Central Perk: 9 ian. 2016

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Mish's Global Economic Trend Analysis

Is Chancellor Merkel Openly Inviting More Sex Crimes by Refugees?

Posted: 09 Jan 2016 05:29 PM PST

Refugee Sex Scandal

In the wake of a New Year's Eve Sex Scandal in Cologne that involved approximately 1,000 refugees, German chancellor Angela Merkel proposed Tougher Migrant Laws.

Before: Asylum seekers are only forcibly sent back if they have been sentenced to at least three years' imprisonment, and providing their lives are not at risk in their countries of origin.

Proposed: Deport "serial offenders" convicted of lesser crimes.

What We Know

The Cologne incident involved at least 1,000 refugees of Arab or North African origin.
Women filed 379 criminal complaints of which 40% involve allegations of sexual offenses. Counts vary, story to story.
There were at least two reported rapes. Again, counts vary.
Cologne's police chief Wolfgang Albers, was suspended after repeated claims that his force mishandled the incident. Albers has since resigned.

Cover-Up

Not only did the Cologne police attempt to suppress the story, so did the media and Merkel's government.

The Telegraph reports 'Cover-Up' Over Cologne Sex Assaults Blamed on Migration Sensitivities

The Daily Caller reports Germany's Largest Broadcaster Apologizes For Not Reporting Sexual Assault Attacks

Germany's largest television station ZDF issued an apology Wednesday for not reporting on the New Year's Eve sexual assault scandal in the city of Cologne, where more than 100 women were victims of a "civil war like" situation.

Editors of the network's nightly news show "Heute" (translated to "Today" in English) confessed to not covering the attacks despite knowing the magnitude and severity of the events. Leaked police documents also confirm authorities held back on reporting information to the public until the media broke the story Monday — four days after the attacks.

Right to Asylum

"The right to asylum can be lost if someone is placed on probation or jailed," warned Merkel.

Excuse me for asking, but what "right of asylum" is there, if any, and what right should there be?

Deterrent or Invite?

"Serial offenders who consistently return to theft or time and again insult women must count on the force of the law," said chancellor Merkel.

Who is that supposed to scare?

If illegal refugees commit multiple crimes, are caught and convicted, they will be deported, assuming of course they show up for trial or can be rounded up.

Is that a deterrent or is it an open invite for more crimes in the face of absurd leniency?

Merkel ought to admit she is in this way over her head, that she was wrong to issue a blanket invite to refugees, that she has no idea how to deal with the crisis, and most importantly, that her ideas are out of sync with German voters.

Following those admissions, Merkel should do the honorable thing: resign.

Mike "Mish" Shedlock

Pro-Independence Spanish Parties Strike Deal to Form Government, New Catalan Election Called Off; Rajoy in Hot Seat

Posted: 09 Jan 2016 01:41 PM PST

Deal Announced

The Spanish political situation today is a lot different than a week ago. New elections were at hand in Catalonia if pro-independence parties could not resolve their differences.

Today, the bickering parties set aside those differences in a striking deal to form a new government, guaranteed to raise a strong reaction from Madrid.

To understand what led up to today's announcement, let's backtrack to fill in a few pieces.

On January 3, the Financial Times reported Leadership divisions deal a blow to Catalan hopes for independence.

The two main independence parties — the mainstream Junts pel Si movement and the anti-capitalist CUP — won a majority of seats in the Catalan parliament in a landmark regional election last September. Since then, however, the CUP has made it clear that it will not support Artur Mas, the current regional president and the de facto leader of Junts pel Si, for another term in office.

Mr Mas, a relatively late convert to Catalan independence, is seen by many CUP leaders and activists as too centrist and business-friendly. The Catalan president has also been damaged by a string of corruption scandals that hit his party over the past year.

The rejection of Mr Mas leaves the broader Catalan independence campaign in a difficult position — and with a clear sense of an opportunity wasted.

For the Spanish government, meanwhile, Sunday's decision will come as a relief. Madrid is fiercely opposed to Catalan independence, arguing that Spanish regions have no right of self-determination and that any step towards separation from Spain violates the constitution.

With the Catalan independence camp in disarray, Spain's mainstream parties can focus on resolving their own political dilemma: last month's general election produced a highly fragmented parliament, with no party close to holding a governing majority.

No Relief for Madrid

The sigh of relief in Madrid was short-lived. At the last minute, a deal has been announced that will make matters worse for Madrid than if CUP had gone along with Artur Mas as president.

The new president will likely take an even firmer stance on independence, not only from Spain, but the EU.

Expect a major reaction from Prime Minister Mariano Rajoy soon.

Pro-Independence Spanish Parties Strike Deal to Form Government

Please consider Pro-Independence Spanish Parties Strike Deal to Form Government.

The two pro-independence parties in the Spanish region of Catalonia have struck a last-minute deal to form a new government, after regional president Artur Mas agreed to step aside and let another politician lead the planned push towards secession.

Confirming his decision in a press conference on Saturday evening, Mr Mas said: "The most important principle is the country and its people. They stand above any party and above any person." Mr Mas and other independence leaders had until midnight on Sunday to either form a new regional government or resign themselves to an early election.

