A note to myself for an article from The Economist about Russian intervention in Ukraine.
The world has accepted Russian first step to 'invasion' of Ukraine. Putin has infiltrated eastern Ukraine but the West countries are hesitating to stop them as they considered the infiltration as not quite invasion. The interim government in Kiev is under threat of brink of civil war. The government has only poorly trained soldiers and if it fails to control, significant risk of more bloodshed will increase with. This will give the best chance to Mr Putin to stand up.
Russia insists they did not any part in conquest of towns but this is implausible. Troops in unmarked uniforms with Russian weapons carried assault in Crimea six weeks ago. For normal countries, peace and prosperity is benefit. But Russia considers instability is more beneficial under its current stagnant economy. By enhancing the instability, they attempt to stop presidential election due on May. Also this can justify their intervention. Mr Putin will bring his troops to exploit anarchy and bloodshed.
Such civil conflict will destroy authority of Kiev, followed by a parallel government. The west countries will gain certain comfort that there has been no invasion by Russia. But terrible pains are down to Ukrainian people. And such 'acceptance' by the West will create a misreading of Russian dangerous action. Mr Putin has established dangerous precedents from Ukrainian crisis. The crisis gave him to excuse for intervention to protect Russian speakers. This abolished the agreement signed in 1994 over Ukrainian border. He started to intervene and beyond the border. This precedent will give them to opportunity to apply same way to expand their troops in Kazakhstan and even in the Baltic states. The Baltics are member of NATO but if Russia starts to challenge to the West, the 'acceptance' by the West could lead to catastrophic results.
The West needs to demonstrate the potential costs to Mr Putin in case of his further action. European citizen might not bear with gas shortages, so embargo won't be the best option. The one of best option is announcement by NATO to exercise it's power in central and eastern Europe. Another option is sanction. Freezing dollars, euros and sterling will devastate Russian's economy. This will destroy Russian's revenue from oil and gas priced in dollars, dry up the cash flow for import pay. This will costly to the West too, especially in London but if doesn't bear the cost, the next bill will be much higher.
Note to myself for an article of the Economist about religion in employment
Employers in Western world faces difficulty in the management over employees' religious diversity. Employees increasingly expect to keep their own religious life style at their work place. A number of case of religious discrimination keeps increasing these days. Firms need to respect the attitude of workers inspired by religion and should not hide them away to avoid customers disrepute.
British Airway lost a lawsuit appealed by their employee who claimed the right to wear a cross with her uniform. Human Right Commission urge employers to provide religious allowance to employees as long as they don't infringe the others rights. An American cloth retailer sued by tow Muslim women who argued that they were victimised by wearing headscarves. Tesco was rebuked by employment tribunal for limitation of access to prayer-room from two Muslim employees. The bosses are under pressure in expressing their opinion on people's faith. One boss resigned due to his support of campaign to ban gay marriage.
Multinational firms are in more difficulty. Legal or constitutional definition of religious discrimination varies in countries. Many companies have changed their rules to meet employees religious needs. But situation is getting more complex as foreign-born workers are keep increasing. Latino workers might follow both Catholic and indigenous beliefs. Management skills for diversity is crucial talent.
One French firm banned conspicuous religious symbols by agreement with 4,000 employees. But this is exception. Most of French companies are reacting to the needs of religious demands.
An American firm was claimed by Muslim employees for their extra prayer breaks. The company tried to accept the requirement, but this was protested by non-Muslim workers due to extra costs to the business and eventually to the employees. The judge upheld the company's decision on the ground that the Civil Rights Act says the employers must accommodate religion as long as the this doesn't cause 'undue hardship' in business.
Employers in Western world faces difficulty in the management over employees' religious diversity. Employees increasingly expect to keep their own religious life style at their work place. A number of case of religious discrimination keeps increasing these days. Firms need to respect the attitude of workers inspired by religion and should not hide them away to avoid customers disrepute.
British Airway lost a lawsuit appealed by their employee who claimed the right to wear a cross with her uniform. Human Right Commission urge employers to provide religious allowance to employees as long as they don't infringe the others rights. An American cloth retailer sued by tow Muslim women who argued that they were victimised by wearing headscarves. Tesco was rebuked by employment tribunal for limitation of access to prayer-room from two Muslim employees. The bosses are under pressure in expressing their opinion on people's faith. One boss resigned due to his support of campaign to ban gay marriage.
