A blot against America

THERE is a moment in “The Plot Against America”, Philip Roth’s tale of America succumbing to 1930s-style authoritarianism, when the nine-year-old protagonist experiences a profound revulsion at the foibles on which wickedness thrives. “Never in my life had I so harshly judged any adult,” he recalls of his Jewish aunt’s preening over a brief interaction with the anti-Semitic president, Charles Lindbergh. “Nor had I understood till then how the shameless vanity of utter fools can so strongly determine the fate of others.” That is as much respite as the recently deceased author, who combined a stubborn faith in America with a gloomy view of its politics, allows his reader. There is no chance of America sharing his awakening. The power of the boy’s epiphany lies not only in its clarity, but also in its futility.

Roth’s pessimism about the prospect of national redemption should be instructive to critics of President Donald Trump’s policy of caging migrant children in isolation from...Continue reading

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A lawsuit reveals how peculiar Harvard’s definition of merit is

Admission of gilt

ABBOTT LAWRENCE LOWELL, the president of Harvard from 1909 until 1933, thought the university had too many Jews. In the first year of Lowell’s presidency, they made up 10% of the student body. By 1922 their numbers had more than doubled. To address what he called “the Hebrew problem”, Lowell proposed an explicit Jewish quota of 15%. When that proved controversial, he set about making “a rule whose motive was less obvious on its face” to deny admission to students suspected of being Jewish. Admission to Harvard, previously granted by meeting a clear academic cut-off, became more nebulous—based more heavily on the “character and fitness” of applicants. The new “holistic” admissions policy worked as intended, successfully suppressing Jewish admissions.

Harvard, like many of America’s top universities, retains a holistic admissions process. Unlike elite universities in most other countries, American colleges do not simply...Continue reading

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In praise of gentrification

GENTRIFIER has surpassed many worthier slurs to become the dirtiest word in American cities. In the popular telling, hordes of well-to-do whites are descending upon poor, minority neighbourhoods that were made to endure decades of discrimination. With their avocado on toast, beard oil and cappuccinos, these people snuff out local culture. As rents rise, lifelong residents are evicted and forced to leave. In this view, the quintessential scene might be one witnessed in Oakland, California, where a miserable-looking homeless encampment rests a mere ten-minute walk from a Whole Foods landscaped with palm trees and bougainvillea, offering chia and flax seed upon entry. An ancient, sinister force lurks behind the overpriced produce. “‘Gentrification’ is but a more pleasing name for white supremacy,” wrote Ta-Nehisi Coates. It is “the interest on enslavement, the interest on Jim Crow, the interest on redlining, compounding across the years.”

This story is better described as an urban myth. The...Continue reading

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Ford has ambitious plans for Detroit’s most beautiful ruin

Fixer-upper

DETROITERS still know how to throw a party. On June 19th more than 4,000 of the Motor City’s residents, government officials, artists, employees of Ford and members of the Ford family gathered at Michigan Central Station, a huge, dilapidated 18-floor Beaux-Arts hulk covered with graffiti, to celebrate its planned rebirth with speeches, music and poetry. Once the world’s tallest railway station, the vacant building became emblematic of the city’s descent into bankruptcy and despair. ‘“The train station is dead’ meant ‘Detroit is dead’,” said Mike Duggan, the mayor of Detroit, who was among the revellers. From the moment the last train left the station in 1988, its demolition was often discussed. Then Ford struck a deal to buy what Detroiters now hope will become a symbol of the city’s rebirth.

Detroit’s comeback is still tentative. Nearly all the recovery has happened in downtown and midtown, an area covering just seven of the city’s 139...Continue reading

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Small-town American newspapers are surprisingly resilient

JAY NOLAN surveys his media empire from a shed-like building outside London, Kentucky. On his desk is a stack of eight newspapers, including the Berea Citizen (“established in 1899”, circulation 4,511), the Mountain Advocate (“since 1904”, circulation 4,500) and the Pineville Sun-Cumberland Courier (“celebrating 109 years”, circulation 1,646).

Each paper is under local management, with its own publisher and editor, but Nolan Group Newspapers owns a majority stake in all of them and prints them at its press outside London. Together, the eight papers have a combined circulation of about 25,000 and employ a dozen journalists and nine ad-sales representatives. They bring in around $2m in revenue, perhaps $3m in a good year, with a profit margin of about 10%, says Mr Nolan.

The local-newspaper business is not going to make him rich. Which is why he also owns J. Frank Publishing, which undertakes contract...Continue reading

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America’s spat with the UN Human Rights Council

Haley storm

OF ALL the international arrangements President Donald Trump has forsaken, the UN Human Rights Council deserves the least sympathy. In announcing America’s withdrawal from the Geneva-based body, America’s ambassador to the UN, Nikki Haley, called it, “a protector of human-rights abusers and a cesspool of political bias.” Given that it currently includes abusers such as Congo and Venezuela among its 47 members, and is disproportionately fixated on alleged Israeli abuses, that was hard to deny. Yet America’s withdrawal will only make it harder to improve a body that has, despite its flaws, shown recent signs of promise. It also represents another small, but conspicuous, dent in America’s international leadership.

