Category Archives: World

Rogue French Investor

This sounds like the making of an exciting stock market movie (if there could be such a thing.)

By Friday, January 18, Jérôme Kerviel, a junior suit in the banking world, was on the hook for €50 billion – the equivalent of about half of all the gold and currency reserves held by France. The sum also exceeded the entire value of the bank at which he worked.

The 31-year-old trader at Société Générale, one of France’s most prestigious institutions, had secretly set up a series of deals that were going horribly wrong. So wrong that they threatened the survival of the bank and the health of global financial markets.

The directors faced a stark choice. They could let Kerviel’s trades – essentially bets that the market would rise – run in the hope of markets recovering. But that risked even greater losses if shares continued to fall. Or they could close the positions and take the hit.

It was no choice really. The potential losses if shares continued downwards could destroy the bank. “I did my duty and decided to unwind these positions,” said Daniel Bouton, the chairman. The bank later accepted a lifeline from two big American banks to escape the financial black hole.

The timing could not have been worse. Fears of recession and the debt crisis had sent shivers through the stock markets. On Monday morning the Asian markets were already falling by the time trading started in Paris. Soc Gen was a forced seller in plummeting markets – during that day leading shares in London collapsed 5.5% and in Paris 6.8%. This only compounded Soc Gen’s losses.

By the time it had managed to close out all Kerviel’s positions, the bank was down almost €5 billion. And Kerviel was being blamed for fuelling a stock market nosedive that spurred the American Federal Reserve into the biggest cut in interest rates for 25 years. He was described by the governor of the Bank of France as “a genius of fraud”.

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What is Russia doing?

Or I guess I could say, “What is Putin doing?”

Vladimir Putin dropped two bombs this week. One, literally, tested a ferocious explosive device. The other – his naming of a virtual unknown as prime minister and potential heir – was a political shock. The flash from both illumines his own power, and his quest to restore Russia’s greatness. Unpredictable Putin


This is all about elections next year. Putin is not allowed to run again. So what does he do? He picks his prime minister, a complete nobody–he was a crony in St. Petersburg, and he is a loyalist–to become the prime minister. And he might be a candidate next year.

The way that Putin entered office was that Yeltsin at the end of his second term appointed Putin, also obscure at the time, as the prime minister, and then in about a year he became the president.

The most important event in Russia in the last few weeks was the release of the Putin vacation pictures, the ones we saw a few weeks ago, which all of a sudden exploded on soviet Russian TV, which Putin controls, showing him shirtless on vacation in Siberia like the Marlboro man.

This is essentially saying to the Russians here is a young, vigorous president with good abs. Why would you not want to have him returned? Even though the constitution says he can’t, unlike Yeltsin, who was old and dying and decrepit at the end of his second term.

This is all about how Putin holds on to power. And, presumably, he might have a factotum like, this new guy, this unknown guy in office for a couple of years. He resigned and Putin is allowed to come back and run again, and almost indefinitely. Special Report Roundtable: Putin’s Russia


Now, about that other bomb, the world’s most powerful nonnuclear bomb. That display of force, dubbed the “father of all bombs,” was meant to show up America’s weaker “mother of all bombs.” It’s part of Putin’s push to restore Russian “greatness,” especially militarily.

The 1991 breakup of the Soviet Union and the subsequent expansion of NATO put Russia on the defense. Putin tired of that. He’s pouring petro rubles into the military. He’s standing up to the West: using fuel supplies as a political weapon; pulling out of a NATO conventional arms deal; planting the Russian flag on the Arctic seafloor, and last month, suddenly resuming air-bomber patrols over the Pacific, Atlantic, and Arctic. What will Russia pull next? As at home, unpredictability is at work abroad. Unpredictable Putin


And he is also done things that revive cold war tensions. They are now flying the old fashioned bear bombers. They are obsolete, but nonetheless they are flying against our air defenses in Alaska and against Japanese air defenses in Japan, testing them out. Checking out to see–it is all the old stuff again. Special Report Roundtable: Putin’s Russia

Kind of scary, huh?

A comment on the Iraq troop surge

How to think about conditions in Iraq, General Petraeus’ testimony before Congress, and what we need to do next – Sep 13, 2007 (comment by William C. Martel, Assoc. Professor of International Security Studies)

The Iraq war is the most critical foreign policy issue facing the American people. For moral, political, and strategic reasons, we cannot afford to suddenly, prematurely withdraw U.S. forces without plunging Iraq into a genocidal sectarian war for which we would be responsible.

