.

“We are fully aware that the present situation is asking a lot of the Greek people, with many sacrifices. But this is a result of policies made in the past,” he said.

“The program for Greece is the least difficult of all the difficult alternatives. The problems it addresses are real,” he warned.

Merkel and Barroso spoke after news of the big withdrawals of euros from Greek banks, prompting the president of Greece’s central bank to warn that panic is possible but is not taking place.

Greeks pulled about 800 million euros out of the banking system Monday, President Karolos Papoulias said.

He said he had spoken to Central Bank Governor George Provopoulos about it.

“There is, of course, no panic, but there is fear that could develop into panic,” Papoulias said, describing what the bank governor told him. “He also said that the strength of banks is very weak at the moment.”

Merkel said she is working to keep Greece in the eurozone, but she refused to be drawn into talk about what would happen, if Greece did not meet its debt obligations.

The head of the European Central Bank echoed Merkel’s remarks.

“I want to state that our strong preference is that Greece will continue to stay in the euro area,” Mario Draghi said in a speech in Frankfurt on Wednesday.

The European Central Bank and International Monetary Fund have been pumping money into Greece to keep the country in the euro and able to pay its debts, but they have demanded that the Greek government slash spending to get the funds.

Radical leftist leader Alexis Tsipras, whose Syriza party reaped the benefits of voter frustration with the austerity measures, urged Greeks on Tuesday to continue resisting “the parties of the bailout.”

Read Tsipras equate austerity with ‘hell’

“They asked us to leave the country without any hope,” he said, arguing that the May 6 election had made the terms of the bailout “null and void.”

New Democracy leader Antonis Samaras, meanwhile, said his party will “keep fighting for a developing Greece within Europe” and “against those who say they want to get Greece out of Europe.”

His party narrowly came in first in the May 6 elections, but opinion polls since then have suggested that Syriza would finish in first place in a new election.

Matthew Chance reported from Berlin, and Antonia Mortensen reported from Athens. CNN Business Producer Katy Bryon, CNN’s Per Nyberg and journalist Elinda Labropoulou contributed to this report.


‘Au’-sterity for gold as prices plunge

Gold prices have slid in tandem with the broader stock market as Europe debt crisis fears and concerns about a slowing global economy have investors fleeing all risky assets.

Gold prices have slid in tandem with the broader stock market as Europe debt crisis fears and concerns about a slowing global economy have investors fleeing all risky assets.

NEW YORK (CNNMoney) — So much for gold being a safe investment in times of market volatility.

The yellow metal has pulled back sharply in the past month and a half on Europe fears — just like stocks. At about $1,560 an ounce, gold is 13% below its 2012 high of near $1,800 back in March. Gold prices are now down slightly year-to-date.

For any investor who views gold as an alternate currency and believes that the metal’s price should move higher thanks to turmoil in Europe and worries that the euro would completely unravel if Greece exits the eurozone, think again.

Gold bugs may be forgetting that gold really thrives during times when inflation fears are running rampant. This is not one of those times. The sluggish U.S. job market, slowing growth in China and recession in much of Europe all scream global economic weakness.

“Inflation is modest because of significant unemployment, The case for gold is when the economy is getting better,” said Barry Ritholtz, CEO of Fusion IQ, a New York-based research firm. “Right now, gold is less than an ideal investment.”

Yes, gold surged to an all-time high (not adjusted for inflation) of above $1,920 an ounce last September. That was shortly after the credit rating of the United States was cut by Standard & Poor’s following the debt ceiling mess on Capitol Hill.

At that time, demand for U.S. bonds was extremely high as well. The 10-year Treasury yield was also near an all-time low. (Bond prices and rates move in opposite directions.) So it seemed last fall that gold was being viewed as a classic safe haven.

But that may have created some froth in the market for gold. Even some gold investors conceded that prices got way ahead of themselves. So this recent pullback may be the continuation of a needed correction.

“I am a bull on gold long-term. But a lot of interest in gold over the past year has been speculative. It had been due to concerns about political paralysis on both sides of the Atlantic,” said Brian Gendreau, market strategist with Cetera Financial Group in Los Angeles.

Investors may be dumping gold as they begin to realize that it may not be as safe as they thought. And you can’t really blame some long-term gold investors for cashing in now.

The SPDR Gold Shares Trust (GLD), an exchange-traded fund that invests in the commodity, is still up more than 65% since the stock market bottomed in March 2009.

Cameron Brandt, director of research with EPFR Global, a Boston-based firm that tracks mutual fund flows, noted that there has been a steady level of redemptions from gold funds over the past few weeks.

“People are looking to get back into cash and move to the sidelines. Given Europe’s troubles, there is a segment of investors that may want to be liquid either to sidestep more trouble or pounce on other opportunities,” Brandt said.

