Okay, someweird stuff has come out of Russia. Weird stuff comes out of everywhere, no biggy.
But this is… really weird.
If any Russian readers can give some context to this, I’d be fascinated.
Breaking news in the last hour is that Radovan Karadzic has been arrested in Belgrade. Karadzic, you may recall, was the President of the Bosnian Serb Republic. He’s under indictment for about twenty different war crimes, and has been on the run since 1996.
Few details are available yet. The arrest was made in Belgrade earlier today. It’s not clear by whom. (The Serbian Ministry of the Interior, which controls the police, issued a brief statement saying it was not involved.) The Serbian government formally notified the Hague Tribunal this afternoon.
As always in these matters, there’s some mystery and confusion. Just last week, officials in both Serbia and the Republika Srpska had announced that they didn’t believe Karadzic was in their countries. This was actually plausible! The new Serbian government had just arrested another war criminal in Belgrade a few weeks ago. So you’d think Karadzic would have stayed well clear.
Was he simply stupid? Or was he lured back to Belgrade somehow? Or was he there all along? If the latter, then former Prime Minister Kostunica surely knew about it… and was lying his ass off to the Hague and the world for five years straight. I’m no fan of Kostunica, but I’d hate to think that.
On a personal note: for years my wife has said that Karadzic was living “down the street” from us back in the early 2000s. At that time, we were living in the street Golsfortieva (that’s Serbian for “Galsworthy”) in the neighborhood of Vracar in central Belgrade. She picked this up from talking with the neighbors, and for five years it’s been a running joke in our house. “Right down the street from us!” “Right, sure, yes, dear. Whatever, okay.”
Well, at least one source is claiming that the arrest was made in… the neighborhood of Vracar, in central Belgrade. Headline: Blogger’s Wife ‘Very Satisfied’ By Arrest.
Anyway. A day or two may pass without much news, as under Serbian law the accused has the right to challenge certain aspects of his arrest — most notably, whether or not he’s really the person in question.
Still: great news, if true.
How about that. Surprising the new government would go so far.
Well some times I agree with Wolfgang Munchau, and sometimes I don’t. This is one of the occasions when I do, especially the following passage which can be found in his Financial Times op-ed this morning:
“Some degree of competitive adjustment is probably needed but the huge scale of the shock that is unfolding in Spain will almost certainly require a macroeconomic response that Spain cannot deliver on its own……….So what actions would be needed? In the very short run, a transfer mechanism to provide help for countries in severe distress. Of course, any transfers would have to come with IMF-style conditions attached.”
Basically this is broadly in line with what I was suggesting in my RGE Europe EconMonitor piece – What Is The Risk Of A Serious Melt-Down In The Spanish Economy? – last Friday. Essentially the ECB has now gone about as far as it can, and the EU Commission in some yet to be determined way needs to play the role of the US Treasury (we lack the appropriate architecture at this point, but still), and inject cash – rather a lot of it. This is an EU problem and not simply a Spanish one since the source of the bubble lies very clearly in earlier monetary policy over at the ECB (or in deficiencies in the way in which the “one size fits all policy has been administered, see in particular “How to prick local housing bubbles in a monetary union: regulation and countercyclical taxes” by Alan Ahearne , Juan Delgado and Jakob von WeizsÃ¤cker – also on RGE last Friday).
It appears the Spanish cabinet is now divided between one group – lead by Industry Minister Miguel Sebastian – who favours intervention to rescue ailing builders – and another – lead by Economy Minister Pedro Solbes – who do not favour intervention.
My view is that a substantial, but as of yet indeterminate quantity of money (possibly in the region of 300 – 500 billion euros) needs to be injected urgently into the Spanish banking system, either directly (by buying cedulas hipotecarias outright) or indirectly by buying up and closing down builders as part of a “restructuring programme”, and this needs to be done by the EU equivalent of the US Treasury (whatever we decide that that actually is) and not by the ECB. Thus I am neither with Sebastian (who would, I suspect like to save the builders) or with Solbes. Of course, as Munchau indicates, any such intervention would need to come with all manner of conditions attached (a restructuring of the whole Spanish mortgage situation, to put the banks back on a sound footing, being just one of these), and this would mean that the Spanish government would to some considerable extent lose control of its own internal affairs. But this possibility was already implicit in the creation of the eurozone in the first place, so I suppose you could say that one day or another this situation had to arise. And now it has. So let’s get on with things and take some decisions.