Multinational firms are in more difficulty. Legal or constitutional definition of religious discrimination varies in countries. Many companies have changed their rules to meet employees religious needs. But situation is getting more complex as foreign-born workers are keep increasing. Latino workers might follow both Catholic and indigenous beliefs. Management skills for diversity is crucial talent.
One French firm banned conspicuous religious symbols by agreement with 4,000 employees. But this is exception. Most of French companies are reacting to the needs of religious demands.
An American firm was claimed by Muslim employees for their extra prayer breaks. The company tried to accept the requirement, but this was protested by non-Muslim workers due to extra costs to the business and eventually to the employees. The judge upheld the company's decision on the ground that the Civil Rights Act says the employers must accommodate religion as long as the this doesn't cause 'undue hardship' in business.
A note to myself for an article from The Economist about Biritain's housing market.
British housing market is described as food in a microwave. The market temperature can be heated up for a few seconds. The house price rise was predominantly in central London by 2013. Property was considered shelter from economic turmoil abroad and foreign cash flooded into the market in London. In 2013, property price of London increased by 13.2% but the inflation started spreading across Britain and chunky increases can be seen in everywhere now.
The heated market makes it harder for first-time buyer to find a property, but the prices apart from London remains 16% lower than the peak of pre-crisis. Borrowing costs have eased due to glut of savings, and this enable buyers to purchase lager property. This trend is unlikely reversed soon.
However, the market prices appears bubbles. People are rushing to buy houses on the assumption that price will keep climbing. Although the direct impact of current government schemes for subsidise higher-risk mortgages seems moderate, this broadly affect the prices. Borrowers attempt to stretch their finance. The average of new loan for first-time buyers is 3.4 times of their income in 2013. Barclays offers mortgages up to 5.5 times of borrower's income now.
But when interest rates eventually increase, borrowers will struggle. A wave of mortgage defaults will cause next financial crisis with fall of house prices. The Bank of England is watching for such vulnerable market. While politicians are encouraged to rise house prices for next year's general election, the Financial Policy Committee (FPC) of BoE can take a long-term perspectives.
From April, banks need to check whether there is spare cash by applicants even if the interest rates gone up to 3%. FPC has requested to impose higher interest rate test by summer. Or FPC can forcing lenders to hold sufficient buffer as to absorb a shock, which will deter them from taking higher risks.
Poorer people will need to save more money. Wealthy home-owner will lose a confidence on price rising. The exchequer, George Osborne will regret the heat out of housing boom before election. But FPC should be independent and not hesitate to take action.
British housing market is described as food in a microwave. The market temperature can be heated up for a few seconds. The house price rise was predominantly in central London by 2013. Property was considered shelter from economic turmoil abroad and foreign cash flooded into the market in London. In 2013, property price of London increased by 13.2% but the inflation started spreading across Britain and chunky increases can be seen in everywhere now.
The heated market makes it harder for first-time buyer to find a property, but the prices apart from London remains 16% lower than the peak of pre-crisis. Borrowing costs have eased due to glut of savings, and this enable buyers to purchase lager property. This trend is unlikely reversed soon.
However, the market prices appears bubbles. People are rushing to buy houses on the assumption that price will keep climbing. Although the direct impact of current government schemes for subsidise higher-risk mortgages seems moderate, this broadly affect the prices. Borrowers attempt to stretch their finance. The average of new loan for first-time buyers is 3.4 times of their income in 2013. Barclays offers mortgages up to 5.5 times of borrower's income now.
But when interest rates eventually increase, borrowers will struggle. A wave of mortgage defaults will cause next financial crisis with fall of house prices. The Bank of England is watching for such vulnerable market. While politicians are encouraged to rise house prices for next year's general election, the Financial Policy Committee (FPC) of BoE can take a long-term perspectives.
From April, banks need to check whether there is spare cash by applicants even if the interest rates gone up to 3%. FPC has requested to impose higher interest rate test by summer. Or FPC can forcing lenders to hold sufficient buffer as to absorb a shock, which will deter them from taking higher risks.
