Tuesday, June 30, 2015

Greece must be saved from political, economic and social collapse - Financial Times

June 30, 2015 at 12:07am
http://www.ft.com/intl/cms/s/0/c990f1a2-1cfe-11e5-aa5a-398b2169cf79.html#axzz3eSZQamqC

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/c990f1a2-1cfe-11e5-aa5a-398b2169cf79.html#ixzz3eSZZLVdQ

June 27, 2015 8:30 pm
Greece must be saved from political, economic and social collapse
Tony Barber


This may be the first step backwards in the harmonious integration of Europe, writes Tony Barber
 The leaders of Germany and France offered to release billions in frozen aid on Friday in a last-minute push to talk Greek Prime Minister Alexis Tsipras into contentious pension reforms in exchange for filling Athens' empty coffers until November. REUTERS/Yannis Behrakis©Reuters

In spite of the recklessness of its radical leftist-led government, in spite of the failures of the political classes that have misruled the nation since the return of democracy in 1974, in spite of the chronic clientelism and corruption of the state, in spite of the selfishness of its business oligarchies and in spite of the unerring capacity of its foreign creditors to miss the big picture, Greece must today be saved from political, economic and social collapse.
Without such an effort, which must be led by the EU, Greece will be sucked ever more deeply into the political radicalism, economic misery, organised crime, uncontrolled migration and even outright war that characterises an arc of countries from Bosnia-Herzegovina in the Balkans to Syria on the east Mediterranean coast.

It is irrelevant today to assign blame for what is shaping up as a Greek debt default and exit from the eurozone. The clock will not stop just because Greece’s eurozone partners — if “partners” is even the right word any more — have stated their patience is at an end. Greece is in south-eastern Europe, and the stability of south-eastern Europe is a matter of the highest importance to the EU and the Nato alliance.
If Plan A was to find a way of kicking the can down the road and keeping Greece in a support programme that maintained its eurozone membership, and if Plan B (now being implemented) is to protect the rest of the eurozone from Grexit, then there needs to be a Plan C. Plan C will require immediate action to prevent the implosion of the Greek economy and contain the poisonous political repercussions of the failed aid-for-reform negotiations. It will mean demonstrating to ordinary, desperately hard-pressed Greek citizens that its allies will not let down their country.
Even if these efforts achieve some success, however, let there be no doubt about the broader historical significance of what is unfolding in the Greek tragedy. It marks the first step backwards in what used to be celebrated as a steady, if sometimes wobbly, process towards the harmonious integration of Europe, a continent torn to shreds in the second world war and then divided, until 1989, into a democratic west and Soviet-controlled communist east.
The goal of harmonious European integration is now under greater threat than ever, thanks to the challenges of irregular migration, economic stagnation, Russian truculence, narrow-minded British attitudes and the appalling mishandling of the eurozone’s troubles.
But, for now, the overriding priority must be to help Greece — in or out of the eurozone.
tony.barber@ft.com

Monday, June 29, 2015

Greece’s Debt Crisis Sends Stocks Falling Around Globe - New York times

http://www.nytimes.com/2015/06/30/business/international/daily-stock-market-activity.html?hp&action=click&pgtype=Homepage&module=a-lede-package-region&region=top-news&WT.nav=top-news&_r=0

Greece’s Debt Crisis Sends Stocks Falling Around Globe
By DAVID JOLLY and KEITH BRADSHERJUNE 29, 2015


The Nikkei 225 ended 2.9 percent lower on Monday, its weakest close since June 19. Credit Thomas Peter/Reuters
Advertisement


PARIS — Stocks fell sharply in Europe and Asia on Monday, and markets in New York appeared headed for a slump at the opening, as Greece’s financial difficulties spread worries about possible broader harm to the global financial system, and Chinese investors endured another topsy-turvy session.

The Euro Stoxx 50 index of eurozone blue chips were down 3.9 percent in afternoon trading, having fallen about 5 percent at the opening. The FTSE 100 index in London was down 1.8 percent.

In Greece, banks and markets are closed until July 6, after Prime Minister Alexis Tsipras interrupted last-ditch debt negotiations early Saturday with the announcement that he was calling a referendum for July 5 on whether to accept the tough terms offered by international creditors.



Greeks lined up to withdraw cash from an Alpha Bank A.T.M. in central Athens on Sunday. Daily limits on cash withdrawals loomed as part of the government's emergency measures in the face of its fiscal crisis.Greece Will Shut Banks in Fallout From Debt CrisisJUNE 28, 2015
An anti-austerity protester burned a euro note at a demonstration in Athens on Sunday.Currency Crisis: The Next Few Days Have the Potential to Transform Greece and EuropeJUNE 28, 2015
Graffiti on a street in central Athens on Sunday. The European Central Bank said it would not expand an emergency loan program that has been propping up Greek banks in recent weeks while the government was trying to reach a new debt deal with international creditors.Cash Withdrawals and Hoarding as Default Looms Over GreeceJUNE 28, 2015
Investors have been concerned by the probability that Athens will be unable to meet a 1.6 billion euro, or roughly $1.8 billion, loan repayment to the International Monetary Fund that is due on Tuesday, with uncertain consequences for Greece’s future in the eurozone and even in the European Union.

While investors were clearly concerned about the events of the weekend, there was no sign on Monday of widespread panic. Holger Schmieding, chief economist at Berenberg Bank in London, wrote in a note that the current situation was “a tragedy for Greece,” but that it was “not a ‘black swan’ moment.”

The European Central Bank and other eurozone authorities have had four years to prepare for this moment, Mr. Schmieding wrote, and “we expect contagion control to work, by and large.”

The euro also dropped, falling 0.5 percent against the dollar, to $1.1111, as investors feared that Greece’s troubles would have a spillover effect and would make European assets less attractive.



Bonds of the most exposed European governments, including Italy and Spain, fell sharply, while their yields — or interest rates, which move in the opposite direction of prices — rose. The prices of bonds sold by countries considered safe investments, like Britain, Germany and the United States, all rose.

Greek two-year bond prices were down sharply, with yields rising to more than 32 percent. Comparable German bonds were trading to yield less than 1 percent.

With the Athens exchange closed, Greek equities in the form of American depositary receipts fell sharply in premarket trading in the United States. Those equities for the National Bank of Greece, the country’s biggest lender in terms of assets, fell more than 30 percent early Monday.


The country became the epicenter of Europe’s debt crisis after Wall Street imploded in 2008. Now, it is struggling to pay its debt, and its people and creditors are growing restive.



Greece has been struggling to find a solution to its debt troubles for years. But the speed with which its government called a referendum on the bailout terms and shut its banks appears to have caught at least some investors off guard.

“Most people’s consensus forecast was for them to muddle through with some kind of a deal,” said Kymberly Martin, the senior market strategist at the Bank of New Zealand, “so it has taken people a little bit by surprise.”

Standard & Poor’s 500 index futures were down more than 1 percent in the European morning, suggesting that Wall Street would open lower.


Greece Shuts Banks to Stem Tide of Withdrawals

Go to previous slideGo to next slide
Pensioners line up outside a closed bank in Athens on Monday. The European Central Bank said it would not expand an emergency loan program that had been propping up…Greek banks for weeks. Credit Yannis Behrakis/Reuters
1 of 9 Go to previous slide Go to next slide




In Asia, an interest-rate cut by Beijing on Saturday failed to stem the fall in Chinese stock markets beyond the first hour of trading. The Shanghai composite index closed the day 3.3 percent lower, having been down as much as 7.6 percent and after plunging more than 7 percent on Friday. In Hong Kong, the Hang Seng fell 2.7 percent.



