Xi Jinping Doubles Down on His Putin Bet. ‘I Have a Similar Personality to Yours.’

   Date: 15‑12‑2022

Source: The Wall Street Journal

The Chinese leader has long admired Vladimir Putin. Now, he is strengthening ties between the two nations with increased trade and energy partnerships.

China’s leader Xi Jinping has in recent months tried to put public distance between Beijing and Moscow as Russia has suffered defeats in its war on Ukraine.

Behind the diplomatic appearances, however, Mr. Xi is deepening his long‑term bet on Russia.

In recent weeks, he has instructed his government to forge stronger economic ties with Russia, according to policy advisers to Beijing, building on a trade relationship that has strengthened this year and become a lifeline to Moscow in the face of Western pressure.

The End of the New Peace

   Date: 14‑12‑2022

Source: The Atlantic By Yuval Noah Harari

Vladimir Putin is pushing humanity toward an era of war that might be worse than anything we have seen before. It could threaten the very survival of our species.

Mother and son holding hands, walking past Soviet tanks

A few years ago, I published a book called 21 Lessons for the 21st Century, and dedicated one of the chapters to the future of war. Subtitled “Never underestimate human stupidity,” this chapter argued that the first decades of the 21st century had been the most peaceful era in human history, and that waging war no longer made much economic or geopolitical sense. But these facts did not absolutely guarantee peace, because “human stupidity is one of the most important forces in history” and “even rational leaders frequently end up doing very stupid things.”

How the West fell out of love with economic growth

   Date: 12‑12‑2022

Source: The Economist

A serious, slow‑burning malaise

This year has been a good one for the West. The alliance has surprised observers with its united front against Russian aggression. As authoritarian China suffers one of its weakest periods of growth since Chairman Mao, the American economy roars along. A wave of populism across rich countries, which began in 2016 with Brexit and the election of Donald Trump, looks like it may have crested.

Yet away from the world’s attention, rich democracies face a profound, slow‑burning problem: weak economic growth. In the year before covid‑19 advanced economies’ gdp grew by less than 2%. High‑frequency measures suggest that rich‑world productivity, the ultimate source of improved living standards, is at best stagnant and may be declining. Official forecasts suggest that by 2027 per‑person gdp growth in the median rich country will be less than 1.5% a year. Some places, such as Canada and Switzerland, will see numbers closer to zero.

The Birth of a New International Order

   Date: 10‑12‑2022

Source: Project Syndicate by Joschka Fischer

Joschka Fischer, Germany’s foreign minister and vice chancellor from 1998 to 2005, was a leader of the German Green Party for almost 20 years. 

The remnants of the twentieth century’s bipolar order are finally disappearing, making way for a new global pentarchy. The United States and China will be the dominant players in the twenty‑first century, but Europe, Japan, and India will also be able to exercise meaningful influence over large swaths of the planet.

BERLIN – We are witnessing an unprecedented confluence of major and minor crises. From the COVID‑19 pandemic, surging energy prices, and the return of inflation in developed and developing economies, to fractured supply chains, Russia’s criminal war in Ukraine, and climate change, many of these crises are signs not just of decay but of a new world order being born.

Has China reached the peak of its powers?

Date: 29‑11‑2022

Source: The Economist

Xi Jinping has set himself up for a difficult year

TOPSHOT ‑ China’s President Xi Jinping waves during the introduction of members of the Chinese Communist Party’s new Politburo Standing Committee, the nation’s top decision‑making body, to the media in the Great Hall of the People in Beijing on October 23, 2022.

Even in his moment of triumph, Xi Jinping admitted that dark clouds hang over China. At the Communist Party’s five‑yearly congress in October 2022, Mr Xi secured a precedent‑trampling third term as party chief. Speaking before some 2,300 party delegates in Beijing, the “helmsman”, as he is now called in state media (with worrying echoes of the worship of Mao Zedong more than half a century ago), described a decade of mostly smooth sailing under his rule. Extreme poverty has been eliminated and his “zero‑covid” policy saved lives, he said. The party had “effectively contained ethnic separatists, religious extremists and violent terrorists”, he boasted, using rather loose definitions of each. But he also warned party leaders to “be ready to withstand high winds, choppy waters and even dangerous storms”.

The AI myth Western lawmakers get wrong

Date: 29‑11‑2022

Source: Technology Review By Melissa Heikkilä

Plus: How a bot that watched 70,000 hours of Minecraft could unlock AI’s next big thing.

