Quotulatiousness

November 28, 2011

The real reason the German bond auction failed

Filed under: Economics, Europe — Tags: , , , , — Nicholas @ 08:58

Tyler Cowen explains:

If Germany and a few other, smaller AAA countries were to guarantee or monetize the debts of Italy, Spain, and possibly France and Belgium, never mind Greece and Portugal, Germany would not be AAA itself. The German median voter has very little interest in guaranteeing the above-mentioned debts. If German yields are flipping upwards, it is, in my view, because investors now see the whole euro deal as unraveling and don’t want to deal with the complexities and flak. A big chunk of the German auction didn’t sell at all. You don’t have to think that Germany is ripe to default to see that markets are warning Germany not to take on the whole burden.

The only remaining question, if Germany isn’t willing to take on the entire burden of European debt, is when will the whole edifice come crashing down and who’ll manage not to be crushed by falling debris.

November 24, 2011

Nigel Farage on “German-dominated Europe”

Filed under: Bureaucracy, Economics, Europe — Tags: , , , — Nicholas @ 08:59

November 23, 2011

The political delusion: “We must re-establish the primacy of politics over the market”

Filed under: Economics, Europe — Tags: , — Nicholas @ 10:06

That’s Angela Merkel, expressing the thought that many politicians have, but rarely speak out loud. There’s a lot of wishful thinking wrapped up in that statement:

“We must re-establish the primacy of politics over the market.” That sentence, spoken a little while ago by Germany’s Angela Merkel, sums up the startlingly unoriginal character of the approach adopted by most EU politicians as they seek to save the common currency from what even Paul Krugman seems to concede is its current trajectory towards immolation.

As every good European career politician (is there any other type?) knows, the euro project was never primarily about good economics, let alone a devious “neoliberal” conspiracy to let loose the dreaded market to wreck havoc upon unsuspecting Europeans. The euro was always essentially about the use of an economic tool to realize a political grand design: European unification. Major backers of the common currency back in the 1990s, such as Jacques Delors and Helmut Kohl, never hid the fact that this was their ultimate ambition. Nor did they trouble to hide their disdain of those who thought the whole enterprise would end in tears.

From the common currency project’s beginning, economic considerations were continually subordinated to the goal of using the euro to cement political bonds. That’s why most countries were allowed to enter the euro despite not having met some basic entry criteria. It also explains why no one really seemed to care too much when Greece admitted in 2004 that it had fudged, distorted, and lied its way into the euro club. Now, however, Europe is discovering what happens when political games diminish a currency’s ability to reflect economic facts on the ground.

H/T to “Monty” at Ace of Spades HQ, who commented:

This in a nutshell is everything that is wrong with the sovereign governments of both Europe and the United States (and China, and Russia, and…well, you get my point). The “market” is not a thing to be managed, or a process to be controlled. The market is just an aspect of the natural world, working on the creatures who move through it. Merkel’s comment reflects the combination of arrogance and ignorance that is at the root of so many of our economic problems.

November 22, 2011

Acronym watch: “In the euro zone farmyard, it’s time to forget about the PIGS and start counting the broken EEGs”

Filed under: Economics, Europe, Humour — Tags: , , , — Nicholas @ 09:36

The journalists will appreciate this new acronym:

The euro zone needs a new acronym. For the past three years, PIGS has served as a catchall for the cash-strapped states on the single currency’s periphery. But now that the crisis has moved to the core, a change is overdue.

PIGS has proved surprisingly durable. When it was first coined, citizens of Portugal, Ireland, Greece and Spain were understandably upset at being lumped together in such a derogatory way. Yet as Ireland and Portugal followed Greece in seeking bailouts, their similarities outweighed historical differences.

Some felt the acronym was self-fulfilling, giving attention-deprived speculators a handy shortlist from which to select their next sovereign victim. However, its survival was also an accident. When Italy got into trouble earlier this year, it slotted smoothly into the slot previously reserved for bailed-out Ireland. Politically sensitive bodies avoided the zoomorphic insult by reshuffling the letters to create the GIPS.

