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1. The Democratic convention . Barack Obama's pitch to the centre

PERHAPS because there are so few of them, campaign strategists for both Barack Obama and Mitt Romney can describe the undecided voters who will help determine the outcome of this year's election with remarkableprecision. On Thursday evening in Charlotte, North Carolina, on the last night of the Democratic convention,Mr Obama made his case for re-election directly to those elusive swing voters.Who are they? At Mr Romney'scampaign headquarters in Boston recently, senior aides told your correspondent that their target swing voter was a married, middle-class, middle-aged woman who voted for Mr Obama in 2008. Inspired by his promisesand swept up in the excitement of electing America’s first black president, such voters now feel deeply 

disappointed by the president’s actual record, it was asserted. In Tampa last week, Republicans predicted thatthe president, unable to run on his record, would have to mount a negative campaign and seek to suppress MrRomney’s vote, paving the way for a grim, ground-out victory on the backs of the various special-interestgroups that make up the Democratic base.Strikingly (and to his credit), the president made a more centrist,positive pitch in his acceptance speech. There were some clever swipes at the Republicans, but Mr Obama alsotouted his own record and told those who had backed him in 2008 that it was their record, too, seeking toanchor them in his camp. The disappointment question (all that hope and change) was deftly handled. Therelationship between Mr Obama and his supporters had matured, you see, from a passionate affair tosomething more significant.It was a risky approach that appears cold in print. Mr Obama told the crowd inCharlotte, "[T]imes have changed—and so have I. I’m no longer just a candidate. I’m the president.” But whendelivered, the line was one of the most popular of the night. Staring deep into undecided America’s eyes, thepresident explained:

“So you see, the election four years ago wasn’t about me. It was about you. My fellow citizens—you were thechange… If you turn away now—if you buy into the cynicism that the change we fought for isn’t possible…well, change will not happen.” 

It takes some brass, as Bill Clinton would say, to run on a platform of change when you are the incumbent. Butany incumbent holding office in times of gloom faces a double headache. First, they must argue that thecurrent mess is not their fault. Second, they must explain why their clever ideas for fixing the mess have not yet been tried. On these counts, Mr Obama was only partly convincing.The speech began horribly. Mr Obamalaunched what was, in effect, a synthetic proxy attack on globalisation. But after this leftish pandering thepresident tacked to the centre, and more or less stayed there for the rest of the speech. He talked of increasingenergy exploration and extraction, especially of fracked natural gas, but also of subsidising renewable energy 

production and enforcing environmental rules covering things like offshore drilling. He vowed to preserve America's military pre-eminence, while accusing Mr Romney of planning to increase defence spending beyondthe levels sought by the service chiefs (it’s a bit more complicated than that, but it is true that Mr Romney’sdefence spending plans are unserious). He denounced tax breaks for companies that send jobs overseas, butdefended free trade.The smartest bit of the speech dealt with the slightly cartoonish argument about the role of government that has dominated both party conventions over the past fortnight. The Republicans calledgovernment a menace that should simply “get out of the lives” of hard-working businessmen and ruggedly individual entrepreneurs. The Democrats, on the other hand, seemed to suggest that government benevolence was a more reliable protector of the rights of the little man than the profit motive. It is not either/or, MrObama argued. That this simple observation represented a marked raising of the rhetorical tone is a measureof how shrill the debate has become. His words amounted to a rebuke of angry partisans in both parties:

“We don’t think government can solve all our problems. But we don’t think that government is the source of all our problems—any more than are welfare recipients, or corporations, or unions, or immigrants, or gays,or any other group we’re told to blame for our troubles.” 

The reception for all this in Charlotte was enthusiastic, even if Bill Clinton inspired more affection with his bravura performance on Wednesday night.The magic of 2008 is gone forever. But Mr Obama, greyer andgrimmer than he was four years ago, does not need magic to win re-election. In a sharply divided country in which perhaps 40% of voters on each side are camped in entrenched positions, he needs to keep up turnout onhis own side, and hold onto enough centrists to make it across the victory line. Mr Obama's convention speech was not the most exciting or convincing he has ever delivered. But it was not a bad pitch for the sort of winningcoalition he will need.

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2. The ECB and the euro. Too central a banker?

 WHEN European leaders declare that they will do whatever is necessary to protect the euro zone, most people just yawn. But when Mario Draghi, president of the European Central Bank, said the same in July, everybody took notice.This week plaudits (and some protests) have been showered on Mr Draghi after he confirmed onSeptember 6th (over the explicit objections of Germany's Bundesbank) that the ECB would resume buying the bonds of troubled countries—on strict condition that stricken countries submit to formal, externally monitored

reform programmes. Often in the crisis the ECB has appeared to be the only thing standing between the euroand the abyss. This has brought it ever greater influence. The proposed new banking supervisor for the eurozone will be an offshoot of the ECB (see my column this week, Eurobankingfragilistic). Moreover, the ECB'sofficials are part of the troika that monitors and enforces countries' compliance with their bail-out conditions. And when it comes to the future of the euro zone, Mr Draghi has become the most explicit of the “fourpresidents” (of the ECB, the European Council, the European Commission and the Eurogroup of financeministers) who are drafting a “road map” for future integration. All this raises a question: is the ECB becomingtoo powerful? Is it straying too far from a central banks’ role of setting interest rates and controlling inflation?Is it becoming too overtly political?Figures close to the ECB argue that, at a time when Europe is confrontingits greatest economic crisis since the second world war, European institutions must respond with the imperfectmeans at their disposal. The European Union, or even the euro zone, is not a federal state. So it is up to themost integrated parts of it to show leadership.That the ECB should take such a central role is in many ways areflection of the failure of the euro-zone’s political leaders to bring the debt crisis under control in more thantwo years of emergency summits and bail-outs. There reasons are many: publics are reluctant to give upsovereignty and share risks to the degree needed to stabilise the currency; parliaments are reluctant to give outtaxpayers' money; debtor states are resistant to demands for ever more austerity. None of Europe’s leadersexcept Germany's chancellor, Angela Merkel—and probably not even her—can resolve the crisis alone. Yetevery leader can place obstacles in the way of solutions. So progress, when it takes place, is measured inhaphazard half-steps, which never quite satisfies investors who want certainty.Mr Draghi is in an entirely different position. Whereas politicians must raise money from taxpayers, the ECB can in theory printunlimited quantities of the stuff. As an independent central banker he is accountable to no government orparliament—only to other unelected central bankers in the ECB's governing council. The only real obstacle isthe Bundesbank's chief, Jens Weidmann. But in a body where Germany has the same vote as Greece, Mr Weidmann can easily be outvoted—as he was this week. Despite his denunciation of the bond-buying plan, Mr Weidmann shows no sign of resigning in protest.Mr Draghi is supposed to rise above base politics, yet he takespart in every European summit. His public pronouncements are studied like Greek oracles. The high priest of Europeanism does not officially negotiate with leaders. But Like Jean-Claude Trichet before him, he sendsmessages to political leaders from the top of the Eurotower in Frankfurt, listens for a response and thenpronounces.Last December Mr Draghi spoke vaguely of the need for a “fiscal compact” and, lo, leaders agreed

to a new treaty enshrining balanced-budget rules. Mr Draghi then sprayed the banks with €1 trillion worth of cheap money.Now Mr Draghi is setting conditions more explicitly. Forget “light” forms of conditionality. TheECB said it would resume its dormant bond-buying programme only if two conditions were met. First,countries needing help must ask for it and submit to a fully-fledged programme agreed and monitored by European institutions (and preferably by the IMF too). Second, the rescue funds should start buying bonds inthe primary market. This could be done by the temporary European Financial Stability Facility, or the new improved European Stability Mechanism that should soon enter into force, pending a ruling by Germany'sconstitutional court on September 12th.In the past, the ECB’s conditions would be spelled out in secret letters,for instance when the ECB started buying Italian bonds last year (see my earlier blog post here). Now the ECB wants the conditions to be made explicit by governments. Bond-buying would end when the (unspecified)

objective had been achieved, says Mr Draghi, or if the country in question breached the terms of its reformprogramme.Mr Draghi, then, is not going to stand in the front line wielding the ECB's big bazooka. But if others man the trenches, he will provide artillery support from the rear to avert a catastrophe. Mr Draghihimself uses a different image: the response to the crisis has to stand on “two legs”. ECB action withoutreforms would be ineffective. But he also acknowledges that reforms by governments are taking too long to

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 bear fruit and need to be supported by the ECB.Mr Draghi justifies his action with the argument that high yields faced by southern European governments are not only the product of a higher credit risk, but also theresult of markets' “unfounded” fear that the euro would break up. The former is a matter for governments, butthe risk of currency redenomination is the ECB's business because it impedes “the transmission of monetary policy”. It is an appealing argument, but hard to put a number on the extra interest countries are paying because of the convertibility risk.Nevertheless, Mr Draghi insists the euro is irreversible. The ECB'sintervention in the market is aimed at removing the “tail risk” of a break-up. At his press conference a journalist cheekily asked why it was Mr Draghi's job to ensure the euro’s irreversibility. By what authority could he decide what currency countries should use? Mr Draghi offered no real answer.Even if one accepts thepremise that saving the euro is part of the ECB's mandate, Mr Draghi is straying into awkward territory. TheECB's independent action has been made dependent on fickle politicians. At least indirectly, Mr Draghi will be bargaining with governments over the terms of their reform programme.To the irritation of the ECB andBrussels institutions, the Spanish prime minister, Mariano Rajoy, has prevaricated for weeks over whether toseek more assistance, declaring he would wait to see the ECB's terms before deciding whether to ask for help. What if Mr Rajoy takes the money but is later deemed to have missed its targets for reform? If Mr Draghi really cuts off a country like Spain, he would surely be calling into question the future of the euro after all.There areother worries. Next week the European Commission will propose placing all of the euro zone's 6,000-odd

 banks under an ECB-directed central supervisor. Many worry that, despite the attempt to place a Chinese wall between the supervisory and monetary roles, the ECB's hallowed independence will become compromised by taking on the huge new task. Can the ECB really separate its decisions on inflation-fighting from its growingrole in ensuring financial stability? Perhaps more importantly, would the ECB’s reputation for competencesurvive a major failure of supervision?Then there is the question of how to fix the design flaws of the euro zone. An article  written by Mr Draghi last month for the German daily, Die Zeit, caused much excitement becausethe mention of “exceptional measures” seemed to confirm that the bond-buying programme would berestarted.In fact, most of the piece set out Mr Draghi’s vision for the economic and political integration of theeuro zone. It is not just the currency that should be irreversible, he said, but also the whole “historic process of European unification”. In his view, stabilising the euro would require political integration that stops short of a

full federation.

...this new architecture does not require a political union first. It is clear that monetary union does entail a

higher degree of joint decision-making. But economic integration and political integration can develop in

 parallel. Where necessary, sovereignty in selected economic policy fields can and should be pooled and 

democratic legitimation deepened.How far should this go? We do not need a centralisation of all economic

 policies. Instead, we can answer this question pragmatically: by calmly asking ourselves which are the

minimum requirements to complete economic and monetary union. And in doing so, we will find that all the

necessary measures are firmly within our reach. For fiscal policies, we need true oversight over national 

budgets. The consequences of misguided fiscal policies in a monetary union are too severe to remain self-

 policed. For broader economic policies, we need to guarantee competitiveness. Countries must be able togenerate sustainable growth and high employment without excessive imbalances. The euro area is not a

nation-state where persistent cross-regional subsidies have sufficient popular support. Therefore, we cannot 

afford a situation where some regions run permanently large deficits vis-à-vis others. For financial policies,

there need to be powers at the centre to limit excessive risk-taking by banks and regulatory capture by

supervisors. This is the best way to protect euro area taxpayers. There also needs to be a framework for

bank resolution that safeguards public finances, as we see in other federations. In the U.S., for example, on

average about 90, mostly smaller, banks per year have been resolved since 2008 and this had no impact on

the solvency of the sovereign. Political union can, and shall, develop hand-in-hand with fiscal, economic and 

 financial union. The sharing of powers and of accountability can move in parallel. We should not forget that 

60 years of European integration have already created a significant degree of political union. Decisions aremade by an EU Council filled by national ministers and by a directly elected European Parliament. The

challenge is to further increase the legitimacy of these bodies commensurate with increasing their

responsibilities and to seek ways to better anchor European processes at the national level...

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It is hard to imagine any other central banker setting out such a detailed political blueprint for economic andconstitutional reform. Then again, the ECB is no ordinary central bank and these are no ordinary times. In acrisis it may make sense for a trusted figure to offer direction, even to take risks. But it is not a role that anunelected central banker can play for too long.

3. Charlemagne. High gloom. Don’t expect the European Central Bank single-handedly to save the euro

SOMEBODY must have put on the wrong film. In late July Mario Draghi, president of the European CentralBank, came out looking like a tough sheriff ready to take on bond-market speculators while others cringed. Theeuro was irreversible, he declared. “The ECB is ready to do whatever it takes to preserve the euro. And believeme, it will be enough.”Yet instead of a great shoot-out, Mr Draghi later said he was mulling only a limitedholding action. And now he has ducked out of sight, cancelling his appearance in cowboy country this weekendat the annual get-together of central bankers in Jackson Hole, Wyoming. Gary Cooper would never have criedoff because of his “heavy workload”.With the power to create money, Mr Draghi owns the biggest gun of all.Merely the hint that he is prepared to use it to buy bonds has had a reassuring effect, averting any panic overthe summer. Investors are now waiting to see what he will do when the ECB’s governing council meets on

September 6th. Perhaps Super-Mario needs time to saddle up. But there is a more worrying possibility: thatMr Draghi is slugging it out with deputies trying to keep the gun-closet locked. Jens Weidmann, president of Germany’s Bundesbank, says intervening in the bond market comes dangerously close to breaking the law that bans the ECB from financing states. Governments created the crisis, and governments should resolve it, arguesMr Weidmann. If they become reliant on the ECB’s power, they will never do anything for themselves: ECBmoney, he suggests, “can become addictive like a drug.”Mr Weidmann’s challenge is polarising views inGermany. Many worry that the euro will turn into a soft currency area with high inflation—rather like MrDraghi’s native Italy in the days of the lira. Alexander Dobrindt, general secretary of Bavaria’s Christian SocialUnion, part of Germany’s ruling coalition, says the ECB risks becoming “the currency forger of Europe”.To agreater extent than outsiders might think, Mr Draghi shares Mr Weidmann’s concerns. The word from

Frankfurt is that, because he has run Italy’s treasury and its central bank, Mr Draghi knows more than mosthow monetary financing of deficits can lead to high inflation. He also knows that past bond-buying by the ECBhad no lasting impact and loaded the ECB with dubious bonds. But to him this means that the weapon should be used with care, not banned entirely. In early August Mr Draghi said the ECB was prepared to resume bond- buying under strict conditions. First, countries seeking help should make a formal request to the temporary European Financial Stability Facility or the (planned) permanent European Stability Mechanism. Second, they should commit to reforms. And third, the rescue funds should buy long-dated bonds in the primary market to bring down borrowing costs.Only then, if needed, might the ECB deploy its fire-power to buy short-dated debtin the secondary market. Action at the short end, Mr Draghi argued, was closer to conventional monetary policy. This is a narrower front than the one chosen by his predecessor, Jean-Claude Trichet, but Mr Draghi

thinks he can deliver more fire-power. He said the scale of intervention would be “adequate”. And he alsopromised to address investors’ fears that ECB purchases would have the effect of subordinating private bondholders. He can surely get his way: mighty Germany wields the same voting power in the ECB as tiny Malta.The real question is the extent to which Mr Weidmann has the support of the German government.There is talk of Berlin’s irritation with the Bundesbank’s fundamentalism. Tellingly, the other German on theECB council, Jörg Asmussen, endorses Mr Draghi’s view that the ECB should intervene to assuage fears thatthe euro will break up. The drama is heightened by the fact that Mr Weidmann was until last year AngelaMerkel’s loyal economic adviser. Yet even if the chancellor sees him as her turbulent Thomas Becket, she iscareful not to seem to want rid of him. Mrs Merkel may well tacitly support Mr Draghi. After all, say seniorEurocrats, it is easier to get the ECB to prop up countries than to ask the Bundestag for more bail-out money or

Eurobonds.Indeed, many see the ECB as the euro’s ultimate saviour. It has the independence and means to actdecisively. As a guardian of the euro it sees the European interest better than national politicians and central banks. And it has a strong incentive to act: without the euro there would be no ECB. But this is too simple a view. The ECB must always perform a balancing act: between its power to print money and its unusually narrow legal mandate; between its independence and the need to maintain political consent.By placing

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governments in the front line, Mr Draghi seeks to avoid moral hazard of two sorts. One is the risk that debtors will abandon reforms as soon as market pressure is relaxed, as happened with Italy under Silvio Berlusconi lastsummer. Instead of writing secret letters, the ECB wants other European bodies overtly to enforce fiscal andstructural reforms. The other, unspoken, danger is that without a fear of the euro’s collapse, creditors will shirk action to solidify the euro through greater economic, financial, fiscal and political integration and risk-sharing.The euro’s crisis is fundamentally political, not monetary or financial. The ECB cannot fix the euro; itcan only buy time. In many ways Mr Weidmann is right to say that, if there is to be mutualisation of risk itshould not be done through the back door of the ECB, but rather through the front door (eg, with Eurobonds)and with the agreement of national parliaments. Some in the ECB think that the crisis will have to worsen before politicians take such radical action. Either because he cannot, or because he does not want to, MrDraghi will not be the lone ranger.

4. The euro zone crisis. The ECB and OMT: OTT, OMG or WTF?

THE markets reacted with euphoria to the European Central Bank's new outright monetary transactionsprogramme or OMT, the latest acronym to mark this crisis (remember all was supposed to be solved by the

SMP, EFSF and ESM programmes?) .But we have seen in the past that the market reaction can quickly reverse. And the programme raises a number of questions.

1. Everyone knows that the Germans are the paymasters of Europe, and yet the Bundesbank opposed theprogramme. How credible can the ECB be in the long run if it is consistently opposed by the Bundesbank, the bank it was set up to replicate?

