Financial Times (December 17)
With preliminary agreement on a permanent crisis mechanism, the EU has finally moved “to avoid future crises.” The permanent mechanism is not quite a done deal. The pact would take effect in 2013, following approval by EU leaders in March and then by the EU’s 27 member states. In the meantime, however, market concern remains centered on the ability of EU states and banks to attain adequate debt financing, a potentially explosive issue the EU has continued to dodge. The Financial Times believes these immediate concerns must now be addressed. “Europe will only be able to enjoy tomorrow if it first deals with the problems of today.”
Tags: Banks, Crisis mechanism, Debt, EU
Boston Globe (December 12)
Mark Zuckerberg, founder of Facebook, is among the latest to commit to the Giving Pledge. Warren Buffet and Bill Gates launched the Pledge, which asks the rich to donate at least half of their fortunes to charity. The Globe finds it “reassuring that many of America’s wealthiest business people seem willing to step up and answer the call.”
Tags: Buffet, Facebook, Gates, Giving pledge, Zuckerberg
Financial Times (December 10)
For several years, “China has displayed a smiling face to the world and promoted its economic prowess.” The mask is off. “Beijing has again revealed a forbidding, autocratic scowl.” The Financial Times believes China should simply have ignored the selection of Liu Xiaobo for the Nobel Peace Prize. By making an issue of this, “China is behaving like a world-class bully.”
Tags: China, Liu Xiaobo, Nobel
Economist (December 9)
A divergence in growth between “the world’s big three” during 2011 may “compound the risks in each one.” In Europe, growth will slow as governments tighten spending. The euro zone will also face continued stress over both its currency and banking model. The U.S. could grow at a rapid 4% thanks to new tax cuts, but face inflationary pressure and even “a bond-market bust” as the deficit soars. Emerging markets will walk a tight-rope between risking inflation by doing too little and dampening growth by doing too much. “Either way, the chances of a macroeconomic shock emanating from the emerging world are rising steeply.” For the record, the Economist still views Japan as “an economic heavyweight,” but believes Japan is less likely to impact the global economy with surprises in 2011.
Tags: 2011, Economic outlook, Emerging markets, Europe, Japan, U.S.
Institutional Investor (December)
The Mandarin Oriental Tokyo was named the world’s best hotel by Institutional Investor. The Mandarin received a score of 98.7, beating out competitors such as the Peninsula Beijing (94.1) and the Ritz Carlton Central Park New York (92.3). The results are based on the responses of senior finance executives from 35 countries who averaged 52 nights on the road in the previous year.
New York Times (December 5)
Alistair Darling writes that European leaders need to “address the root causes” behind the ongoing European crisis. “It is not enough for the euro zone nations to bail out each economy as it falls into a crisis—they must address the root causes of the continent’s problems.” The Former British Chancellor of the Exchequer (2007–2010) and current member of British Parliament identifies the root cause as the limited “political and economic union that underpins” the common currency. As a first step, Darling recommends that the European Central Bank “make a firm commitment to buying government bonds from at-risk countries.” Darling provides other suggestions and urges European leaders to act quickly to address what has become “the single largest threat to the fragile global recovery.”
Alistair Darling writes that European leaders need to “address the root causes” behind the ongoing European crisis. “It is not enough for the euro zone nations to bail out each economy as it falls into a crisis—they must address the root causes of the continent’s problems.” The Former British Chancellor of the Exchequer (2007–2010) and current member of British Parliament identifies the root cause as the limited “political and economic union that underpins” the common currency. As a first step, Darling recommends that the European Central Bank “make a firm commitment to buying government bonds from at-risk countries.” Darling provides other suggestions and urges European leaders to act quickly to address what has become “the single largest threat to the fragile global recovery.”
Tags: Alistair Darling, Currency crisis, euro, Euro zone
Wall Street Journal (December 3)
FIFA, the international governing body of soccer, “makes the United Nations seem like a model—well, almost—of transparency and good governance. Even the International Olympic Committee, no stranger to corruption and foul play, benefits by comparison.” The Journal is upset by recent allegations of vote buying and collusion in site selection, which may have benefitted Russia and Qatar at the expense of the UK and the U.S.
Economist (December 2)
The euro is lurching from crisis to crisis. The Economist hopes the currency will survive. European leaders should be doing more. “Breaking up the euro is not unthinkable, just very costly. Because they refuse to face up to the possibility that it might happen, Europe’s leaders are failing to take the measures necessary to avert it.”
Tags: Currency crisis, euro, European leaders
New York Times (December 1)
Thomas M. Hoenig, President of the Federal Reserve Bank of Kansas City, writes that U.S. banks are still too big to fail. They need to be cut down to size. “More financial firms — with none too big to fail — would mean less concentrated financial power, less concentrated risk and better access and service for American businesses and the public.”
Tags: Banks, Regulation, Too big to fail, U.S.
Boston Globe (November 30, 2010)
Confidential U.S. government documents have been released on WikiLeaks. The Obama administration has condemned the leaks. The Boston Globe points out the government should shoulder some blame. “It is far too easy for low-level insiders to throw open a back door to the government’s most valuable secrets.” Ultimately, it is the government’s responsibility to keep state secrets secure.
Tags: Data security, U.S. Government, WikiLeaks
