The Leap Newsletter

The LEAP/E2020 team wishes you all the best in 2012!

Excerpt from last GEAB - US institutional deadlock and the break-up of the traditional two-party system

From the beginning of 2010 our team had anticipated the state of institutional paralysis that has characterized the United States since the November 2010 elections. 2011 has allowed everyone to discover that, in fact, it had now become impossible for Washington to take any decision of importance, especially regarding economic and budgetary affairs, even though at the heart of the country's difficulties. Federal authorities are now unable to take measures to reduce the federal deficit, to adopt a sustainable federal budget, to implement policies to support the economy... Whether the Presidency, Congress or the Federal Reserve, each of these three key institutions is proving powerless to decide and/or implement meaningful policies. The example of the Fed’s inability to implement QE3 is indicative of the internal deadlock of the political system as it is now up against the public opposition of the Republican Party, the Tea Party and Occupy Wall Street (not to mention the outward opposition of most of the world’s central banks). And, far from improving, on the contrary the situation will get worse in 2012 and after. In fact, one of the major causes of this institutional deadlock is the break-up of the traditional two-party system that accelerated with the November 2010 Congressional elections...
LEAP/E2020 - Excerpt GEAB N°60 (Dec. 16, 2011)

GEAB : Des analyses sans équivalents du fait de l'indépendance complète de LEAP/E2020
LEAP/E2020 n'est financé que par les abonnements au GEAB. LEAP/E2020 ne reçoit aucun autre financement public ou privé, international, européen ou national. Cela permet aux analyses du GEAB d'être totalement indépendantes : un privilège rare parmi les think-tanks mondiaux.
LEAP/E2020

Bahrain police clash with mourners
Riot police in Bahrain fired tear gas, rubber bullets and stun grenades as they clashed with hundreds of opposition supporters following the politically charged funeral of a 15-year-old boy. Thousands of opposition supporters carrying Bahraini flags and chanting anti-government slogans converged on Sunday on the island of Sitra, south of the capital Manama, to mourn the death of Sayed Hashim Saeed.
AlJazeera

Egypt's Muslim Brotherhood plans to put treaty with Israel to a referendum
MB says 'will not recognize Israel under any circumstances'; move to cancel peace treaty could represent strategic chance too great for MB as it seeks international legitimacy. The Muslim Brotherhood, the overwhelming victor in the first round of elections for the Egyptian Parliament, has announced it will not recognize Israel and intends to bring the Israeli-Egyptian peace treaty to a referendum.
Haaretz

La nouvelle Constitution hongroise, aux accents nationalistes, entre en vigueur
Elaborée par et pour le premier ministre hongrois Viktor Orban, une nouvelle Constitution aux accents très nationalistes est entrée en vigueur dimanche 1er janvier, instaurant des réformes très controversées de la Banque centrale, de la justice et de la loi électorale, et ce en dépit des critiques internationales (lien abonnés).
Le Monde

Cars Are Set on Fire, and Los Angeles Is Set on Edge
For all its considerable delights, Southern California always seems faintly on the cusp of an apocalypse. There are palm trees, year-round gardens and splendid weather — it was 81 degrees and sunny on Sunday — but there are also mudslides, gang shootings, wildfires and earthquakes.
New Yrok Times

Retailers face being "squeezed to extinction"
More shops will collapse into administration or announce store closures in the next couple of weeks, afters suffering from "profits squeezed to extinction" as well as a fall in sales over Christmas, according to the head of Britain's retail trade body.
The Telegraph

High street braces for wave of failures as La Senza closes 80 shops
Analysts predict up to 40,000 could lose jobs as lingerie chain joins list of those struggling to contain their debts. Thousands of shop workers stand to lose their jobs this year as some of the high street's best-known names face financial ruin despite a rise in business over the holiday period.
The Guardian

China's yuan hits new high
The Chinese currency Renminbi, or the yuan, rose 148 basis points to a record high of 6.3009 against the US dollar on Friday, according to the China Foreign Exchange Trading System. In China's foreign exchange spot market, the yuan is allowed to rise or fall by 0.5 percent from the central parity rate each trading day. The central parity rate of the yuan against the US dollar is based on a weighted average of prices before the opening of the market each business day.
China Daily

Les Bourses asiatiques ont perdu autour de 20% en 2011
L'Asie boursière termine sa dernière séance de 2011 en légère hausse. Le Nikkei de Tokyo clôture ce vendredi sur une hausse de 0,67% à 8455,35 points. Ce qui n'empêche pas l'indice d'enregistrer une lourde perte de 17,46% sur l'année ( la pire depuis 1982), marquée au Japon par le séisme et le tsunami dévastateurs du 11 mars et la catastrophe nucléaire de Fukushima. L'opérateur de la centrale Tepco a d'ailleurs perdu plus de 90% de sa valeur depuis mars. Le Nikkei signe ainsi sa deuxième baisse annuelle consécutive et touche son plus bas niveau de fin d'année depuis 1982.
Le Figaro

New government reneges on campaign tax pledge
Going back on an election pledge not to raise taxes, the Popular Party government on Friday announced historic widespread 8.9 billion euros in cuts as countermeasures to a bring down an eight percent of GDP deficit for this year - two percentage points higher than the previous Socialist administration had forecast.
El Pais

Economic forecasters lose their way in extreme weather
WHO would have thought it? Certainly none of the 20-odd members of the economic forecasting panel this time last year. The rate of inflation turned out to be higher than the highest of their predictions, the budget deficit bigger than the biggest, and the sharemarket far lower than all but two thought likely.
Business Day

Foreign Central Banks Cut Treasury Holdings by Record
Holdings of U.S. Treasurys by foreign central banks has fallen by a record amount over the past four weeks according to the latest Federal Reserve data. The net $69 billion drop in Treasury holdings registered at the Fed by foreign official institutions comes as benchmark yields ended 2011 near record low levels and when the U.S. central bank is conducting Operation Twist, its $400 billion program to sell shorter-lived Treasury bonds and buy those with longer maturities.
CNBC

$6.3 Trillion Wiped Off Global Markets in 2011
Almost $6.3 trillion was erased from global stock markets this year as the euro zone financial crisis reverberated across the world in the latter half of 2011, calling into question the future of the world’s largest currency bloc.
CNBC

GEAB: Its analyses are unique because LEAP/E2020 is completely independent
LEAP/E2020 is funded through GEAB subscriptions only. LEAP/E2020 doesn't receive any public or private, international, European or national money. Thanks to this situation, LEAP's work and GEAB's analyses are completely independent... a rare privilege among global think-tanks.
LEAP/E2020

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