Quotulatiousness

March 31, 2013

The deep strangeness of the Cyprus bank haircuts

Filed under: Economics, Europe, Greece, Russia — Tags: , — Nicholas @ 11:36

At Forbes, Tim Worstall has some thoughts on the oddities now apparent in how the Cyprus banking crisis has played out so far:

Now that we’re seeing the real numbers coming out about who loses what in the Cyprus haircut/bank consolidations there’s something very strange about the numbers. Whiffy even, and that’s not with a good odour to it either. For, as far as I can tell at least, the haircuts are far larger than they need to be in order to make good the damage that we were told about. I’m therefore coming around to the idea that this wasn’t what we’ve been told it was, a story of Russian offshore deposits and tax avoidance. Rather, it’s two banks which invested regular domestic deposits into just terrible opportunities and then lost it all.

I don’t think I can make the case absolutely but I think it’s a case worth at least investigating.

[. . .]

But back to the point I’m trying to work through here. We’ve been told that the immediate cause was all about all that foreign money which flooded the country’s banking system. Yet when we look at the amount that is being raised by the haircuts it doesn’t look as if the two bankrupt banks had all that much of those foreign deposits. It looks very much like the banks which had the deposits didn’t invest badly and thus didn’t go bankrupt. So the problem isn’t therefore one of all that foreign money.

Rather, it’s a problem of where those two banks invested their deposits. And it looks as if this was largely in Greek Government and Cypriot Government bonds. Which is why they are bust.

The question is not whether armed drones will be deployed domestically, but when

Filed under: Law, Liberty, Technology, USA — Tags: , , , , , , — Nicholas @ 11:01

Glenn Greenwald presents a strong case that it is inevitable that armed drones will be deployed over the US:

The use of drones by domestic US law enforcement agencies is growing rapidly, both in terms of numbers and types of usage. As a result, civil liberties and privacy groups led by the ACLU — while accepting that domestic drones are inevitable — have been devoting increasing efforts to publicizing their unique dangers and agitating for statutory limits. These efforts are being impeded by those who mock the idea that domestic drones pose unique dangers (often the same people who mock concern over their usage on foreign soil). This dismissive posture is grounded not only in soft authoritarianism (a religious-type faith in the Goodness of US political leaders and state power generally) but also ignorance over current drone capabilities, the ways drones are now being developed and marketed for domestic use, and the activities of the increasingly powerful domestic drone lobby. So it’s quite worthwhile to lay out the key under-discussed facts shaping this issue.

I’m going to focus here most on domestic surveillance drones, but I want to say a few words about weaponized drones. The belief that weaponized drones won’t be used on US soil is patently irrational. Of course they will be. It’s not just likely but inevitable. Police departments are already speaking openly about how their drones “could be equipped to carry nonlethal weapons such as Tasers or a bean-bag gun.” The drone industry has already developed and is now aggressively marketing precisely such weaponized drones for domestic law enforcement use. It likely won’t be in the form that has received the most media attention: the type of large Predator or Reaper drones that shoot Hellfire missiles which destroy homes and cars in Pakistan, Yemen, Somalia, Afghanistan and multiple other countries aimed at Muslims (although US law enforcement agencies already possess Predator drones and have used them over US soil for surveillance).

Ralph Klein, RIP

Filed under: Cancon, History, Media, Politics — Tags: , , , — Nicholas @ 09:47

In Maclean’s, Colby Cosh talks about the late former premier of Alberta:

Ralph Klein, the former premier of Alberta, has died at 70. He shall not now ever be able to collect on the vast debt of apologies he is owed by calumniators, false chroniclers, lazy pundits, and political enemies. The misunderstandings of Ralph have been copious and mostly deliberate. He is still routinely characterized as an anti-gay social conservative in league with sinister theocratic forces, even though he was personally about as churchy as an alley cat. More importantly, he took a diamond-hard line against the use of the “notwithstanding” clause after the Supreme Court wrote sexual orientation into Alberta’s discrimination law in the Vriend decision; and he insisted the public accept the court’s verdict.

He is accused of failing to maximize the public benefits of Alberta’s resource wealth and “save” oil and gas funds for the future, although government resource revenues grew more than fourfold in his 14 years as premier and the net financial position of the province improved by $43 billion. Both promptly collapsed under his bamboozled successor Ed Stelmach, and have not yet recovered to Ralphian levels. Klein is also charged with failing to pay enough conscious attention to economic diversification, a concept that served as the pretext for a hundred costly boondoggles under earlier Conservative regimes; yet somehow he succeeded in presiding over an Alberta economy whose GDP moved sharply away from energy-dependence, and which saw the emergence of previously unimaginable non-energy businesses like software maker Matrikon and game manufacturer BioWare. Whether or not you care to give an iota of credit to Klein, his rule coincided with Alberta becoming a place young technicians and entrepreneurs don’t have to be stupid not to leave.

[. . .]

There is a basic failure among diehard enemies of the Klein government to accept the evidence that his energy, privatization, and flat-tax policies increased the Alberta government’s capacity to spend and provide services — that the more we got of Klein, the safer and more lavish their cherished government entitlements appeared to be. They are not at all safe now; the profoundest irony of Klein’s demise is that it has arrived at a moment in which present premier Alison Redford faces choices like those Klein confronted when he captured the Progressive Conservative leadership in 1992.

Indeed, when Redford’s heavily obfuscated budget plans are translated into English, one sees that the next few years in Alberta must inevitably resemble the early days of Kleinism. Premier Redford is trying to protect spending on infrastructure to prevent a “deficit” in upkeep on buildings and transport, of the sort that materialized after Klein’s initial austerities. But operational spending, particularly on personnel expenses, is bound to be slashed, Klein-fashion. And the slashes will have to be all the deeper if the bridges are going to get painted. A fierce fight with the public sector (whose unfunded pension liabilities grew 80% between Klein’s last budget and Stelmach’s second) is already taking shape, with teachers, doctors, and pharmacists on the verge of all-out war over their pay envelopes. Haven’t the Klein-haters who fell over themselves to vote for internationalist, socially concerned Alison seen this movie before?

Powered by WordPress