by Jules Evans | Mar 18, 2008 | Global system, Influence and networks
Back in September 2002, I wrote a cover story for Euromoney called ‘The End of Unfettered Capitalism’. I interviewed various wise sages of finance (Joseph Stiglitz, George Soros, er…Ann Pettifor) who opined to me of the end of neo-liberalism and the need for a new economic model.
Back then, in the aftermath of Enron and the bursting of the internet bubble, the financial press was full of soul-searching and chest-beating articles, usually by John Plender, wondering where free market capitalism had gone wrong and where it was heading.
My article was the culmination of two years of quiet guerilla warfare against free market finance, which I had waged since becoming a financial journalist after university. I secretly hated the free market, which I blamed for frustrating my desire to be a Sixties-style creative hippy. So I spent most of my time writing articles trying to find chinks in the armour of international finance, as an exercise in self-liberation…
It was quite fun to do this, while working at Euromoney – perhaps the arch-organ of international capital. And it was pretty easy to do, in 2000-2002, while financial markets were imploding.
But then, you know what happened? Firstly, I started to find proper outlets for my frustrated hippy creativity, so I became less of an emotional malcontent (one wonders how much radical criticism emerges as much from the emotional maladjustment of the critic as from the political maladjustment of their society); and secondly, I started to realize that actually private financial markets worked quite well, and the people who criticized them – people like Ann Pettifor, for example, or John Pilger, or Noreena Hertz – were by no means experts about the financial systems they criticized. (more…)
by Alex Evans | Mar 18, 2008 | UK
Red Box has found this in PR Week: an organogram of Downing Street’s comms operation. The resolution’s not very good (big version here), but one thing is very clear: Stephen Carter is above everyone else. As Red Box comments, “It would take a huge amount of insider knowledge to put such a thing together without any sort of briefing. Clearly someone helped.” And, Red Box wonders, “how do the others on this graphic feel about it?”.
Well, here’s a starter for ten: Spencer Livermore, who’s been a special adviser to Brown forever, quit yesterday.
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by Alex Evans | Mar 18, 2008 | Climate and resource scarcity, Global system
As the dollar, together with US equity and bond markets, continue an apparently inexorable slide downards, everyone’s been piling into safety – and especially into commodities. But as David Roche comments, “With global equity market capitalisation almost 10 times the notional value of commodity derivatives, the rush to commodities by investors has been like squeezing a quart into a pint pot.”
Opinion has been split on how much of the buoyancy in commodity prices is due to this short term price bubble; Martin Wolf, for instance, argued a couple of weeks ago that “Speculation seems not to be that important. If it were, inventories would be soaring. But they are not.” Still, that was then, and this is now – after the collapse of Bear Stearns, when the flight to safety looks more like a panic rush.
David Roche’s argument, though, is that the commodities bubble will prove short term because global recession will take the heat out of demand for commodities – for “contrary to received wisdom, economic decoupling [between the US and emerging economies] is unlikely.” Well, he may well be right about the decoupling, at any rate; Nouriel Roubini has also been saying so for a while, and he’s been pretty accurate so far.
So if the world does hit a serious downturn, and if commodity prices do take a tumble as a result, does that mean we can all relax about food prices? Not for long. Here’s why.
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by Alex Evans | Mar 17, 2008 | Europe and Central Asia, Global system
…as the eurozone overtakes the United States of America.
FRANKFURT (AFP) — The dollar’s plunge has made the eurozone the world’s biggest economy by one measure and has underscored shifts that are reorienting the 15-nation bloc towards Asia, Russia and oil-rich Gulf states, analysts say.
“With the euro now trading around 1.56 against the dollar, the size of its annual output (at market value) has exceeded that of the United States,” US investment bank Goldman Sachs estimated last week.
by Alex Evans | Mar 17, 2008 | South Asia
The Economist’s James Miles is the only foreign correspondent with official approval to be in Tibet. More photos here.
Security is particularly intense in the Tibetan quarter itself. Helmeted riot police are posted every few metres along its narrow, winding alleyways. Residents are subjected to identity checks as they walk around. In the heart of the district, in front of the Jokhang temple, which is Tibet’s holiest shrine, two armoured personnel carriers are parked. On the front of one big red Chinese characters read: “Stability is Happiness”. On the other it says “Separatism is Disastrous.”
Meanwhile, Tim Johnson – and everyone else – is at the border:
This is an interesting time to be a foreign correspondent in China. Like dozens of colleagues, I am near the border with Tibet but unable to get in. I happen to be in Sichuan province. And I’ve been in contact with colleagues who I know are in Gansu and Qinghai provinces, all trying to get a feel for what’s going on among ethnic Tibetans. It is not easy. We are face some measure of difficulty, trying to outsmart Chinese provincial authorities who would just as soon muzzle the foreign press at times like this. None of us can enter Tibet, which is off limits to foreign reporters without a permit. I know of only one foreign journalist, James Miles of The Economist, who had the good fortune to be in Lhasa as events unfolded over the past few days …
We foreign reporters all take precautions. We have to switch vehicles often. Some of us swap out SIM cards in our mobile phones, or just turn them off. That way, authorities cannot triangulate mobile phone signals and figure out our locations.
A blogger called Kadfly – who’s backpacking around China – is on the ground in Tibet too. His take:
Yes, the Chinese government bears a huge amount of blame for this situation. But the protests yesterday were NOT peaceful. The original protests from the past few days may have been, but all of the eyewitnesses in this room agree the protesters yesterday went from attacking Chinese police to attacking innocent people very, very quickly. They appeared to target Muslim and Han Chinese individuals and businesses first but many Tibetans were also caught in the crossfire.
Here’s his friend Ben’s photo of the Potala Palace by the light of rioters’ fires:
