Saturday, 9 April 2011

The euro crisis: "How low can you go?"

EU Commissioner Olli Rehn on April 8 2011 (after previous Irish and Greek bailouts):




Flashback March 2010:

These clips are "produced by the European Commission's Directorate General for Economic and Financial Affairs and made available to broadcasters":

"The Euro as a Limbo dancer: How low can you go?" (DG ECFIN animation)



"Euro keeps Greek rates stable" (DG ECFIN animation)



"The Euro rocks on the world stage"  (DG ECFIN animation)


"The Euro: a solid foundation for growth" (DG ECFIN animation)





PS

Yes, "How low can you go?" - the only thing Mr. Rehn and his DG ECFIN got right!

Friday, 8 April 2011

Libya: The problem with humanitarian war


                                             Too little, too late?

As things stand now in Libya, a stalemate with madman Gaddafi remaining in power appears more and more likely:

The chief of U.S. military operations in Africa says the situation in Libya is moving toward a stalemate that would leave Moammar Gadhafi in power for an unknown period of time.  General Carter Ham, commander of U.S. Africa Command, spoke Thursday to the Senate’s Armed Services Committee.

General Ham faced tough questioning from some members of the committee, particularly Republicans, who disagree with President Barack Obama’s decision not to use the military to directly oust Gadhafi.

The committee’s senior Republican, Senator John McCain, who lost the 2008 election to President Obama, was particularly tough.  He said the United States lost an opportunity to remove the Libyan leader when it sought an international coalition and took three weeks to put it together. 


Senator McCain is right; the delay caused by the creation of the international coalition made the removal of Gaddafi extremely difficult. The coalition was put together in accordance with the principles of an "immaculate" humanitarian intervention, as described by Stratfor´s George Friedman:

I call humanitarian wars immaculate intervention, because most advocates want to see the outcome limited to preventing war crimes, not extended to include regime change or the imposition of alien values. They want a war of immaculate intentions surgically limited to a singular end without other consequences. And this is where the doctrine of humanitarian war unravels.
---


My unease with humanitarian intervention is not that I don’t think the intent is good and the end moral. It is that the intent frequently gets lost and the moral end is not achieved. Ideology, like passion, fades. But interest has a certain enduring quality. A doctrine of humanitarian warfare that demands an immaculate intervention will fail because the desire to do good is an insufficient basis for war. It does not provide a rigorous military strategy to what is, after all, a war. Neither does it bind a nation’s public to the burdens of the intervention. In the end, the ultimate dishonesties of humanitarian war are the claims that “this won’t hurt much” and “it will be over fast.” In my view, their outcome is usually either a withdrawal without having done much good or a long occupation in which the occupied people are singularly ungrateful.

North Africa is no place for casual war plans and good intentions. It is an old, tough place. If you must go in, go in heavy, go in hard and get out fast. Humanitarian warfare says that you go in light, you go in soft and you stay there long. I have no quarrel with humanitarianism. It is the way the doctrine wages war that concerns me. Getting rid of Gadhafi is something we can all feel good about and which Europe and America can afford. It is the aftermath — the place beyond the immaculate intervention — that concerns me.

Read the entire interesting article by George Friedman here.

PS
Regrettably Obama did not have the guts to "go in heavy, go in hard", which will make it extremely difficult to "get out fast".

Its too late now to Save the Earth: Christie´s Green Auction closed yeasterday!

It is too late now to Save the Earth together with Harrison Ford and other celebrities. The Charitybuzz and Christie´s Green net auction "Bid to Save the Earth" closed last night. One of the top items - estimated value $100,000.00 - was this "adventure" with the famous Hollywood "conservationist" Ford:

"This adventure begins when you and a guest fly Delta BusinessElite to Los Angeles to meet legendary actor and conservationist, Harrison Ford. Fly with him out of Santa Monica Municipal Airport to lunch in one of his amazing aircrafts after enjoying a rare photo opportunity."




Congratulations to the lucky winner! You will have a unique chance to meet this famous activist, who works so hard to promote a sustainable, climate friendly lifestyle (which in his own case includes cheesburger shopping by private airplane):

 " I’m so passionate about flying I often fly up the coast for a cheeseburger. Flying is like good music; it elevates the spirit and it’s an exhilarating freedom.”

