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Monday, April 11, 2011

Ex-Federal Reserve chief Paul Volcker says breaking up Wall Street banks 'almost impossible'

Paul Volcker, the former head of the Federal Reserve and a driving force behind financial reform in the US, has said that the task of splitting up Wall Street banks now seems "almost impossible".

Ex-Federal Reserve chief Paul Volcker says breaking up Wall Street banks 'almost impossible'

Paul Volcker doubts banks can be made small enough to fail without impact on the financial system.

Richard Blackden

By Richard Blackden, US Business Editor 2:13PM BST 11 Apr 2011

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"I don't like these banks being as big as they are," Mr Volcker told a conference at Bretton Woods in New Hampshire on Sunday night. But "to break them up to the point where the remaining units would be small enough so you wouldn't worry about their failure seems almost impossible," he said.

The concern about the effectiveness of the reform of Wall Street since the crisis from Mr Volcker, who was chairman of the Fed for almost a decade from 1979 and, more recently, an adviser to President Barack Obama, comes as the Independent Banking Commission (ICB) today delivered its report on the future structure of British banks.

Regulators in the world's financial capitals are wrestling with how to make the financial system safer without prompting banks to leave for jurisdictions where regulation is lighter.

The former Fed chairman's concern over the failure to protect taxpayers and the wider economy from the potential failure of large banks was echoed by George Soros, the billionaire financier and philanthropist.

"I certainly consider they haven't addressed the problem correctly," Mr Soros said. "The whole issue of living wills and resolution authorities is not convincing."

While the UK government has until September to consider the recommendations from today's report from the ICB, US regulators have until July to turn last year's financial reform act known as Dodd-Frank into actual rules for the financial services industry.

Mr Soros said that authorities had not produced tough enough regulation to ensure that there won't be a need for governments to exercise the implicit guarantee that they would again bail out the financial system in a future crisis.

Mr Volcker and Mr Soros were among about 400 people who gathered over the weekend in Bretton Woods, where the monetary system that dominated in the 30 years after World War Two was created in July 1944, to discuss how economic thinking has and should respond to the most recent financial crisis.

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Telegraph.feedsportal.com

Sunday, April 10, 2011

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Saturday, April 9, 2011

View from the front of MNAC, Barcelona

Friday, April 8, 2011

Wisconsin high court election turned on its head

County Clerk Kathy Nickolaus speaks with reporters about Justice David Prosser gaining votes in Waukesha County. (Michael Sears, Milwaukee Journal Sentinel, MCT / April 7, 2011)

In a shocking twist, a clerk in a conservative Wisconsin county announced Thursday that she had discovered a net gain of 7,582 votes for an embattled conservative Supreme Court justice, a total that would make him the winner of an election in which his challenger declared victory Wednesday.

The election drew national attention because it was seen as a referendum on Republican Gov. Scott Walker's proposal to strip most public workers of their collective bargaining rights, which sparked huge protests and has been put on hold by a judge.

Unofficial tallies Wednesday had put Assistant Atty. Gen. JoAnne Kloppenburg 204 votes ahead of Justice David Prosser. But as county canvassing boards began double-checking totals Thursday, those margins shifted.

Then Waukesha County Clerk Kathy Nickolaus announced at a 5:45 p.m. news conference that she had left out the 14,315 votes cast in the city of Brookfield in the totals she released Tuesday night. Prosser won 10,859 votes there to Kloppenburg's 3,456. Coupled with small increases elsewhere in the county, Prosser gained a total of 7,582 votes on his challenger, giving him a 0.5% margin — enough to avoid a state-financed recount.

"This is human error, which I apologize for," said Nickolaus, a Republican.

Nickolaus has drawn controversy for keeping election data on private office computers that are not part of the county network. She said the error had nothing to do with that. The mistake was discovered during an open meeting of the county canvassing board, which was attended by at least one Democrat, Ramona kitzinger.

Kitzinger told reporters at the news conference that Nickolaus was telling the truth. "We went over everything and made sure that all the numbers jived up, and they did," Kitzinger said.

Other Democrats were skeptical of the announcement.

Rep. Peter Barca, the Assembly minority leader, in a statement noted that Nickolaus had worked for Republicans in the Legislature when Prosser was a leader there. "Her approach raises questions about the integrity of the election to the highest court in our state."

nicholas.riccardi@latimes.com

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Latimes.com

Vieux Lyon

Cross processed

Aid agencies brace for massive refugee flows from Ivory Coast

Aid agencies are preparing for an influx of a quarter of a million refugees fleeing across the border to escape the bloody violence unleashed by the struggle for power in Ivory Coast.

Aid agencies brace for massive refugee flows from Ivory Coast

People try to get into a bus in Abidjan. An estimated one million people have already fled their homes in Ivory Coast Photo: REUTERS

Aislinn Laing

By Aislinn Laing, Africa Correspondent 6:44PM BST 04 Apr 2011

The United Nations High Commission for Refugees said many people would walk for up to five days to cross the border, and predicted that the numbers could peak to 250,000 around June.

