Saturday, October 26, 2013

Bank Rule before Home Rule

From Bank of England governor Mark Carney speech marking the 125th anniversary of the Financial Times -- The preoccupations of 1888 were not very different than today. Editions of the FT 125 years ago contained stories on economic development in China, the health of Spanish government finances, and the state of Irish banks.

Friday, October 25, 2013

What would they do without America to complain about?

European Union policy on Syria -- get outraged only when US might bomb Syria.

European Union policy on migration -- get outraged about alleged US snooping. As a Wall Street Journal news story notes:

It was just two weeks ago that European leaders expressed shock at the tragedy just miles off the Italian island of Lampedusa, where hundreds of African migrants died in a shipwreck. The loss of life in European waters drove home the sheer desperation that brings migrants from North Africa to Europe on precarious, life-threatening boat journeys. But it also exposed the problems faced by countries on the borders of the European Union. The migration issue was set to be discussed by EU leaders on Friday in Brussels on the second day of a two-day summit. But for the four countries that are the main gateways for migrants to Europe—Greece, Italy, Malta and Cyprus—the extent to which the issue was overshadowed by new allegations of U.S. spying on its European allies was likely jarring. EU leaders arriving at the summit Thursday mostly spent time criticizing the U.S. for its alleged spying, rather than commenting on the need to prevent such tragic losses of life in the Mediterranean. It's "surreal," said Maltese Prime Minister Joseph Muscat.

Thursday, October 24, 2013

The Furious and the Fast

Part of statement from the Saudi Arabian Ministry of Interior concerning the proposed women day of driving in the Kingdom --

The laws of the Kingdom prohibit activities disturbing the public peace and opening venues to sedition which only serve the senseless, the ill-intentioned, intruders, and opportunity hunters, the statement said.

Wednesday, October 23, 2013

It's not the humidity, it's the heat

Why Google News (as of Tuesday evening) might need an actual editor.

Saturday, October 19, 2013

Free trade and billable hours

European Commission President Jose Manuel Barroso during a speech in June selling the potential of an EU-US free trade agreement (the so-called Transatlantic Trade and Investment Partnership) --

I believe that the EU-US trade negotiations are a game changer and can be the start of a new era. They will further intensify the economic relationship between the United States and European Union, two economic giants eager to be as successful in the future as they were in the past. They will add to the international push for trade liberalization, hammering out a new framework for open, transparent and balanced trade that fits the realities of the global economy. But most of all, they will reaffirm the global role and responsibility of both partners, which goes much beyond economics. Together, we share a world view based on democracy, human rights and the rule of law. We share an engagement and the ambition to cooperate across borders, to think and act multilaterally, to look for global solutions to global problems.

A fascinating New York Times article on how the Washington DC K Street lobbying culture is replicating itself in the agreeable environs of elite Brussels --

On a brisk night in September, with American lawyers as hosts, the library’s reading room was packed with dozens of executives from corporations including Boeing, Intel and Samsung, along with senior staff members of the European Commission. The guest of honor was James A. Baker III, the former secretary of state and Treasury and chief of staff to two presidents. He was looking so fit, at 83, that a lawyer asked him for nutrition tips. Mr. Baker had come to celebrate the first anniversary of the Brussels office of Baker Botts, the Houston-based law firm co-founded by his great-grandfather. As attendees nibbled on foie gras lollipops, dipped in a chocolate fondant, they discussed the potential business bonanza from trans-Atlantic trade negotiations that recently began between Europe and the United States. The goal of the negotiations is to “harmonize” the regulatory systems of the United States and Europe, so that companies can meet a single standard — worth hundreds of millions of dollars, if not billions, in savings for businesses, particularly if they can persuade negotiators to accept less strict rules in the process. The deal making could also mean a huge wave of lucrative lobbying and legal work in Brussels and in Washington for firms, which charge up to $1,000 an hour. “It ain’t going to be easy — it’s going to be tough,” Mr. Baker told the assembled crowd. “But it’s really important to get it done.”

The pensioners made the banksters borrow from the foreigners

Alan Greenspan, sounding like a parody of a Washington DC centrist,  in a Wall Street Journal profile--

Mr. Greenspan's biggest revelation came one day about a year ago when he was playing with gross domestic savings numbers. What he found, to his surprise and initial skepticism, was that an increase in entitlements has closely corresponded to a decline in the country's savings. "We had this extraordinary increase in benefits, with each party trying to outbid the other," he says. "That practice has been eroding the country's flow of savings that's so critical in financing our capital investment." The decline in savings has been partly offset by borrowing from abroad, which brings us to our current foreign debt: "$5 trillion and counting," he says.

Friday, October 18, 2013

Secretive Squid

Goldman Sachs released its 3rd quarter results yesterday. The press release is a classic of elevator accounting -- lots of numbers going up and down, but not a shred of analysis as to why. A New York Times article on the same issue concludes --

The lack of detail about the trading decline disappointed some analysts. “More disclosure would be better,” said Michael Mayo, a bank analyst at CLSA. “This is one reason that there is concern about large financial firms,” he said. “There is a lack of transparency in the areas that matter the most.”