Poorer people will need to save more money. Wealthy home-owner will lose a confidence on price rising. The exchequer, George Osborne will regret the heat out of housing boom before election. But FPC should be independent and not hesitate to take action.
A note to myself for an article from The Economist about history of financial crisis and provision for the next.
Ever since the financial crisis in 2008, it has been common understanding that this was caused by loss of control over finance by government. The answer to this was more rules. The government plans to set up a public backstop to mortgage market by insuring 90% of losses in crisis. This will leave two concerns. First, it appears there is nothing to prevent excessive risk-taking. Second, the housing market has already been well regulated with lending decision taken by the state.
Back in 1856, Walter Bagehot criticised 'blind capital' such as cash flooded into unwise investments ignoring risks. He invented a system of central bank to rescue banks in crisis. The irony is that, as the result, the government was forcing bankers to take as much risks as possible. The more state protected the system, the more people took risks without punishment.
During the boom in 2007-08, gains from risk-taking were into banker's pockets and the bill was passed to taxpayers when the babble went pop. Since then, loads of new rules have been enacted. These are trying to boost bank's capital and liquidity with self-reliance. Now American banks need to clear tough leverage ratio. But these regulations are still heavily depends on state suport.
American citizen are protected for their deposit up to $250,000 in any bank. This discourage people to check the health status of the banks. In most of countires, the government gives incentive the companies or individuals to take borrowings by allowing them to deduct tax utilising the borrowing costs. Since investors know the government will bail out the banks, they takes more risks. They have also used funding subsidy for shareholder's pockets for decades. The subsidy in rich countries is $630 billion, which is more than Sweden's GDP. This is distorting risk-taking principle.
Regulations have responded to each crisis in the history. These created modern financial system, including some successful innovations of Federal Reserves and New York Exchange. But these also left corrosive trend, which is state involvement. The deposit insurance protect cash in bank deposited by individual. Under this protection, investors ignore creditworthiness but more focus on interest rates. Debt-fuelled housing is soaring while machines and patents runs dry up with investments.
Deposit insurance should be gradually reduced. Bank might start emphasising their credibility and capital ratio. Punishment should be considered to be charged on investors rather than taxpayer for their failure. Winding megabank and loss-absorbing bonds will also need to be addressed. The difficulty is to resolve large cross-border banks.
The government should make the costs of support explicit. Subsidy and deposit insurance must be reported as liabilities in the national accounts. The scope of costs borne by the government is now well beyond banks to undercapitalised clearinghouses and money-market funds. It is easy to set up the next crisis.
Ever since the financial crisis in 2008, it has been common understanding that this was caused by loss of control over finance by government. The answer to this was more rules. The government plans to set up a public backstop to mortgage market by insuring 90% of losses in crisis. This will leave two concerns. First, it appears there is nothing to prevent excessive risk-taking. Second, the housing market has already been well regulated with lending decision taken by the state.
Back in 1856, Walter Bagehot criticised 'blind capital' such as cash flooded into unwise investments ignoring risks. He invented a system of central bank to rescue banks in crisis. The irony is that, as the result, the government was forcing bankers to take as much risks as possible. The more state protected the system, the more people took risks without punishment.
During the boom in 2007-08, gains from risk-taking were into banker's pockets and the bill was passed to taxpayers when the babble went pop. Since then, loads of new rules have been enacted. These are trying to boost bank's capital and liquidity with self-reliance. Now American banks need to clear tough leverage ratio. But these regulations are still heavily depends on state suport.
American citizen are protected for their deposit up to $250,000 in any bank. This discourage people to check the health status of the banks. In most of countires, the government gives incentive the companies or individuals to take borrowings by allowing them to deduct tax utilising the borrowing costs. Since investors know the government will bail out the banks, they takes more risks. They have also used funding subsidy for shareholder's pockets for decades. The subsidy in rich countries is $630 billion, which is more than Sweden's GDP. This is distorting risk-taking principle.
Regulations have responded to each crisis in the history. These created modern financial system, including some successful innovations of Federal Reserves and New York Exchange. But these also left corrosive trend, which is state involvement. The deposit insurance protect cash in bank deposited by individual. Under this protection, investors ignore creditworthiness but more focus on interest rates. Debt-fuelled housing is soaring while machines and patents runs dry up with investments.