The council was formed in 2006, as the successor to the terminally discredited UN Commission on Human Rights, a body now best remembered for having had Muammar Qaddafi, Libya’s then dictator, as its chairman a couple of years before its...Continue reading

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China considers its response to Donald Trump’s proposed tariffs

The serried ranks

FOR now, at least, when speaking of the trade dispute with America, China’s government is taking a more-in-sorrow-than-in-anger tone. That helps explain the Chinese public’s surprisingly measured views of Donald Trump, and gives the Chinese government some breathing room to consider its options.

The state media have so far taken the high ground. True, the Global Times, a chest-thumping tabloid, accused the American president of “gambling” that China will be cowed by his “capricious and obstinate attitude”. No country can isolate itself from globalisation, said the Xinhua news agency: “The wise man builds bridges, the fool builds walls.” A new Xinhua web page popped up on June 20th, tracking multilateral deals that Mr Trump has quit, including on trade, climate change and Iranian nuclear arms.

But China has yet to debate, publicly, how to handle an American president who is an avowed populist...Continue reading

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Abraaj, a Middle Eastern private-equity firm, files for bankruptcy

UNTIL recently the Abraaj Group, aprivate-equity firm based in Dubai, was riding high. It was one of just a few such firms focused on emerging markets, and a darling of “impact investors”, who seek social or environmental returns, not just financial ones. Assets under management of $13.6bn made it the largest private-equity firm in the Middle East, and the 42nd-largest globally in 2017. Its Pakistani founder and boss, Arif Naqvi, a regular at Davos and a patron of the arts, had won awards for philanthropy. It is all the more surprising, then, that basic corporate-governance missteps led his firm to file for provisional liquidation on June 14th.

The problems began in late 2017 when four investors in its $1bn health-care fund, including the Bill & Melinda Gates Foundation and the private-sector arm of the World Bank, grew worried. Nearly $280m of $545m they had been asked for was not promptly spent on acquisitions, as is standard in the industry. Abraaj blamed delays in the...Continue reading

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Most stockmarket returns come from a tiny fraction of shares

IN his book about the use of language, “The King’s English”, Kingsley Amis describes a tug-of-war. On one side are “berks”, careless and coarse, who would destroy the language by polluting it. On the other side are priggish “wankers”, who would destroy it by sterilisation.

The battle lines look similar in investment. The divide is not on points of grammar but on attitudes towards a handful of modish companies, known as FAANG. These stocks (Facebook, Amazon, Apple, Netflix and Google) have been the motor of the S&P 500 (see chart). All but Apple hit record highs on June 20th. Fill your boots is the attitude of coarse stockmarket berks. FAANG makes more sense than stocks in dying industries. For the prigs, the mania for FAANG stocks is as abhorrent as a split infinitive. The high-minded investor stands apart from the herd.

In matters of grammar, the unsure often follow the sticklers. They at least have rules. But they are often too rigid. Stockmarket sticklers can similarly lead others...Continue reading

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Hedge funds worry about the legal risks of using “alternative” data

“QUANT” (quantitative) hedge funds, which craft elaborate algorithms to make trading decisions, rely on access to information. That used to mean market data, such as prices and trading volume. But some now seek an edge in novel sources. An industry has sprung up to serve them with, and help them analyse, “alternative” data, such as those gleaned from satellite images or by scraping websites. Many of these data firms have been founded by entrepreneurs, but some quant funds themselves are getting involved. Winton, a large London-based fund, is spinning off Hivemind, a data-analysis unit. A full-time management team was announced on June 18th.

For funds making macroeconomic bets by trading in, say, currencies or government bonds, real-time measures of inflation (scraped from e-commerce sites) or trade flows (from shipping data) can be better and more timely than the output of national statistics agencies. Funds trading in individual firms’ shares can infer information on sales from satellite...Continue reading

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Giddy property prices are a test for Swedish policymakers

ULF DANIELSSON is thinking of buying a holiday home—or even a new house, so that he, his wife and two children can have a garden and more space than in their flat in Uppsala. He can afford either, he says, and as a professor of astrophysics is surely able to work that out. But he is hesitating, lest the giddy rise in Swedish property prices end in an ugly crash. “You risk having a big loan that’s worth more than the house,” he says.

The property market has fallen a little closer to Earth: prices dropped by 9% between September and January, largely because of a surfeit of pricey new flats. They then steadied, and are around 5% below the peak—and 50% higher than at the start of 2013, calculates Valueguard, a data provider. As Swedes have borrowed to buy, their debts have risen. Finansinspektionen (FI), the financial-stability supervisor, estimates that borrowers’ debts rose by 36% between 2012 and 2017, while disposable incomes went up by 13%. Almost a fifth of households with new mortgages owe more than six times net income.

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France and Germany finally have a common position on euro-zone reform

Roofers’ convention

THE president of the European Commission, Jean-Claude Juncker, likes to compare the euro zone to a house in need of repair. Fix the roof, he counsels, while the economic weather is favourable. Leaders from across the European Union will have the opportunity to take that advice when the European Council meets in Brussels on June 28th-29th.