The US government is providing large amounts of explicit and implicit insurance to a very large investment bank that can't or won't explain to people shifts of billions of dollars in its revenues.

The financial crisis changed nothing.

Talking points dead on arrival

Yesterday Saudi Arabia got a temporary seat on the UN Security Council. Human rights organizations went into ritual condemnation mode, as if there was something especially bad about Saudi Arabia being on the Council -- as opposed to Pakistan, the country it replaced, or Russia, which is on the Council all the time. Today, Saudi Arabia told the UN to take its security council and stick it. The full statement is worth reading:

First of all, the Kingdom of Saudi Arabia is pleased to extend its sincere thanks and deep gratitude to all countries that have given their confidence to elect it as a non-permanent member of the United Nations Security Council for the next two years. The Kingdom of Saudi Arabia, a founding member of the United Nations, is proud of its full and permanent commitment to the purposes and principles of the Charter of the United Nations, believing that commitment of all Member States, honestly, truthfully and accurately, as agreed upon and stipulated in the Charter is the real guarantee for world security and peace. 

If the Member States of the United Nations consider wining the membership of UN Security Council, which is, according to the Charter of the Organization, the sole agency responsible for preserving world peace and security, as a high honor and a great responsibility for participating directly and effectively in the service of international issues, the Kingdom of Saudi Arabia believes that the manner, the mechanisms of action and double standards existing in the Security Council prevent it from performing its duties and assuming its responsibilities towards preserving international peace and security as required, leading to the continued disruption of peace and security, the expansion of the injustices against the peoples, the violation of rights and the spread of conflicts and wars around the world. In this regard, it is unfortunate that all international efforts that have been exerted in recent years, and in which Saudi Arabia participated very effectively, did not result in reaching reforms required to be made to enable the Security Council to regain its desired role in the serve of the issues of peace and security in the world. 

With the current continuation of the Palestinian cause without a just and lasting solution for 65 years, which resulted in several wars threatened international peace and security is irrefutable evidence and proof of the Security Council's inability to carry out its duties and assume its responsibilities. The failure of the Security Council to make the Middle East a free zone of all weapons of mass destruction, whether because of its inability to subdue the nuclear programs of all countries in the region, without exception, to the international control and inspection or to prevent any country in the region from possessing nuclear weapons, is another irrefutable evidence and proof of its inability to carry out its duties and hold its responsibilities. 

Allowing the ruling regime in Syria to kill and burn its people by the chemical weapons, while the world stands idly, without applying deterrent sanctions against Damascus regime, is also irrefutable evidence and proof of the inability of the Security Council to carry out its duties and responsibilities. Accordingly, the Kingdom of Saudi Arabia, based on its historical responsibilities towards its people, Arab and Islamic nations as well as towards the peoples aspiring for peace and stability all over the world, announces its apology for not accepting membership of the Security Council until the Council is reformed and enabled, effectively and practically, to carry out its duties and responsibilities in maintaining international peace and security.

Which parts of that statement do Human Rights Watch and UN Watch -- which condemned Saudi Arabia's membership -- disagree with?

[Links to statement Part 1, 2, 3]

Wednesday, October 16, 2013

Brief Irish budget commentary

In the 7th year of austerity and in a policy framework that invites tinkering as opposed to wholesale change, there will be many small budget changes that are hard to keep track of, but one of the strangest -- relative to the amount of commentary it is attracted -- is the abolition of the air travel tax. At the same time that the government is going after various fees and charges for government services, to be cutting what was a fairly small tax on people who can afford to fly seems like a move in the wrong direction. Part of the motivation seems to be to attract more business for Dublin Airport as a regional hub -- in particular by encouraging people across the Irish Sea to travel transatlantic through Dublin on split tickets to avoid the UK travel duty on transatlantic flights. Another is surely to remove what swing voters regard as a nuisance tax, despite the associated loss of revenue. On the positive side, the stateless company wheeze is being abolished.

Monday, October 14, 2013

Missing Link

Saudi Press Agency --

New York , Dhu-AlHijjah 9, 1434, Oct 14, 2013, SPA -- Undersecretary General of the United Nations for Political Affairs Jeffrey Feltman categorically denied statements attributed to him the day before yesterday by a Lebanese newspaper. A statement that has just been issued by the spokesman of the Department of Political Affairs of the United Nations Jared Kotler, and a copy of which was obtained by the Saudi Press Agency, said, 'The Undersecretary General of the United Nations fully rejects the alleged statements attributed to him by the Lebanese newspaper issued on October 12.' The spokesman added, 'The statements attributed by the newspaper to the Undersecretary General of the United Nations were fabricated, were not made by him and neither reflect his point of view nor that of the international organization.' Undersecretary General of United Nations categorically denies statements attributed to him on the Kingdom.

The item doesn't name the paper, describe what was said, let alone give a link.