The Tokyo benchmark Nikkei 225 stock average fell 2.9 percent, and the Australian market barometer S&P/ASX 200 fell 2.2 percent in Sydney.

The price of gold, which tends to become more popular during times of financial or political instability, climbed 0.6 percent, to $1,180.30 per ounce.




The People’s Bank of China, the country’s central bank, reduced one-year lending and deposit rates by a quarter percentage point, effective on Sunday, and reduced the reserves that some banks are required to hold, allowing them to lend more money.

The central bank had previously refrained from acting so quickly after a market downturn, so its action over the weekend was interpreted as a clear sign that the government was reluctant to see the Chinese stock markets lose their gains after doubling in the past 12 months.


“It marks a slight departure from the previous P.B.O.C. moves, because this time it looks to be directly timed as support for the equity markets,” said Erwin Sanft, the head of China strategy in Hong Kong at Macquarie Capital Securities, referring to the Chinese central bank.

Rajiv Biswas, chief economist for Asia at IHS Global Insight, said that if Greece defaulted and left the eurozone, the effects on Europe’s economy and on exporters in Asia would depend on whether European leaders could prevent financial troubles from spreading to Portugal, Spain and possibly Italy. If the damage is not contained, economic output in Asia could drop 0.3 percent next year on lower exports to Europe, Mr. Biswas said.

Ms. Martin of the Bank of New Zealand said such calculations were not at the front of investors’ minds. “I think people are still more concerned about the immediate impact, not the longer-term effects on eurozone growth,” she said.

David Jolly reported from Paris, and Keith Bradsher from Hong Kong.

Sunday, June 28, 2015

8 Epic Business Failures with Donald Trump’s Name on Them - TIME

http://time.com/money/3923629/donald-trump-name-business-failures/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+timeblogs%2Fcurious_capitalist+%28TIME%3A+Business%29

Brad Tuttle @bradrtuttle June 16, 2015  
Donald Trump


Business mogul Donald Trump gives a speech as he announces his candidacy for the U.S. presidency at Trump Tower on June 16, 2015 in New York City.

On Tuesday, Donald Trump threw his name into the ring as an official candidate for president in 2016. “I’m using my own money. I’m not using the lobbyists. I’m not using donors,” Trump explained of his candidacy, before adding a heaping dose of trademark bluster: “I don’t care. I’m really rich.”

As for why he’s running, Trump pointed to his business sense and declared, “We need somebody that can take the brand of the United States and make it great again.”

Yet time and again over the years, the Trump brand has been featured in many embarrassing high-profile flops in the business world. Here are some of the misfires attached to the “Trump” name.

Trump Shuttle
In 1989 the Eastern Air Shuttle was reborn as the Trump Shuttle, complete with a large “T” on the tails of the planes and—no joke—”gold lavatory fixtures.” The goal was to create a top-notch luxury flight service—they even paired with a company that rented laptops, which was cutting edge at the time—but the operation was hemorrhaging cash within weeks and was completely out of business by 1992.

Trump: The Game
The original catchphrase for the Monopoly-like Trump board game introduced in 1989 was the Trumpism “It’s not whether you win or lose, but whether you win!” Sales were underwhelming, to put it mildly. But after Trump became a cultural phenomenon in the reality TV show “The Apprentice,” the game was back on the market featuring a new expression: “You’re fired!”

Trump Magazine
“The Trump Brand evokes elegance and TRUMP Magazine will reflect the passions of its affluent readership by tapping into a rich cultural tapestry,” explained a 2007 press release introducing Trump Magazine. A year and a half later, the quarterly periodical, billed as a “highly anticipated ‘must read’ among VIPs and influencers,” had ceased publication.

GoTrump.com
Billed as his “biggest venture to date in the $80 billion online travel industry,” Donald Trump introduced this travel search engine powered by Travelocity in 2006. The site was supposed to host “Trump Picks” and “Trump Deals,” and it was accompanied by the introduction of The Donald’s “first-ever email address” (MrTrump@GoTrump.com) which he would be using to “offer travel tips and advice.” The site was shut down a year later.

Trump Casinos
The Atlantic City casino Trump Plaza, which was built in the 1980s at a cost of $210 million, was sold off at the “fire sale price” of $20 million in 2013, not long before several casinos shut down in the fading gambling destination. Trump insists that he cashed out the vast majority of his interests in the Trump Plaza and nearby Trump Taj Mahal long before Atlantic City property values tanked, but earlier this year he reached an agreement to keep his name on them.

Trump Mortgage
“Donald Trump is putting the suit and tie back in the mortgage business,” a 2006 press release explained of his brand new venture, Trump Mortgage. Whatever that means. Less than two years later, the suit and tie were back in the closet, or perhaps up for sale at the consignment store, so to speak, as Trump Mortgage closed up shop. Trump speedily downplayed the venture as well, saying, “The mortgage business is not a business I particularly liked or wanted to be part of in a very big way.”

Trump Steaks
AdAge described Trump Steaks, featured on the June 2007 cover of the Sharper Image catalogue, as like “a ‘Saturday Night Live’ spoof, but it’s not.”

Trump Vodka
Donald Trump made no secret of the fact that he doesn’t drink. Nonetheless, a decade ago he rolled out Trump Vodka and promised it would be “a major player in the vodka arena” because “it’s a superb product and it’s beautifully packaged,” and “there’s nobody who markets better in the luxury category than Donald Trump.” This is one “major player” that disappeared from the marketplace several years ago.

Saturday, June 27, 2015

Eyewitness to the Fall of Saigon - TIME

June 27, 2015 at 4:50pm
http://time.com/3838802/fall-of-saigon-memories/

Forty years later, TIME's former staffers remember their final days in the Vietnamese city




It was 40 years ago that Roy Rowan heard the surprising song coming through the radio in Saigon. Rowan was in the city as a correspondent covering the Vietnam War for TIME. It had been clear for weeks that the end of the war was imminent. But, until that moment, hearing a Christmas song in April, it hadn’t been clear just how soon the end would come.

“The ending was very dramatic, as everybody knows,” Rowan recalls. “The signal to evacuate was ‘White Christmas.’ I remember waking up at 3:00 in the morning and hearing ‘White Christmas’ and wondering what the hell it was going to be like trying to walk out of this place.”

Rowan is now 95, but his memory of that day is sharp. The details he summons 40 years later match those he related in the pages of TIME during those hectic weeks in 1975: the sound of the shelling, the fear of the approaching army, the sight of Tan Son Nhut airport fading away into the distance as he and his colleagues choppered away.

After a war that dragged on for years, it all happened quickly. Less than two months before, the communist forces of North Vietnam attacked in the highlands north of Saigon. The decision by the Southern forces to withdraw from that area backfired as the North continued to advance. Amid political turnover in Saigon, ceasefire proposals were rejected. The North would not rest until the Americans were gone. On April 28, the airport came under fire; President Gerald Ford made the decision to launch Operation Frequent Wind, the emergency evacuation of all Americans.


In those few weeks of warning, TIME had worked to evacuate its Vietnamese staffers, who might have faced retribution if they were left behind. It took until the last week for them and their families to get out — twice the plan had been cancelled, and Secretary of State Henry Kissinger had gotten directly involved. (Pham Xuan An was the only staffer to stay behind.) Saigon bureau chief Peter Ross Range got out around the same time.

“When the end came, it came with stunning swiftness,” Range, now 73, says, “but it was not a total surprise to most of us.”