In preparation Emmanuel Macron, France’s president, and Angela Merkel, Germany’s chancellor, laid out joint proposals for reforms on June 19th. The result of weeks of ministerial negotiation, they reconciled long-standing differences on the future of the currency bloc and set the scene for discussion at the wider summit. In a victory for Mr Macron, the Germans have consented to a euro-zone budget. In other areas, notably banking reform, progress is likely to be halting.

The reforms aspire to mend the institutional weaknesses revealed during the years following the financial crisis. Lacking control...Continue reading

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Why countries like Argentina and Turkey fret about exchange rates

IMAGINE if Milton Friedman had been put in charge of a central bank, only to lose his job for expanding the money supply too quickly. Or if Robert Shiller, the Nobel-prizewinning author of “Irrational Exuberance”, were given a similar post, only to depart having allowed a stockmarket bubble to inflate. That is the kind of irony that attended the resignation under pressure of Federico Sturzenegger as governor of Argentina’s central bank on June 14th, a casualty of deepening turmoil in emerging markets.

Mr Sturzenegger was a former professor at Universidad Torcuato Di Tella in Buenos Aires. His most-cited paper showed that stated currency policy was often a poor guide to actual policy. Many countries claim to let their currencies float freely but in fact “intervene recurrently to stabilise their exchange rates”. Their deeds often belie their words.

Mr Sturzenegger lost his job for much the same thing. Financial markets struggled to reconcile his statements on the currency with his...Continue reading

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A full-blown trade war between America and China looks likely

IT IS becoming increasingly likely that the phoney trade war between America and China will develop into the real thing. On June 15th the Trump administration published two lists of Chinese products it plans to hit with tariffs of 25%, worth $50bn in 2018. The first will come into force on July 6th. The Chinese snapped back with their own list, laying out a retaliation of equal size. Then on June 18th President Donald Trump directed Robert Lighthizer, the United States Trade Representative (USTR), to draw up a further list of products worth $200bn that would face tariffs of 10%, and threatened yet another, covering an additional $200bn of goods, if the Chinese retaliated again. At least some of these tough words will probably turn into deeds. Both sides can expect to take casualties.

China regards the first round of American tariffs as a unilateral violation of global trading rules. It has lodged a complaint at the World Trade Organisation (WTO). But Mr Trump’s team maintains that China started the...Continue reading

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Sino-American interdependence has been a force for geopolitical stability

IN THE 1990s America and Europe had a trade dispute over bananas. No one worried that tanks might soon roll as a result. But trade is about more than economics. The European Union, the world’s most ambitious free-trade area, was founded on the idea that trade integration would make war between members “not merely unthinkable, but materially impossible”. As the risk of a serious Sino-American trade war grows, attention is mostly focused on the prospect of dearer iPhones and unhappy soyabean farmers. But the stakes are much higher.

China’s economic miracle could not help but provoke geopolitical stress, given its size and illiberality. Relations between America and China are built on mutual suspicion. Geopolitical rivalry has been moderated, however, by economic interdependence: a mutual entanglement some economics wags have dubbed “Chimerica”.

As China opened up, American consumers hoovered up cheap Chinese goods. American firms built China into their supply chains, enjoying low...Continue reading

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Japan's Yen: A Currency for All Seasons?

It’s been a stormy 2018 for markets, with volatility returning, trade tensions ratcheting higher and global growth proving less solid than expected. Investors looking for the financial equivalent of all-weather gear might find it in the Japanese yen.

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Beauty Stocks' Rise Is Looking Increasingly Cosmetic

Chinese shoppers have boosted the likes of Estée Lauder and Shiseido, but investors should remember fashions can be fickle.

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The Supreme Court dodges big decisions on partisan redistricting

IN 2004, Justice Anthony Kennedy lamented that state legislators are “in the business of rigging elections” by drawing highly skewed electoral lines. If gerrymandering could be hemmed in by a “workable” standard for policing maps, he continued, “courts should be prepared to order relief”. Fourteen years later, on June 17th, in two cases lined up for the Supreme Court to do just that, the justices again demurred—this time unanimously. Challenges to extreme gerrymanders in Wisconsin and Maryland—one favouring Republicans, the other Democrats—faltered on technical grounds. 

The Wisconsin case, Gill v Whitford, ended in an anti-climatic fizzle: the plaintiffs lacked the requisite “standing” to sue, Chief Justice John Roberts wrote, so the court is powerless to evaluate the merits of their claims. The chief reasoned that voters complaining about the gerrymander—in which Republicans took 60 of 99 state assembly seats in 2012 despite...Continue reading

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The Other Yield Curve Investors Should Watch as Trouble Mounts

Escalating trade tensions have helped push the U.S. Treasury yield curve to its flattest in more than a decade. This flattening is watched closely by investors as an indicator of economic trouble ahead. But another curve deserves attention too—and it is getting steeper.

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Xiaomi Will Have to Dial Down Valuation Hopes

The tech company has postponed plans for a mainland Chinese listing—a blow to its hopes of a high valuation.