Ford owns six airplanes and a helicopter, which allows him to use separate means of aerial transportation for cheesburger shopping each day of the week.

And congratulations also to the lucky person who contributed to Save the Earth by giving the highest bid for this item - estimated value $204,200.00:

"You and up to eleven guests can enjoy a luxury yacht charter valued at US$200,000 along the French Riviera during or after the Cannes Film Festival 2011 aboard the magnificent 190ft superyacht LADY SHERIDAN. Includes two round trip tickets courtesy of Delta Air Lines!
Approximate daily fuel costs for 24 hours of electricity is $1,000 USD and estimated fuel cost for cruising is a $600 USD per hour. The daily costs approximate is $3,400/day based on the average of 4 hours of cruising, which totals an approximate $10,200 for the 3 day trip. Suggested gratuity is 10-20% of the full value of the charter."




Just a couple of simple suggestions to the winner:
Why not enhance the green credentials of your forthcoming cruise with Lady Sheridan: Request your guests to wear climate-friendly, "responsible, ethical and sustainable fashion" while on board. And, of course, the ship bar will serve only Green cocktails and climate-friendly champagne during the trip. To add to the green, climate-chic ambiance, you might also consider asking the crew to turn off the air condition in their cabins.

Fortunately, all items on offer were not as expensive as the ones mentioned above. This chance to Save the Earth was really cheap:

"Four Reserved Seats to a Taping of The Tonight Show with Jay Leno" 
Estimated Value:$0.00

Congratulations to the lucky winner anyway! But remember "Travel and accommodation not included". Maybe you could ask Harrison Ford to fly you to Burbank, California?

New US report: The global shale gas reserves are huge

Earlier today, we reported about the new increased estimates for shale gas in Poland. The same report by the US Energy Information Administration also includes some good energy news for many other parts of the world:

The North American shale-gas bonanza could be the tip of a gigantic natural-gas iceberg, according to a report commissioned by the U.S. Energy Information Administration.
The report, which contains an overview of natural-gas-bearing shale-rock formations in 32 countries, estimates that these contain about 5,760 trillion cubic feet of technically recoverable gas. That is nearly seven times the amount present in the U.S, according to the report, which was released late Tuesday.
The biggest overseas natural-gas shale reserves lie in China, with 1,275 Tcf. Argentina, Mexico, South Africa and Canada are also endowed with massive reserves, the report, written by consultancy Advanced Resources International Inc., said. Other countries with large amounts of gas-rich shale include Libya, Algeria, France and Poland. Each of these countries has hundreds of trillions of cubic feet of shale natural gas that can be exploited using existing technology.
Independent U.S. oil companies learned to unlock the gas trapped in tight shale rock formations in the 1980s and 1990s, and the technique spread during the last decade, triggering an unexpected supply boost in North American natural gas. The EIA report's findings underscore how the propagation of those techniques--based on drilling horizontally in the rock formation, and cracking it with water to release the gas--could unleash a similar natural-gas supply boom around the globe.
Russia, Central Asia, the Middle East, Southeast Asia and Central Africa weren't part of the study.

Read the entire piece here

Good news for Europe: Poland has shale gas for 300 years

A new report published by the US Energy Information Administration is good news for Poland - and Europe in general (except Russia):

Poland has 5.3 trillion cubic meters of shale natural gas, equal to more than 300 years of the country’s annual gas consumption, the Energy Information Administration of the U.S. Department of Energy said in a report.

It’s the largest amount of shale gas for any European state in a study of 32 countries, the agency said.
This is more than the most optimistic estimates available so far. Experts predicted earlier Poland had deposits of between 150 billion and 3 trillion cubic meters

Read the entire WSJ article here.

Polish PM Donald Tusk recently said that his country is determined to produce shale gas to reduce its dependence on gas imported from Russia:

“I will be engaging myself personally, as the head of the Polish government, in the optimization of conditions for the exploration, research, logistics and the business related to the production of shale gas,” he said. “It may happen that one of the fruits of this debate will be what’s priceless: a feeling of security and a hope for the future for millions of people….Poles are waiting for this gas.”

Major US energy companies drilling in Poland have said the the initial findings give reason for optimism.

