PAL PILLAI/AFP/Getty Images

Forbes reported recently that the world's first billion-dollar home is currently under construction in India. Mukesh Ambani, the CEO of the petrochemical company Reliance Industries Limited and India's wealthiest man (5th richest in the world) is building a 27-story skyscraper on 4,500 sqare meters of land his company purchased 6 years ago. Apparently, the 22-story tower where the family currently lives was beginnning to feel a little cramped. The new digs will soon house the Ambani family and nearly 600 staff members in a space the size of nearly seven football fields.

The Ambanis' dream home, which they are calling "Antilla," has sparked some controversy in Mumbai. Reliance Industries purchased the land -- the site of a former orphanage -- at an auction in 2002 for just over 5 percent of its market value. That sale is now in dispute because the land was donated as a Waqf, an Islamic religious endowment (much like a trust) set aside to house Muslim orphans in perpetuity. The Waqf's board has petitoned to stay the construction of the building, but the courts have ruled that construction can go on. 

Antilla, which is expected to be completed in September, boasts some of the most luxurious accomodations in the world, including a movie theater, six floors dedicated to parking, a replica of the gardens at Babylon, an 'entourage room' where security staff can relax, and an ice room with man-made snow for seeking relief from the Mumbai heat. I wonder what the orphans did without an ice room?

In the United States, the Oreo cookie is a classic. Millions of American children have enjoyed dunking the sweet treat -- white cream sandwiched between two round, crisp, chocolate cookies -- in milk as an afternoon snack.

Kraft Foods, makers of the Oreo, introduced the cookie to China in 1996. But the Chinese didn't exactly take to them. So starting in 2005, the Wall Street Journal reports, Kraft engaged in a classic case of adapting a product to suit local tastes. The Chinese found the cookies too sweet, so Kraft reduced the sugar in them. China was developing a thirst for milk -- a product that traditionally hasn't been a Chinese dietary staple -- so Kraft launched a campaign, complete with Oreo ambassadors, to "educate" the Chinese on how to dunk the cookies in milk.

The most radical change was in the shape. Noticing that sales of wafer cookies were increasing faster than those of traditional biscuit-like cookies, a new version of the Oreo was created: a long, narrow, layered stack of crispy wafers and vanilla and chocolate cream, all coated with chocolate. Whoever said Oreos have to be round?

Of course, amid rising food prices and increased demand for chocolate (whose consumption in China has nearly doubled in the past five years), the success of the Chinese Oreo brings to mind the broader question of "Can the World Afford a Middle Class?," a topic recently addressed in FP and one that fans the flames of Chinese frustrations with the West.

(Meanwhile, Oreos have been trying to colonize British biscuit tins, the BBC reports.)

I noted in January that 2007 had been an especially good year for Mosaic, one of the world's largest fertilizer companies and a top performer on Wall Street. Since then, the market has only gotten better for the Minnesota-based company. Here's an updated chart of Mosaic's stock price for the past year:

The St. Petersburg Times has a great interview with James Prokopanko, Mosaic's CEO. Chew on these stats, which go a long way toward explaining what is happening to the fertilizer business:

• It takes five years to get a phosphate (fertilizer) plant up and running
• Ammonia costs have tripled over the past decade
• Sulphur costs have gone from $55 to $450 in the past year
• Ocean shipping costs have gone from $35 to $100
• Morocco, "the Saudi Arabia of phosphate," has raised phosphate prices from $55 to $250 a ton. They're headed for $400 a ton
• China has imposed a 135 percent export tax on fertilizer
• The Indian government will dole out more on fertilizer subsidies in 2008 than it spends on its military

For more on fertilizer, check out today's New York Times story on the subject.

Iran's prosecutor general rails against the "onslaught" of such Western toys as Barbie, Batman, Spiderman and Harry Potter.

Reader Jonathan Hendry wrote in with some interesting backstory related to my post about Apple, Inc. becoming a defense contractor:

Actually, [Steve] Jobs isn't a stranger to selling to the Pentagon. While his products are thought of as consumer electronics, there was a time when his best customers were in very serious industries like defense and high finance (UBS, Swissbank, Merrill Lynch, First Chicago, Soros, etc).

