Military throws Egypt into dangerous phase
By Una Galani
(The author is a Reuters Breakingviews columnist. The opinions expressed are her own)
Egypt is entering a dangerous period. The ousting of President Mohamed Mursi – the country’s first freely-elected leader – and the Muslim Brotherhood after just one year in power cements divisions and confirms the army’s role as kingmaker. A swift return to civilian democratic rule is critical but the path is fraught with social and economic risks.
How to cut the cord on China’s shadow banks
By John Foley
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
It’s time for some delicate surgery on China’s financial system. The growth of non-bank lending channels – collectively known as “shadow banking” – is basically helpful for the economy. But regular banks are in too deep. China’s financial regulators need to separate the siamese twins.
UK’s big build dreams still dogged by past binge
By Ian Campbell
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
The UK government wants austerity to pave the way for bold modernisation of Britain. In reality its cuts don’t reverse the previous explosion in government spending and there isn’t much money for its big infrastructure dreams.
China’s corporate spying is three-cornered problem
By John Foley
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
American prosecutors have targeted Chinese wind turbine maker Sinovel for allegedly stealing secrets from a U.S. rival. The threat of a $4.8 billion fine for a company with total assets of $4.6 billion sounds potent. But it doesn’t address the economic conditions that make China a target for accusations of ideas theft. Call it the corporate espionage triangle.
Fed’s sand will make Asia’s investment wheel creak
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Ben Bernanke has just emptied a big bucket of sand into Asia’s $5.5 trillion-a-year investment wheel. That’s bound to lead to a slowdown in economic activity across the world’s fastest-growing region.
France’s poisonous politics bound to hit economy
By Pierre Briançon
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
The string of political scandals hitting all French mainstream political parties couldn’t come at a worst time. The economy is in a recession, and fiscal austerity is amplifying the structural weaknesses which developed long before the financial crisis.
China bank rout favours big lenders over small
By John Foley
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
A pledge of support for cash-strapped lenders should take the fear out of China’s interbank market. After two weeks of spiking rates, the People’s Bank of China (PBOC) said on June 25 it had extended liquidity to some lenders, and would stand ready to help others. Its new stance will most benefit those in least need: China’s big banks.
Asia’s pain unevenly spread as China slows
By John Foley
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Asia’s falling markets reflect the belief that a slowdown in China will take its toll on the region. But things aren’t so straightforward. Look at what proportion of the region’s largest economies goes to China, and how important those exports are to domestic GDP. Despite a decade of rapid growth, the world’s second-largest economy has had a smaller impact on its neighbours than might be expected.
China’s bonfire of liquidities claims first victim
By John Foley
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
China’s bonfire of the liquidities has claimed its first victim: equities. Stocks in Shanghai and Shenzhen tumbled more than five percent on June 24 after the central bank published a letter suggesting it’s in no rush to help overstretched lenders continue in their bad habits. This tough new approach could mean a little more chaos will be injected into China’s financial system. For the economy overall, it’s both positive and helpful.
China credit squeeze challenges “age of ambiguity”
By John Foley
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Silence has been good policy for China. The authorities’ penchant for relying on the unsaid, especially when it comes to financial obligations, has been a useful tool for channeling funding to banks and companies. But recent ructions in the interbank market, where lenders turn for short-term funding, suggest the age of ambiguity may soon have to end.
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FEATURED VIDEO
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Breakingviews: Kingmaker army dangerous for EgyptJuly 4 - Egypt is entering a dangerous period, says Breakingviews. The ousting of President Mohamed Mursi after just one year confirms the army is kingmaker, and it’s a long road back to democracy.Video
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Breakingviews: Want to start a bank? Get in line, says IndiaJuly 4 - India's central bank has opened its once-a-decade lottery for banking licenses. Breakingviews' Andy Mukherjee weighs in on possible new lenders when only one in three Indians has a bank account.Video
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