For the first time, there are tangible signs of progress.

First, violence is down across Iraq, as virtually all studies show. In General Petraeus’ testimony yesterday, his chart “Iraq Violence Trends” shows less violence in Baghdad and several provinces. The number of “High Profile Attacks” is down. Overall, the number of daily attacks against US/coalition forces and Iraqi civilians declined between August 2006 and now.

Here at home, violence in Iraq is the primary measure used by policymakers and citizens to judge conditions in Iraq. With the US troop surge, there are signs — tentative, but nonetheless promising — that something positive might be happening in Iraq.

Second, when we compare General Petraeus’ briefing to Congress with other studies on Iraq, the differences are not significant. Despite differences — reflecting disagreements about data or interpretation — the general consensus is that violence in Iraq is down but still too high, the surge in US troops has helped, while political progress by the Iraqi government remains disappointing.

Third, signs of progress in Iraq give us an opportunity to end political warfare at home. While progress is less than what everyone wants, it provides the basis for a consensus among warring US political factions. For the good of the country, Democrats and Republicans must forge a national consensus on Iraq.

Morally, we cannot leave Iraq without being responsible for a sectarian bloodbath. Politically, we cannot abandon a state to which we committed ourselves. Strategically, we cannot afford chaos in the Middle East, which produces 20 percent of the oil we use every day.

Where do we go from here? With signs of progress, the right thing is to give Iraqis a “decent interval” for reconciliation. We must end America’s national spasm of partisan politics and do the right thing for Iraq.


Anne Frank family papers (photos)

BBC News photo collection showing previously unknown cache of papers related to Anne Frank, one of the most famous victims of the Holocaust. The documents note that her family tried to have her emigrate to the United States, but was unable to obtain a visa because of the difficulty of traveling from Amsterdam to an American Consul in Portugal, Spain, Free France, or Switzerland during the Nazi occupation of Europe.

Nikola Kavaja: Interview with an assassin

Check out this incredible interview. It reads like a Clancy novel! There is some rough language, which I do not condone, but it does fit well with Mr. Kavaja’s image.

Nikola Kavaja lives in a drab, Communist-era high-rise in Belgrade, Serbia’s crumbling capital. His two-room apartment is sparsely furnished: a single mattress and dresser in one room, and a scratched-up wooden desk, a couch, and a bench press in the other. The white walls are cluttered with pictures of the people who figure most strongly in his personal iconography: General Ratko Mladic, Saint Sava, Hitler, Jimmy Carter, and a young pin-up who is his current girlfriend. Guns and old military gear provide further ornamentation. A blue thermal blanket covers the street window.

By Christopher S Stewart
Published: 10 December 2006

Kavaja is 73, but he looks no older than 60. He adheres to a strict weight-training routine that gets him up every weekday before the sun. He is squarely built and muscular, with white hair cut to a military trim-line and a fighter’s mashed-up nose. Except for the fine white thread of moustache, he is cleanly shaven. In his dress, he favours black trousers, black shirts and black combat boots.

Our conversation took place over three mornings, with classical music playing softly in the background. Kavaja spoke slowly and quietly, with an air of determined precision. At times, he paused to place his hand on his forehead in search of a long-forgotten detail. As he spoke, Kavaja stared off in the distance at nothing at all, or else looked down at his booted feet.

Christopher S Stewart
You were a Second World War prisoner, a Communist soldier, a CIA hitman, a hijacker, and now a fugitive on the run (among other things). Where to begin?

Nikola Kavaja
Write down my name. N-I-K-O-L-A K-A-V-A-J-A. You can call me Nik.

Stewart That’s a start.

It is a long story. Do you want some schnapps?

Stewart No thanks. I’m fine with water.

Please continue reading: Interview with an Assassin

A Phone Call From Nicaragua

I just received an incredible phone call this evening. The caller id on my cell phone said “Unknown.” This usually means that someone on Skype is calling me… So I answered, expecting a friend. Instead, I hear: “Hello, Scott? Scott? How are you?” I have no idea who this is, so I ask who is calling and how he knows my name. It is pretty difficult to understand him and the line is crackly. Then I hear, “My name is Jose Manuel.” I could not believe it. This was a guy that I had met over a year ago (same summer when I went on the trip to Cyprus) in the small town of Comunidad El Bonete, Villanueva, Departamento de Chinandega. I had practiced my Spanish with him and he had worked on his English with me. He even had a CD player and had phonetically written out the lyrics to some American songs that he had. At the time, I would say that my Spanish was quite a bit better than his English. It was amazing how far along he had gotten in his English because he did not have an English-Spanish dictionary.

