French World Cup meltdown

France is now, sitting at the bottom of the Group A table, and amazingly out of the World Cup after 2 losses and 1 draw.

The French are naturally reflective of the loss and the mayhem that led to this abysmal reality, but not before some serious drama.

France is sensitive about its world image in the best of times. But when its team self-destructs on the World Cup stage, when it ties Uruguay and loses to Mexico, when its star forward hurls epithets at the coach and is sent packing, when the team then goes on strike, when some players won’t dress to play against host South Africa today, when the team director resigns in tears, when the French public shouts “shame” in the streets and the sports minister is pushed to the cameras by President Sarkozy to call for team dignity, when the world press snickers, when bank Credit Agricole drops ad sponsorship, and the far right blames “blacks” and the far left blames “millionaire athletes” – it all amounts to a national crisis, a moment of bitter societal soul-searching.

Back in the late 90s, racial diversity in the French team was accredited with its famous win.  Nowadays, it is a cause for little else than more bickering.

“Now in France a sense of decline is exacerbated by economics, the fall of the euro…a betrayal by elites felt in some places, and in the midst of this the French national soccer team is in disarray. Now you hear the words ‘black, black, black’ about the team. Unfortunately, this will spark our ‘cultural’ divide’ discussion.”

There might be a questionable correlation between sports prowess on the international stage and economic prosperity back home, but social cohesion on and off-field seems to translate to a certain degree.

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Unwed daughters, poor boyfriends and other unhappy endings

BP’s hypocrisy problem– Hayward knew that what he was enduring was a ritualized necessity.
On guns, butter and broken windows, now with more oil…– Economists are right in touting the supposed economic benefits of the oil spill.
Retail chains are embracing their online stores– Traditional merchants such as Macy’s are adapting to online shoppers.
What valley companies should Kknow about Tencent– Tencent is the largest, most profitable Internet company in China. OK. It’s also the 3rd largest Internet company in the world, after Google and Amazon. Whoa.

Finance & Economics
Why European countries are like American banks?– Greece is like Bear Stearns, Germany is JP Morgan, and guess which country plays the role of Goldman Sachs?
Canada’s economy is suddenly the envy of the world– And is very smug about it all.
Normal adjustment mechanisms– When metals prices/demand falls the Australian dollar falls. Greece is not so lucky.
Dealing with Dutch disease– The recent boom in primary commodity prices has once more stimulated interest in the issue of “Dutch Disease”.

The rest
Unwed daughters in Greece catch ‘time bomb’ in pension overhaul– Greek spinsters are not marrying for fear of losing their meager pension. Screwed up incentives? You betcha.
China’s real estate boom spells trouble for boyfriends– No house, no car, no girlfriend.  Welcome to the reality of an ever-so-materialistic China.
Soccer done right– Changing soccer scoring would better the underlying competitive realities than the current rules.

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Online news media in South Korea and Japan

Online and citizen-journalism seems to have succeeded in South Korea, but not in Japan.

Japan, with its cultural disdain for those who stick out from the crowd, may be inhospitable terrain for the reader-turned-reporter model, Mr. Takeuchi said.

[A]nother reason for Japan’s resistance to alternative sites is the relative absence of social and political divisions. In politically polarized South Korea, OhmyNews thrived by appealing to young, liberal readers.

“It is only when the society sees itself as having conflicting interests that it will seek out new viewpoints and information,” said Toshinao Sasaki, the author of about two dozen books on the Internet in Japan.

Media experts say Japan has yet to see such critical questioning of its establishment press. They say most Japanese remain at least passively accepting of the nation’s big newspapers and television networks.

On top of the cultural and political differences between these two neighbours, does this also have to do with demographics?

This is South Korea’s population profile.


And this is Japan’s.


South Korea is aging fast, but it still boasts a median age that’s almost 7 years younger than Japan.  A younger, politically divided, and more restless cultural undercurrent seems to be driving this battle.