Oxfam has warned that many of the 100,000 people who have already crossed the country's western border into Liberia are living with scarce food and sanitation supplies in remote jungle areas which will be cut off when the rainy season starts.

An estimated one million people have already fled their homes in Ivory Coast to escape the fighting, which was prompted by disputed elections in November and has intensified in recent weeks as the forces of Alassane Ouattara, the internationally-recognised victor, took on those of Laurent Gbagbo, the incumbent.

Olivier Germain, an Oxfam representative based in Monrovia, the Liberian capital, said the numbers crossing the border had increased in recent days, and many were "very traumatised" after seeing their villages occupied by armed groups.

"There's a strong belief that a lot of people are still on their way or hiding in the forest over the border and haven't crossed yet," he said. "We have contingency planning for a much higher number - it's a very unpredictable situation."

Kristalina Georgieva, the European Union's head of aid, said she was "alarmed" by reports of manhunts and ethnic killings and appealed to both sides to act.

"History has given us far too many detailed examples of the scale of humanitarian disaster that results when violence is not stopped decisively," she said.
Telegraph.feedsportal.com

Thursday, April 7, 2011

Scottish universities face shortfall under Labour

Labour plans to provide only £38 million per year towards an estimated £202 million annual funding gap that must be filled if Scottish universities are to retain their international standing.

Iain Gray's Scottish Labour manifesto promises to provide only #38 million of the extra #202 million Scottish universities need

By Simon Johnson and Peter Hutchison 11:15AM BST 07 Apr 2011

Iain Gray, the party’s Holyrood leader, insisted the remainder of the money could be raised by charging foreign students higher fees, making increased ‘efficiency savings’ and gifts from rich Scots.

But a report compiled by an expert group for Scottish ministers suggested these elements would be nowhere near enough to fill the gap, prompting warnings that universities would have to cut courses and student numbers.

The plans was included in Labour’s Holyrood election manifesto, unveiled at Clydebank College, which made extra spending commitments totalling more than £815 million over the next four years.

Despite cuts to the Scottish block grant of about £2 billion over the same period, Mr Gray also promised his party would abolish youth unemployment in the next parliament.

The Labour leader said he plans to fund his spending spree by finding almost £5 billion of ‘efficiency’ savings in the public sector.

These include creating a single Scotland-wide police force and fire brigade and making the country’s 32 councils share services and backroom functions.

But opposition parties said the manifesto’s policies were based on extremely optimistic assumptions and university leaders dismissed the basis of the higher education funding pledge.

The launch of the manifesto, titled ‘Fighting for what really matters’, was delayed after a fire alarm was sounded in college, forcing dozens of attendees to evacuate and stand in heavy rain.

Unveiling the document following the delay, Mr Gray said: “This is a serious document for serious times and I’m a candidate for First Minister of my country because I think we need a serious government.”

He said youth unemployment would be abolished by guaranteeing school leavers an apprenticeship, setting up a new jobs fund and investing in industries like renewable energy.

Promising not to ask for a graduate contribution from Scottish students, Mr Gray added: “We will knock down barriers to access rather than build them up.”

But an appendix to the manifesto, detailing his spending plans, revealed that Labour has allocated only £38 million extra per year for higher education from the 2012/13 academic year.

An expert funding group has calculated an extra £491 million must be found between 2012 and 2015 if Scottish universities are not to fall behind their English competitors.

This includes £202 million in 2014/15 alone. Mr Gray’s spending plans leaves a cumulative £377 million shortfall over the three academic years.

A Labour spokesman chose to use slightly lower estimates, which do not include inflation, but insisted the shortfall could be largely filled by charging students from the EU and rest of the UK more.

This assumes the same number English students come north of the Border despite plans to more than treble their fees to £6,300.

Mr Gray wants to raise £22 million from EU students despite European law banning discrimination on the grounds of nationality.

His spokesman also confirmed Labour’s calculations include £26 million of efficiency savings. He claimed savings could also be found from a ‘root-and-branch’ review of higher education.

But Alastair Sim, director of Universities Scotland, called for “realism”, adding: “Efficiency savings are not a gap-closer because English universities are going after these savings too and charging students from the rest of the UK is not a magic bullet as increased fees will affect demand.

“We have just come out of one review process and are concerned that the potential timescales of a new review would mean Scottish universities start to fall behind those in England if the funding gap isn’t addressed immediately.”

He warned failing to close the gap would mean student numbers being cut and the quality of university education being affected. Mr Gray’s spokesman later insisted that any shortfall would be met from the public purse.

However, the manifesto appendix also shows no extra funding has been allocated for another keynote policy, to create a ‘national care service’ in the NHS. Mr Gray argued the costs can be met from existing budgets.

Similarly, Labour has allocated only £250,000 for a shared equity scheme to help first-time buyers, assuming instead that housing developers will bear all the costs.

Derek Brownlee, Scottish Tory finance spokesman, said: “It appears they did a bit of hasty adding up on Monday afternoon to give their manifesto some air of substance.

“It’s reliant on a series of optimistic assumptions without much evidence of serious consideration, particularly on university funding.”

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Telegraph.feedsportal.com