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Gene Ellis

The Nation: Who Will Avert A Euro Collapse? : NPR - 0 views

www.npr.org/...who-will-avert-a-euro-collapse

shared by Gene Ellis on 16 May 12 - No Cached
  • Even as the mainstream media warned that Hollande's populism would be punished by the bond markets, the IMF's chief economist, Frenchman Olivier Blanchard — who is closer to Hollande's heterodoxy than might be expected — confessed that "schizophrenic" investors are now as scared by the impact of austerity on growth as they are of fiscal largesse.
  • "With zero growth and rising interest costs in Spain and Italy, no debt is sustainable," Fitoussi said. "Even France will be challenged if it goes into recession."
  • which, despite their recently elected conservative governments, are aware that only pan-European investment, eurobonds and the full support of the ECB can save the eurozone.
Gene Ellis

Central banks prepare for turmoil after Greek vote | Reuters - 0 views

www.reuters.com/...e-crisis-idUSBRE85D0CA20120616

central banks turmoil greek vote reuters

shared by Gene Ellis on 16 Jun 12 - No Cached
  • ECB President Mario Draghi, one of many policymakers gearing up for trouble after Sunday's vote in Greece, said his bank was ready to step in and fund any viable euro zone bank that gets in trouble.
  • At best, we are going to have a situation that is extremely serious on Monday," Swedish Finance Minister Anders Borg told journalists. "In all likelihood, whatever the outcome, we are going to have a government which is going to find it hard to live up to the agreements they (the Greeks) have signed up to."
Gene Ellis

Op-ed: The End of the Euro: A Survivor's Guide - 0 views

www.iie.com/...oped.cfm

EUROCRISIS

shared by Gene Ellis on 16 Jun 12 - No Cached
  • Ms. Lagarde's empathy is wearing thin and this is unfortunate—particularly as the Greek failure mostly demonstrates how wrong a single currency is for Europe.
  • The Greek backlash reflects the enormous pain and difficulty that comes with trying to arrange "internal devaluations" (a euphemism for big wage and spending cuts) in order to restore competitiveness and repay an excessive debt level.
  • During the next stage of the crisis, Europe's electorate will be rudely awakened to the large financial risks which have been foisted upon them in failed attempts to keep the single currency alive. When Greece quits the euro, its government will default on approximately 121 billion euros of debt to official creditors and about 27 billion euros owed to the IMF.
  • ...7 more annotations...
  • More importantly and less known to German taxpayers, Greece will also default on 155 billion euros directly owed to the euro system (comprised of the ECB and the 17 national central banks in the euro area). This includes 110 billion euros provided automatically to Greece through the Target2 payments system—which handles settlements between central banks for countries using the euro. As depositors and lenders flee Greek banks, someone needs to finance that capital flight, otherwise Greek banks would fail. This role is taken on by other euro area central banks, which have quietly lent large funds, with the balances reported in the Target2 account. The vast bulk of this lending is, in practice, done by the Bundesbank since capital flight mostly goes to Germany, although all members of the euro system share the losses if there are defaults.
  • But between Target2 and direct bond purchases alone, the euro system claims on troubled periphery countries are now approximately 1.1 trillion euros (this is our estimate based on available official data). This amounts to over 200 percent of the (broadly defined) capital of the euro system.
  • No responsible bank would claim these sums are minor risks to its capital or to taxpayers. These claims also amount to 43 percent of German Gross Domestic Product,
  • Jacek Rostowski, the Polish Finance Minister, recently warned that the calamity of a Greek default is likely to result in a flight from banks and sovereign debt across the periphery, and that—to avoid a greater calamity—all remaining member nations need to be provided with unlimited funding for at least 18 months. Mr. Rostowski expresses concern, however, that the ECB is not prepared to provide such a firewall, and no other entity has the capacity, legitimacy, or will to do so.
  • The most likely scenario is that the ECB will reluctantly and haltingly provide funds to other nations—an on-again, off-again pattern of support—and that simply won't be enough to stabilize the situation.
  • he automatic mechanics of Europe's payment system will mean the capital flight from Spain and Italy to German banks is transformed into larger and larger de facto loans by the Bundesbank to Banca d'Italia and Banco de Espana—essentially to the Italian and Spanish states. German taxpayers will begin to see through this scheme and become afraid of further losses.
  • there will be recognition that the ECB has lost control of monetary policy, is being forced to create credits to finance capital flight and prop up troubled sovereigns—and that those credits may not get repaid in full. The world will no longer think of the euro as a safe currency; rather investors will shun bonds from the whole region, and even Germany may have trouble issuing debt at reasonable interest rates.
Gene Ellis