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Behavioural science behind making vacation plans, and Monday links

China needs a service-sector revolution– Employing workers in sectors where their productivity is stagnant would not be a recipe for social stability.
Environmentalists as battered spouses– Greens keep returning to their abuser after another promise to do good, but nothing in President Obama’s oil spill speech should offer them any hope that the administration is really going to change.
Flight of the desktops– The shift to portable machines fits larger social trends. More Laptops, netbooks, and tablets fit into the new lifestyle. Desktop don’t.
Pleated pants watch: Don’t you want to be “clean”?– Marketing men’s fashion is tricky because, for the majority of male clothes-wearers, the goal is to convince them that it is not fashion.
BOOM: Big issues– Lost in the catastrophic aftermath of the Gulf of Mexico oil spill is the gripping tale of the rig workers and the Coast Guard crewmen who rescued them.

Finance & Economics
Germany’s super competitiveness– German wage restraint has led to a real depreciation of Germany’s fixed nominal exchange rate vis-à-vis its Eurozone members, helping Germany to win market shares at the expense of Southern Europe.
On the lessons to be learned from the elimination of the Canadian federal deficit in the 1990s– If you’re going to count on exports to sustain aggregate demand while your government cuts back, you have to figure out which foreign economy is supposed to absorb all that extra production.
Why it’s different this time for housing– For the economy as a whole, and housing in particular, restraint in borrowing will keep housing well below past cycles, no matter the level of interest rates or house prices.
Gartman: Gold is good but Euro is doomed
Credit Write Downs– With the euro crisis and European credit easing, people have awoken to the fact that the euro is also a fiat currency and that the Europeans may be willing to depreciate the value of their currency as well.
On your Marx– It would add a nice dialectical twist to the future history of our period if it could be said that, around the time the post-Maoist Chinese took up shopping, the post-bubble Americans turned to studying Marx.
Alan Greenspan v. Paul Krugman
Capital Gains and Games– The fiscal debate has become so polarized that combatants on both sides are glossing over what they don’t know.

The rest
The breeders’ cup
WSJ– As you weigh your options, don’t forget that the costs of kids are front-loaded, and the benefits are back-loaded.
The best vacation ever– Research looking at how people actually feel about their vacations suggests that, by and large, they remember them warmly — more warmly, in fact, than they feel while taking them.
Tea and coffee ‘protect against heart disease’– Drinking several cups of tea or coffee a day appears to protect against heart disease, a 13-year-long study from the Netherlands has found.
Healthy at any age– Medical science has generated vast amounts of data, and laypeople have more access to them than ever before, but look closely at that information, and it starts to seem disturbingly incomplete.

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More pills to ease the pain of social rejection and more links for the weekend

Chinese oil rivals smell blood in BP disaster– Opportunistic oil companies including three Chinese concerns are circling over BP assets as costs of a Gulf oil spill mount.
Dubai’s property bubble without answers– In Dubai, a hotel is ranked 212 on Trip Advisor’s hotel list even though it is still under construction.
Forrester projects tablets will outsell netbooks by 2012, desktops by 2013– The tablet era has just begun, but Forrester Research is already predicting tablet sales in the U.S. will overtake netbook sales by 2012, and desktop sales by 2015.
Sharing liberally– A wired future might look good for democracy if some of the social functions currently performed by traditional media are taken up by new Internet projects. But that outcome needs to be demonstrated—perhaps constructively aimed at—rather than assumed.
Oil has become the new tobacco
FT– Many of S&P’s dividend aristocrats rely on the goodwill of consumers and politicians to keep accumulating cash for payouts. The mood following the bail-out of Wall Street is now so hostile to corporations, and public budgets so strained, that any slip would make them vulnerable.

