China can ride out this crisis, but we are on course for another; Protests, clashes in India for job reservations; Art as a country’s heartbeat

1 China can ride out this crisis, but we are on course for another (Seumas Milne in The Guardian) Seven years after the collapse of Lehman Brothers brought down the global financial system and plunged half the world into a slump, it’s scarcely alarmist to see the financial panic as the harbinger of a new crisis in a still crippled world economy.

The market gyrations that followed “Black Monday” this week and the 40% drop in the value of Chinese stocks since June have only underlined the fragility of what is supposed to be an international recovery. After three decades of deregulation punctuated by financial crises and a systemic meltdown, there is every reason to fear more fallout from casino capitalism.

Financial markets pumped up with credit and quantitative easing to keep the real economy afloat are in any case ripe for a crash – or “correction”, as the market players like to call it. The only question is how far and fast they go – and how great is the price paid by the rest of us.

Paradoxically, Beijing may be better placed than others to ride out this storm. China’s economy is slowing down, as it shifts from export-led growth to consumption. But it’s still growing at 7%, nearly three times as fast as Britain and the US, which are supposed to be the west’s current star performers.

China rode out the 2008 crash by pumping public investment into the economy, delivering 78% growth between 2007 and 2014, while the US managed 8%. That has left it with a huge debt pile, estimated at 282% of national income, which some now believe will bring China’s economy to a juddering halt. But that is mostly debt between state-owned institutions, so there is no basis for a speculative Lehmans-type collapse.

A dysfunctional model of capitalism, built on deregulation, privatisation and low wages, crashed and burned seven years ago. But the fallout from that crisis is still ricocheting around the world. Any idea that the western economies that generated stagnation have been fixed is not serious. Their recoveries have been the slowest on record and interest rates remain at a historic low – because owners of capital are prepared to invest in anything except the productive economy.

The likelihood must be that this stagnation continues indefinitely, punctuated by financial upheavals. Without far-reaching change in economic policy, they can be expected to trigger crises that will tip western economies, and others, back into full-blown recession.

3 Protests, clashes in India for job reservations (San Francisco Chronicle) Clashes erupted overnight between police and members of a farming caste demanding government benefits in western India’s Gujarat state. Authorities sent paramilitary forces to help restore order Wednesday, as the group’s leader called for a strike.

On Tuesday, Patel leaders led a rally attended by 500,000 Patels from across Gujarat. Later, police detained the group’s 22-year-old firebrand leader Hardik Patel, prompting members of the community to rampage through cities in Gujarat.

The Patidars, also known as the Patel community for the last name they share, are demanding the special status given to many minorities in India, guaranteeing them a share of government jobs and school places. The Patels, which make up about 20 percent of Gujarat’s 63 million population, say their livelihoods based on seasonal farming and small industry have become increasingly difficult amid India’s agricultural malaise and rapid economic growth marked by high inflation.

India’s constitution sets out affirmative action, called reservations, for India’s lowest Dalit and untouchable castes to help them overcome centuries of discrimination. That has been expanded over the years to include several other relatively disadvantaged low caste groups.

Because reservations allow easier access to government jobs, schools and universities, they’ve become a huge political bargaining chip in this country of 1.2 billion, and over the last decade several groups have led violent protests to demand that they be counted at the bottom of the country’s complex caste system.

3 Art as a country’s heartbeat (Leonie Wagner & Gabe Mbele in Johannesburg Times) If South Africa is flat-lining, then arts and culture are the defibrillator. This is according to some artists at the launch of the Department of Arts and Culture’s Living Legends Legacy Project, which is intended to promote cultural development through mentorship and master classes.

Minister Nathi Mthethwa has pledged R5-million as an initial investment. Veterans such as Joe Mafela, Abigail Kubeka, Don Mattera, Caiphus Semenya and Thandi Klaasen will run master classes and mentor up-and-coming artists.

