I am interested in the Egyptian elections. The Muslim Brotherhood got 25% of the electoral vote. Approximately 43% turned out of 50 million eligible voters. They are in a run off now with Shafiq, the technocrat from the old regime. It is now up to the Brotherhood to create a coalition with the liberals to win the elections. This means some kind of accommodation with the USA and Israel. That is the behind the scenes factor that is left unstated. Shibley Telhami speaking on CSPAN says that the Egyptian public is concerned about the American policy regarding Israel and Palestine and although they had high hopes for Obama in 2009, they are now disillusioned with him and consider him to be a typical pro-Israel American president.
This from Financial Times
May 27, 2012 8:40 pm
Egyptian liberals have chance to be kingmakers
By Borzou Daragahi and Heba Saleh in Cairo
Egypt’s secular revolutionaries lost out in last week’s presidential elections but find themselves in the novel position of kingmakers as the country heads toward a run-off pitting an avowed Islamist against a member of the former regime.
With neither of the two first-round winners able to muster more than a quarter of the vote, the 50 per cent of electors who supported other candidates, as well as the majority of registered voters who stayed home, have assumed greater importance in the run-off on June 16-17.
Supporters of losing candidates Hamdeen Sabahi, Abdel Moneim Aboul Fotouh and Amr Moussa are regrouping after losing out to the organisational might of the Muslim Brotherhood’s Mohamed Morsi and the law-and-order candidacy of Ahmed Shafiq, a minister in the Mubarak era, in the first round of the presidential vote.
Mr Sabbahi and Mr Aboul Fotouh, who came third and fourth respectively, have challenged the election results, alleging fraud.
Bradley Manning court marshal
From the Guardian
Bradley Manning defence team says US military is withholding key evidence
Military’s delay in searching through files and handing them over is denying Manning a fair trial, defence attorney argues
Ed Pilkington in New York
guardian.co.uk, Sunday 27 May 2012 13.47 EDT
Bradley Manning, the soldier accused of being behind the biggest leak of state secrets in US history, is being denied a fair trial because the army is withholding from him crucial information that might prove his innocence or reduce his sentence, his defence team is arguing.
With Manning’s court-martial approaching in September, his legal team has released details of what they claim is a shocking lack of diligence on the part of the military prosecutors in affording him his basic constitutional rights.
The stakes are high, with Manning facing possible life imprisonment for a raft of charges that include “aiding the enemy”.
Manning’s main civilian lawyer, David Coombs, has filed a motion with the military court in Fort Meade, Maryland, that sets out a catalogue of delays and inconsistencies in the army’s handling of the case.
In particular, he claims the government has failed to disclose key evidence that could help Manning defend himself against the charges.
Almost two years after Manning was arrested, the military has not yet completed a search even of its own files to see if there is any material beneficial to the defence – as it is legally obliged to do.
Euro-crisis continues to destabilize world economy. As Greece goes so goes Spain? The Euro may be reduced to the surplus states unless the EU develops a transfer system like the one that exists in the United States.
From Live Trading News
May 27, 2012 — Updated May 28, 2012 00:23 HKT
EuroCrisis: Run on Banks Expected in Europe
Keep your money in your pockets this week as we expect to see a substantial run on Banks in Europe. The inability of politicians to address in any real way the troubles created in Europe is approaching the end game according to Economist Shayne Heffernan.
The Euro STOXX volatility index has shot up more than 100 percent since mid-March when concern Spain might not be able to meet the disastrous austerity targets, Greece failed to form a Government and the political circus continued.
Next we will see investors, corporations and institutions take the prudent step of cutting exposure to Europe, pulling out funds at a record rate and bringing Europe’s banks to the brink of collapse.
With more than $1.2 trillion in Spanish, Portuguese, Italian, and Irish debt, Europe’s lenders now face a serious deposit flight risk and rising defaults elsewhere in the Euro Markets.
If Greece return to the drachma, its currency probably would suffer an immediate devaluation of as much as 75 percent against the euro, spurring widespread defaults on foreign loans.
The Euro itself is valued at only 80 should there be a continued pattern of default.
Banks in Greece, Ireland, Italy, Portugal, and Spain saw a decline of €81 billion ($103 billion), or 3.2 percent, in household and corporate deposits in the 15 months through March, according to the European Central Bank. On March 30, Greece had €160 billion of bank deposits, down almost €75 billion from the peak in 2009, central bank data show. Lenders in Germany and France saw an increase in deposits of €217 billion, or 6.3 percent, in the same period.
The rate of funds leaving Europe is accelerating as Merkel pushes on with the austerity measures that benefit Germany at the expense of other nations in Europe.
As the EuroCrisis continues, several possible outcomes have emerged according to Economist Shayne Heffernan.
1. Europe finds the money for a real bail out of Greece, Spain, Italy, Portugal, for now this seems unlikely.
2. Greece leads the mass exit of the Euro and will be followed by Spain, Italy, Portugal and possibly others, this is now a real possibility and would allow for these countries to devalue their own currency and manage an exit from recession.
3. The Euro gets devalued, either by the Banks or by the ECB, a real value on the Euro post Greek default is around 80c according to estimates from LTN www.livetradingnews.com Asia’s leading economic research house.
Regardless of which outcome results from the muddled mess the Euro Politicians created the only real interest the rest of the world has is the deleveraging of Euro Banks.
Based on estimations from Shayne Heffernan the maximum result of Europeans selling off their assets is an 8% fall in the US markets that would be short lived.
Former Greek prime minister Lucas Papademos warned Greece may run out of money by the end of June if international bailout funds are cut off following next month’s election, a newspaper reported Sunday.
“From late June onwards, the ability of the government to fund its obligations fully depends on the approval of the subsequent installments of loans from the EFSF and the IMF,” To Vima newspaper quoted Papademos as saying in a leaked memo.
“The available funds in the Greek government will be reduced gradually from about 3.8 billion euros on May 11 to about 700 million euros on June 18 and from June 20 will enter negative territory at the level of around one billion euros.”
Center-left To Vima said Papademos made the warning in a memo to President Carolos Papoulias dated May 11 that was then circulated to party leaders as they tried to form a coalition after an inconclusive May 6 vote.
Greece in 2010 committed itself to a reform program in return for hundreds of billions of euros (dollars) in bailout funds from the European Union bailout fund EFSF and the International Monetary Fund.
That’s about all I have to say except to keep an eye on China.
From the Economist
China in your hand
May 25th 2012, 13:10 by The Economist online
A brief guide to why China grows so fast
OUTSIDE China, people tend to assume that the country’s impressive economic growth is due to exports. As the chart below, drawn from our special report on China’s economy, shows, this notion has always been exaggerated and is now plain false. China grows thanks to high levels of investment—far higher than those seen in previous Asian miracles such as South Korea and Japan. The corollary of this is low levels of private consumption. Some argue that this must lead to imbalances that one day will send China’s economy off a cliff. We disagree.