We all need more team spirit. Obama's Afghanistan team is in disarray. Their egos seem to be as bloated as the ego's in the French soccer team.
While President Obama is angry with McChrystal's frank comments and perhaps insubordination, President Sarkozy is reportedly furious over the national team's behaviour inside and outside the soccer stadiums. It was not really a "team." He even cleared his schedule for a one hour meeting with the captain on the day of a general labor strike. That shows how important the soccer team is for France as a symbol of national integration and unity.
Germany's coalition government has been in disarray for months as well with some calling each other "wild pigs" and "gherkin troops" (rank amateurs). (There are also rumors that one cabinet member called the defense minister "rumpelstiltskin.") Though, thanks to the national soccer team's victory over Ghana today, Merkel's government won't collapse yet. ;-)
If Germany had failed to make it into the round of sixteen for the first time in history, it would have been a national fiasco. Let's do not forget that the German coach is not called "Trainer der Nationalmannschaft," but goes by the official sounding name "Bundestrainer," just like the top government titles "Bundeskanzler," "Bundespräsident" etc.
On Sunday, we will play against England. One British fan said on TV that the world cup was invented for England and Germany to play against each other. Good point. Still, it is regrettable (but not at all surprising) that the British tabloid The Sun uses military language to describe the upcoming match. Come on, guys. It's just soccer. The real war is in Afghanistan.
Continue reading "US, France and Germany: Divisions and Lack of Professionalism Everywhere"
This is a guest blog post by Donald Stadler, an American living and working in London:
Washington Post economics columnist Robert Samuelson recently wrote a piece about the trade impact of the oil shock on the US, quoting economist Jeffrey Rubin of CIBC World Markets, who predicts that oil will go to $225 a barrel/$7 a gallon before this is finished.
Apart from the obvious impact on per-liter fuel prices in Europe (I have heard of diesel prices as high as £1.99 a litre in the UK), there are some interesting side effects on world trade.
The bottom line is that shipping cheap manufactures thousands of miles make much less sense than it has this past decade. Since 2000 the cost of shipping a 40 foot shipping container from East Asia to the US has gone from $3000 to $8000, and if oil prices go to $200 a barrel this will go to $15,000 per container.
Some production will be brought back to the US and Europe, and other production will go from Asia to nearby low-wage countries like Mexico (for the US) and Poland/Bulgaria/Romania, and perhaps Russia and Turkey (for the EU). This may be good news for factory workers in Italy and in depressed areas of Germany and the UK.
Continue reading "The Impact of the Oil Shock: Trade Networks Shrink"
A tip from our reader Don has led us to an article in the London Times. In it, economics columnist Anatole Kaletsky argues that the astronomical oil price is not caused by economic fundamentals like supply and demand,
but rather the product of a typical financial boom-bust cycle, which could be deflated - especially with some help from sensible political action - as quickly as it built up. [...]
In the late stages of financial bubbles, it is quite normal for prices to become completely detached from economic fundamentals. House prices in Florida and Spain kept rising even after property developers built far more homes than they could possibly sell. The same thing happened in credit markets: mortgage securities kept rising even while banks created “special purpose vehicles” to acquire vast “inventories” of bonds for which there were no genuine buyers - and dozens of similar examples can be cited from the bubbles in internet stocks and Japan. Similarly, the International Gold Council reported this week that gold demand for commercial uses and investment fell 17 per cent in January, just as the gold price surged through $1,000 for the first time.
Now consider the situation today in oil markets: the Gulf, according to Mr Rothman, is crammed with supertankers chartered by oil-producing governments to hold the inventories of oil they are pumping but cannot sell. That physical oil is in excess supply at today's prices does not mean that producers are somehow cheating by storing their oil in tankers or keeping it in the ground. All it suggests is that there are few buyers for physical oil cargoes at today's prices, but there are plenty of buyers for pieces of paper linked to the price of oil next month and next year. This situation is exactly analogous to the bubble in credit markets a year ago, where nobody wanted to buy sub-prime mortgage bonds, but there was plenty of demand for “financial derivatives” that allowed investors to bet on the future value of these bonds.
The article quotes a book by George Soros which is available on Amazon.de or Amazon.com.