Finance & Economics
How to prevent the next financial crisis? Pop the compensation bubble– It’s time to examine and re-structure the financial incentives afforded to traders living within the Wall Street vacuum.
Few are coming to see Greece’s modern Olympic ruins
WSJ– As Greece sifts through the wreckage wrought by its enormous public debt, which sent tremors through world finance in recent months, the Athens Games are once again unifying this nation—this time as a target of criticism.
The 15 minutes that could save five years– The end of retirement as we know it — an emerging unpleasant reality that will (re)shape the quality of life and standard of living for billions.
To pay a price– What can economic sociology contribute to the national debate in the wake of the BP oil disaster in the Gulf of Mexico?

Headache pill reduces the pain of social rejection– Over-the-counter headache pill paracetamol, also known as acetaminophen, reduces the pain of social rejection.
Ingenious flipper bridge melds left-side drivers with right-side drivers– Hong Kong drives on the left side of the road, mainland China on the right. So how do you prevent crashes when driving between them?
Seats to spare – but Fifa won’t let South Africans fill them– Supporters in South Africa have found themselves unable to get in to supposedly sold-out games, only to see banks of unused seating showing on television pictures.

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Decade of nationalism ahead?

Let’s tally up all the ways Europe is reversing gains made by decades of painful integration efforts:

  • Germany’s North Rhine-Westphalia election clearly put German interests in front of European ones, and its vehement resentment towards Greek bail-out signals the country wants to come out of its WWII political backroom and function as a normal country.
  • The Dutch electorate had a clear preference for more right-winged talk this time around. Two of the three top parties ran on platforms that 1) railed against the EU bureaucracy, 2) railed against (real or imagined) Islamic threats in the country.
  • Belgians took it one step further than anyone else. Previously the golden child that saw itself the trailblazer in multiculturalism, the original mini-EU is now tearing itself apart at the seam.  The Flemish party which ran on a separatist platform won the election.  Although rumours have it that De Wever might very well let the Francophone Socialists run the country for a while, just so they can be the ones that nail the Belgian coffin shut for good.  In the meantime, this kind of stuff is happening.
  • Ring-winged and nationalist parties have always existed on the fringe, but the economic crisis, along with flagrant abuses/misuses of power in Brussels are now ruffling more mainstream feathers than usual.  It’s not just France and Switzerland that have the occasional flair-ups, eastern European countries like Hungary have also entered a period of nationalistic radicalism.

Nationalism can stand alone in a sea of otherwise indifference.  But when closely clustered countries start to one-up each other, we get into trouble.  A decade ago, Europe could’ve pointed to Turkey’s nationalistic turn and snickered.  Nowadays, the pot can’t call the kettle black without sounding like a hypocrite. After all, in 2010, what could be more European?

[W]hat we will see emerging in Turkey is not an Islamist foreign policy but a much more nationalist, defiant, independent, self-confident and self-centered strategic orientation in Ankara. Because of similarities between the French and Turkish political tradition, I think it helps to think of this new Turkish sense of self-confidence, nationalism, grandeur and frustration with traditional partners such as America, Europe and Israel as “Turkish Gaullism.” One should not underestimate the emergence of such a new Turkey that transcends the Islamic-secular divide because both the Kemalist neo-nationalist (ulusalcı) foreign policy and the Justice and Development Party’s (AK Party) neo-Ottomanism — the ideal of regional influence — share the traits of Turkish Gaullism.

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No road too treacherous for China

After much progress made in Africa, its recent incursion into Greece, China is now also moving into Siberia. This is what birch and cedar forests with an open mine pit looks like.


China is here, there, and everywhere.  How long before the backlash begins?

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How to get someone to stay with you forever voluntarily, and other gems

Facebook doesn’t have privacy problems. It has positioning risks.– The recent brouhaha around Facebook’s privacy policies — the complications, the simplifications, the push, and the push-back — is a side-story. The real issue is positioning.
All you need to know about the precious metal from UBS
Zero Hedge– The market consensus expects China to increase its gold holdings over the coming years.
Auburn U. plans engineering campus in China– Auburn University has begun making preliminary plans to open an engineering campus in China, with a goal of developing a full-fledged branch campus that would serve undergraduate and graduate students.
Does the world need more than one Twitter?– Can one company do what Twitter is trying to do? Could one company handle all the email in the world?