2. As my colleague notes, the key question will be whether the Spanish and the Italians are willing to ask forhelp, on the condition of austerity programmes. Unless they ask, the OMT won't kick in. But if the ECB'spromise drives down yields in the short term, then the governments will be less inclined to ask for help. This

might sound ideal, unless the Bundesbank is right and the ECB promise means the governments will simply postpone reform.

3. But let us suppose that governments do apply for the package and impose austerity. On the basis of theGreek experience that will mean prolonged recessions, and a weak euro-zone economy. In turn, that will leadto resentment against the ECB. How stable can this situation be, or will voters turn, as the Greeks almost did,to rejectionist parties?

4. The programme will be unlimited but also sterilised which means, according to JP Morgan that

The way the ECB has chosen to sterilize these reserves balances is to encourage banks to shift them from the fully liquid current accounts into fixed term deposits, which are just another form of reserves. The ECB could 

offer these at any maturity but has chosen a short maturity of just one week (likely for operational reasons).

The deposits are auctioned through a tender procedure, which requires banks to put in bids, stating the

amount they are willing to tie down for the one week period and the interest rate at which they are willing to

do so

Now it is likely that banks have an unlimited appetite for holding money at the ECB so this won't be a problem.But it does mean that we have a pyramid-style system, in which banks are huge lenders to the ECB which inturn is a big buyer of the debt of governments which in turn are the backstop for the banks. It looks rather likethe balance sheet of the Robert Maxwell empire.

5. The ECB will buy debt of short-term maturity, three years or less. The temptation will be for governments toissue debt in that range, since the cost will be cheaper. So the debt of those governments will gradually becomemore short-term. Say the debt-to-GDP ratio is 100% and the average maturity is three years; 33% of GDP

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needs to be refinanced every year. that's a lot and the country starts to look like a struggling business, livinghand-to-mouth. Will the ECB actually be able to extricate itself from this programme? (The same questionapplies to the Bank of England and the Fed, of course)

6. And that also takes us back to moral hazard. In theory, the ECB will stop its bond-buying if governments veer off the agreed programme. But is that threat credible? After all, the ECB seems to have changed tack many times in order to stave off a euro crisis. If the euro is "irreversible" and if a cessation of ECB bond-buyingthreatened its existence, wouldn't the ECB blink again?

5. German reactions to Mario Draghi's bond buying plan. Visionary or self-appointeddespot?

MARIO DRAGHI, president of the European Central Bank, should probably not open the German papers thismorning. Nearly all of them are highly critical of the ECB’s plan, unveiled on September 6 th, to start a processof buying the government bonds of peripheral euro-zone states, as long as they have subjected themselves to

some kind of politically-approved rescue programme.

“A black day for the euro, and for all of us,” thunders  Bild , Germany’s biggest-circulation daily. “The ECB isstanding the euro rescue on its head—those who need rescuing are calling the shots…. No, Mr Draghi, this ishow to make the euro sick, not healthy.”

“The good news,” says Munich’s  Süddeutsche Zeitung, “is that the floodgates have not been openedcompletely,” since the bond programme is conditional. The bad news is that by calling the euro “irreversible”Mr Draghi is proposing a euro rescue at any price: “that crosses a red line.” A euro based on a breach of theEuropean Treaty is on shaky ground, says the paper. “It is unacceptable for the ECB to appoint itself the secret,

or rather not-so-secret, ruler over Europe.”The  Frankfurter Allgemeine Zeitung says that so long as the ECB willingly assumes the role of sweeper, to make up for the political failure of those who should be rescuing theeuro, it will be unable able to exit from the bond purchase programme. “There is no borderline any more between monetary and fiscal policy.”Another daily,  Handelsblatt , takes Mr Draghi to task for saying that theECB has given the governments a framework and set them a “parcours” as if they were circus ponies. “Is thatappropriate language for an unelected official?”But  Handelsblatt  does reckon that the ECB’s announcementhas taken some of the tension out of an eagerly awaited decision next week. On September 12 th, Germany’sconstitutional court, is expected to pronounce on the legitimacy of the proposed €700 billion EuropeanStability Mechanism (ESM). “If the ESM doesn’t fly,” says  Handelsblatt , “then at least the ECB’s bondprogramme will.”If Mr Draghi opens any German newspaper at all, then it should be the daily   Berliner

 Zeitung, or its sister publication, the  Frankfurter Rundschau. Economics editor Robert von Heusinger, everthe contrarian, lavishes praise on Mr Draghi and his vision. “September 6 th 2012 should go down in the annalsof the United States of Europe,” he begins. “Without the courage and vision of Mario Draghi the days of theeuro would be numbered and with them those of a unified Europe.”Mr Heusinger compares Mr Draghi’s boldstep with that of Alexander Hamilton in 1790, when he mutualised the debt of America’s disorderly rabble of states despite the absence of a political union.“The ECB has the unbelievable advantage that it can literally print the money that it has committed to the unlimited purchase of bonds. In that way it can stand up to any speculative attack and win.” Mr Heusinger rebuffs the three main objections raised in Germany to Mr Draghi bold plan: that it will lead to inflation; that it lies outside the ECB’s mandate; and that there is no quid pro quo. All wrong, says Mr Heusinger.But there is a noisy current of opinion in Germany that suggests the ECB will get

a rough ride in the next few weeks. The endemic fear of inflation, stoked by 20 th century experiences, cannot be banished by simple promises that the ECB will soak up the billions of euros that it is creating. Mr Draghi may have bought some time, but in less than a week Germany’s constitutional court could put the markets in a tizzy again.

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6. Monetary policy. On gold and golden ages

 APPARENTLY, while I was out on paternity leave, the Republican Party flirted with adding a return to a goldstandard to its official platform, thereby touching off an online debate on the merits of such a standard.Belatedly, I'd like to offer a few thoughts.First, this is a solution in search of a problem. One big reason to tiemoney to a commodity standard would be to limit its growth in order to protect against runaway inflation. But we have learned that in most situations central banks are more than capable of controlling inflation on their

own, and markets show no sign of a fear of looming high inflation. What's more, history demonstrates that when push really comes to shove governments will just jettison the commodity standard and print money asnecessary.Alternatively, a gold standard can make up a key part of a fixed-exchange-rate regime, as it did in theclassical gold era that persisted from the 1870s through 1914. An important question, however, is just why one would want a fixed-exchange-rate regime. In the absence of strong international cooperation, such systemstend to break down quickly. When they don't break down, they can prove disastrous, as the interwar goldstandard and the euro area demonstrate. And floating exchange rates actually seem to work just fine—better,many argue, than fixed rates.But perhaps there's something else special about a gold standard. My colleaguepoints out that the era of the classical gold standard was one of the brightest of the modern economic era. AndTyler Cowen writes:

 Dare anyone critical of the gold standard bring themselves to utter these (roughly true) words?: “For the

Western world, the gold standard era, defined say as 1815-1913, was arguably the greatest period of human

advance ever, at least in matters of economics, culture, and technology.” Chunks of the post-WWII era

contend for this designation, but still this sentence is not a crazy one.

Several points. First, there is plenty of room within a brilliant century for a handful of economic disasters.There is no question that this period had its share of macroeconomic troubles, and that the gold standard alsoexacted signficant distributional costs that shouldn't be ignored. Not for nothing did William Jennings Bryanhave a following. Moreover, this period is merely an entry in the ledger, on the other side of which must sit aninterwar period strongly shaped by the commitment to gold. If you want to credit gold with a key role in the

creation of the modern economy you must also admit that it very nearly destroyed it.Second, the goldconstraint functions differently under different economic circumstances. Gold defenders like to point out thatdeflation was common in the 19th century, yet no Depression resulted. That's not quite right; there were somenasty business cycle swings in the 19th century. Perhaps more important, deflation was often the result of extremely rapid growth in economic potential. It was an era more like the American economy of the late 1990sthan the American economy of the 1930s or the Japanese economy of the late 1990s. If a supply surge leads tofalling prices, gold-standard monetary policy is less likely to be destructive. If falling prices are due tocollapsing demand , however, the gold constraint on reflation may prove deadly. An enormous risk of a goldstandard is that the economy might fall into a low-demand trap. Of course, that also seems to be a risk of certain inflation targeting regimes.But here's one last thing to consider. The classical gold era was above all an

age of inflation volatility. Prices could tumble if growth surged or they could soar with the discovery of new gold. Inflation volatility is costly; it forces firms to change prices often, and individuals must constantly think in real terms. That's not how things work today, for the most part. Given low and stable inflation, the price isthe price is the price. That's convenient when making everyday purchase decisions, and it also means thatfirms and workers feel much more comfortable agreeing long contracts or setting prices infrequently.Theflipside of that comfort, however, is a much less price-flexible economy. Or, as Larry Ball, Greg Mankiw, andDavid Romer put it in a 1988 paper:

 [T]he real effects of nominal shocks are smaller when average inflation is higher. Higher average inflation

erodes the frictions that cause nonneutralities, for example by causing more frequent wage and price

adjustments.

So perhaps there was something useful about gold after all. Of course, there is a way to preserve a healthy levelof inflation volatility while also avoiding dangerous collapses in demand: nominal GDP targeting. We can do

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 better than gold—much better—by simply observing that the gold standard functioned best when mimickinggood monetary policy, defined as demand stabilisation, and by working to stick to that.

7. One-firm economies. The Nokia effect. Finland’s fortunes are affected by one firm. What

about other countries?

NOKIA contributed a quarter of Finnish growth from 1998 to 2007, according to figures from the Research

Institute of the Finnish Economy (ETLA). Over the same period, the mobile-phone manufacturer’s spendingon research and development made up 30% of the country’s total, and it generated nearly a fifth of Finland’sexports. In the decade to 2007, Nokia was sometimes paying as much as 23% of all Finnish corporation tax. No wonder that a decline in its fortunes—Nokia’s share price has fallen by 90% since 2007, thanks partly to Apple’s ascent—has clouded Finland’s outlook.Are any other economies so reliant on one company? Theresearchers at ETLA calculate Nokia’s value-added to work out its importance to Finland, but such data are not widely available. A look at firms’ sales as a percentage of GDP (see table) offers a cruder indication of clout. Weused the Dow Jones Global Index to identify firms whose revenues ranked highest in the country of theirlisting.Firms like ArcelorMittal, Essar Energy and China Mobile make the top ten because of their choice of domicile; their economic activity mainly takes place elsewhere. Oil-and-gas firms feature heavily, although thatmay simply show that certain economies are dependent on a certain type of activity rather than a specific firm.Lower down the list the presence of Sands China, a casino developer and operator whose sales are 13% of Macao’s GDP, reflects the importance of gambling to the territory.Strip these sorts of firms from the list andonly one resembles Nokia: Taiwan’s Hon Hai, an electronics manufacturer. Yet Nokia made 27% of Finnishpatent applications last year; the corresponding figure for Hon Hai was 8%. Although numbers are falling,Finland is home to the greatest number of Nokia employees; Hon Hai’s staff is mostly in China. It is a similarstory with other firms. Sales of Nestlé, a consumer-goods company, weigh in at 15% of Swiss GDP but its shareof Swiss jobs is punier than Nokia’s in Finland. Samsung, whose revenues are twice Nokia’s, has half its cloutas a share of GDP: South Korea’s economy is more diversified. The importance of Nokia to Finland looks like aone-off.

8. China’s capital controls. Set the money free. But China should liberalise finance athome before unleashing capital flows across borders

CHEAP capital has been crucial to China's rise. The country's growth has been fuelled by banks sucking upplentiful household savings and pumping them into not-always-deserving industry, including big, state-owned borrowers.There are costs to this approach. The skewed interest rates offered by China's banks represent a taxon depositors and a subsidy for industry. They distort the economy, suppressing consumption, services andprivate business in favour of investment, industry and the state. Savers seeking to avoid being fleeced by thecountry's banks inflate housing bubbles instead. And controls on capital outflows prevent sound investmentsabroad, resulting in large and dangerous piles of foreign-currency reserves.Ultimately, putting this rightrequires China to accept freer movement of capital within its borders, and across them. Yet opening a financialsystem to the outside world carries dramatic risks—witness the tide of hot money into China's neighbours thatled to the Asian financial crisis at the end of the 1990s. How, then, should China chart a safe course?OneChinese organisation, at least, has been thinking about just that. The relatively liberal People's Bank of China(PBOC) has just circulated a study that recommends opening up the financial system, with a ten-year timetablefor easing capital restrictions. It would start by encouraging Chinese businesses to buy foreign companies—many of which, the report points out, are going cheap right now. Next would come greater cross-bordercommercial lending, including loans in Chinese currency. After that, foreigners could invest more freely inChinese shares, bonds and property. Remaining controls could be lifted at the government's discretion, withsuitable curbs on “speculative” capital flows staying in place indefinitely.This makes sense—as far as it goes.China's excess saving is currently funnelled through the central bank into (overpriced) American Treasuriesand similar bonds. This appetite for safe securities encouraged Western banks to create synthetic, AAA assets

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that later turned toxic, with ruinous results. China's direct investments abroad, in firms and factories, amountto less than Sweden's. Looser controls would encourage more productive investments that are less likely tounbalance the world economy.China, unlike many emerging economies, does not need foreigners' money. Itsown people and firms save more than enough. Yet it could use a more cosmopolitan mix of capital. Foreigninvestors might help finance the parts of China's economy its banks do not reach, such as entrepreneurialcompanies. Their presence might also deepen and diversify China's skittish financial markets. And the yuan will not become a successful international currency—as China's leaders want—unless foreigners can use it to buy and sell Chinese assets.For all these reasons, the central bank seems keen for the government to get amove on. But it needs to get the timing right. If China eases capital controls at its border before easing those within the country, there could be a rush for the door as depositors in China's state-owned banks hurry to puttheir money in foreign bank accounts or stockmarkets. Unless domestic interest rates are liberalised first, togive savers a reason to keep their money in the Chinese banking system, China's financial system might fallapart.The rulers' inclination is to do nothing. Reform would be risky, and would carry political dangers for agovernment that fears losing control—especially to foreigners. Yet inaction also poses risks. China's leadersknow that the country needs to keep growing fast to remain politically stable. If it is to do that, capital needs to be more efficiently allocated.China can minimise the dangers of liberalisation by preparing the path. Thus any scheme to free up the capital account should also liberalise interest rates and the exchange rate, overhaul

monetary policy, improve the way Chinese banks are run and supervised, and foster deeper, better-regulatedfinancial markets. Domestic and international liberalisation can complement each other. Foreign competitioncan force Chinese banks to raise their game. The movement of capital in pursuit of the best returns alsoprevents domestic interest rates from getting too far out of line.At this stage of its development, China'sfinancial reforms will work best in tandem. But to prevent bubbles and crashes, capital-account liberalisersshould remain in the back seat while the domestic reformers keep pedalling.

9. China’s banks. Storing up trouble. Healthy profits are misleading

BANKS in China appear to be in rude health. The seven biggest mainland banks have just posted a 16% year-

on-year increase in pre-tax profits between them for the first quarter. The level of non-performing loans(NPLs) remains low, at just about 1%. But trouble is being stored up for the future.There are two big worries: bad local-government debt and souring property loans. The infrastructure binge of the past few years saw a boom in local-government financing vehicles (LGFVs), off-balance-sheet entities used to get aroundprohibitions on borrowing. Regulators say these entities' bank debts were worth $1.4 trillion at the end of September. Private estimates range much higher, and suggest that 20-30% may be non-performing.Thegovernment is trying to defuse the bomb. One experiment is the issuance of local bonds to replace these loans.Officials also published guidance in March pushing banks to roll loans over, in the hope that growth will solvethe problem. Another wheeze is shoving these loans onto the books of “policy banks” like China DevelopmentBank (CDB), whose balance-sheets are now suffering (see chart). Half a trillion yuan, around $80 billion, in

LGFV debt was rolled over last year from commercial banks to the CDB alone.The other headache is property, which is undergoing a government-forced cooling. Because real estate touches many parts of the economy,some worry that NPLs in this sector may be harder to isolate than local-government debt. Michael Werner of Sanford C. Bernstein, an investment bank, is relaxed, pointing to official figures claiming that 75% of property loans are collateralised, compared with only 38% of loans to manufacturers and 24% of those to utilities. Fine, but that reassures only if the collateral is good. It may not be.Charlene Chu of Fitch, a ratings agency, thinksofficial statistics have to be treated with care in any case. Several factors are masking the true level of NPLs, shereckons. One is the practice of rolling over bad debt; another is the ability of distressed borrowers to turn to a vibrant shadow-banking sector for loans when in trouble. Banks are also shifting lots of activities off their balance-sheets. By moving deposits from normal accounts to “wealth-management accounts”, for example,

 banks can reduce the ostensible deposit base against which they must hold reserves, but must also pay muchhigher interest rates.The Chinese banking system is already among the most thinly capitalised in emergingmarkets (the ratio of equity to assets is 6%). Ms Chu calculates that if a tenth of the banking system'soutstanding credit turns sour over the next two years, all profits and 39% of the system's equity will be wipedout. If NPLs are unreliable indicators, liquidity measures may be a better signal of brewing trouble. Pointing to

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a rise in market-based interest rates and slowing loan growth, she argues that a crunch has already started. The banks' figures do not immediately show it but the hangover from China's post-crisis credit boom may be under way.

10.China's economy. Is this the soft landing?