That left Rowan, correspondent Bill Stewart, and photographers Dirck Halstead and Mark Godfrey to be evacuated on the last day. Hearing the signal to evacuate, they made their way out of the Continental Palace Hotel and to an assembly point nearby, under the watchful eye of the armed militiamen whom they were leaving behind. They ended up at the airport, under Marine guard, waiting for the word that the helicopters were ready. Later, safely on board the U.S.S. Mobile, Rowan sent the magazine a cable, which ran under the headline “This Is It! Everybody Out!”:

Just as our group of 50 prepared to leave, that rule was changed to make way for more passengers: the Marine at the door shouted, “No baggage!” Suitcases and bags were ripped open as evacuees fished for their passports, papers and other valuables. I said goodbye to my faithful Olivetti, grabbed my tape recorder and camera and got ready to run like hell. The door opened. Outside I could see helmeted, flak-jacketed Marines—lots of them —crouched against the building, their M16s, M-79 grenade launchers and mortars all at the ready.
We could view the whole perimeter.
There was a road leading to a parking lot, and on the left was a tennis court that had been turned into a landing zone.
Two Sikorsky CH-53 Sea Stallions were sitting in the parking lot. I raced for it. Marines, lying prone, lined the area, but they were hard to see because their camouflaged uniforms blended with the tropical greenery. I almost stepped on a rifle barrel poking out from under a bush as I entered the lot.
The Sea Stallion was still 200 ft. away, its loading ramp down and its rotors slashing impatiently. Fifty people, some lugging heavy equipment despite the order to abandon all baggage, piled in, one atop another: correspondents, photographers and Vietnamese men, women and children. The loadmaster raised the ramp, the two waist gunners gripped the handles of their M16s, and, with about a dozen passengers still standing like subway straphangers, the helicopter lifted off.
The confusion of the war had dissipated, leaving one indisputable fact: the U.S. was no longer in Vietnam. “Perhaps appropriately,” the magazine noted, “the American goodbye to Viet Nam was the one operation in all the years of the war that was utterly without illusion.”

On the morning of April 30, 1975—exactly 40 years ago—the last U.S. helicopter lifted off and South’s President Minh surrendered unconditionally. That afternoon, the surrender was accepted. Word came from the Provisional Revolutionary Government: Saigon was liberated, and Saigon was no more. It would be known as Ho Chi Minh city, and it was theirs.

Friday, June 26, 2015

IMF Would Be Other Casualty of Greek Default - Bloomberg

http://www.bloombergview.com/articles/2015-06-26/imf-would-be-other-casualty-of-greek-default

JUN 26, 2015 2:00 AM EDT
By Mohamed A. El-Erian
All sides are working hard to prevent Greece from defaulting on its debt obligations to the International Monetary Fund -- and with good reason: Such an outcome would have dire consequences not only for Greece and Europe but also for the international monetary system.

The IMF's "preferred creditor status" underpins its ability to lend to countries facing great difficulties (especially when all other creditors are either frozen or looking to get out). Yet that capacity to act as lender of last resort is now under unprecedented threat.

Preferred creditor status, though it isn't a formal legal concept, has translated into a general acceptance that the IMF gets paid before almost any other lender. And should debtors fail to meet payments, they can expect significant pressure from many of the fund's other 187 member countries. That's why instances of nations in arrears to the fund have been limited to fragile and failed states, particularly in Africa.

Greece's Fiscal Odyssey

The IMF has been able to act as the world's firefighter, willing to walk into a burning building when all others run the other way. Time and again, its involvement has proved critical in stabilizing national financial crises and limiting the effects for other countries.

Not long ago, it would have been improbable for the IMF to engage in large-scale lending to advanced European economies (the last time it did so before the euro crisis was in the 1970s with the U.K.). And it would have been unthinkable for the fund to worry about not getting paid back by a European borrower. Yet both are happening in the case of Greece. Moreover, compounding the unprecedented nature of the Greek situation, other creditors (such as the European Central Bank and other European institutions) are in a position to help provide Greece with the money it needs to repay the IMF. Yet that would only happen if an agreement is reached on a policy package that is implemented in a consistent and durable fashion.

If Greece defaults to the IMF, it would find its access to other funding immediately and severely impacted, including the emergency liquidity support from the ECB that is keeping its banks afloat. The resulting intensification of the country’s credit crunch would push the economy into an even deeper recession, add to an already alarming unemployment crisis, accelerate capital flight, make capital controls inevitable and, most probably, force the country to abandon Europe’s single currency.

The IMF also would be worse off. A Greek default would be the largest case of nonpayment since the institution was created in 1945. It would fuel both internal and external criticism that the fund had been co-opted by European politicians, adding to longstanding worries about the slow progress in reforming its outmoded governance, representation and some of its practices (including the “tradition” that the head of the institution always be a European). And it would make the IMF more hesitant to lend aggressively in other crises.

Fortunately, such a fate can still be avoided if Greece and its creditors succeed in completing what have been painful negotiations for all involved. If they don't, we would have to add the IMF's reputation to the casualties of a crisis that already has inflicted horrific suffering on millions of Greek citizens.

To contact the author on this story:
Mohamed A. El-Erian at melerian@bloomberg.net

To contact the editor on this story:
Max Berley at mberley@bloomberg.net

Thursday, June 25, 2015

The dangers of living in a subnormal interest rate world - Financial Times

June 24, 2015 at 6:28pm
http://www.ft.com/intl/cms/s/2/4435a95e-18fc-11e5-8201-cbdb03d71480.html?segid=0100320#axzz3dxxRYHVl

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/2/4435a95e-18fc-11e5-8201-cbdb03d71480.html#ixzz3dxxvWW7j

The dangers of living in a subnormal interest rate world
John Plender


Debt and low investment returns both present problems
Federal Reserve Chair Janet L. Yellen speaks during a press briefing at the Federal Reserve June 17, 2015 in Washington, DC. The Federal Reserve left its benchmark interest rate unchanged at near zero Wednesday, while describing US economic growth as "moderate" after the winter slowdown. But predictions made by the individual participants in the Fed's monetary policy meeting indicated most expect the federal funds rate to rise above 0.5 percent by year-end. The Federal Open Market Committee trimmed its economic growth forecast for 2015 to just 1.8-2.0 percent, down from March's 2.3-2.7 percent outlook, to account for the unexpected contraction in the first quarter of the year.
Janet Yellen has said when rises do come they will be small, incremental and predictable

It is curious to reflect that when US and UK policy interest rates were cut to their lowest ever levels in March 2009, markets expected them to be on the rise within the year. More than six years later the rates remain the same and the markets are still obsessed with the timing of a rise. When that will happen is as clear as mud in the wake of the Federal Open Market Committee’s statement last week.
The one thing that is beyond doubt is that the “normalisation” of monetary policy is a long way off. Janet Yellen, chairwoman of the Federal Reserve, has indicated that when the rises do come they will be small, incremental and predictable. For some years we will confront a subnormal interest rate world.