New Truths That Only One Can See - NYTimes.com - 0 views

www.nytimes.com/...ths-that-only-one-can-see.html

methodology

shared by Gene Ellis on 22 Jan 14 - No Cached
  • New Truths That Only One Can See
  • Given the desire for ambitious scientists to break from the pack with a striking new finding, Dr. Ioannidis reasoned, many hypotheses already start with a high chance of being wrong
  • Taking into account the human tendency to see what we want to see, unconscious bias is inevitable.
  • ...5 more annotations...
  • If one of five competing labs is alone in finding an effect, that result is the one likely to be published.
  • The effect is amplified by competition for a shrinking pool of grant money and also by the design of so many experiments — with small sample sizes (cells in a lab dish or people in an epidemiological pool) and weak standards for what passes as statistically significant.
  • Among them is a paper in which C. Glenn Begley, who is chief scientific officer at TetraLogic Pharmaceuticals, described an experience he had while at Amgen, another drug company. He and his colleagues could not replicate 47 of 53 landmark papers about cancer. Some of the results could not be reproduced even with the help of the original scientists working in their own labs.
  • Scientists talk about “tacit knowledge,” the years of mastery it can take to perform a technique. The image they convey is of an experiment as unique as a Rembrandt.
  • The problem stands to get worse. It has been estimated that the corpus of scientific knowledge has doubled in size every 10 to 15 years since the days of Isaac Newton.
Gene Ellis

Oops: Azerbaijan released election results before voting had even started - 0 views

www.washingtonpost.com/...before-voting-had-even-started

Azerbaijan voting

shared by Gene Ellis on 09 Jan 14 - No Cached
  • So it was a bit awkward when Azerbaijan's election authorities released vote results – a full day before voting had even started.
  • The data were quickly recalled. The official story is that the app's developer had mistakenly sent out the 2008 election results as part of a test. But that's a bit flimsy, given that the released totals show the candidates from this week, not from 2008.
Gene Ellis

Ford Pays a High Price for Plant Closing in Belgium - NYTimes.com - 0 views

www.nytimes.com/...-plant-closing-in-belgium.html

factory closing Belgium

shared by Gene Ellis on 09 Jan 14 - No Cached
  • In Genk, a city of 65,000 people, many of them descendants of Italians, Turks or Moroccans who came decades ago to dig coal, an estimated 10,000 jobs will be lost at the end of next year when Ford closes the factory.
  • And Genk was among the European factories with the most excess capacity.
  • In 2012, Ford lost $1.8 billion in Europe for the full year.
  • ...2 more annotations...
  • The relocation of some production to Spain has already created 1,300 new jobs in a region that is in far worse economic shape than the area around Genk, although Ford said labor costs in Valencia are not significantly lower.
  • Like many in Genk, Mr. Maurina and his wife, Sabrina Gattanella, who have two young boys, are descendants of Italians who migrated to the region decades ago to work in the coal mines. But the last mine closed in the 1980s.
Gene Ellis

Nouriel Roubini explains why many previously fast-growing economies suddenly find themselves facing strong headwinds. - Project Syndicate - 0 views

www.project-syndicate.org/...selves-facing-strong-headwinds

shared by Gene Ellis on 05 Feb 14 - No Cached
  • Nonetheless, the threat of a full-fledged currency, sovereign-debt, and banking crisis remains low, even in the Fragile Five, for several reasons
  • All have flexible exchange rates,
  • a large war chest of reserves
  • ...5 more annotations...
  • and fewer currency mismatches
  • Many also have sounder banking systems, while their public and private debt ratios, though rising, are still low
  • But the short-run policy tradeoffs that many of these countries face – damned if they tighten monetary and fiscal policy fast enough, and damned if they do not – remain ugly.
  • As it is widely known, transfer pricing is the major tool for corporate tax avoidance, and it creates current account deficit when a multinational company receives from its own branch
  • abroad, the previously transferred own profit, as a debt.
Gene Ellis

