(part 2 of 4)
January 22, 2012 archive
Jan 22 2012
Cartnoon
Jan 22 2012
A New Head For The World Bank
Cross posted from The Stars Hollow Gazette
If there could possibly be a worse choice to head the World Bank when Robert Zoellick’s term expires later this year, I am sure that President Obama would find him or her. The rumors are that the president has decided to leave his “mark” on that banking institution by nominating Larry Summers for the position. Yes, that Larry Summers of the Harvard president of misogyny fame who was chief architect of banking deregulation that led to the repeal of Glass – Stiegel during the Clinton, that begat our current financial crisis. The Larry Summers who dismissed out of hand the suggestion that a bigger stimulus package would do more to boost the economy most likely because it was a woman, Christine Roemer, who proposed it.
And one of the biggest reasons why Larry could be one of the worst choices, as Felix Salmon explains, besides the fact Larry lacks the skills, he isn’t a diplomat:
The only way to be an effective World Bank president is to be an effective diplomat. Like all CEOs, the head of the Bank reports to a board of directors – but at the World Bank, the board of directors meets twice a week. And they’re not friendly hand-picked board members, either – they’re political appointees who fight their geographical corners, who live full-time in Washington, and who work full-time out of offices within the Bank itself. If you want to get anything done at the Bank, you need to persuade the board to leave you alone and not micromanage every decision you make.
You also need to be an almost superhuman manager. The World Bank has more than 10,000 employees from over 160 countries, with offices in more than 100 countries around the world. The range of cultural expectations they bring to their jobs is truly enormous, and the amount of political jostling and mutual incomprehension which results is entirely predictable. In order to manage this rabble, you need a very high level of cultural and interpersonal sensitivity.
And then there’s leadership: “the vision thing”, as Geoge HW Bush would put it, and the ability to get your organization to line up behind how you think the Bank – and, for that matter, the World – should work. Summers is not known for his work on global poverty reduction, and his previous tenure at the World Bank is remembered mainly for the pollution memo – an “ironic” proposal to increase pollution in poor countries, which resulted in the label “perfectly logical but totally insane” being attached to Summers for many years thereafter.
If Obama wants to leave his mark on the World Bank, this will definitely do it but not the way he’d like.
Jan 22 2012
Greek Default Appears Inevitable
Cross posted from The Stars Hollow Gazette
On Wednesday it was reported that some greedy hedge funds are blocking the rescue of the Greek economy. The hedge funds which had bought up the distressed Greek bonds in hope of making a killing came up against the Greek agreement to reduce their debt in order to receive the next tranche of funds to stave off default:
{..} (F)ears have grown in recent weeks that the hedge funds that are blocking the deal – which have been identified as including Vega Asset Management, Och Ziff, York Capital, GreyLock Asset Management and Marathon Asset Management – do not consider the prospect of a disorderly default by Athens as a financial incentive to allow a voluntary writedown deal to proceed.
This is because these funds are believed to have purchased insurance policies on their holdings of Greek bonds, known as Credit Default Swaps (CDS). If Athens fails to pay its maturing debts in March, that would trigger large CDS payouts to these funds from the large financial firms that sold them the insurance.
There is a reason they are called hedge funds but this is more a game of “head I win, tales you lose.”
To ad insult to injury, when Greek Prime Minister Lucas Papademos told the hold out that he would ask Parliament to change the law and force them to take the interest rate cut, the greedy hedgers have come up with plan to sue the Greek government in Human Rights Court forcing them to make good on the payment:
The novel approach would have the funds arguing in the European Court of Human Rights that Greece had violated bondholder rights, though that could be a multiyear project with no guarantee of a payoff. And it would not be likely to produce sympathy for these funds, which many blame for the lack of progress so far in the negotiations over restructuring Greece’s debts.
