Dear patient readers,
I am behind the eight ball again on Links. I’ll have the full dose up by 8:00 AM.
‘Leap second’ set to delay midnight BBC (David L)
McDonald’s first “self-serve” being tested now Bits and PiecesBits and Pieces (furzy mouse)
Study Suggests That Google Has Its Thumb on Scale in Search New York Times. Quelle surprise!
Bitcoin Is Unsustainable Motherboard (reslic)
Fed rates hike raises issues for emerging markets Nouriel Roubini. Guardian
How one driver is helping rip off Uber in China Sydney Morning Herald (EM)
Is this the beginning of the end for Chinese stocks? Here’s what 11 top analysts have to say Sydney Morning Herald. EM:
I always enjoy the twits, erm I mean ‘highly-paid experts’, who try to pretend that this is more than an exercise in blind dart-throwing by trotting out precise-sounding numbers, e.g. ‘Mainland A shares could fall as much as 18 per cent before bottoming, Michael Shaoul, Marketfield’s chief executive, said’. Not 17% or 19%, or godforbid the further 50% which would merely take the mah-jongg parlors back to where they were 6 months ago … nope, 18% is the hard cap on the remaining selloff, and such is Mr. Shaoul’s confidence that he is willing to put your money where his mouth is.
Iceland Just Jailed Seven Bank Executives for Market Manipulation Nation of Change
Alexis Tsipras Lost His Cool! Observing Greece (IsabelPS). Be sure to read the comments. This bit is striking:
On June 17, Tsipras was saying during Austrian PM Faymann’s visit: ‘I am not the type of man that who, when in difficulties, throws the ball back to the people. If there is an agreement, it will be the goverment that will lift the weight of the decision and the same in case of non-agreement’. In 2011, Tsipras was accusing George Papandreou that his referendum would be like ‘playing dice with the country’.”
And this from comments:
Yes, it is preposterous. It is just a fig leaf for SYRIZA to cover its inability as a party to deal with the conseguences of their negotiations. You can say that they framed them, that they wanted to crush them, yes, everything. But this is what you wanted. Nobody forced Tsipras to bring down the previous goverment in December by violating the spirit of the Constitution about the presidential election. It was Tsipras’ choice, because he was eager to become PM. Now that he has trapped himself, between a plan that he fears will demolish his goverment if implemented and a default for which he hasn’t mandate, he throws the ball to the electorate, while changing the law about referenda 6 days before the referendum itself. Normally, there should be 2 committees formed, one for a “YES” and one for a “NO” campaign. Now this is a parody. What sort of campaign for YES or NO can you do in 6 days, with a question that is misleading and the people running to the gas stations and banks? Who will follow this campaign to get informed? This is parody of democracy at its best. Always fear parties that spout the word “democracy” every 30 seconds.
The referendum change seems stunning. Can any readers provide confirming or denying information (with links)? Update: here it is.
Pour un fédéralisme européen Le Monde (Swedish Lex)
Europe’s dream is dying in Greece Gideon Rachman, Financial Times. This all goes back to Dani Rodrick’s trilemma: you cannot have economic integration, national sovereignity, and democracy all at once.
Europe’s big guns warn Greek voters that a no vote means euro exit Guardian (furzy mouse)
No vote means isolation, Europe warns Greeks Financial Times
‘We refuse to accept it’: Greece set to sue as it faces euro exit Ambrose Evans-Pritchard, Telegraph (EM). This only gets more surreal. Many commentators have advocated a Grexit as the only way out for Greece. We had said a default in the Eurozone was probably better, but now that relations between the two sides have gotten so toxic, renegotiating Greek debt in default will be ugly, and the creditors could conceivably not play ball (as in leave Greece stuck with no ability to finance itself except at very high cost, if at all, and a primary deficit, which will force it into severe austerity to keep the government going, even if it starts issuing scrip for domestic use only). But the Greek government objects vociferously to the idea. So the election per them is not a mandate on a Grexit either. So what is it on? To have Syriza try again at the same failed strategy to get the creditors to relent, when it’s already clear that they are not moved by the views of Greek voters?