How Putin Forged a Pipeline Deal That Derailed - NYTimes.com - 0 views

www.nytimes.com/...eline-deal-that-derailed-.html

shared by Gene Ellis on 05 Feb 15 - No Cached
  • How Putin Forged a Pipeline Deal That Derailed
  • The pipeline, known as South Stream, was Mr. Putin’s most important European project, a tool of economic and geopolitical power critical to twin goals: keeping Europe hooked on Russian gas, and further entrenching Russian influence in fragile former Soviet satellite states as part of a broader effort to undermine European unity.
  • The bill that Parliament took up on April 4 was arcane. But it swept aside a host of European regulations — rules that Mr. Putin did not want to abide by — for a pipeline that would deliver gas throughout southern Europe. Continue reading the main story Related Coverage In Diplomatic Defeat, Putin Diverts Pipeline to TurkeyDEC. 1, 2014
  • ...9 more annotations...
  • In France, the leader of the far-right National Front, Marine Le Pen, recently acknowledged that her party had received a loan for 9 million euros, or about $11 million, from a Kremlin-linked bank.
  • Faced with punishing sanctions, a petro-economy pushed to the brink by plunging oil prices and the wildly gyrating value of the ruble, Mr. Putin this month halted the project.
  • Geological surveys suggested that Bulgaria could be sitting atop an underground ocean of natural gas, enough to be self-sufficient for years, enough to eclipse the advantages of South Stream.
  • On April 4, 2014, soon after Mr. Putin annexed Crimea, Bulgaria’s Parliament gave initial passage to a bill that effectively exempted South Stream from a number of European Union regulations, most important, the one that would have forced Gazprom to allow non-Russian gas to flow through the pipeline.
  • “If I hear one more word about competition, I’m going to freeze your you-know-whats off,” Mr. Putin reportedly shouted.
  • The anti-fracking movement became so broad that in January 2012, Parliament banned not only the extraction of shale gas, but even exploration that would quantify the country’s reserves.
  • When the Bulgarian government refused, the European Union cut off tens of millions of euros in regional development funds.
  • In desperate need of the European funds, the prime minister announced the next day that South Stream would be halted until it had full European Union approval.
  • While “he overreached, and he underestimated the response” to his intervention in Ukraine, said Mr. Gray, the former American diplomat, the Russian leader has been “quite effective” in countries like Bulgaria.“He won a great deal by getting Nabucco stopped,” Mr. Gray said. “Ultimately, his goal is to keep as much control over the former parts of the Soviet empire as possible.”
Gene Ellis