It takes a bit of work, but here's the link, to Al-Akhbar. You'll likely need Google Translate. Tensions over Syria, Iran, and Lebanon itself are the issues.

Thursday, October 10, 2013

East Bermuda

Financial Times --

The new figures come from the accounts of Google Netherlands Holdings, which represents the “Dutch sandwich” part of the tax structure. It received €8.6bn in royalties from Google Ireland Ltd and €232.8m in royalties from Google’s Singapore operation. All but €10.4m of this was paid out to Google Ireland Holdings, a company that is incorporated in Ireland but controlled in Bermuda. Differences between the Irish and US tax codes mean that this dual-resident company is viewed as Irish for US tax purposes but Bermudan for Irish purposes. It acquired much of Google’s intellectual property in 2003, which it licensed to Google Ireland Ltd, a Dublin-based business that is at the heart of its global operation. The business, which employed 2,199 people last year, paid €17m in Irish corporation tax, having reported pre-tax profits of €153.9 on turnover of €15.5bn.

He flew the shahada over the Savoy Hotel

Bloomberg News --

The Savoy, the five-star London hotel once frequented by Winston Churchill, Marilyn Monroe and Claude Monet, would be at risk of breaching terms of bank loans if operating results don’t improve, according to the company. “This risk represents a material uncertainty which could cast significant doubt as to the group’s ability to continue as a going concern,” according to an Oct. 7 filing to Companies House by Breezeroad Ltd., the hotel’s owner. Breezeroad’s directors prepared projections that assume an improvement in business and indicate the Savoy will continue to meet its debts, according to the filing. If the financial projections aren’t met, loans to the company, controlled by Saudi billionaire Prince Alwaleed Bin Talal and a Lloyds Banking Group Plc (LLOY) unit, could become repayable on demand.

The Savoy hotel is an important symbolic player in the Celtic Tiger bust. As recounted by Fintan O'Toole in Ship of Fools, referring to 2004 --

When a syndicate led by the Irish developer Derek Quinlan fought off a Saudi oil sheikh, Prince al-Waleed bin Talal, to buy the Savoy Hotel in London (along with Claridge's and the Connaught) , one of Quinlan's employees had the Irish tricolour flown from the roof, like the Russians taking the Reichstag. "I cried," Quinlan recalled. "My father who was in the Irish Army would have loved to have seen this."

Quinlan sold the hotel to Prince al-Waleed a year later, and it's now him and Lloyd's Bank that's stuck with the seemingly bottomless pit. Possibly the only case where it wasn't the Irish patriot-developers who locked the Irish taxpayer into a bad deal.

Image: Flag of the Kingdom of Saudi Arabia.

When things matter

Around 300 people died in the Lampedusa migrant tragedy. The death toll is not that far removed from the number gassed by Bashar al-Assad in the Ghouta suburb of Damascus. Yet Lampedusa has attracted nothing like the attention of the al-Assad chemical attack, for one simple reason: there's no prospect that the USA would attack anyone over Lampedusa, and therefore nothing to people to pose and strut in arguing against. And of course, the EU is doing such a great job of admitting those Syrians that it doesn't want to intervene directly to protect, so who could doubt their commitment to Eritrean migrants?

Tuesday, October 08, 2013

Centrists say it destroys half of America

National Review's The Corner takes the mood of US House Republicans --

Representative Paul Broun (R., Ga.) agrees, and says Boehner risks an internal rebellion if he decides to broker a compromise. “America is going to be destroyed by Obamacare, so whatever deal is put together must at least reschedule the implementation of Obamacare,” he says. “This law is going to destroy America and everything in America, and we need to stop it.”

You'll never beat the Irish

Wall Street Journal today --

Chronic electrical surges at the massive new data-storage facility central to the National Security Agency's spying operation have destroyed hundreds of thousands of dollars worth of machinery and delayed the center's opening for a year, according to project documents and current and former officials. There have been 10 meltdowns in the past 13 months that have prevented the NSA from using computers at its new Utah data-storage center, slated to be the spy agency's largest, according to project documents reviewed by The Wall Street Journal ... But without a reliable electrical system to run computers and keep them cool, the NSA's global surveillance data systems can't function. The NSA chose Bluffdale, Utah, to house the data center largely because of the abundance of cheap electricity. It continuously uses 65 megawatts, which could power a small city of at least 20,000, at a cost of more than $1 million a month, according to project officials and documents.

Recent Guardian article on why tech firms locate in Ireland --

The country's mist, rain and chilly air have all become selling points: Google and other multinationals say that the Irish weather is now one of the main attractions for global computer and online corporations setting up data centres in the Republic. The Silicon Valley firm has just established a $75m (£46.2m) data processing centre alongside its European headquarters in Dublin, insisting that the chilly climate makes it more energy efficient – and hence "greener" – to cool down its servers.

Thursday, October 03, 2013

Tuesday, October 01, 2013

Headline of the Day

Bikini-clad woman creates furor

Kuwait Times.

The resolution -- The officers left the beach after the woman eventually agreed to stay away from the public’s eyes.