Grexit: The staggering cost of central bank dependence VoxEU. The remarks on most of the legal and political issues are sound, but the article is incorrect on a key issue: who bears the losses of the credit extended through the ELA. It’s not the citizens of Greece, as the article mistakenly claims. See here for details. But the piece is correct is that no ELA increase will kill the Greek banking system. That is also why the reaction of the Greek government, at least as reported by Ambrose Evans-Pritchard above, is so odd. The government seems to be acting as if the words said by the Eurozone leaders are a threat of future action, and Greece similarly is threatening back that it may go to the European Court of Justice to stop it. But the threat is in the action that the ECB has been taking all along, that of bare minimum increases in the ELA, and what is has already done, not making further increases. Does the government not get what is going on? Why is it not filing a case at the ECJ now if it wants to forestall what the ECB is doing?
European Court of Justice effectively rules that Eurozone is a shambles Bill Mitchell. In links yesterday but has new significance in light of the Greek government saying they’ll go to the ECJ if the ECB cuts or puts a ceiling on the ELA. Given what we understand to be Eurosystem rules (and no reader has disputed the information we’ve posted twice from a Jeffries analyst on this topic), it appears that the ECB has to cut off Greece in the event of an ECB default. But even if not, or there is arguably a conflict among ECB rules that needs to be resolved, this ruling indicates that the ECJ is even more strongly inclined than the US Supreme Court not to clip the wings of powerful players. (Separately, the ECB might choose not to lower the boom on Greece but tighten its choke chain even more…but whatever stance it takes, even if it might look on the surface to be less Greece-unfriendly, merely means it thinks the surest path to success is a war of attrition rather than frontal assault). Also notice this about our ongoing discussion of how EU/Eurozone membership means surrendering certain elements of national sovereignity to EU/Eurozone institutions: “From an Modern Monetary Theory (MMT) perspective, Germany abandoned its sovereignty when it entered the Eurozone and surrendered its capacity to issue its own currency.”
How British universities helped mould Syriza’s political elite Guardian (IsabelPS)
Many Greeks Still Want a Deal New York Times
Greece Rattles but Doesn’t Panic Markets Wall Street Journal
Greece’s IMF payment: When is a default not a default? Financial Times. Another boundary constraint: “Anything that could be perceived as special treatment for Greece is likely to prompt even more anger among emerging economies.”
U.S. Lifts Ban on Bahrain Aid New York Times (reslic)
Fight against TPP not over Bangkok Post (furzy mouse)
Davos Woman American Conservative (reslic)
NBC and Carlos Slim to Donald Trump: “You’re fired” Quartz (furzy mouse)
Insurers’ arguments key to Supreme Court decision Center for Public Integrity
Supreme Court Allows Use of Execution Drug New York Times
Sen. Jeff Sessions: Confederate Flag Represents “Fabulous Accomplishments” Intercept Reslic: “TPP was his broken clock moment.”
Puerto Rico Has No Easy Path Out of Debt Crisis Wall Street Journal
What Happened After the North Dakota Oil Boom Went Bust Atlantic (reslic)
Have the Saudis miscalculated the impact of lower crude prices on US production? Walter Kurtz (furzy mouse)
Slow-motion tragedy for American workers Center for Public Integrity (furzy mouse)
Are Uber drivers employees? New Yorker. One huge issue missed in Uber discussions: most Uber drivers don’t analyze what they make correctly. They don’t’ allow for the depreciation of the car. If the vehicle isn’t pretty old, that makes a big dent in their real earnings as opposed to their cash flow.
How Technology Is Destroying Jobs MIT Technology Review (David L)
US rules on overtime pay to be shaken up Financial Times
A Hard Day’s Work Deserves a Fair Day’s Pay Barack Obama, Huffington Post
Antidote du jour (Tim F):
See yesterday’s Links and Antidote du Jour here.