Why Do Americans Stink at Math? - NYTimes.com - 0 views

www.nytimes.com/...o-americans-stink-at-math.html

shared by Gene Ellis on 05 Feb 15 - No Cached
  • Why Do Americans Stink at Math?
  • The Americans might have invented the world’s best methods for teaching math to children, but it was difficult to find anyone actually using them.
  • In fact, efforts to introduce a better way of teaching math stretch back to the 1800s. The story is the same every time: a big, excited push, followed by mass confusion and then a return to conventional practices.
  • ...25 more annotations...
  • Carefully taught, the assignments can help make math more concrete. Students don’t just memorize their times tables and addition facts but also understand how arithmetic works and how to apply it to real-life situations. But in practice, most teachers are unprepared and children are baffled, leaving parents furious.
  • On national tests, nearly two-thirds of fourth graders and eighth graders are not proficient in math. More than half of fourth graders taking the 2013 National Assessment of Educational Progress could not accurately read the temperature on a neatly drawn thermometer.
  • On the same multiple-choice test, three-quarters of fourth graders could not translate a simple word problem about a girl who sold 15 cups of lemonade on Saturday and twice as many on Sunday into the expression “15 + (2×15).” Even in Massachusetts, one of the country’s highest-performing states, math students are more than two years behind their counterparts in Shanghai.
  • A 2012 study comparing 16-to-65-year-olds in 20 countries found that Americans rank in the bottom five in numeracy.
  • On a scale of 1 to 5, 29 percent of them scored at Level 1 or below, meaning they could do basic arithmetic but not computations requiring two or more steps.
  • One study that examined medical prescriptions gone awry found that 17 percent of errors were caused by math mistakes on the part of doctors or pharmacists.
  • “I’m just not a math person,” Lampert says her education students would say with an apologetic shrug.
  • In the 1970s and the 1980s, cognitive scientists studied a population known as the unschooled, people with little or no formal education.
  • For instance, many of the workers charged with loading quarts and gallons of milk into crates had no more than a sixth-grade education. But they were able to do math, in order to assemble their loads efficiently, that was “equivalent to shifting between different base systems of numbers.”
  • Studies of children in Brazil, who helped support their families by roaming the streets selling roasted peanuts and coconuts, showed that the children routinely solved complex problems in their heads to calculate a bill or make change.
  • The cognitive-science research suggested a startling cause of Americans’ innumeracy: school.
  • The answer-getting strategies may serve them well for a class period of practice problems, but after a week, they forget. And students often can’t figure out how to apply the strategy for a particular problem to new problems.
  • In the process, she gave them an opportunity to realize, on their own, why their answers were wrong.
  • At most education schools, the professors with the research budgets and deanships have little interest in the science of teaching
  • Only when the company held customer focus groups did it become clear why. The Third Pounder presented the American public with a test in fractions. And we failed. Misunderstanding the value of one-third, customers believed they were being overcharged. Why, they asked the researchers, should they pay the same amount for a third of a pound of meat as they did for a quarter-pound of meat at McDonald’s. The “4” in “¼,” larger than the “3” in “⅓,” led them astray.
  • Some of the failure could be explained by active resistance.
  • A year after he got to Chicago, he went to a one-day conference of teachers and mathematicians and was perplexed by the fact that the gathering occurred only twice a year.
  • More distressing to Takahashi was that American teachers had almost no opportunities to watch one another teach.
  • In Japan, teachers had always depended on jugyokenkyu, which translates literally as “lesson study,” a set of practices that Japanese teachers use to hone their craft. A teacher first plans lessons, then teaches in front of an audience of students and other teachers along with at least one university observer. Then the observers talk with the teacher about what has just taken place. Each public lesson poses a hypothesis, a new idea about how to help children learn.
  • The research showed that Japanese students initiated the method for solving a problem in 40 percent of the lessons; Americans initiated 9 percent of the time.
  • Similarly, 96 percent of American students’ work fell into the category of “practice,” while Japanese students spent only 41 percent of their time practicing.
  • Finland, meanwhile, made the shift by carving out time for teachers to spend learning. There, as in Japan, teachers teach for 600 or fewer hours each school year, leaving them ample time to prepare, revise and learn. By contrast, American teachers spend nearly 1,100 hours with little feedback.
  • “Sit on a stone for three years to accomplish anything.”
  • In one experiment in which more than 200 American teachers took part in lesson study, student achievement rose, as did teachers’ math knowledge — two rare accomplishments.
  • Examining nearly 3,000 teachers in six school districts, the Bill & Melinda Gates Foundation recently found that nearly two-thirds scored less than “proficient” in the areas of “intellectual challenge” and “classroom discourse.”
Gene Ellis