Investors in gold miners seem to be betting on further price declines as well. The Market Vectors Gold Miners ETF (GDX), which owns shares of mining leaders like Barrick Gold (ABX), Goldcorp (GG) and Newmont Mining (NEM, Fortune 500), is down nearly 20% this year.

Ritholtz, who said his firm does have a position in gold, said that having some gold investments makes sense. Gold should rise when the U.S. dollar is weakening and inflation is a worry.

But he added that the biggest problem with the metal is that it’s not as easy to objectively value it like a stock or bond. Still, he said some investors treat gold like a “cult” and refuse to believe that the prices can ever go down.

“Gold doesn’t have any earnings. It doesn’t pay you interest. It’s a shiny yellow metal. Its value only comes from its relative rarity. It should trade on supply and demand,” he said.

Gold is a commodity first and foremost, not a currency. Commodity prices, even for something like gold that doesn’t have as much commercial use as other metals, tend to closely track consumer demand. So it should be no surprise that gold prices are now tumbling.

After all, copper prices are sliding. So are the prices of silver and platinum — and just about every other commodity. Oil is at a five-month low. Wheat, corn and cotton prices are all much closer to their 52-week lows than highs.

“This should not be a surprise. There are good economic reasons for gold prices to be falling,” said Gendreau. “A slowdown in Europe and China and lower retail demand for jewelry in India and other emerging markets should lead to a soft market for gold for awhile.”

So it looks like austerity isn’t just bad news for Greece, Spain and France, it’s a downer for anyone investing in the element whose periodic table abbreviation is “Au.”

Best of StockTwits: Raise your hand if you’ve been the CEO of Yahoo (YHOO, Fortune 500) sometime in the past decade.

michellefenton:$YHOO – Good luck Mr. Loeb. U might know how to manage $, but I doubt you know anything about resuscitating a tech co.

TrendRida: Dogs don’t chase cars much anymore. Over time they ran out of ideas of what to do when they caught the car… $YHOO

I guess you could say that the resignation of Scott Thompson as CEO is a victory for activist shareholder Dan Loeb of Third Point. But Yahoo, as I point out in today’s Buzz video, is now on its seventh CEO since 2001.

It’s tough to figure out how new interim CEO Ross Levinsohn, who has a media background, can transform Yahoo. The company already has tried to emphasize content numerous times in the past decade … with little success.

MichaelComeau: $YHOO up about 30 cents premarket. I wonder if folks are betting current team is giving up and pushing for asset sales.

mojoris1977: the corporate governance reform at $YHOO is the first step monetizing Asia turning around search/display as well as deploying cash is next.

Yahoo’s best hopes may lie in finally selling some of its Asian assets and investments to partner Alibaba. Shares were up 3% Monday afternoon so shareholders may be betting that some sales may soon happen at long last.

As for turning around the U.S. search and display business, Levinsohn will face many challenges. For one, Yahoo search is largely out of his control. That’s Microsoft’s (MSFT, Fortune 500) problem. And on the display side of things, Google (GOOG, Fortune 500) is gaining ground there. So is a little social network called Facebook (FB). I don’t envy Yahoo’s management team.

The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, and Abbott Laboratories, La Monica does not own positions in any individual stocks. To top of page

Letters to the President #1211: ‘Padding the resume’

Reporter’s Note: Each day I write a letter to the president. This is no exaggeration.

Dear Mr. President,

So this big Yahoo boss has been booted for fibbing on his resume; for claiming he had some academic credentials he did not really possess. Is it just me, or does this come as no surprise?

Maybe I’m too cynical, but I assume that an awful lot of people in top spots in industry massage the facts of their experience. They inflate their accomplishments, claim honors that they have little or not right to, and hide their failures. And we…meaning Americans at large and all the businesses that keep the country running…all help, by acting as if it’s not that serious. We’ve even come up with a special language for it. When someone props up his or her resume, instead of correctly calling it “lying” we call it “padding.”

You political types do it too. Think about your campaign right now. Democrats are crowing about all the jobs that have been created during your presidency, and yet conveniently not mentioning how many have been lost. You’re talking about how you want to help young people with student loans, and yet carefully stepping around the abysmal unemployment rate among them which you’ve been unable to fix.

Romney has his own examples; ripping into your health care reforms, for instance, while constantly acting as if his own version in Massachusetts was an utterly different kettle of fish.

See what I mean? I think part of the problem is that way too many people in way too many “leadership” roles are so invested in the business winning that they’re not particularly interested in the business of being honest. Sure, you’re all being “honest enough” to stay within the guidelines of that crooked kabuki theater that passes for truth among the rich and powerful; but what power players accept among themselves every day, they’ll fire a subordinate for in a heartbeat.

So like I said, I’m just not the least bit surprised to find a corporate CEO lied on his resume. Under the circumstances, I’m frankly more surprised when I find a big player in business or politics telling the complete truth about him or herself. Now that’s a headline!

