China/US: President Barack Obama will have a friendly meeting with his Chinese counterpart Hu Jintao next week. They two countries depend on each other too much for anything else. In a few years Hu or his successor may be able to tell the American leader what to do. But not yet.

Not yet the G2, but maybe the G1?

Business Standard

Equities jumped 10 per cent three years ago, when China said it would buy up banking shares in the market. They barely budged after a similar announcement on Monday. The difference is credibility. A sustained financial crisis has shown that governments around the world have a limited ability to make things better. Beijing has a lot of credibility to lose.

The hapless club

Nomura has lost its top banker, and with him its chances of becoming a globally relevant investment bank. Jesse Bhattal, who helped broker the Japanese group&rsquo;s purchase of Lehman Brothers&rsquo; Asian and European businesses, has retired less than a year after being promoted to president of the wholesale bank &mdash; essentially everything outside Japan. At best, Nomura will muddle through. At worst, this marks the beginning of a slow retreat.

Bhattal scars

Bank of America (BofA) has set an ominous precedent in Asia, laying off 15 of its top-tier managing directors within a few weeks. It&rsquo;s not unheard of for MDs to leave the building with a pink slip, but rare that they should bear the brunt in proportion with lower and mid-level staff. BofA is under extra pressure from the US housing crisis, and had hired the odd, big, expensive name. But, the current downturn may leave big earners elsewhere exposed, too.

A little off the top

China has a sanctions dilemma. The biggest buyer of Iranian oil imported about 600,000 barrels a day in November, a third of total output. As the United States enacts new sanctions on the Middle Eastern state, and refiners in Europe pull back in anticipation of further curbs, China can choose to flout or follow. Expect it to fudge.

Flout, follow or fudge

Kazuo Hirai will take up the reins at Sony with investors&rsquo; expectations set to &ldquo;low&rdquo;. The Japanese electronics giant has forecast a $2.9-billion net loss for the year ending in March 2012, a month before Howard Stringer stands down as CEO. That gives Hirai some breathing space, but his task is still daunting.

System reboot

China is fighting for its right to pollute. The government has banned Chinese airlines from paying a pointless new European emissions tax. The argument isn&rsquo;t about the environment. It&rsquo;s about China&rsquo;s &ldquo;don&rsquo;t intervene&rdquo; foreign policy, which led it to veto a UN resolution against Syrian President Bashar al-Assad on February 4. This time, China has the moral high ground.

Whose sky is it anyway?

Glencore&rsquo;s tie-up with Xstrata may not harm competition. But, that won&rsquo;t stop regulators from trying to wrap it up in red tape for several months. As the miners head into a $90-billion all-share merger, competition watchdogs from China to South Africa, Australia and Europe, will get a chance to probe companies&rsquo; business and impose conditions on a union.

John Foley