Oversize Expectations for the Airbus A380 - NYTimes.com - 0 views

www.nytimes.com/...tions-for-the-airbus-a380.html

shared by Gene Ellis on 18 Feb 15 - No Cached
  • this aircraft, which can hold more than 500 passengers. The plane dwarfs every commercial jet in the skies.
  • Its two full-length decks total 6,000 square feet, 50 percent more than the original jumbo jet, the Boeing 747.
  • The A380 was also Airbus’s answer to a problematic trend: More and more passengers meant more flights and increasingly congested tarmacs. Airbus figured that the future of air travel belonged to big planes flying between major hubs.
  • ...17 more annotations...
  • Airbus has struggled to sell the planes. Orders have been slow, and not a single buyer has been found in the United States, South America, Africa or India.
  • While the A380 program has been a boon for the European aerospace industry, Airbus is unlikely to recover its research and development costs. The best it can now expect is to break even on production costs, according to analysts, provided that it can keep orders going.
  • Airbus made the wrong prediction about travel preferences. People would rather take direct flights on smaller airplanes, he said, than get on big airplanes — no matter their feats of engineering — that make connections through huge hubs.
  • “It’s a commercial disaster,” Mr. Aboulafia says. “Every conceivably bad idea that anyone’s ever had about the aviation industry is embodied in this airplane.”
  • Airline executives were wary of expanding their fleets aggressively, especially for a costly, four-engine fuel hog.
  • And there are a fair number of those routes. Around 15 of the 20 largest long-haul routes by passenger volume in the world today are slot-constrained,
  • “The A380 is not made for every route, but it is ideal for high-traffic routes, high-volume routes that are congested, or where there are flying constraints,”
  • A little more than a decade ago, the two dominant airplane makers, Boeing and Airbus, looked at where their businesses were headed and saw similar facts: air traffic doubling every 15 years, estimates that the number of travelers would hit four billion by 2030 — and came to radically different conclusions about what those numbers meant for their future.
  • Boeing, too, is facing lukewarm demand for its latest jumbo jet upgrade, known as the 747-8. The company has received just 51 orders for this big plane, which can seat about 460 passengers and lists at $357 million. By contrast, it has sold more than 1,200 twin-engine 777s, which sell for as much as $320 million.
  • Richard H. Anderson, Delta’s chief executive, has said the A380 is “by definition an uneconomic airplane unless you’re a state-owned enterprise with subsidies.”
  • Bruno Delile, Air France’s senior vice president for fleet management, says that there are a limited number of routes in its network with enough daily traffic to justify the expense of such a big plane. “The forecasts about traffic growth and market saturation haven’t exactly panned out,” he says.
  • Not only do airlines take a big risk on the size and cost of the A380, but they also have to gain the cooperation of airports to modify gates and widen taxiways to make room for the plane.
  • With versions that seat 210 to 330 passengers, and with a range of about 9,000 miles, the 787 allows airlines to fly pretty much anywhere in the world and connect smaller airports without going through a hub.
  • And passengers are willing to pay more to avoid a connection
  • f most airlines appear skeptical of the A380, Emirates is a true believer. It stunned the industry in December when it ordered 50 more of the planes, beyond the 90 it already had on order, throwing Airbus a much needed lifeline
  • The airport handled 66 million passengers last year, rivaling Heathrow as the busiest international hub.
  • for Emirates, the biggest selling point of the A380 is its ability to pack in more business-class seats and create an environment that appeals to big-spending passengers.
Gene Ellis

EU energy market: Pipe dream - FT.com - 0 views

www.ft.com/...3c-11e3-afb3-00144feabdc0.html

shared by Gene Ellis on 18 Feb 15 - No Cached
  • EU energy market: Pipe dream
  • A more competitive market also means importing new sources of gas from Azerbaijan and the eastern Mediterranean, as well as building terminals for liquefied natural gas.
  • France’s nuclear industry was also reticent about cheap renewable energy streaming into the French grid on an uncertain timetable.
  • ...5 more annotations...
  • Spain’s grid is barely connected to France so its wind farms cannot export their production when it exceeds domestic demand. Similarly, solar and wind energy from southern Italy is wasted because it is not effectively linked to the industrial north.
  • Full energy convergence needs more than interconnectors. Widely divergent electricity prices are often determined by national tax rates. Grids that can respond to demand further afield in a continent-wide “supergrid” will need more direct (rather than alternating) current infrastructure. While it took Spain and France more than three decades to build a 64.5km interconnection, some 52,000km of lines need to be built or upgraded across the continent.
  • Poland argues that Gazprom has confidential data on each country it deals with, knowing its gas prices and infrastructure vulnerabilities. It can then use this data to its advantage, pushing some countries into more onerous contracts than others.
  • The advantage of a hub would become more apparent when new supplies from Azerbaijan and the eastern Mediterranean are integrated into the market by means of the so-called southern corridor supply route.
  • Geoffrey Feasey of the European Network of Transmission Systems Operators for Electricity says one-third of the most vital projects to connect Europe are being held up by “permitting and public acceptance”.
Gene Ellis

France banned free shipping. So Amazon made it cost one cent. - 0 views

www.slate.com/...zon_made_it_cost_one_cent.html

shared by Gene Ellis on 05 Feb 15 - No Cached
  • France Banned Free Shipping. So Amazon Made It Cost One Cent.
  • France's fun didn't last long. With the law officially in effect, Amazon announced that it is indeed complying with the terms and charging for shipping—a full one cent.
  • Where Amazon can't shirk the law so easily is in its second provision: that online retailers can no longer legally discount the price of books.
Gene Ellis