Finance & econ
It is time for Asia to rewrite the rules of capitalism
FT– Suggesting a future in which economic policy is framed around limits, restraint and restrictions is to invite controversy, but Asian governments must start down this road. They have no choice.
The average investor is his own worst enemy– Humans seem to be hardwired to expect success and to regard themselves as above average.
European growth is not sustainable so get used to higher unemployment rates– It looks like Europe is going to have to get used to a period of high unemployment, sub-trend consumption and weak economic growth.
Implicit compensation– Executives whose trading freedom is increased experience reductions in other forms of pay to offset the potential gains from trading.
Why plans for early fiscal tightening carry global risks
FT– Far from being stabilising, premature fiscal retrenchment threatens destabilisation of the world economy, should be seen as an act of mercantilist warfare upon the US.

Rest of the good stuff
How to keep someone with you forever– Your lover or employee will stay only as long as she wants to under those systems, and you want to keep her even when she doesn’t want to stay. How do you pin her to your side, irrevocably, permanently, and perfectly legally? You create a sick system.
Red-hot robots– Roxxxy and Rocky, the world’s first sex robots, are ready to leave the lab.
Football: A dear friend to capitalism
The Guardian– Like some austere religious faith, the game determines what you wear, whom you associate with, what anthems you sing and what shrine of transcendent truth you worship at.
Legislation won’t close gender gap in sciences
NY Times– Given all the progress made in math by girls, who now take more math and science classes than boys and get better grades, differences in aptitude are not the primary cause of the gender gap in academic science.

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Europe sees the original Club Med bleeding their retirement funds, China sees vessel capacity

Greek and Chinese companies on Tuesday signed 11 agreements worth hundreds of millions of euros in shipbuilding, telecoms and construction at a ceremony attended by the Chinese vice-premier.

Five Greek shipowners signed deals to build up to 15 bulk carriers at COSCO Shipyards, the construction arm of the Chinese state shipping company, which operates a container terminal at Athens port of Piraeus under a concession arrangement.

Three Greek olive oil traders also signed agreements with Chinese importers aimed at boosting sales of the country’s signature product in an almost untapped market.

The Chinese delegation was due to hold talks with Greek officials on several possible infrastructure investments, a Greek official said.

Projects under consideration include the construction of a €150m logistics centre near Athens and a railhead close to the COSCO terminal at Piraeus, as well as possible Chinese participation in an international airport to be built on the island of Crete.

It really depends on the end of the earth you are looking at Greece from.  Europe sees burdensome economic and political liabilities when it casts its glance south.  The Chinese sees a good place to put its money down.

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Food is about to get a bit more expensive

Which is good news if you live in less developed areas of the world, where your quality of living, starting with more luxurious food, is about to get more plentiful, or even more affordable.  Not so good for those living in more developed parts, where costs will get pushed up simply because demand is higher and supply is most likely going to remain flat.

“As incomes rise, diets are expected to slowly diversify away from staple foods towards increased meats and processed foods,” it said. In turn, with increasing affluence and an expanding middle class, food consumption in developing countries would become less responsive to price and income changes.

In real terms, the report projected cereal prices to rise around 15-40 per cent relative to the 1997-2006 average, up from last year’s forecast of 10-20 per cent. Vegetable oils are expected to be more than 40 per cent higher, against last year’s forecast of a 30 per cent increase. Meat and dairy products will also be more expensive in the next decade, reversing last year’s forecast that pointed to lower prices.

This article blames mostly higher crude oil prices for the uncomfortable news. But the increasing tension between the developing and developed, and between the young and the old, will probably be the trend in the foreseeable future.