THERE has been a fair amount of anxiety over the state of the Chinese economy of late. News of unexpectedly large debt burdens among Chinese local governments generated a wave of concern that recent Chinese growthhas been entirely unsustainable. As the government was forced to turn off the credit tap, some supposed,property prices would fall and a hard landing would result.That seems an unlikely scenario to me. Chinese debt burdens are manageable and its property market dynamics are quite different from those that prevailed in western bubbles markets prior to the crash. That doesn't mean that all is entirely well in China, however. Many observers have taken some comfort in the latest GDP report from China. Output rose 9.5% year-on-year in thesecond quarter. That constitutes a moderate slowdown from growth in the previous quarter, and was a littleabove expectations. It would seem that the government's efforts to slow credit growth have not precipitated anuncontrollably rapid downturn in activity.Other economic data is a little more disconcerting, however. China's

trade surplus surged in June. Its exports to America have been  growing and its imports falling. At the sametime, Chinese inflation continues to rise; the latest reading is 6.4%. And accumulation of foreign-exchangereserves persisted in the second quarter, to the tune of $153 billion. Meanwhile, a closer look at the GDP reportindicated that the contribution of fixed-asset investment to growth tumbled in June, with industrial activity offsetting the fall. Retail sales of consumer goods have held at a constant growth level for most of the year.What does this tell us? China's leaders recognise the need to rein in the country's building boom, but they are likely concerned about the prospects for other sectors that might provide a cushion against a falling growthcontribution from construction. One hope was that a boom in affordable-housing construction might offsetdeclines in market-rate property development, but the affordable-housing effort continues to run into delays.The long-run hope is that household consumption begins to pick up and drive economic growth. But as

the GDP data indicate, China is struggling to mobilise its consumers. That therefore leaves the industrialexport channel to pick up the slack, and that, seemingly, is what's occuring. Too much emphasis is placed onthe yuan's peg to the dollar, but the relationship tells a useful story here. China allowed the yuan to beginappreciating against the dollar last June, but after a first tick upward it leveled off and even declined againstthe dollar through last summer. Why? China appeared to be troubled by the slowdown in global economicactivity. In the fall, when the data turned positive again, the yuan embarked once more on a steady appreciation.But the yuan has once again leveled off in recent months. And this pause in appreciation isparticularly curious given the problems China is having with inflation, which are being exacerbated by thereserve accumulation that accompanies its currency management. In short, now would seem to be a very goodtime to allow the yuan to rise a bit more. But the yuan isn't rising. I think that's because China sees little choice

 but to use exports to offset the impact of falling fixed-asset investment.The rub is this: an artificially cheap yuan is one of the ways China suppresses household purchasing power and consumer spending. Its support forexporters is discouraging households that might otherwise be flexing their muscles and leading a rise indomestic-demand growth.Couldn't China just let the currency rise and count on households to provide thegrowth that exporters no longer can? A  new paper by Barry Eichengreen and Andrew Rose suggests it's notthat simple. They assemble a sample of countries that left pegged currencies with the expectation thatappreciation would follow, and they find that in most cases economic disaster does not result. But:

 [I]t is possible to pinpoint the kind of circumstances where the decision to move to greater flexibility is likely

to be followed by a significant economic slowdown. The slowdown‐ prone economies are those with

exceptionally low consumption rates and high investment rates. They are economies where exports and 

domestic credit have been growing most rapidly. To put it simply, they are economies with Chinese

characteristics.

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China needs a way to rebalance its economy without undergoing a big slowdown, of the sort that might lead topolitical instability (highly undesirable as a power handover looms). Until now, China managed to take steps inthis direction by revving up fixed-asset investment, but it now finds itself forced to pull back on that front.Seemingly short of ideas, it has since returned to the model of big surpluses and reserve accumulation.It'sgoing to end at some point. Maybe not with an economic crash. Amid a growth slowdown, however, thepolitical system could prove somewhat more brittle.

11. The Olympics. Rewards of the rings. Why, against all odds, Londoners might enjoy the games

SIXTEEN centuries ago the Roman Emperor Theodosius branded the Olympic games pagan and banned them.Some Britons are beginning to think that he was a man of sound views. They resent paying for the games anddread the traffic jams. This week the  Sun, a British tabloid, complained of “road chaos as athletes arrive”, a“security shambles” and “as for that bloody rain…”—which, admittedly, is not directly attributable to thegames, but has to be blamed on something.Part of the reason that people get grumpy about the games isinflated expectations: the Olympics are always mis-sold. First, host governments say that the economic benefits of the games will greatly outweigh their costs. Second, they claim that the games will inspire people toexercise more. Third, they predict intangible benefits from being in the global spotlight for a couple of weeks.

The first two claims are rubbish; the third does not apply to London.David Cameron, Britain’s prime minister,promises a bonanza of £13 billion ($20 billion); but the games rarely make money for their hosts. The firmsthat win contracts are happy, as are the sponsors (see article). The Olympic bureaucracy sucks in billions from broadcasters. But the host nation is not so lucky: 100% of Olympiads since 1960 have seen cost overruns. Theaverage overspend, at 179%, is worse than any other kind of megaproject, including dams. London is even worse: the government’s budget for the games went up from an original estimate of £2.4 billion in 2005 to£9.3 billion now.Estimates of benefits, alas, are usually too rosy. They tend to overlook extra costs, such assecurity, that taxpayers bear. They fail to recognise that, although many tourists will come to watch the games,many will also stay away to avoid the crush (see article). And they fail to account properly for opportunity costs. Building an Olympic Park is an expensive way of sprucing up a run-down part of London. That

 Velodrome is grand, but who will use it when the Olympians are gone?The evidence that the games makepopulations healthier is also scant. Britons and others could certainly do with more exercise (see article). But if  watching all that running and jumping makes them jump up and run to the gym, the effect is too small todetect. After the 2000 games in Sydney, Australians were slightly more likely to take part in seven Olympicsports, but slightly less likely to take part in nine.There may be intangible benefits to being an Olympic city. In1987, faced with mass protests calling for democracy, South Korea’s ruling generals could have given the orderto open fire, but that would have ruined the 1988 Seoul Olympics. Instead they gave in to the protesters’demands. The Olympic spotlight thus helped South Korea become a democracy: no small boon. That did not,however, work for China, where the 2008 games were accompanied by a political crackdown. As for hostcountries that already have pluralistic politics, the benefits are not obvious. A study by Stefan Szymanski andGeorgios Kavetsos found that hosting a big sporting event makes people significantly happier—so long as thatevent is the football World Cup. For the Olympics, the “hedonic effect” was insignificant.For Londoners,however, the games will have an upside. Because many of the events are in the city centre, the authorities fearthat the transport system may jam up. Their principal strategy for getting the visitors to the games is to tell thelocals to stay off the trains and the streets. The locals seem happy to comply, and many employers have agreedthat staff should “work from home”. The sofa, and two weeks of watching the world’s best athletes, beckon.

12. Bonds, project bonds and eurobonds

The idea of eurozone economies clubbing together to issue bonds representing all 17 member nations has beengathering momentum.And it has some pretty influential backers, including new French President FrancoisHollande, Italian Prime Minister Mario Monti, and the President of the European Commission, Jose ManuelBarroso.But those that really matter are less keen.The German government has said eurobonds "don't makesense" right now, given that individual member states conduct their own economic policies. It is alsoconcerned the introduction of such bonds could reduce the resolve of highly-indebted governments to balance

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their budgets.There does, however, appear to be a compromise in the works. The Germans seem open to theidea of "project bonds" that can be used to finance infrastructure investment across Europe.But what areeurobonds and project bonds (neither of which actually exists yet), and what are the government bonds on which they are based?

 What is a government bond?

Governments borrow money by selling bonds to investors. A bond is an IOU. In return for the investor's cash,the government promises to pay a fixed rate of interest over a specific period - say 4% every year for 10 years.

 At the end of the period, the investor is repaid the cash they originally paid, cancelling that particular bit of government debt.Government bonds have traditionally been seen as ultra-safe long-term investments and areheld by pension funds, insurance companies and banks, as well as private investors. They are a vital way forcountries to raise funds.

 What is a bond market?

Once a bond has been issued - and the government has the cash - the investor can hold the bond and collect theinterest every year until it is repaid. But investors can also buy and sell bonds that have already been issued onthe financial markets - just like buying and selling shares on the stock market.The price of the bond willfluctuate as the outlook for interest rates changes. So, for example, if the markets think that interest rates are

going to rise sharply, then the value of a bond paying a fixed rate of 4% for the next 10 years will fall. Bondprices will also fall if investors think that there is a risk of the government that issued the bond not being ableto make the annual interest payment or repay it in full on maturity - and these are the fears which have beenpushing down Spanish bond prices.

 What is a bond yield?

The bond yield tells the investor what the return on their investment is, and can be calculated based on thecurrent price of the bond in the market. If a 100-euro bond is paying 4% fixed interest - in other words, 4 eurosper year - and the bond can be bought for 100 euros, then the yield is 4%. If the bond price falls to 90 euros,then the yield will rise. That's because the investor is still getting paid 4 euros every year, and 100 euros atmaturity, which is a much bigger return compared with the 90 euros they must put down to buy the bond.

 Why do bond markets matter?

Because they determine what it costs a government to borrow. When a government wants to raise new money,it issues new bonds, and has to pay an interest rate on those bonds that is acceptable to the market. The yieldat which the market is buying and selling a government's existing bonds gives a good indication of how muchinterest the government would have to pay if it wanted to issue new bonds. So, for example, Spanish 10-year bond yields have risen above 6% in recent years. That means that if the Spanish government wants to borrow new money from the bond market for 10 years, it would have to pay an interest rate on the new bond of morethan 6%.

So what is a eurobond?

 A eurobond would operate in exactly the same way as a government bond, except that all 17 member states of the eurozone would collectively guarantee the debt rather than a single government.There are, however, many important questions about how a eurobond might work that remain to be answered. For example, if onegovernment could not pay its share of the bond payments, would the other 16 governments step in and makethe payments on its behalf? Would the government that got into trouble be required to prioritise its eurobondpayments over its other debts? Would government bonds of the individual member governments continue toexist alongside the eurobonds? Who would decide how to spend the money raised via eurobonds? If individualgovernments could spend the money, then how much would each government be allowed to borrow usingeurobonds and under what conditions?

How might a eurobond solve the crisis?During the financial crisis, investors have been much less willing to buy the bonds of troubled southernEuropean countries, and much more willing to buy the bonds of Germany and some other financially strongercountries. That has made it much cheaper for Germany to borrow, and prohibitively expensive for Greece, theIrish Republic and Portugal to borrow. The worry is that Spain and Italy may also find it too expensive to

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 borrow. Introducing eurobonds would level the playing field - all governments would be able to borrow at thesame interest rate.

 Why does Germany object to eurobonds?

Germany has three basic objections. First of all, the Germans do not see why they should be on the hook for allof the debts racked up by their southern neighbours, which is what a eurobond would entail. Secondly, it may make it more expensive for Germany to borrow, because markets may consider the eurozone as a whole to be amore risky borrower than the financial strong Germans on their own. Thirdly, and most importantly, the

German government is afraid that if they guarantee the debts of their eurozone neighbours, that will simply encourage the southern Europeans to borrow and spend more freely, making their debts even bigger and moreunsustainable.

 What about these "project bonds"?

The details are unclear, but it seems these would be issued by the European Commission. The borrowed money  would be spent by the Commission on infrastructure and other growth-enhancing investments, and wouldultimately be responsible for repaying the project bonds.They would be similar to eurobonds to the extent thatthe EU governments are collectively bound to support the Commission and make sure that it can repay thedebts. However, the amount of money involved in the project bonds would be far smaller than what is

envisioned by the advocates of eurobonds. The Commission's entire budget is equivalent to about 1% of theEU's GDP, whereas most EU government budgets are equivalent to about 50% of their respective GDPs. Nor would project bonds do anything to reduce the borrowing cost of the southern European governments,although it might help indirectly if markets think that the infrastructure spending by the Commission willsignificantly help the southern European economies to grow.

13. Global economy: Who can drive the recovery?

The global economy is faltering. In the aftermath of the global financial crisis, countries like Germany, Chinaand Brazil were the engines that kept the global economy expanding, but recent evidence suggests that they are

losing steam.The World Bank expects a soft recovery, with global growth of 2.5%. But within that there appearsto be a clear divide between developing economies, which are forecast to grow by 5.3%, and advancedeconomies by just 1.4%. Here is a round-up of the conditions and prospects for the key economies around the world. Who can be relied upon to drive the much-needed recovery?

China

• Second-quarter GDP growth has slowed to 7.6%

•  Annual Growth target has now fallen below 8% for the first time in almost a decade

China is now trying to shore up the economy after years of uncontrolled growth

China's second-quarter gross domestic product (GDP) figure has pointed to a continued slowdown in the Asianpowerhouse.

Growth fell to 7.6% in April-June period, its worst pace since the depth of the financial crisis and below the 8%target that China aspires to.

Considered to be the biggest export market for many companies from the likes of Burberry, Carrefour to BMW,a slow-down would hurt their earnings.

Burberry, which banked on China's love of bling (it enjoyed a 30% revenue growth in the country) reported  weaker-than-expected first quarter growth, disappointing investors.

Cooling growth in China and neighbouring India means the wider Asian region is likely to follow suit (asidefrom an exception or two like Thailand and the Philippines, which benefit from cheaper labour costs that havelured foreign companies).Beijing in March downgraded its annual growth target to 7.5%, the first time that'sdipped below 8% since 2004. The central bank recently slashed interest rates twice in less than a month in a bid to shore up growth.China had until recently been grappling with an overheating economy driven by a

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property bubble and by the central government's post-crisis spending binge - much of which went into localinfrastructure projects. The economy is now burdened with excess capacity and rising debt as unsold goodspile up in warehouses. Caterpillar, the US construction giant, had a drubbing from investors  in April when it said sales of construction equipment in China was expected to fall this year.But analysts are hopefulthat this marks the bottom for the world's second-largest economy, and that growth will pick up in the thirdquarter as Beijing loosens monetary policy and deregulates the financial system.

Eurozone

• Unemployment rate: 11.1%

• Over 3m people aged 15-24 are unemployed

• Eurozone economy set to shrink 0.3% this year

• German GDP expected to grow 0.7% this year

 Young people have been the hardest hit from the recession

The euro-sharing region has been a tale of two halves, between the relatively wealthier northerners (Germany,Netherlands, Finland and arguably, France) and struggling southerners (Greece, Italy, Portugal and Spain)that are bogged down by a range of crises (debt, property, banking).It is also a tale of much wrangling, as eachcamp differs on how to solve the eurozone crisis.The euro has plunged to its lowest level in two years againstthe dollar as investors fret over weak data and recent rescue plans for the region, including bailing out Spain's banks directly and forming a fiscal and banking union.And the ECB slashed rates for the first time below 1%recently, in efforts to encourage corporate and household borrowing.In order to reassure investors, Spainannounced a fresh round of austerity measures including tax hikes and spending cuts, which is squeezing analready squeezed out economy, but they remain unconvinced. But even Germany, which has enjoyed recordlow levels of unemployment thanks to its manufacturing prowess, has been unable to insulate itself from thesovereign debt crisis plaguing the region. Now, even the labour market is showing slower development. The jobless rate has risen for three consecutive months, reaching 6.8% in June. Meanwhile its double-digit exportsto China have shrunk to a mere 6% (although automakers have bucked the trend, thanks to Chinese officials'love of BMWs and Mercedes-Benz cars). Commerzbank, Germany's second biggest lender, recently  announced it was closing its real estate and ship finance units. Carsten Brzeski, senior European economistat ING Group said of Germany: "The most solid ship can capsize in a rough thunderstorm."

United States

• US facing a "fiscal cliff" as tax cuts end

• Unemployment rate of 8.2%: fears of jobless recovery 

• GDP expected to grow 2% this year

The US is divided over how to pursue recovery . The US economy added just 80,000 jobs in June, a sign of 

persistent weakness in the labour market and a critical issue which could make or break President Barack Obama's re-election chances later this year. The jobless rate has been stuck at 8.2%, although black workerssuffer more, with a 14.4% figure. Like its European peers, the US is struggling under piles of debt, which makesup around 70% of GDP. It is also staring at a so-called fiscal cliff, which refers to a combination of tax increasesand spending cuts scheduled to start at the beginning of next year. The inevitable result would be an austerity-driven recession - a prospect that prompted the Senate's top tax legislator Max Baucus to warn that theeconomy was on a "dangerous path" that could lead to a European-style fiscal crisis. And, like much of thedisagreements that have thwarted a coherent, concerted plan in Europe, both Republicans and Democrats have been unable to agree on a plan that would avoid that dismal outcome. Despite gloomy headline figures, the USeconomy is forecast to grow 2% this year, the best of the advanced economies - and even more than Brazil. The billionaire entrepreneur Warren Buffett said the US was still doing better than "virtually any other bigeconomy" around the world.The US has undertaken a series of unorthodox measures to shore up the economy,

its latest being Operation Twist, a bond-buying programme designed to bring down mortgage and loanrates.Investors want more, but they might be disappointed, if recent noises from the US central bank areanything to go by. "There is not much to expect from economic data, there is not much to expect from earnings,so the only thing markets hope for is more quantitative easing, more stimulus from Europe - more stimulusfrom everywhere," said Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets.

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Brazil

• Economists forecast GDP to grow by 2% this year

• Loan delinquencies rose to 6% in May 

Planemaker Embraer has symbolised Brazil's growing fortunes.Government spending and exports of commodities like soy beans and metals to fast-growing countries in Asia, have propelled Brazil's economy tosixth place in the world. But red-hot growth when Latin America's largest economy clocked in a 7.5% growth

rate in 2010 appears to have fizzled out. The economy stalled in May following an unexpected drop in retailsales. That heightened fears for what was one of the few bright spots of the world economy, making it the worstperformer among Brics nations.Growth in Brazil is predicted to be less than 2% this year, the weakest annualperformance since 2009.In response, the government unveiled the first phase of a major economic stimuluspackage designed to boost growth in the flagging economy.More than $60bn (£38bn) will be invested in thecountry's roads and railways over the next 25 years, with more than half in the next five years. This includes8,000 kilometres of new roads and 8,000kms of railways and further investments in ports and airports areexpected.The government's recent measures, such as the recent devaluation of the currency, the real, and theprogressive reduction in interest rates, have so far failed to stimulate growth.Brazil's growth over the past few  years has been based on the expansion of credit and on consumer spending, and is hoping for an economic boost from hosting the Olympic Games in 2016.

India• GDP grew 5.3% in the first quarter, slowest for nine years

• Inflation highest of Bric nations

• Industrial production up 2.4% in May 

India's chronically high inflation is tough to handle .India's economy grew at an annual rate of 5.3%  between January and March, its slowest pace in nine years.Rising consumer prices have been one of the biggest concerns for India's policymakers over the past two years. The central bank took various measures in a bid to control the rising prices, including raising interest rates 13 times since March 2010. While the inflationrate has come down slightly in recent months, it still remains higher than many of the other emerging

economies. According to data released last week , India's wholesale price index, the key measure of consumer prices in the country, rose by 7.55% in May from a year earlier, among the highest of the Bricnations. Analysts say the combination of slowing growth and high inflation has made it difficult for the central bank to formulate its policies. Cutting rates would stimulate growth, but could end up making inflation worse.