Syriza and the French indemnity of 1871-73 | Michael Pettis' CHINA FINANCIAL MARKETS - 0 views

blog.mpettis.com/...he-french-indemnity-of-1871-73

shared by Gene Ellis on 06 Feb 15 - No Cached
  • Fundamental to the argument that Spain (or Greece, or anyone else) has a moral obligation to repay in full its debt to Germany are two assumptions. The first assumption is that “Spain” borrowed the money from “Germany”, and that there is a collective obligation on the part of Spain to repay the German collective. The second assumption is that Spain had a choice in what it could do with the German money that poured into the country, and so it must be held responsible for its having mis-used hard-earned german funds.
  • There was plenty of irresponsible behavior in every country, and it is absurd to think that if German and Spanish banks were pouring nearly unlimited amounts of money into countries at extremely low or even negative real interest rates, especially once these initial inflows had set off stock market and real estate booms, that there was any chance that these countries would not respond in the way every country in history, including Germany in the 1870s and in the 1920s, had responded under similar conditions.
  • The winners have been banks, owners of assets, and business owners, mainly in Germany, whose profits were much higher during the last decade than they could possibly have been otherwise
  • ...3 more annotations...
  •  Second, it is the responsibility of the leading centrist parties to recognize the options explicitly. If they do not, extremist parties either of the right or the left will take control of the debate, and convert what is a conflict between different economic sectors into a nationalist conflict or a class conflict. If the former win, it will spell the end of the grand European experiment.
  • First, as long as Spain suffers from its current debt burden, it does not matter how intelligently and forcefully it implements economic reforms. It will not be able to grow out of its debt burden and must choose between two paths
  • Most currency and sovereign debt crises in modern history ultimately represent a conflict over how the costs are to be assigned among two different groups
  • Gene Ellis on 06 Feb 15
     
    Highly recommended!
Gene Ellis

Greece threatens tilt to Russia and China unless Europe yields - Telegraph - 0 views

www.telegraph.co.uk/...hina-unless-Europe-yields.html

shared by Gene Ellis on 18 Feb 15 - No Cached
  • Greece threatens tilt to Russia and China unless Europe yields
  • Greece's radical new government has threatened to seek money from Russia and China to avert a financial crisis rather than yield to austerity demands from Europe,
  • the defence minister
  • ...2 more annotations...
  • Nikos Chountis, Greece's deputy foreign minister, said on Tuesday that Russia and China had already offered financial support to the country.
  • Cyprus has already caused a political storm by offering to expand Russian access to its ports and airfields – including “military facilities” - though it has stopped short of offering full military bases.
Gene Ellis

Is Europe's gas supply threatened by the Ukraine crisis? | World news | The Guardian - 0 views

www.theguardian.com/...raine-crisis-russsia-pipelines

shared by Gene Ellis on 04 Mar 14 - No Cached
  • Is Europe's gas supply threatened by the Ukraine crisis?
  • more than a quarter of the EU's total gas needs were met by Russian gas, and some 80% of it came via Ukrainian pipelines. Austria, France, Germany, Hungary, Italy and Poland soon reported gas pressure in their own pipelines was down by as much as 30%.
  • While it was eventually resolved through a complex deal that saw Ukraine buying gas from Russia (at full price) and Turkmenistan (at cut price) via a Swiss-registered Gazprom subsidiary
  • ...10 more annotations...
  • But three years later, the same row erupted again: Gazprom demanded a price hike to $400-plus from $250, Kiev flatly refused, and on New Year's day 2009, Gazprom began pumping only enough gas to meet the needs of its customers beyond Ukraine.
  • Again, the consequences were marked. Inevitably, Russia accused Ukraine of siphoning off supplies meant for European customers to meet its own needs, and cut supplies completely
  • several countries – particularly in south-eastern Europe, almost completely dependent on supplies from Ukraine – simply ran out of gas.
  • Bulgaria shut down production in its main industrial plants; Slovakia declared a state of emergency
  • Many industry experts, though, point out that the world has changed since 2009, and that there are any number of reasons why Moscow's natural gas supplies may not prove quite the potent economic and diplomatic weapon they once were.
  • higher than normal temperatures are forecast to continue for several weeks yet, significantly reducing demand for gas and leaving prices at their lowest for two years
  • since the first "gas war" of 2006, many European countries have made huge efforts to increase their gas storage capacity and stocks are high. Some countries, such as Bulgaria, Slovakia and Moldova, which lack large storage capacity and depend heavily on gas supplies via Ukraine, would certainly suffer from any disruption in supplies
  • New Gazprom pipelines via Belarus and the Baltic Sea to Germany (Nord Stream) have cut the proportion of Gazprom's Europe-bound exports that transit via Ukraine to around half the total, meaning only about 15% of Europe's gas now relies on Ukraine's pipelines. Gazprom is also planning a Black Sea pipeline (South Stream), expected in 2015, meaning its exports to Europe will bypass Ukraine completely. Ukraine itself has cut its domestic gas consumption by nearly 40% over the past few years, halving its imports from Russia in the process.
  • Europe is increasingly installing specialist terminals that will allow gas to be imported from countries such as Qatar in the form of liquefied natural gas – while Norway's Statoil sold more gas to European countries in 2012 than Gazprom did. "Since the Russian supply cuts of 2006 and 2009, the tables have totally turned," Anders åslund, an energy advisor to both the Russian and Ukrainian governments, told the Washington Post.
  • Europe accounts for around a third of Gazprom's total gas sales, and around half of Russia's total budget revenue comes from oil and gas. Moscow needs that source of revenue, and whatever Vladimir Putin's geo-political ambitions, most energy analysts seem to agree he will think twice about jeopardising it.
Gene Ellis

