A small report from Italy

I am currently in Ferrara, a small town less than two hours south of Venice. It is a beautiful town with well preserved historic center and bountiful agricultural produce. Winter has yet to leave so the grey skies dominate my stay here.

The local Benetton is having a closing sale. People are talking about yet another failure for the elected officials to form a government. I heard of young people still having hard time gaining full meaningful employment. I heard conversation today with an older person that this current young generation of Italian is having less than the previous generation.

There is a sense of dread among the young people that I met about their ability to work on their chosen careers. I heard a few cases of people working only half a year (during summer time) where there are influx of tourists enjoying what Italy has to offer.

It is a still wonderful country to visit. This is my first after my stay here twelve years ago, where Lira was still the currency of the country and Europe was still in an unheralded optimism of the upcoming single European currency.

But for many young people here, the country has become a trap, where staying in means being held back by the economic strain of the country.

Human Trafficking in Sinai

The Sinai Peninsula, which connects Egypt and Israel, has become a place of suffering and death for thousands of refugees from sub-Saharan Africa, from Eritrea, Somalia or Sudan. They come in search of a better life in Israel or Europe, but many of them end up kidnapped, imprisoned and tortured. Criminals among the Bedouins living here demand ransom from the victims' families back home. They often torture their prisoners to death. The government in Cairo, meanwhile, seems to ignore these brutal crimes.Spiegel

I wonder why the information about the futility of crossing to Israel via Sinai has not reached these countries. Egypt is incapable of controlling Sinai. This has been going on since the liberation of Sinai after the peace agreement with Israel in 1979.

The Cyprus Resolution

The heart of the agreement is this, deposits under 100,000 euros will be saved (this is the ceiling of Euro zone deposit insurance) and the second largest bank of Cyprus will be dissolved. Anything above 100,000 is   a fair game.

Much more importantly, the two main vectors of contagion — hitting insured deposits, and exiting the euro — have been avoided. And most elegantly of all, from the Troika’s point of view, the whole thing has been constructed under existing bank-resolution authorities, which means that no vote needs to be put to the Cypriot parliament, and therefore no amount of Russian pressure can veto the deal in Nicosia.

Of course, the game does not end here. It’s unlikely that Russia will appear bearing a better deal at some point in the next 24 hours, but the hit to Cyprus’s GDP is going to be so enormous that staying in the euro over the long term, absent another round or two of massive debt relief, is going to be extremely difficult. The deal as constructed is, in Pawelmorski’s wonderful phrase, “Iceland without the fish”: Cyprus, as Iceland did before it, is letting its banks fail, since they’re too big for the government to bail out. But Iceland has other industries besides banking — and, more importantly, has a floating currency as well, which by weakening can make those industries more competitive. Felix Salmon

Amazing pictures of Cairo and the Pyramids

More

Animals are smart

How do you give a chimp—or an elephant or an octopus or a horse—an IQ test? It may sound like the setup to a joke, but it is actually one of the thorniest questions facing science today. Over the past decade, researchers on animal cognition have come up with some ingenious solutions to the testing problem. Their findings have started to upend a view of humankind's unique place in the universe that dates back at least to ancient Greece.

A growing body of evidence shows, however, that we have grossly underestimated both the scope and the scale of animal intelligence. Can an octopus use tools? Do chimpanzees have a sense of fairness? Can birds guess what others know? Do rats feel empathy for their friends? Just a few decades ago we would have answered "no" to all such questions. Now we're not so sure. WSJ

Cyprus on the brink

Now they are proposing putting a 25% levy on deposits larger than 100,000 Euros.

Everybody is panicking and you are seeing these type of proposals being floated around. We shall see in 24 hours whether a deal can be reached. I am pessimistic.

Real time cyber attacks map

This website by T-Mobile presents some cyber attacks near real time.

The apology

Israel apologize to Turkey after the killing of its 9 citizens on the Gaza flotilla in 2010. Better late than never but man, it could have been done much earlier.