You can find the relevant part of Munchau’s editorial below the fold. Continue reading
(This story is a week old. Somehow, inexcusably, I missed it until now.)
Anyway: the Miss Universe pageant was held last weekend. It was in Vietnam this time, and a nice young lady from Venezuela won, but what’s interesting to your hardcore Balkanologist is that
1) the pageant accepted Kosovo as a country, and
2) Miss Kosovo made it into the top ten. (To be precise, she placed sixth in swimsuit and eighth in evening gown.)
Putting aside (1) for the moment, (2) is a pretty huge deal. The Top Ten are always dominated by big countries, and this year is no exception: the USA, Russia, Italy, Australia, Mexico, Spain. It’s very rare for a Balkan country to get in. For a girl from Kosovo to come this far… well. Continue reading
“Look, Doctor, he’s just faking……. Even now in the hour of his death he has to trick us.”
The opening sentence: â€˜There’s a long silence, and then I say â€¦â€™ indicates the three functions of this book. It is an attempt to find a self through utterance, after a lifetime of non-communication; this was prompted by the wish to break a writer’s block and involves a search for a discursive mode in the psychoanalytic situation, the so-called â€˜talking cureâ€™ in which one participant often remains silent.
Upon reading Carlos Fuentesâ€™s novel La muerte de Artemio Cruz (1962) for the first time, many readers find themselves confused, frustrated, and even lost, due to its complex narrative structure.
‘As far as I am concerned, this is … the most complex crisis we’ve ever seen due to the number of factors in play’
Spanish Economy Minister Pedro Solbes speaking last week to Spanish radio station Punto Radio
OK, You won’t find serious analysis of Spain’s immediate economic plight here. If you want that you can go over to my two most recent posts on the topic at Roubini Global’s European EconMonitor (What Is The Risk Of A Serious Melt-Down In The Spanish Economy?, and
Has Spain Contracted The Artemio Cruz Syndrome?), or if you are really interested you can follow the crisis evolve day by day on my Spain economy blog.
Quod erat demonstrandum as far as I’m concerned on that account (and if you don’t agree with me please feel free to go over and post whatever comment you like). No, here I am speaking to those people – and especially Spanish people and other South Europeans who may understand all this much more than North European will do – who recognise that there is a problem, and a big one down here in the eurozone’s fourth economy (who the hell just blew that hole in the side of the ship!), and who are trying like I am to understand how we got here, and how we seem to be so incapable of reacting and rising to the challenge of the moment.
Now If this seems like a rant, I assure you it really isn’t meant to be one. It is simply an expression of frustration at the kind of blind trust in fate that seems to grip all of those I see around me at the moment (“they must know really what is going on, mustn’t they”). As an Italian reader to my Italy blog said after another rant-type comment, “I love Italy, I really do. If I didn’t, I would not waste my time on this.” Well, I am Catalan. I couldn’t exactly say – keeping a straight face – that I *love* Spain, but what happens to Spain does matter to me, and as my Italian commenter friend said, I wouldn’t be writing all this if it didn’t.
The Death of Artemio Cruz is an everyday story of love and lust in Mexico, a tale, as they would say down in that part of the world of “chingones y chingados “. Now it is widely accepted among critics of the Fuentes’ novel that our hero Artemio serves as the personification of a whole country, and what I wish to do in my “reincarnation” of the character of Artemio Cruz in the form of Jose Luis Rodriguez Zapatero – the president locked “a cal y canto” behind the tightly closed doors of his Montcloa palace (blindado contra la realidad would be the expression that came to mind, rather like Aznar cruising round in his limousine, obsessed by ETA while quietly neglecting the real and present threat of Islamic Fundamentalist Terrorism) – is raise the issue about what it is exactly in Spanish culture which leads to flight and denial as the first reaction to any impending unpleasant event. I mean it wasn’t as if this was the first time. There is no need to mention I think what happened after 11 March and then there was that nasty little incident of the Prestige Oil Tanker – during which the tanker was quietly towed out to sea in the vain hope it would reach Portuguese waters before the problem became too evident – oil sir, I see no oil. What was it we said then? Oh yes, nunca mÃ¡is!
Well the problem seems to be a perennial one, and it’s high time it was addressed.
The Death of Artemio Cruz is a novel where the broad sweep of 20th century Mexican history is viewed through the prism of one man’s life. Cruz starts out as an idealistic young soldier fighting in a Mexican Revolution which is dedicated to the redistribution of land and an attempt to give the peasants a decent life. By 1919, the successful revolution has deteriorated into a series of confusing and bloody skirmishes between rival rebel factions that never truly end until 1942. There, but for the grace of god, go all of us.