Director and playwright John Kani and musician Simphiwe Dana said more funding was needed. Kani said that the lack of funding was a reflection of the government’s attitude to the arts. “It makes me angry that arts and culture are not [on the government’s] agenda. We’ve lost our humanity because we are so focused on maths, science and engineering. Ubuntu was not found in science, it’s in the arts.

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Asia stock sell-off continues; China 2015: Beware the links with 1929; Indian, Muslim and female

1 Asia stock sell-off continues (BBC) Asian shares have opened lower again as concerns over China’s slowing growth continue to haunt investors. Chinese mainland shares have fallen more 16% since the beginning of the week, sending shockwaves through global markets.

The fall came despite Beijing’s latest efforts to boost growth and reassure traders by cutting interest rates. The People’s Bank of China cut its key lending rate by 0.25 percentage points to 4.6% in an effort to calm stock markets after two days of turmoil. It is the fifth interest rate cut since November last year.

The Nikkei’s fall on Wednesday added to an already painful week for the Tokyo index which has already shed more than 8% so far. Elsewhere in Asia, investors were equally hesitant sending Australia’s S&P/ASX 200 down by 0.5% to 5,109.90 while South Korea’s Kospi index was flat.

Overnight, European and US markets saw another session of volatile trading. Wall Street’s Dow Jones closed 1.3% down, marking the sixth consecutive day of falls for US stocks. London’s FTSE 100 index closed up 3%. Major markets in France and Germany both gained more than 4%.

2 China 2015: Beware the links with 1929 (Larry Elliott in The Guardian) On day one the stock market fell by 13%. On day two it fell by a further 12%. On day three hopes were high the storm had blown over after equity prices recouped the previous session’s losses. Let this be a cautionary tale. These figures relate not to the Shanghai Composite index in August 2015 but the Dow Jones Industrial Average in October 1929.

Even in the most savage bear markets prices never fall in a straight line. Instead, within a downward trend big daily falls are punctuated by sizeable daily rallies. Events of the past few days conform to this pattern, at least in Europe. Shares in London, Frankfurt and Paris fell heavily on Friday and Monday, then recovered on Tuesday.

For a good while, there was every indication that New York would follow the same pattern. The Dow Jones Industrial Average was up more than 400 points at one stage only to suffer a bout of jitters in the last hour of trading to close more than 200 points lower.

This is a bad omen. Markets were not over-impressed when China hit the panic button by both cutting interest rates and allowing banks to lend more money. Wall Street’s late loss of nerve suggests there is a lot more turbulence to come, with attention firmly focused on China. It is not just that the growth rate of the world’s second biggest economy is faltering, it is that the quality of that growth is deteriorating.

Mike Riddell of M&G notes that the share of gross domestic product accounted for by investment rose from just over 40% in 2007, to 48% between 2008 and 2013, to 54% last year. A higher investment rate is normally associated with higher growth; in China’s case it has been associated with lower growth.

Riddell’s conclusion is that much of the investment has been wasteful and that China is “trying to hit unsustainably high GDP growth rates by generating bigger and bigger credit and investment bubbles”.

3 Indian, Muslim and female (Rafia Zakaria in Dawn) Amid all the hubbub over talks between India and Pakistan, news emerged last week about a survey done by the Indian Muslim women’s rights organisation Bharatiya Muslim Mahila Andolan (BMMA). The survey revealed that over 90pc of Indian Muslim women surveyed want a ban on polygamy, oral talaq (divorce) and child marriage.

The results of the survey have since spurred a debate regarding the need for the reform of personal status laws that currently govern marriage and divorce for Indian Muslim women. Like so much else that ails the contemporary subcontinent, the personal status laws originated in the British era.

Under the veneer of their attempts at equal treatment, the British ensured that Hindus and Muslims, now governed by the laws that they had codified, would, in the years to come, begin to believe that religious difference was something crucial, never to be transcended. The Indian Muslim woman living in the now, however, cannot sate herself with the colonial origins of inhabiting the uncomfortable position of being a minority within a minority.

Surveys like the one produced by BMMA reveal the depth of the conundrum they face. The complexity of the situation should not, however, deter Indian Muslim women from either action or advocacy. Indian Muslims have the opportunity to lead change from within, championing the empowerment of their own women without state intervention.