Dani Rodrik on the promise and peril of social-science models. - Project Syndicate - 0 views

www.project-syndicate.org/...peril-of-social-science-models

shared by Gene Ellis on 25 Apr 14 - No Cached
  • We have neither the mental capacity nor the understanding to decipher the full web of cause-and-effect relations in our social existence. So our daily behavior and reactions must be based on incomplete, and occasionally misleading, mental models.
  • Social scientists – and economists in particular – analyze the world using simple conceptual frameworks that they call “models.”
  • Useful social-science models are invariably simplifications. They leave out many details to focus on the most relevant aspect of a specific context.
  • ...3 more annotations...
  • But, as inevitable as simplification is for explanation, it is also a trap
  • Unfortunately, economists and other social scientists get virtually no training in how to choose among alternative models. Neither is such an aptitude professionally rewarded. Developing new theories and empirical tests is regarded as science, while the exercise of good judgment is clearly a craft.
  • The philosopher Isaiah Berlin famously distinguished between two styles of thinking, which he identified with the hedgehog and the fox. The hedgehog is captivated by a single big idea, which he applies unremittingly. The fox, by contrast, lacks a grand vision and holds many different views about the world – some of them even contradictory.
Gene Ellis

Across Eastern Europe, Military Spending Lags - NYTimes.com - 0 views

www.nytimes.com/...ato-and-military-spending.html

military spending europe

shared by Gene Ellis on 03 Apr 15 - No Cached
  • Across Eastern Europe, Military Spending Lags
  • After years in which a combination of fiscal pressures and a complacent trust in the alliance’s protection may have led them to drop their guard,
  • many countries are building from a very limited ability and remain years away from fielding anything resembling a formidable force against a military as large as Russia’s.
  • ...6 more annotations...
  • NATO asks member states to spend 2 percent of their gross domestic product on their armed forces, yet only a handful of them actually do. Estonia, the small Baltic state at the alliance’s far eastern edge, is one of them, and Poland, by far the largest and richest country on that flank, is at 1.95 percent.
  • Latvia and Lithuania are spending less than 1 percent, though both have indicated they intend to ratchet up to 2 percent by 2020
  • But it will be a decade before the full impact of this modernization is felt in the field, he said.
  • The plan NATO has agreed on — to set up forward supply bases on the alliance’s eastern front in which 4,000 or so troops could be deployed within 48 hours — might be useful in combating a small, stealth insurgency, like the masked gunmen who arrived in Ukraine to set off that crisis, but would be useless in the face of an invasion. “What is required is to be able to hold off any aggression for at least a couple of weeks, to buy some time and provide some sort of sanctuary for reinforcements”
  • In recent years, Russia has massed tens of thousands of troops for exercises just across their borders.
  • When the Baltic states entered NATO a decade ago, they were urged not to spend their limited resources on building large standing armies, but to depend on others in the alliance to come to their aid in an emergency. Instead, the Baltic countries and other former Soviet satellite states focused their military spending on building specialties that they could offer the alliance, such as Estonia’s focus on cybersecurity
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