Jobs' company NeXT Computer (which Apple bought in 1997, bringing him back into the fold) sold quite a few machines to the spooks in the early 90s. The spy agencies liked how quickly software could be developed on the NeXT operating system. I personally interviewed for a defense-oriented NeXT programming job with, I think, Lockheed-Martin back in 1994, my senior year of college. (I don't recall what the system was, but I know I would have needed a security clearance - they gave me the forms to fill out. I wound up taking a job in Chicago that put me on a contract at Swissbank.)

Around 1993, NeXT stopped making computers, changing to an OS-only strategy. Supposedly they had to run the assembly line for a little while longer, in order to fulfill the spare-parts stock requirements of their defense contracts.

I expect Mr. Jobs is feeling a little deja vu right now.

Jonathan's email reminded me that the Pentagon has recently begun integrating Apple computers to bolster its network security. So, high-profile defense contracts are nothing new to the most powerful man in business.

Steve Jobs's shop recently announced the $278 million purchase of a small computer-chip maker named P.A. Semi—a takeover that most analysts assumed was designed to shore up efficient chip technology for future versions of the iPhone.

But it turns out some of P.A. Semi's best customers are defense contractors, including Lockheed Martin and Raytheon, and they're not at all comfortable with the company's new latte-drinking, yoga-practicing, peacenik boss. Rumors are flying that Apple will shut down production of a key processor used in "more than 10" different defense systems.

EE Times reports: 

Apple Inc. may have to face the ire of the U.S. Department of Defense following its planned acquisition of P.A. Semi Inc. The startup's PWRficient processor is designed into DoD programs in every major branch of the armed services, said one P.A. Semi customer who expects Apple will end production of the parts.

"We've had customers saying they are going to the DoD on this one," said a source in one of the several companies making embedded computer boards with the processor.

Lends new meaning to the term "iPod Killer," doesn't it?

VALERY MELNIKOV/AFP/Getty Images

Do you find Vanity Fair and Vogue just a bit too bourgeois? Are you tired of lumpen-proletarians who don't know their place trying to friend you on Facebook? Can you never find anything on TV classy enough to show on that sweet plasma screen you had installed in your breakfast nook? Well then Snob may be for you!

"Bad-boy oligarch" Mikhail Prokhorov, who at 42 is Russia's fifth-richest man and the country's "most eligible bachelor," is investing $150 million in a new lifestyle media brand called Snob. The brand will include an exclusive social networking site, magazine, and TV station, all aimed at upwardly mobile young Russians.

Prokohorov, who made his fortune by investing in nickel and gold during the 1990s, is a kind of poster boy for the champagne-drinking, Mercedes-driving set that Russians derisively refer to as "new Russians." His motivtion for this project, he says, is to reclaim the word "snob" from its connotations of unearned privilege and make it a kind of rallying cry for Russia's nouveau riche:

Snob to us means a person who is a 'self-made man', a person who has gained a right to snobbishness," he said emphasizing the main difference with the British meaning which he said referred to inherited wealth.

The Snob media empire aims to focus on "lifestyle features, business news and travel." If Prokohorov's personal hobbies are any indication, the snob lifestyle also includes skiing, art collecting and upscale prostitution rings.

From Shanghaiist comes this disturbing story of a young American attacked by a mob of angry Chinese outside a Carrefour store in Zhuzhou, Hunan Province, on Sunday night:

Last night [Sunday, Apr. 20] around 7pm my friend was attacked by a mob of about 150 people outside the Carrefour in Zhuzhou, Hunan.... When leaving Carrefour some of the crowd started shouting at him and he tried to say he didn't have anything to do with the Olympics, but 3 men started to push him and then he was hit in the back of the head at least 3 times. He started to run, and the mob chased him. He jumped into a cab, but the mob surrounded the car and started shaking and rocking it. The cab driver was shouting at him to get out. Then they started hitting the car. The crowd was shouting "kill him! kill the Frenchman." He called the Field Director while in the back of the car. The cab driver abandon the car when he saw police coming. Two police made there way though the mob and managed to drive the cab away. The Field Director alerted.... The police got him another cab and he took it from Zhuzhou to the field director's home in Changsha. He spending the night here in Changsha and is likely leaving China as soon as possible.