The point is simple: If Indian Muslims — like British Muslims or American Muslims — dislike state intervention in matters of religious law, they must create and enact processes that promote the empowerment of Muslim women within their communities.

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Market panic shows what happens when stimulants wear off; The great fall of China explained; Rival Koreas find a way out of disaster

1 Market panic shows what happens when stimulants wear off (Larry Elliott in The Guardian) Financial markets have gone cold turkey. For the past seven years, they have been given regular doses of strong and dangerous narcotics. The threat that the drugs will no longer be available has resulted in severe withdrawal symptoms.

Unlike in 2007, the crash could be seen coming. But this is about more than China. Financial markets in the west have been booming for the past six years at a time when the real economy has been struggling. Recovery from the last recession has been patchy and weak by historical standards, but that has not prevented a bull market in equities.

The reason for this is simple: the markets have been pumped full of stimulants in the form of quantitative easing, the money creation programmes adopted by central banks as a response to the last crisis.

On the day that QE was launched in the UK, 9 March 2009, the FTSE 100 stood at 3542 points. Its recent peak on 27 April this year was 7103 points, a gain of 100.5%. There is a similar correlation between the three rounds of QE in the US and the performance of the S&P 500, which was up more than 200% during the same period.

But there were always doubts about what might happen when central banks decided it was time to remove some of the stimulus they have been providing for the past seven years. Now we know. The Federal Reserve and the Bank of England halted their QE programmes and started to muse publicly about the timing of the first increase in interest rates.

At that point, financial markets merely needed a trigger for a big selloff. China has provided that, because the world’s second biggest economy has shown distinct signs of slowing. What was inevitably dubbed “Black Monday” began in east Asia where there was disappointment that Beijing did not provide fresh support for shares in Shanghai overnight.

But, unlike in 2008, interest rates are already zero. Budget deficits mean governments have less scope to cut taxes or raise spending. China’s total debt is four times what it was seven years ago. Central banks have pulled all the conventional policy levers and a few unconventional ones as well. They could shelve plans for interest rate rises and contemplate further rounds of QE, even though that amounts to doubling the dosage for drugs that become less effective every time they are administered.

2 The great fall of China explained (Gulf News) Although China, a major engine of global growth, has been slowing for some time, financial markets have nevertheless tumbled over fears its economic growth will decelerate faster than expected. Here are a series of answers to key questions on the Chinese stock market and the wider economy:

What has China done to try to stop shares falling? China rolled out a range of measures last month after Shanghai stocks slumped more than 30 per cent from their mid-June peak. In the early July moves, the government intervened with a rescue package that included funding the state-backed China Securities Finance Corp (CSF) to buy stocks on behalf of the government. Other measures include barring “big” investors from selling their stakes and cracking down on short-selling — when investors bet prices will go lower.

Where next for China’s stock market and currency? Despite the government’s “national team” having made a major effort to support the market, analysts say shares are likely to go still lower as the plunge in global bourses is blowing back on China in what is effectively a vicious circle. The yuan is widely expected to weaken further against the US dollar, although the central bank is expected to intervene to prevent steep slides.

Why are financial markets so gloomy about the Chinese economy? China’s economy expanded 7.4 per cent last year, its weakest since 1990, and growth has slowed further this year, measuring 7.0 per cent in each of the first two quarters. It is a far faster growth rate than most other major countries, but the yuan move raised suspicions that the state of the economy is worse than officials have revealed.

Why is slowing growth such a problem domestically? Experts say China’s ruling Communist Party needs to deliver improved living standards, lifting more people out of poverty and satisfying the growing middle class, in exchange for acceptance of its rule. The government also needs to maintain a minimum level of economic growth, which some analysts put at seven percent, in order to create jobs for millions of people and prevent social unrest.

Why is slowing growth a problem internationally? With Europe’s economy weak and the US preparing to raise interest rates, the world has looked to China’s thirst for raw materials to keep finances humming. With more than 1.3 billion potential consumers, the country is also a big market for manufactured goods such as cars. Any weakness in demand could be keenly felt by producers.

