Monday, November 28, 2011

Will Europe Save Itself?

This is that time of the semester again when I am drowning in paperwork – yup, marking assignments. Even with today being a public holiday, I must still be up early to toil on the tedious work that is before me. Actually I was grinding away at this laborious task since last week and I know I am supposed to finish everything by Tuesday (yipes, that’s tomorrow!) and after that the exams begin and then, another agonizing round of grading exam scripts. I hate it! Sigh! But there’s nothing I can do about it except to endure.

Yesterday, I referred to the depressing UK public sector situation. This is not just a British thing. It is playing against a worrisome backdrop of ongoing uncertainty that stems from the European sovereign and banking crisis, which it is feared will lead to broader contagion outside Europe and global credit markets.

Canadian Finance Minister Jim Flaherty has warned on Saturday that “citizens in many countries face ‘dire consequences’ without a quick solution, including more social unrest and major tax increases” (Bloomberg, November 26, 2011).

And Australian Treasurer Wayne Swan at the other end of the world complained on Sunday that “European Union leaders must act to stop the region’s debt contagion becoming a ‘slow-motion train wreck’ that is already crimping Australia’s economy”. He claimed that Europe has dragged on global economic growth and cut Australian government revenue, causing asset prices to fall and households to spend less (Bloomberg, November 27, 2011).

And things are only going to deteriorate. On Friday, S&P downgraded Belgium’s credit rating and the beleagured country follows Slovenia, Spain, Italy, Ireland, Portugal, Cyprus and Greece in having their credit rating cut this year. Europe’s leadership must act decisively to save Europe – but will the Europeans find political will in quick time? As The New York Times said on Sunday: “The endgame for Europe is fast approaching”!

Of course, Najib’s Malaysia is living in its own world of make-believe, that everything is hunky-dory and Malaysians have nothing to worry about! If we trust Najib, we can also believe that we are inhabiting on another planet.

In this much-awaited EPL game, Vincent Kompany put Manchester City ahead in the 31st minute with a header but Liverpool equalized just two minutes later after Joleon Lescott deflected a Charlie Adam attempt into his own goal. And so the two teams had to be contented with a 1-1 draw.

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