Call if you get a moment. Were you surprised by the rain this morning? I guess it was in the forecast, but it was so nice in the middle of the day on Mother’s Day I just didn’t see the clouds coming.

Regards,
Tom

Open thread: Same-sex marriage and your life

This week, President Obama announced his personal support for same-sex marriage. The endorsement came a day after North Carolina voters passed a constitutional amendment that bans gay marriage in their state.

So, we want to know – what does Obama’s announcement mean to you? Will it make any difference in your life?

With or without Romney, DC a surprising Mormon stronghold

By Dan Gilgoff, CNN.com Religion Editor

Alexandria, Virginia (CNN) – A few hundred Mormons filed into a chapel just outside the Washington Beltway one recent Sunday to hear a somewhat unusual presentation: an Obama administration official recounting his conversion to Mormonism.

“I have never in my life had a more powerful experience than that spiritual moment when the spirit of Christ testified to me that the Book of Mormon is true,” Larry Echo Hawk told the audience, which stretched back through the spacious sanctuary and into a gymnasium in the rear.

Echo Hawk’s tear-stained testimonial stands out for a couple of reasons: The White House normally doesn’t dispatch senior staff to bare their souls, and Mormons hew heavily Republican. It’s not every day a top Democrat speaks from a pulpit owned by the Church of Jesus Christ of Latter-day Saints.

And yet the presentation by Echo Hawk, then head of the U.S. Bureau of Indian Affairs, is also a perfect symbol of a phenomenon that could culminate in Mitt Romney’s arrival at 1600 Pennsylvania Avenue next year: The nation’s capital has become a Mormon stronghold, with Latter-day Saints playing a big and growing role in the Washington establishment.

The well-dressed crowd gathered for Echo Hawk’s speech was dotted with examples of inside-the-beltway Mormon power.

In one pew sits a Mormon stake president – a regional Mormon leader – who came to Washington to write speeches for Ronald Reagan and now runs a lobbying firm downtown.

Behind him in the elegant but plain sanctuary – Mormon chapels are designed with an eye toward functionality and economy – is a retired executive secretary of the U.S. Supreme Court.

A few pews further back, the special assistant to the U.S. Special Representative for Afghanistan and Pakistan sits next to a local Mormon bishop who came to Washington to work for Sen. Orrin Hatch of Utah and now leads a congressionally chartered foundation.

Mitt Romney, who would be the first Mormon president if elected, is the son of a cabinet secretary under Richard Nixon.

“In a Republican administration, there will be even more Mormons here,” whispers the bishop, Lewis Larsen, pointing out prominent Washingtonians around the chapel. “Every Republican administration just loads up with them.”

Regardless of which party controls the White House, Mormonism in Washington has been growing for decades.

When Larsen arrived in Washington in the early ’80s, there were a just handful of Mormon meetinghouses in northern Virginia, where he lives. Today, there are more than 25, each housing three separate congregations, or wards, as they’re known in the LDS Church.

“There’s been an absolute explosion in Mormon growth inside the beltway,” Larsen says before slipping out of the pew to crank the air conditioning for the swelling crowd.

The LDS Church says there are 13,000 active members within a 10-mile radius of Washington, though the area’s Mormon temple serves a much larger population – 148,000 Latter-day Saints, stretching from parts of South Carolina to New Jersey.

Signs of the local Mormon population boom transcend the walls of the temple and meetinghouses.

Crystal City, a Virginia neighborhood just across the Potomac River from Washington, has become so popular with young Mormons that it’s known as “Little Provo,” after the Utah city that’s home to church-owned Brigham Young University.

Congress now counts 15 Mormon members, including Senate Majority Leader Harry Reid, according to the Pew Forum on Religion and Public Life. That means the 2% of the country that’s Mormon is slightly overrepresented on Capitol Hill.

Senate Majority Leader Harry Reid, a Democrat, is the highest-placed elected Mormon in Washington.

Even many Latter-day Saints joke about Washington’s “Mormon mafia” – referring to the number of well-placed LDS Church members across town – though they cringe at the thought of being seen as part of some cabal. (Echo Hawk, for his part, left the Obama administration a few weeks after his chapel presentation for a job in the LDS Church hierarchy).

“No one talks about Washington being an Episcopalian stronghold or a Jewish stronghold,” says Richard Bushman, a Mormon scholar at Columbia University. Talk of “Mormon Washington,” he says, “represents a kind of surprise that people who were thought of as provincial have turned up in sophisticated power positions.”

Bushman and other experts note that, despite Mormons’ growing political power, the official church mostly steers clear of politics. It’s hard to point to federal legislation or a White House initiative that bears distinctly Mormon fingerprints, while it’s easy to do the same for other faiths.

For example, the White House’s recent “compromise” on a rule that would have required religious groups to fund contraception for employees was mostly a reaction to pressure from Roman Catholic bishops.