The French supermarket chain has been under siege in China over the past week. And it's hardly alone. A similarly disturbing, though less violent, episode took place last week right here at home -- at Duke University -- when a 20-year-old freshman from China who had tried to encourage dialogue between Chinese student demonstrators and a smaller group of Tibetans found her personal information published on the Internet. Hundreds of thousands of angry and threatening posts appeared on Chinese Web sites. Back in China, the student's parents were threatened and had to go into hiding.

It's all part of an increasingly scary rise in nationalism on the mainland. According to the IHT, Beijing has encouraged such nationalistic fervor to run amok by easing up on restrictions on online forums in recent weeks. If true, that news is disturbing. Because in just a few months, 500,000 foreign tourists will begin arriving in China for the Olympics. What kind of welcome are they going to receive?

(Hat tip: Passport reader hdp)

China Photos/Getty Images

I remember when the first McDonald's opened in Moscow in 1990. There was something powerfully symbolic about seeing tens of thousands of Russians lined up to get a taste of America. It meant communism was on the way out. Capitalism had won. And Muscovites were waiting hours in the cold to get a "Big Mak" just to prove it. The store needed 27 cash registers and seating for 700 just to accommodate the crowds. Young Russians left jobs at coveted scientific institutions in order for the chance to earn 1.5 rubles an hour making fries for Ronald McDonald. Take that, Mr. Gorbachev.

Put bluntly, the whole thing felt like a victory. Eighteen years later, the conduct of U.S. companies with regard to the Beijing Olympics offers a different feeling indeed. Here's the slogan Coca-Cola (a company which is in bed with the Beijing Olympics to the tune of between $75 and $90 million) is using in its Chinese marketing: "Red Around the World." Yeah, you read that right. The slogan comes in the form of a jingle that makes up the centerpiece of Coke's Olympics-specific marketing efforts in country.

Now, call me McCarthyite if you want, but this rubs me the wrong way. We're talking about a country that, just a few years ago, was aggressively forcing down U.S. military aircraft and currently maintains one of the most robust -- if not the most robust -- spying platforms against the West. Now Coke, an American icon if ever there was one, is publicly envisioning the spread of "red around the world?"

Andres Kieger, Coke's director of marketing in China, says the color red isn't all that bad. "This isn't meant as a patriotic song," he says. "It is meant as an emotional song. Red is the color of a lot of good things." Presumably he was referring to Coke cans and not the nationalistic symbols of, say, Soviet Russia or Nazi Germany. Had someone at Coke bothered to check, say, Wikipedia, they would have found multiple entries explaining that, politically at least, red is the color of communism. The phenomenon dates to the Russian Revolution, when red symbolized the bloodshed of the working class in the fight against capitalism. For the more artistically inclined, the folks at the Guggenheim explain here.

I'm all for the forces of capitalism and target-specific marketing. But somehow, kowtowing to Beijing by trumpeting the spread of Communist red just doesn't feel like a victory to me.

Getty Images

Tulsi Tanti, one India's most inspiring "green" entrepreneurs and now one of the world's richest people (worth $3 billion), is facing stiff challenges with his wind power company that could either lead to its massive failure, or its unbridled success. Tanti is hailed as one of India's most globally successful businessmen in the vein of Ratan Tata and Lakshmi Mittal -- but his company is one of the few that has given India the potential to be a worldwide leader in alternative energy.

But now Suzlon Energy, which Tanti founded and now serves as chairman and managing director for, confronts two main challenges, according to Friday's Wall Street Journal. First, the 144-foot-long windmill blades the company has sold to energy firms including California's Edison Mission Energy have begun to split in some locations, and Suzlon has had to recall 1,251 blades. That represents the majority of blades the company has sold in the United States, and a cost of at least $30 million to the company to repair the cracked blades and reinforce the rest.