2 Rival Koreas find a way out of disaster (San Francisco Chronicle) After 40-plus-hours of talks, North and South Korea on Tuesday pulled back from the brink with an accord that allows both sides to save face and, for the moment, avert the bloodshed they’ve been threatening each other with for weeks.

In a carefully crafted, though vague, piece of diplomacy, Pyongyang expressed “regret” that two South Korean soldiers were maimed in a recent land mine blast Seoul blamed on the North. While not an acknowledgement of responsibility, let alone the “definite apology” South Korea’s president had demanded, it allows Seoul to claim some measure of victory in holding the North to account.

South Korea, for its part, agreed to halt anti-Pyongyang propaganda broadcasts on the border, which will let the authoritarian North trumpet to its people a propaganda win over its bitter rival — and put an end to hated loudspeaker messages that outside analysts say could demoralize front-line troops and inspire them to defect.

The agreement marks a good first step in easing animosity that has built since South Korea blamed North Korea for the mine explosion at the border earlier this month and restarted the propaganda broadcasts in retaliation. But, as always on the Korean Peninsula, it’s unclear how long the good mood will continue.

The Koreas also struck an important humanitarian agreement by promising to resume in September the emotional reunions of families separated by the Korean War. They said more reunions would follow, but there were no immediate details.

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North Sea oil revenues fall by over 75%; Airbnb gives Paris luxury hoteliers a fright; What black and white people think about one another

1 North Sea oil revenues fall by over 75% (BBC) North Sea oil revenues in the first three months of 2015 were down 75% on the previous quarter, the Scottish Conservatives have said. The Scottish government’s quarterly national accounts show that the amount received in tax receipts between January and March was £168m. This was down from £742m oil revenues in the final three months of 2014.

Finance Minister John Swinney said oil was a bonus – not the basis of the economy. The Scottish Conservatives said the figures for Scotland’s geographical share of oil revenues, which they claimed were “buried” in a table in a report, showed “how wildly wrong” the SNP’s pre-referendum calculations had been.

The Tories said the figures also further demonstrated the case against full fiscal autonomy for Scotland – an SNP policy. In its oil and gas bulletin published in May 2014, the Scottish government estimated that oil revenues would be between £15.8bn and £38.7bn between 2014/15 and 2018/19.

It latest bulletin, published in June this year, said revenues could be as low as £2.4bn for 2016/17 to 2019/20, with it highest estimate at £10.8bn, based on a best-case scenario of the oil price returning to 100 US dollars per barrel.

2 Airbnb gives Paris luxury hoteliers a fright (Gulf News) Nowhere in the world has more accommodation available on Airbnb than Paris. Now the home-sharing website that has transformed budget travel to the French capital is giving its super-deluxe hotels a fright too.

“The Paris market is going to get very difficult,” said Didier le Calvez, managing director of The Bristol Hotel. Along with bosses of the city’s other “palaces”, he denounces Airbnb as a menace that enjoys an unfair advantage. A trawl of the Paris region’s 50,000 Airbnb offerings — there were only 7,000 across the whole of France in 2012 -suggests le Calvez and his colleagues have reason to worry.

Airbnb offers between 380 and 400 Paris properties at over 500 euros a night. Of those, about 40 charge over 1,000 euros ($1,090). Add in the attraction of individuality, anonymity and in some cases extra beds, and that puts them potentially in competition with the 1,000 euro a night Bristol and half a dozen other high-end Paris hotels, which have about 1,500 rooms to offer in total.

The Paris luxury sector is already worried about a surge in competition from newly opening hotels. Consultants JLL Hotels & Hospitality reckon that capacity will be 60 per cent greater in 2018 than a decade earlier. A downturn in visits from wealthy Russians and Brazilians as the economies there falter, and fears among US visitors of rising anti-semitism in France, are also a factor.

