Breakingviews

South Korea’s next leader will face a currency war

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Andy Mukherjee

Every new South Korean president has to contend with sabre-rattling by Pyongyang. It won’t be any different this time. North Korea’s recent rocket launch shows just what kind of reception the next occupant of Seoul’s Blue House can expect from across the demilitarized zone.

Merkel set for uncomfortable electoral victory

By Olaf Storbeck

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The parliamentary election Germany will hold next year will be both boring and exciting. Chances are high that Angela Merkel will win a third term. But voters won’t give her conservative CDU party a clear majority, and they still haven’t made up their mind about her coalition partner. The result’s implications for Germany’s stance in the euro crisis will be limited, no matter which party is in government.

India in depth: Consumption bets will outperform

By Andy Mukherjee

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The Indian economy has at least another year of poor-quality GDP growth ahead of it, even if the pace of expansion is somewhat faster than the 5.5 percent expected for 2012.

Congress should push for mandatory gun insurance

By Robert Cyran and Reynolds Holding

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

Congress should push for mandatory gun insurance. Firearm ownership is a U.S. constitutional right. But as last week’s massacre again demonstrated, it comes at a cost. Requiring liability coverage could be one way to keep the most dangerous weapons from unstable hands without infringing the law.

Central bank independence at risk in 2013

By Richard Beales

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The Federal Reserve will celebrate its centennial in 2013. Though independence for the U.S. lender of last resort and its peers elsewhere has historically come and gone, in recent decades it has become an article of faith. But these days, faith in central banking is far from rock solid.

Abe era will herald a three-digit yen

By Andy Mukherjee

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The Shinzo Abe era will herald a spectacular decline in the yen. The promise by Japan’s newly elected prime minister to end the country’s chronic deflation spells curtains for the half-hearted quantitative easing that has been the Bank of Japan’s hallmark for more than a decade. At some point in 2013, one U.S. dollar will buy 100 yen or more.

Review: Every monetary system needs a Paul Volcker

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

William Silber’s biography of Paul Volcker is rightly sympathetic to the man whose determination and integrity conquered U.S. inflation. When needed, he overcame opposition from politicians and academic economists. Yet once his work was done, policy slid back and his abilities were wasted.

Difference between “and” and “or” could undo Fed

By Martin Hutchinson and Richard Beales
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

The difference between “and” and “or” could undo the Federal Reserve. At its meeting Dec. 12 the Federal Open Market Committee replaced its estimated duration for low interest rates with thresholds for the unemployment rate and inflation. If reality makes the two measures diverge, the new approach could prove rocky for markets.

Qatar gives SocGen an honourable exit from Egypt

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Qatar has given Societe Generale an honorable exit from Egypt. State-backed Qatar National Bank will buy the French bank’s 77 percent stake in its Egyptian unit, National Societe Generale Bank (NSGB), through a mandatory tender offer valuing the whole at $2.6 billion. The valuation of 2 times book value is lower than pre-revolution multiples, and SocGen will have to carry some currency risk. But with few-sizeable buyers willing to live with Arab spring volatility, it makes sense for SocGen to shrink while it can.

Corporate carbon bubble may start to deflate

By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Next year could see markets start to wake up to a proper carbon bubble: the inflated value of hydrocarbon-heavy corporates.