The "Race to the Bottom"

Value in Devaluation?

by Patrick Barron

The euro is in trouble. That is not news. What is news is that people with deep pockets are willing to pay for economists to provide a solution. Lord Wolfson has offered a £250,000 prize for the best way a country can exit the European Monetary Union (EMU). Five finalists for the prize were announced in March. The winner will be announced in June.

None of the five finalists — Neil Record, Jens Nordvig, Jonathan Tepper, Catherine Dobbs, and Roger Bootle — advocates a return to sound money; all assume that new, national fiat currencies will float; and all assume that unproductive countries will benefit from devalued new currencies. The theory is that a devalued currency will spur export-driven economic growth. Furthermore, they have little confidence that economic reforms — which they all, by the way, do recommend — will be achieved in the near term and see devaluation as a quicker alternative. But will this work? First a word about devaluation itself.

A Case For The Individual

The Case of Sherlock Holmes

By Maura Pennington,

For a character obsessed with details, Sherlock Holmes would be pleased with the ones that were preserved in the BBC modern adaptation whose second series concluded airing in America this past Sunday.  My favorite is John Watson’s puzzled amusement at the gaps in his friend’s prodigious knowledge. 

In the first novel, A Study in Scarlet, before he learns that Holmes is the world’s only consulting detective, Watson tries to make a list to determine his roommate’s occupation based on his apparent areas of expertise.  He finds that Holmes has only a feeble grasp on politics and no understanding of astronomy, the latter made evident by his ignorance of the fact that the earth revolves around the sun.  Both the literary and televised versions of Holmes give the excuse that it only makes sense to retain knowledge that is applicable to one’s own pursuits in life.  For him, the earth’s position in the universe has no bearing on the observation of the idiosyncrasies of men in order to outwit them.

Coming Together or Flying Apart?

The “Greek fatigue.”

By John Mauldin

The debate among very knowledgeable individuals and institutions as to the future of Europe is intense. There are those who argue that the cost of breaking up the eurozone, even allowing Greece to leave, is so high that it will not be permitted to happen. Estimates abound of a cost of €1 trillion to European banks, governments, and businesses, just for the exit of Greece. And that does not include the cost of contagion as the markets wonder who is next. Keeping Spanish and Italian interest-rate costs at levels that can be sustained will cost even more trillions, as not just government debt but the entire banking system is at stake. Not to mention the pension and insurance funds. If the cost of Greece leaving is €1 trillion, then who can guess the cost of Spain or Italy?

A total Greek default wipes out more than twice the ECB balance sheet. That means the remaining countries will have to put twice as much into the ECB as their present commitment, just to get the ECB back to where it technically stands today (because the assumption is still that Greek debt is good, and so the ECB is still lending money to the Greek Central Bank).

Europe continues to fight the wrong battle

Damned if You do, Damned if You Don’t

by Peter Tchir

It is clear that Greece has had a solvency issue now for over 2 years.  The ECB and Troika chose to treat it as a liquidity problem.  Maybe, they could have argued that in early 2010, but by the summer of 2011 it was obvious to any credit observer that the problem was solvency, yet they continued to treat it as one of liquidity.  That is scary because if they fail to see the problem correctly now, they will fail miserably.  Not only is the problem clearly solvency, but now forced currency conversion has been added to the mix. Any “solution” from the EU must now address that risk, and it is not the same as solvency.  Programs that can protect against solvency may do nothing for the redenomination risk.

'Greece is a Failed Corrupt State

From Head of Deutsche Bank - Purposely Inflammatory Statements to Force Greece Exit

By Mike Shedlock

Strong messages from the head or the IMF, the head of Deutsche Bank, and the president of the Bundesbank are highly likely to drive Greek voters away from New Democracy and Pasok in the June 17 elections.

The Guardian writes It's payback time: don't expect sympathy - Lagarde to Greeks.

The International Monetary Fund has ratcheted up the pressure on crisis-hit Greece after its managing director, Christine Lagarde, said she has more sympathy for children deprived of decent schooling in sub-Saharan Africa than for many of those facing poverty in Athens.