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Labour mobility still much higher in the US than Europe


US still winning in labour mobility, which is not at all surprising but still reassuring given the averse impact the sluggish housing market seems to have had on mobility in the past year.

I still think it’s a bit of a paradox that while labour mobility is much encouraged in the US, it still work counter to the goal that home ownership subsidies offered by the government, which encourages social stability and putting roots  down in a community.  Which ideally, I suppose, will help one anchor down and develop a sense of community in the short and medium term, but not strong enough to keep one from packing up and driving off in search of better lives if the right opportunity knocks on the door (or none where you happen to be).

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Religions are more different than alike

As pointed out by Stephen Prothero, taken from reviews here and here:

Just as puritanical Wahhabis refuse to accept that Sufis are proper Muslims, for example, so many evangelical and other Christians insist that Mormons lie outside the orthodox Christian fold. Some major traditions stretch the definitional limits of the word religion to the breaking point. Confucianism, and perhaps a couple other Asian traditions, would appear to have more in common with an ethical system such as stoicism than with most other religious systems, in which creeds and deities and worship are more central. So why is one called a religion and the other not?

Christians regard sin as the problem and see salvation as the solution. Muslims define the problem as pride that can only be conquered by submission. Buddhists seek to overcome suffering while Christians regard suffering as ennobling, which is why Christians aren’t trying to achieve nirvana. Buddhists, unlike Christians, aren’t looking for salvation since they don’t believe in sin. Neither do Confucians. And while Jews and Muslims speak of sin, they are not all that interested in salvation from their sins.

He also went on the Colbert Report to explain the different things each religion set out to explain, which are much more different than a layperson like me would expect.

The Colbert Report Mon – Thurs 11:30pm / 10:30c
Stephen Prothero
Colbert Report Full Episodes Political Humor Fox News
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Euro crisis watch in the north as well as south, and other links

Eurozone breakup a real possibility– The eurozone members cannot credibly backstop the debt. Writedowns and losses are inevitable. It would be better to do it in an orderly fashion, via restructuring, but indeterminacy, aka extend and pretend, is the order of the day.
Charting Europe’s grim sovereign-bank loop
FT Alphaville– This grim sovereign-bank loop is one that’s finally increasingly being picked up by markets, particularly in Spain.
The low countries’ new low
The Guardian– While they may hate being lumped together, the similar choices in both suggest the region may once again merit the collective title of the Low Countries: low in intent, low in outcome, low as in debased.
Belgium’s elections: An artificial kingdom moves closer to its end
The Economist– Belgium is a bit like a company facing a really brutal labour dispute. That is the moment the board appoints a nasty thug as CEO, and the workers elect a militant headbanger as their union representative.
German-French relations on the rocks– It is time for the French to finally save money and the Germans to spend more of it.
Why a tough Europe 2020 strategy is needed to stop the EU from falling behind– The Europe 2020 strategy fails to draw the lessons from the hapless Lisbon strategy. It does not outline a credible route to enhanced growth.

Will major U.S. retailers ever make it big in Britain?– While the British public has long had an appetite for American fast-food vendors, the record of other U.S. retailers who have tried to make it big in Britain is mixed.
What’s in the bottle?– An investigation into the startling fraud accusations that have upended the fine wine world.
They’re just irrational?
Base Line Scenario– Banks don’t accidentally hold too much capital, oil companies don’t accidentally take too many safety precautions. Mistakes only go one way.

The sagging of the middle class
New York Times– Middle-class culture in the United States rests on the precepts of human capitalism, these precepts now seem shakier than they have in the past. No wonder middle-class spirits, as well as incomes, are sagging.
PIMCO on British national solvency
Credit Write Downs– Differences between the Eurozone and sovereign debtors like the UK or US mean PIMCO would not favour Bunds over Treasuries.
Dilbert’s Scott Adams on betting on the bad guys in investing
WSJ– Creator of Dilbert cartoons suggests we invest in companies we hate, like BP.