GDP is expected to grow by 6.5% this year, according to the Asian Development Bank. Its government has vowed to attract more foreign investment and speed up infrastructure and power projects.

Japan

• Recovering from last year's major disasters

• Exporter worried about eurozone woes and US slowdown

• Growth expected to be 2.2% this year

Japan has struggled in the aftermath of last year's disaster.Once the world's number two economy, Japan isstill recovering from last year's devastating tsunami and nuclear crisis. Recent data have shown that Japan, oneof the world's top exporters, was not exporting as much as it used to. In fact it has been massively importing -including energy, which has pushed the country's energy bills sky high after Tokyo stopped nuclear reactors.The strong yen has also hurt exporters, making their products more expensive to foreign buyers.

However, sentiment is improving. The Tankan survey showed manufacturers were less pessimistic about business conditions. The Bank of Japan forecast the economy would grow 2.2% in the current fiscal year and1.7% the following year. The rosy growth projections were enough for the central bank to hold off on furthereasing to boost the economy."Japan's economic activity has started picking up moderately as domestic demand

remains firm mainly supported by reconstruction-related demand" following last year's natural disasters, theBank of Japan has said. "[But] there remains a high degree of uncertainty about the global economy, includingthe prospects for the European debt problem... [and] the momentum toward a recovery for the US economy."

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14. German economic strength: The secrets of success

The German education system is much more geared to vocational training than many of its economiccompetitors Imagine a country whose inhabitants work fewer hours than almost any others, whose workforceis not particularly productive and whose children spend less time at school than most of its neighbours.Hardly a recipe for economic success, you might think.But the country described above is none other than Germany,Europe's industrial powerhouse and the world's second largest exporter; a country whose economy has single-handedly stopped the eurozone falling back into recession and the only nation rich enough to save the euro. When you consider that only the Dutch work fewer hours among the 34 members of the OECD, that Germanchildren spend 25% less time in the classroom than their Italian counterparts, and that there are six moreproductive economies in Europe alone, these facts appear all the more remarkable.So why is the Germaneconomy so powerful, and what lessons can the rest of us learn from it?

Euro bliss 

There is no doubt that Germany has benefited greatly from the euro.By getting into bed with more sluggisheconomies in southern Europe, Germany adopted a much weaker currency than would otherwise have beenthe case - as one of the very few countries in the world running a balance of payments surplus, thedeutschmark would have been a great deal stronger than the euro. This has provided a terrific boost to Germanexports, which are cheaper to overseas consumers as a result.But this goes only some way to explainingGermany's current economic might.Just as important are the relatively low levels of private debt. While the

rest of Europe gorged on cheap credit throughout the 1990s and 2000s, German companies and individualsrefused to spend beyond their means.One reason for this, says David Kohl, deputy chief economist atFrankfurt-based Julius Baer bank, is that real interest rates in Germany remained stable, unlike those in otherEuropean economies. "In the UK, Italy, Spain and Portugal, for example, higher inflation meant real ratesmoved down, so there was a huge incentive to borrow money," he says.But cultural differences are just assignificant - quite simply, Germans are uncomfortable with the concept of borrowing money and prefer to live within their own means."In German, borrowing is 'schulden', [the same word for] guilt. There is an attitudethat if you have to borrow, there is something wrong with you," says Mr Kohl.This has been particularly  beneficial to Germany in recent years - unlike its European counterparts, consumers and businesses did notneed to slash spending to cut their debt levels when banks stopped lending during the recession.

Labour reforms But there are other, deep-rooted reasons behind Germany's current economic pre-eminence in Europe, notleast in fact the relatively low number of hours spent at work and in the classroom.Germany embarked upon aprogramme of fundamental labour market reform in 2003, sparked by the excesses of post-unification wageincreases.Strong employment protection legislation and a degree of trust on behalf of the workforce in well-capitalised companies that had not over-borrowed, meant the Social Democratic government was able to useits close ties with labour unions to push for moderation in wage inflation.The reforms laid the foundation for astable and flexible labour market. While unemployment across Europe and the US soared during the globaldownturn, remarkably the jobless number in Germany barely flickered.German workers were simply willing to work fewer hours, knowing that they would keep their jobs because of it. They were all the more willing to doso due to the stronger bond that exists between workers and employers compared with many other

countries."There is a culture of business owners acknowledging and rewarding the efforts of the workforce,"says Andreas Woergoetter, head of country studies at the OECD's economics department.No wonder, then,that Germans work fewer hours than most.

Job skills 

More important still to Germany's industrial strength is the country's education system.School finishes atlunchtime across much of Germany due to what Mr Woergoetter calls a "societal preference", designed to allow children to spend more time with their families.But it's in the later years of schooling that the German modelreally stands apart."Half of all youngsters in upper secondary school are in vocational training, and half of these are in apprenticeships," says Mr Woergoetter.Apprentices aged 15 to 16 spend more time in the workplace receiving on-the-job training than they do in school, and after three to four years are almost

guaranteed a full-time job.And in Germany, there is less stigma attached to vocational training and technicalcolleges than in many countries."They are not considered a dead end," says Mr Woergoetter. "In somecountries, company management come from those who attended business school, but in Germany, if you'reambitious and talented, you can make it to the top of even the very biggest companies."The German educationsystem, therefore, provides a conveyor belt of highly skilled workers to meet the specific needs of the country's

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long-established and powerful manufacturing base, which is rooted in the stable, small-scale family businessesthat have long provided the backbone of the economy.

Lessons learned 

There is clearly much to learn from the German model, but blind replication may not be the answer.Germany is home to some of the world's best-known manufacturers Many economies jealously covet Germany'smanufacturing prowess, particularly while demand for its industrial products in emerging markets such asChina continues to boom.And yet, not so long ago, the roles were reversed."Ten years ago, we in Germany were

looking at the much higher value-added potential of the UK service sector," says Mr Kohl."There are limits toadding value in manufacturing. If you want to be rich and move up the value chain, you need to be inservices."As unlikely as it seems, perhaps one day Germany will once again look to others for inspiration.

15. Eurozone avoids recession after strong German growth

The eurozone has narrowly avoided returning to recession after recording zero growth in the first threemonths of the year, figures have shown.The stronger-than-expected performance was in large part due togrowth of 0.5% in the German economy.In the final quarter of 2011, the eurozone shrank by 0.3%, and many analysts expected further contraction.The French economy recorded zero growth in the first quarter of 2012, while the Italian economy contracted by 0.8%.The Italian economy shrank by 0.7% between October and

December last year, and it has now contracted for three consecutive quarters. The country is struggling as thegovernment cuts back on spending, raises taxes and reforms pensions in an attempt to cut debt levels. The figures from Eurostat also showed that Spain's economy shrank by 0.3% in the first quarter.Separately, theGreek national statistics office said the nation's economy had contracted by 6.2% in the three-month period.Greece is implementing drastic austerity measures to cut its deficit and comply with the terms of a massive bailout from the European Union and the International Monetary Fund.Looking ahead, the situation will only get worse as the periphery remains mired in recession and German exports falter”These measures have provedhugely unpopular with Greeks, the majority of whom voted against austerity in elections earlier this month. OnTuesday, politicians admitted defeat in their attempts to form a working coalition, meaning Greece will go thepolls again next month.News of the breakdown in talks pushed Greek stocks down almost 6%, which in turndragged major European exchanges lower. However, investors soon recovered some composure, with the

 Athens exchange down about 3.5% and the main London, Paris and Frankfurt indexes about 0.5% lower by mid-afternoon trading.

'Weak consumption' 

The German statistics agency, Destatis, said the country's economic growth was due to a rise in exports andhigher domestic consumption.The return to growth means Germany has avoided a so-called double-diprecession, confounding the predictions of a number of commentators."This is a very strong comeback. Thedecline in the fourth quarter was not the start of a recession but just an economic dip," said Joerg Kraemer atCommerzbank. "Germany is faring better than the rest of the eurozone. But I do not believe that it willcontinue at this speed." In contrast, the French growth figures failed to outperform analysts' expectations, andthe growth figure for the final quarter of last year was revised down to 0.1% from 0.2%."There was no goodsurprise," said Philippe Waechter at Natixis Asset Management. "There was weak consumption [and] noinvestment."Some analysts believe that the first quarter may prove something of a temporary respite as many eurozone economies continue to struggle amid weak demand, high unemployment and dramatic cutbacks ingovernment spending."Looking ahead, the situation will only get worse as the periphery remains mired inrecession and German exports falter," said Capital Economics."Indeed, eurozone business surveys like thecomposite Purchasing Managers Index (PMI) already point to a contraction of about 0.3% in the secondquarter."The closely-watched PMI survey published earlier this month showed one of the steepest monthly contractions in the eurozone's private sector for almost three years.A survey of German investors published onTuesday also suggested confidence was weakening, with the Zew poll of economic sentiment dropping to 10.8in May from 23.4 in April.

Case for growth The French growth figures came on the day of the inauguration of the new French President FrancoisHollande, who has vowed to boost economic growth.In the run up to the presidential election, in which heousted Nicolas Sarkozy, he campaigned hard for measures focusing on stimulating the economy alongside theausterity measures that have been adopted across the eurozone.He will speak personally to German Chancellor

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 Angela Merkel in Berlin later on Tuesday to make the case for growth.Mr Hollande believes that growth ratherthan austerity is the best way for governments to reduce their debts, a view that is being discussed more widely as the eurozone economy continues to struggle and increasing numbers of Europeans voice their anger atausterity.

16. What is a rating agency?

 A high score from a credit rating agency means cheaper borrowing - a low mark carries a heavy price AAA, Ba3,Ca, CCC... they look like some kind of hyper-active school report.They are, indeed, a marking system, and onethat is designed to inform interested parties.The letter formations are given to large-scale borrowers, whethercompanies or governments, and tell the buyers of this debt how likely they are to be able to get it back.Thescore card also affects the amount that should be charged by way of return on that borrowing. These lettershave been all over the coverage of the financial impact of the crisis besetting the eurozone.A change to thescore means a change to the amount a borrower must pay its debt-holders, something that can make it moreexpensive to borrow as investors demand a higher rate of return for taking on more risky debt.But while the borrowers in the news with the downgraded scorecards now include most European governments - even themighty US - and are household names, the companies that have such an impact on their fortunes are nowherenear as familiar.

CREDIT-RATING AGENCIES

• Private-sector firms that assigns credit ratings for issuers of debt

•  A credit rating takes into account the debt issuer's ability to pay back its loan

• That in turn affects the interest rate applied to the security (eg a bond) being issued

•  A credit downgrade can make it more expensive for a government to borrow money 

They are credit-rating agencies, which exist to assess the creditworthiness of bond issuers - companies or, as inthis case, countries who borrow money by issuing IOUs known as bonds.Their power is now so feared that theEuropean Commission has a set of proposals designed to rein them in, including requiring them to be moretransparent about their ratings and to be held accountable for their mistakes. It also views them as hostile because the leading agencies are US-based. It would like to see a European agency of equal status. But who arethey? Do we need them and how do they work out whether to give the top-of-the-class AAA or a lower grade,such as CCC, which - sticking with the schools analogy - means the issuer is suspected of planning the financialequivalent of bunking off?

Poor and Moody  

Standard & Poor's (S&P), as the oldest, comes first. It was begun in 1860 by Henry Poor, who wrote a history of the finances of railroads and canals in the United States as a guide for investors.The "Standard" part came into being in 1906, when the Standard Statistics Bureau was set up to examine finances of non-railroad companies.The two businesses joined forces in the 1940s. Moody's was started in 1909 by John Moody, who published ananalysis of the tangled and uncertain world of railway finances, grading the value of its stocks and bonds.Theseare now mighty concerns - Moody's operating income was $688m in 2010 and Standard & Poor's made$762m.They each have 40% apiece of the business of rating major companies and countries.Fitch, withanother eponymous founder, John Fitch, was set up in 1913 and is a smaller version of the other two. There arehosts of other ratings agencies, whose names rarely appear even within the darker corners of the financialpages - so why are these three businesses the ones everyone watches?

Track Record 

Part of the answer lies with the Securities and Exchange Commission (SEC), the US financial watchdog.In1975, it acknowledged these three as Nationally Recognized Statistical Rating Organizations (NRSRO).Thereasons for ratings adjustments vary, and may be broadly related to overall shifts in the economy or business

environment - or more narrowly focused on circumstances affecting a specific industry, entity, or individualdebt issue”An endorsement from an NRSRO makes life quicker and easier for countries and financialinstitutions wishing to issue bonds. It basically tells investors a firm has a track record and indicates how likely it is to be able to pay back the money.Further impetus for NRSROs comes from the fact that certain regulatedinvestment funds are required by the SEC to hold only those bonds that have a very high rating from accreditedagencies.An insurance company's strength is also judged by the ratings applied to the investment reserves it

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holds. A downgrade of an issuers' rating pushes down the value of a bond and raises its interest rate. It canmean regulated funds must now sell these bonds. But this can cause a vicious circle.A big sell-off adds inmarket forces - more sellers than buyers - reducing the price further. That means a yet higher interest ratemust be paid - and that puts an even bigger strain on the borrower.Although the SEC has 10 NRSROs on itsapproved list, including a Canadian agency and two Japanese ones, the big three - Standard & Poor's, Moody'sand Fitch - remain the industry standard-bearers.This is partly because they make their ratings available freely to investors - making their money from charging the organisations who want their bonds rated.

Heavy criticism 

So much for their size. What of their actual methods?Standard & Poor's says a committee of between five andeight people decides the actual rating.They base their judgments on a range of financial and business attributesthat might influence the repayment, some of which may depend on the issuer of the bond (ie the borrower).Ina statement, S&P gave a long list of indicators it might use, including "economic, regulatory and geopoliticalinfluences, management and corporate governance attributes, and competitive position". That seems to covereverything. But since the credit crisis that began in 2007, these agencies have come in for heavy criticism.TheEU Internal Market Commissioner, Michel Barnier, said: "Ratings have a direct impact on the markets and the wider economy and thus on the prosperity of European citizens. They are not just simple opinions. And ratingagencies have made serious mistakes in the past."

SCORE CARD

• Rating agencies use different systems involving a long list of letters

•  A top mark is AAA or Aaa

• Down to BBB or Baa3 is also safe

• BB or Ba1 down to C is speculative - or "junk"

• Other less sequential numbers are applied to the worst kind of bond

 After all, stacks of mortgage-backed securities - the investments that were backed by mortgages that wereeither never going to be paid back or were even fraudulent - were given the very best grade by the threesupposed experts in rating the likelihood of the money being paid back.Changes in the ratings applied togovernment-backed, rather than private property-supported debt are generally less dramatic but still have amajor effect. One day a country's bond is graded a safe top rating and the next given a mark that suggestsinvestors' money is less safe.Many observers believe that if the rating on the UK's government bonds - or gilts - was downgraded by just one notch from AAA to AA it would put up the cost of official borrowing by aroundhalf of one per cent.That would mean a big rise in the annual interest bill which has to be met by taxpayers.When asked why it changes ratings, S&P responded: "The reasons for ratings adjustments vary, andmay be broadly related to overall shifts in the economy or business environment - or more narrowly focused oncircumstances affecting a specific industry, entity, or individual debt issue."It indeed appears a dark art - butone whose influence has a more measurable effect.

17. Printing money: How to create a currency 

Creating a new currency would be a massive challenge for Greece. European officials may not like it, but theprospect of Greece leaving the euro is still a serious possibility.June's election handed a narrow election victory to the pro-bailout New Democracy party, preserving the deal that guarantees the country access to vitaleurozone funds.But fears that Greece can stick to the exacting conditions of that deal remain.If the EuropeanUnion and IMF-backed reform programme falters in future, then Greece might still have to look for a new currency.It would not be a simple case of resurrecting Greece's old currency, the drachma.Changing currency isa complicated process that would take at least six months and probably much longer.Over the last 20 years atthe International Monetary Fund, Warren Coats has advised numerous countries on how to create currencies.

His clients have included nations that emerged from the Soviet Union including Kyrgyzstan andKazakhstan.Mr Coats has also helped Iraq and Afghanistan and, most recently, Southern Sudan to launch new money.He says there are three phases to the process.

Currency design and production

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"Deciding what and who appears on a nation's currency might sound trivial, but it is highly political," said MrCoats.Bosnia-Hercegovina is a good example of how difficult the situation can be.In the late 1990s after a bloody war for independence, the nation had to form a new currency.But the three groups that make up thepopulation, Bosniaks, Croats and Serbs, could not agree on who to put on the notes - even when the choice waslimited to literary and artistic figures."Usually two would agree, one would disagree," said Mr Coats."This wenton for many months. And in the end, there was never an agreement," he said.The head of the central bank,Peter Nicholl, who was a New Zealander appointed by the IMF, decided what went on the currency.In Greece'scase, the situation is much less fraught. It can draw on the images and figureheads used on its previous

currency, the drachma.It may, though, have to decide on how many denominations of note there will be and what they will be worth.There is a useful rule of thumb to help with that.Experts say the largest coin should be worth about 2% of the average day's wage and the smallest note should be worth 5% of the average day's wage.Once those details are sorted out, the notes will have to be printed, which is usually done by a specialistprinting firm. It is estimated that for a country the size of Greece, that would cost $50m-$60m.There are notmany firms that can handle a contract of that size and if they are busy, then Greece might have to wait for itsnew currency.Analysts say there is no chance of a new currency before the end of this year."If this was a seriousconsideration for 2012, the presses would have to be running already. And there are no credible rumours thatthat is happening," said Paul Jones an analyst at Panmure Capital.

Preparing rules for exchange

Getting the new currency printed is just the start of the process.Greek officials would then have to work outhow to get that new currency into the system.The problem for Greece is that the population is unlikely to wantto exchange their euros for the new currency.Rules may have to be put in place to prevent large amounts of euros leaving the country.There would have to be an information campaign to make sure the populationunderstood how the process would work.The question of timing also has to be addressed at this stage. Ideally, banks and other businesses would need enough time to adapt their systems.The notes would have to bedistributed to banks and a launch date set.