[. . .]

A better idea might be to start with the one remaining euro zone member that isn’t under attack from the bond markets. Andrew Balls, head of European portfolio management at PIMCO, now describes the euro zone states being shunned by investors as EEGs: Everyone Except Germany.

November 17, 2011

Snapshots from Greece

Filed under: Economics, Europe, Media, Politics — Tags: , , , — Nicholas @ 07:54

Brendan O’Neill has a few snippets from Athens:

‘Prime ministers should be chosen by us, not Angela Merkel,’ says the taxi driver taking me to the Acropolis. Taxi drivers here love talking politics, and they love hating Merkel. She’s treated as the arch villain of this tragedy. Magazine covers show a massive Merkel playing with Greek politicians as if they were dolls. Graffiti invites her to do things that are probably anatomically impossible. My advice to her is to avoid visiting Greece for the duration of The 100 Days. Probably longer.

•••

The taxi driver also tells me he can’t relate to Papademos. ‘He’s not a man of the people’. But it’s precisely Papademos’s lack of experience in dealing with the grubby, demanding demos that endears him to the EU elite, which fought tooth-and-catapult to have him installed as PM. As one European economist put it: for Brussels the great thing about Papademos is that he ‘speaks the language and shares the philosophy of [the] EU and ECB’ and that he ‘comes in without officially representing a party’. That is, he’s apolitical, unchosen, boring and bureaucratic — just the kind of politician the EU likes. It’s already a cliché, but that doesn’t stop it being true: Athens is now both the birthplace and graveyard of European democracy.

•••

Yet the graffiti expresses exasperation as well as anger — a deep disappointment with Greek workers. Commonly scrawled phrases are ‘Wake up!’ and ‘Stop being slaves!’ You get the impression that the Greek left, which is rowdier and noisier than its western European counterpart, is as annoyed with the masses as it is with Merkel. In Syntagma Square, nothing much remains of the radical protest camp that so excited outside observers earlier this year and which provided the template for the global ‘Occupy’ movement. There is just a memorial tree, with political paraphernalia attached to it in remembrance of the camp. It’s like one of those shrines that pops up on roadsides where someone has been killed by a speeding car, only it is adorned, not with wreaths, but with balaclavas, goggles and batteries (which were thrown at the police). It has the unwitting whiff of being a gravestone not only for the Greek left, but for Greek politics itself.

November 13, 2011

The report from Greece

Filed under: Economics, Europe — Tags: , , , — Nicholas @ 12:16

Michael Petrou and Stavroula Logothettis survey the Greek debt crisis in a report that Maclean’s cheekily headlines “Acropolis Now”:

“We are finished as a nation,” says Marko Gjini, a 39-year-old unemployed construction worker in Athens. “The country has been sold off. We have no say in anything anymore. Greece is owned by the Germans.”

Like many Greeks these days, Gjini is bitter and despondent because of his country’s financial mess, and the austerity measures that have been imposed in an effort to contain it. His wife, Aleka, a public hospital nurse, has seen her income drop from 1,200 euros a month to 800 euros. Now, facing more taxes and cuts to public expenditures, the family expects to have a net monthly income of less than 500 euros. Marko and Aleka are investing whatever money they can toward English lessons for their twin eight-year-old boys in the hope that they might have a better future somewhere else. “Let the government fall,” says Gjini, “[German Chancellor Angela] Merkel is the boss now anyway.”

[. . .]

For Vaso Gildizi, a Greek freelance writer, events in Cannes were “a national humiliation for the country.” The Greek prime minister was scolded like a schoolboy and sent home. The incident didn’t sit well with many Greeks who were already sour on the bailout deal and the euro itself.