It will also be a low growth world — witness the downward revisions to growth projections of both the Federal Reserve and the Bank of England this month. The eurozone and Japan, despite enjoying the benefits of big competitive devaluations, are struggling to deliver half-decent growth rates.
And competitive devaluation is anyway a zero sum game that does nothing to boost the global economy. China is slowing palpably even if the official figures are disguising the underlying reality. The post-crisis assumption that emerging market economies would show the developed world a clean pair of heels now no longer holds.
Against a background of inadequate global demand the collapse in energy and commodity prices has added powerful disinflationary impetus. Wage increases in the developed world, with the notable exception of the UK just recently, have been subdued.
Forward markets are telling us that interest rates are going to be much lower than pre-crisis average policy rates since 1945 for the US, UK, the eurozone and Japan, which were respectively 3 per cent, 7 per cent, 3 per cent and 4 per cent.
In other words, the markets are saying that this time is different, a formulation that is reliably dangerous when it comes to predicting the future. Of course, some things really are different. For much of the postwar period most central banks were not independent, though whether independence has been the driving force behind prolonged disinflation is another matter, as is the question of whether central banks will remain independent in future.
Given the quasi fiscal nature of their activities since the crisis and the risk that unconventional measures pose to their balance sheets, the possibility of a political land-grab in monetary policy is not negligible.
On the other hand, liberalisation of labour markets and the decline of union power seems unlikely to be reversed in the short and medium term. Note, though, that with ageing populations, a shrinking workforce may exercise market power to grab higher wages against a retired population that tries to use voting power to secure stable retirement incomes.
The dangers inherent in a subnormal interest rate world relate, first, to the accumulation of debt. Debt of almost any size in relation to gross domestic product becomes manageable at today’s negligible interest rates. Whether it stays manageable depends on whether politicians seize the opportunity to deliver structural reforms and infrastructure investment to enhance growth, without which debts cannot ultimately be serviced.
‘Gradual’ is the word as Yellen seeks to assuage markets

US policy makers expect rates to move at pace that is exceptionally sluggish by historical standards

The snag is that low growth makes it hard to summon up the political will for reform, which tends to impede growth in the short run before producing a longer term pay-off.
Then there is the problem of dismal investment returns and the impact of low discount rates on pension fund liabilities. It is impossible to know how far pension fund deficits dampen animal spirits in the boardroom, but where pension funds are big in relation to the company, deficits cannot help.
They may well have been a factor, albeit a minor one, in the weakness of investment since 2008. Equally important, a subnormal interest rate environment reduces the scale of creative destruction and confers advantage on big companies at the expense of more productive smaller companies that lack good access to credit markets.
In such a world any reversion to the historic interest rate mean is distant. There is no generalised sword of Damocles hanging over the heavily indebted developed world for the moment. Yet for individual countries an early reversion may be the reward for bad policy. Japan and southern Europe are the laboratories in which this hypothesis will be tested.
The writer is an FT columnist

Wednesday, June 24, 2015

劫數當年誰作孽 政改罡風廢真身 - 林行止 《信報財經新聞》創辦人。

June 11, 2014 at 4:03pm
未來日子,北京對港政策,肯定愈來愈硬!

林行止:劫數當年誰作孽 政改罡風廢真身
http://bit.ly/THuPdX

國務院昨天上午公布題為《「一國兩制」在香港特別行政區的實踐》白皮書,本報網站第一時間分段刊出全文;「白皮書」最令人矚目的是指出「高度自治權的限度在於中央授權多少權力,香港特別行政區就享有多少權力」。《852郵報》及時指出「有關說法,早在二○○七年,當年的人大委員長吳邦國趁《基本法》在香港實施十周年提出」,事實確是如此;筆者當時以《我作主子你當家!》(收台北遠景社《資源吃香》)為題的評論作回應,認為「香港回歸等於香港人喪失政治權利」、「香港將成為中國的悲情城市」。結論是在香港從政,「一旦觸動涉嫌『犧牲一國』的底線,政治活躍分子將要付出代價,而這是機會成本很大的大部分港人所不願承擔的」。這點「預測」,看爭取「真普選」全面起動風起雲湧之勢,是不準確的。

「白皮書」對香港爭取普選的各方力量,尤其是以符合國際標準為依據並有對外進行游說能力的少數港人,已被說成逸出合乎香港情理,涉嫌與另有圖謀的外國勢力連氣連勢、滙合成一股來意不純的抗中力量。北京如果對港人「亂針繡萬象」的情況不加理解,把視角偏狹的成見進一步加深,甚或轉化為敵視,香港必將淪為有理說不清的地方,人們尤其是年輕人一輩從困頓中反彈,那將難以想像和駕馭,而慣於一黨操控的北京,對民主選舉須有前期協商並有把握後期結果的思路,全不了解亦不接受;「佔中」行動因為要求公民提名而可能流血,已不是不能想像的荒謬……。想不到一九八九年北京定性「廣場示威」為「動亂」還未知究竟,四分一世紀後的香港政改,又因取態分歧而面臨前所未見的社會危機!(節錄)

(信報圖片)

#白皮書 #香港 #信報 #信報財經新聞

Tuesday, June 23, 2015

Five reasons we should celebrate Albert Einstein - Guardian

June 17, 2015 at 11:32pm
http://www.theguardian.com/books/2015/jun/12/five-reasons-we-should-celebrate-albert-einstein?CMP=share_btn_fb

1. His science
Einstein was, first and foremost, a scientist. In 1905 and again in 1916, he radically revised our understanding of the universe. He was a pictorial thinker who came up with a new, intuitive sense of what reality looked like. Physics at the start of the 20th century was a rather settled endeavour, not seemingly in need of radical revision. We thought light was a wave and that duration, length and mass were objective facts of the world. We thought that space was a flat, Euclidean entity, unaffected by the distribution of matter and energy within it. Einstein, a mere patent clerk when he first began suggesting differently, showed us that light must be thought of as a particle when it is emitted or absorbed, that matter is composed of atoms, that space is malleable, undulating with the distribution of the stuff within it, that how long or massive an object is or the time order of closely occurring events is not a fact of the world, but merely a fact of our point of view. He showed that these perspectival truths were well-behaved when they were placed in a four-dimensional conceptual framework. Seeing may be believing, but what we should believe about the universe, Einstein demonstrated, requires seeing it from a reference frame beyond that of the human senses.


Einstein's election riddle: are you in the two per cent that can solve it?
Read more
2. His politics
Einstein joked to his dear friend Max Born that he had a version of the Midas touch: everything he said turned to newsprint. Einstein’s science made him a worldwide celebrity, a status others might have enjoyed, but which Einstein despised. He was no shrinking violet, yet he detested the shallowness and meaningless absurdity that came with his universal adoration. But he realised that it could be handy. He was given a cultural megaphone and he decided that its best use was to amplify the concerns of those whose voices were least heard. Whether it was his own Jewish brethren suffering the insults of antisemitism, African-Americans suffering systematic racism, the poor kept down by structural barriers to advancement, or political dissidents in the Soviet Union who were being repressed, Einstein was unabashedly vocal in trying to change the institutions that led to inequality and injustice. His standing provided him with a unique place to speak for those who were silenced and he made great use of it in the name of universal human dignity.

3. His immodesty
Einstein never lacked confidence. Strengthened by his convictions, he was impervious to the power of those with superior social or professional standing, and resolute in his willingness to state his beliefs publicly. As social psychologists have shown since the famous experiments of Solomon Asch and Stanley Milgram, humans are greatly influenced by the opinions of those around us, especially those who occupy positions of authority. We can shy away from reasonable and ethical beliefs, if we sense that we are in the minority for holding those views. But Einstein stands as an example of intellectual commitment. His revolutionary physical theories and his advocacy for peace at times of war and for better treatment of those in need were often unpopular. Einstein was investigated by the FBI for his views, and he received death threats from Nazi sympathisers. He was threatened with the loss of his position at the Institute for Advanced Study for his vocal support for his beliefs and causes. Yet he steadfastly refused to give in to fashion, expedience or groupthink. It is a cliche to say someone has the “courage of his convictions”, but Einstein is a figure of great courage in publicly expounding views he thought correct and morally necessary when such positions were dangerously unpopular.