Nonetheless, Mormon success in Washington is a testament to distinctly Mormon values, shedding light into the heart of one of America’s fastest-growing religions.

And though the official church is mostly apolitical, most rank-and-file Mormons have linked arms with the GOP. Romney’s own political evolution mirrors that trend.

Such forces help explain why Mormons’ beltway power is poised to grow even stronger in coming years, whether or not Romney wins the White House.

‘A ton of Mormon contacts’

For many Washington Mormons, religion plays a key role in explaining why they’re here.

Larsen, who sports a brown comb-over and tortoise shell glasses, arrived in Washington in the early 1980s as an intern for Hatch, also a Mormon.

He landed the internship courtesy of Brigham Young University, his alma mater. The Mormon school owns a four-story dorm on Pennsylvania Avenue, not too far from the White House, which houses 120 student interns each year. It’s the school’s largest such program in the nation.

“Part of our church’s tradition is to be connected with civic life, to make our communities better,” says BYU’s Scott Dunaway, who helps place students on Capitol Hill, at the Smithsonian and other Washington institutions. “We don’t believe in being reclusive.”

It’s a perfect characterization of Larsen. He grew up in Provo, in the shadow of BYU, and wanted to prove he could make it outside of Utah.

“Kids growing up in the LDS Church have been told, ‘Go ye out in the world and preach the gospel of Christ – don’t be afraid to be an example,’ ” Larsen said, sitting in the glass-doored conference room of the foundation he runs on K Street.

“So we are on our missions, converting people to Christianity,” he continued. “And coming to Washington, for me and probably for a lot of people, came out of that interest. We see it as our career, but also we’re going out to preach the word of Christ.”

For Larsen, that usually means correcting misinformation about Mormonism or explaining Mormon beliefs and practices – you really don’t drink coffee, ever? – over lunch with co-workers or at business functions, rather than on-the-job proselytizing.

He learned about integrating work and faith from Hatch. He was initially shocked to discover that the senator prays in his office each morning. Larsen and Hatch developed what the bishop calls a “father-son” relationship, with the intern rising up through the ranks to become Hatch’s chief Washington fundraiser.

“We would go on trips, and I’d quiz him on the plane: Why did the church do this? Why didn’t the church do this?” Larsen said. “He was like a tutor to me.”

Now, as the head of a foundation that educates teachers about the U.S. Constitution, the bishop helps other young Mormons with job leads and introductions. Larsen was appointed to the role by Hatch and the late U.S. Sen. Ted Kennedy.

Much of Washington’s Mormon professional network is still anchored by BYU, which operates a handful of big, well-connected alumni groups with major Washington chapters. The most prominent is BYU’s Management Society, a global organization whose biggest chapter is in Washington.

At the chapter’s recent alumni dinner, former Secretary of State Condoleezza Rice was the guest of honor. She has strong ties to the Mormon community and has hired Mormons as top aides. Says Larsen: “Condi’s got a ton of Mormon contacts.”

Patrice Pederson also knows how to work a Rolodex. A lifelong political activist, she moved from Utah to Washington last year and soon tapped into BYU’s local network.

Pederson served as the U.S.-based campaign manager for Yeah Samake, a Mormon running for president in the West African nation of Mali.

Samake traveled frequently to the U.S. to raise money and build political support, so Pederson enlisted the help of BYU’s Management Society and other groups to host events for the candidate.

Both in Washington and across the U.S., many Mormons are watching his candidacy.

“Members of the church on Capital Hill were anxious to introduce the candidate to other members of Congress,” says Pederson, sipping an herbal tea (Mormons eschew black leaf teas) in a strip mall Starbucks near her apartment in Alexandria, Virginia.

“It’s cool to have a member of the church running for president in Africa.”

Beyond making connections, many Washington Mormons say the LDS Church provides an ideal proving ground for careers here.

Unlike most churches, it has no professional clergy; from the bishop to the organist, each role is filled by everyday Mormons, most of whom have other day jobs. As a result, Mormons take church leadership roles at an early age, speaking publicly at Sunday services almost as soon they learn to talk.

“My kids grew up in the church, and we get together for three hours on Sundays, and each member needs to get up and speak,” says U.S. Rep. Jason Chaffetz, R-Utah. “By the time they graduate, they have all these speaking assignments that other teenagers just don’t have.

U.S. Rep. Jason Chaffetz, a Utah Republican, says Mormonism provides ideal training for aspiring politicians.

“For those who grow up in the Mormon church, they are taught skills that allow them to be successful in a tough city like Washington,” says Chaffetz, who converted to Mormonism shortly after college.

Young Mormons also hone leadership skills by serving missions away from home. The missions last from one and half to two years and happen when Mormons are in their late teens and early 20s and often include intensive foreign language training.