Legal issues

Notes and coins are just pieces of paper and bits of metal until they have the status of legal tender.Thatrequires laws which define and control the use of a currency.When swapping a currency, these have to beadapted and laws will have to be approved in parliament.Business will have to look closely at the new legislation to see if contracts priced in the old currency are still valid or need renegotiation.So should Greeceembark on such a lengthy and expensive process?Mr Coats has this final thought: "The majority of Greeks want to keep the euro because they don't trust their government and central bank to do better with a new currency of their own than they did with the old one."

18. EU austerity drive country by country 

Protests have become a common sight on the streets of Europe's cities as austerity measures bite

Europe is in the grip of tough austerity measures - some of the deepest public sector cuts for a generation. Thecolossal debts and rock-bottom growth of eurozone "periphery" nations - especially Greece, Italy and Spain- have hammered market confidence. The interest rates (yields) on their sovereign bonds have soared, makingit hard or even impossible for them to borrow in international markets.Greece, the Republic of Ireland andPortugal have all received massive bailouts from the EU and International Monetary Fund (IMF). The 27 EUmember states aim to cut deficits to a maximum of 3% of GDP by the financial year 2014-15, so what belt-tightening measures are the countries taking?

Greece

Greece is the biggest worry for the EU, after elections on 6 May produced a surge in support for parties

opposed to the tough austerity conditions attached to the country's bailout.There is now great uncertainty about Greece's ability to fulfil its austerity pledges and much speculation about a possible Greek exit from theeurozone. The left-wing bloc Syriza, which came second in the inconclusive election, looks poised to do wellagain in new elections on 17 June. It has vowed to tear up the bailout agreement - yet insists that Greece shouldkeep the euro.The previous technocratic government of Lucas Papademos negotiated a second massive bailout

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for Greece, worth 130bn euros (£110bn; $173bn). It took months of difficult talks with international lenders before a deal was reached in March.In the largest restructuring of government debt in history, lenders and banks wiped 105bn euros ($138bn, £88bn) off Greece's debt burden.But in order to receive the new bailout,the Papademos government committed Greece to far-reaching spending cuts, equal to 1.5% of its output.Greece has now been in recession for five years.The cuts proved deeply unpopular with the Greek people,leading to a wave of protests and crippling strikes. To make the economy more competitive Greece pledged tocut the minimum wage and make labour markets more flexible, weakening job security.The aim is to cut theGreek government's debt from 160% of GDP to a little over 120% of GDP by 2020.The more unpopular

austerity measures include a new property tax and the suspension of 30,000 civil servants on partial pay.Many Greeks feel the credit terms are intolerable, condemning the country to years of painful cuts and job losses. Theunemployment rate has risen to 22%.Greece remains frozen out of international credit markets because itssovereign debt has junk status.

Italy 

This year Italy has slid further into recession - its steepest economic contraction for three years.The crisistoppled the veteran leader who dominated Italian politics for two decades - Silvio Berlusconi.The immediatetrigger for his downfall was Italy's soaring bond yields - they entered the 7% danger zone, generally regarded asunsustainable.The markets are still jittery about Italy's public debt, which rose to abound 1.9 trillion euros(approximately 120% of GDP) at the end of 2011. A former EU commissioner, Mario Monti, replaced Mr

Berlusconi with a promise to get Italy's economy back on track. The Berlusconi government had already adopted an austerity package in July 2011, featuring savings worth 70bn euros. It included increases inhealthcare fees, and cuts to regional subsidies, family tax benefits and the pensions of high earners.Mr Monti'sadministration has pushed through further austerity measures, including higher taxes for the wealthy, a rise inpension ages and a major drive to tackle tax evasion.The government aims to cut public spending by 4.2bneuros this year.Italy has been cutting public sector pay and freezing new recruitment. Only one employee will be replaced for every five who leave.The government is currently locked in a dispute with unions over labourmarket reforms. The changes - supported by the EU - would make it easier to sack staff.

Irish Republic

The IMF signed off on a 3.9bn euros (£3.2bn) tranche of loans to Ireland in December 2011, following on froma EU/IMF bailout worth 85bn euros a year earlier. In July 2011, EU leaders agreed to a request from the new government of Enda Kenny to lower the interest rate from around 6% to between 3.5% and 4%.The length of time to pay back the loan was also extended from seven-and-a-half years to 15 years.The toughest budget in thenation's history included a pledge to trim the deficit by 6bn euros in 2011. Government spending has beenslashed by 4bn euros, with all public servants' pay cut by at least 5% and social welfare reduced. VAT rose to23% as child benefit was cut and police stations were closed. The government aims to cut public service pay by 400m euros in 2012.Ireland's economy shrank by almost 2% in the third quarter of 2011, compared withgrowth of 1.4% in the previous quarter.

Portugal

In May 2011 Portugal became the third eurozone country to receive a huge EU/IMF bailout - 78bn euros.A new centre-right coalition government took office with a big enough majority to pass the austerity measuresnecessary under the bailout conditions. The previous minority Socialist government fell after failing to getopposition backing for a new austerity package.The new government adopted a range of austerity measures,including a 5% pay cut for top earners in the public sector, a VAT rise of 1% and income tax hikes for high-earners. The military budget is being slashed and two high-speed rail projects have been postponed.There hasalso been widespread privatisation, and unemployment rose to 14.8% in January 2012.In March, public sector workers staged their second strike in four months to protest against the measures.

Spain

Unemployment in Spain has soared to nearly 25% - the highest rate in the EU - and for young people under 25the rate is above 50%.The new conservative government of Prime Minister Mariano Rajoy plans to cut 27bneuros from the state budget this year - one of the toughest austerity drives in modern Spain's history.Changes will include freezing public sector workers' salaries and reducing departmental budgets by 16.9%. Health andeducation are among the areas hit.The cuts are aimed at meeting the new deficit target agreed with the EU

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Commission: 5.3% of output (GDP) this year.Spain had already passed an austerity budget in 2011 whichincluded tax rises for the rich, a 28% increase in the tax on tobacco and 8% spending cuts. Spain has seen widespread protests against austerity , with makeshift tent cities organised by young people who fear a bleak, jobless future.A general strike was held ahead of the new budget in March and hundreds of thousands of people turned out on the streets to protest against austerity measures.

UK 

 At the start of its term in 2010, the Conservative-Liberal Democrat coalition government announced the biggest cuts in state spending since World War II. Savings estimated at about £83bn are to be madeover four years. The plan is to cut 490,000 public sector jobs. Most Whitehall departments face budget cuts of 19% on average. The retirement age is to rise from 65 to 66 by 2020. The budget deficit is about 10% of GDPand unemployment - officially 2.67 million (8.4%). That is its highest level since 1994.In the 2012 budget,Chancellor George Osborne announced several measures to ease taxes - including a 5% cut to the top rate of tax and a rise in the personal income tax allowance threshold.However, he also cut the personal income taxallowance pensioners receive, reduced child benefit and raised taxes on tobacco and other items.Public angerover the cuts has grown. More than 250,000 people demonstrated in London in March 2011 - the city's biggestprotest since the 2003 Iraq war. Protest camps sprang up in cities across the UK towards the end of 2011,echoing similar "occupy" sit-ins around the world.

France

France's new Socialist President, Francois Hollande, has made it clear he aims to shift the EU's emphasis away from austerity and towards growth.Controversially he says he wants to renegotiate the EU's fiscal pact -already agreed by 25 nations - to include measures to stimulate growth. In the run-up to his victory on 6 May he promised to increase taxes on big corporations and people earning more than 1m euros a year.He wants toraise the minimum wage, hire 60,000 more teachers and lower the retirement age from 62 to 60 for some workers.The previous centre-right government of Nicolas Sarkozy announced plans for 65bn euros of  savings by 2016, including closing tax loopholes and withdrawing temporary economic stimulus measures.Mr Hollande is also committed to balancing France's budget, but a year later than Mr Sarkozy - in 2017.

Germany 

Germany's economy is doing better than most in Europe. It grew by 3% in 2011 and its growth of 0.5% in thefirst three months of 2012 was stronger than expected. The German performance - largely a result of strongexports - meant the eurozone as a whole narrowly avoided returning to recession.German unemployment in April was 7% - the lowest rate in more than 20 years.The government plans to cut the budget deficit  by arecord 80bn euros by 2014. The plans include a cut in subsidies to parents, 10,000 government job cuts overfour years, and higher taxes on nuclear power.

19. World Economic Forum: China growth on track, says Wen JiabaoChina's Premier, Wen Jiabao, has told the World Economic Forum in Tianjin that his country is on track to hitgrowth targets for this year.He also called on international leaders to strengthen co-ordination and opposetrade protectionism during the global economic slowdown.His address comes amid signs that China's economy may be slowing faster than previously thought.Manufacturing and export growth have slowed, while importshave dipped.This has raised concerns about a decline in both external and domestic demand, in turn sparkingfears that Beijing may miss its growth target for 2012. But Mr Wen said: "We are fully confident that we havethe conditions and capability to overcome difficulties on the way ahead, maintain fast and stable economicgrowth and realise development at a higher level and with better quality."The economic growth is still withinthe target range set at the beginning of the year and is showing stabilising signs despite the slowdown."The

government set a growth target of 7.5% for 2012.In the run-up to the conference, analysts said the 2,000-plusdelegates would be following Mr Wen's speech closely to gauge how China would sustain its growth amid anuncertain global economic environment.However, he gave little detail on specific policies designed to stimulateslowing growth.But he did call for world leaders to work together to boost global growth."I hope that theinternational community will strengthen macroeconomic policy co-ordination, push forward reform of theglobal governance structure, resolutely oppose trade and investment protectionism, and work jointly for an

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early, steady recovery of the world economy," he said.China's leaders are used to presiding over an economy that has been the envy of the world. But Premier Wen Jiabao gave his key address to senior business figures atthe World Economic Forum in Tianjin against the backdrop of some of the worst economic news China hasseen in years. Weak demand in Europe and America is hitting exports, while China's own domestic economy appears to be slowing fast too. It all means that growth this year will fall to around seven percent, the lowest intwo decades. Premier Wen and China's other Communist leaders are preparing to hand power to a new generation in just a few weeks time. The dilemma is whether they should take more measures now to try tostimulate China's economy.Two of the biggest drivers of China's economic growth in the past few years have

 been the success of its export sector and an investment boom in the country.However, both these sectors haveseen a slowdown in recent times. China's exports have been hurt by slowing demand from key markets such asthe US and eurozone. And because the economic climate in those two regions has failed to improve, the sectoris likely to see slowing growth in the coming months.At the same time, investment growth in China has slowedafter measures to curb lending were introduced.The state wanted to keep property prices from rising toosharply and forming asset bubbles. However, there have been concerns that those measures may have backfired. Prompted by such fears and continued weakness in the global economic environment, China haseased its policies to try and boost lending and investment again. It has cut interest rates twice since June andalso lowered the amount of money that banks need to keep in reserves three times in the past few months. Themeasures have seen lending surge. According to data released on Tuesday, Chinese banks extended 703.9bn yuan ($111bn; £69bn) in new loans in August. That is up from 540bn yuan in July.Last week, the government

also approved infrastructure projects worth more than $150bn.Analysts said the increase in lending and a pushfor new infrastructure investment was likely to help boost growth."This is basically consistent that the policy stance is much more proactive and more loose than before, because they saw the risks to the economy," saidZhiwei Zhang, chief China economist at Nomura."I think we'll continue to see infrastructure spending is pretty strong. We're predicting a pretty sharp recovery in the fourth quarter, a very strong rise," he added.

20. Why do we pay more than we should at auctions?

The reason we end up overspending is a result of one unavoidably irrational part of the bidding process – andthat’s ourselves. The jury is still out on whether one aspect of the fastest-selling PC game ever, its real-money auction house, is the success that its makers want, and perhaps need, it to be.The allure and tension of anauction are familiar to most of us – let’s face it, we all like the idea of picking up a bargain. And on-line auctionsites like eBay cater for this, allowing us to share in the over-excitement of auction bidding in the privacy of ourhomes. Yet somehow, despite our better judgement, we end up paying more than we know we should havedone on that piece of furniture, equipment or clothing. What's going on?One estimate states that about half of eBay auctions result in higher sale prices than the "buy it now" price. This is a paradox. If the people going intothe auction really wanted the item so badly, why didn't they get it for less by paying the "buy it now" price?Thishas nothing to do with the way the eBay bidding system works. In fact, unlike most auctions, the eBay auctionprocess is actually perfectly designed to allow rational outcomes. By allowing you to set a private “maximum bid” in advance, eBay auctions are better for individual buyers than public auctions where everyone has toshout out their bid in public. No, the reason auctions – both on and offline – produce higher sale prices thanany bidder originally imagined they would pay is because of one irreducibly irrational part of the biddingprocess: the bidders themselves. Auctions push a number of our psychological buttons, and in fact thephenomenon of “auction fever” is well documented. They are social occasions, with lots of other people around,and this tends to increase your physiological arousal, an effect called social facilitation. As your adrenalinepumps, your heart beats faster, and your reactions quicken. This is ideal for something like sports, but makescool rational decision making harder. The very rich often send delegates to auctions, and as well as avoidingthe paparazzi I suspect this is also a strategy to combat the over-excitement induced by being physically present in the situation.On top of this, auctions are time pressured, and – by definition – you're bidding onsomething you value highly. These factors create excitement whether you are in the room or not.

Persuasive powers 

 Another psychological bias that operates in auctions is the endowment effect, where we tend to over-valuethings we already possess. By encouraging us to connect the bid (our money) with the sale item, bidding onitems lets us fantasise about owning them – stimulating a kind of endowment effect. This is why the auctioncatalogue (or the item picture and description on a website) is so important. This forms part of thepsychological journey the seller wants you to go on to imagine owning this item in advance, so you'll place a

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higher value on it, and so pay more to make imagination reality.Persuasion plays a huge part here, and the best book you can read on the psychology of the subject is Robert Cialdini's Influence. Cialdini is a Professor of Social Psychology at Arizona State University, and he lists six major ways you can make yourself persuasive. Auctions hit at least two of these six principles square on the nose.First, auctions use the principle of scarcity, whereby we overvalue things that we think might run out. Auction items are scarce in that they are unique(only one person can have it), and scarce in time (after the bids are finished, you've lost your chance). Think how many shop sales successfully rely on scarcity heuristics such as "Last day of sale!", or "Only 2 left instock!", and you'll get a feel for how powerful this persuasion principle can be.The other principle used by 

auctions is that of “social proof”. We all tend to take the lead from other people; if everybody does something,or says something, most of us join in before we think about what we really should do. Auctions put you inintimate contact with other people who are all providing social proof that the sale item is important and valuable.A final ingredient in the magic-spell cast by auctions was uncovered by researchers from Princeton.Their experiments asked volunteers to play on-line auctions with different rules. Some of these auctions hadrules that encouraged over-bidding (like typical open auctions, which most of us are familiar with frommovies), and some had rules that encouraged rational behaviour (like the eBay structure). With enoughguidance from the auction rules, the bidders didn't end up paying much more than they originally thought wasreasonable - but only if they thought they were bidding against a computer programme. As soon as the volunteers thought they were bidding against other live humans they found it impossible to bid rationally, whatever the auction rules.This implies that the competitive element of auctions is crucial to provoking our

irrational buying behaviour. Once we're involved in an auction we're not just paying to own the sale item, we'repaying to beat other people who are bidding and prevent them from having it. So it seems Gore Vidal hadhuman nature, and the psychology of auctions, about right when he said: "It is not enough to succeed. Othersmust fail."