I was in Nicaragua doing a medical mission trip with a bunch of pre-med, med, dental, and vet students. We actually started in Costa Rica and then made our way up to Nicaragua. Staying in El Bonete was one of the highlights of the 2-week trip. The people of the village were very kind to host us in their homes for the 2 nights that we stayed there. It was a very interesting experience. Most of us slept in hammocks over the home’s dirt floor. I was fortunate enough to stay with Jose Manuel’s family…they were quite well off and had wood floors and access to a boombox. (I’m hoping that Jose will eventually have access to a computer because at that time he had not heard of it, the Internet, or email.) Some of our medical team actually slept with chickens running on the floor below their hammock!
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Top 10 U.S. Road Biking Routes

There’s a place we all want to go when we climb into the saddle of a bicycle.

For some people, it has a name; it is the “there yet” destination that children whine about when hunger, impatience, and nature call. It is the slam of the inside door and whir of the A/C fans and satisfaction of knowing that the hot bath and unplugged phone await. However, for many others, it is the semi-transcendence of just being on the way to wherever “there yet” is; it is the rush of merely being in the saddle, legs spinning, heart pumping and wind catching the grooves and corrugations of a snug Rock-locked helmet. The bath can wait, as can the hug of privacy. There is satisfaction in the groove of consistent motion that makes the trip to point B just as (if not more) exciting than actually B-ing there.

But even for enthusiasts of the latter variety, every way does not lead to the Way (to borrow from a Buddhist axiom). The way along a shoulder on a commercial vehicle access road is a far cry from the way along a scenic and remote county path through the Fall-yellow thick of an aspen grove and the scarlet symphony of a maple swarm. The way through the crush of an urban jungle does not allow for the same introspection that the way along a mountain ridge road of breathless horizons does…

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Pirates of the Mediterranean

IN the autumn of 68 B.C. the world’s only military superpower was dealt a profound psychological blow by a daring terrorist attack on its very heart. Rome’s port at Ostia was set on fire, the consular war fleet destroyed, and two prominent senators, together with their bodyguards and staff, kidnapped.

The incident, dramatic though it was, has not attracted much attention from modern historians. But history is mutable. An event that was merely a footnote five years ago has now, in our post-9/11 world, assumed a fresh and ominous significance. For in the panicky aftermath of the attack, the Roman people made decisions that set them on the path to the destruction of their Constitution, their democracy and their liberty. One cannot help wondering if history is repeating itself.

Consider the parallels. The perpetrators of this spectacular assault were not in the pay of any foreign power: no nation would have dared to attack Rome so provocatively. They were, rather, the disaffected of the earth: “The ruined men of all nations,” in the words of the great 19th-century German historian Theodor Mommsen, “a piratical state with a peculiar esprit de corps.”

Like Al Qaeda, these pirates were loosely organized, but able to spread a disproportionate amount of fear among citizens who had believed themselves immune from attack. To quote Mommsen again: “The Latin husbandman, the traveler on the Appian highway, the genteel bathing visitor at the terrestrial paradise of Baiae were no longer secure of their property or their life for a single moment.”
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Source: NY Times: Pirates of the Mediterranean

A very interesting read noting the parallels between Rome of the first century and the United States of today. Interesting, but I hope, ultimately wrong.

Wikipedia article on Lex Gabinia, the law passed giving General Pompey basically unlimited power to pursue pirates in the mediterranean.

Flushed – Major Newsweek Error

From Reuters (Via YahooNews): Newsweek says erred in Koran desecration report.

Newsweek magazine on Sunday said it erred in a May 9 report that said U.S. interrogators desecrated the Koran at Guantanamo Bay, and apologized to the victims of deadly Muslim protests sparked by the article. …

[Editor Mark] Whitaker said the magazine inaccurately reported that U.S. military investigators had confirmed that personnel at the detention facility in Cuba had flushed the Koran down the toilet.

The report sparked angry and violent protests across the Muslim world from Afghanistan, where 16 were killed and more than 100 injured, to Pakistan to Indonesia to Gaza.

To continue reading please go to Cox & Forkum: Flushed