The last public intellectual?

The disillusion of the brightest of this generation.

by Neil Davenport 

Twenty-one years ago, an American-Japanese academic, Francis Fukuyama, wrote an essay called ‘The End of History’. His argument was that the collapse of Stalinist communism in Eastern Europe vindicated the supremacy of liberal-capitalist democracies. For Fukuyama, ‘this was it’ for human progress. Capitalist triumphalism, however, barely lasted 12 months, let alone a lifetime, as Western political elites ended up as disorientated and as demoralised as radical left-wingers. Incredibly, by the mid-1990s, Marx’s political economy was back in academic vogue in the United States, while Western politicians often flattered the moral grandstanding of ‘anti-capitalist’ protesters. From that point on, a consensus has emerged that says economic growth isn’t all its cracked up to be and the state is to be cherished and worshipped. In 2012, who would have thought that ‘The End of History’ would look like Sweden?

It is clear that Germany is already being placed on the hook

The Separation of Bank and State

By David Zervos

The euro monetary system is flawed. It is a system that was cobbled together for political purposes; and sadly it was set up in such a way that each member state retained significant sovereign powers – most importantly the ability to exit the system and default on debts in times of stress. There is virtually NO federal power in the Union, as witnessed by the complete breakdown of the Maastrict and Lisbon treaties. In fact, what we are seeing today is that the structure of the monetary system is so poorly designed, it actually creates perverse fiscal linkages across member states that incentivize strategic default and exit.

Our new leader of the Greek revolt, Mr CHE-pras, has figured this one out. And in turn he is holding Angie hostage as we head into June 17th!

The Revolution will not be Tweeted this weekend

Facebook also a loser in Egypt

By Mark Steyn

So how's that old Arab Spring going? You remember – the "Facebook Revolution." As I write, they're counting the votes in Egypt's presidential election, so by the time you read this the pecking order may have changed somewhat. But currently in first place is the Muslim Brotherhood candidate Mohammed Morsi, who in an inspiring stump speech before the students of Cairo University the other night told them, "Death in the name of Allah is our goal."

Like!

In second place is the military's man, Ahmed Shafiq, Hosni Mubarak's last Prime Minister and a man who in a recent television interview said that "unfortunately the revolution succeeded."

Like!

Greece should imitate Latvia

Latvia Shows the Way, Proving Some Famous Merchants of Doom Wrong

by Anders Aslund

Today, the Latvian government can claim victory. In the first quarter of this year, Latvia’s annualized GDP grew by 6.8 percent, the highest growth rate in Europe, and last year Latvia recorded a growth rate of 5.5 percent, the third highest in Europe. Four years ago, GDP plummeted by a total of 24 percent because of the sudden stop of international financing in September 2008. But that decline lasted only two years. Unemployment has fallen from 21 percent in early 2010 to 16 percent two years later.

How times can change. In December 2008, Paul Krugman claimed, “Latvia is the new Argentina.” In June 2009, Nouriel Roubini asserted that “devaluation seems unavoidable” and that the International Monetary Fund (IMF) and the European Union were “throwing good money after bad” in their support of Latvia’s stabilization program.

But Latvia did not devalue. Instead it carried out a vigorous “internal devaluation,” with large cuts in public expenditures and wages as well as structural reforms, while supported financially by the IMF and the European Union. Many argue that Latvia is special, but the Latvian government did exactly what it was supposed to do and the Latvian people understand that. Remarkably, Valdis Dombrovskis, who became prime minister in the midst of the crisis in March 2009 and led the cure, has been reelected twice in parliamentary elections since then.

The Greek Montenegro option

Endgame in Greece: Don’t Look for an Imminent “Grexit”

by Jacob Funk Kirkegaard

As the countdown toward a new Greek election heads toward June 17, most analysts predict an imminent Greek exit from the euro area. Almost anything can happen, but a few possibilities are worth considering. Any newly elected Greek government will have trouble implementing the current austerity program called for by euro leaders and the International Monetary Fund (IMF). A loss of funding at least from the IMF in 2012 appears likely. On the other hand, it is also likely that Greece will remain a member of the euro in the short run, through 2012. Prospects for an outright Greek Exit—a Grexit—are no more than 5 percent.