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Can't Anyone Here Cook Anymore?

Delivery apps like Grubhub, meal kits and takeout are a rising threat to supermarkets like Kroger and Walmart and packaged food companies like Kraft Heinz

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Of 100 African football officials offered cash, only three declined

“FOR shopping,” says a man, laying $65,000 on a table. “Thank you,” says Kwesi Nyantakyi, the president of the Ghana Football Association, scooping it into a plastic bag. The bribe was a set-up, secretly filmed for a documentary by Anas Aremeyaw Anas, an undercover journalist. So was a sponsorship deal which Mr Nyantakyi appears to negotiate, taking a cut through his own private company. The film-makers offered money to more than 100 mostly west African football officials, including a Kenyan referee due to officiate at this month’s World Cup. Only three declined.

The revelations have thrown Ghanaian football into turmoil. Mr Nyantakyi, who denies wrongdoing, has resigned. Domestic matches have been suspended indefinitely. On June 7th the government said it would dissolve the football association. It has been badly and crookedly managed for decades, which is why Ghana, a football-mad country, has a league that no one wants to watch.

In the 1970s fans would hang from...Continue reading

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Burnt votes and an election recount might plunge Iraq into crisis

Voters’ wishes to ashes

WHAT would politicians the world over like to do when they lose an election? Annul the results and burn the ballots, of course. In Iraq such dreams come true. On June 6th outgoing MPs voted to hold a recount of Iraq’s election and sack the head of the electoral commission. They were furious that a populist Shia cleric, Muqtada al-Sadr, won the poll, held in May. Then, on June 10th, a warehouse in Baghdad containing a million ballots went up in flames. Firefighters claim to have saved most of them, but the equipment for counting the votes was destroyed.

Weary of the democratic process, Mr Sadr and his rivals are again readying their militias. An arms cache that exploded under a mosque in Mr Sadr’s Baghdad stronghold killed about 20 residents and brought his militia, Saraya Salam, onto the streets. “Certain parties are trying to drag Iraq into civil war,” he warned.

The fiercest rancour is between the Shia factions vying for the...Continue reading

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Why Arab states have lots of expensive villas

THE billboards almost seem to taunt motorists crawling through traffic below. They hawk luxurious town houses and villas with sumptuous pools in compounds that sound like Californian suburbs: Palm Hills, Eastown, Allegria. “Welcome to the greener side of life,” oozes one sign. But this is not California. It is Cairo, Egypt’s chaotic and crowded capital. The road is lined with endless rows of ramshackle redbrick buildings. Most are unfinished, their innards exposed, steel bars poking from the rooftops. The greener side of life is many kilometres away.

The drive along Cairo’s ring road is one sign of a paradoxical problem. Egypt has both a building boom and a housing shortage. At the high end, business is roaring. Developers are building tens of thousands of homes in upscale compounds, drawing young families with the promise of an escape from the city. But for most Egyptians these homes are out of reach. Villas can start at 10m Egyptian pounds ($560,000)—about 200 years’ pay at average...Continue reading

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The battle begins for Hodeida, Yemen’s lifeline

THE war in Yemen has entered what may be a decisive phase. Early on June 13th convoys of Yemeni fighters, backed by Saudi Arabia and the United Arab Emirates (UAE), advanced north along the coast towards Hodeida. The city is held by the Houthis, Shia rebels who seized the capital, Sana’a, in 2015. Emirati jets and warships supported the attackers. One aid-worker counted more than 30 air strikes in the first half-hour of fighting.

Hodeida is Yemen’s main port. It handles the humanitarian aid on which four out of five Yemenis depend. Prolonged fighting could leave millions at risk of starvation. The Saudi-led coalition promises to keep the port operational, but it could be damaged either in combat or by sabotage (the Houthis reportedly placed landmines around the city). Saudi Arabia says the rebels use it to smuggle Iranian-made missiles, which they have fired at the kingdom.

The days before the offensive saw frantic efforts to avert it. Martin Griffiths, the UN envoy to...Continue reading

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Congo’s Kabila chases an unconstitutional, unpopular re-election

In Tanzania, getting impregnated also means getting expelled from school

MARY (not her real name) was 16 when she became pregnant. The father sold chips by the road near her home in northern Tanzania. She felt special when he gave her money. But when her belly swelled, he ran off. At school she was caned in front of teachers, pupils and her own shamefaced parents. Then she was expelled. “I would not have had sex”, she says, “if I knew you could get pregnant after doing it once.”

A quarter of Tanzanian girls aged 15-19 are pregnant or have given birth. The government’s response is to kick them out of school for good. Official statistics record that between 2003 and 2011, more than 55,000 girls dropped out because of pregnancy. This is surely a vast underestimate; cases are often recorded as simple truancy. The main way back into education is through vocational training or at a fee-paying school, which most cannot afford. This policy is reinforced by compulsory pregnancy tests. Teachers pull girls out of class to give a urine sample or, more often, to...Continue reading

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Can refugees help to plug Europe’s skilled-labour gaps?