“Young Mormons are more formidable in public settings and international settings than others,” says Terryl Givens, a Mormon scholar at the University of Richmond. “Normally you would have to acquire more age and work experience before you feel comfortable and useful at NGOs and think tanks.”

Chaffetz, whose son is serving a mission in Ghana, says the experience is the perfect preparation for political careers.

“They learn rejection early on,” he says. “If you’re going to be in politics, that’s a pretty good attribute.”

Christina Tomlinson served her mission in nonexotic Fresno, California. But working with the Laotian community there, she acquired the foreign language skills that landed her first internship at the U.S. State Department.

“I look back at that and it’s nothing but divine providence,” Tomlinson says one night at an office building-turned-chapel in Crystal City, after a weekly discussion about Mormon teachings. “I would have never made those choices.”

When she arrived at her foreign service orientation in the late 1990s, Tomlinson was surprised to find that a half-dozen of her State Department colleagues were also Mormon. The thriving LDS community at State even runs its own e-mail list server so Latter-day Saints can find each other wherever in the world they’re stationed.

Like former presidential candidate Jon Huntsman, who used the Mandarin language skills acquired through a Mormon mission to Taiwan to help secure his job as President Barack Obama’s previous ambassador to China, Tomlinson leveraged her mission to get ahead at State, where she now serves as special assistant to the U.S. Special Representative for Afghanistan and Pakistan.

“I’m basically the chief of staff for the president’s representative charged with implementing U.S. foreign policy towards Afghanistan and Pakistan,” she e-mailed on a recent plane ride back from the region.

Language skills acquired on a Mormon mission helped Christina Tomlinson get her start at the State Department.

At the point of a bayonet

Like many Mormons, Tomlinson says her professional life is driven by a faith-based patriotism that sounds old-fashioned to modern ears: “I just really wanted to serve my country.”

But that distinctly Mormon patriotism was hard-won. From their very beginning, Mormons had tried to forge a special relationship with Washington. And for decades, they failed.

Joseph Smith, who founded Mormonism in the 1830s, petitioned the U.S. government to protect his fledgling religious community from the violent persecution it was experiencing, even meeting repeatedly with President Martin Van Buren.

But Washington refused, provoking Smith – who Mormons consider their founding prophet – to run for president himself in 1844. He was assassinated by an anti-Mormon mob in Missouri well before Election Day.

In the face of such attacks, Mormons fled west, to the territory that’s now Utah. But they continued to seek ties with Washington, dispatching representatives to the capital to lobby for statehood.

Congress refused to grant it. Instead, Uncle Sam disincorporated the LDS Church and sent the U.S. Army to police Mormon territory.

In the eyes of Washington, Latter-day Saints were flouting federal law by practicing polygamy. The feds saw the LDS Church as an undemocratic rival government that threatened Washington’s power.

Joseph Smith, Mormonism’s founding prophet, ran for president in 1844 but was killed before Election Day.

Mormons would eventually ban polygamy, paving the way for Utah statehood in 1896. But Congress nonetheless refused to seat the new state’s Mormon senator, who also served as a top church official.

For four years, the U.S. Senate held hearings to grill U.S. Sen. Reed Smoot and other church leaders, alleging that Mormons continued to practice polygamy despite promises to the contrary.

“The political trial was as much a galvanizing cultural moment as was Watergate,” says Kathleen Flake, a scholar of Mormonism at Vanderbilt University in Tenneessee.

When Smoot was eventually seated – after the LDS Church took further steps to stamp out polygamy – he managed to become a Washington powerbroker. He would chair the Senate Finance Committee and act as a presidential adviser.

“He was Mr. Republican,” says Flake. “For a while there, he was the Republican Party.”

Smoot’s unflagging pursuit of legitimacy in Washington, despite the city’s bias against him and his faith, symbolizes what many call a uniquely Mormon appreciation for American civic life. It helps explain the Mormon fascination with Washington to this day.

It may seen counterintuitive, but Mormons’ early exposure to persecution at the hands of other Americans – aided, Mormons say, by the U.S. government – wound up strengthening their patriotic streak.

In the face of attacks, Mormons clung to the U.S. Constitution and its unprecedented guarantee of religious freedom. They distinguished between the document and those charged with implementing it.

Mormon scripture goes so far as to describe the U.S. Constitution as divinely inspired, establishing a unique environment in which Mormonism could emerge.

“Mormons are superpatriots,” says Columbia University’s Bushman. “Joseph Smith said that if the government was doing its job as laid out in the Constitution, it would protect Mormons from their enemies.”

Mormons began to shed their Utah-only siege mentality and fanned out in the early part of the 20th century. Their patriotic streak, which translated into military enlistments and applications for government jobs, led many to Washington.

That wave included J. Willard Marriott, the hotel chain founder, who launched his business career by opening an A&W root beer stand here. He would go on to forge the kind of deep political connections that would help make Willard “Mitt” Romney his namesake.