I learnt in sociology class that the south of Europe is a collective society and the north individualistic, but I think it’s the opposite!
Young Portuguese economist friend of mine who currently works in London
“The truly annoying Italian habit of only taking care of one’s own clan will deter any meaningful resistance to a country downsize.”
Italian Commenter on my blog
Now the start of the novel finds an elderly Artemio lying awake on his deathbed, gripped by repeated spasms of excruciating pain, and terrified to open his eyes for fear of what it is he might get to see if he does. After years of debauchery and loose living (shade’s of Oscar Wilde’s Dorian Gray here) the thing which seems to frighten him the most is the possibility he might get to take a look at himself in a mirror. Of course, there are comparisons and comparisons here. Spain’s economy is far from moribund, nor is it in its death throes. But Spaniards are suffering, and the process of adjustment is painful, and if something isn’t done soon the problem might well get a hell of a lot worse.
Yet the attitude of the country’s leader – JosÃ© Luis Rodriguez Zapatero – does somewhat resemble that of Artemio Cruz in that he appears, at least from the outside, to be totally obsessed with looking at anything that isn’t an valid reflection of the actual state of the Spanish economy. Worse, he seems to be drifting off into a kind of of paranoia where any attempt to draw to his attention that matters could turn critical is seen as an attack on him personally, and on the record of his government. Now while mistakes have undoubtedly been made, I think it would be hard for anyone to suggest that Zapatero is responsible for what is happening. He is however reponsible for not responding adequately, and for not accepting clearly in front of the Spanish people the seriousness of what we are faced with (are there shades of BarÃ§a’s own Joan Laporta here? I mean would Laporta be another case the Artemio Cruz phenomenon, with the two President’s locked away in their boardrooms, surrounding themselves with an ever diminishing circle of “faithful”). Certainly if the rumours are true, and Pedro Solbes did finally put his foot down last week by refusing the idea of an ICO loan to rescue Fernando Martin, the circle is getting smaller by the day.
Of course it’s easy to criticise here, since the problems Zapatero is reluctant to look too closely at are serious ones, and worse still, it isn’t at all clear that anyone really knows what to do about them at this point. But why the hell doesn’t the man come out of what looks to everyone else to be a “dream”?
Will The Last One To Close Please Turn Out The Lights, I Can’t Find The Switch
Meanwhile we learn from Jose Luis Malo de Molina, director general at the Bank of Spain (speaking at a recent conference in Valencia) that the number of new homes which will be completed in Spain in 2008 will beat all previous records (I said this was a system which was slow to react), simply piling one more house after another in order to add to that glut of newly completed homes that is already idly languishing and casting its long shadow over the Spanish property market. MuÃ±oz’s explanation for this phenomenon is simply that â€œthe real estate sector canâ€™t turn around quickly, it works in the medium and long term, so this year the properties started at the end of 2005 and beginning of 2006 will be completed, which means the number of new properties on the market will hit an all time high.â€ As I say, “just in time” may be an idea that has entered the heads of the more agile companies like the textile consortium Inditex, but most of Spain is a very, very long way from being able to offer an agile response. On the anecdotal front, a friend of mine recently went to visit family homes in the North West of Spain. In Vigo he spoke to the owner of a brick factory, and in Leon someone who had a quarry. In both cases production was continuing (there is simply no on/off switch here) but the inventory already had piled up to the extent of being now prepared to satisfy normal requirements for the whole of 2009 (in both cases), and of course, in 2009 requirements will not be normal, since housing starts in 2008 have collapsed to a forecast of below 200,000 (down from 600,000 plus in 2007).
Chingue a su madre
Hijo de la chingada
Aqui estamos los meros chingones
DÃ©jate de chingaderas…
Fuentes devotes two entire pages of his novel to such phrases, all of them derivatives of chingar – the word that – according to Octavio Paz in El laberinto de la soledad – best defines all Mexicans. I will not descend here to making my own listing of the various Spanish derivations of “joder” (nor even make the most obvious allusion to that ubiquitous warcry of the Cacique, que se……), but the similarity is indeed striking, even if the modern Spaniard treats his status of “jodido” in a rather more self-mocking and ironic fashion than the Mexican does – as best depicted recently by the dignified rout of the Spanish Tercio rabble at the hands of those ever so elegant French Hussars in the wonderful closing scene of DÃaz Yanes’s Alatriste.
