It is commendable that membership in the Eurozone has become an immediate task for this government – including joining the interim ERM2. But the decision-makers at the top fail to look critically at key system features of the Bulgarian banking system. They prefer to focus on the technical criteria without assessing the level and depth of the challenges ahead before the convergence of the Bulgarian banking system into the Euro area. Against this backdrop of events around the CCB crisis, how serious and credible is the institutional capacity in the central bank to tackle the banking and financial problems before reverting them to the Eurozone? The BNB oversees and guarantees the health of the banking system, at least in theory. Yet at the same time, two presidents, one
Ralf Waldo Emerson once said, that the money often cost too much. He is an American writer, who dedicated his life to the fight for individual freedom – something that, from today’s perspective, is considered a typical trait of American capitalism and a basic human right. Of course, living in the 18th century, the author had no concept of central banks and their policies, which reached new heights after the last global crisis and demonstrated to us that, when the central bank decides, money can cost too little. After 2008 US government started stimulating the economy and the banking sector in particular, by using various monetary tools. The officials introduced so called Quantitative easing (QE) programs and many tax breaks for individuals and business organizations, while the base
The recent sale of a significant minority equity stake in Rosneft caught the markets and analysts by surprise. The available information to date is limited only to a couple of announcements revealing few details. The deal is indeed of great complexity and the available details are not sufficient to decipher it. An initial analysis however leaves the impression that the announced buying consortium of Qatar’s sovereign wealth fund and Glencore might be not the only beneficial owner of the privatized 19.5% stake in Rosneft. On December 5, Rosneft issued 600 billion Rubles locally placed bonds maturing in 10 years. The Russian market is clearly not deep enough for an issue of that magnitude and such a long tenor. Most probably, the money ultimately came from the Russian central
The global outbreak of “The Great Depression” in 2008 coincided with a new political order in the region, which resulted from the non-interventionist US foreign policy of the Obama administration. It was then that Turkey became an ambitious regional player. In 2009, in his book The Next 100 Years: A Forecast for the 21st Century, George Friedman, founder and chairman of Geopolitical Futures and former chairman of Strategic Forecasting, predicted that Turkey will seek to return to its former Ottoman glory and will in thirty years catch up with Japan economically. Turkey has huge advantages compared to any other country in the world. It is both a secular and a Muslim country. The country is not isolated geographically and is on the crossway of three continents.
One of the benefits to European policymakers of Brexit is that it has dominated news coverage for months, diverting attention from several indicators that the banking crisis in Europe is inexorably worsening. When Italy announced, a few days after the Brexit vote, that it was preparing a €40 bn government recapitalisation of its banking system, Rahm Emanuel’s observation, “You never let a serious crisis go to waste” sprung to mind. Prime Minister Renzi’s proposal was notable because it contravenes the EU’s banking union rules obliging all creditors, including unguaranteed depositors, to be ‘bailed in’ before the question of public funds is supposed to arise. It is difficult to see a connection between the UK’s declaration of preference for self-government and the dramatic drops in bank share prices on