2 What black and white people think about one another (Hugh Muir in The Guardian) There is a degree of truth-telling going on. The film Dear White People, released in the UK in July, is a satirical look at the situation of black students at a predominantly white Ivy League universities. Americans do a good trade in discussing cultural idiosyncrasies. Such humour works less well in the UK. Yet, it is the contention of my friend Dotun Adebayo – broadcaster and columnist – that such trading on stereotypes happens in the UK in private, and he set out to prove it.

He presented two programmes this month on BBC Radio London, one on what white folks really think about black people, and the other on what black people really think about white people. The four white Britons he invited into the studio for the first programme said, without rancour, that they found black people loud, excessively feisty, excessively ebullient and oversensitive.

Sample complaints: “When someone calls me ‘white trash’, I don’t get upset. Why do black people have to take a diss so personally?” and “Why has everything got to get an ‘Is it because I’m black?’ response?” This suggests that those who took part in the experiment had been exposed to a good few stereotypes, and principally very negative ones. The lack of frankness between the races about each other is more a white problem, said one, “because black people know more about us than we know about them”.

The following week, four black guests cheerily questioned why their white friends dress down while black people dress up, but – more seriously – cited an enduring reluctance to discuss what they saw as a core issue: majority mindsets conditioned still by the imposition of enslavement and colonialism. “They felt that for all the conversations white and black people have, they never truly deal with that. They saw it as the elephant in the room,” says Adebayo.

It wasn’t all just stereotypes, he says. There was a genuine acceptance among his white guests that black Britons get a raw deal, but although they felt part of an equation that caused them real concern, they felt impotent in terms of doing anything about it. Hence, perhaps, some of the frustrations and resentments expressed in private. Guilt and impotence never was a good mix.

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How slowdown could spread to Brics and beyond; PC sales slide hits HP; Five motivations for entrepreneurship

1 How slowdown could spread to Brics and beyond (Larry Elliott & Phillip Inman in The Guardian) Financial markets ended last week in panic mode as fears emerged that the world was about to enter the next phase of the crisis that began eight years ago in August 2007. Back then, the problems began in the developed world – in American and European banks – and spread to the rest of the world. The bigger emerging markets – China and India most notably – recovered quickly and acted as the locomotive for global growth while the west was struggling.

There was talk of how the future would be dominated by the five Brics countries – Brazil, Russia, India, China and South Africa – and by 11 more emerging market economies, including Turkey, Indonesia, Mexico and Nigeria. That has happened. Emerging market countries are dominating the news – but for all the wrong reasons. And because, after years of rapid growth, they now account for a bigger slice of the global economy, a crisis would have more serious ramifications than in the past.

Emerging markets have a habit of causing trouble. For a quarter of a century after the Latin American debt crisis erupted in Mexico in 1982, the story was of a storm moving from the periphery of the global economy towards its core, the advanced nations that make up the G7. Mexico ran into fresh problems in 1994, there was an Asian debt crisis in 1997, and a Russian default in 1998 before the dotcom bubble burst in 2001. That proved to be a dress rehearsal for the near meltdown of the global financial system in 2007-08.

Now the focus is back squarely on emerging markets. The problem is a relatively simple one. In the post-Great Recession world, the tendency has been for all countries to try to export their way out of trouble. But this model works only if the exports can find a home, as they did when China was growing at double-digit rates.

But in the past 18 months, the Chinese economy has slowed, causing problems for two distinct groups of emerging market economies – the east Asian countries that sell components and finished goods to their big neighbour, and countries that supply China with the fuel and raw materials to keep its industrial machine going.

China’s slowdown and the devaluation of the yuan will also have an effect on two other groups of Asian countries. Low-cost manufacturers, such as Vietnam, will eventually find it harder to compete, and more advanced economies – including South Korea and Taiwan, which provide components to Chinese manufacturers – will see demand for their exports decline.

2 PC sales slide hits HP (BBC) Technology giant Hewlett-Packard has reported falling profits and revenues as sales of personal computers fall. For the three months to 31 July, HP said net income fell to $854m down from $985m a year earlier.