OilPrice.com predicts "dramatic changes" in the European energy market:

“Shale gas is the most important energy development since the discovery of oil“ 

As already pointed out in our previous special reports, we believe that shale gas is on one hand one of the most important factors of our future energy supply and on the other hand one of the most attractive investment opportunities. Geologists believe unconventional gas to exceed the conventional reserves by a factor of 10. We believe that whatever is deemed “unconventional” gas today will soon be “conventional” gas due to technological progress . We are also convinced that the European energy and gas market will undergo dramatic changes in the coming years, and that the dependence on Russian gas will be a thing of the past. Currently we seem to see the beginning of this transformation process.

If shale gas can really gain a foothold in (Eastern) Europe on a sustainable basis, this would come with extensive effects for Europe. On the one hand the frequent threats by Russia to suspend deliveries would become obsolete, and on the other hand the prices should take their cues from the market prices in the future. At the moment the gas prices in Central Europe are about 100% higher than in America.

According to OilPrice.com there is still a lot of scepticism in Europe towards shale gas:

The scepticism vis-à-vis shale gas is still enormous in Europe. But the sentiment was similar in the USA at the beginning of the 90s. After the USA had gone beyond a “tipping point”, i.e. a critical mass, substantial growth ensued. Production per drilling rig in the USA has almost risen exponentially as a result of improved technologies in production and higher expertise with regard to the geological specificities of shale gas deposits. Improving expertise also results in falling costs. While the costs of the Barnett Shale eight years ago amounted to USD 5/mmBTU , they have meanwhile fallen to USD 3/mmBTU. In 2004 average drilling time was 110 days, today it is 18 days. In addition, many studies substantiate the notion that costs as low as USD 2.5/mmBTU are possible, which means that the production of shale gas would partially be cheaper than the production of conventional gas. Currently we can see the transfer of technology from the USA to Europe. Therefore we assume that the development of shale gas in Europe should progress much more swiftly.

PS
The big danger for Europe is that the ever louder green movement could seriously slow down the exploration and extraction of European shale gas. The growing popularity of the German greens, who seem to think that wind and solar are the answer, is particularly worrisome. Hopefully more sane political forces in Germany and elsewhere do not allow the greenies to dictate energy policy.

Thursday, 7 April 2011

"Murder on the EU express" - Who killed Europe?


The eminent historian (Harvard and LSE) and columnist Niall Ferguson,writing in Newsweek, has confirmed what this blog said on the last day of 2010:
"The end of the euro co-operation will be the beginning of the end of the EU in its present form."
Ferguson´s description of the case is, of course, more elegant and very British:
You remember Agatha Christie’s classic whodunit Murder on the Orient Express? The problem for the great Belgian sleuth Hercule Poirot was that there were far too many suspects. The strange death of the European Union may prove to be a rather similar case.

So used are we to hearing the process of European integration likened to an unstoppable train that we discount the idea it could ever stop in its tracks. Yet the reality is that Europe has been quietly disintegrating for some time.
Outwardly, it’s true, Europe’s leaders still appear to be inching toward their long-cherished goal of “ever closer union.” Last month they agreed to set up a new European Stability Mechanism to deal with future financial crises. It’s still a long way from being the United States of Europe, but most Americans assume that’s the ultimate destination: a truly federal system like their own. Think again. Not only has the economic crisis blown holes in the finances of nearly all EU states, it has also revealed a deep reluctance on the part of those least affected to bail out the hardest hit.

Read the entire article here.

Turkey and Indonesia: "Shining examples of Islamic democracies"?



Turkish president Abdullah Gul, honoured with a doctorate at the University of Indonesia, has praised his own country and Indonesia in a speech in Jakarta:

Turkey and Indonesia are shining examples of Islamic democracies, and offer hope to nations in the Middle East and North Africa seeking to follow the same path.

“It is not only possible, but also desirable, to achieve a functioning democracy,” Gul said on Wednesday at the University of Indonesia, which conferred him with an honorary doctorate in political science.

“By just being us, we serve as a catalyst for reform,” he told cabinet ministers, professors and students in Depok.

Gul said the world’s two leading moderate Muslim-majority nations had a unique role to play in ushering in change as unrest swept the Middle East and Libya.