The second major challenge for Suzlon is gaining access to the wind industry's most advanced technology. Suzlon is actually in a prime position to do so through its 33.6 percent ownership stake in the innovative German turbine manufacturer, REpower. The problem for Suzlon, however, is that under  German law, REpower can consider Suzlon a "competitor" since it does not own a majority of the company. It is therefore not obliged to transfer its blueprints to Suzlon; Suzlon would need to buy out the minority shareholders. And REpower is refusing to share the technology at present in order to protect the interests of those minority shareholders.

Nonetheless, it's unlikely that these setbacks spell major trouble for Suzlon. As of late last year, the firm had a $3.5 billion order backlog, and wind power demand in general has been growing significantly. With its green credentials and the fact that oil is continuing to hit record highs, wind power is set to remain popular. Moreover, Suzlon has withstood plenty of other challenges since its founding in 1995: the withdrawal of tax breaks in India, competition with major Western companies to acquire other foreign firms, and overseas expansion -- including cracking into the U.S. and Chinese energy markets. Suzlon's annual sales amount to $1.8 billion, and its profits are growing. The WSJ reports that it probably won't be able to make a tender offer for REpower until 2009. Even so, given Suzlon's history I'm expecting the deal to go through, and for Tanti to look back on these problems as minor glitches. And if you live in the United States, don't be surprised if part of your electricity payments soon end up in Suzlon's coffers.

SAUL LOEB/AFP/Getty Images

They've been criticized for their lack of transparency. Many politicians and commentators have raised fears about their potential to "buy up" important assets outside their home countries. And now, sovereign wealth funds (SWFs) -- government-controlled funds that are investing in stocks, bonds, and commodities everywhere from Australia to the United States -- are being hailed as the next great hope for Africa.

Last week, World Bank President Robert Zoellick urged such funds to invest at least 1 percent of their proceeds in Africa -- a step that would immediately raise investment in Africa by $30 billion. The International Financial Corporation, the private-sector lending arm of the Bank, is considering creating a "fund of funds" designed to encourage SWFs to invest in African businesses.

Sounds great, right? Most people seem to think SWF investment in Africa is a positive idea and a smart move both financially and politically (in terms of bolstering the image of SWFs). But Zoellick's idea could end up doing more harm than good, for two main reasons.

First, SWFs are obligated to make the best investments for the citizens of their home countries. They are not in the business of aid or charity work; nor should they be. Norwegian or Kuwaiti pensioners would have every reason to rebel if their governments' surpluses went toward either speculative investments or aid projects. (This echoes Anders Åslund's argument that if anyone should fear SWFs, it's citizens of the countries that have them.) If African governments are not even willing to invest in their own continent, why should others do so?

Second, SWFs must pursue investments that deliver a strong bottom line, but many of the best opportunities in Africa are in the natural-resource sector. China has already invested heavily in Sudanese oil -- not exactly a great way to underwrite healthy development in the country.

More broadly, there are good reasons why many private companies are unwilling to invest and set up operations in Africa. Why else would Zoellick and others be pushing SWFs to fill the equity void in the first place? Corruption, lack of security, and failure to protect property rights are just a few of the reasons countries in Africa have failed to create a positive investment climate. If SWFs step in with billions of dollars, they may well undermine efforts to promote good governance. In the long run, it is those efforts -- not easy cash from Abu Dhabi or Beijing -- that will attract private investment and generate sustainable economic development. So, although an extra $30 billion for Africa should be welcomed, SWFs may not be the best way to deliver it.

It can be tough to get out of the shadow of a famous sibling, and that's especially true if you're an airplane enthusiast and your brother is the world's most famous terrorist. Luxury goods entrepreneur and aviator Yeslam bin Ladin, half-brother of Osama, just can't see why anyone would find it odd that he's launching a line of specialty watches for pilots.