Washington’s Mormon community got another boost in the 1950s when President Dwight Eisenhower appointed a top church official, Ezra Taft Benson, as his agriculture secretary.

“Mormons took it as a sign of maybe, just maybe, we’re being accepted,” says Flake. “It signified a cultural acceptance of Mormonism. People thought Mormons believed weird things, but also that they were self-reliant, moral and good neighbors.”

As Mormons became more accepted, they became more upwardly mobile, landing in parts of the country that could sustain careers in commerce, academia and government – another reason Washington was a big draw.

By the time there were enough Mormons in the eastern U.S. to justify the construction of the first Mormon temple east of the Mississippi River, the church chose a site just outside Washington.

The temple opened in 1974, shortly after another high-profile Mormon – George Romney, Mitt’s father – left his post as Richard Nixon’s secretary of Housing and Urban Development.

“The Washington temple served as a symbol of the triumphant return of Mormonism to the east,” says Givens, the University of Richmond professor. “Mormons left from the point of a bayonet in the 1800s and the temple is this gigantic symbol that says ‘We’re back – and we’re back in the nation’s capital.’ ”

The Mormon temple outside Washington was the first such temple built east of the Mississippi River.

Unlike Mormon meetinghouses, where members meet for Sunday worship, temples are grander buildings reserved for certain rites, such as proxy baptisms for the dead.

To this day, the first monument many Washington visitors see isn’t a federal landmark. It’s the massive Mormon temple, its Georgian marble towers and gold-leafed spires looming above the trees on the Washington Beltway like an otherworldly castle.

The temple houses a J. Willard Marriott-financed mural of Jesus Christ’s second coming, which features a picture of the Washington temple itself in the background.

“Are you implying that the millennium will begin in Washington?” a temple visitor once asked Marriott, referring to Jesus’ return.

Replied Marriott: “What better place is there?”

Good at organizing

These days, the Mormon impulse toward Washington is often as much political as patriotic.

Patrice Pederson – the campaign manager for the Mormon running for president in Mali – made her first foray into politics at 15, hopping the bus from her home in the suburbs of Salt Lake City into town to intern with a Republican candidate for the U.S. House.

“I remember that when Bill Clinton was elected, I wore all black to school that day,” says Pederson, who was in junior high at the time. “I was mourning the death of liberty.”

When then-Vice President Al Gore visited Utah, Pederson protested his speech with a homemade poster that said “Blood, Guts & Gore – Healthcare’94.” (She can’t recall the poster’s exact meaning).

Pederson’s activism as a “total hardcore right-winger” continued into her 20s. She put off college at BYU to start a “pro-family” advocacy group aimed at lobbying foreign governments and the United Nations. The work brought her to Washington so frequently that she decided to relocate last year: “I had more friends here than in Utah.”

Pederson’s path to D.C. speaks to the growing Mormon/Republican alliance since the 1960s, driven largely by the emergence of social issues such as abortion and gay marriage and the rise of the Christian Right.

“In the 1950s and ’60s, Utah became Republican,” says Bushman. “It’s partly about being anti-communist, but it’s also a response to the 1960s and the decay of old-fashioned moral virtues. It’s an anti-1960s movement, and the Republicans seemed to be the party of old-fashioned virtues.”

Pederson’s roommate, Kodie Ruzicka, grew up squarely in that movement, with her mom heading the Utah chapter of Eagle Forum, a conservative Christian group founded by rightwing icon Phyllis Schlafly.

In the 1970s, when the Catholic Schlafly led a successful grassroots campaign against the Equal Rights Amendment, which would have made gender-based discrimination unconstitutional, she enlisted the help of Mormons.

To its opponents, including the LDS Church, the ERA was the work of radical feminists who wanted to upend traditional gender roles.

Much of Schlafly’s organizing was among evangelicals, and “given the sometimes hostile evangelical line on Mormons, [Schlafly’s] Mormon outreach was kind of revolutionary,” says Ruzicka, who now works at the Justice Department. “But we’re good at organizing, and we have a lot of useful structures for it, so that was useful to her.”

Today, Mormons head Eagle Forum chapters across the West, including California, Arizona and Nevada, as well as Utah.

Bridge-building between Mormons and the conservative movement helps explain the Reagan administration’s push to hire many Mormons into the White House – which further cemented the alliance. That bond continues to lure Mormons to D.C.

Ruzicka, for one, continued in the political footsteps of her mother, arriving in Washington in her mid-20s to lead a nonprofit that promotes safe haven laws, which allow young mothers to legally abandon young children at fire stations.

Beyond hot-button social issues, U.S. Rep. Chaffetz says the Mormon faith engenders support for limited government.

“The church is very adamant about personal responsibility, and for people to voluntarily participate in service,” the Utah Republican says. “There’s this feeling that service is not something that should be mandated by government.”