21. Leonard Orban a căzut în groapa altuia la Bruxelles

Leonard Orban a primit aviz negativ de la Comisia pentru Controlul Bugetar a Parlamentului European.Respingerea candidaturii lui Leonard Orban pentru Curtea Europeană de Conturi putea fi evitată dacăpremierul Ponta nu ar fi dat curs autopropunerii acestuia, în detrimentul unui specialist. Ministrul

 Afacerilor Europene, Leonard Orban, a primit aviz negativ, miercuri, din partea Comisiei de control bugetar a Parlamentului European. După acest eşec, premierul Victor Ponta a ieşit la rampă, declarândcă Orban a fost „umilit din prostie şi la ordin politic de parlamentari PDL". Umilinţa lui Leonard Orban afost însă provocată chiar de premier. În mai 2012, după ce a ajuns la Palatul Victoria, Ponta a revocatnominalizarea făcută de Curtea de Conturi a României pentru acest post. Cel desemnat iniţial prin votulplenului Curţii de Conturi a fost vicepreşedintele instituţiei, Mircea Vasile Popescu. Fost procurorfinanciar inspector şi procuror general financiar al Curţii de Conturi a României, Popescu a fost 6 aniconsilier de Conturi. Din 2008, el este vicepreşedinte al Curţii de Conturi.Victor Ponta a preferat însă onumire politică şi l-a desemnat pe Leonard Orban, chiar la propunerea celui din urmă, potrivit unorsurse din conducerea Curţii de Conturi. Contactat de „Adevărul", Leonard Orban a recunoscut că s-ar fiautopropus. „A fost inclusiv dorinţa mea, dar decizia a fost strict la nivelul premierului", a declaratministrul. Reprezentanţa României la Bruxelles a remis, pe 10 februarie 2012, o adresă în atenţia

următorilor: Leonard Orban - ministrul Afacerilor Europene, Nicolae Văcăroiu - preşedintele Curţii deConturi, Ioan Aron Popa - preşedintele Autorităţii de Audit, şi Bogdan Aurescu - secretar de stat laMinisterul Afacerilor Externe. Documentul, semnat de Mihnea Motoc, şeful misiunii, descria paşii caretrebuie urmaţi în procedura de numire a unui nou reprezentant al României la Curtea Europeană deConturi. Adresa, care era însoţită de extrase din regulamentele de ordine şi proceduri ale Curţii Europenede Conturi, atrăgea atenţia în mod deosebit asupra condiţiilor pe care trebuie să le îndeplinească viitorulcandidat. „Condiţiile stipulate de TFUE, art. 286, prevede că membrii Curţii de Conturi sunt aleşi dintrepersonalităţile care fac parte sau au făcut parte din instituţii de control financiar extern sau care au ocalificare deosebită pentru această funcţie", se arată în document. Astfel, principalele criterii denominalizare agreate de Parlamentul European sunt: experienţa profesională în domeniul finanţelorpublice sau al auditului de management, „track-record" impecabil pe management, nedeţinerea unorfuncţii publice pentru care să fi fost necesare alegeri la data nominalizării, precum şi vârsta sub 65 de

ani.După primirea notei, Curtea de Conturi s-a reunit în plen pentru a alege un candidat. Ceinominalizaţi au fost Mircea Vasile Popescu şi Doina Dascălu, ambii vicepreşedinţi ai instituţiei, cuexperienţă incontestabilă în audit. În urma votului, plenul l-a desemnat pe Mircea Vasile Popescu(Hotărârea nr. 26/20.02.2012). Nominalizarea a fost transmisă Guvernului, iar premierul de la acea vreme, Mihai Răzvan Ungureanu, a validat propunerea. Ulterior, Curtea de Conturi a UE l-a programatla audieri pe Mircea Popescu. În mai 2012, la doar câteva zile de la schimbarea Guvernului, premierul

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 Victor Ponta a revocat însă nominalizarea. O notă seacă a Secretariatului General al Guvernului informaCurtea de Conturi despre această decizie: „Având în vedere că în România funcţionează un alt Guvern şisunt alte politici economico-financiare, se va lua măsura pentru retragerea nominalizării dlui. Mircea Vasile Popescu şi analizarea altor candidaturi".„Alte candidaturi" a însemnat, de fapt, una singură.Leonard Orban a fost desemnat de premierul Ponta pentru postul de la Luxemburg, fără canominalizarea sa să mai treacă prin plenul Curţii de Conturi. Deşi se spune că este un tehnocrat, LeonardOrban nu a ignorat niciodată „spatele politic". De altfel, Leonard Orban recunoscuse, anul trecut, că nueste apolitic, ci doar neînregimentat politic. În 2007, Orban a ajuns comisar european pentrumultilingvism la propunerea premierului Călin Popescu Tăriceanu.În 2010, după ce i-a expirat mandatul

de la Bruxelles, Leonard Orban a acceptat susţinerea PDL, Traian Băsescu numindu-l consilierprezidenţial în martie 2010. Ulterior, Emil Boc l-a adus în Executiv, ca ministru al Afacerilor Europene.Pentru a-şi păstra postul în Guvernul Ponta, Leonard Orban a primit girul conservatorilor. „În ceea cepriveşte prezenţa mea în Guvern, desigur că propunerea mi-a fost făcută de premier. Figurez, carepartiţie, pe unul dintre posturile care i-au fost repartizate PC", declara, în martie 2012, Leonard Orban.În chestionarul trimis Comisiei pentru Controlul Bugetar al PE, Leonard Orban a susţinut că areexpertiza necesară pentru a reprezenta România la Luxemburg. „În ceea ce priveşte auditul financiarextern, am avut o contribuţie substanţială la amendarea legii privind Curtea de Conturi a României (...),finalizarea manualului de audit financiar al Curţii de Conturi şi a Ghidului pentru auditul performanţei",menţionează Orban.Potrivit surselor din Curtea de Conturi, datele menţionate sunt cel puţin exagerate,Leonard Orban neavând cum să contribuie la aceste norme. Amendarea Legii Curţii de Conturi s-arealizat în 2008 de către o comisie prezidată de Pătru Rotaru, fostul preşedinte al Autorităţii de Audit.

De asemenea, finalizarea manualului de audit financiar al Curţii de Conturi şi a ghidului pentru auditulperformanţei s-a făcut, în 2009, de către auditori financiari din Departamentul nr. 1 al Autorităţii de Audit. În această perioadă, Leonard Orban era la Bruxelles, exercitându-şi mandatul de comisareuropean pentru multilingvism. Marcat de votul negativ primit la Bruxelles, Leonard Orban a refuzat sădiscute despre nominalizarea sa. „Nu vreau să fac niciun fel de declaraţii până nu voi lua o decizie desprece voi face în continuare. Atunci o să fac o declaraţie despre cum văd eu lucrurile, despre ceea ce s-a întâmplat. Până atunci, sub nicio formă nu doresc să discut", a declarat Leonard Orban pentru„Adevărul". La rândul rău, Mircea Vasile Popescu a refuzat să facă orice comentariu.

"Nu vreau să fac niciun fel de declaraţii până nu voi lua o decizie despre ce voi face în continuare.'' Leonard Orban candidat al României la Curtea Europeană de Conturi

Curtea de Conturi Europeană, care are sediul la Luxemburg, efectuează auditul finanţelor UE, jucândrolul de gardian independent al intereselor cetăţenilor Uniunii. Beneficiile postului sunt pe măsuraprestigiului acestei instituţii. Membrii săi, care au mandat pe 6 ani, deţin rang de ambasador, primesc unsalariu de 17.000 de euro şi au la dispoziţie propriul cabinet. Aceştia beneficiază de scutire de TVA latoate produsele achiziţionate din Uniunea Europeană. Pe lângă maşină de serviciu la dispoziţie,consilierilor Curţii li se decontează, lunar, două zboruri cu avionul la clasa business. De asemenea, soţiileşi copiii acestora beneficiază de indemnizaţii consistente.

22.“Gigantic" nu sună bine în rusă. Există o legătură între rezervele de gaze din Marea Neagrăşi isteria Moscovei?

Implicarea făţişă a Rusiei în conflictul politic care a paralizat,  vara aceasta, România nu mai are nevoie de nicio demonstraţie. Intraţi pe pagina de internet a radioului Vocea Rusiei, care recunoaşte cu mândrie că"modelează imaginea Rusiei în străinătate din 29 octombrie 1929 şi până azi" pe banii poporului sovietic şiulterior ai celui rus şi o să găsiţi zeci de texte în care liderii USL erau fie criticaţi pentru "defetismul" de care audat dovadă în lupta contra lui Băsescu, fie aplaudaţi pentru contraofensive, fie lăudaţi pentru curajul de a da depământ cu europenii Barroso, Merkel, Reding sau americanii Gitenstein şi Gordon. Toate semnate de românulneaoş "Valentin Mândrăşescu". Singura întrebare rămasă relativ în umbră este dacă Rusia a pus la bătaie nudoar condeiul lui Mândrăşescu, ci şi ceva ruble pentru a susţine victoria puciştilor împotriva instituţiilor care,luptându-se pentru revenirea lui Băsescu la Cotroceni, s-au luptat, de fapt, pentru propria supravieţuire. Însăchiar şi acest detaliu este irelevant. Pe bani sau din convingere, cei care, mânaţi de la spate de propaganda

străvezie a  Sluzhba Vneshney Razvedki , principalul serviciu de spionaj de la Moscova, au demonizatparteneriatele României cu Uniunea Europeană şi Statele Unite şi i-au transformat pe liderii vestici înprincipalii inamici ai ţării au făcut pe deplin jocul unui Rusii din ce în ce mai frustrate că istoria trece pe lângăea. Întrebările esenţiale la care nu s-a răspuns încă încep cu "de ce?". De ce a renunţat Kremlinul să-şifolosească doar agenţii săi de influenţă care, discret, dar eficient, nu vorbesc de bine Rusia, dar ne amintescconstant, din 22 decembrie 1989 încoace, de când au răsărit miraculos în studiorile TVR sau în redacţia

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Scânteii, îmbrăcaţi în puloverele revoluţiei, cât de ticălos este Occidentul, că nu ne vrea decât răul şi căRomânia ar trebui să se uite şi spre Est pentru parteneriate cu adevărat avantajoase?De ce a ieşit la atac, cusurle şi trâmbiţe? De ce acum? De ce simte nevoia ca numele să-i fie pronunţat public de către politicieni carei-ar servi mai bine interesul dacă s-ar achita de obligaţii pe tăcute? Şi ce are, la urma urmei, de câştigat prindestabilizarea României? În primul rând, pentru că vrea să ştie că are o contribuţie la ce se întâmplă aici. Estesemnătura clasică, brutală, a Rusiei pe declaraţia prin care reaminteşte Occidentului că nimic important nu semişcă în această parte a lumii fără aprobarea sa. De ce acum? Pentru că, din punctul ei de vedere, lucrurile auajuns mult prea departe. Iar vremea ripostei politicoase a trecut. Suntem din nou într-un moment în careRusia bate cu pumnul în masă. Nu Stalin se află la Kremlin, ci Putin, iar pumnul nu îi aparţine lui Vişinski, ci

lui Rogozin. Criza de orgoliu a Moscovei are legătură directă cu Bucureştiul - considerat vinovat de crimacapitală de a fi acceptat scutul antirachetă american pe teritoriul său - dar şi cu vesticii, care continuă să înainteze spre spaţiul său vital, spre Moldova şi chiar Transnistria. Ori, asta nu este dispusă să accepte nici înruptul capului. Strategia rusească pentru contraatac: să împingă linia frontului, în războiul geopolitic, cât maideparte de graniţele sale, înspre teritoriul pe care îl consideră ocupat deja de inamic - România.După ani întregi de nepăsare, conflictul îngheţat de pe Nistru a revenit în atenţia Vestului. Din 2009, maiprecis după revoluţia "Twitter" de la Chişinău, o dată cu victoria în alegerile din Moldova a Alianţei pentruIntegrare Europeană, care a detronat Partidul Comunist. De atunci încoace, după cum remarcă experţii NicuPopescu şi Leonid Litra în analiza lor "Transnistria: o soluţie de jos în sus", "Moldova a ajuns să fie privită ca opoveste de succes a Parteneriatului Estic al Uniunii Europene - o impresie amplificată şi de comparaţia cuUcraina, care a regresat, ajungând la un îngheţ în relaţia cu UE". Deşi pentru majoritatea românilor a trecutneobservată, evoluţia în direcţia integrării este atât de spectaculoasă încât preşedintele Comisiei Europene,

José Manuel Barroso, a declarat la începutul acestei luni că Moldova ar putea încheia anul viitor negocierile pemarginea acordurilor de asociere cu Uniunea Europeană. Cum a răspuns Rusia aspiraţiilor europene aleMoldovei? Cu o nouă combinaţie de ameninţări şi promisiuni, în stilul caracteristic. A promis o scădere cu 30la sută a preţului la gaze dacă Chişinăul revocă protocolul de adoptare a celui de-al Treilea Pachet Energetic, pecare l-a semnat în calitate de membru al Comunităţii Energetice Europene.Ce ar câştiga Rusia din asta? Nimic.Dar ar duce la întreruperea negocierilor privind un alt demers care va apropia Moldova şi mai mult de UniuneaEuropeană - instituirea Zonei de Liber Schimb Aprofundată şi Cuprinzătoare - şi, implicit, la blocarea semnării Acordului de Asociere. În paralel, Rusia şi-a arătat mărinimia şi a permis creşterea importurilor de vin şiproduse agricole, însă sub rezerva că autoritatea pentru protecţia consumatorilor de la Moscova poate limitaoricând doreşte aceste tranzacţii, pe termen nelimitat. O condiţionare-avertisment care a transmis oamenilorde afaceri moldoveni că profiturile lor din comerţul cu Rusia vor fi tăiate de îndată ce acţiunile politicienilor dela Chişinău îi vor nemulţumi. O altă ameninţare este legată de un eventual refuz de a accede în Uniunea

 Vamală a Comunităţii Economice Euroasiatice. Dacă Moldova nu va aplica pentru intrarea în proiectul princare Putin încearcă să creeze o contrapondere la Uniunea Europeană şi din care fac parte deocamdată doarRusia, Belarusul şi Kazahstanul, consecinţele ar putea fi serioase. Locurile de muncă ale celor 300.000 demoldoveni care lucrează în Rusia vor fi puse sub semnul întrebării şi o dată cu ele şi sumele importante de banipe care aceştia le trimit acasă, care alcătuiesc, cumulat, 8% din Produsul Intern Brut. Strategia Rusiei faţă deMoldova are ca pivot central Transnistria. Kremlinul încearcă de zece ani să determine Chişinăul să accepte oreunificare pe picior de egalitate cu republica separatistă pe care o subvenţionează. Planul final: crearea uneirepublici federale în care autonomia Moldovei să fie subminată de calul său troian de la Tiraspol, blocareaparcursului european al Chişinăului şi, în final, integrarea în Uniunea Euroasiatică. Spre disperarea Moscovei,planul său nu a funcţionat până acum. Ba chiar a luat o turnură neaşteptată. Transnistria nu doar că nureuşeşte să smulgă Moldova de pe orbita proeuropeană, dar pare că trage din ce în ce mai mult cu ochiul la beneficiile pe care le-ar avea dacă s-ar alătura şi ea Uniunii Europene. Măcar şi parţial, prin aderarea la Zona

de Liber Schimb. Confirmarea eşecului politicii ruseşti în Transnistria a venit anul trecut, când candidatulsusţinut de Moscova pentru funcţia de preşedinte a pierdut alegerile. Deşi Anatoliy Kaminski, omul propulsatpentru a-l înlocui pe Igor Smirnov, a beneficiat de o finanţare masivă asigurată de prietenii intimi ai lui Putin,care controlează cele mai importante companii din Transnistria, şi a defilat cu afişe cu chipul ţarului de laKremlin şi cu tricouri pe care scria "Sprijinit de Rusia", a reuşit să iasă pe locul doi. Victoria i-a revenit luiEvgheni Şevciuk, care a candidat ca independent. Şi deşi noul preşedinte al Transnistriei nu are nici o şansă dea rămâne independent faţă de Rusia, care plăteşte direct toate cheltuielile republicii separatiste, relaţia sa cuputerea de la Moscova este, cel puţin deocamdată, departe de a fi atins gradul de servilism din cei 20 de ani dedomnie ai lui Igor Smirnov.De la începutul anului, Şevciuk a făcut mai multe vizite la Chişinău, unde s-a întâlnit neoficial cu premierul Moldovei, Vlad Filat. Cei doi au agreat intensificarea dialogului pentrusoluţionarea conflictului dintre cele două părţi, în formatul 5 + 2 (Republica Moldova, Transnistria, Rusia,Ucraina şi OSCE, precum şi UE şi Statele Unite ca observatori), precum şi implementarea câtorva măsuri cu valoare mai mult simbolică: reluarea transportului feroviar de mărfuri, refacerea conexiunilor telefonice şideschiderea unui pod.  Cel mai important pas urmărit este implicarea oficialilor transnistreni în dialogulMoldova-UE pentru comerţ liber.Cu toate acestea, şansele ca Moscova să renunţe la planurile sale de a face dinTransnistria calul troian pentru transformarea Moldovei în republică federală şi atragerea ei în UniuneaEuroasiatică nu doar că nu au crescut, dar sunt în continuare aproape egale cu zero. Cea mai bună dovadă:

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Rusia refuză în continuare orice discuţie despre retragerea trupelor sale de pe teritoriul Transnistriei. Maimult, la nici două săptămâni după realegerea sa ca preşedinte, în această primăvară, Putin a creat un nou post,de reprezentant special pentru Transnistria, şi l-a desemnat în această funcţie pe nimeni altul decât DmitriRogozin, cel mai naţionalist şi vehement antioccidental diplomat rus. Cel care a lansat pe Twitter unavertisment către "SUA şi aliaţii lor", promiţând că "ursul rus le va da un şut în fund" dacă încearcă să-l încolţească, referindu-se la instalarea sistemului american antirachetă în Europa de Est.Această numire a fosturmată şi de alte gesturi care au semnalat că Putin este decis să nu lase Moldova din mâini. A numit, pe 5aprilie, un nou ambasador la Chişinău, înlocuindu-l pe Valeri Kuzmin, cel care s-a făcut remarcat prinnumeroase declaraţii provocatoare şi chiar iresponsabile la adresa moldovenilor, cu Farit Mukhametshin, un

expert în "soft power", fost şef al Agenţiei care se ocupă de CIS, comunitatea fostelor state sovietice.Interesulrenăscut brusc faţă de Moldova s-a concretizat şi printr-o vizită în premieră a ministrului Apărării, Anatoliy Serdyukov, în Transnistria, pe 12 aprilie, dar şi printr-o vizită a lui Rogozin la Chişinău şi Tiraspol, pe 16-17aprilie.Toate aceste mutări la un loc, dar în special numirea lui Rogozin, un diplomat care s-a exprimat răspicat în trecut în favoarea acordării independenţei Transnistriei, reprezintă semne clare că strategia lui Putin înaceastă regiune este jocul în forţă.Posturi similare cu cel de reprezentant al preşedintelui în Transnistria aufost create şi în Abhazia şi Osetia de Sud, ceea ce i-a făcut pe mulţi experţi să bănuiască o strategie de a punepresiune pe celelalte ţări din formatul 5 + 2 prin sugerarea faptului că Rusia ia în calcul o soluţie "caucaziană". Adică o recunoaştere formală a independenţei republicii separatiste Transnistria. Scopul: să-i oblige peamericani şi europeni ca, de teama prelungirii conflictului, să accepte o soluţie de federalizare a Moldovei şichiar păstrarea trupelor sale pe teritoriul ei.În ciuda declaraţiilor belicoase ale lui Rogozin însă, planul Rusieiar putea eşua dacă Moldova rezistă promisiunilor şi şantajului. Ceea ce s-a întâmplat din aprilie încoace arată

că, deocamdată cel puţin, Moldova rezistă. Iar această poziţie are legătură şi cu România. Poate în primul rândcu România.După prima întâlnire cu noul ambasador rus, preşedintele Moldovei, Nicolae Timfoti, a precizatclar răspunsul său la şantajul energetic: "Avem nevoie de gazul natural rusesc şi de curentul electric care vindin est. Dar România este gata să ne ajute în această privinţă. Dacă adoptăm politicile adecvate, nu o să maitrebuiască să depindem atât de mult de Federaţia Rusă".O astfel de declaraţie ar fi fost de neconceput chiar şiacum doi ani. În timp ce numeroşi politicieni români se întrec în a ataca Occidentul pentru a fi lăudaţi de Vocea Rusiei, preşedintele Moldovei, o ţară mult mai vulnerabilă decât a noastră, nu ezită să înfrunte directRusia, invocând sprijinul fraţilor de peste Prut.Chiar dacă România a făcut numeroase greşeli în relaţia cuMoldova, iar sprijinul pe care ar fi trebuit să-l acordăm nu s-a ridicat de cele mai multe ori la nivelul misiuniiistorice pe care ar fi trebuit s-o îndeplinească, ar fi nedrept să nu credităm diplomaţia noastră, dar şi specialiştidin alte domenii cu care a colaborat, pentru meritul de a susţine demersul european al basarabenilor.Dacăpentru cetăţeanul de rând nu este nici acum evident, liderii de la Kremlin au înţeles de mult că, atât timp cât