To be fair to Bin Ladin (he spells his last name differently), he has publicly denounced terrorism and hasn't had any links with his notorious younger brother for decades. It's also worth remembering that they are only two out of 54 siblings, but I still have a hard time believing that Yeslam didn't anticipate the aviation theme being an issue. Ironically, their father Mohammed died in a plane crash.

The watches sell for up to $9,472. If you're feeling flush, you can also buy "Yeslam" brand perfume and handbags from his store in Geneva, Switzerland. In the future, Bin Ladin may want to avoid adding some other items to his line, such as digital timers or vests.

DMITRY ASTAKHOV/AFP/Getty Images

As many of you know, I have been blogging this week from the Salzburg Global Seminar’s session on Russia: The 2020 Perspective.

Most of what I've written so far has been focused on U.S. policy toward Russia. But the United States can only influence Russian domestic developments on the margins. So, what does Russia itself need to do over the next 12 years?

If I were president of Russia, my absolute top priority would be to strengthen property rights, which will make it possible for Russia to diversify its economy away from oil and gas, build a real middle class, and bring in much-needed foreign investment and advanced technology. There is much work to do. Exhibit A: the case of Hermitage Capital Management Limited, which until recently was the top portfolio investment fund working in Russia.

Hermitage CEO Bill Browder, you may recall, made news in 2005 when he was suddenly barred from reentering Russia. Browder had been making too much noise about "shareholder rights," and in doing so he apparently stepped on some powerful toes. The fund has since pulled its $4 billion worth of investments in Russia, but new details are emerging that paint a disturbing picture of the business environment in the country. Last week, Hermitage updated its investors on a campaign of "administrative harrassment" in Moscow that could have ended with corrupt local officials absconding with hundreds of millions of dollars worth of the fund's assets.

According to Hermitage, the story goes like this. In summer 2007, its offices were raided by the Moscow Interior Ministry, supposedly as part of an investigation into Kameya, a company owned by one of Hermitage's clients. The allegation was that Kameya owed $48 million in taxes. When Kameya's people went to clear things up with the Tax Ministry, officials there confirmed in writing that in fact, the company was eligible for a refund and owed no back taxes. Meanwhile, when one of Hermitage's lawyers complained about the raid's questionable relevance to Kameya, he was beaten by Interior Ministry goons, arrested, and fined 15,000 rubles for his insolence.

So, what was going on? Hermitage alleges that "a more sinister agenda" was at work. The real purpose of the Kameya raid was for Moscow Interior Ministry officials to get their hands on documents that could be used to seize the fund's assets.

Here's how the attempted scam worked. The Moscow Interior Ministry official in charge of the "investigation" launched what Hermitage calls a "fishing expedition" to locate the fund's assets -- demanding all records from four foreign banks that might lead him to the prize. At the same time, somebody used the captured documents to fraudulently change the ownership of three investment vehicles owned by British bank HSBC, a Hermitage trustee. From there, it gets complicated, but the bottom line is that a mysterious team of lawyers representing "their" companies then assented to a fake court ruling that would have put the three HSBC entities on the hook for $380 million. Luckily for Hermitage, the vehicles were "dormant" and held no assets, so the would-be millionaires came up empty.

"The more we learned, the more unbelieveable it became," Hermitage says. The fund's management passed along their findings to Russia's finance minister in Davos, which were then put in front of President-elect Dmitry Medvedev and a pair of investigations has begun. The year before, though, Medvedev had personally assued Browder in Davos that his visa troubles would be cleared up, and he couldn't deliver. Now, Hermitage says the officials involved in the attempted theft are making "spurious claims" and feeding misinformation about the fund to the press -- so the fund is going public with the story.

This case will be a key test for Medvedev,  a lawyer by training who has vowed to tackle Russia's property rights and corruption problems when he takes office in May. But as European Commissioner for External Relations Bentia Ferrero-Waldner put it to us in Salzburg this week, "Ultimately the world will assess Mr. Medvedev on his deeds, not just on his words." It's showtime, Dmitry.