The LDS Church, for its part, insists it is politically neutral and that it avoids pressuring Mormon elected officials to tow a church line. “The church’s mission is to preach the gospel of Jesus Christ, not to elect politicians,” the church’s website says.

Mormon experts say the church’s support for a relatively strict separation of church and state is born of the U.S. government’s refusal to help Mormons in the face of early persecution.

And after being accused of setting up a rival government around the turn of the last century, the church is loath to be seen giving marching orders to LDS politicians.

The church did, however, play a leading role in passing Prop 8, California’s gay marriage ban, in 2008. Church officials called it a moral cause, not a political one.

Plenty of critics disagree. But neither Mormon bishops nor church officials are known to lead the kind of church-based legislative lobbying efforts that Catholic bishops or evangelical leaders do.

Mitt Romney himself embodies the reluctance of Mormon politicians to connect their religion and their public policy positions, in contrast to politicians of other faiths.

That reluctance also appears to be born of anxiety over Americans’ lingering questions and doubts about Mormonism. When Pew asked Americans last year what word they associated with the Mormon faith, the most common response was “cult.”

In recent weeks, Romney’s newfound position as the presumptive Republican presidential nominee has produced a mix of excitement and worry among Mormons. That’s especially true in Washington, where politically savvy Latter-day Saints send out frequent e-mail round-ups of Mormon media coverage to their LDS networks.

“A lot of us know it’s ultimately a good thing, but it’s hard to feel like it’s a good thing because so much of the publicity is about things you wouldn’t talk about in polite company, like my underwear,” says Pederson, referring to the enduring fascination with Mormon undergarments.

Like many conservatives, Pederson is suspicious of Romney.

“I don’t like his waffling, to put it gently, on life and family issues,” she says. “But if it comes down to Romney versus Obama, hand me the pom-poms. I’ll be president of the Romney-Is-the-Best-We-Can-Come-Up-With-for-President Club.”

For now, Pederson is working with the National Right to Life Committee’s political action committee to raise money for the Romney effort, even as she makes up her mind about how actively she wants to promote his candidacy.

Some of her calculus is about weighing political reality against her conservative idealism. And some of it is about her next professional move. It’s a very Washington place to be.

Challenges of new Cambodia stock exchange

Editor’s note: Pauline Chiou is a CNN anchor/correspondent based in Hong Kong. Follow Pauline on Twitter @PaulineCNN

Phnom Penh, Cambodia (CNN) — I visited the Cambodian Stock Exchange (CSX) last September in the heart of Phnom Penh. It had officially “opened” a few months prior but no companies were listed yet. The trading room was filled with new desks and computer monitors, waiting for someone to power them on.

Fast forward seven months and the stock exchange is now starting to breathe signs of life — there is now one company trading on the exchange. On April 18, the Cambodian Stock Exchange started trading with the IPO of the state utility company, “Phnom Penh Water Supply Authority.”

As a frontier market, Cambodia is still a work in progress. The government is trying to woo international investors by throwing open its doors and virtually saying, “We will make it easy for you.” There are no capital controls. No requirements for joint ventures. International companies can own 100% of their local business in Cambodia. The only major restriction is on foreign ownership of land. With a young labor force that commands cheaper wages than China, Cambodia has been looking attractive to foreign companies. Despite these incentives, there are many challenges for the new stock exchange:

Challenge #1: Short-term Investors

Even with just one company trading, the exchange generated a lot of interest among local and foreign investors. In the first three days of trading, the share price for the water utility rose 60% above its IPO price, but by the following week, short term-investors started selling to take in profits. The stock price came down substantially. “It’s kind of a typical phenomenon for a new exchange. It happened in the Laos market and Vietnam’s market. It is no surprise to me,” says KT Han, managing director of Tongyang Securities which was the sole underwriter of the IPO. “Some people made a 50% profit within a few days. They tend to be short sighted by this fluctuation in price and it will take some time for them to understand the market and make long-term investments.”

Challenge #2: More Companies Need to List

You need more than one company to make a stock exchange thrive. Laos’ stock market opened in January 2011 and it still has only two companies trading. The volume of trade is fairly stagnant. That’s exactly what investors don’t want to see with the Cambodian Stock Exchange. Another company, Telecom Cambodia, is preparing its IPO later this year.

“I don’t see any reason why eventually you can’t have a dozen companies trading on the stock exchange. A lot of the big banks are listable,” says Scott Lewis, chief investment officer of Leopard Capital which invests in pre-emerging markets. “I know some brokers have mandates from garment manufacturers (to prepare to list).” He also believes the success of the Cambodian Stock Exchange can have a nice domino effect. If it starts to hum, brokers will publish research on both Cambodian and Laos stock exchange-listed companies, generating interest in the region. The key is to get more companies to list and greater volume trading.