THE canteen of Stockholm University could scarcely be more Swedish. Young blond students sip coffee and tap away on Macs. In room 3.89, an outpost of the campus, is another, newer Sweden. Refugees, all of them teachers, from lands far to the south and east are preparing for the classrooms of their new home. Several keep their coats on as Khadije Obeid takes them through the basics of the curriculum and shows a YouTube clip about education law. “In Syria the teacher has much authority,” says Samer, an English teacher, as he raises his hand above his head. “Here he is equal to the students,” he adds as he lowers it.

The ten women and seven men are on a “fast-track” programme for refugees with experience in occupations where labour is short. As well as learning Swedish, they get 26 weeks of daily classes, teaching practice and mentoring. The hope is that they will then train or, if their previous qualifications are recognised, go straight to the classroom. The government is running some 30...Continue reading

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How open is America?

“JUSTIN has agreed to cut all tariffs and all trade barriers between Canada and the United States,” claimed President Donald Trump to laughter on June 8th, at the G7 summit in Quebec. The next day, in apparent seriousness, Mr Trump—who has slapped tariffs and quotas on imports of aluminium and steel from all the G7 countries, and others—called for unfettered trade within the group: “No tariffs, no barriers. That’s the way it should be.”

Over the next two days a more familiar Mr Trump reappeared. After Mr Trudeau said, at a post-summit press conference, that Canada would not be pushed around, he fired off a barrage of tweets calling him “very dishonest & weak”. He blasted Europe too. And he tweeted: “Sorry, we cannot let our friends, or enemies, take advantage of us on Trade anymore.”

Suspend disbelief and suppose that Mr Trump’s offer of a barrier-free world is serious. He may want to tear down tariffs and quotas out of a yearning for open markets and lower...Continue reading

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How to play Argentina

THERE is a type of footballer who inspires the affection of fans and the ire of coaches. He is talented, usually extravagantly so. But he is also wayward to the same lavish degree. Discipline seems beyond him, on or off the pitch. It was said of one of this kind, Stan Bowles of Queens Park Rangers and England, that if he could pass a betting shop as well as he passed a ball he’d be a rich man.

Which brings us, naturally, to Argentina—not to its footballers, who have mostly fulfilled their potential, but to its economy, which has not. A century ago, it was the country of the future. It betrayed that promise without ever quite extinguishing hopes that it might eventually live up to it. Like a talented but troublesome sportsman, it keeps being given another chance. The board of the IMF will soon approve a $50bn support package for Argentina. It has had countless such programmes in the past without much changing. The fund is betting that this time is different. Should investors make a similar...Continue reading

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China’s tighter regulation of shadow banks begins to bite

THE teller at ICBC, China’s (and the world’s) biggest bank, ushers a new, well-heeled customer into a private room. It is not for VIP treatment but a stern warning. The customer wants to invest in products offering higher returns than a basic savings account. The teller fixes a camera on her and reels off a series of questions. Are you aware that prices can go down as well as up? Do you understand that the bank does not guarantee this product? Only when the customer has been recorded saying “yes” does she get her wish.

Some complain that these videotaped agreements, now mandatory at Chinese banks selling similar investment products, feel like interrogations. But for the financial system, they are a step away from the precipice. Banks have used such transactions to channel cash into off-balance-sheet loans, serving riskier corners of the economy. Firms with little lending expertise have also muscled into the same space.

The catch-all phrase to describe this is shadow banking. It is...Continue reading

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Other American banks may have misbehaved as Wells Fargo did. Which ones?

Role model

IF THERE is a single example of how dramatically the regulatory environment has changed for American banks in the past 18 months, it may be the trickle of information that has recently emerged about an inquiry into their sales practices. The Office of the Comptroller of the Currency (OCC), a banking watchdog, began it in 2016 after widespread malpractice was uncovered at Wells Fargo, one of the country’s biggest banks. It ended the inquiry quietly by writing to several banks on June 4th; it sent the letters to Congress on June 11th. The public learned of the probe only because of diligent reporting by American Banker, a trade publication which appears to have gleaned its information mainly from banking consultants.

The OCC responded to American Banker’s report by releasing enough information to suggest that some banks were guilty of at least minor jiggery-pokery. It confirmed as much in testy exchanges between...Continue reading

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Rate rises affect global markets—and may feed back to America

ON JUNE 13th the Federal Reserve raised its benchmark interest rate by a quarter of a percentage point, the seventh such increase since it began shouldering rates away from zero in December 2015. Markets shrugged—a rather different reaction from the one that followed a policy adjustment made five years ago this month. The chairman then, Ben Bernanke, dared advise investors that the Fed might soon start winding down its stimulative bond-purchases. Traders fell to their fainting couches, but not before pausing to sell. Yields on ten-year Treasury bonds leapt. Currencies around the world flopped. This “taper tantrum”, as it became known, raised concerns that Fed tightening might so perturb global markets that America itself could suffer. Having survived both tapering and rate increases, Fed officials now seem inclined to dismiss such worries. They should not. The danger of a nasty Fed feedback loop remains.