Blake Hounshell is Web Editor of ForeignPolicy.com. He has been blogging this week from the Salzburg Global Seminar session on Russia: The 2020 Perspective.

The Department of Homeland Security has quietly eased restrictions on U.S. companies looking to hire looking to hire non-immigrant science and technology students. It's probably a step in the right direction for immigration policy, since there's always more demand for these visas than supply. But it's unfortunate that that DHS had to use administrative procedures that are normally reserved for emergencies in order to get around Congress.

Anders Åslund predicts in today's Moscow Times that Russia's oil revenues and current account surplus will help it weather the subprime storm. In fact, the country may become increasingly attractive to Western investors:

What better safe haven for investors is there than Russia? First, the ruble is undervalued. Second, Russian equities rose moderately last year and are quite cheap by any comparison. Third, commodities are scarce and their prices have surged for long. As they have become securitized, they can easily be purchased by ordinary people. They are likely to be a prime object of speculation or just safekeeping. As a consequence, Russia's export revenues might soar even more and the economy will flourish, rendering all kinds of Russian assets -- real estate, stocks and bonds -- attractive to foreign investors. At the same time, the country's macroeconomic indicators will continue to ride and further attract investors.

The main worry, Åslund feels, is that excessive capital inflows will create a "resource curse" the fosters corruption and thwarts efforts at reform.

I would only add that if Dmitry Medvedev's government plans to attract foreign investment during the financial crisis, shakedown tactics, such as those it is currently employing against BP's Russian venture, need to go.

On Sunday, what has been described as a "game-changing" evolution in trans-Atlantic travel regulations will take place, when the open-skies agreement takes effect. Current regulations force carriers to base flights out of their own countries only, and place restrictions on which airlines can use which airports. The new agreement means that any airline can fly from any city to any airport. The move will undoubtedly increase competition between airlines, resulting in shorter flying times and greatly reduced fares. (A new European airline is already in the works that promises to send passengers from Liverpool to Baltimore for a mere 16 bucks.)

This is great news... if you live in Europe. New fares may apply to folks on both sides of the drink, but Europeans are finding great opportunities to spend their euros in the United States, while American tourists find that a dwindling few countries even accept dollars at tourist attractions anymore.

The effect of the dollar's fall on American tourists has been much discussed, and this European travel season for American tourists is shaping up to be the most painful in a five-year-slump. Stories about $40 ice cream or $10 bottles of water are scaring American tourists away from European summer jaunts, and make lower airline prices sort of look like the free food and drinks at Caesar's Palace.

Non-stop flights from European cities will no doubt open up new American markets to European travelers. And therein lies perhaps the one consolation for the dejected American Europhile: "I may have lost Paris, but they're only gaining Detroit." I mean, where would you rather vacation?

Photos: Bill Pugliano/Getty Images News; JOEL SAGET/AFP/Getty Images

It reminds me of a joke well-known by Manhattanites: Q: "Why are New Yorkers so depressed?" A: "Because New Jersey's the light at the end of the tunnel."

Europe, welcome to New Jersey.

Last week, Serbia announced it would refrain from placing an embargo on Kosovo, whose economy has already suffered under eight years of undefined status.

Despite the announcement, legal trade between Kosovo and Serbia has dropped by an estimated 50 percent since Feb. 17, a noticeable loss as Serbia has otherwise remained Kosovo's biggest source of imports over the last 8 years.

High on the list of goods in short supply are the tasty, strangely addicting, Serbia-made treat known as the Plazma cookie. Plazma cookies and other goods have reportedly disappeared from Kosovar markets due to strict product label requirements. Since independence, Kosovo has required all products distributed in Kosovo to say "Republic of Kosovo." This is a problem under Serbian law:

A company, Serbian or foreign, can face fines of up to 1.0 million dinars ($19,000) if it mentions Kosovo as a separate territory on labels used on products sold in Serbian stores. Terms allowed are 'UNMIK/Kosovo', referring to the United Nations mission that took over the province in 1999 after NATO expelled Serb forces, 'Kosovo, Serbia' and 'Kosovo/1244', the number of the Security Council resolution that put Kosovo under U.N. administration."