4. His modesty
Einstein was flummoxed by his public reception. In one famous incident, he was accompanying Charlie Chaplin to the opening of his film City Lights when they were mobbed by thousands of fans. “What does it mean?” Einstein asked Chaplin, who replied: “Nothing.” We have a cognitive bias that leads us to be more apt to believe the praise we receive and to explain away criticism. We are the focus of our lives and with the contemporary cults of individuality and celebrity, too many people eagerly welcome the spotlight and take it as a sign of their superiority. But Einstein did not seek mass adoration or personal aggrandisement. He was not present to receive his Nobel prize. He refused the presidency of Israel. He was willing to step into the public eye when it suited his causes, but he was not one to seek fame for the sake of fame.

5. His meaning as a cultural symbol of modernity
I often ask audiences: “When I say the name Albert Einstein, what is the first thing that comes to mind?” Regardless of the demographic or the country in which I ask this, inevitably the response is “the hair”. Here is a man who changed the way the way we see reality, who stared down hatred and stood up for justice, yet despite all of this, the thing we immediately think of is that mane of unkempt, wild white hair. That may seem shallow of us, but I think it is a good thing. What does Einstein’s hair signify? It was a political statement – he refused to conform to social standards of personal appearance. He was unapologetic in his individuality and unashamed of being different. Growing up a Jew in Wilhelmine Germany, where he was sent to a Catholic school, he was always aware of being an outsider and became not only comfortable with his distance from the mainstream, but took it as a mark of pride. On the one hand, Einstein is the very icon of the genius, someone whose innate intelligence made him radically unlike the masses. But in allowing his hair to become the spectacle it was, he became a symbol that said that special people can come from anywhere, can look like anyone. His physics appeared at a time when the regular order was being challenged by modernist movements in mathematics, science, art, religion, governmental and economic structures, even the very sense of what it was to be a human was being reconsidered from its core. Einstein, with his wild hair, signalled that human advancement comes not from the conformity the authorities demand, but from difference – and that all of us at various times in our lives feel a sense of alienation. Einstein gives us pride in ourselves as individuals who can make a difference; we can revel in free thought, but there is no need in doing so to reject our shared humanity.

Monday, June 22, 2015

10 Behaviors of High Achievers -TIME

http://time.com/3929123/high-achiever-behaviors/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+timeblogs%2Fcurious_capitalist+%28TIME%3A+Business%29

Steve Tobak / Entrepreneur 8:00 AM ET  

Stop obsessing over 'why'


I remember the conversation like it was yesterday. After lobbying to absorb yet another project into my ever-growing engineering group, something was bugging me. “It’s like I can’t get enough,” I confided in my manager. “It sort of scares me.” Finally, I asked, “Am I power hungry?”

“No, Steve, I don’t think you’re power hungry,” my boss replied. “You’re just achievement oriented.”

Relieved, I thanked him for his time and went back to work. It was only later that I realized I had no idea what he was talking about. What the heck does “achievement oriented” even mean, I wondered.

If it sounds like I was a bit naïve, I’ll cop to that charge. Unlike today’s up-and-comers, we didn’t really spend a whole lot of time thinking about ourselves back in the dark ages. But that never stopped some of us from reaching for the stars, even if we had little understanding of why we did it.

I believe that, among a number of other behavioral elements, explains why certain people are consistently high achievers.

They do without obsessing over why.

The common thread between every successful overachiever I’ve ever known – and I’ve probably known hundreds in the tech industry alone – is that they’re born doers, troubleshooters, and problem-solvers. If something important needs to be done, they’ll figure out how to do it, no questions asked.

They have no patience for the status quo.

Sunday, June 21, 2015

Beijing’s migrant children forced out of the city - Financial Times

June 17, 2015 at 11:29pm
http://www.ft.com/intl/cms/s/0/ffafd8fa-0a9a-11e5-a8e8-00144feabdc0.html#axzz3dE4mtANt

June 16, 2015 3:35 am
Beijing’s migrant children forced out of the city
Lucy Hornby in Beijing

Second-class citizens: children of migrant workers at nap time at an illegal migrant school in Beijing
Yang Yinli, like millions of migrant workers in China, sent her first son to live with his grandparents in the countryside. It was a choice she would bitterly regret.

No one was watching the lively six-year-old when he was struck and killed by a truck roaring through the steep village roads. Heartbroken, Ms Yang bore a second son and vowed to raise him in Beijing, stuffing a crib into her tiny shop and keeping a close eye as the toddler played on the pavements.
But new regulations announced this year may force her to send her son, now five, away to be educated. The regulations, which in effect prevent migrant children from entering the first year at Beijing schools, triggered weeks of protests this spring by crowds of anguished parents.
The battle faced by migrants for a basic education in Beijing and other major urban centres shows how China is struggling to accommodate the millions flowing to its cities despite a national policy of stimulating urbanisation. “His father could move with him but then what about me? I would still be far from the child,” Ms Yang says, her voice cracking.
About 40 per cent of the primary schoolchildren in Beijing lack a city hukou , the official household residency permit that grants access to social services, including education, healthcare and the right to buy homes. Nonetheless, in recent years they have been permitted to attend primary school in the city, a concession that has allowed many migrant couples to keep young children by their side. This school year alone, 470,800 non-Beijing hukou — or migrant — students attended primary and middle school in Beijing.
A relic of the famines during early Communist rule, the hukou system was introduced in the 1950s to keep the peasantry out of cities where food was more plentiful. It has gradually been relaxed as a flood of workers moved out of rural villages to the factories in cities along the prosperous coast but migrants still remain second-class citizens in many of the cities where they have settled.
Official statistics show that 55 per cent of Chinese, or 749m people, now live in cities, up from 19 per cent in 1980 at the dawn of market reforms, although the real number is probably higher — and still rising. A government think-tank has estimated it would cost about $100bn per year to integrate another 400m people into the cities over the coming decade.

The end of surplus labour has profound implications for the Chinese economy
Data blog: Three things we learnt on China migration
How the flow of labour from countryside to city in China has powered three decades of growth

China’s great migration
When China’s 170m rural migrant workers head home it is the biggest movement of people on earth
Reforms that allow migrants to establish residency in provincial cities have been accompanied by tighter restrictions for some, mostly hitting those who have moved to the biggest cities, or those who often change jobs and residences.
“If we were a market economy, the problem of population would sort itself out and resources would flow more evenly. But China is not a fully market economy and a lot of resources are still concentrated in the hands of certain cities,” says Hu Xingdou, an economist who studies migrant issues at the Beijing Institute of Technology. “Under these circumstances we can never have the free movement of people.”
Recent policies — such as the rules on education — seek to push migrants out of the most attractive and high-wage places into provincial cities where there is a glut of new housing. Those policies, a reversal of several decades of population flow into the biggest cities, force migrant parents once again to face the choice of confiding young children to the care of elderly and uneducated grandparents or to enrol them in distant boarding schools.
In May hundreds of migrant parents staged daily protests at education offices in Chaoyang district in Beijing. Videos of one protest show burly policemen dragging off weeping mothers while the crowd chants: “It’s not right!”
Anger is particularly strong because many migrant parents paid into Beijing’s social security system following tightened regulations issued last year, only to be stymied by additional requirements announced in late April. Those include rental documentation that migrants crowded into temporary housing cannot provide.