România rămâne consecventă parteneriatelor strategice cu UE şi SUA, este doar o chestiune de timp până ceMoldova i se va alătura.Şi chiar dacă Rogozin (cel care a spus că ideile naziste încă există în Europa, pentru căsunt lăudate de unii politicieni precum Traian Băsescu) a fost numit pentru a ne face să credem că Rusia ia încalcul la modul serios ruperea oficială a Transnistriei şi transformarea ei în bază militară la graniţa cuOccidentul imperialist, este evident că o astfel de variantă ar reprezenta o înfrângere pentru Putin.Drepturmare, singura strategie acceptabilă pentru Moscova este deraierea parcursului proeuropean al Moldoveidupă modelul Ucrainei. Doar că, pentru a deraia Moldova, Rusia trebuie să deraieze mai întâi România, să otransforme din nou în ţara fără busolă pe care a dirijat-o cum a vrut în anii de glorie ai lui Ion Iliescu. Ceea ceaproape că era să reuşească. Graţie unei adunături de politicieni iresponsabili, care şi-ar vinde şi părinţiipentru bani şi funcţii.Nu are nici o importanţă dacă Rusia a finanţat sau a iniţiat ofensiva USL împotrivainstituţiilor care garantează relaţia cu Occidentul. Şi dacă a fost un asalt gândit de politicienii de la Bucureşti,iar Rusia doar i s-a alăturat de pe margine, cu o portavoce în mână, vulnerabilizarea ţării prin compromiterea

legăturilor cu aliaţii vestici şi crearea unei breşe ca Moscova să devină din nou o voce în spaţiul românesc suntla fel de grave ca un act de trădare. O Românie măcinată de conflicte interne şi probleme economice este oRomânie care nu îşi va mai putea urmări eficient obiectivele de politică externă, dintre care viitorul alături deMoldova este cel mai important. Rusia nu îşi poate dori nimic mai mult.Şi poate exact aceste dorinţe au făcutobiectul discuţiilor neoficiale pe care Liviu Dragnea le-a purtat cu ambasadorul Rusiei la Bucureşti, la sediulPSD, în zilele în care liderul de faţadă al partidului, Victor Ponta, era plecat în Africa de Sud.Nu în ultimulrând, mai există un motiv care ar putea explica implicarea isterică a Rusiei în politica României: gazele şipetrolul din Marea Neagră. Când au fost făcute primele estimări ale rezervelor, înainte de începerea procesuluide la Haga pentru delimitarea platoului continental, acestea erau estimate la 100 de miliarde de metri cubi.Estimări care au fost deja depăşite de realitate.Doar forarea unui singur puţ, Domino-1, amplasat în bloculNeptun, a scos la iveală zăcăminte estimate preliminar între 40 şi 80 de miliarde de metri cubi. Ceea ce înseamnă între 10 şi 20 de ani de independenţă faţă de gazul rusesc.Ce se întâmplă dacă se confirmă predicţiilegeologilor, care spun că Domino-1 nu este nici pe departe cel mai mare zăcământ din Marea Neagră şi că maiexistă altele, mult mai bogate?Dacă sunteţi sceptici, vă invit să citiţi interviul acordat de Gerhard Roiss, CEO alconcernului OMV, revistei germane "Manager" (fragmentele relevante au fost publicate în "România liberă").Întrebat despre dimensiunea rezervelor de gaze şi petrol descoperite în Marea Neagră, Roiss a folosit un cuvântdestul de neobişnuit pentru un om în poziţia sa, obligat permanent să-şi măsoare cu grijă vorbele: "gigantice",

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"o descoperire de importanţă mondială".Mai mult decât atât, Roiss a prezentat noul concept al proiectuluiNabucco din punctul de vedere al OMV: "Nabucco trebuie să se subordoneze nevoilor noastre strategice.Interesul nostru este să obţinem o rută de transport pentru gazul din Marea Neagră. Cu cantităţi adecvate vomputea alimenta Nabucco...".Pentru cei ce nu sunt familiari cu istoria acestei rute de transport a gazelor menităsă reducă dependenţa faţă de importurile din Rusia trebuie spus că ea a fost gândită pentru a aduce gaze dinMarea Caspică în special. Faptul că şeful OMV aduce în discuţie posibilitatea ca Nabucco să fie alimentat şi cugaze din Marea Neagră reprezintă o schimbare totală de paradigmă. Una care include posibilitatea ca Româniasă devină nu doar independentă energetic, dar şi exportator de hidrocarburi.Ce ar mai rămâne din jocul laşantaj cu gazele al Rusiei, dacă o altă ţară, condusă de politicieni responsabili, ancorată şi mai puternic în

parteneriatele strategice prooccidentale, devine principala sursă de gaze a Europei? Nu poate fi acesta unscenariu de coşmar pentru liderii de la Kremlin, unul care să justifice nevoia de a împiedica cu orice preţRomânia să rămână în afara sferei lor de influenţă şi să devină o forţă regională?

23. Fondul britanic Carpathian a vândut şi ultimul teren pe care îl deţinea în România, la BaiaMare

Fondul britanic de investiţii Carpathian a ieşit de pe piaţa românească, unde intenţiona să dezvolte mai multecentre comerciale, după ce şi-a vândut participaţia şi la ultimul teren pe care îl deţinea în România, în BaiaMare, potrivit  Mediafax.Odată cu vânzarea proprietăţii din România, fondul a renunţat la toate activele

deţinute în Europa Centrală şi de Est, cea mai mare parte a banilor obţinuţi fiind returnaţi acţionarilorCarpathian."Grupul şi-a vândut participaţia deţinută la proprietatea din Baia Mare pentru 300.000 de euro",se arată într-un raport al companiei.Terenul a fost achiziţionat în anul 2007 şi are o suprafaţă de aproape60.000 de metri pătraţi, iar la cumpărare era evaluat la 6,5 milioane de euro. Pe acest teren ar fi trebuit să fieconstruit un centru comercial prin intermediul firmei Atrium Centers. Anul trecut, terenul era evaluat la 3milioane de euro.Aceasta era ultima proprietate deţinută de fondul de investiţii în România, după ce anultrecut a vândut centrul comercial Macromall Braşov şi un teren din Satu Mare cu 2,1 milioane deeuro.Anterior, în 2010, Carpathian a vândut participaţia deţinută la mall-ul Atrium Center Arad, şi a renunţatla cota de participare la un proiect din Cluj-Napoca, unde ar fi urmat să fie dezvoltat tot un centru deretail.Carpathian a ieşit astfel cu o imensă pierdere de pe piaţa românească având în vedere că a cumpăratMacromall cu 19 milioane de euro şi l-a vândut cu un milion de euro, iar pe terenuri, unde nu a mai reuşit săconstruiască proiectele anunţate înainte de criză, a reuşit să recupereze doar o parte foarte redusă din banii

investiţi în urmă cu 5 ani.Compania Carpathian a fost înfiinţată în 2005 având ca obiect de activitateinvestiţiile în Europa Centrală şi de Est.

24.Vrei credit avantajos? apucă-te de agricultură!

Bancherii susțin că afacerile mai mari sau mai mici din agricultură reprezintă domeniul predilect al creditării în acest an, mai ales că diversificarea portofoliului de produse a atras și creșterea celui de clienți. Cele maimari bănci din România mizează chiar pe o majorare a expunerilor, susținând că rata neperformanței pentruacest sector nu creează probleme, cel puțin în acest moment.Pe fondul dezintermedierii, care a marcat înspecial vedeta incontestabilă din perioada anterioară crizei - segmentul de retail, băncile caută noi ni șe viabilepentru finanțare, pentru a-și compensa neperformanța și, implicit, pierderile. În acest context, președintele Asociației Române a Băncilor, Radu Ghețea, consideră că, în 2012, agricultura reprezintă o țintă a interesuluiinstituțiilor de credit, mai ales că este un domeniu care se întrepătrunde direct cu derularea fonduriloreuropene. De altfel, cele mai recente date publicate de Banca Națională arată o creștere continuă a ponderii împrumuturilor pentru agricultură în totalul soldului corporate. Practic, dacă la finalul anului 2007 acestecredite reprezentau 3,4% din totalul finanțărilor acordate firmelor, la sfârșitul anului trecut proporția urcase la5,8%. În plus , tendința se menține și pe parcursul acestui an, la finalul lunii mai expunerea crescând la 6%. Pede altă parte, apetitul în creștere al băncilor pentru acest sector se observă și din faptul că soldul împrumuturilor pentru agricultură a crescut anual de două ori mai repede decât cel total al finanțărilorcorporate.Sigur , dacă ne raportăm la mediile lunare, situația este oarecum diferită, dar acest lucru trebuieanalizat prin prisma faptului că solicitările de credite pentru agricultură sunt caracterizate de sezonalitate. Aceasta este determinată, spun reprezentanții BRD, de calendarul lansărilor de către APIA a diverselor formede sprijin, de deschiderea sesiunilor de finanțare în cadrul Programului Național de Dezvoltare Rurală și, nu înultimul rând, de perioadele specifice campaniilor agricole.

7 motive care frânează finanțarea

Fără doar și poate, agricultura românească este rudimentară, cu un nivel slab de mecanizare și cu sistemele deirigații învechite, fapt care plasează țara noastră pe ultimele locuri din Uniunea Europeană la acest capitol. Vestea bună este că, în acest context, băncile simt potențialul uriaș al afacerilor pe care le-ar putea derula prin

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finanțarea acestui sector.Totuși, se pare că soldul total al creditelor acordate agriculturii, de 10,2 miliarde delei la finalul lunii mai, nu reprezintă un nivel  acceptabil pentru bancheri.Dincolo de creșterea exigenței înanaliza proiectelor propuse la finanțare, aceștia spun că există o serie de dificultăți care stau în calea uneifinanțări mai facile. O parte dintre acestea provin de la clienți, iar cealaltă, din însăși caracteristica mediului deafaceri românesc.„De exemplu, planurile de afaceri care ni se propun spre finanțare nu cuprind evaluareacorectă a pieței targetate, identificarea clienților potențiali, ori nu conțin bugete de venituri și cheltuieli sauproiecții financiare realiste. Alte greutăți care frânează creșterea creditării provin din lipsa lichidităților sau acontribuției proprii la afacere și a identificării unor garanții acoperitoare pentru bancă”, spune EmilianCroitoru, director adjunct al rețelei Corporate din cadrul BCR.Potrivit acestuia, mai apar și probleme legate de

 încasarea facturilor emise de clienți, care influențează negativ cash flow-ul companiilor, și de obținerea cu întârziere a subvențiilor primite de la stat. Pe de altă parte, mai punctează oficialul BCR, nivelul cunoștințelorfinanciare ale jucătorilor din acest domeniu este relativ scăzut.

Cu toate acestea, agricultura rămâne unul dintre sectoarele pe care BCR mizează în 2012.

„Aproximativ 10% din expunerea existentă pe segmentul de clienți corporate a fost acordată în relație cudomeniul agricol: cultura plantelor, viticultura, zootehnia sau piscicultura”, arată Emilian Croitoru, careprecizează că, în contextul unui an dificil din toate punctele de vedere, banca și-a menținut expunerea peclienții din domeniul agricol, astfel încât acordările noi de credite au reușit să acopere rambursările celor aflate în sold. „Finanțările solicitate în acest domeniu depășesc media clienților corporate de pe segmentul IMM”,conchide directorul adjunct al rețelei Corporate. Unul dintre competitorii importanți din acest sector ai BCR 

rămâne CEC Bank. Orientarea puternică și de durată în creditarea agriculturii i-a permis celei mai mari băncide stat din România să ajungă la o pondere a creditelor pentru sectorul agricol în totalul celor acordatepersoanelor juridice de 16,74%.„Finanțarea agriculturii reprezintă una dintre țintele noastre strategice.Limitele stabilite în strategia de risc a băncii în ceea ce privește expunerea pe sectorul agricol permitfructificarea în continuare a oportunităților de piață pe acest segment și, implicit, majorarea expunerii”,explică reprezentanții CEC Bank.De altfel, bancherii constată că, odată cu diversificarea portofoliului deproduse dedicate sectorului agricol, a avut loc o intensificare a cererii de credite din partea companiilor ceactivează în mediul rural. „Constatăm o creștere a apetitului pentru finanțare, inclusiv în domeniulinvestițiilor, al înființării, întreținerii și recoltării culturilor agricole și, mai ales, pentru co-finanțareaproiectelor din fonduri europene”, spun reprezentanții BRD.

Surprinzător, dar în ceea ce privește neperformanța, bancherii nu prezintă un grad de nervozitate ridicat.

Dimpotrivă. „Prin comparație cu alte sectoare, cum ar fi comerț, imobiliare, construcții sau transporturi , ratade credite neperformante este mai redusă în agricultură, indiferent de segmentul de clientelă”, arată BRD.Unadintre explicații este, fără îndoială, și faptul că, în 2011, anul agricol a fost unul bun, dar seceta din acest an arputea să modifice perspectiva cu 180 de grade.„Având în vedere previziunile nu foarte optimiste din sectorulculturilor agricole, am putea asista la o creșterea a ratei creditelor neperformante în acest domeniu”, adaugă bancherul de la BCR.

Când vine însă vorba despre costuri, bancherii spun că acestea depind de bonitatea solicitantului.În cazul BCR,gradul de risc este determinat de situațiile financiare ale clienților și de subdomeniul în care aceștia activează.La rândul ei, CEC Bank practică o dobândă de bază (Prime Rate), la care adaugă o marjă stabilită în funcție deperformanța financiară a solicitantului sau de termenul solicitat. Orientativ, pentru finan țarea activitățilorcurente ale beneficiarilor schemei de plată unică pe suprafață, CEC Bank practică pentru lei o dobândăcuprinsă între 9,4% și 9,9%, în funcție de clasa de performanță financiară în care se încadrează clientul,comisionul de gestiune, aplicat la valoarea acordată și perceput la acordarea creditului, fiind de 0,25%.

Ministerul Agriculturii o lansat o solicitare băncilor de a oferi fermierilor beneficiari ai schemelor de sprijinderulate de cele două agenții de plăți, APIA și Agenţia de Plăţi pentru Dezvoltare Rurală şi Pescuit, finanțări cudobânzi mai mici decât cele acordate celorlalți jucători din industria românească. Patru bănci, CEC Bank, BCR,Banca Transilvania şi BRD, sunt interesate de acest proiect, prima realizând deja chiar și o ofertă. CEC Bank vareduce dobânda cu un punct procentual la creditele acordate pentru realizarea proiectelor cu componentă dinfonduri europene, în cadrul PNDR.Totodată, gradul minim de acoperire cu garanții va fi redus cu aproximativ 15%, comparativ cu creditele standard acordate persoanelor juridice, iar avansul minim va scădea la 10% din valoarea proiectului, pentru companiile de tip start-up.Potrivit ministrului de resort, Daniel Constantin,creditele vor fi destinate fermierilor care nu au surse proprii pentru cofinanțare, iar convențiile vor fi semnatecu instituțiile financiare care vor prezenta cele mai avantajoase oferte de creditare pentru beneficiariiproiectelor europene.În paralel, Ministerului Agriculturii va înfiinţa și un fond de creditare din fonduri dedezvoltare rurală, tot în parteneriat cu băncile. Pe de o parte, finanțările vor fi destinate fermierilor care nu aufonduri necesare pentru cofinanțare, iar pe de alta, celor care nu au sume suficiente pentru a începe investiţia.Ministrul Agriculturii a explicat că fondurile vor fi puse la dispoziţia băncilor, iar acestea vor acorda creditele în condiţii speciale.

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Pentru a facilita accesul la finanțare al solicitanților, 28 de bănci și IFN-uri au încheiat convenții cu Fondul deGarantare al Creditului Rural, atât pentru împrumuturile destinate producției, cât și pentru cele de investiții.

Potrivit instituției, valoarea totală a garanțiilor acordate a fost de 1,7 miliarde de lei (+60,6%), aferentă unui volum de credite de 2,2 miliarde de lei (+44,5%). De exemplu, convențiile de colaborare încheiate de BRD cuFGCR acoperă prefinanțarea subvențiilor APIA, creditele destinate finanțării capitalului de lucru pe termenscurt și cele acordate pentru proiecte de investiții, cu sau fără componentă de fonduri europene.În ceea ceprivește BCR, convențiile bilaterale de garantare pentru subvențiile APIA au ca obiect pentru campania 2012:Schema de plată unică pe suprafață, Schema de plăți naționale directe complementare pentru suprafețe

cultivate cu tutun, Schema de sprijin pentru măsurile de agromediu și zone defavorizate - Axa II PNDR, Plățilenaționale directe complementare în sectorul zootehnic bovine și ovine/caprine.Totodată, banca negociază înaceastă perioadă și o convenție de garantare privind Schema de plăți pentru bunăstarea păsărilor șiporcinelor. Pe de altă parte, între BCR și Fondul de Garantare a Creditului Rural există o convenție de lucru înscopul garantării creditelor acordate, în sectorul agricol, procesatorilor, precum și beneficiarilor de fondurieuropene din acest domeniu.În ceea ce privește CEC Bank, parteneriatul cu FGCR acoperă toate tipurile definanțări cu specific agricol, precum linii de credit și împrumuturi pentru investiții, credite punte pentru platasubvențiilor agricole - la hectar, în zootehnie, agromediu, bunăstare păsări și porci și pentru beneficiarii dinzonele defavorizate.Potrivit bancherilor, creditele de prefinanțare a subvențiilor ce urmează a fi încasate de la Agenția de Plăți și Intervenție în Agricultură sunt cele mai ușor de accesat, pentru că presupun o analizăsimplificată, iar acordarea finanțării se realizează doar în baza prezentării adeverinței APIA și a constituiriigaranțiilor aferente. De exemplu, la CEC Bank, termenul de răspuns al băncii la astfel de solicitări este de

maximum două zile lucrătoare de la prezentarea adeverinței.CELE MAI SOLICITATE FINANȚ ĂRI AGRICOLE

Într-un top sui generis al celor mai solicitate finanțări, primele locuri sunt ocupate de:

- prefinanțarea subvențiilor APIA;

- înființarea, întreținerea și recoltarea culturilor agricole;

. finanțarea investițiilor, precum achiziția de utilaje agricole, terenuri, mijloace de transport specifice sauanimale.

