Category Archives: Europe

Turkey – What is Going on?!?

stompingOver the top police violence, or what? Why would this be happening in (supposedly) the model nation for the region?

 

Brief summary here (English translation from Germany’s Der Spiegel).

Context: Stratfor’s analysis here.

Opinion piece about Erdoğan (the Turkish prime minister) here (from an American journalist living in Istanbul).

Outstanding, deep economic background here (Asia Times). Well worth the time to read.

Excellent continuing series of news dispatches here (London’s Telegraph newspaper).

Turkey-uprising2

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Filed under Developing Nations, Economy, Europe, Political Risk

The Economist Points Out the Euro Crisis, but Misdiagnoses and Cannot Understand Why

Europe bleeds out

“59.1% of those under 25 are unemployed in Greece, 55.9% in Spain, 38.4% in Italy, 38.3% in Portugal, 26.5% in France—3.6m youths in all…” OK, but because of interest rates?

atwotoobigtofail

Why? Progressive, “state-controlled economies really are… crony capitalist systems which pick winners and losers. They maintain the status quo at all costs — and reward those who have captured government over those who innovate.” – Richard Fernandez

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Filed under Economy, Europe

Margaret Thatcher, RIP

Margaret Thatcher history
Margaret Thatcher quotes (my favorite: “Of course it’s the same old story. Truth usually is the same old story.”)

Margaret Thatcher WSJ article

Margaret_Thatcher_01

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Filed under Europe, History

Young Europeans Turning Their Backs on the European Union

This article accurately reflects what I’ve been hearing from my younger cousins and nieces/nephews in Europe…

“…the alienation and desperation of an entire generation of young people… The EU has plans for a $6 billion initiative to help young people find jobs. But compare that to the $700 billion spent so far on rescuing Europe’s banks. It’s hardly a surprise that Europe’s disaffected youth believe their leaders care more about bankers than they do about them.”

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Filed under Economy, Europe, Finance

LIBOR is Not a Hungarian Actress

I’ve spent a lot of time talking with people about LIBOR over the years; even well-educated Americans are fairly clueless about what it is – and no, she is not a Hungarian actress.

 

 

 

 

 

 

 

 

 

Here is a nice infographic about what LIBOR is, with a very brief explanation at the bottom about the current scandal (and, at the top, a link to a rather poor Washington Post article about the same – the main item of interest is that now the British government is saying Tim Geithner is lying). LIBOR is used in a LOT of financial vehicles: mortgages, derivatives, alternative risk transfer arrangements, etc. Below is a selection of some articles that make efforts to explain the current scandal, and why they may be important:

1. From the UK’s Economist – “The rotten heart of finance” (which, towards the bottom, touches on something focused on in #5 below)

2. From the Wall St. Journal – “Rate Scandal Set to Spread” (now behind pay wall) – which contains the (probably inaccurate) factoid that more than $800 trillion in securities and loans may be linked to LIBOR, and “U.S. Regulators, Taken to Task on Libor, Vow Vigilance” – which shows the current political nature of this affair.

3. From Professor Mead (from the American Interest) – “The LIBOR Scandal: A Crisis of Faith” – which is really more about the lack of faith people have in the current global leadership. Which brings us to one of the dimmest bulbs in that particular pack…

4. An accusation of the US Treasury Secretary in the NY Post – “What did Tim know?” I know people who have worked with Tim Geithner. And, yes, he really does have poor math skills. But I am not sure if this particular scandal is the problem that will get him in trouble, which brings us to…

5. Asia Times‘ Spengler – “Dr Frankenstein’s LIBORatory” – refreshingly brings his knowledge of banking, history of the 2007-2009 financial crisis and how the monkeying around with LIBOR at the time, “this tissue of lies, collective referred to as ‘regulatory forbearance,’ allowed the banks to get their balance sheets under control within a year, repay emergency loans to the US Treasury with a profit, and get back to the business of lending.”

This is a big deal, but is still off most peoples’ radar. Read or review all the above and come to your own conclusions…

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Filed under Economy, Europe, Finance

Skin-Damaged, French Vegetarian, Tea-Totaller, No-Tax-Paying IMF Head Begins to Worry…

Her parents were apparently terrible tax planers (she was born 1 January 1956 – like one of my many beaux-frères [brothers-in-law]), so as an accounting professor have always had a hard time taking Christine Lagarde (recently appointed head of the International Monetary Fund) seriously, but she has come around to understanding that “a deterioration in the global economy, saying the outlook has become more worrying as developed and big emerging nations show signs of slowing down“.

In Tokyo today, she said that, “The IMF’s forecasts are likely to be lower than our previous forecasts.”

A bit late, but welcome to the party, Mme. Lagarde.

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Filed under Developing Nations, Europe, Finance

European Debt Crisis, Episode 253 – First Spain, Now Italy…

Concern for the moment shifts from Spain to Italy: “The Battle of Italy is truly under way; the Battle of Europe comes next.” But this may just be temporary, because some are already saying the Spanish deal, this latest euro fix, will come apart in less than a month.

Meanwhile, “EU Floats Worst-Case Plans for Greek Euro“.

Finally, this analysis touches on the core issues of national budgets, debt, “the decision about who will and will not be allowed to borrow”, sovereignty and the future of the European Union.

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Filed under Economy, Europe, Finance, Political Risk