“We’re bankrupt,” says 44-year-old Vasilia Paneli, owner of Bliss, a trendy café a short walk from Syntagma Square and the parliament in Athens. “We know it. The EU knows it. And yet we continue this Greek tragedy. A referendum would at least give us a voice, a chance to speak up for our future.” Paneli was unmoved by French and German threats that a referendum on the bailout deal would have meant a vote on whether to remain in the eurozone. She’d rather Greece leave it. “It’s self-serving,” she says. “I say let’s go back to the drachma.”

[. . .]

William Antholis, a senior fellow at the Brookings Institution think tank, likens flirting with a return to the drachma to “threatening suicide to avoid a lynching.” Greece is in for a painful few years whatever happens, he said in an interview with Maclean’s. The austerity measures are going to bite. But leaving the euro, he says, would be disastrous. The costs could include a run on Greek banks, as people sought to withdraw euros before they were changed to drachmas. Some banks would probably collapse. Greece would likely default on its debts, and would be unable to pay pensions and salaries. Some sectors of the economy built on export might benefit from a new, devalued currency, but at the expense of much heavier blows elsewhere.

November 9, 2011

Under attack by overwhelming economic forces, French and Germans consider retreat to citadel

Filed under: Economics, Europe — Tags: , , , — Nicholas @ 14:42

If they’re floating ideas like this, the Euro is done:

German and French officials have discussed plans for a radical overhaul of the European Union that would involve establishing a more integrated and potentially smaller euro zone, EU sources say.

French President Nicolas Sarkozy gave some flavor of his thinking during an address to students in the eastern French city of Strasbourg on Tuesday, when he said a two-speed Europe — the euro zone moving ahead more rapidly than all 27 countries in the EU — was the only model for the future.

The discussions among senior policymakers in Paris, Berlin and Brussels go further, raising the possibility of one or more countries leaving the euro zone, while the remaining core pushes on toward deeper economic integration, including on tax and fiscal policy.

As in any retreat, some outlying forces (countries) will have to be sacrificed to save the main body (France and Germany). A small retreat may not be enough — but Greece, Italy, Spain, and Portugal are likely to be left outside the walls.

September 29, 2011

Charles de Gaulle as euro-skeptic

Filed under: Economics, Europe, History — Tags: , , — Nicholas @ 09:13

Conrad Black provides a thumbnail sketch of de Gaulle’s real intentions regarding European integration:

Charles de Gaulle was born in Lille in 1890, to the family of a monarchist schoolteacher. De Gaulle was a Flaubertesque haut bourgeois, as well as an officer of the French army when it was rivaled only by the German army as the greatest in the world, and was unrivaled as the most storied army of all. He was imbued with the middle-class concept of the value of savings, frugality, pay-as-you-go. To him, greatness and security could never be bought or sustained on the installment plan. And mere politicians, whom he considered a lesser breed swimming in a sticky fondue of moral weakness and opportunism, could never be trusted to resist the temptation to pander, devalue, or seek short-term gain.

De Gaulle’s farsightedness was not confined to national projections of household economics; he also warned of the dangers of Euro-integration. He was the chief architect of the Franco-German friendship treaty of 1963, and — as a veteran of the terrible hecatomb of the Battle of Verdun and a World War I prisoner of war of the Germans, as well as the founder of the Free French in World War II — he knew as well as anyone the horrors of the centuries-long conflict along the Rhine. He also favored a common market and the end of violent ancient rivalries among the many European nationalities. But he always saw a homogenized, centralized Europe as a dangerous fantasy. He believed that a Continental interest, composed of as many as 20 or 25 languages and cultures, would be only an alphabet gruel, blended and stirred by faceless bureaucrats from the little countries, and not representing any real popular interest at all.

He thought that the original Common Market of France, West Germany, Italy, and Benelux could be used by France, effectively maneuvering between the U.S. and the USSR, and between Germany and the Russians, to project and amplify France’s — and, more particularly, his own — influence. Up to a point, while the U.S. was mired in Vietnam, and before European Communism became too enfeebled to challenge the West (which de Gaulle also foresaw), he was correct. But he believed that an unlimitedly accessible Europe would become an incoherent Tower of Babel, governed by bureaucratic intermeddlers in the name of feckless politicians, and liable to excessive outside influence, including from the U.S.