Deposit insurance should be gradually reduced. Bank might start emphasising their credibility and capital ratio. Punishment should be considered to be charged on investors rather than taxpayer for their failure. Winding megabank and loss-absorbing bonds will also need to be addressed. The difficulty is to resolve large cross-border banks.
The government should make the costs of support explicit. Subsidy and deposit insurance must be reported as liabilities in the national accounts. The scope of costs borne by the government is now well beyond banks to undercapitalised clearinghouses and money-market funds. It is easy to set up the next crisis.
When we are young, we often imagine the world surrounding us is unlimited and adventurous stories are waiting for us. It is true only when we actually take action to walk out toward invisible place from current comfortable space. But most of our life was spent up in quite small cage. The life in cage itself seems not bad as it is said badly. No big surprise and no dynamics might spoil people but such steady life enables people to be emotional against small changes. This might eventually almost same as the others are in dynamic world. This can be compared to a relationship of telescope and microscope. But why do the most of people still yearn for new world?
The gigantic market of films and fiction books provide evidence of this. We want to know the unknown story and open the door to unlimited world. There are so many devices and applications make us to easily contact or open to the world these days. We can virtually walk on one of unknow street in Moscow using Google map. The world latest news are accessible by anywhere we can have internet access. You can talk to someone who is living the opposite side of the earth through Skype without worry of costs. There is no doubt that cheep flight carrier encourages people to go abroad. More options of hotel booking are available for us by various online agency site. We can obtain local information such as promising restaurants rather than tourist trap. Our travel are, nowadays, incredibly comfortable.
But in return of such easy travel, we lost something. Super smooth travel makes us to avoid wasting our time and money spent in trouble or wrong decisions. This also removes accident and surprise from us. 'Travel' is just tracing our planned route now. This can't be called 'adventure' anymore. This is a trap for us that we eager unknown and invisible new world but also reluctant to take a risk. Both are our nature of human being. Real 'adventure' can be found only we take real 'risk'. Technology enable us to expand our scope of vision from the cage, but this itself won't get us out of the cage. We still need to pay some pains, say taking a risk, to open the door and go out from the cage.
There is no guarantee that the new or unknown world will bring you a bunch of flowers. Quite often, these make you messed up. But it is true that the story you experience including positive and negative will add dynamics in your life. If you are waiting until you've obtained sufficient knowledge and confidence with you before jumping out, you might miss many chances while your are preparing for it. When you pop out from the current cage, I'm sure that there are many troubles discouraging you from keeping walking out. But it's also true that we can work it out somehow. The events you experienced on your travel become a story someday, which can't be replaced with any other common tale. This is what is called an adventure.
The gigantic market of films and fiction books provide evidence of this. We want to know the unknown story and open the door to unlimited world. There are so many devices and applications make us to easily contact or open to the world these days. We can virtually walk on one of unknow street in Moscow using Google map. The world latest news are accessible by anywhere we can have internet access. You can talk to someone who is living the opposite side of the earth through Skype without worry of costs. There is no doubt that cheep flight carrier encourages people to go abroad. More options of hotel booking are available for us by various online agency site. We can obtain local information such as promising restaurants rather than tourist trap. Our travel are, nowadays, incredibly comfortable.
But in return of such easy travel, we lost something. Super smooth travel makes us to avoid wasting our time and money spent in trouble or wrong decisions. This also removes accident and surprise from us. 'Travel' is just tracing our planned route now. This can't be called 'adventure' anymore. This is a trap for us that we eager unknown and invisible new world but also reluctant to take a risk. Both are our nature of human being. Real 'adventure' can be found only we take real 'risk'. Technology enable us to expand our scope of vision from the cage, but this itself won't get us out of the cage. We still need to pay some pains, say taking a risk, to open the door and go out from the cage.
There is no guarantee that the new or unknown world will bring you a bunch of flowers. Quite often, these make you messed up. But it is true that the story you experience including positive and negative will add dynamics in your life. If you are waiting until you've obtained sufficient knowledge and confidence with you before jumping out, you might miss many chances while your are preparing for it. When you pop out from the current cage, I'm sure that there are many troubles discouraging you from keeping walking out. But it's also true that we can work it out somehow. The events you experienced on your travel become a story someday, which can't be replaced with any other common tale. This is what is called an adventure.