The decision is likely to have important repercussions both for the region and for Spain at large. The new Catalan government plans to steer the region towards a historic break with Spain over the next 18 months, by effectively setting up a state within the state — from a Catalan central bank to a separate tax authority.

Any such move is certain to invite a furious reaction from Madrid. In the short term, the Catalan accord is also likely to raise the pressure on Spanish political leaders from the centre-right to the centre-left to set aside their differences and form a strong unionist government. Party leaders in Madrid have been at loggerheads since Spain's inconclusive general election last month, which left even the strongest party — the ruling Popular party of Prime Minister Mariano Rajoy — far from a governing majority.

Mr Rajoy has repeatedly urged the centre-left Socialists to support him as part of a national unity government designed to fend off the Catalan challenge. That appeal is now certain to gain in urgency.

Saturday's deal marks a striking reversal for Mr Mas and his Junts pel Si movement, which had insisted until the last moment that it would not sacrifice the veteran leader. But with talks deadlocked, and a repeat election moving ever closer, Mr Mas finally agreed to make way for a party colleague, Carles Puigdemont, the mayor of Girona. The former journalist and editor is expected to be voted in as president of Catalonia in a special session of the regional parliament on Sunday.

The decision to swap out presidents followed months of talks between Junts pel Si, the more mainstream of the independence parties, and the Popular Unity Candidacy (CUP), a far-left secessionist group. Last September, the two parties won a majority of seats in the Catalan parliament, but then fell out over the issue of who should lead the next regional government.

Mr Mas's Junts pel Si party is by far the bigger of the two, holding 62 of the 135 seats in the Catalan parliament. But the CUP, a fiercely anti-capitalist party that rejects Catalan membership of both the EU and Nato, refused to back him.

National Election Implications

The December 20, Spanish national election left Spain in political shambles.

I wrote about the results in Spanish Election: Two-party Dominance Ends; Rojoy's PP Party Fails to Win Majority; Vote Buying Spanish Style; Fragile Coalition Possibilities.

Here were the results (revised slightly from my original post)

People's Party PP (Conservatives): 123 seats, 28% of vote
PSOE (Socialists): 90 seats, 22% of Vote
Podemos (Eurosceptic, Anti-Austerity Socialists): 69 seats, 20.5% of vote
Ciudadanos (Anti-corruption, nationalistic party): 40 seats, 14% of vote
Others: 28 Seats

Many expected PP and Ciudadanos would have enough seats form a majority. Ciudadanos had been polling above 20% with Podemos sinking.

Like PP, Ciudadanos is very much against the separatists in Catalonia, and very pro-euro.

But 123 + 40 does not reach the 176 needed for an outright majority.

Most of those "other" seats are for various separatist parties. So don't count on those votes.

The socialists and conservatives could form a government, but how stable would that be?

PSOE, Podemos, and Ciudadanos could in theory form a coalition but huge philosophical differences abound. Podemos is eurosceptic while Ciudadanos is very pro-Europe. In addition, Podemos is open to separatist elections and Ciudadanos would never go along.

Ciudadanos, an anti-corruption party can hardly strike a deal with the corrupt and ruling PP without losing face. And even if it did, the votes are not there. Podemos is in the same boat.

Prime minister Mariano Rajoy will likely appeal to all the other parties as a way to counteract the Catalan independence movement, but socialists and conservative don't mix well and the resultant government would be very weak.

Look for intense pressure from many quarters for a PP/PSOE alliance just to keep the separatists at bay.

New National Election Likely

The Catalonia regional election will stand. But new national elections still seem likely, with unknown consequences.

Mike "Mish" Shedlock

Seth's Blog : Getting ahead vs. doing well

Getting ahead vs. doing well

Two guys are running away from an angry grizzly when one stops to take off his hiking boots and switches to running shoes. "What are you doing," the other guy yells, "those aren't going to allow you to outrun the bear..." The other guy smiles and points out that he doesn't have to outrun the bear, just his friend.

I was at a fancy event the other day, and it was held in three different rooms. All of these fancy folks were there, in fancy outfits, etc. More than once, I heard people ask, "is this room the best room?" It wasn't enough that the event was fancy. It mattered that the room assigned was the fanciest one.

Class rank. The most expensive car. A 'better' neighborhood. A faster marathon. More online followers. A bigger pool...

One unspoken objection to raising the minimum wage is that people, other people, those people, will get paid a little more. Which might make getting ahead a little harder. When we raise the bottom, this thinking goes, it gets harder to move to the top.

After a company in Seattle famously raised its lowest wage tier to $70,000, two people (who got paid more than most of the other workers) quit, because they felt it wasn't fair that people who weren't as productive as they were were going to get a raise.

They quit a good job, a job they liked, because other people got a raise.

This is our culture of 'getting ahead' talking.

This is the thinking that, "First class isn't better because of the seats, it's better because it's not coach." (Several airlines have tried to launch all-first-class seating, and all of them have stumbled.)

There are two challenges here. The first is that in a connection economy, the idea that others need to be in coach for you to be in first doesn't scale very well. When we share an idea or an experience, we both have it, it doesn't diminish the value, it increases it.

And the second, in the words of moms everywhere: Life is more fun when you don't compare. It's possible to create dignity and be successful at the same time. (In fact, that might be the only way to be truly successful.)