Wise central bankers are prepared for ill winds blowing from abroad. Thanks to...Continue reading

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As Western lenders retreat, African banks see an opportunity

ADE AYEYEMI’S office in Lomé, the capital of Togo, is a good place to think about crossing borders. Ghana is ten minutes’ drive away. From his window the boss of Ecobank can watch trucks rumble along the seafront, some bound for Burkina Faso, a day’s journey, or Mali, perhaps another day on. At night, cargo ships twinkle offshore. From here Ecobank’s vision—“to integrate the continent”, Mr Ayeyemi says—is clear. Whether it will be profitable is less obvious.

Ecobank was founded in 1985 by business leaders with backing from the Economic Community of West African States, a regional bloc. It has branches in 33 countries, more than any other African bank (see chart). It is not alone in its ambitions. Nigeria’s United Bank for Africa (UBA) wants to make half its profits elsewhere in the continent by 2022. South Africa’s Standard Bank recently opened in Ivory Coast, its 20th African country. Moroccan banks are trekking across the Sahara.

African bankers have long preached...Continue reading

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The hounding of Greece’s former statistics chief is disturbing

IMAGINE the tale of Sisyphus, the mythical king doomed to spend eternity pushing a boulder up a hill only for it to roll back down, retold by Kafka. The result would be very like the tortuous story of Andreas Georgiou, Greece’s former statistics chief.

Since 2011 Mr Georgiou has faced several criminal charges. One is that he inflated budget-deficit figures, forcing Greece to seek a bail-out and resulting in alleged damages of €171bn ($190bn). Another is that he violated his duty by failing to seek approval from the statistical agency’s board before sending the figures to the European authorities.

Although Mr Georgiou was acquitted several times on both charges, the acquittals were annulled and he was retried. In 2017 he was found guilty of a violation of duty. He has now learnt that the Supreme Court had rejected his appeal, rendering the conviction final. It carries a two-year suspended sentence. In May prosecutors said they were refiling the charges that he inflated...Continue reading

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Pakistan faces a currency crisis. Who will help?

IN 1918 a British army officer brought his frayed football to be repaired at a factory in Sialkot, a city in what is now Pakistan. Although more accustomed to making tennis racquets and cricket bats, a local artisan was nonetheless able to restitch the ball and, even better, replicate it, according to the Sialkot Chamber of Commerce and Industry. Over the next 100 years, the city has prospered as a manufacturing hub, making surgical, leather and sporting goods. It exported over 920 tonnes of sports balls in the first three months of 2018, according to Sialkot Dry Port Trust. It is even the source of the (stitch-less) Adidas footballs that will be trapped, dribbled and passed in the World Cup beginning this week.

Despite this sporting contribution, however, Pakistan’s exports as a whole have lagged behind the country’s aspirations. Its import bill, including onerous payments for oil, has expanded uncomfortably, raising its current-account deficit to 5.3% of GDP this fiscal year (which...Continue reading

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South Korea’s ruling party wins a landslide victory in local elections

Moon is the star

MOON JAE-IN, South Korea’s president, took advantage of his country’s early-voting system to cast an advance ballot in provincial and municipal elections. When the day of the vote came, on June 13th, he went for a hike. He ambled up Bugaksan mountain in shorts, hiking shoes and a short-sleeved check shirt, his dog Maru padding along obediently by his side.

Mr Moon’s relaxed air was entirely justified. A few hours later exit polls indicated that his left-leaning Minjoo Party had triumphed in elections that were widely seen as a verdict on his first year in office (he became president after a snap election in May 2017). The party won all but three of the country’s 17 races for mayor or governor—an unprecedented landslide. It also snagged 11 out of 12 seats in the National Assembly that had been up for grabs in by-elections, strengthening Mr Moon’s minority government, although it is still well short of a majority. At 60%, turnout was...Continue reading

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Afghanistan’s passion for cricket reaches fever pitch

Willow, leather and grit

WHEN they win, the skies ring with joyful gunfire. Afghanistan’s cricket team is wildly popular. They are mobbed in the street and featured in endless ads. After one victory, staff at a European embassy in Kabul mistook the celebrations for an attack on their compound.

On June 14th Afghanistan became the 12th country to play test cricket, taking on India in Bangalore. Test matches, the game’s oldest format, last for up to five days and can be played only by an elite club of nations selected by the International Cricket Council. Afghanistan’s ascent from cricketing obscurity to “test status” is a rare source of national pride in a country torn apart by conflict. Its progress is all the more remarkable given that its team cannot play at home. Other sides refuse to visit Afghanistan for fear of being blown up. So Afghans have to play their “home” matches in India.

Until recently, cricket was virtually unknown in Afghanistan....Continue reading

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Indian states are testing a new way of setting development priorities

IN A country as big and poor as India, the scale of human need can seem daunting. Yet the immensity of the mountain is not the sole problem. Just as tricky is finding the best angle of approach. Alas, the vote-hungry politicians, stodgy bureaucrats, dreamy professors and opportunistic middlemen who often end up steering policy do not always succeed in making the most of scarce resources.

