Comment, analysis and other offerings from Tuesday’s FT,
Gideon Rachman: Egypt’s liberals are losing the battle
All sorts of contending forces rub shoulders in Egypt these days, says the FT’s Rachman. Last week, I found myself in the lobby of a Cairo hotel, chatting to a square-bearded, pot-bellied, fundamentalist preacher who is eager to see all women in Egypt wear the niqab – the all-encompassing veil that leaves only a slit for the eyes. Just behind him, French tourists ambled around in bathing suits. Then the hotel crooner began belting out “My Way”. I suggested we move to a quieter spot and the preacher agreed, pointing out that, as a Salafi, he objected to all forms of music – and not just Frank Sinatra.
Lex on Barrick
Barrick Gold starts out its statement about the proposed acquisition of Equinox Minerals with the customary blather about the target’s quality, the fact that the deal fits its strategy and how it will be accretive to earnings per share. Once that is out of the way though, chief executive Aaron Regent says something unique: the deal “does not dilute our shareholders’ gold exposure per share”.
Steven Rattner: Only tax rises can fix America’s budget mess
Never particularly grounded in reality, budget talk in Washington has taken on an Alice in Wonderland quality, writes Rattner, who has served as lead auto adviser to the US Treasury secretary. A paroxysm of deficit cutting is sweeping the US, with Republicans and Democrats hurling around dubious figures like confetti. But both are trying to win the battle to be the party of fiscal responsibility without broaching the one step every sensible analyst knows is necessary to solve America’s budget crisis: meaningful tax increases.
Yukon Huang: Expand cities to stop dissent
Civil unrest in China is on the rise. Purely political revolts, similar to those in the Middle East, are rare – even though, by launching a crackdown on dissidents, including the artist Ai Weiwei, the state is not taking many chances, writes Huang, a senior associate at the Carnegie Endowment, and a former country director for the World Bank in China. But protests motivated by economic injustice, such as the truckers who last week besieged a Shanghai port complaining about rising fuel costs, are growing more common. If China is unable to share its growth more equally, these could soon threaten the government’s hold on power.
Editorial comment: Protecting finance from its demons
Finance is too chaotic to deserve the label “system”. A better term is “network”. It is because of this intense interdependence that prudential supervision of individual institutions is insufficient. Regulators must understand the network. This task – “macroprudential policy”, as it is now called – looks as impossible as it is inescapable.
Gavyn Davies’ blog: Why has the US economy slowed?
The past week has seen new highs for the year in many major equity markets, including the US, says the FT blogger. However, oil prices have continued to climb in ominous fashion, and there have been some weaker signals from the initial economic activity indicators which have appeared for the month of April. In the US, for example, the important Philadelphia Fed index fell sharply, housing data continued to bump along the bottom, and initial unemployment claims were disappointing. Next Thursday will see the publication of the US GDP figures for 2011 Q1, which are likely to report quarterly annualised growth at only around 1.5 per cent, sharply down from the previous quarter. So why has the US economy slowed, and should we be worried about it?