H/T to Monty at Ace of Spades HQ for the link.

September 22, 2011

We need to borrow another word from German

Filed under: Randomness — Tags: , — Nicholas @ 12:29

The English language is adept at picking up bits of vocabulary from other languages — it’s one of the greatest strengths of English. I’ve just read of a word in German that I have needed for decades:

Schadenfreude captures a much more complex psychological concept, and therefore lacks a single-word counterpart in the English dictionary (Schadenfreude itself is a combination of the German words Schaden and Freude; meaning damage and joy respectively).

Nonetheless, Schadenfreude is such a basic human experience, that it is only natural that — if you don’t develop your own word for it — you would certainly want to adopt somebody else’s word for it into your vocabulary.

Another word that seems similarly essential to describing a particular feeling that most humans experience at some time or another, but which — unlike Schadenfreude — has somehow evaded incorporation into the English language, appears in the verb “Fremdschämen“:

Fremdschämen describes embarrassment which is experienced in response to someone else’s actions, but it is markedly different from simply being embarrassed for someone else. In particular it is different from being embarrassed because of how another person’s actions reflect on us or because of how another person’s actions make us look in the eyes of others.

Instead, Fremdscham (the noun) describes the almost-horror you feel when you notice that somebody is oblivious to how embarrassing they truly are. Fremdscham occurs when someone who should feel embarrassed for themselves simply is not, and you start feeling embarrassment in their place. It is at the heart of beloved “mockumentaries” such as The Office, Modern Family, or Ricky Gervais’ Extras. It is also what makes the auditions for American Idol, Britain’s got Talent and Deutschland Sucht den Superstar so discomfortingly entertaining…

I can now use the correct word to express how almost-physically-painful I feel when I see someone else get embarrassed or humiliated. Fremdschämen. I must remember that.

August 27, 2011

Germany is an intensely weird place

Filed under: Europe, History — Tags: , , — Nicholas @ 12:30

Michael Lewis highlights one of the ways Germany is different from anywhere else on the planet:

Published in 1984 by a distinguished anthropologist named Alan Dundes, Life Is Like a Chicken Coop Ladder set out to describe the German character through the stories that ordinary Germans liked to tell one another. Dundes specialized in folklore, and in German folklore, as he put it, “one finds an inordinate number of texts concerned with anality. Scheisse (shit), Dreck (dirt), Mist (manure), Arsch (ass).… Folksongs, folktales, proverbs, riddles, folk speech — all attest to the Germans’ longstanding special interest in this area of human activity.”

He then proceeded to pile up a shockingly high stack of evidence to support his theory. There’s a popular German folk character called der Dukatenscheisser (“The Money Shitter”), who is commonly depicted crapping coins from his rear end. Europe’s only museum devoted exclusively to toilets was built in Munich. The German word for “shit” performs a vast number of bizarre linguistic duties — for instance, a common German term of endearment was once “my little shit bag.” The first thing Gutenberg sought to publish, after the Bible, was a laxative timetable he called a “Purgation-Calendar.” Then there are the astonishing number of anal German folk sayings: “As the fish lives in water, so does the shit stick to the asshole!,” to select but one of the seemingly endless examples.

Dundes caused a bit of a stir, for an anthropologist, by tracking this single low national character trait into the most important moments in German history. The fiercely scatological Martin Luther (“I am like ripe shit, and the world is a gigantic asshole,” Luther once explained) had the idea that launched the Protestant Reformation while sitting on the john. Mozart’s letters revealed a mind, as Dundes put it, whose “indulgence in fecal imagery may be virtually unmatched.” One of Hitler’s favorite words was Scheisskerl (“shithead”): he apparently used it to describe not only other people but himself as well. After the war, Hitler’s doctors told U.S. intelligence officers that their patient had devoted surprising energy to examining his own feces, and there was pretty strong evidence that one of his favorite things to do with women was to have them poop on him. Perhaps Hitler was so persuasive to Germans, Dundes suggested, because he shared their quintessential trait, a public abhorrence of filth that masked a private obsession. “The combination of clean and dirty: clean exterior-dirty interior, or clean form and dirty content — is very much a part of the German national character,” he wrote.