Two main scenarios for Greece in the coming weeks depend on politics and the elections.

RUN !!

Who is Minding the Store?

“All within the state, nothing outside the state, nothing against the state. “

                                                     -Benito Mussolini
By Mark Grant

When the Defendants are also the Judge and Jury

Here is a prescription for disaster. Here is an opiate that, once seen, should be avoided at any and all costs because the hand is a losing one far past any combination of cards on the Blackjack table. Yet, this is exactly what Europe is proscribing for owners of unsecured bank debt on the Continent.  The importance of Friday’s announcement was not that unsecured bank debt owners were to take losses if some bank foundered but just who would be deciding what losses were to be taken. 

Yes, it is true, investors for the last three years had been assured and re-assured that the sovereign nation where the bank was domiciled would be back-stopping any bank bonds or that the European Union itself would ring fence all bond holders so that the announcement was in direct contention to what we had all been told to get us to support European bank debt. Europe had claimed responsibility and now they have withdrawn it and this reason alone is enough to push yields for European bank bonds far wider than where they are currently as the charade of one more contingent liability has been officially ended. I assert, just for this reversal in position, that the yields of all unsecured bank bonds on the Continent will gap out from their current levels as what we were told is not what we are to get any longer. The new EU bank plan normalizes the losses to put them on the same plain with the American banks but the second part of the story is where disaster lies and I mean unmitigated disaster.

If the ECB Prints, Would Germany Exit the Euro?

"ECB Will be Insolvent and Costs May Exceed 1 Trillion Euros, in case of Greek exit" Says IIF Director

By MIKE SHEDLOCK

According to IIF director Charles Dallara in a Bloomberg interview, "ECB will be insolvent if Greece were to exit the euro. Europe would have to first and foremost recapitalize its central bank."

Excuse me for asking but how would they attempt to do that? Print Euros?

Please consider Dallara Says Greek Euro Exit May Exceed 1 Trillion Euros :

The cost of Greece exiting the euro would be unmanageable and probably exceed the 1 trillion euros ($1.25 trillion) previously estimated by the Institute of International Finance, the group’s managing director said.

Keynesianism & Eugenics

Νo planner is smarter than nature

"The theory of output as a whole, which is what The General Theory of Employment, Interest and Money purports to provide, is much more easily adapted to the conditions of a totalitarian state."

                                                            John Maynard Keynes

by John Aziz

In looking at and assessing the economic paradigm of John Maynard Keynes — a man himself fixated on aggregates — we must look at the aggregate of his thought, and the aggregate of his ideology.

Keynes was not just an economist. Between 1937 and 1944 he served as the head of the Eugenics Society and once called eugenics ”the most important, significant and, I would add, genuine branch of sociology which exists.” And Keynes, we should add, understood that economics was a branch of sociology. So let’s be clear: Keynes thought eugenics was more important, more significant, and more genuine than economics.

Eugenics — or the control of reproduction — is a very old idea.

Euro bonds could be a step too far for the German public

Germany Looks to Its Own Costly Reunification in Resisting Stimulus for Greece

By NICHOLAS KULISH

MUNICH — When Germany wants to understand Greece and the crisis afflicting Europe it not only looks south to the Continent’s periphery but also turns inward, to the former East Germany, still struggling more than two decades after German reunification.

To an extent not often appreciated by outsiders, the lessons provided by that experience — with the nation pouring $2 trillion or more into the east, by some estimates, to little immediate benefit — color the outlook and decisions of policy makers and the attitudes of voters, a majority of whom would like to see Greece leave the euro zone, polls show.

More on the Greek Banking Calamity

The ultimate in 'extend and pretend' schemes

Greece's biggest banks, their decline in market cap and the loss of deposits since January 2010 (evidently the past several weeks of withdrawals are not yet visible on this chart).