Challenge #3: Proper Accounting

In order for a company to list on the CSX, it must have at least three years of proper audits prepared by an accredited international accounting firm approved by the Cambodian government. This is a tough challenge for many local, Cambodian companies. When I was in Cambodia last September, one analyst told me that he couldn’t think of one large Cambodian company that had audited financial statements. So it will take time for some local companies to get up to speed.

Challenge #4: Volatility of a Frontier Market

The government is doing its best to showcase the stock exchange. In one of the busiest traffic intersections of Phnom Penh, there is a large stock market television screen that shows the stock market moves. It generates interest among individual retail investors who can watch the stock price as they sit in traffic. Institutional investors from Japan, Korea and China have also taken a bite of the recent IPO but whether that interest can be sustained is still a big question. Cambodia is new to the game. Risk and volatility are inherent in a frontier market. Corruption is a concern even though the government passed an anti-corruption law in 2010.

Han is very frank about the risks. “In general, the lack of a capital market infrastructure can be a challenge for investors,” he says. “The cost of capacity building can be a challenge for investors who are not familiar with a market like Cambodia. In terms of corporate governance (e.g. accounting, business ethics), there’s a long way to go for local family-owned businesses. But once you understand the market here, there can be more opportunity than risk.”


US Treasury sanctions take aim at al Qaeda, rogue regimes

By Jamie Crawford

David Cohen’s office has set its sights on a key target since its inception in 2004: drastically reducing al Qaeda’s ability to attack and finance its operations.

The results have been clear, the U.S. Treasury’s undersecretary for terrorism and financial intelligence said Thursday.

The core group of al Qaeda “is in a much weaker state than it was” even two years ago, said Cohen, who oversees U.S. efforts to choke off the funding for bad actors and rogue regimes around the world.

International sanctions from the United States and other nations have greatly reduced the ability of the core group of al Qaeda, thought to be based in northwestern Pakistan, to formal financial networks to move and raise money, he said.

But even so, Cohen said, al Qaeda’s affiliates – particularly in North Africa – have found other ways to boost the terrorist group’s coffers, including kidnapping ransoms to the tune of “tens of millions of dollars” since 2008.

That “leading edge” of terrorist financing is an area of particular concern to the United States, he said.

The Treasury Department has the authority to sanction individuals known to be the money men behind these operations, Cohen said, and a U.S. policy of not paying ransom does have an effect.

“We have seen that hostage-takers are less likely to take Americans as hostages, because they recognize that there is not a pot of gold at the end of this enterprise,” Cohen said.

But al Qaeda isn’t the only target that has kept Cohen’s office busy this year, the Treasury official said, speaking at the Center for Strategic and International Studies in Washington.

In March, his office sanctioned an Iranian airline and trading company for their roles in shipping weapons to Syria and countries in Africa. Many senior Iranian officials and front companies for the country’s elite Islamic Revolutionary Guard Corps-Quds Force have been targeted as well.

And with additional sanctions targeting Iran’s oil sector and central bank set to take full effect next month, Tehran is feeling the heat of efforts aimed at curtailing Iran’s nuclear program, Cohen said.

There has been a “very significant deterioration in the Iranian economy” since last autumn, Cohen said.

“The value of their currency has dropped like a rock, and that has a significant impact on Iran’s ability to pay for the material it needs for its nuclear program,” and more broadly, it puts pressure on the regime as more and more citizens get squeezed, Cohen said.

In a speech marking the Persian New Year in March, Ayatollah Ali Khamenei urged Iranians to support domestic production to stave off the debilitating effects of international sanctions.

Syria, too, has seen many members of President Bashar al-Assad’s regime and family targeted by the United States. Close to 50 Syrian individuals and institutions have been designated under U.S. sanctions, Cohen said.

While Syria’s GDP grew approximately 6% in 2009, Cohen said the Syrian economy is contracting significantly under the weight of international sanctions, and the nation’s currency has plummeted in value. The loss of revenue from oil and tourism – Syria’s largest economic sectors – has contributed to huge budget deficits as revenues fall and spending explodes while the regime works to maintain power, Cohen said.

Since the violence began over a year ago, there has been a degree of “capital flight” from Syria, Cohen said.

The trick in targeting sanctions, he said, is to recognize the difference between the flow of assets legitimately leaving the country as a means of escaping the violence, versus assets that the regime and its allies are shielding.

The state-run Syrian Arab News Agency has described sanctions by the United States and European countries as “unjustified,” “illegal” and “inhumane.”

Cohen said Thursday that financial pressure on Syria’s elite will continue.

“The objective of that is to encourage the business class in Syria to recognize that their future prosperity, the preservation of their wealth, their children’s future – economic stability – depends on Assad leaving power,” Cohen said, “and peeling away that business community support from the regime is one of the important objectives that we are pursuing through these sanctions.”