The Gold Standard | Great readings

Sourced from many other blogs. Difficult to remember and acknowledge them individually when one reads many of them on the train-ride to work:

There’s a real reluctance to crystallise losses (Emphasis mine and that is a behavioural issue too for institution and individual investors) as many of the banks just don’t want to take a hit. As the situation in Greece deteriorated, many banks just held on, hoping they could sell off their exposures at a later date,” said Roberto Henriques, head of financial institutions credit research at JP Morgan. [Full article here]

Thanks to a friend, read this sensible piece on the US budget deficit reduction efforts by Tom Coburn, a Republican senator:

What is really happening behind closed doors in Washington would both sicken and inspire the American people. Some in both parties continue to play political games. Yet, many elected officials on both sides are willing to make hard choices. More than 40 senators have come together to discuss the crisis; dozens have privately expressed their willingness to take bipartisan action. But, right now, the possibility of a win-win agreement for America is being turned into a lose-lose stalemate because too many self-serving politicians, special-interest groups and political consultants in Washington are invested in the status quo. [More here]

Clive Crook in the FT cites Tom Coburn:

“I would downgrade us in a minute. I would, knowing what I know.” [More here]

I wonder which view is more current – his Op-Ed. or this one or can both co-exist?

Easwar Prasad’s piece – on the selection of the new IMF Chief – is feisty, bold and recognises realpolitik. The most disappointing thing for me is not that Europe has ditched its promise but this FT European editor Wolfgang Muenchau was quick off the blocks to write a Op-Ed making the case for European to succeed another European – last Monday itself. That was disgusting and disappointing to me.

Easwar Prasad’s piece is the best of the lot. There are many among my friends who argue that India should identify itself closely with US interests and seek opportunities to do so. Yours Truly has been and remains a sceptic of that. The big powers – China and the US and the marginal one Europe – bat for their interests. We should do so too. There are no other overarching principles. US’ and China’s actions, inimical to India, differ only in degrees. Yes, I am aware of 1962, stapled visas, nuclear deal vote and much else. To all of you who throw these at me, the only answer I have is that you should go read, ‘Deception’ by Adrian Levy and Catherine Scott-Clark.

What does it have to do with the current issue? Emerging markets should coalesce around one candidate and Indians should not balk at supporting a Chinese or a Singapore candidate if a consensus emerges around them while, at the same time, striking bargains behind the scenes on issues of importance to India, behind the scenes. The monopoly of the West on institutions of power and thought has to be broken first. Developing nations can fight for their spoils later.

However, if it is clearly agreed that the candidature of Christine Lagarde is only for the unfinished term of the Presidency of Dominique Strauss-Kahn, that might be acceptable.

Jean Pierre-Lehmann’s letter is delightful.

DISCLAIMER: This is an archived post from the Indian National Interest blogroll. Views expressed are those of the blogger's and do not represent The Takshashila Institution’s view.