DON'T START shouting "Spanish bank run", at least not yet, in spite of the figures: yes, $82bn was sent abroad last month, but if you look at the data (summary in Spanish here) it turns out that 2 thirds of it,
Thursday, May 31, 2012
GOOD THING the New York Times' exposé on the secret 'kill list' is during the Obama presidency. Had it been during Bush's, only God know how deep we would be buried under reports and columns in the Spanish media on how Americans are like Nazis -- only worse.
WHAT MAKES COUNTRIES rich or poor? It's a longish piece but it's by Jared Diamond, so go read it.
Wednesday, May 30, 2012
"SIX REASONS Spain will leave the euro first". I think it's six reasons why Spain shouldn't have gone in the euro in the first place rather than why it should leave, though. Leaving once it's been in for years would be extremely complicated, to put it mildly.
TOTALLY AGREE: Life should be in reverse! "you start by dying, so you put the trauma behind you from the beginning. Then you wake up at a residence getting better by the day. Then they tell you to leave the residence because you're in too good shape to stay in it, and the first thing you do is start getting a pension. Then in your first day of work you get a gold wristwatch. You work 40 years until you're young enough to enjoy retirement. Then you go from one party to another, you drink and have sex all the time and then you start school, playing with your friends, no obligations, until you're a baby. You spend the last 9 months totally relaxed, floating, with central heating and room services. And at the end, you leave this world with an orgasm."
BREAKING NEWS: according to unimpeachable sources who wish to remain anonymous because they're not authorized to talk on the record on this issue, the Spanish government plans to change the country's national anthem immediately. Instead of the Royal March, starting June 1st the new anthem will be this:
GOOD THING it wasn't Bush, but Obama, who called the Nazi camps in Poland "Polish camps", or Twitter would be exploding with jokes on how dumb he is, and so forth.
Monday, May 28, 2012
IT'S NOT Spain, Greece, or the euro; it's Europe itself marching towards irrelevancy:
The opening last week in northeastern Spain of a 37-million-euro stretch of motorway to nowhere is an irresistible metaphor for the euro, an ambitious project conceived in better times that is now seemingly running out of road.Read the rest.
With Spain heavily in debt, the authorities could not afford to finish the highway but opened the completed 6 km section near Lleida in any case to deter illegal joy racing.
If only the euro were bringing joy. Maybe the road in Spain will be completed one day, but for now it is one more reminder that much of Europe has been living beyond its means.
On this score, the euro's woes are largely irrelevant. Europe would have to pull up its socks with or without the single currency. The really big challenges to Europe's standard of living come from globalisation, technological change and ageing populations.
Put differently, if Europe wants first-class infrastructure and a comprehensive welfare state without piling up ever more debt, governments need to shake up working habits to generate the growth that spins off tax revenues.
Yet Europe's response, with policymakers preoccupied by the festering currency crisis, has been tardy. All the while, the rest of the world, especially Asia, has been marching on.
Douglas Roberts, chief international economist at Standard Life Investments in Edinburgh, said it was no wonder that the United States exports more than twice as much to emerging markets as it does to sclerotic Europe.
"Even if Europe were firing on all cylinders, it would be one of the slowest growing regions in the world," he said.
THE HORROR of North Korea's labor camps doesn't abate.
Friday, May 25, 2012
THE word corralito does not need translating to Spaniards. They know it means the partial freezing of bank accounts that afflicted Argentina as money fled the country a decade ago. That is what makes it so frightening.
It should not happen in a solvent country like Spain. But as the spectre of a Greek euro exit is haunting Europe, Spanish banks have become a big concern. Ministers have had to deny the corralito risk.
Thursday, May 24, 2012
European officials are stepping up contingency planning for a possible Greek exit from the euro zone, even as Europe's leaders struggled to overcome differences on how to resolve the currency bloc's crisis at a summit meeting here.
Emerging from Wednesday night's informal European Union summit, Italian Prime Minister Mario Monti said most leaders had backed issuing common debt, or euro-zone bonds, to help support troubled members. But Germany and others opposed them and demanded Greece do more.
"We want Greece to remain in the euro zone," German Chancellor Angela Merkel told reporters after nearly eight hours of talks. "But the precondition is that Greece upholds the commitments it has made."
Wednesday, May 23, 2012
AGAIN, one needs to ask: Austerity? What austerity? Five simple charts completely bust the myth of European austerity: public spending has actually increased in the last few years.
33 PERFECTLY TIMED PHOTOS.
Tuesday, May 22, 2012
JENNI MURRAY is angry that everyone is saying that Robin Gibb 'lost his battle with cancer':
I'm at a loss to know why, despite a number of us who've been through the dread diagnosis and subsequent treatment pointing out that such pugilistic terminology is entirely inappropriate, we continue to be given the impression that death from cancer is somehow an indication of failure to have the moral fibre to fight and defeat it.She's completely right.
AWESOME NEWS: the 111-year archive of National Geographic magazine is back online. If you're busy don't click on the link...
FOUR REASONS why the Euro is not crashing. At least not yet.
THE ANATOMY of the Eurozone bank run.
Monday, May 21, 2012
A VERY GOOD explanation of the incestuous relationship between Spain's savings banks and politicians, and its role in the downturn. A must-read.
Friday, May 18, 2012
CORRECTION OF THE DAY (scroll down to the bottom).
CHINA, the place were big business is a ruling family affair.
Thursday, May 17, 2012
Wednesday, May 16, 2012
ARNOLD KLING: "[C]ontra the mainstream media narrative, the real dilemma in Europe is not fiscal--deciding whether to maintain government spending or not. The real dilemma is financial--whether to recognize losses and absorb defaults (by both governments and banks) or turn loose the monetary printing presses."