Rumors have been making their way over the wires on Tuesday that the four largest Greek banks will receive € 18 billion in the form of 'EFSF bonds' on Friday in a first tranche of the recapitalization effort that is part of Greece's latest bailout deal. The report was updated several times during the day, until Friday had morphed into 'perhaps Wednesday'.  Below is an excerpt of the report as it appeared at Reuters:

„Greece's bank stability fund approved an 18 billion euro ($22.96 billion) injection to rescue its four largest banks on Tuesday, and an official said they would get the urgently needed funds as soon Wednesday.

Bigger Than Facebook

Spending four years of your life starting off in the world of work rather than going into debt

By Robert Tracinski

With the less-than-spectacular launch of the Facebook IPO, I've heard a number of people speculating that the social networking boom is played out and that innovation will now turn elsewhere. I think they're missing out on a big area that is still left to conquer, an Internet breakthrough that will be way bigger than Facebook.

The rap against Facebook is that the activity it captures--essentially, a half billion people gossiping about their own lives--is so ephemeral that it could all disappear overnight, which is essentially what happened to Facebook's precursor, MySpace. As Rich Lowry put it, Mark Zuckerberg is basically the Henry Ford of goofing off. By the way, for my Facebook friends, let me add that I think this criticism is unfair. I've found Facebook useful, for example, as a news feed where people I know post interesting articles they have come across. But imagine if much of the same technology were used to capture an activity with far more substantial and enduring value.

Property Rights and Fishery Conservation

The tragedy of the commons

By Jonathan H. Adler

Fisheries continue to be among the best examples of the tragedy of the commons in action. As Garrett Hardin himself noted in his 1968 essay, "the oceans of the world continue to suffer" from the dynamic of the commons. Alas, little has changed. Ocean fisheries remain in trouble, as study after study reveals. Most fisheries around the globe are fully or over-exploited, and a substantial number have already faced collapse. The problem with fisheries management runs deep. 

Consumer 3D Printer

Markets in Everything

A $1,299 replicator for the home

Makeusof.com -- "Cubify understands the problem with geeky, DIY, hard to build and calibrate printers; and their Cube aims to solve this (pictured above). Currently on pre-order and due for release on May 25th, the device is about as consumer level as you can get.

At $1,299, it costs as much as a new desktop PC (and considerably less than the other leading consumer level 3D printer – the Makerbot Replicator) – but like all printers, they’ll get you on the cartridges! Yes, you heard me right – the Cube eschews traditional standardized filament rolls in favor of device-specific filament cartridges, with a variety of garish colors available for $50 each. The simplified loading process means switching out colors or loading a new cartridge is easy."

Should Black People Continue To Tolerate Black-On-Black Crime?

A True Epidemic

By WALTER E. WILLIAMS

Each year, roughly 7,000 blacks are murdered. Ninety-four percent of the time, the murderer is another black person.

According to the Bureau of Justice Statistics, between 1976 and 2011, there were 279,384 black murder victims. Using the 94% figure means that 262,621 were murdered by other blacks. Though blacks are 13% of the nation's population, they account for more than 50% of homicide victims.

Nationally, black homicide victimization rate is six times that of whites, and in some cities, it's 22 times that of whites. Coupled with being most of the nation's homicide victims, blacks are most of the victims of violent personal crimes, such as assault and robbery.

Paralyzing Vice Or Inventive Social Self-Defense?

Looking into Corruption

By George Handlery

It is elementary, that when you write about a term you should give its definition. In the case of corruption, we all know what is meant. This agreement does not help to get closer to a precise meaning that satisfies everybody at all times. Those that admit this and persist to give a definition are either fools or they write a weekly column. It is quite likely that the “or” can be omitted. 

Its omnipresence is what makes “corruption” as slippery as a freshly caught fish. We often become unaware participants because an innocent aspect is implied. This can make actions that open privileged opportunities not legally actionable and these are therefore not criminal. When I got my Swiss citizenship an official had to determine whether I am integrated. Due to assumptions he had reason to make in the light of my training, he skipped the obligatory questions about society and politics. Once he found out that I am a member of a local pistol club, being a participant himself, he visibly concluded that I “belong”. The case gets more complicated once other shared interests are exploited to pull the cart of a firm. For good reason, retired politicians are in demand as lobbyists. For the same reason, many countries limit their lobbying.

