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Friday, 24 May 2013

BREAKINGVIEWS

Global inflation slide stirs the bogeyman

24 May 2013

In theory, inflation should have picked up when central banks cranked up the printing presses. Instead, it’s slowing down. In the U.S., it’s nearly 1 percentage point below target. Policymakers now have to start worrying about their worst enemy – deflation.

A.G. Lafley, Proctoer & Gamble, P&G, pharma, healthcare

A.G. Lafley will be more proctor than gamble

24 May 2013

Bringing back the former P&G boss won’t ensure the Pampers-to-Scope giant reclaims former glory. His last decision – of a successor – flopped. But unlike the turnaround facing J.C. Penney’s returning ex-CEO, Lafley’s job is somewhat simpler: oversee cost cuts and brand building.

A woman speaks on her mobile phone next to an ATM of Spain's lender bank Bankia in Madrid

Spanish banks get spruced up for banking union

24 May 2013

The Bank of Spain says the country’s lenders face up to 10 bln euros of new provisions against ropey restructured loans. They may not need extra euro zone capital, but it will make them better placed to pass rigorous stress tests before they get supervised by the ECB.

A girl holds a U.S. and Chinese flag

China-U.S. audit truce wisely avoids big issues

24 May 2013

Auditors in China can no longer claim that “state secrets” prohibit disclosure to the U.S. watchdog. That should keep Chinese companies from being banned in U.S. markets. There are open questions about sovereignty and state capitalism, but those are fights for another day.

The logo of Gazprom

Yamal LNG set to inflict pain on Gazprom

24 May 2013

A gas project in Russia’s far north could crack the state giant’s export monopoly. The Kremlin is expected to decide soon whether to allow Yamal LNG’s backers to ship its production abroad. It may only approve sales to Asia. But even limited exports would hurt Gazprom.

Frackers ignore German beer angst at their peril

24 May 2013

Germany’s brewers want to make fracking verboten. In the U.S., the gas drilling technique’s economic benefits trump environmental concerns. Whether it’s the British countryside or German lager, threats to cultural touchstones will hold back a similar boom in Europe.

A passenger plane flies under clouds after taking off from Sydney's Kingsford Smith airport October

Microsoft stages nebulous Chinese comeback

24 May 2013

The software titan has for years been stuck in a piracy trap in China - many use its products, and few pay. Cloud-based services like Windows Azure are less prone to misuse. This time there are new problems: fierce competition, and politicians that favour domestic rivals.

Bayern Munich's Pizarro celebrates goal during German DFB Cup soccer match

Soccer success mirrors Germany's secret strengths

24 May 2013

For the first time ever, both teams in Europe’s biggest championship will be German. In 2000, the country was the sick man of the pitch. The sport’s resurgence, like the economic renaissance, relied on the social market economy and the ability to push through structural reforms.

Bank governance stigma can be fixed lickety-split

23 May 2013

It’s easy to see how Jamie Dimon would consider an independent chairman at JPMorgan a demotion for him. If peers like Lloyd Blankfein hold both top jobs, CEOs only may feel like second-class citizens. U.S. financial regulators could turn the division of labor into a virtue.

BREAKINGVIEWS TV ON INSIDER

Features

Daniel Indiviglio

U.S. mortgage dysfunction demands action, not talk

22 May 2013

Uncle Sam’s seizing of Fannie Mae and Freddie Mac in 2008 marked one more failure in a sorry decades-long history. Their misdeeds ranged from strong-arming politicians to cooking the books. They shouldn’t now get a pass just because their profits are again helping Washington.

Neil Unmack, Columnist, Breakingviews

Securitisation may have found a way to rehab

21 May 2013

Can one crisis solve another? Securitisation could help small companies. That slicing and dicing of credit risk also caused the last credit boom. Getting it moving fast would require support from the ECB and governments, and the belief that past mistakes won’t be repeated.

Columns

Edward Hadas, Economics Editor

Edward Hadas: Apple, hypocrisy and stakeholder tax

22 May 2013

Politicians are hypocrites when they complain about the cross-border tax strategies of Apple and other multinationals. But “hypocrisy is the tribute vice pays to virtue”. It’s high time that companies admit taxes on profit are fair payments for the help that governments give them.

Andy Mukherjee

India in depth: A costly flirtation with “linkers”

21 May 2013

Inflation-linked bonds will give gold-addled savers a safer investment option. But limited initial issuance means New Delhi will have to pay up to lure investors until the securities become more liquid. A bolder commitment to the new asset class can save the government money.