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from The Great Debate:

Putin’s Moscow is anxious, gilded and hollow

Putin chairs a meeting with members of the presidential council for civil society and human rights at the Kremlin in Moscow

The last time I saw Maria Baronova on Nikolskaya Street in Moscow, she was taking part in a silent anti-government demonstration before being bundled into a police bus with half a dozen other protesters. Now, almost three years later, we meet for a beer in an English pub on that same ancient street near the Kremlin. So much has changed: the Moscow protest movement has fizzled out after Vladimir Putin’s return to the presidency, activists like Baronova have been prosecuted, and a blanket of repression is muffling the last voices of dissent.

When I first met her in December 2011, I took an instant liking to Baronova because, unlike other protest leaders, she was unpretentious and smart, with a zany sense of humor. She embodied the contradictions of Russians who love their country, warts and all, and seek to reconcile it with the rest of the world. Today she sounds resigned, using the psychological term “learned helplessness” to describe Muscovites’ acceptance of the status quo – including, perhaps, her own.

Charges against Baronova for inciting a riot at a May 2012 rally were dropped in a pre-Olympic amnesty last December that also saw Mikhail Khodorkovsky and members of Pussy Riot walk free from prison. But while the former oil tycoon and the punk-rock performance artists tour the world as celebrities, Baronova can’t even get a European Union visa because her name appears in a Russian police database. She fought for “Western values,” Baronova said, and now the West is punishing her for it. Without any irony, Baronova, 30, posited that it may be better to accept Putin another 15 years than to squander the rest of her youth in the turmoil that would likely follow his departure.

Moscow is always a surprising kind of place. As a journalist who worked in the Russian capital for more than eight years, I expected Putin’s us-against-them nationalism to be more strident than ever. But flying in from Ukraine, which I have been covering for most of this year, I find the city uncharacteristically subdued and anxious about the future.

from MacroScope:

Putin – is he ready to deal?

Russian President Vladimir Putin and Ukrainian President Poroshenko are due to meet on the sidelines of the EU/Asia summit in Milan today to try to find a way out of the Ukraine crisis.

Germany’s Angela Merkel and French President Hollande will also meet the pair as part of a four-way contact group. The Kremlin has just said Putin and Merkel have "serious differences".

from MacroScope:

French figures under microscope

French Finance Minister Sapin adjusts his tie while seated at the start of debate on France's 2015 budget at the National Assembly in Paris

France will submit its 2015 budget to the European Commission today and, after a respectable period of consideration, it is likely to be thrown right back.

Paris has confirmed it will yet again miss the EU’s debt limits, failing to achieve a budget deficit of three percent of GDP until 2017 four years after it should have done.

from The Great Debate:

‘In Putin’s mind, Ukraine is not a nation’

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How dangerous is Vladimir Putin?

Reuters Editor-at-Large Sir Harold Evans moderated a panel of experts searching for answers to that question at a Newsmaker event hosted at the company's Times Square offices in New York on Oct. 14. The panel was comprised of New Yorker Editor David Remnick, author of the award winning Lenin's Tomb, former chess champion and Russian opposition leader Garry Kasparov, Russian-American journalist Masha Gessen and Roger Altman, who served in the Treasury Department under presidents Jimmy Carter and Bill Clinton, and is currently chairman of investment advisory firm Evercore.

The conversation ranged over topics including Putin's personal psychology, what threat Russia now poses to the world economy, and whether his regime might be toppled from within.

from MacroScope:

ECB in the dock

Protestors left some barbed wire in front of the euro sign landmark outside the headquarters of the ECB before its monthly news conference in Frankfurt

The European Court of Justice holds a first hearing on the legality of the European Central Bank's Outright Monetary Transactions programme. There won’t be anything definitive today but it serves to rekindle debate about the limits of the ECB’s powers.

In February, the German Constitutional Court asked the European Court to rule on the legality of OMT, the mechanism that drew a line under the euro zone crisis when it was unveiled in 2012. The court may give guidance about how best to make a final ruling which is expected in late spring next year.

from Anatole Kaletsky:

Will the European economy’s summer squalls turn into an autumn tempest?

Draghi, President of the European Central Bank (ECB) answers reporter's questions during his monthly news conference at the ECB headquarters in Frankfurt

Following the grim market response to European Central Bank President Mario Draghi’s latest monetary policy pronouncements, Europe is approaching another make-or-break moment comparable to the crisis of 2012. The summer quarter ended this week, and financial markets delivered their judgment on just how bad things are, pushing the euro down to its lowest level since September 2012. Europe’s quarterly stock market performance was the worst since the nadir of the euro crisis. The question is whether the miserable summer will give way to a milder autumn. Or whether the summer squalls will turn into a catastrophic tempest.

Given the absence of any decisive action at this week’s European Central Bank meeting, the answer will depend on three events in the month ahead: the Ukrainian elections on Oct. 26; the bank stress tests due to be finalized in late October by the central bank, and the judgment on French and Italian budget plans due to be delivered in outline by Europe’s political leaders at the Milan “growth summit” on Oct. 8 and then in detail by the European Commission at the end of the month.

from MacroScope:

After “get in the hole!”, Europe remains in a hole

Team Europe golfers pour champagne over captain Paul McGinley as they celebrate retaining the Ryder Cup at Gleneagles

Who says Europe is broken? The Ryder Cup stays here again and even Nigel Farage, leader of Britain’s anti-EU party, said he wanted Europe’s golfers to win.

The euro zone is not winning the economic competition however, despite the European Central Bank’s best efforts (it should be noted that only 3 of the 12 Ryder Cup team come from euro zone countries).

from The Great Debate:

Is there a new crack in the West’s sanctions regime against Russia?

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President Barack Obama’s speech at the United Nations Wednesday offered to roll back the U.S. sanctions if Russia takes the “path of diplomacy and peace.” This overture comes on the heels of an emerging ceasefire between Russia and Ukraine and continuing discussions in Minsk to find a political solution to the turmoil in eastern Ukraine.

Obama’s U.N. speech, however, opens up the possibility of creating some daylight between the United States and the EU sanction programs. The European Union remains openly divided over the current sanctions -- and far more economically bruised than the United States.

from MacroScope:

A long haul

U.S. Navy handout shows EA-6B Prowler attached to the Garudas of Electronic Attack Squadron 134 landing aboard the aircraft carrier USS George H.W. Bush after conducting strike missions against Islamic State targets, in the Gulf

Having largely sailed through this year’s choppy (to say the least) geopolitical waters, markets are a little discomfited by U.S. air strikes in Syria targeting Islamic State militants ... though only a little.

The U.S. military said Monday’s onslaught was just the start, suggesting it could take years to “degrade and destroy” the group, as Washington puts it. It remains to be seen how effective air attacks alone, which have been conducted in Iraq for some time already, will be in that regard.

from The Great Debate:

Why this Ukraine ceasefire will stick

[CROSSPOST blog: 2545 post: 1399]

Original Post Text:

A boy sits on an APC as he poses for a picture during a parade in Luhansk, eastern Ukraine

The war in eastern Ukraine, which has had more impact on the European economy than any news coming out of Frankfurt or Brussels, appears to be ending. Despite the sporadic attacks that have wrecked previous ceasefire attempts.

Investors have mostly assumed that the ceasefire would not hold, either because Russian President Vladimir Putin is deceitful and greedy for more territorial conquest, or because Ukraine’s President Petro Poroshenko would not accept the splintering of his country that Russia demands. But this fashionable pessimism is probably wrong.

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