The Fraud Of Austerity

The collective memory loss

By Richard Rahn

Denial is leading to collective economic suicide in Europe and the United States. The French elected a socialist president who wants to raise taxes on those elusive rich and keep spending as if there is no tomorrow. 

Many on the left, including European socialists in tandem with the New York Times and its economist Paul Krugman, are falsely claiming that Europe and even the United States are being saddled with "austerity." Their claim is that governments are not spending enough to reduce unemployment. They want higher taxes on the most productive plus bigger government. 

The Seeds of the EU’s Crisis Were Sown 60 Years Ago

Can there be a fiscal without a political union?

By Clive Crook

The arc of Europe’s postwar history is turning toward tragedy. It isn’t just that much of the continent has fallen into a new Great Depression, or that in some countries things will get worse before they get better. It isn’t even that the whole mess was avoidable. It’s that the crisis is dividing Europe along the very lines the European project was intended to erase.

Decades of cliches about European solidarity and the European idea are being held up to ridicule. The argument that Britons, Germans, Greeks, Italians and Spaniards are instinctive cultural partners whose commonalities transcend their obvious differences and historical enmities -- that “Europe” is a real community, not just a heavily worked-over Brussels blueprint -- turns out to be, let’s say, disputable.

Ancient stereotypes frame conversation about the crisis. Germans are bossy and severe. Italians are idle. Greeks are corrupt. Brits are arrogant. The French are vain. So much for 60 years of European unification.

The Autism-Welfare Nexus

Another cycle of government dependency and poverty

By PAUL SPERRY

If Steve Jobs were a child today, his school no doubt would drag his parents into the office and tell them he was so difficult and disruptive he needed to be examined by a doctor.

His chastened parents, in turn, would take him to a pediatrician who more than likely would diagnose him with high-functioning autism and prescribe a daily regimen of Prozac or Ritalin.

Prescriptions in hand, his working-class parents could then apply for federal disability benefits. And his school could qualify for more federal aid.

Europe: The World’s Worst Dentist With the World’s Dullest Drill

Frightened and bored at the same time

By WALTER RUSSELL MEAD

The European monetary crisis is like a botched root canal: painful, expensive, interminable. Weeks, months and even years go by and the world helplessly sits in the chair as the incompetent dentists poke, scrape, bicker and endlessly, endlessly drill.  From time to time there are shots of Novocaine—usually in the form of liquidity injections from the ECB—that reduce the pain to a dull throb, but there are no signs of improvement, no signs that the long and futile European process is coming to any kind of successful conclusion.

We are frightened and bored at the same time: we can’t look away but we can’t bear to master the intricate details of this most tedious of world crises.

The Two Europes

Neither the long- or short-term futures look terribly bright

by FRANCIS FUKUYAMA

The Greek election on Sunday was a predictable disaster: the two mainstream parties, the socialist PASOK and the center-right New Democracy (ND), were displaced by new extremist parties that appeared on their right and left, including the left-wing Syriza and KKE (Communist) parties which won a quarter of the vote between them, and the right-wing Independent Greeks and Golden Dawn parties getting almost 18 percent.

The main issues in the campaign revolved around whether Greece should fulfill the terms of the pact that had been negotiated with the EU and IMF and continue the austerity that implied. None of the parties, however, was willing to take up what from the beginning was the source of Greece’s problems, and the reason it got into such trouble with its public debt in the first place, which is the country’s pervasive clientelism.

In Defense of Bank Runs

“Money is what the government says it is.”

By Detlev Schlichter

One with a liberal view might ask:

Is it really true that we have too-much state involvement in finance? Do we really have some form of monetary central planning? Does this view not completely underestimate the power of the big private banks?