The tactic has emerged in conversations with lawyers and hedge funds as it became clear that Greece was considering passing legislation to force all private bondholders to take losses, while exempting the European Central Bank, which is the largest institutional holder of Greek bonds with 50 billion euros or so.
Legal experts suggest that the investors may have a case because if Greece changes the terms of its bonds so that investors receive less than they are owed, that could be viewed as a property rights violation – and in Europe, property rights are human rights.
As David Dayen at FDL News Desk points out this process could take years to litigate but he also found something significant buried in the New York Times article:
It is not just the legal cudgel that investors are threatening to use. Some hedge funds have discussed among themselves the possibility of demanding a side payment, as they describe it, as a price Europe and Greece must pay if the two want the funds to participate in the agreement.
Yes, David, I agree this is extortion..Give us the money or we blow up the world.
Jan 22 2012
On This Day In History January 22
Cross posted from The Stars Hollow Gazette
This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.
Find the past “On This Day in History” here.
January 22 is the 22nd day of the year in the Gregorian calendar. There are 343 days remaining until the end of the year (344 in leap years).
On this day in 1968, the NBC-TV show, “Rowan & Martin’s Laugh-In”, debuted “from beautiful downtown Burbank” on this night. The weekly show, produced by George Schlatter and Ed Friendly, then Paul Keyes, used 260 pages of jokes in each hour-long episode. The first 14 shows earned “Laugh-In” (as it was commonly called) 4 Emmys. And “you bet your bippy”, Nielsen rated it #1 for two seasons. Thanks to an ever-changing cast of regulars including the likes of Dan Rowan, Dick Martin, Arte Johnson, Goldie Hawn, Ruth Buzzi, JoAnne Worley, Gary Owens, Alan Sues, Henry Gibson, Lily Tomlin, Richard Dawson, Judy Carne, President Richard Nixon (“Go ahead, sock it to me!”), the show became the highest-rated comedy series in TV history.
Rowan & Martin’s Laugh-In ran for 140 episodes from January 22, 1968, to May 14, 1973. It was hosted by comedians Dan Rowan and Dick Martin and was broadcast over NBC. It originally aired as a one-time special on September 9, 1967 and was such a success that it was brought back as a series, replacing The Man from U.N.C.L.E. on Mondays at 8 pm (EST).
The title, Laugh-In, came out of events of the 1960s hippie culture, such as “love-ins” or “be-ins.” These were terms that were, in turn, derived from “sit-ins”, common in protests associated with civil rights and anti-war demonstrations of the time.
The show was characterized by a rapid-fire series of gags and sketches, many of which conveyed sexual innuendo or were politically charged. The co-hosts continued the exasperated straight man (Rowan) and “dumb” guy (Martin) act which they had established as nightclub comics. This was a continuation of the “dumb Dora” acts of vaudeville, best popularized by Burns and Allen. Rowan and Martin had a similar tag line, “Say goodnight, Dick”.
Laugh-In had its roots in the humor of vaudeville and burlesque, but its most direct influences were from the comedy of Olsen and Johnson (specifically, their free-form Broadway revue Hellzapoppin’), the innovative television works of Ernie Kovacs, and the topical satire of That Was The Week That Was.
Jan 22 2012
Six In The Morning
Gingrich wins South Carolina primary
Former US house speaker raises the possibility of a lengthy campaign by beating the Republicans’ favourite, Romney.
Last Modified: 22 Jan 2012 07:30
Gingrich, the former speaker of the House of Representatives, took roughly 40 per cent of the vote. His victory means that three different candidates have won the first three contests in the state-by-state Republican primary, reflecting a party electorate that has yet to make up its mind.
Rick Santorum, a former senator from Pennsylvania, won the Iowa caucuses on January 3, and Romney, the former governor of Massachusetts, won the New Hampshire primary on January 10.
Speaking at a late-night victory rally in Greenville on Saturday, Gingrich complimented his rivals before laying into Obama, whom he called a “radical” who would transform the United States into a European-style socialist state.