July 18, 2011

Soviet tank battles

Filed under: Europe, History, Military — Tags: , , — Nicholas @ 00:06

I just picked up a copy of The Battle of Kursk by David M. Glantz and Jonathan M. House, based on a recommendation by Jim Dunnigan in his World War II Bookshelf. While any attempt to pick the top books about the Second World War is doomed to perpetual nit-picking by second-guessers and Monday Morning Quarterbacks, I’ve generally found the works he recommended to be worth reading.

Although I’ve read much about World War II, I haven’t read much about arguably the most critical part of the entire war: the gargantuan battles pitting the Soviet Red Army against Hitler’s Wehrmacht. Some of that is just sheer pig-headedness: I used to work for the biggest wargame store in Toronto, back when wargames meant cardboard counters, vast paper hexagonal maps, and charts and tables galore. The hardest of the hard-core gamers seemed to be either Napoleonic grognards (down to the secret stash of sabres and shakos in the gaming room) or even more dedicated junkies of the “Great Patriotic War”/”Operation Barbarossa”. Some of the latter were genuinely crazy, right down to the barely contained hints that “Hitler was just misunderstood”.

On the assumption that certain forms of craziness are contagious, I avoided most of the latter as much as I could, consistent with my duty to sell them the latest and greatest game involving their particular passion.

One day, perhaps in a fit of weakness, I allowed myself to get lectured by one of the fanatics about the details of the Battle of Kursk. The fan who felt the need to bend my ear was eager to impart information about some “famous battle” that turned out to have been a serious tactical miscalculation by a Soviet officer. The story, as he told it, had a very large formation of Soviet tanks “taking a shortcut” through a major minefield, resulting in many disabled/destroyed tanks and wounded or dead men. In the telling, this kind of thing could not be admitted as having happened without some enemy contact, so it was propagandized as being a major tank battle involving significant formations of German panzer troops and/or SS units (of whom, of course, the glorious defenders of the Motherland took a greater toll than they suffered themselves).

I’d heard a couple of variations of this story by this point, but none of them could name the general who led the formation, the location of the event, or the “battle” that was supposedly re-written for propaganda purposes.

Does this story ring a bell for anyone? I’d imagine if it had really happened in a way close to the way it was told to me, it would have been documented in great detail (especially after the fall of the Soviet Union, in that brief period that both the Soviet and the Nazi records were available to western researchers without direct censorship).

July 17, 2011

Saudi Arabia upgrades their armoured forces

Filed under: Middle East, Military, Technology — Tags: , , , — Nicholas @ 10:49

Saudi Arabia will add a few hundred of the most up-to-date panzers to their defence forces:

Saudi Arabia is buying 244 Leopard 2A7+ tanks from Germany. Saudi Arabia is believed to have already ordered 44, and now has increased that order. It was only a year ago that German tank manufacturer KMW has revealed this, the latest version of its Leopard 2.

Two years ago, the German Army announced that it was going to upgrade 150 of its Leopard 2A6 tanks to the A7 standard. That would include more armor on the sides and rear (especially to protect against RPGs), more external cameras (so the crew inside could see anything in any direction, day or night), a remote control machine-gun station on top of the turret, better fire control and combat control computers and displays, more powerful auxiliary power unit and better air conditioning, and numerous other minor improvements. This would increase the weight of the tank to nearly 70 tons.

[. . .]