When one looks at the gigantic positions these private banks have on their balance sheets (and the even bigger positions they have ‘off balance sheet’), and when one looks at the outsized bonuses the bankers pay themselves, and when one furthermore considers that most money-creation is done by the private banks, then it appears as if ‘central planning’ or ‘the power of the bureaucracy’ appear inaccurate descriptions of the present system.

After all, J.P. Morgan just admitted to losing $2 billion and counting on complicated derivative positions. How can that be the fault of central bankers or imaginary monetary ‘central planners’? Isn’t this the opposite of central planning? Is this not capitalism running amok?

Half Of Detroit’s Streetlights May Go Out As City Shrinks

A socialist experiment gone terribly wrong

By Chris Christoff

Detroit, whose 139 square miles contain 60 percent fewer residents than in 1950, will try to nudge them into a smaller living space by eliminating almost half its streetlights.

As it is, 40 percent of the 88,000 streetlights are broken and the city, whose finances are to be overseen by an appointed board, can’t afford to fix them. Mayor Dave Bing’s plan would create an authority to borrow $160 million to upgrade and reduce the number of streetlights to 46,000. Maintenance would be contracted out, saving the city $10 million a year.

The Best Way To Get A University Level Education For Free

How do you get and maintain lifelong learning?

By Tina Sieber

The idea that you are never done learning has never been more true than today. The Internet has revolutionized the way we access information and knowledge – formerly a luxury accessible only to the rich and highly gifted – which is now freely available to anyone with Internet access.

Education and learning should be a lifelong process and the Internet is your chance to get a university level education for free, regardless of where you are in life. This article introduces you to the three best websites to get started.

Unemployment Insurance Schemes

The Dependency Of Welfare

by James Miller

In the Garden of Eden there is no scarcity.  Food, clothing, and shelter are in abundance.  Resources merely fall from the heavens upon command.  It is economic paradise precisely because economics does not exist.  The universal laws that hold in the world of scarce goods vanquish in the land of the plenty.

The vision of Eden is the politician’s main source of employment.  That is, promising to lead the suffering masses toward utopia by government decree makes for great electoral results.  The voting fodder ignorant of economics falls in line to cast a ballot to grant themselves other people’s money.  But of course many voters don’t see it this way.  Their vision of the state is that of Eden.  They see the bureaucrats and enforcers capable of tapping an infinite pot of wealth to pass along prosperity to those subservient enough to put them in office.  This in turn has lead to the establishment of the welfare state and its plethora of entitlement programs.

The importance of "Middle Land"

A Ravening Justice

By Mark Steyn

To get the obvious out of the way: I loathe John Edwards. I loathe him as a slick ambulance-chasing trial lawyer, as a preening poseur of a presidential candidate, as a multi-bazillionaire "advocate" for "the poor," as a third-rate sob sister peddling faux-Dickensian guff about entirely mythical "coatless girls" lying in their beds shivering at night because their father was laid off at the mill. I loathe everything about him except his angled nape, which I must concede, having been pressed up against it in a campaign crush in New Hampshire, is a thing of beauty, and well worth every penny of whatever Rachel Mellon paid for it.

Double trouble

Bipartisanship Is Behind Government's Worst Programs

By GEORGE F. WILL

Bipartisanship, the supposed scarcity of which so distresses the high-minded, actually is disastrously prevalent.

Since 2001, it has produced No Child Left Behind, a counterproductive federal intrusion in primary and secondary education; the McCain-Feingold speech rationing law (the Bipartisan) Campaign Reform Act); an unfunded prescription drug entitlement; troublemaking by Fannie Mae and Freddie Mac; government-directed capitalism from the Export-Import Bank; crony capitalism from energy subsidies; unseemly agriculture and transportation bills; bailouts of an unreformed Postal Service; housing subsidies; subsidies for state and local governments; and many other bipartisan deeds.

“Fascism, n. A supreme belief in the superiority of action over thought.”