Tuesday, May 15, 2012
IS IT REALLY THAT BAD? Maybe not:
BBVA Research’s latest estimates confirmed the recession in Spain, pointing to a GDP contraction of 1.3% in 2012. However, economic indicators are revealing a less dramatic than estimated deterioration in the real economy. The data presented in its ‘Spain Economic Outlook’ report show that the measures adopted lend credibility to the ability to meet current fiscal deficit targets.Should you be interested, you can read the study here (pdf).
YOU THOUGHT golf balls were hard? They are, but look at what happens when it hits a steel plate at 150 mph, in this super slow motion video.
Monday, May 14, 2012
AS EUROPEAN AUSTERITY ENDS, so could the euro:
The euro currency is a malady that condemns at least a generation of Greeks, Italians, Spaniards, Portuguese and Irish to the economic infirmary.Keep reading.
In these nations, unemployment rates are now at their highest levels in recent decades, and there are few prospects for recovery in sight. The economists and politicians who created the system still proclaim it can survive. Their time would be better spent recognizing they made a bad mistake and preparing for an orderly dismantling of the euro before the damage spreads and further undermines European unity.
The problem isn’t just the region’s lack of competitiveness or its budget deficits or the high stock of existing government debt, which the International Monetary Fund now puts at 90 percent of the euro area’s gross domestic product (see Table 5 in this report). It is all of the above, compounded by five years of complete political denial.
For three years, capital has been fleeing Europe’s periphery for Germany. That country’s liquid banks, competitive labor markets and sound fiscal policies have made it the ideal location in Europe for investment. The periphery’s illiquid banks are sharply contracting credit to the productive sector, even as their governments are cutting back and political protests are mounting. Wages are too slow to adjust to dent these powerful forces: Germany looks ever more attractive for investors, further exacerbating the imbalances that brought us to this point.
Is there any hope for the euro dream?
SIMON NIXON in the Wall Street Journal:
Another missed opportunity. Four years into the crisis, Spain's failure to deal with the weaknesses in its banking system has become a threat to global financial stability. There is no great secret over what is required: Madrid only had to look to the experience of the U.S., U.K. and Ireland, among others, to see this crisis wouldn't end until Spanish banks were forced to write down toxic real-estate exposures to realistic levels and plug any capital shortfalls with equity. Yet for the second time in a little over two months, Madrid has produced a plan that looks short of the mark.
[...] Madrid's continued failure to do what is needed to regain market confidence is baffling. No doubt it fears having to ask its European partners for aid; perhaps it has also been swayed by pressure from Spain's largest banks, for which any state recapitalization might lead to the breakup of their empires under European Union state aid rules. But this piecemeal approach is deeply corrosive to Madrid's credibility. Madrid may struggle to hold this latest line for long: The new package is unlikely to be the last.
Friday, May 11, 2012
FRANCE ENTREPRENEURS flee from Hollande wealth rejection. Just what the country needed...
Thursday, May 10, 2012
100 IDEAS that changed graphic design forever. Awesome.
BLOOMBERG: Spain, the new Ireland, only worse.
Wednesday, May 09, 2012
NINE DANGEROUS THINGS you were taught at school.
ARTHUR BROOKS: "I learned to appreciate the American free enterprise system by quitting a job in Spain." Must read.
AUSTERITY, WHAT AUSTERITY? PART MDXVII: when you hear someone repeating the bulllsh*t that austerity is killing Europe's economy bla bla bla, please show him or her this (click to enlarge):
Friday, May 04, 2012
PLEASE tell me this is a joke. Please. Zapatero writing a book about economy? What's next, Mengele's treatise on medicine?
Thursday, May 03, 2012
EUROPEAN AUSTERITY my ass: "Europe to launch €1bn mission to Jupiter's moons"
I HOPE the poor guy gets a big compensation for damages:
The Drug Enforcement Administration extended an apology to a University of California engineering student who was locked in a holding cell for more than four days and forgotten about. The student drank his own urine in desperation and attempted to kill himself, before agents returned four days later and found him, he said in a news conference covered by NBC and other outlets.
CALL YOURSELF a Nazi and you'll be despised (and rightly so). But call yourself a Maoist and quite a lot of people will think you're cool, or at least that you profess a legitimate ideology. No matter your guiding light is someome who was responsible for the death of 45 million people:
Mao Zedong, founder of the People's Republic of China, qualifies as the greatest mass murderer in world history, an expert who had unprecedented access to official Communist Party archives said yesterday.
Speaking at The Independent Woodstock Literary Festival, Frank Dikötter, a Hong Kong-based historian, said he found that during the time that Mao was enforcing the Great Leap Forward in 1958, in an effort to catch up with the economy of the Western world, he was responsible for overseeing "one of the worst catastrophes the world has ever known".
Mr Dikötter, who has been studying Chinese rural history from 1958 to 1962, when the nation was facing a famine, compared the systematic torture, brutality, starvation and killing of Chinese peasants to the Second World War in its magnitude. At least 45 million people were worked, starved or beaten to death in China over these four years.
Wednesday, May 02, 2012
"GRAND PLAN to save Europe is unraveling". But, contrary to what the article says at the beginning, it's not because of austerity, precisely. You can't really say with a straight face that humongous deficits, like those run by European countries, is austerity. It's rather the lack of real austerity what's killing the Eurozone. Governments run into deficits just to be able to pay back debt with interest; it's basically kite credit. And to make things worse, something that detracts credit from the private sector.
A GERMAN COURT has banned Windows 7 and the Xbox 360 from the country. I hope Microsoft has a good crisis manager...