Read the entire article here.

Turkey and Indonesia may have made some progress towards democracy, but are they "shining examples" of democracy?:

Human Rights Watch
World Report 2011: Indonesia

Over the past 12 years Indonesia has made great strides in becoming a stable, democratic country with a strong civil society and independent media. However, serious human rights concerns remain. While senior officials pay lip service to protecting human rights, they seem unwilling to take the steps necessary to ensure compliance by the security forces with international human rights and punishment for those responsible for abuses.

New allegations of security force involvement in torture emerged in 2010. But the military consistently shields its officers from investigations and the government makes little effort to hold them accountable. The government has also done too little to curb discrimination against and attacks on religious, sexual, and ethnic minorities.

While Indonesia today has a vibrant media, authorities continue to invoke harsh laws criminalizing those who raise controversial issues, chilling peaceful expression. Indonesia has imprisoned more than 100 activists from the Moluccas and Papua for "rebellion" for peacefully voicing political views, holding demonstrations, and raising separatist flags.
In August Indonesian police arrested 21 individuals for planning to float pro-independence flags attached to balloons during a visit to the Moluccas by President Susilo Bambang Yudhoyono. Police subjected them to severe beatings that lasted for days including with wooden sticks and bars and forced them to hold painful stress positions. In September Papuan activist Yusuf Sapakoly, convicted of "rebellion" in 2007 for assisting activists who displayed a pro-independence flag, died of kidney failure after prison authorities denied him medical treatment. In July, after 10 months of delay, prison authorities in Papua permitted political prisoner Filep Karma to travel to Jakarta for necessary surgery.
Indonesia's criminal libel, slander, and "insult" laws prohibit deliberately "insulting" a public official and intentionally publicizing statements that harm another person's reputation, often even if those statements are true. In early 2010 Tukijo, a farmer from Yogyakarta, was sentenced to six months' probation and a three-month suspended prison sentence for criminal defamation after he asked a local official to disclose the results of a land assessment.

Read the entire piece here.

Human Rights Watch
World Report 2011: Turkey

The Justice and Development Party (AKP) government's constitutional amendments open the way for further reforms to strengthen human rights, Human Rights Watch said. But the government has failed to address serious ongoing concerns. These include unjustified prosecutions for alleged speech crimes, the arbitrary use of terrorism laws, unnecessarily prolonged pretrial detention, a clampdown on the legal pro-Kurdish Peace and Democracy Party (BDP), and police violence against demonstrators.
The government's partial revision of the constitution, approved by national referendum in September 2010, paves the way for creating an ombudsperson, limits the role of military courts, and gives individuals the right to petition the constitutional court to challenge the constitutionality of laws. It also ends immunity from prosecution for the leaders of the September 12, 1980 military coup and public officials who committed human rights abuses in its wake, among other reforms.
Despite a climate of increasingly open debate, the government prosecuted and convicted people during 2010 for nonviolent speeches, writings, and participating in demonstrations, Human Rights Watch said.  Journalists and editors are frequent targets for prosecution, with some facing scores of ongoing legal proceedings in 2010.
"The authorities in Turkey see some speech as a threat to be countered rather than a right to be upheld," Ward said. "A confident Turkey has nothing to fear from free expression."
Another problem during 2010 was ill-treatment by the police, particularly during street stops, demonstrations, and arrests.  The use of firearms by the police and the gendarmerie, particularly against unarmed suspects, was also a matter of concern, Human Rights Watch said. There was no progress on tightening rules governing use of force.

Read the entire article here.

Another recent report from Turkey:

The arrest of nine journalists and writers on March 3, 2011, in the absence of clear reasonable cause, will have a chilling effect on free speech, Human Rights Watch said. The nine were accused of links to the alleged "Ergenekon" coup plots against the Turkish government.

Those arrested include Ahmet Şık and Nedim Şener, two prominent journalists known for critical reporting on the Turkish criminal justice system and police. Şık is co-author of a book about the investigations and trials in the Ergenekon case - after the alleged name given to their organization by the conspirators. He had been working on a book about the police. Şener had written a book on the murder of Hrant Dink, a renowned journalist and human rights defender, and its investigation.