Paced growth can not be attained without realizing that the new-normal is different than the old one
Güven Sak, PhD
08 June 2010
The financial market is going through a stressful period. If you want evidence, take a look back at last week. The U.S employment data showed that the recovery was not even as strong as they thought. When the new Hungarian government, while explaining why they would not be able to keep their election campaign promises, said 'we might end up like Greece', instead of saying 'we took over a wreck', everybody was worried sick. It was confirmed in the G20 meeting that there still is not a consensus on what the new-normal is. This is sad, of course. There still is not a wide unanimity that the new-normal would be different than it used to be. When the diagnosis is not unanimous, neither is the treatment. The markets are in such a mood that it seems as if they are guerillas combatting on enemy fi
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How did Starbucks get kicked out of Forbidden City?
Güven Sak, PhD
05 June 2010
Nowadays, I, myself, am once more bored of the country's agenda. If there is any of you who wants to rest their heads a little bit, like me, please step front. May I present you an article today, that has, just like Seinfeld, no subject? Let's give it a try. Did you know, in Forbidden City, located in Beijing, the capital of China, there once existed a Starbucks? I did not. It opened in 2000 and closed in 2007. Why was it closed? Along with a campaign 'our culture is being eroded' that was started in an internet blog site, the Starbucks Forbidden City had to be closed because of the growing public reaction. And where? In China, a country where even the internet restraints are so strict that 'Google' company recently decided to withdraw from the country, it seems the blogs can be effective.
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It is the result that should be taken into consideration, not the rhetoric
Güven Sak, PhD
03 June 2010
The Israeli raid against the six-ship flotilla which carried armless civilians, the fact that nine civilians, four of whom were citizens of the Turkish Republic, lost their lives during this raid, is utterly frustrating, agonizing. It must be condemned. Diplomatically expressed as 'disproportional use of power', the raid was, with the words of Barones Tonge, who was a speaker at the United Nations Palestine's Indispensable Rights Commission that I have recently attended, was a 'violent attack', just what the 'disproportional use of power' expression is trying to mask. Since our belongings are on their way back, the first thing to do now is try to understand what is going on so that we can find an answer to the question 'what in the world was that ship doing over there?' Letting rhetoric as
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What does leftist Lula do in Tehran?
Güven Sak, PhD
29 May 2010
It is obvious what rightist Erdoğan does in Tehran, is not it? Turkey is a non-permanent member of United Nations Security Council. The country is also a member of NATO. On top of it, Turkey is a neighbor of Iran. Under these circumstances, what else Mr. Erdoğan do but visit Tehran? You can question what leftist Lula does in Tehran; however the presence of Mr. Tayyip Erdoğan there must not be questioned. Let us see why. Please keep reading if you like to hear what happened in Tehran from me.
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Are you ready for a new period of exhaustion?
Güven Sak, PhD
25 May 2010
What the Greek crisis has to make us understand is this: the Greek issue got out of control because Angela Merkel, the Chancellor of Germany, did not act fast enough because of the elections in North Ren-the state of Westphalia. Since the politics has made the behaviors of electors in a state of Germany its main priority, financial markets all around the globe have started to fluctuate. An incident that could have been overcome with a low budget and limited inside regional borders, spread to the whole continent just because political remarks delayed the interventions and thus, the precautions that should have been taken could not have been. Are you aware of the lesson that should be learned from this? From this point on, politics is going to be considered of primary importance for economic
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Did you use to like your school apron?
Güven Sak, PhD
22 May 2010
Honestly, I do not have any memories related to my elementary school apron-good or bad. Do you? 'We used to wear it to school', that's all I remember. I do not recall ever mumbling about having to wear it everyday. You can even say it was good, really. What you would wear was definite every single morning. I think that I do the exact same thing nowadays. Always the same blazer jacket, the same kind of shirts and pants. Same brand shoes, too. It is truly comfortable. It seems to me this is a habit we have grown accustomed to from the early days of elementary school. Those were my feelings the other day while I was reading the article, 'Ministry of Education would allow informal clothing in schools'. Then I wondered, 'I never had a problem wearing it, but was this school apron habit, unique
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When will Greece form a debt swap?
Güven Sak, PhD
20 May 2010
Didn't we already know that the public finance was problematic in Greece? We did. But why is it that this piece of information didn't create a chaos until just now? Why did it take us until now to realize the spectre of public debt that has been haunting Europe? Are you aware, that there is actually no increase in the risks? It is just that tolerance to risk is decreasing. Sensitivity of balance sheets against risk all of a sudden increases. But how does this happen? Why do the risks that everyone was perfectly okay with carrying yesterday, become so unbearable, today? Unless this question is answered in a fulfilling manner, I think it is somewhat hard to discuss that the Greek crisis will not be able to be solved without a debt swap like the Brady Plan. Let's first have a look at the ques
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Why couldn’t Ivan Prado enter Israel?
Güven Sak, PhD
15 May 2010
This was featured on the Israeli Haaretz newspaper, last week. According to this, Spanish Ivan Prado was intervened at the Ben Gurion Airport and was denied entry Israel. The news said Ivan Prado was a famous Spanish clown and he did not go there to do sightseeing in Israel. What he wanted to do was to go to Ramallah, the capital of Palestine. His intention was to organize an International Clowns Conference. He was going to see an authorized person for this intention. There were various comments on the matter on the internet: On the one hand there were the ones who found it tragic that a clown was not let inside Israel and Ramallah while there were already so many of them around, and the ones who tried to make people notice Prado's anti-Israeli opinions, on the other. Everything I could fi
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The timing of the fiscal rule is quite correct
Güven Sak, PhD
13 May 2010
A spectre is haunting Europe: the spectre of the debt crisis. Despite the trillion dollar bail-out package which is not known how to make operational and the functions of which have still not been understood, there is no change in the Western front. The only operational result of the trillion dollar bail out package is the fact that the European Central Bank has started to make some moves in order to buy the Greek government debt securities (GDS) in secondary markets. This also counts, but there still hasn't been a structural attempt towards the public finances of problematic countries. Under these circumstances, the 'Fiscal Rule Law' draft that State Minister and Deputy Prime Minister Ali Babacan explained via a press meeting the other day is a right step taken to limit the effects of the
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Is this the first step of the Greece’s ‘Brady Plan’?
Güven Sak, PhD
11 May 2010
A serious step is eventually taken to prevent the crisis in Greece to spread all around the Eurozone. The first package of €110 billion was not enough. Now a second package of €750 billion is provided; €440 billion from the European Union member countries, €60 billion from the Commission, and €259 billion from the IMF. As a result, a liquidity package of almost $1 trillion, even bigger that the US bailout plan, was announced. So what happened? Is the Greek crisis solved now? Is not Portugal in danger anymore? Did the problems of Spain disappear? No; all problems still exist. But they are not reflected in the magnifying mirror now. With this package European Union saved time for pulling the Eurozone together. Measures that will prevent the transmission of the crisis rapidly all around the r
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