Saudi Arabia is concerned about Iran, which has a force of 1,500 much older tanks (most of them Russian T-72s and T-54/55s). Saudi Arabia has 1,300 tanks, most of them older American M-60s and French AMX-30s. But the Saudis also have 370 U.S. M-1s and 150 Russian T-90s. The 244 Leopards will increase the Saudi edge. The Saudis also have the money to buy spare parts for their modern tanks, and Western instructors to provide the best training. But the Iranians are better soldiers, so they might have an edge there.

June 29, 2011

Corruption as a catalyst for rebellion?

Filed under: Bureaucracy, Government, Politics — Tags: , , , , — Nicholas @ 07:26

Austin Bay points out that better communications have been important elements in the “Arab Spring” and other populist protests in the world right now, but there’s another element joining them together:

What links the Arab Spring rebellions with political agitation in China and at least another five dozen simmering or emerging crises?

If your answer is “the Internet,” you have identified one of the key information technologies that spread the flames. However, the common human fire in these disparate struggles is intense disgust with embedded corruption.

Tyrants maintain control by isolating and intimidating their subjects. However, since the advent of the printing press and increasing public literacy, preserving tyrannical isolation has become a bit more difficult.

Over time, subjects become aware of social, cultural, economic and political alternatives to the despot’s rule, despite the despot’s propaganda. Just how deeply West German television influenced East German resistance to communism is debatable, but the Iron Curtain could not hide the overwhelming evidence of Western affluence and the West’s ability to occasionally remove corrupt leaders.

Communist elite corruption amidst systemic economic failure certainly influenced resistance throughout Eastern Europe and the Soviet Union. The special stores and vacation homes enjoyed by Communist Party favorites infuriated workers denied similar access. East European workers knew that they were industrialized serfs in handcuffed societies falling further and further behind Western European nations. In 1989, when the Russians concluded the Eastern European security forces could not — or would not — shoot everyone, the Berlin Wall cracked.

June 9, 2011

Those ungrateful peasants

Filed under: Europe, Government, Humour — Tags: , , , , — Nicholas @ 09:09

I had wondered about the origins of that bit of verse:

I asked if people were perhaps not tricked, but legitimately voting against the left because they objected to socialist policies such a massive spending and multiculturalism.

He responded that these issues were indeed difficult for ‘common people’ to comprehend, and therefore for the right to take advantage of. He reiterated however that the problem was not with the policies, it was that people did not ‘understand’.

This was a revealing statement, for it is a typical line of thinking across the left-wing political spectrum, from the most hardened communist to the most moderate social-democrat. While all leftists claim to be for the ‘people’, at the same time they have utter contempt for the people.

They believe they know what is best for the people, and if the people — uppity ungrateful peasants — object, then the people be damned.

Bertolt Brecht — ironically himself a dedicated Marxist — poked fun at this leftist mentality in a now famous poem, Die Lösung (The Solution), following a workers uprising against the Communist East German government in 1956.

    After the uprising of the 17th of June
    The Secretary of the Writers Union
    Had leaflets distributed in the Stalinallee
    Stating that the people
    Had forfeited the confidence of the government
    And could win it back only
    By redoubled efforts. Would it not be easier
    In that case for the government
    To dissolve the people
    And elect another?

June 7, 2011

Not funny: Germany tops another international poll

Filed under: Europe, Humour — Tags: , , — Nicholas @ 10:00

Some national stereotypes are apparently more accurate than we think:

Now an international poll appears to reinforce the humourless national stereotype after concluding that Germany is the least funny country in the world.

More than 30,000 people in 15 countries were asked to rank the nations with the worst sense of humour and Germany came out on top.

But before Britons become too smug, the survey did not rank the UK a great deal higher, placing us fourth behind Russia and Turkey.

Countries including Canada, Holland and Belgium all performed better than the UK when it came to demonstrating wit.

The UK boffins are scrambling to find an answer, as Lester Haines points out:

As the Telegraph notes, humour doesn’t translate too well, so it’s a bit difficult for the average Johnny Foreigner to understand just how complex and advanced we are in this most challenging of fields.

Having said that, the pollees were spot on about the Germans.

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