Take the town of Panipat in Haryana, a state that abuts the national capital, Delhi. Last year auditors from the central government found that it had dedicated 60% of its budget from Beti Bachao, a national scheme meant to correct gender imbalances by fostering and educating girls, to erecting a “themed gate” at the entrance to the town that proclaims Panipat’s bold commitment to this worthy goal. Such wasteful boasting is not unique. Since today’s national government took office in 2014 it has, by official count, spent some $643m (twice what the previous one did) on publicising its own programmes and...Continue reading

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China fights Taiwan on airline websites

GIVEN all the hoopla of President Donald Trump’s summit with Kim Jong Un, North Korea’s dictator, the opening on the same day of a new American not-quite-an-embassy in Taipei was never going to hog the headlines. Yet to judge by how much Chinese officials have harangued American diplomats and congressmen about who was going to attend the ceremony in Taiwan’s capital, China appears to care every bit as much and perhaps more about America’s actions in Taiwan than about geopolitical rivalry on the Korean peninsula.

Since 1979, when America broke diplomatic relations with Taiwan in order to open them with China, its “one-China policy” has been the bedrock of dealings with China. This means never referring to Taiwan as a country and always “acknowledging” that both China and Taiwan hold to the idea that there is but one China, even if the two sides disagree over the definition. The fudge has allowed America to enjoy close unofficial relations with Taiwan. China rarely appeared bothered by...Continue reading

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Argentina’s central-bank president resigns

ON JUNE 14th, a day on which the peso fell by 6.1% against the dollar, Federico Sturzenegger tendered his resignation. The president of Argentina’s central bank had little choice. He was the victim of a sustained run on the currency, which has lost more than a quarter of its value against the dollar since the end of April. Its slide had forced the central bank to raise interest rates sharply in April and May, from 27.25% to 40%, and prompted the government to seek assistance from the IMF. A $50bn credit line, announced on June 7th, was supposed to calm investors’ nerves. But the latest plunge and Mr Sturzenegger’s departure show that the turmoil is far from over.

Mr Sturzenegger is not to blame for the run on the peso. Argentina’s problems began in late April after American ten-year Treasury yields rose to 3% for the first time since 2014, prompting a widespread sell-off in emerging markets. But critics accused him of exacerbating the problem by sending confusing signals about...Continue reading

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America’s rising suicide rate

THIS month, the Centres for Disease Control (CDC) released a report suggesting that America’s suicide rate increased by 25% between 1999 and 2016. The climb is from a historic low at the turn of the millennium and American suicide rates overall are still not significantly above those of other high-income countries.  Nonetheless, World Health Organisation estimates suggest that out of its 183 member countries the United States had the seventh largest percentage increase in suicide rates between 2000 and 2016. Every suicide can have multiple causes, and the CDC does not offer a simple explanation for the rise. But other research suggests that one factor behind the rising suicide rate is an erosion of the privileged status of white men.

Nearly 45,000 Americans took their own lives in 2016, and suicide is an important part of the rising number of “deaths of despair” (also including drug overdoses and liver disease) described by Anne Case and Angus Deaton, economists. These causes of death have increased the overall mortality rate amongst...Continue reading

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Whaling in Alaska

A whale of a time

IT IS whaling season in Utqiagvik, the newly official—as well as ancient indigenous—name for Barrow, Alaska’s, and therefore America’s, most northerly settlement. This village of about 4,500 residents, the majority of whom are Inupiaq, sits at the edge of the Arctic Ocean. Whaling season is a time of year when the community comes together around thousand-year-old cultural traditions.

The community’s name means “the place where we hunt snowy owls”. But out on the jumbled sea ice that stretches from town to the horizon, local residents are focused on bowhead whales. Culturally and nutritionally, bowheads are the most important subsistence food species for native residents in this isolated settlement, accessible only by air or by sea during the short summer months when the water is open. Food that is not harvested locally is flown in. A gallon of milk at the AC, the largest grocery store in town, costs $10.

A short walk...Continue reading

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The rising cost of America First

WITH the ink still drying on the Singapore declaration, President Donald Trump was asked why the North Koreans were any likelier to honour its terms than all the previous nuclear agreements they have flouted. The difference, he said, was himself. “I don’t think they’ve ever had the confidence, frankly, in a president that they have right now.” It was a reminder that the only unifying principle in Mr Trump’s maverick foreign policy is his relentless eye for personal advantage.

That is apparent in his North Korea policy more broadly. To use a real-estate analogy: when he was first briefed on the state of North Korea diplomacy by his predecessor, Mr Trump perhaps saw it less as an existential threat than a fixer upper—an opportunity for an easy win. Negotiations had long been frozen over America’s demand that Kim Jong Un’s regime should give up its nuclear arms and the regime’s refusal to do so. Yet there were two ways an America president could shake things up: by promising...Continue reading

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Suicide is born of despair. Suicide prevention is far from hopeless

SUICIDE is often born of despair, but suicide prevention is far from hopeless. What is required is a better understanding of the suicidal brain, says Dan Reidenberg of SAVE, a non-profit organisation. Research suggests that people cannot remain acutely suicidal for much more than an hour, and that half of those who do commit suicide take the final decision less than ten minutes before killing themselves. Yet what goes on in the brain in those minutes remains a mystery. It is one that is worth trying to solve, since a new report from the Centres for Disease Control and Prevention (CDC) shows a sharp spike in suicide across the country (see map).