According to Reuters reporters Ivana Sekularac and Shaban Buza, such discrepancies send a message of market uncertainty, curbing trade and regional investment. But Plazma has found a solution. The cookie company has simply opted to list the Kosovo distributor as in Albania. And it's a good thing, too:

Plazma are one of the most wanted and best-selling Serbian products, people really like them," said Tahir, an employee at a big supermarket in Pristina. "We tried with some similar Italian cookies, but in the end sold only two packs."

Not too surprising -- I bet the Italian cookies don't have quite the same effect.

Francois Durand/Getty Images

India's Tata Motors has just recieved a $3 billion loan from Citigroup and JP Morgan that will likely to be used to purchase luxury British auto brands Jaguar and Landrover. Tata has been in acquisition talks with Ford about the two brands since at least the beginning of the year, and the deal is now expected to be finalized around the Mar. 26.

If Tata's bid succeeds, the company would become the producer of the world's cheapest car, the $2,500 Nano, and some of its most expensive. The paradox raises the question -- will Tata be able to cut costs for its new luxury brands, whose troubles are well-known? Tata's chairman has already ruled out shifting the production of Jaguar and Land Rover vehicles from Britain to cheaper locations, though Wharton's John Paul MacDuffie believes Tata could restore the brands to profitability through other means.

For an India that was ruled by Britain for nearly ninety years, Tata's purchase will starkly reinforce the arrival of the "post-colonial" moment. As MacDuffie explains, "there might be a certain sense of pride in acquiring the 'Jewel in the Crown'." Like Tata's previous acquisition of British steelmaker Corus and teamaker Tetley, and India's United Breweries Group's purchase of Scottish whisky distiller Whyte & Mackay, Tata's acquisition of Jaguar and Land Rover would symbolize yet another "post-colonial table turn."

Tata is well aware of the potential blow to British pride. "These brands will continue to belong to Britain," Chairman Ratan Tata has assured. Except that now, they will be owned by an Indian company.

Anders Åslund of the Peterson Institute for International Economics argued recently that the real problem with so-called sovereign wealth funds is not that Arab, Chinese, and Russian governments are buying up great swathes of Western economies, but that these state-owned funds are liable to make bad investments.

China is a case in point. Last year, China Investment Corp. bought nearly 10 percent of both Blackstone and Morgan Stanley, neither of which is doing so hot right now. Blackstone has since fallen by half and Morgan Stanley by a quarter. And Citic, a Chinese bank run by the government, was all set to purchase nearly 10 percent of Bear Stearns until Friday's debacle. The only thing that saved Citic from making a terrible deal? Bureaucratic red tape in Beijing.

FT Alphaville quotes Jim Reid, a credit strategist at Deutsche Bank, in a letter to clients:

The Fed has now stepped up a gear and ultimately we probably need the US Government to do so too. Even though we believe in free markets and believe that pain should be felt after such an unruly credit binge, we also think we are close to a financial system meltdown. At this stage moral hazard arguments need to be put in a wider perspective."

While the Bear Stearns debacle is certainly alarming and the broader financial system is blinking red, we should be careful in accepting such statements at face value. Banks that have made bad bets have an interest in seeing U.S. taxpayers foot the bill for their mistakes. Nouriel Roubini, who wrote the cover story for the latest issue of FP, blogged some sharp thoughts on the moral hazard problem Friday:

Unless public money is used on a very temporary basis to achieve an orderly wind-down or merger of Bear Stearns this is another case where profits are privatized and losses are socialized. By having thrown down the drain the decades old doctrine and rule that the Fed should not lend or bail out non-bank financial institutions the Fed has created an extremely dangerous precedent that seriously aggravates the moral hazard of its lender of last resort support role. If the Fed starts on the slippery slope of providing massive liquidity support to non-bank financial institutions that have recklessly managed their risks it enters into uncharted territory that radically changes its mandate and formal role. Breaking decades-old rules and practices is a radical action that seriously requires a clear public explanation and justification.