Total revenue fell 8.1% to $25.35bn, with revenues at HP’s personal computer and printer business down 11.5%. Later this year, HP is due to split into two, separating its computer and printer business from its corporate hardware and services operations. The split is part of a radical restructuring plan, which has already resulted in tens of thousands of job cuts in recent years.

Revenues at HP’s personal computer business were down 13%, with revenues from sales to consumers down 22%. HP also gave a full-year profit forecast that was largely below what analysts had expected.

3 Five motivations for entrepreneurship (Larry Alton in San Francisco Chronicle) Why would anybody want to go through with the ordeals of entrepreneurship? It’s because, despite the hardships of the experience, there are nuggets of joy and satisfaction that can be derived from it and, at the end of the tunnel, if you’re committed enough, is a substantial reward. There are five main motivations that drive most entrepreneurs:

A. Money. You can deny it all you want, but the vast majority of entrepreneurs get into the game at least partially because of the potential to make lots and lots of money. There’s nothing wrong with pursuing money, but if the allure of wealth is the only thing driving you, you risk becoming frustrated if you don’t turn a profit in the first few years.

B. Flexibility. Some entrepreneurs venture out on their own because they’re tired of the demands of traditional work. Just be aware that entrepreneurship is extremely demanding, especially in the early stages of growth, so working your own hours doesn’t always mean working fewer hours or working under less stress. In fact, many people find that they work harder, longer, and under tighter constraints as entrepreneurs than they did as workers — but it’s still rewarding.

C. Control. The desire for control drives many entrepreneurs who aspire to attain a leadership position. When you’re the boss of your own organization, you’ll get to call all the shots, from who gets hired and at what salary to what new strategic directions your business heads down.

D. Teamwork. Some people love working with others. They like the atmosphere of team-based creative problem solving, the interactions between mutually respectful, intelligent people, and the thrill of succeeding together. As an independent entrepreneur, you’ll choose your strategic partners, your mentors, your core team and even your first round of subsequent employee hires. That means you’ll get to pick the skill sets, talents and personalities you want to work with, and you’ll never have to worry about working on a team that you don’t like or can’t be productive with.

E. Legacy. Some entrepreneurs aren’t in it for the money or the experience as much as they’re in it for a lasting legacy. They might want to become the face of a brand and earn a taste of fame along the way. They might want to leave behind something that appreciates them.

Hopefully, you’re motivated by more than one of them—the more driven you are, the less intimidated you’re going to be when the inevitable challenges pop up along your journey. Before you dive into the world of entrepreneurship, think carefully about what it is, exactly, that you want out of the experience. Understand your own motivations before you get involved; you’ll find yourself more satisfied in the long run.

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China worries script worst week for markets in years; Fears of a 1997 repeat in Asia; A $870bn fund learns to use its clout

1 China worries lead to worst week for markets in years (San Francisco Chronicle) Growing concerns about a slowdown in China shook markets around the world on Friday, driving the US stock market to its biggest drop in nearly four years.

The rout started in Asia and quickly spread to Europe, battering major markets in Germany and France. In the US, the selling started early and never let up. Investors ditched beaten-down oil companies, as well as Netflix, Apple and other technology darlings. Oil plunged below $40 for the first time since the financial crisis, and government bonds rallied as investors raced into hiding spots.

“Investors are wondering if growth isn’t coming from the US or China, where is it going to come from?” said Tim Courtney, chief investment officer of Exencial Wealth Advisors. “This is about growth.”

By the time it was over, the Standard and Poor’s 500 index had lost 5.8 percent for the week, its worst weekly slump since 2011. That leaves the main benchmark for US investments 7.7 percent below its all-time high — within shooting range of what traders call a “correction,” a 10 percent drop from a peak. The Dow Jones industrial average fell 530.94 points, or 3.1 percent, to 16,459.75. That’s 10 percent off its high, a correction.

For all the markets’ jitters, many economists say they remain confident that the US economy is resilient enough to withstand a slowdown in the developing world. And Europe’s economy appears to be emerging from its long slump.