While the US and the EU may differ on how to regulate tech, their lawmakers seem to agree on one thing: the West needs to ban AI‑powered social scoring.

As they understand it, social scoring is a practice in which authoritarian governments— specifically China—rank people’s trustworthiness and punish them for undesirable behaviors, such as stealing or not paying back loans. Essentially, it’s seen as a dystopian superscore assigned to each citizen.

The EU is currently negotiating a new law called the AI Act, which will ban member states, and maybe even private companies, from implementing such a system.

FRIDAYS FOR FUTURE IN FINANCE

FURCHE-Kolumne 359   Wilfried Stadler               

Das Drängen der Jungen hat sich gelohnt: die Notwendigkeit eines klimaschonenden Umgangs mit den begrenzten natürlichen Ressourcen steht endlich weltweit außer Streit. In letzter Zeit ertappe ich mich dabei, mir eine vergleichbare Veränderungs-Energie für die globale Finanzwirtschaft zu wünschen. Gewissermaßen eine „Fridays for Future of Finance“-Initiative. Auch wenn das nach einem Wunsch ans Christkind klingt.  

So wie Klimaschutz und saubere Umwelt ist nämlich auch „Finanzstabilität“ ein zentrales, im Interesse der Allgemeinheit liegendes öffentliches Gut. Dabei geht es zum einen um Geldwertstabilität als dem zentralen Ziel von Notenbanken – ein Feld auf dem sich die Europäische Zentralbank (EZB) trotz der Krisen-Kaskade der letzten Jahre durch den Einsatz eines ganzen Arsenals an zuvor weitgehend unbekannten Instrumenten weitgehend erfolgreich geschlagen hat.

Finanzstabilität im umfassenderen Sinn beinhaltet jedoch mehr als den Erhalt von Geldwerten. Es gilt vor allem sicherzustellen, dass von Finanzkrisen ausgelöste Instabilitäten nicht auf die Staatshaushalte durchschlagen und damit künftige Generationen belasten. Oder, anders: dafür zu sorgen, dass die Geldwirtschaft in erster Linie der wertschöpfenden Realwirtschaft dient.

Gerade hier aber zeigen sich bei näherem Hinsehen gravierende Systemschwächen. So führen an Tageswerten orientierte Bilanzregeln im Aufschwung zur spekulativen Aufblähung von Vermögenswerten und im Abschwung zu völlig überzogenen Abwertungen. Zugleich verdünnen sich im Abschwung die durch so genannte „Risiko-Gewichtung“ zuvor künstlich schöngerechneten Eigenkapitalpolster von Großbanken rapide. Krisen werden so verstärkt statt eingedämmt. 

Dazu kommt die intransparente, wachsende Welt der Schattenbanken sowie latente Bedrohungen durch unregulierte, spekulative Finanzprodukte. Ungedeckte Leerverkäufe oder mit viel zu hohen Krediten gehebelte Optionen können bei starken Preisschwankungen jederzeit entgleisen und zur Zündschnur einer nächsten Finanzkrise werden. Die Milliarden-Pleite der amerikanischen Kryptoplattform FTX – der bisher spektakulärste einer ganzen Reihe von Zusammenbrüchen ähnlicher Kunstgeld-Pyramiden allein in diesem Jahr – verweist auf ein weiteres Feld voll von gefährlichen, regulatorisch vernachlässigten Sprengsätzen im globalen Finanzsystem.  

Es ist hoch an der Zeit, dass Notenbanken initiativ werden, um Finanzstabilität in diesem umfassenderen Verständnis sicherzustellen, statt sich in banken-regulatorischem Kleinkram zu verlieren, wie das zuletzt bei den Regeln für Immobilienkredite zu besichtigen war. In Kooperation mit dem dafür zuständigen, von den G20-Staaten 2009 gegründeten Finanzstabilitätsrat mit Sitz in Basel müssten sie endlich den Mut aufbringen, tabuisierte Reformthemen anzugehen. Wie viele Wake-up-Calls braucht es noch, bis die von spekulativen Interessen der großen „Player“ diktierten Denkverbote durchbrochen werden? Bei der Lösung dieser Frage hilft kein Warten auf eine Jugendbewegung!

1.Dezember 2022

Done With Deglobalization?