The Beijing Municipal Education Bureau referred questions on specific policies to the district. The district bureau said it was too busy preparing for college entrance exams to answer the FT’s faxed questions.
At pick-up time at one Chaoyang district pre-school, parents exchanged notes. “I think it is unfair,” said Ms Zheng from Fujian Province, the mother of seven-year old twins who were born in Beijing. “Why should migrant children be separated out?” She declined to give her full name for fear of damaging the boys’ chances of somehow entering school.
Audio
China's shrinking labour force
A shrinking labour force is driving huge economic change in China. James Kynge talks to Jamil Anderlini about the human cost of China's mass migration from rural areas to the cities and why it is now beginning to slow.
Launch in Pop-up

Ms Zheng had hoped regulations would evolve to allow her twins to someday attend high school in the city. Currently, children can only take the university entrance exam where their hukou is registered, exiling city kids to provincial towns hundreds of miles away just as they hit their teenage years. Grades plummet and it is common for children who were decent students in the cities to drop out once they are far from their parents. Sexual abuse and delinquency are growing concerns.
Some desperate teens have made national headlines. In May a 12-year-old girl who had attended at least two years of school in Beijing before being sent back to a desolate village in Sichuan province killed herself and poisoned her grandmother with pesticide.
“It has a great impact on the children but our nation doesn’t think about this much,” says Prof Hu. “We say if the nation is unwilling to build an extra school in the cities today someday it will end up building an extra jail.”

Saturday, June 20, 2015

EU calls crisis summit after failure of Greece bailout talks - Financial Times

June 19, 2015 at 1:07pm
http://www.ft.com/intl/cms/s/0/127a2cb4-1587-11e5-8e6a-00144feabdc0.html#axzz3dTQ0CQ5g

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/127a2cb4-1587-11e5-8e6a-00144feabdc0.html#ixzz3dTQdrvps

Last updated: June 19, 2015 12:19 am
EU calls crisis summit after failure of Greece bailout talks
Peter Spiegel in Luxembourg

Greek Finance Minister Yanis Varoufakis gives a press conference at the end of a eurozone finance ministers meeting at the European Union Council headquarters in Luxembourg on June 18, 201
Yanis Varoufakis
The eurozone’s leaders have been summoned to an emergency summit in Brussels in a last-ditch effort to prevent Greece from defaulting on its debts and potentially crashing out of the EU’s common currency after finance ministers failed to agree a deal to release desperately needed bailout aid.
Donald Tusk, the European Council president who convened the summit of eurozone heads of government, said the finance ministers’ failure on Thursday evening meant it was now time to “urgently discuss” the Greek crisis “at the highest political level”.

Alexis Tsipras, Greek prime minister, has long sought to negotiate a deal with his fellow leaders, and some eurozone officials said they remained hopeful that Mr Tsipras — who has privately told EU leaders he wants to reach a deal — will agree to creditors’ terms on Monday despite four months of resistance.
“The key emergency is to restore a dialogue with adults in the room,” said Christine Lagarde, the International Monetary Fund chief who attended the session.
Although Yanis Varoufakis, the Greek finance minister, presented a new proposal for a “deficit brake” to automatically cut spending across the board if the government’s budget went into the red, eurozone officials said the plan mimicked existing EU rules and was dismissed by those in the room.

Instead, fellow ministers vented their frustration at Mr Varoufakis for the stalemate. According to two officials present, Benoit Coeuré, the European Central Bank board member responsible for crisis issues, warned that the uncertainty over Greece’s future had become so severe he was unsure Greek banks would be able to open on Monday.
A senior Athens banker said that nearly €2bn in deposits had been withdrawn from Greek banks from Monday through Wednesday of this week. The Greek central bank late on Thursday night requested an unscheduled conference call of the ECB governing council on Friday to get approval for additional emergency loans to keep Greek banks afloat.
Mr Coeuré’s warning was first reported by Reuters. The ECB declined to comment.
But after a four-hour meeting of eurozone finance ministers in Luxembourg, Greece’s creditors expressed their exasperation in unusually sharp terms, saying the two sides were no closer to an agreement. They insisted that Athens must become more serious in presenting a credible reform plan to access the €7.2bn in aid remaining in the bailout programme.
Mr Varoufakis blamed fearmongering by the preceding government, unreasonable demands from creditors, and inappropriate warnings from the Greek central bank for causing the spike in withdrawals, which have sparked fears of a full-scale bank run. He rejected the idea of imposing capital controls to slow the deposit flight.


“A monetary union that has accepted capital controls is a monetary union that has accepted that it has failed in its duty to preserve the free flow of capital,” Mr Varoufakis said.

In depth: Greece debt crisis
Greece debt crisis
The Syriza government is facing resistance to its plans to tackle the country’s massive debt burden

According to people briefed on eurozone planning, Greece’s central bank could request that Mr Tsipras legislate for capital controls if no agreement is reached at the Monday night summit, called for 7pm.
Jeroen Dijsselbloem, the Dutch finance minister who chaired the ministerial gathering in Luxembourg, for the first time acknowledged that time had run out to disburse rescue funds to Athens before the bailout programme closes at the end of the month.
Instead, Mr Dijsselbloem said that any agreement would now need an extension of the programme into July — the third extension in six months — heightening the risk that Greece will default on a €1.5bn loan repayment due to the IMF in less than two weeks.
“It is unthinkable the implementation [of reforms by Greece] and then disbursement would also take place before the end of the month,” Mr Dijsselbloem said.
Greek debt crisis: Key dates on road to a possible Grexit
EU/IMF inspectors in Greece as eurozone exit fears grow...epa03316123 An illustration showing a Greek flag projected onto a Greek one euro coin in Schwerin, Schwerin,†Germany, 24 July 2012. International creditors will on 24 review Greece's troubled austerity programme at a time of renewed concern about the country's future in the eurozone. The new conservative-led coalition government is scrambling to come up with 2.5 billion euros (3 billion dollars) more in savings to meet the target of 11.5 billion euros set by the European Union and the International Monetary Fund (IMF) for 2013 and 2014. Among the measures recommended by the Center of Planning and Economic Research (KEPE) pension cuts worth an estimated total of 5.1 billion euros. EPA/JENS BUETTNER
The five-month stand-off between Athens and its bailout lenders may be entering its most critical phase.

If a deal is reached and an extension agreed, among the options being discussed by creditors is using €10.9bn in existing aid previously set aside to recapitalise Greek banks and redeploying it as normal bailout funds that Athens could use to pay its upcoming debts. Athens faces €6.7bn in bond repayments in July and August.
But Mr Dijsselbloem made clear that no extension would be granted unless a deal were struck on economic reforms. Athens has vociferously rejected the creditors’ compromise plan because of cuts demanded in public sector pensions and tax increases on electricity.
Mr Dijsselbloem rejected Mr Tsipras’ continued demands that any agreement include debt relief. Several officials believe the Greek premier will be unable to sign a deal without some kind of debt restructuring; eurozone officials said leaders were prepared to offer the promise of future writedowns, but not as part of the current deal.
“The logical order of things is that we reach agreement on the terms of the . . . fiscal measures, reforms, first before we look to the future,” Mr Dijsselbloem said of Greek proposal for debt restructuring. “This Greek proposal is part of their vision of the future.”

Friday, June 19, 2015

Divorce Greece in haste, repent at leisure - Financial Times

June 17, 2015 at 10:48pm
http://www.ft.com/intl/cms/s/0/a614c36c-141f-11e5-9bc5-00144feabdc0.html#axzz3dE0Zv6h4

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/a614c36c-141f-11e5-9bc5-00144feabdc0.html#ixzz3dK64jFZ8

June 16, 2015 5:56 pm
Divorce Greece in haste, repent at leisure
Martin WolfMartin Wolf

The outbreak of the first world war was, we are told, greeted with confidence and jubilation by the peoples of Europe. Something similar seems to be happening after years of economic crisis and political turmoil in Greece. A growing number of people feel that enough is now enough. The strident views expressed in these pages by the Italian economist, Francesco Giavazzi, are shared by many in high office. Meanwhile, Alexis Tsipras, the Greek prime minister, accuses Greece’s creditors of “pillaging” his country.