2 Fears of a 1997 repeat in Asia (Karishma Vaswani & Robert Peston on BBC) Emerging markets’ currencies tumbling to near record lows. Millions of dollars’ worth of foreign funds pulled out of stock markets in the region. And some investors around the world fearing a major financial meltdown. It certainly feels like we’ve been here before.

Many in Asia’s financial circles are calling this a re-run of the 1997-1998 Asian financial crisis. The meltdown in Asia was set off when Thailand floated the baht in 1997, setting off a domino effect in the region where one by one, currencies fell against the US dollar. Today, many are worried that China’s devaluation last week could set off a similar trend.

Emerging markets are in a far stronger position than they were back in 1997-98. They have stronger current account balances, higher foreign exchange reserves and mostly floating as opposed to fixed exchange rates – which means they don’t have to be defended from speculative attacks.

The other factor to consider is India’s economy – it now claims higher growth than China’s (although many analysts have questioned how those figures have been calculated) and its stock exchange – the Sensex – has seen record inflows in the last six months, attracting investors who have fled from the volatility in Chinese shares.

So it could provide an alternative engine for global growth, if the government’s figures are to be believed. So that’s all good news – and should have investors and policy-makers breathing a sigh of relief.

Daily stock market fluctuations in a highly connected and globalised world are to be expected, but they shouldn’t necessarily be seen as the beginning of the end of the world. What we should be paying more attention to, perhaps, is whether there are long lines outside of our banks and supermarkets. Now that’s what you call a crisis.

3 A $870bn fund learns to use its clout (Richard Milne in Financial Times/Gulf News) Yngve Slyngstad is something of a corporate philosopher. Slyngstad, who heads Norway’s oil fund, the world’s largest sovereign wealth fund, is not merely content with trying to make more money for the local population. He is also thinking deeply about how companies and markets work.

“Where do we actually see the public company going forward? How can we make sure that the public company is actually able to put together a profitable proposition and appropriate flexibility in the way they run their business?” he says in an interview in his office in Norway’s central bank, which manages the fund.

Underlying all this is the extraordinary scale of the oil fund. Less than two decades old, it has experienced a particular growth spurt in the past 10 years as its assets have grown sevenfold to $870 billion. Its size can be difficult to comprehend — it has stakes in almost 10,000 companies and on average owns 1.3 per cent of every group listed on a stock market globally.

However, with this power comes responsibility. The size of the fund’s stakes in many companies means it has been forced to jettison its insistence that it is a mere financial investor and take a more active ownership role and focus on corporate governance. In the past two years the oil fund has moved to becoming an active investor in at least three different ways.

First, it has started revealing its voting intentions at annual meetings. Currently, it discloses how it voted the day after the meeting. Second, the fund is issuing “position papers” setting out its corporate governance principles. So far it has only released two — on proxy access and the ability to vote on individual directors — but Slyngstad says it should be 20 by the end of next year.

The third area of engagement has been more local. Under the Nordic model of governance, a company’s largest shareholders often sit in the nomination committee that decides who the board members will be. After years of declining to join them, the oil fund signed up in 2013 to its first two: truck maker Volvo and paper company SCA, both in Sweden.

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Tsipras quits, calls for early Greek polls; Robots pull off major kidney transplant; It’s a degree, not a ticket to a job

1 Tsipras quits, calls for early Greek polls (Chris Buckler on BBC) Greece’s Prime Minister Alexis Tsipras has announced he is resigning and has called an early election. Tsipras, who was only elected in January, said he had a moral duty to go to the polls now a third bailout had been secured with European creditors. The election date is yet to be set but earlier reports suggested 20 September.

Mr Tsipras will lead his leftist Syriza party into the polls, but he has faced a rebellion by some members angry at the bailout’s austerity measures. He had to agree to painful state sector cuts, including far-reaching pension reforms, in exchange for the bailout – and keeping Greece in the eurozone.

Greece received the first €13bn ($14.5bn) tranche of the bailout on Thursday after it was approved by relevant European parliaments. It allowed Greece to repay a €3.2bn debt to the European Central Bank and avoid a messy default. The overall bailout package is worth about €86bn over three years.