It is very easy to call for grand, magical, all-resolving action when one is in opposition

By Tim Price

“Working at my desk today was somewhat surreal. Global risk markets were closing out a dreadful week. Newswires were full of disconcerting articles – J.P. Morgan, Greece, Spain, Italy, China, etc. Meanwhile, CNBC was in the midst of blanket coverage of the Facebook initial public offering. Mark Zuckerberg rang the bell to open NASDAQ trading, while helicopters provided live video of the employee gathering at Facebook’s Menlo Park headquarters. Insiders are now worth billions, the “average” employee millions. Even U2’s Bono pocketed $1.2bn (with a “B”). I noted above how I see J.P. Morgan’s predicament as a microcosm of global financial woes. Well, it is difficult for me today not to see Facebook as emblematic of the incredible transfer of wealth associated with Credit Bubbles. It’s almost as if this historic Bubble has been waiting to end with just such an exclamation point.”                 

                         — From “The Jig is Up‟, by Doug Noland.

Birds of a Different Feather

The Austrians And The Swan

By Mark Spitznagel

What is a black swan event, or tail event, in the stock market?

✓ It depends on who’s asking.

✓ To those familiar with Austrian capital theory, the impending U.S. stock market plunge (of even well over 40%)—like pretty much all that came before in the past century—will certainly not be a Black Swan, nor even a tail event.

✓ Nonetheless, the black swan notion is paramount—in perception: Market participants’ failure to expect a perfectly expected event—that is, they price in only Anglo swans despite the Viennese bird lurking conspicuously in the weeds—much like what is happening today, brings tremendous opportunity.

I. On Induction: If it looks like a swan, swims like a swan, …

By now, everyone knows what a tail is. The concept has become rather ubiquitous, even to many for whom tails were considered inconsequential just over a few years ago. But do we really know one when we see one?

The Yankee Comandante

A story of love, revolution, and betrayal

William Alexander Morgan being applauded by Fidel Castro, in Havana in 1959. Morgan said that he had joined the Cuban Revolution because “the most important thing for free men to do is to protect the freedom of others.”

by David Grann

For a moment, he was obscured by the Havana night. It was as if he were invisible, as he had been before coming to Cuba, in the midst of revolution. Then a burst of floodlights illuminated him: William Alexander Morgan, the great Yankee comandante. He was standing, with his back against a bullet-pocked wall, in an empty moat surrounding La Cabaña—an eighteenth-century stone fortress, on a cliff overlooking Havana Harbor, that had been converted into a prison. Flecks of blood were drying on the patch of ground where Morgan’s friend had been shot, moments earlier. Morgan, who was thirty-two, blinked into the lights. He faced a firing squad.

Flirting with fascism

Why Europe can’t shake its weakness for Nazism

by Peter Goodspeed

Like vermin in a time of pestilence, neo-Nazi groups appear to be enjoying a resurgence in a Europe plagued by increasing financial chaos and uncertainty. As Europe celebrated the 67th anniversary of V.E. Day and the defeat of Hitler’s Nazis this week, it also reeled in disbelief as an angry Greek electorate gave 7% of their votes to the neo-Nazi, anti-immigrant Golden Dawn party.

One Nation (under Germany)

European Union will become, finally, a federal state

By Ben Laurance 

Where does it all end? What will be the outcome of the financial storm battering Europe and its single currency? Can the euro be saved? And if so, what will be the long­term consequences?

The financial historian Niall Ferguson, visiting London from his self­imposed exile in America to promote the paperback version of his most recent book, is typically confident that he has the answers to these difficult questions — and they are not what you might expect from this tireless proponent of free markets.

A Greek Exit Could Make the Euro Area Stronger

The Long Goodbye

By Jacob Kirkegaard

A Greek exit from the euro area would inflict heavy damage in Greece and throughout Europe. It could also be one of the best things that ever happened to the currency union.

Greece’s repeat parliamentary election next month will serve as a referendum on whether the country should end its 12- year membership in the common currency. An affirmative answer would trigger a cardiac arrest of the Greek economy, as the banking system collapsed and foreign suppliers refused payment in drachmas. The financial system of the euro area, by far Greece’s biggest international creditor, would suffer hundreds of billions of euros in losses.