The economist as journalist
Economic Principals– Recognizing Roubini as a highly accomplished narrator, rather than as a producer of fundamentally new ideas, means reorganizing somewhat our ideas about the Fourth Estate.
Awareness of outside world growing in North Korea– North Koreans are far more aware of the outside world, according to evidence provided by North Korean refugees, South Korean humanitarian aid workers, Chinese traders and others.

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A borderless Europe? Hardly

Consider this paradox. In the last decade, one of the dominant idea of European solidarity has encouraged people of Europe to believe they are Europeans before their respective nationalities.  But parallel to this thread of political movement, there have been more, and not less, emphasis on the importance language plays on the national fronts.

All the more ironic, then, that in the 21st century there would be such a push to tie language to citizenship and inclusion, particularly throughout Europe. According to a Harris poll in 2007, 86% of Germans, 83% of Britons, 61% of French and Italians and 50% of Spaniards believe that citizenship and language tests are necessary for new immigrants. Quite which Spanish language immigrants in Spain are supposed to speak is not entirely clear. Nonetheless, half the country wants them to speak it.

Often, the greater the geographic proximity in which these languages are spoken, the greater the tension. But where Flemish culture is concerned, the primary threat is not really French but American culture and the English language.

With austerity bills landing on the doorsteps of those countries, will language be the final straw that breaks the euro-camel’s back?

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Small-country mindset consequences, and other links for the morning

The eurozone’s tragic small-country mindset
FT– You can take the Portuguese or Belgian prime ministers out of their small open economies, but you can’t take the small open economy mindset out of these men.
Questioning Keynes
CNN Money– Too often, forecasts have been wrong. Which makes Keynesian economics harder to follow in today’s modern economy.
The case against the euro– Growth will be at best anaemic. Unemployment will remain high. The potential legacy of having joined the euro is hard times for a generation.
It’s not hard to understand why Asia’s worried about Europe– Recent external shocks from Europe will likely show up Chinese and Philippine trade data in coming months. Doesn’t look good for Asia, especially for those economies like the Philippines and China for which exports provide a robust growth impetus.

Message in a bottle– The Nike outfits worn by the U.S. team as well as Brazil’s are made solely out of bottles, more specifically, bottles from landfills in Japan and Taiwan.
“for the lolz”: 4chan is hacking the attention economy– While the security hackers were attacking the security economy at the center of power and authority in the pre-web days, these attention hackers are highlighting how manipulatable information flows are.
Think gas is too pricey? Think again.
Washington Post– The question isn’t just what a gallon of gas costs. It’s what a gallon of anything that can replace gas costs. Maybe that’s what we should start asking politicians.

Does Japan really have a public debt problem?– Countries with their own central banks do not need to default; they can inflate, instead. Provided they can borrow at long enough maturities and on favourable terms, the amount of inflation needed to eliminate huge debt overhangs is not enormous, provided it is unexpected.
Open. The. Gates.– What immigration can potentially do for American military spending, Social Security expenditures, medical care costs, and technological growth.
Is a college degree still worth it?– Increasingly, the job market has become polarized, with the fastest-growing occupations on either the low end or the high end, often for positions that require more education than a bachelor’s degree.
Does this mean we never leave?– The New York Times reports on a monster find of minerals in Afghanistan, some of them strategic.

You might be population too– Apparently it’s crazy to want our species extinct, but crazy not to want it arbitrarily smaller.
Boldly going nowhere: Nasa ends plan to put man back on moon
The Times– Nasa has begun to wind down construction of the rockets and spacecraft that were to have taken astronauts back to the Moon, effectively dismantling the US human spaceflight programme despite a congressional ban on its doing so.
Are you what you eat?– While people with an unhealthy lifestyle are no more risk-loving than other people, they are more impatient.

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