But my answer is NO! We are not jodidos. Although if we are to get out of the hole we have all dug for ourselves, we will have to bury Artemio Cruz (and not that proverbial sardine) once and for all, and adopt a new spirit. Maybe it would not be too appropriate at this point to invoke the memory of Hernan CortÃ©s (as a friend of mine once said, the mystery isn’t how he managed to conquer Latin America, but how he managed to find his way from Badazoj to the sea), but Spain’s immediate future certainly lies out there somewhere across the Atlantic and over towards Latin America, or in the up and coming Euromed (aka the Barcelona process), or in the Philippines – all areas these where Spain has strong historic and cultural ties, ties which must now be leveraged in these rapidly growing countries as we need to live from exports.
On the operating table, the surgeons open Artemio Cruz up only to find that his disease is too advanced for them to help. He has gangrene and a perforation, eaten away from the inside. He dies on the operating table.
So I will close this post as I commenced it, with yet another reference to the magical world of Latin American literature. This time my reference will be to Jose Luis Borges, who – in a rather original and creative allusion to what is known as the prisoners dilemma – tells us the story of two villainous rascals, eternal rivals, who – under sentence of death – are offered one last wager: rather than forlornly accepting their fate (cap cot) and acceding to a conventional execution they can go gloriously, by agreeing to have their throats slit, not one by one but simultaneously, just to see who is able to run the farthest after the first cut. Immortality, rather than fame, in an instant.
Now I mention this rather gory since tale I can readily anticipate the feelings many will have on reading my proposals to cauterize the immediate wound and stop the now impending haemorage of blood – I am at the end of the day arguing that it is necessary to inject money – and I do mean rather a lot of money – into a banking and construction system which many will want to argue is largely responsible for Spain’s present distress (you know, the chingones and the chingados). Indeed, having made a good deal of money out of the operation, many will feel that these are the very people who should now be forced to don that sackcloth and ashes costume which so behoves them (actually the way things stand they are much more likely to find themselves reduced to a sporting a loincloth, but still). I understand why many ordinary Spanish people may have such feeling, but I do think this is a time for cool heads, and that what is most needed here is an extreme dose of pragmatism coupled with a lot of emotional intelligence. There is no point in agreeing to have your own throat slit just to see people you don’t like have their’s slit first.
Nicolas Sarkozy is going to Dublin for a few hours on Monday.Â Â Going by the Elysee website, his agenda for Barack Obama’s visit on Wednesday is far clearer than for his visit to Ireland.Â Â On what is ostensibly a listening tour to understand the reasons for Ireland’s rejection of the Lisbon treaty, the signals are already strong that he is there to urge a second referendum on the Treaty if Ireland wants to continue participate as an equal with the 26 other EU member states.Â But the timing of the revote is tricky.Â Here is the key answer given by him to the Irish Times (responses to written submitted questions) —
Via the invaluable Osservatorio sui Balcani comes a fascinating report on crime in the Balkans. It’s by the United Nations Office on Drugs and Crime (ONODC), and it offers some surprising conclusions:
[The] Balkans is safer than thought…
With detailed, comprehensive statistics, the report concludes that the Balkans, contrary to widespread opinion, does not have a problem with conventional crime: â€œSouth East Europe does not, in fact, suffer from high rates of crime, at least in terms of the range of offences commonly referred to as â€˜conventional crimeâ€™: murder, rape, assault, robbery, burglary, theft and the like. In fact, most of the region is safer than West Europe in this respect.â€ The report notes, â€œThis key fact is often omitted from discussions on crime in the region.â€
The Prime Minister of Belgium has offered to resign, setting up an unwanted rematch with Serbia to see which European parliamentary republic can go the longest without a national government. Serbia’s recent entry in the contest is a mere 57 days. The BBC says that the last round took nine months to give birth to a government, but as Ingrid Robeyns notes, the deal was hatched in December after merely 192 days. That will be a tough mark to beat, and serves as a reminder to mere potential candidates what a full EU member is capable of.
Back in January, I posted about how Macedonia’s young Prime Minister, Nikola Gruevski, was for some reason the most popular head of government in the Balkans.
Well, they had Parliamentary elections at the beginning of June, and Macedonia said: yes. Gruevski’s center-right coalition won a whopping 63 out of 120 seats, giving them an outright majority. That’s very rare in this part of the world, and it’s the first time it’s ever happened in Macedonia.
Unfortunately for Gruevski, the elections did not go smoothly. There was violence at or around the polls in several ethnic-Albanian regions of the country. Continue reading