In practical terms, measures that increase the distance between a suicidal thought and access to lethal means can make a big difference. After the Australian government reduced the country’s stock of guns by around one-fifth through a gun buy-back programme in 1997, the rate of suicide by gunshot dropped by almost 80%. America is unlikely to follow Australia in the near future, but...Continue reading

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A divided Supreme Court strikes a blow for lower election turnouts

Postcard from DC

THE Supreme Court is not comprised of “nine junior varsity politicians”, Justice Stephen Breyer insists. For Chief Justice John Roberts, America’s top jurists are umpires with no skin in the game. With a 5-4 ruling on June 11th in Husted v Philip Randolph Institute, a significant voting-rights case, these paeans to dispassionate nonpartisanship ring a bit hollow. All five justices appointed by Republican presidents voted to uphold an Ohio law disproportionately erasing Democrats from the voter rolls; all four Democratic appointees voted to strike it down.

Politics loom large in the background, but the main opinions in Husted turned on a thorny question of statutory interpretation. When Congress passed the Help America Vote Act (HAVA) in 2002, a follow-up to the National Voter Registration Act (NVRA), what did it mean when it told states not to remove people from registered voter lists...Continue reading

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In praise of ranked-choice voting

“A LIBERAL,” said Robert Frost, an American poet, “is a man too broad-minded to take his own side in a quarrel.” An ad released less than a week before election day by Mark Eves and Betsy Sweet (pictured above), opponents in Maine’s Democratic gubernatorial primary, seemed a paragon of Frostian liberalism. Ms Sweet, who resembles a slightly less caffeinated Elizabeth Warren, urged her supporters to vote for Mr Eves; while Mr Eves asked his supporters to back Ms Sweet. On election day the two gripped and grinned together outside an elementary school in Portland’s lovely West End.

In fact, their alliance was not wet leftism; it was a strategic gambit. On June 12th Maine conducted the first-ever statewide election using ranked-choice voting (RCV), in which voters rank the entire field rather than just voting for a single candidate. Trailing in the polls, Ms Sweet and Mr Eves figured they could boost their chances by campaigning for second-place votes.

RCV has long...Continue reading

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Polio returns to Venezuela, and threatens the region

IN 1961 Venezuela became the first country in Latin America virtually to eliminate malaria, using a combination of DDT, an insecticide, and drugs. The oil-rich country has now made health history again, this time in a bad way. On June 7th Venezuela’s health department reported to the Pan-American Health Organisation (PAHO) the first case of polio in South America since 1991. This is a big worry, not only for Venezuela but for its neighbours. The re-emergence of polio strongly suggests that Venezuela’s vaccination programme has failed. With thousands of Venezuelans a day fleeing the country’s political and economic crisis, there is a risk that polio and other highly infectious diseases will spread to more countries in the region.

It is not clear what the source is of the infection reported to PAHO, which occurred in a child nearly three years old from the Warao indigenous community in the rural state of Delta Amacuro. The child might have been infected by someone who had been to a...Continue reading

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The feisty fog-catchers of Chile

Also available as a beer

IN THE school playground in Los Tomes a lone child, José Ossandón, plays with his emboque, a ball-and-cup game. The eight-year-old is the school’s only pupil. His teacher, Nilda Jimena Gallardo, herself a former pupil, says that enrolment has dropped from 65 when she started teaching 43 years ago. Drought has driven families away, she says. “Only the old remain.”

Los Tomes is an agricultural co-operative, one of 178 in Chile’s Coquimbo region. Nineteen comuneros try to grow wheat and raise sheep and goats on 2,800 hectares (7,000 acres) of semi-arid scrubland. A decade-long drought has made that harder. Hilltop springs where the animals once drank have dried up. As herds shrank and yields fell, farmers’ children moved away to take jobs in cities or at copper mines.

Hope for Los Tomes comes in the form of three 60-square-metre (646-square-foot) nets stretched between poles on a...Continue reading

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Bickering North Americans win the right to host football’s World Cup

WALL building, tariff wars and Twitter-borne insults set the tone for the United States’ relations with Mexico and Canada these days. But, like a bickering family in a photo studio, the three countries managed enough of a show of affection to be granted the right to co-host one of the world’s biggest sporting events. On June 13th FIFA, football’s global governing body, voted to award the 2026 World Cup to the three erstwhile amigos. Their bid, dubbed “United”, beat a rival one from Morocco. “The beautiful game transcends borders and cultures,” said an elated Carlos Cordeiro, president of the United States Soccer Federation.

Under FIFA’s newly transparent voting system, the football associations of more than 200 countries, rather than a committee of FIFA fat cats, had a vote. They backed the North American bid over the Moroccan one by a margin of two to one. United’s infrastructure is mostly built. It promised FIFA $11bn in profit, twice that offered by its...Continue reading

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