Good morning, Quartz readers!
What to watch for today
EU gets closer to banking supervision… European finance ministers have come to a deal on a first step towards controlling banks across the euro area. They want to hand direct authority to the European Central Bank to directly police lenders across the euro zone and intervene in smaller banks. Broader surveillance could prevent reckless lenders in individual countries dragging entire economies down, as arguably happened in Ireland and Spain. The onus is now on EU leaders, who meet in Brussels today and tomorrow, to give their full political backing.
…and decides whether to lend Greece just a little bit extra… Greece needs to borrow €1.29 billion ($1.68 billion) more than previously agreed to stage a €31.9 billion bond buy-back that will lighten its debt load. (That’s right, it needs to borrow money so it can unborrow other money; it’s OK, there is a logic to this, somewhere.) EU finance ministers will meet with IMF director Christine Lagarde today to make the final decision.
… and whether to limit the use of carbon credits. Yes, it’s a busy day for Eurocrats! The European Commission may vote to limit the import of carbon credits, which are used to reduce the emission of greenhouse gases. The EU has a surplus of carbon credits, and their price has plummeted, rendering the whole point of the carbon credit scheme (that it should be expensive to pollute) rather, well, pointless.
Air Asia gives Airbus, and British manufacturing, a boost. The Asian budget carrier is expected to announce an order for 100 new planes at Airbus’s facility in Wales today. Its factory at Broughton is the UK’s largest single manufacturing plant.
The Gemenid meteor shower strikes. The Gemenids, one of the two biggest meteor showers of the year, will start with as many as 100 shooting stars an hour. The shower will peak on the morning of Dec. 14.
While you were sleeping
The Fed more than doubled its money-printing. Ben Bernanke, the chairman, announced that the US Federal Reserve will buy another $45 billion in US Treasurys every month, in a program already dubbed “QE4”, on top of the $40 billion of mortgage-backed securities it is already buying (QE3). Though one of the aims of QE (quantitative easing) is to push down unemployment, the Fed this time set an explicit target for the first time, saying it will maintain current policy until joblessness falls to 6.5%. (It’s currently at 7.7%).
OPEC voted to leave its quotas alone. The Middle East-dominated petroleum cartel will continue to produce a maximum of 30 million barrels of oil a day. The decision was based on the group’s endorsement of average oil prices; meanwhile, Saudi Arabia has cut its own oil output to its lowest level in a year to keep those prices steady, in the face of faltering demand. But OPEC is likely to have less and less sway over global prices as new petroleum powers, including Iraq and the United States, exert more influence.
Egypt’s opposition urged a “no” vote. President Mohammed Morsi’s draft constitution goes before voters on Dec. 15, but the opposition coalition, called the National Salvation Front, says its followers should oppose the proposal. The front said it also might boycott the vote.
Syria fired Scud missiles at its opponents. President Bashar al-Assad for the first time fired the gigantic, Soviet-era missiles, which are capable of carrying chemical weapons, at rebel fighters.
India’s government will investigate Walmart. A retired judge will lead an investigation of the retail giant’s lobbying spending in India. The probe is separate from one into whether Walmart violated Indian law banning foreign direct investment. Walmart has denied any wrongdoing
Quartz obsession interlude
Naomi Rovnick on the Hong Kong real estate bubble that the IMF is warning could pop and do some serious damage. “Hong Kong is currently the world’s most expensive place to buy a home. An apartment just sold there for $60 million. The city’s property market is notoriously volatile. Booms and busts are frequent. Locals in the Chinese city often trade apartments as frequently as Americans would trade shares.” Read more here.
Matters of debate
The EU cannot police the EU. Its member states are too big and too different. They need to avoid faulty policies themselves to avert future crises.
Sri Lanka is still not stable. Three years after the Tamil Tigers’ defeat, issues that caused the country’s civil war are once again coming to a head.
Finland needs to work out how to deal with Nokia’s decline. Luckily the country is home to a dynamic start-up scene.
ExxonMobil is less sure that electric cars belong among all the other losers. Last year, the oil company had electric cars and plug-in hybrids in the miscellaneous category of way-out vehicles with a niche market. In its latest 2040 forecast, though, Exxon gives electrics a category all their own.
The BRIC companies with the worst reputations. A group calling itself RepRisk has produced an index that ranks companies according to the local perception of their behavior in certain countries. Natural-resources firms score particularly badly, with Russia’s Gazprom and Brazil’s Vale leading the charge. No surprise there.
Stop comparing QE to the Roman Empire’s debasement of silver. Roman Emperor Diocletian really was not as financially imprudent as today’s economists say. And his debasement of silver did not cause the fall of the Roman Empire. So popular warnings that Bernanke should learn from Roman history are probably inaccurate.
Perhaps home remedies are not so primitive? For decades, western pharmaceutical companies have tut-tutted the use of home remedies as unwise and even barbaric. Now, though, a need to find new revenue has some of them researching traditional medicine in China.
Surprising discoveries
Asians change their trade routes. A historic shift is taking place in trade routes. The highly trafficked route from Asia to Europe and back is much less used, and is being supplanted by an Asia-to-North America axis.
Afghanistan is still leaking billions of dollars in cash. US officials last year installed bulk counting machines at Kabul Airport to stem the smuggling, but they haven’t been connected to the internet or set up to keep track of bills, and VIP travelers aren’t even being checked.
In 1087, the “alcohol only” plan was a fad diet recommended for royalty. People have also been trying low-carbohydrate diets since 1864.
There is a shortage of British 90-somethings. Britain has lost some 30,000 nonagenarians, and that is too many, according to actuaries. So where are they?
There is also a shortage of finless porpoises in the Yangtze River. Chinese researchers say there are now a little more than half of the 1,800 cute, dolphin-like creatures that were counted in 2006. And no, it’s not because they’re being eaten.
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