Obama traveled to Israel without any new proposals. Many scoffed at his trip, wondering whether it even made sense for him to go. But, in the end, he didn’t leave empty handed. President Obama and his team must have been pretty pleased with themselves when they traveled to Jordan Friday after scoring what CNN characterizes as a “diplomatic coup.” And it was a last minute coup. During a meeting with Obama at the airport, Prime Minister Benjamin Netanyahu placed a phone call to Turkish Prime Minister Recep Tayyip Erdogan and apologized for the killing of eight Turkish citizens and one American of dual nationality who were part of an aid flotilla to Gaza. Slate

Count your blessing

Be happy that you do not live in Cyprus right now. That country's future is fucked, regardless of the status of the bailout.

As you might have heard, they floated the idea of grabbing up to 10% of all depositors in Cyprus bank to raise money to bail out their banking system (as part of EU rescue package).

The plan was soundly rejected by Cyprus parliament soundly. It received no "yes" vote. But the damage has been done. They fact that they floated the idea in the first place has enough to scare the depositors in the country to prepare to pull out their money as soon as they can. At the moment all banks in Cyprus are closed.

So we are seeing an imminent bank run in Cyprus. People's trust of the banking system there has completely collapsed and the government might have to impose a draconian capital control to prevent people from getting their money out of the bank.

Remember, Cyprus has positioned itself as a European financial heaven where tax is low and deposit interest is high. They are a small island without much other potential source of income. Instead of turning themselves into professional paradise such as Singapore, they turned to the old trick of small islands - playing in the financial markets.

They had managed to attract large depositors from Russia. A few banks have manage to collect deposits to a sum larger than the country's GDP (not sure the exact figure). The problem is that the banks have decided to invest in risky investments that returns high yields (to pay for the high interest they give to their depositors) and dumb enough to hold Greece government bonds (remember, the riskier the bond, the higher the potential return). Off course Greece government bonds collapsed last year (or two) and the bondholder suffer massive  losses.

So right now they do not have yet a bail out either from European Union or the Russian to somehow save their financial system. And you can be sure that there will be a stampede of people pulling their money out in anyway they can.

So they are fucked now and they have no longer a future in the financial services sector. The good thing is they have plenty of oil drilling rights to sell.

Still, Cyprus is utterly fucked.

Update:
Now the European Central Bank just announced that it gives Cyprus until Monday next week to raise 6 billion dollars otherwise it will let Cyprus bank collapse. 

"in the Eurozone, deposit insurance is only as good as the ability of the sovereign to honour it." Coppola Comment

Yes, we are seeing something similar to what happened in Iceland four years ago. Iceland at the time decided to protect the domestic savers and screw the foreign depositors (they are being paid overtime partially). The difference is that Cyprus operates in Euro so it does not have the flexibility that Iceland has in dealing with the upcoming severe economic crisis. 

PKK leader announces cease fire

Kurdish separatists in Turkey are poised today to take the most critical step yet in efforts to end a 30-year conflict with the Turkish state when they call a ceasefire.

Abdullah Ocalan, the jailed leader of the Kurdistan Workers' party (PKK), is due to use the Kurdish new year's celebrations today to announce a truce, according to Kurdish politicians who recently visited the Turkish prison island of Imrali, where Ocalan has been held for the past 14 years.

"The statement I am preparing will be a historical call," Ocalan said. He also pleaded for the support of the Turkish government: "We want to rapidly solve the arms problem without losing time or another life." Guardian

PKK - Turkey conflict has lasted for 39 years so this cease fire announcement is indeed a great news. 

The Cyprus Fiasco

In the coming negotiations, the Euro Group must be careful as it seeks to maintain its credibility. The vote on Tuesday evening made one thing clear: The main concern in Nicosia was not in fact those who held smaller sums in Cypriot accounts. By Tuesday morning, the original deal had been changed to exempt from the bank levy those holding less than €20,000 in their savings accounts. That the parliamentary veto was nonetheless unanimous shows that lawmakers are primarily interested in maintaining Cyprus' role as a low-tax paradise and offshore business haven. It also shows that Cypriots are unwilling to be bullied from abroad, particularly not by the Germans.

