I didn’t know whether to laugh or cry when I heard the news on Tuesday that the German authorities were to impose a temporary ban on certain types of transactions – known as “naked short-selling” – in eurozone government securities. Laugh, because it seems more than a coincidence that the announcement was made just before parliament in Berlin was due to open a debate on authorising Germany’s contribution to the €750bn international rescue plan for the eurozone. The ban looks like a piece of raw meat thrown to legislators who labour under the delusion that the eurozone’s debt crisis is all the fault of “speculators” and are eager for revenge.
Cry, because the German announcement underlines how the eurozone’s leaders, after finally appearing to get on top of events with the financial stabilisation plan unveiled on May 10, are once again misjudging the dynamics of the crisis. To cite another example, Italy’s central bank has just decreed that Italian banks will not be required to adjust their capital ratios if eurozone government bonds in their portfolios fall in value. What this will mean in terms of the credibility of financial data published by the banks, I hate to think. Read more
The inimitable Nicolas Sarkozy couldn’t resist the temptation to term last week’s allocation of jobs in the new European Commission as a victory for France and a defeat for Britain. In particular, the French president crowed, he had outmanoeuvred the Brits by securing the internal market portfolio, which is responsible for financial regulation, for Michel Barnier, the new French commissioner.
It was certainly a little undiplomatic for Sarkozy to uncork the metaphorical Champagne bottles so soon after the announcement of the new jobs. There are many raw nerves in the British government and in the City of London about how various EU measures in the pipeline may damage the UK’s financial sector. Sarkozy touched every one of those nerves with a rod of fire. Read more
Ask a minister in a European Union government what post their country hopes to get in the next European Commission, and the response is the same every time – something important to do with the economy. Well, you can’t blame people for not hurrying to step into the shoes of Leonard Orban, the Romanian commissioner for multilingualism.
On the other hand, there aren’t enough top economic jobs for Commission president José Manuel Barroso to satisfy everyone. Truth to tell, the Commission looks too big with 27 members. But that’s the way it is, and that’s the way it will stay under the EU’s Lisbon treaty. A guaranteed seat on the Commission seems a simple, visible way of making a country’s citizens feel connected to the EU. Read more
Since February 1999, when the Organisation for Economic Co-operation and Development’s anti-bribery convention came into force - with the aim of reducing bribery of foreign officials in international business deals - the US has brought 103 cases, Germany more than 40, France 19 and the UK just one. So says “Global Corruption Report 2009: Corruption and the Private Sector”, a study published on Wednesday by Transparency International, the anti-corruption watchdog.
From a British point of view, the report makes uncomfortable reading. “UK companies still have a long way to go to increase their awareness and adopt robust anti-bribery compliance programmes,” it says. Read more
What’s the connection between martial arts and European financial market regulation? Answers in Bulgarian, please. Because the most colourful member of the newly elected European Parliament’s powerful economic and monetary affairs committee is surely Slavi Binev, a Bulgarian MEP.
Binev is a Taekwondo champion whose parliamentary website describes him, with little exaggeration, as “the most recognisable figure in the history of martial arts in Bulgaria”. Perhaps I should add that he is also a wealthy man who belongs to Bulgaria’s ultra-nationalist Ataka party and who runs a company specialising in nightclubs, construction and finance. He knows, shall we say, how to look after himself. Read more