Olivier Blanchard, the International Monetary Fund’s sober chief economist, indicates that a deal might still be reached. But many are beginning to long to see the knot cut. Whatever game the Greeks thought they were playing, their government may now just desire an end to the humiliation. Similarly, whatever game the eurogroup may have been playing, it may now just want an end to the frustration. If so, Greek default, exit and devaluation could be fairly close.
Would euphoria then last? I fear not. The assumption of some in the eurozone is not only that the Greek case is unique, but that the disaster those sinners so deserve would improve the behaviour of everybody else. But the currency union would also no longer be irrevocable. New crises will occur. When they do, confidence in the union would be less than complete after a Greek exit. The programme of Outright Monetary Transactions, announced by the European Central Bank in 2012, might need to be implemented, to calm nerves. But it could fail. Self-fulfilling speculation could force even more divorces.
Some argue that Greece at least would be far better off after a default and exit. It is indeed theoretically possible that a default to its public creditors, combined with introduction of a new currency, a big devaluation (accompanied by sound monetary and fiscal policies), maintenance of an open economy, structural reforms and institutional improvements would mark a turn for the better. Far more likely is a period of chaos and, at worst, emergence of a failed state. A Greece that could manage exit well would have also avoided today’s plight.
Podcast


As Greece heads closer to a default, how are the markets reacting and what would happen if the Tsipras government failed to reach a deal with Greece’s creditors? Patrick Jenkins, FT financial editor, discusses the potential fallout with Ralph Atkins, Martin Arnold and Caroline Binham.
Neither side should underestimate the risks. It is also crucial to avoid the contempt so characteristic of the frayed nerves caused by failing negotiations.
Fecklessness may be a grievous fault, but grievously have the Greeks answered it. As the Irish economist, Karl Whelan, points out in a blistering response to Mr Giavazzi, the Greek economy has suffered a staggering collapse. From peak to trough, aggregate real gross domestic product fell by 27 per cent, while real spending in the economy fell by a third. The cyclically-adjusted fiscal balance improved by 20 per cent of GDP between 2009 and 2014 and the current account balance improved by 16 per cent of GDP between 2008 and 2014. The unemployment rate reached 28 per cent in 2013, while government employment fell by 30 per cent between 2009 and 2014. Such a brutal adjustment would have shredded the politics of any country. (See charts.)
Martin Wolf 1
Europeans are now dealing with Syriza because of this calamity. But they are also dealing with Syriza because of the refusal to write down more of the debt in 2010. This was a huge error, made far worse by the subsequent collapse of the Greek economy. Indeed, the vast bulk of the official loans to Greece were not made for its benefit at all, but for that of its feckless private creditors. Creditors, too, have a duty to take care. If they are careless, they risk big losses. If governments want to save them, their own taxpayers should be told to pay up.
Greece has also already made significant reforms, including to its pension arrangements and business environment. But backtracking on such reforms would indeed be a huge mistake, as the eurogroup and IMF argue.
Martin Wolf 2
Given all this, it is tragic that the breakdown might occur now, after so much pain has already been suffered. It is not too late to reach agreements aimed at promoting reform, minimising additional austerity and making debt manageable. That would also be in everybody’s long-term interest. The parameters of such a deal are also clear: a small primary surplus in the short run, a decision by the eurozone to pay off the IMF and the ECB, accompanied by long-term debt relief, and a strong commitment to bold structural reforms by the Greek government.
Whether it likes it or not (understandably, it does not) the European Central Bank is a central player. It will have to decide when it can no longer treat the credit of the Greek government as collateral against emergency liquidity assistance to Greek banks. If Greece cannot reach a deal on the release of funds, the ECB seems likely to cut the banks off. That would then trigger controls on withdrawals. This might be accompanied by a scheme for circulation of deposit receipts, or ultimately by messy introduction of a new currency.
Martin Wolf 3
Right now, however, the aim must still be to cool down and secure a deal. Yet, in the current mood of anger and recrimination, reaching one now seems ever more unlikely. That would not be the end of the story, however. Europeans will be unable to walk away. Whether Greece stays inside the euro or leaves, much the same challenges will arise. The Europeans would still have to admit that they would not get much of their money back; and they would still have to help avoid a Greek collapse.
It might be a relief to divorce a difficult partner. But the partner will still exist, even after this monetary marriage is over. Greece will remain strategically located and even inside the EU. Neither the Greeks nor their partners should imagine a clean break. The relationship will continue. It will just be poisonous. If, tragically, that fate cannot be avoided, it will have to be managed for a very long time.
martin.wolf@ft.com

Thursday, June 18, 2015

Four games the Greeks may be playing - Financial Times

June 16, 2015 at 10:07pm
http://www.ft.com/intl/cms/s/0/98eb8b70-1335-11e5-bd3c-00144feabdc0.html?siteedition=uk#axzz3dE4mtANt

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/98eb8b70-1335-11e5-bd3c-00144feabdc0.html#ixzz3dE5DJzD8

June 15, 2015 4:12 pm
Four games the Greeks may be playing
Gideon RachmanGideon Rachman

When the radical left won power in Greece in January much was made of the fact that Yanis Varoufakis, the new finance minister, is an academic economist. Many expected that Greece’s negotiating strategy would display a new subtlety and brilliance, now that it was guided by the co-author of Game Theory — A Critical Introduction .
Yet, a few months on, Greece is running out of friends and money. As a debt default looms, even some sympathetic commentators are baffled by the Athens government’s actions.

So what game are the Greeks playing? Here are four possible hypotheses:
Game 1: they are bluffing and they still think they can win. The Tsipras government may still believe that the EU will not ultimately tolerate the break-up of its most important project — the European single currency. The loss of political prestige would be too enormous; the risks of financial contagion too great. But the EU will not make serious concessions until the moment that it really believes that Greece is about to crash out of the euro. So some evidence of chaos and panic in Athens may actually be necessary to convince the EU that the end game is approaching.
Game 2: they are bluffing and they are only now realising that they have miscalculated. Alexis Tsipras and his Syriza party are newcomers to the high politics of the EU. They won election in January believing that they could win the argument against “austerity” and find like-minded friends across Europe. The past few months have been a painful education in the realities of European politics. Mr Varoufakis’s theories have not worked out in practice, leading him to lament the absence of “a skilled game theorist on their side”. But Syriza’s belated realisation that it must largely accept the terms of its creditors — or quit the euro — has come perilously late.
Game 3: this is all about retaining power at home. The erratic negotiating style of the Greek government betrays the chaos in Athens. In part, this is a reflection of the inexperience and lack of resources of the Syriza team. But the party may also be trapped by the internal politics of Greece. Syriza is a coalition and the hard left of the party is likely to split off if Mr Tsipras is seen to accept austerity in return for a new agreement with Greece’s creditors. The broader electorate may also be none too impressed. Cutting a deal might therefore mark the end of Mr Tsipras’s political career.
Game 4: Greece actually wants to leave the euro. Among the academics and politicians who have advised Syriza there are undoubtedly some who have always believed that Greece ultimately has to leave the euro. They think that their country can only escape its downward economic spiral if it repudiates some or all of its debt — and they know that the price of that is likely to be ejection from the euro. What is more, once Greece is out of the euro, a new, floating currency might help restore the country’s competitiveness. Some in Syriza also believe that the euro and the EU in general are inseparable from the “neoliberal” economics that they reject.
In depth

Greece debt crisis
Greece debt crisis
The Syriza government is facing resistance to its plans to tackle the country’s massive debt burden
Read more
The difficulty is that Syriza came to power against the background of opinion polls showing that a large majority of Greeks want to stay inside the euro. So it is crucial for the Greek government to construct a narrative in which Syriza is seen to make a genuine effort to stay inside the single currency — only to be ejected by unreasonable foreigners, led by the Germans.
Which of these games is actually being played in Athens? I suspect that elements of all four are playing out. Even now, decision makers in Athens must be hovering between options one and two — convinced at one moment that the EU will ultimately cut a better deal, fearing at another that no such deal will emerge.
Some of Mr Tsipras’s apparently erratic behaviour — such as promising to make a payment to the IMF and then delaying it — also reflect his political difficulties at home. And while the group of Syriza thinkers who actually want Greece to leave the euro may be in a minority, their number will surely grow as the crisis intensifies.