The facts of the case would seem to belie the intense emotions it has triggered. Two large Cypriot banks have run into difficulties and Nicosia is unwilling to liquidate them or allow them to enter into insolvency because that could fatally harm other banks in the country and destroy the country's reputation as a financial center for the foreseeable future. But bailing the banks out is beyond the means of the government, which is why Cyprus needs billions in aid money from the European Stability Mechanism (ESM), the euro-zone's permanent bailout fund. The euro-zone, led by Germany, came up with a not unreasonable demand in exchange for assistance: Namely that the bank customers, whose accounts are to be saved, contribute to the bailout. Spiegel

Pope Francis Inauguration Homily

It comes with translation.

Cards Against Humanity

http://cardsagainsthumanity.com/

Has anyone played this card game yet?

How to make McD style burgers at home

This is a McDonald instruction to create burger based on their old recipes.

Bring the pitchfork out

People in Cyprus must have infinite patients  that they have yet to go down the street and burn all the government and bank offices for the proposed up to 10 percent levy on deposits.

This article highlights the key moments in this financial debacles.

Two of Cyprus major banks, Bank of Cyprus and Popular Bank, were crushed by Greece's sovereign bond write down.

he’ll be less Ratzinger and more Dalai Lama

The title comes from a quoted observation from this Time article. This seems true to me. After the passing of Pope John Paul II, the gold standard for religious head communication skill and charisma is the Dalai Lama.

People might not agree with the austere concept Buddhism and its related rituals, however Dalai Lama's emphasize of compassion, compassion, compassion really bring people in to the message of Buddhism. The way he crack jokes and his insistence that he is just a simple monk endears him to people.

 "This is what I want, a poor church for the poor."

Pope Francis' prioritizing the church message to take care of the poor is well received. People will still disagree with other church messages in contraception and gay, etc but his style of communicating and his emphasize on the issue of poverty will resonate with many people.

It is a good start.

Pope Francis

The New Yorker

It will take a few days more before we are getting in depth articles regarding the new pope. I think his election was a surprise.

One thing though, this new Pope has more public charisma than the previous one. If he can communicate as well as John Paul II and bring more order the church, then he would be remembered as a great Pope. 

Chicken Processing

Welcome to the reality of mass food productions.

Guardian's reporting on Allepo's massacre

The graveyard Rezk spoke about was a children’s playground. All semblance of fun in this muddy stretch of rusting green swings and slides had long ago been surrendered to the grim reality of dealing with death in a city that no longer functions. Only a corner of the playground — for now — has been commandeered by grave diggers, men who swing shovels over their naked torsoes in the bitter cold and a small digger that scrapes at the soil, ever so gently for such a strong machine. Guardian

LucalFilm stores 17,000 Star Wars characters

As it turned out, Lucas had already done the cataloging. His company maintained a database called the Holocron, named after a crystal cube powered by the Force. The real-world Holocron lists 17,000 characters in the Star Wars universe inhabiting several thousand planets over a span of more than 20,000 years. Business Week

That is amazing. Remember these are all invented characters.  

convenience and suicide

Psychiatrists first started focusing on how much the ready availability of lethal means affected suicide rates after a fortuitous experiment in England. When the country switched its heating from coal to natural gas in the 1970s, suicide rates plummeted, because the fumes were not as deadly; gas has a far lower carbon monoxide content. Sri Lanka developed the highest suicide rate in the world in the 1980s, following the introduction of pesticides on a mass scale. Once the government removed the most toxic compounds, like Paraquat (lethal in 70 percent of cases) suicide rates dropped 50 percent, though the number of attempts dropped by less.

Studies show that once a convenient lethal method is removed, many do not seek other options. “If people go to the Golden Gate Bridge and encounter a barrier, they don’t go to the Bay Bridge and try there,” Dr. Reidenberg said.

(NYTimes)

Egypt is bracing for tomorrow's verdict

The verdict against some police and officials regarding last year's Port Said football stadium massacre will be announced tomorrow. We are bracing ourselves on further clashes in Cairo and other places regardless of the results.

