Chinese Vases Welcome

Fidel Sendagorta

March 25, 2008

Felipe Gonzalez once complained that ex Prime Ministers were a little bit like a Chinese vase: a valuable thing indeed, but one for which nobody really knows where to find a place at home. And only last week a maverick conservative member of the Catalan Parliament gave Jose Maria Aznar the Chinese vase treatment after the former Head of Government explained to the BBC that things in Iraq were going rather well.
If the Lisbon Treaty is finally ratified by all 27 member states, their citizens will be relieved to know that their precious chinoiseries may have a worthy place for the next few years: the brand new office of the President of the Council. But its creation raises a few questions about how power will be distributed among the members of the triumvirate at the top of the EU hierarchy: the President of the Commission, the High Representative (with a reinforced role) and the President of the Council. (more…)

Generating Information in Real Markets

Pablo Díaz de Rábago

March 12, 2008

Watching long series of real estate prices can give us a hint to what markets can expect to see as long term points of equilibrium. Data from the US Federal Reserve show real median house price appreciation over the last 70 years to be very modest and in a line of +1%/+2% per annum.
Disintermediation of mortgage risk, (only 2 Trn. US $ over a total of 8 Trn. outstanding is in the hands of banks in the US economy) moral hazard in its rating and management and poor assumptions of the population and the lengthening of the availability of buildable land have led to the worst financial crisis of the last decades. (more…)

The Kosovo Precedent

Nicu Popescu

March 4, 2008

The declaration of independence by Kosovo restarts several fundamental debates in the international relations – ranging from the principle of territorial integrity of the states to Russia’s place in the European security system. But the most delicate political discussion for a series of states affected by secessionist strife is the so-called ‘Kosovo precedent’. In reality yet, we have not one, but several Kosovo precedents.

Is Kosovo a precedent?

Kosovo will be a precedent as long as many relevant political players, in Abkhazia, Transnistria, North Cyprus, Russia or in Moldova, believe that Kosovo is a precedent. The European Union member states (Cyprus, Spain, Romania, Greece, Slovakia) that do not recognise Kosovo’s unilateral declaration of independence implicitly categorise this situation as a precedent. For other international political players, Kosovo is not a precedent. We cannot have absolute truth in such situations. (more…)