More video
The uncertainty about what is driving Athens is only amplified because a parallel set of questions can be asked about the motivations of Brussels and Berlin. It could equally well be argued that the German government is bluffing, in the expectation of Greek capitulation; or that the team around Chancellor Angela Merkel has miscalculated in expecting the Greeks to “behave reasonably”; or that the German government, like its Greek counterpart, is trapped by domestic politics; or, finally, that there are many in Germany, particularly in the finance ministry, who now actively want to force Greece out of the euro.
Uncertainty on one side of the negotiating table only increases the uncertainty on the other side. If both sides think that the other side’s calculations are shifting, then it is harder to make a reasoned assessment of what needs to be done to secure a deal.
Unfortunately, the “game” that is currently under way between Greece and its creditors looks less like a sophisticated exercise in a Cambridge seminar room than the scene in Rebel Without A Cause, in which two cars race towards a cliff — and each driver waits for the other’s nerve to crack first. In the movie, the scene ends with one of the drivers plunging over the edge.
gideon.rachman@ft.com

Wednesday, June 17, 2015

Thaw in US-Cuba relations heightens business expectations - Financial Times

June 17, 2015 at 12:04am
http://www.ft.com/intl/cms/s/2/15afe7cc-fb0e-11e4-9aed-00144feab7de.html?segid=0100320#axzz3dE4mtANt

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/2/15afe7cc-fb0e-11e4-9aed-00144feab7de.html#ixzz3dEYmGqGd

June 15, 2015 11:09 pm
Thaw in US-Cuba relations heightens business expectations
John Paul Rathbone

There is a new entry among Cuba’s roll of important dates. Alongside Fidel Castro’s 26th of July movement and the January 1 1959 “triumph of the revolution”, there is now December 17 2014.
That was the day when Barack Obama and Raúl Castro, the US and Cuban presidents, announced that they wanted to normalise bilateral relations and end more than 50 years of cold war enmity.

To be sure, communist Cuba was already changing. After formally becoming president in 2008, Mr Castro began a tentative economic liberalisation process to boost the country’s flagging economy — especially urgent now that Venezuela’s growing crisis jeopardises the $1.5bn of aid it sends every year.
But the December 17 announcement lit a bonfire of expectations among US businesses — even if Cuba’s $80bn economy, for all its exotic allure, is much the same size as the Dominican Republic’s.
“There is a new sense of excitement, of US companies coming to look and thinking of starting seed businesses,” says one long-established European investor in Havana. “It makes sense. Start small, learn how the system works and then see how it all goes.”
So, how might it all go? US and Cuban officials have warned that expectations are too high. “Prospects [in Washington] for lifting the embargo in the short term are dim,” cautions Michael Shifter of the Inter-American Dialogue think-tank.
The notion that US businesses and tourists might soon turn Cuba into a Disney-style communist theme park with McDonald’s outlets spread along Havana’s seafront is also unlikely; Havana has run its own government for 56 years and is proud of its sovereignty.
Furthermore, even if the US embargo were to end overnight, the island still faces an “internal embargo” — the thicket of Soviet-style bureaucracy and centralising socialist attitudes that makes doing business difficult.
“All of Raúl’s economic reforms involved decentralisation, which is good, as Cuba needs that,” says Rafael Hernández, editor of Temas, a state-published cultural magazine. “The problem is this . . . has not happened.”
(top to bottom) Raúl Castro meets President Obama, Pope Francis and President Putin©Reuters; Getty
Diplomatic flurry: (top to bottom) Raúl Castro meets President Obama, Pope Francis and President Putin
Still, change is coming to Cuba, however slowly, and one way to mark the changes is to travel back to Pope John Paul II’s 1998 visit. “Do not be afraid,” he said. “May Cuba, with all its magnificent potential, open itself to the world, and may the world open itself to Cuba.”
Today, Cubans appear less afraid. Activists are still hounded, but there is a willingness among many to speak their minds, and some official tolerance too.
One sign of this is the continued existence of news website 14ymedio.com, set up by dissident journalist Yoani Sánchez — even if limited internet access means few of Cuba’s 11m people can read it.

The world has also begun to open up to Cuba. Before December 17, there were only 35 enquiries from foreign investors about Mariel — the $800m port and free trade zone on Cuba’s northern coast, built by Odebrecht, a Brazilian construction company, and operated by Singapore’s PSA. “After December 17, there is talk of 300 enquiries,” notes Emilio Morales of the Miami-based Havana Consulting Group — although how many of these enquiries turn into actual investment is another matter.
French President Francois Hollande (left) shakes hands with retired Cuban leader Fidel Castro during a private meeting in Havana, Cuba, May 11, 2015©Reuters
Fidel Castro with François Hollande in May
The embargo, whose removal requires settling tricky issues such as $7bn of US nationalisation claims, puts a brake on US businesses. It can also put a brake on third-country businesses, too.
“We have to be entirely self-financed,” comments one European resort operator. “The new US approach has been ‘that may be no longer illegal, but it is not necessarily legal either’ — which makes financing problematic.”
Lastly, Cuba is opening to the world, albeit slowly. The Communist party is torn between letting reforms rip and maintaining control. Little surprise that results are disappointing — as was tacitly recognised by Mr Castro, who wants to deepen reforms, increasing the chances of an economic “soft landing” in 2018, when he says he will retire as president.
“Dealing with the internal embargo is one of Cuba’s biggest challenges,” says Pedro Freyre of US law firm Akerman. “The state might want to let small businesses grow . . . but then it often taxes, regulates and clobbers them.” One sign of ambivalence is the emphasis on state-sanctioned co-operatives, rather than the 500,000 self-employed workers.

Cuba also suffers from limited bandwidth to deal with foreign interest. That is as true of Havana’s stretched tourist capacity as it is of Cuban officials with sufficient authority to make decisions. Mariel’s six approved projects, for example, required approval from the Council of Ministers, the highest authority.
Even so, there is strong business interest in Cuba’s so-called “knowledge economy”, especially biotechnology. A handful of large foreign corporates — such as Canadian miner Sherritt International, and France’s drinks maker Pernod Ricard and telecom’s group Bouygues — set up profitable businesses years ago. So too, more recently, have émigré mom-and-pop entrepreneurs from Miami.
Even if the US embargo ends, an ‘internal embargo’ remains — a thicket of Soviet-style bureaucracy
Tweet this quote
At Miami discount store Ñooo! Que Barato! (or “Wow! How cheap!”) Cuban-Americans can buy school uniforms for relatives’ children. The island’s recent flowering of private restaurants and hotels — mostly refurbished private homes — is also largely financed by Cuban-Americans, who remit up to $2bn annually to relatives.
The message from foreign businesses in Cuba is that the island is a potentially exciting market for anyone content to wait for uncertain and long-term returns. In the meantime, a word of caution about the surge of private foreign interest in Havana property, where purchases are possible only via a resident Cuban partner, who then has legal title.
“The outsider takes all the risk,” says one European businessman. “I’ve heard as many unhappy as happy stories.”