The police and Central Security Forces are also on strike.

The bottom line for Israel and Palestine

Remember, the occupation itself was originally justifiable: Jordanian forces fired on Israel from the West Bank, and Israel subsequently took the territory from which it was being assaulted. It was when some Israelis succumbed to messianic temptation and moved to the West Bank, with the help of successive Israeli governments, that the true problem began.

Israel faces only two choices here: It can offer citizenship to the Palestinians whose lives are affected by its decisions, or it can negotiate an end to settlement, especially the far-flung settlements that project deeply into the West Bank, and then work toward the creation of a Palestinian state. Will Jews be allowed to live and pray in that Palestinian state? I certainly hope so; it would be a crime to deny Jews access to their holy sites. Hebron is Judaism's 2nd-holiest city, Jews lived there for millenia until they were massacred by some of their Arab neighbors (other Arabs played a role in the rescue of the remnant of the Jewish community) and Jews quite obviously have a right to live in all parts of their historic homeland.

That said, the Jewish state cannot maintain a double-standard in these areas, because it is also a crime to deny people full enfranchisement based on their ethnicity. Most Israelis want to maintain their country as a Jewish state, and as a Jewish haven. Jews, because they are an ancient people, and because they have suffered at the hands of Christians and Muslims for centuries, have earned the right to independence. Having finally earned the privilege of Jewish autonomy, Israelis do not want to become citizens of the world's 23rd Arab-majority state. But eventually, if the Palestinians of the West Bank aren't freed from Israeli domination, that is what they will become. Jeffrey Goldberg

Palestine - Israel issue will be solved one way or another. This conflict has gone way too fucking long and wasted so much time, money and lives. 

The invasion of Malaysia escalates

This area is about 6 hours by speed boat from my Borneo island. For the past couple of days they have been  invaded by armed insurgents from Philippines who take claim of ownership for the state of Sabah. They declared themselves as part of the Sultanate of Sulu, a kingdom that no longer exist.

The Malaysian and Philippines governments have been trying to resolve the situation peacefully but the situation have deteriorated quickly as ensuing violent confrontations resulted in losses in Malaysian armed forces and the insurgents.

The best way to follow this rapidly moving news is by reading the Wikipedia entry on the standoff.

This is not Allepo

This is Port Said, Egypt last night. It's fucking surreal to hear AK-47 bursts in Egypt.

The Berlin Scandal

This is one of the more embarrassing failure for German local government to handle large public infrastructure work

There is, however, at least one place in Germany where brightness is the rule rather than the exception. At the problem-plagued construction site that will eventually become the Berlin International Airport, the terminal lights burn around the clock. And the reason is not to prevent workers there from succumbing to the winter blues. Rather, technical difficulties at the ultra-modern airport -- which will ultimately cost close to €4.3 billion -- mean that the lights can't be switched off. Spiegel

The airport was supposed to be operational in 2011. Two years later it is still in fixing mode and there is no light at the end of the tunnel. They have spent 4.3 billion Euros so far on the airport.

If the Germans can't do public infrastructure right, there is no hope for the rest of us. 

Global warming

Last Friday's Federal Register:

The Draft Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2011 is available for public review. Annual U.S. emissions for the period of time from 1990 through 2011 are summarized and presented by source category and sector. The inventory contains estimates of carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), and sulfur hexafluoride (SF6) emissions. The inventory also includes estimates of carbon fluxes in U.S. agricultural and
forest lands. The technical approach used in this report to estimate emissions and sinks for greenhouse gases is consistent with the methodologies recommended by the intergovernmental Panel on Climate Change (IPCC), and reported in a format consistent with the United Nations Framework Convention on Climate Change (UNFCCC) reporting
guidelines.

The US EPA has begun to require permits for emissions of greenhouse gases, and has started to force restrictions on carbon emissions from new automobiles. Starting last year, power plants, cement kilns and refineries which release high amounts of carbon dioxide and other greenhouse gases have to obtain permits. More sources will gradually be subject to the regulations.