Reprezentanții BRD spun că o cerere crescută de credite a fost înregistrată și din partea beneficiarilor eligibilila finanțare prin Programul Național de Dezvoltare Rurală, iar cei ai BCR au remarcat în plus un apetit încreștere al fermierilor pentru finanțarea activităților curente de producție agricolă, cum ar fi cele destinate înființării culturilor agricole.

25. De ce sunt ingrijorate SUA in privinta Romaniei

Philip Gordon, adjunctul secretarului de stat al SUA, Hillary Clinton, a declarat că este la curent cu intenţiileunor politicieni de a organiza un nou referendum pentru a-l înlătura pe preşedintele Traian Băsescu, însă

trebuie respectate procedurile constituţionale."În mod clar, continuăm să urmărim România foarte strâns. Ştiucă unii în România se gândesc să organizeze un alt referendum, găsind astfel alte metode de a-l înlătura pepreşedinte. Trebuie subliniat din nou că trebuie respectate procedurile constituţionale. Dacă preşedintele estenepopular, iar mandatul său nu reflectă voinţa populară, atunci alegerile libere şi corecte sunt modul încare trebuie adresată aceasta. Şi dacă acesta este modul prin care România va merge mai departe, cred căcredibilitatea sa ca o democraţie puternică şi partener al SUA va continua să crească", a afirmat oficialul SUA.Declaraţia sa a fost făcută într-un briefing de presă la sfârşitul săptămânii trecute, răspunzând unei întrebări aunui jurnalist român despre ce ar trebui să facă România în  viitor pentru a-şi recâştiga  încrederea şi dacă Washingtonul mai este îngrijorat cu privire la situaţia din România."Îngrijorările noastre în acest cazparticular au avut de-a face, aşa cum bine ştiţi, cu eforturile de a schimba rezultatele aparente alereferendumului de demitere a preşedintelui. Am fost şi suntem foarte atenţi să nu interferăm în afacerileinterne ale României, însă am vrut să fie clar că lumea, comunitatea internaţională, nu va considera legitimă

schimbarea procedurilor de vot după desfăşurarea referendumului şi în contradicţie cu ceea ce CurteaConstituţională a hotărât. Am subliniat importanţa respectării oricărei decizii a Curţii Constituţionale, iaracesta a fost testul credibilităţii democraţiei din România. Şi sunt mulţumit că pot spune că aceasta este ceea ceşi guvernul a făcut în cele din urmă. Cu toate că am auzit despre posibile fraude ale votului şi deliberări despreun potenţial refuz de a accepta hotărârea Curţii Constituţionale, Curtea a decis, listele de votanţi care au fostfolosite au fost respectate, iar preşedintele suspendat a fost reinstaurat conform statului de drept. Iar acesta

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este rezultatul corect", a argumentat Gordon.De asemenea, el a arătat că aceste evoluţii pot fi interpretate caindicând că în România este o democraţie matură, ceea ce reprezintă un "lucru foarte pozitiv ". "Şi în acestsens, cred că este probabil corect să afirm că România a câştigat credibilitate în ochii Statelor Unite, cred căşi în ochii partenerilor europeni, prin respectarea statului de drept, chiar şi atunci când aceasta contraveneaintereselor pe termen scurt ale celor care deţineau puterea în acea perioadă tranzitorie. Cred că acesta este unsemn al unei democraţii mature şi cred că este un lucru foarte pozitiv", a afirmat Gordon.OficialulDepartamentului de Stat declara şi în urmă cu o săptămână că Administraţia SUA este mulţumită de faptul căGuvernul de la Bucureşti îşi menţine angajamentul de a respecta deciziile Curţii Constituţionale. "În România,ne-am exprimat îngrijorările privind ameninţările la adresa instituţiilor democratice şi independenţa

sistemului judiciar. Am fost în mod particular îngrijoraţi cu privire la modul de desfăşurare a referendumuluide demitere a preşedintelui (Traian Băsescu - n.r.), deoarece Guvernul a părut că schimbă regulile în timpulprocesului şi erau acuzaţii credibile de fraudă la vot şi încercări de constrângere a Curţii Constituţionale.Suntem mulţumiţi să vedem că Guvernul îşi menţine angajamentul de a respecta deciziile CurţiiConstituţionale. Avem speranţa că România va depăşi această criză cu un angajament reînnoit pentrumenţinerea puterii şi independenţei instituţiilor sale democratice", a afirmat Gordon, într-un discurs rostit laun forum despre Europa Centrală desfăşurat la Washington DC.De asemenea, Gordon a evidenţiat că alianţaSUA cu ţările Europei Centrale are rădăcini şi în angajamentul comun de a respecta valorile democratice."Deoarece alianţa noastră este bazată pe aceste valori comune, nu am avut rezerve de timiditate în a amintipartenerilor noştri de obligaţiile lor de a promova şi proteja principiile democratice", a mai spus Gordon.PhilipGordon, asistent al secretarului de stat american, Hillary Clinton, a făcut în 13 august o vizită la Bucureşti,"pentru a discuta despre îngrijorarea Statelor Unite în legătură cu ultimele acţiuni guvernamentale care

ameninţă separarea democratică a puterilor în stat şi slăbesc independenţa instituţiilor statului". El a avut întâlniri cu Traian Băsescu, suspendat din funcţie la acea vreme, cu preşedintele interimar de atunci, Crin Antonescu, cu premierul Victor Ponta, dar şi cu reprezentanţi ai societăţii civile.La finalul vizitei, PhilipGordon a declarat că SUA susţin cele 11 puncte redactate de CE la adresa autorităţilor de la Bucureşti,precizând că a auzit "ceea ce trebuia" de la oficialii români cu care a discutat, rămânând de văzut dacă aceştia vor respecta ce au spus. "Am venit şi pentru a exprima aceste preocupări. Au existat, aşa cum se ştie, acuzaţiicredibile de vot ilegal masiv la referendum, au fost demersuri de schimbare a listelor cu votanţi, care arschimba cvorumul de vot şi, se pare, încercări de presiune asupra Curţii Constituţionale privind validareareferendumului. Toate aceste acuzaţii au ridicat semne de întrebare privind legitimitatea oricărui rezultat careeste aşteptat", a spus Philip Gordon.De asemenea, Philip Gordon a spus, într-o întâlnire la Bucureşti cureprezentanţi ai societăţii civile, că nu s-ar fi aflat în România la mijlocul lunii august dacă Statele Unite nu arfi avut senzaţia că aici se întâmplă ceva foarte important şi care alunecă în direcţia greşită.

26. Şase mari bănci din SUA, atacate de hacker

Clienţii a şase mari bănci americane Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, US Bank şiPNC deplâng proasta comunicare din partea băncilor, care nu au anunţat la timp că au probleme şi că accesulla conturi şi la serviciile de plată online urma să nu funcţioneze normal, potrivit New York Times.

"A fost poate cea mai prost comunicată veste proastă pe care am primit-o vreodată de la o companie. Esteextrem de frustrant", comentează Paul Downs, antreprenor din Bridgeport, Pennsylvania.Băncile au fost ţinta unor atacuri de tip DDoS, hackerii inundând serverele cu trafic pentru a le scoate dinfuncţiune. Astfel de atacuri nu sunt sofiscitate din punct de vedere tehnic şi nu presupun accesul atacatorilor lafişierele companiilor, astfel că datele clienţilor şi conturile bancare nu au fost în pericol. Atacurile au fost revendicate de un grup de hackeri care susţin că au legături în Orientul Mijlociu. Aceştia auafirmat că au încercat să răzbune filmul anti-Islam produs în Statele Unite care a stârnit proteste în lumeaarabă.Hackerii promit că vor continua să atace companii din SUA, probabil şi din Franţa, Israel şi MareaBritanie, până când clipul video va dispărea de pe internet. Printre companiile vizate de ei se numără şioperatorii bursieri New York Stock Exchange şi Nasdaq.

1. Wrongly labelled. The economic downturn has made it harder to speak sensibly of aregion called “eastern Europe”

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IT WAS never a very coherent idea and it is becoming a damaging one. “Eastern Europe” is a geographicaloddity that includes the Czech Republic (in the middle of the continent) but not Greece or Cyprus (supposedly “western” Europe but in the far south-east). It makes little sense historically either: it includes countries (likeUkraine) that were under the heel of the Soviet empire for decades and those (Albania, say) that only brushedit. Some of those countries had harsh planned economies; others had their own version of “goulashcommunism” (Hungary) or “self-managed socialism” (Yugoslavia).Already unreliable in 1989, the label hasstretched to meaninglessness as those countries’ fortunes have diverged since the collapse of communism. Thenearly 30 states that once, either under their own names or as part of somewhere else, bore the label

“communist” now have more differences than similarities. Yet calling them “eastern Europe” suggests not only a common fate under totalitarian rule, but a host of ills that go with it: a troubled history then; bad governmentand economic misery now.The economic downturn has shown how misleading this is. Worries about“contagion” from the banking crisis in Latvia raised risk premiums in otherwise solid economies such asPoland and the Czech Republic—a nonsense based on outsiders’ perceptions of other outsiders’ fears. In fact,the continent’s biggest financial upheaval is in Iceland (see article, article), and the biggest forecast budgetdeficits in the European Union next year will not be in some basket-cases from the ex-communist “east” but inBritain and in Greece. The new government in Athens is grappling with a budget deficit of at least 12.7% of GDP and possibly as much as 14.5%. European Commission officials are discussing that in Greece this week.None of the ten “eastern” countries that joined the EU is in so bad a mess. They include hotshots andslowcoaches, places that feel thoroughly modern and those where the air still bears a rancid tang from past

misrule. Slovenia and the Czech Republic, for example, have overhauled living standards in Portugal, thepoorest country in the “western” camp. Neither was badly hit by the economic downturn. Some of the ex-communist countries now have better credit ratings than old EU members and can borrow more cheaply.Together with Slovakia, Slovenia has joined the euro, which Sweden, Denmark and Britain have not. Estonia—at least in outsiders’ eyes—is one of the least corrupt countries in Europe, easily beating founder members of the EU such as Italy.Three sub-categories do make sense. One is the five autocratic ’stans of Central Asia(Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan). They scarcely count as “Europe”, thougha hefty Britain-sized tenth of Kazakhstani territory (some 200,000 square kilometres) lies unambiguously inEurope. Kazakhstan also this year chairs the Organisation for Security and Co-operation in Europe, a Vienna- based post-cold-war talking shop. But none of the ’stans has become a member of the Council of Europe(another talking shop and human-rights guardian, based in Strasbourg). That shows the problem. The

definition of “Europe” is as unreliable as the word “eastern”.The ’stans vary (Tajikistan is poor, Kazakhstan go-getting). But all have slim prospects of joining the EU in the lifetime of anyone reading this article. That createsa second useful category: potential members of the union. It starts with sure-fire bets such as Croatia, andother small digestible countries in the western Balkans such as Macedonia. It includes big problematic casessuch as Turkey and Ukraine and even—in another optimistic couple of decades—four other ex-Soviet republics,Georgia, Moldova, Armenia and Azerbaijan (the last, maybe, one day, on Turkey’s coat-tails).

2. Romanies. Home thoughts. France’s expulsion of Romanies arouses mixed feelings intheir home countries

FINGER-WAGGING rebukes from outsiders about the treatment of Romanies (Gypsies) in the EuropeanUnion’s newish eastern members may go down less well in future. In these countries a substantial slice of the

public, not just the far right, feels vindicated by the deportation of thousands of jobless Romani squatters fromItaly and France. These people see Romanies as an ineducable, thieving menace who need to be segregatedfrom, not included in, mainstream society. In Hungary the far-right Jobbik party has applauded the Frenchmove. It wants Romanies to be interned and stripped of their citizenship unless they show that they want toaccept social norms. Corneliu Vadim Tudor, a Romanian far-right politician, asked mockingly why France wasnot sending Romanies back “to their home country, India”. Only a few politicians in the region havecondemned the French action outright. Karel Schwarzenberg, the Czech foreign minister, said it smacked of racism. Hungary’s government says it will make Romani issues a big part of next year’s EU presidency, butgives no details. Other politicians have said, loudly, that the law must be upheld (by which they generally meanlaws that end up with Romanies being prosecuted, not protected). Romania’s government has not condemnedthe French treatment of its citizens (though parliament, belatedly, did so on September 22nd). PresidentTraian Basescu said France should stop the expulsions but also that “gypsies” should get their children into

school, not out begging. (He also complained that “Roma”, the favoured term in western Europe, sounds like“Romanian”).Those who see the problem chiefly as a result of ingrained poverty, disadvantage anddiscrimination take a different stance. Jirina Siklova, once a leading Czech dissident, now helps prepareRomani students for university. She says France’s behaviour will increase prejudice. “We were criticised formaking mistakes…people can now say the pot was calling the kettle black.” Katerina Copjakova, a Czech

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 journalist who covers Romani issues, says France was right to deport wrongdoers, but it should not havestigmatised Romanies as an ethnic group. The impact is worse, she says, because of France’s role as the“paragon” of liberty, equality and fraternity.In several countries anger over double standards has sparkedsolidarity between Romanies and the majority population. In Bulgaria the government has avoided criticisingFrance publicly (for fear of jinxing its chances of joining the Schengen passport-free zone in 2011). Butcampaigners have been vocal. A protest outside the French embassy in Sofia attracted all ethnicities under banners reading “We are all Roma”. The main tone is pessimistic. East Europeans recall communist-eraforcible social integration. That involved compulsory adoption and transfer of children to orphanages, and insome countries forced sterilisation, as well as the plentiful provision of compulsory low-skilled jobs and the

prosecution of vagrants and beggars. If those proved useless, people say, the milder measures of a democraticsociety stand even less chance of working. Few follow this argument to the conclusion of internment anddeportation. In any case, it ignores the disastrous effect of communism on Romani livelihoods and culture. Italso discounts the success stories.A particular problem is that voters in many countries strongly opposemeasures favoured by local and outside do-gooders. Proposals to end segregated education attract special ire, with arguments redolent of past busing controversies in America. Most parents want a good education for theirown children, not somebody else’s. In countries where public services are poor and the criminal-justice system weak, public confidence in officialdom is already frayed. Sharing the cake fairly with a distrusted and oftendespised minority arouses strong feelings. Even the strongest advocates of Romani inclusion see a long slogahead. Ivan Ivanov, a Bulgarian human-rights lawyer who runs the European Roma Information Office, aBrussels-based legal lobby, says no European country has really made integration policies work. Political will islacking, chiefly because devoting attention (or money) to Romani problems does not win elections. “No

politician has gained anything by dealing with Roma integration,” he notes. He suggests taking responsibility away from national governments and creating a common European policy. Nice idea. Who wants to tell MrSarkozy?

3. France's poor image. France v the world. How the Romani row has dented France’sinternational standing

IT WAS operation damage control this week, as the Elysée tried to revive the president’s standing abroad aftersharp criticism of his expulsion of Romanies. In a big speech in New York, Nicolas Sarkozy pledged to do moreto combat AIDS and help Africa. He secured a cheerful photo with Angela Merkel days after a diplomaticpunch-up in Brussels. Even his wife, Carla Bruni-Sarkozy, joined the charm offensive with an elegantperformance, in English, on CNN.For all the president’s defiance, the French have been knocked by the

response to the Romani row. Fully 71% of respondents to one poll said that they thought France’s image abroadhad been tainted. The low point was last week’s declaration by Viviane Reding, the European justicecommissioner, that she was “appalled” by the removal of an ethnic group, something she “thought Europe would not have to witness again after the second world war”. Mr Sarkozy fought back in Brussels, cannily transforming himself into the victim of “outrageous” and “gravely insulting” comments, thereby distractingattention from the policy itself. But the underlying complaint (and the threat of legal proceedings againstFrance) remains.Standing up to the European Commission usually goes down well in France, where votershave mixed feelings about Europe and do not like being bossed about by unelected bureaucrats. So this row may yet help Mr Sarkozy at home. Although his overall popularity slipped again this month, polls suggest that voters approve of his expulsion of the illegal Romanies. The trouble is the international damage. The Frenchare sensitive to this. Endless television and radio talk shows pick over France’s deteriorating image abroad,touching not only the Romanies but also the strike by the national football team at the World Cup this summer

and the Bettencourt affair, a political-favours scandal involving Eric Woerth, the labour minister.  Le Monde wrote of a “double debasement: of the authority of Nicolas Sarkozy and of the image of France in Europe and inthe world.” Dominique de Villepin, a former prime minister and rival of Mr Sarkozy, also weighed in. “Those who love France”, he said, “do not recognise our country.” He argues that French diplomacy is absent on the big questions, such as the Middle East peace talks, while worrying disproportionately about Romanies.Thecoming months will test Mr Sarkozy’s image anew. In mid-November France takes over the 12-monthpresidency of the G20, and in 2011 the G8 as well. Mr Sarkozy hopes to use these platforms to boost hisstanding abroad and his poll numbers at home, just as he did when France held the presidency of the EuropeanUnion in the second half of 2008. He is not short of bold ideas, including a global financial tax, the regulationof commodity derivatives and measures to limit exchange-rate volatility. He also wants to overhaulinternational financial institutions and to set up a G20 secretariat.Foreign leaders have learned to discountmuch of Mr Sarkozy’s rhetorical excess, argues Zaki Laïdi, a political scientist at Sciences-Po. But next year is

close to the 2012 presidential election. The more Mr Sarkozy shores up domestic support with a hard line onsecurity and immigration the more he runs the risk of renewed disapproval abroad