Date: 27‑11‑2022

Source: Project Syndicate Michael Spence

Michael Spence, a Nobel laureate in economics, is Professor of Economics Emeritus and a former dean of the Graduate School of Business at Stanford University. He is Senior Fellow at the Hoover Institution, Senior Advisor to General Atlantic, and Chairman of the firm’s Global Growth Institute. He serves on the Academic Committee at Luohan Academy, and chairs the Advisory Board of the Asia Global Institute. He was chairman of the independent Commission on Growth and Development, an international body that from 2006‑10 analyzed opportunities for global economic growth, and is the author of The Next Convergence: The Future of Economic Growth in a Multispeed World (Macmillan Publishers, 2012).

 The global economy’s dire and deteriorating prospects, together with the scale of the climate challenge, have apparently opened world leaders’ eyes to the risks that deglobalization poses. But it remains to be seen whether this realization will be followed by the action needed to reverse course.

HONG KONG – November was an extraordinary month. Global leaders gathered for four major meetings: the ASEAN meeting in Cambodia, the G20 summit in Indonesia, the Asia‑Pacific Economic Cooperation (APEC) forum in Thailand, and the United Nations Climate Change Conference (COP27) in Egypt. What was striking wasn’t the timing of the meetings, but rather the evidence they produced that the tide might be turning away from confrontation toward renewed cooperation in the international arena.

Big Tech Gets Derailed

   Date: 27‑11‑2022

Source: Project Syndicate by Jonathan Levy

Jonathan Levy, a professor in the Department of History and the Committee on Social Thought at the University of Chicago, is the author of Ages of American Capitalism: A History of the United States (Random House, 2021). 

Much of what Big Tech values is praiseworthy, from fun (a good thing) to wondrous creativity. But, like similar episodes in the nineteenth century, the meltdown of FTX, and the turmoil engulfing Twitter and Meta, have exposed the costs of blindly worshiping enterprise and wealth.

CHICAGO – The failure of the cryptocurrency exchange FTX, the latest in a long history of American financial shenanigans, was a doozy. “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” said the corporate restructuring specialist John Ray III, who is now overseeing FTX’s bankruptcy.

The FTX collapse is only the latest in a sector that has been pummeled since April 2021, when the value of crypto first dropped. But it’s not just crypto. After markets sliced $89 billion off Meta’s market capitalization, CEO Mark Zuckerberg announced he was shedding 13% of the company’s workforce (11,000 people). Then, within days of Elon Musk’s takeover of Twitter, which he purchased – apparently on a lark – for $44 billion, many began to fear for the platform’s future.

Will the West Give in to Russia?

Date: 27‑11‑2022

Source: Project Syndicate

Since Russia’s invasion of Ukraine nine months ago, the West has not only delivered nearly $100 billion in aid to Ukraine, but also imposed unprecedented economic and financial sanctions on Russia. But with Europe facing the specter of energy shortages and some US lawmakers threatening to slash support for Ukraine, fears are mounting that the West could succumb to war fatigue. 

In this Big Question, we ask Shlomo Ben‑Ami, Simon Johnson, Salome Samadashvili, and Charles Tannock whether the West’s resolve is weakening and what such a development might mean.

Featured in this Big Question

 Shlomo Ben‑Ami, a former Israeli foreign minister, is Vice President of the Toledo International Center for Peace and the author of Prophets without Honor: The 2000 Camp David Summit and the End of the Two‑State Solution (Oxford University Press, 2022).

 Simon Johnson, a former chief economist at the International Monetary Fund, is a professor at MIT’s Sloan School of Management and a co‑chair of the COVID‑19 Policy Alliance. He is the co‑author (with Jonathan Gruber) of Jump‑Starting America: How Breakthrough Science Can Revive Economic Growth and the American Dream and the co‑author (with James Kwak) of 13 Bankers: The Wall Street Takeover and The Next Financial Meltdown.

 Salome Samadashvili, a former head of Georgia’s Mission to the European Union, is a member of Georgia’s parliament and Political Secretary of the Lelo for Georgia party.

Charles Tannock, a former member of the European Parliament Foreign Affairs Committee, is a fellow at GLOBSEC, a think tank based in Bratislava committed to enhancing security, prosperity, and sustainability.

SHLOMO BEN‑AMI

The economic hardship Western populations are facing today is inextricably linked to the war in Ukraine. The overwhelming economic and military support these governments have provided to Ukraine in its heroic stand against the Russian invasion could be sustained only as long as the public’s compassion for Ukrainians outweighed the pain of sanctions and the fatigue that comes with a protracted, seemingly endless slog.