In January, Alexis Tsipras went to the polls as a man who would stand against austerity. What a difference seven months makes. Now he is calling elections to ask the Greek public to support the way he is trying to lead this country out of its financial crisis. That means spending cuts, tax rises and, of course, that third bailout that’s already been agreed.

Mr Tsipras will argue this election is about bringing certainty to Greece’s future. In the short-term at least, though, it will create political uncertainty. And that’s becoming a pretty familiar feeling in Athens.

Some 43 of Syriza’s 149 MPs had either opposed the bailout or abstained in last Friday’s Greek parliamentary vote that approved the deal. The rebellion meant Mr Tsipras had effectively lost his parliamentary majority. Mr Tsipras had won power on a manifesto of opposing the stringent austerity conditions that he has now accepted.

2 Robots pull off major kidney transplant (Johannesburg Times) A sister-to-sister kidney transplant in France this week is the first to combine robotics, vaginal access and the donated organ’s implantation immediately after its removal. The procedure, at the University Hospital Centre in Toulouse, was completed “in a single go, exclusively with robots,” lead surgeon Frederico Sallustro said.

The kidney was both removed and transplanted through the vagina and not by way of incisions, the standard method. Valerie Perez, 44, gave one of her kidneys to her 43-year-old sister, Beatrice, on July 9, with both of them in the operating theatre at the same time. “The two sisters are doing well,” said Sallustro, who was assisted in the operation by medical robotics expert Nicolas Doumerc.

About 100 people – most of them in India, the US and France – had benefited from robotic kidney transplants in the past couple of years, the hospital said. Sallustro and Doumerc first combined this hi-tech method with a transplant to the recipient through the vagina in May.

The donor in that case, however, was a man. With the sisters, the surgical team decided to add a further innovation by completing both parts of the procedure – removal and insertion – immediately after each other. “I’ve been dreaming of doing this operation for the past three years,” Sallustro said, describing it as a “major step forward.”

3 It’s a degree, not a ticket to a job (Kehinde Andrews in The Guardian) The Chartered Institute of Personnel and Development (CIPD) has released a report showing that almost 60% of graduates are in “non-graduate” jobs. This, it argues, should be seen as a wake-up call about the role of the university degree and the “waste” of talent the “conveyor belt of graduates” represents.

The report, however, misses the point about the system of schooling in Britain, and what education should be for. The school system is set up to hand out credentials so that students can fulfil their role in society. A university degree is no different in that sense. And, as the CIPD report explains, it is becoming necessary to hold a degree for jobs that previously did not need them.

The purpose of credentials is to weed people out. So whether or not you need the skills from your degree is irrelevant: you need a degree to be considered for the job in the first place, and that is the value of the qualification. The CIPD report actually shows that the degree is fulfilling its purpose. There is a wider problem with the report, in that it assumes that education should be directly linked to employment. In the Robbins Report of 1962, which led to the expansion of university, this idea was directly rejected.

The aim for the government is that graduates get into the best-paid jobs possible and can pay back their fees. Therefore, the system of ranking university relies heavily on measures of employment after a particular course. I can attest to the pressure that is being put on lecturers to embed “employability” skills into the course and to create links with industry.

Education should be about far more than employment. Particularly at degree level it is an opportunity to study a subject in depth and in doing so pick up a range of transferable skills. Graduates should leave university, among other things, being able to critically engage with problems and issues; have the skills to research a topic and present their work; and to study both independently and in groups.

It is the range of transferable skills that make graduates attractive to employers, yet the drivers from marketisation actually make student less likely to develop them. Reading weeks as replaced with “employability” ones; lecturers are encouraged to wrap students in cotton wool; and dissertations are made optional so that students can pick a range of modules to fit their career paths.

The best advice for any prospective student is to pick a degree that interests you – one that will challenge and extend you. The greatest benefit of education is not to the economy: it is about spreading critical thought and ideas throughout society.

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