Moldova -Russian rel;ations: Why has it taken Moldova so long to shake off its Soviet legacy?

After a few months of heavy fighting between the Moldovan army and pro-Russian rebels backed by the ex-14th Soviet Army, a peace treaty was signed between Moldova and Russian Federation in July 1992.

Since then, the region has become one of Europe's frozen conflicts. Russia de facto controls the political secessionist regime in Tiraspol, although Moscow acts like a mediator in the international 5+2 format for negotiations.

Meanwhile, in wider Moldova, Russian influence came in the form of pro-Russian parties dominating the political scene.

Read more at: https://www.euronews.com/2021/08/27/why-has-it-taken-moldova-so-long-to-shake-off-its-soviet-legacy

Blaming China Helps Nobody Right Now

In 1992, Bill Clinton ran for U.S. president in part against “tyrants, from Baghdad to Beijing.” In 2000, then-presidential candidate George W. Bush made a point in declaring that China was a strategic competitor. And in 2016, before he became president, Donald Trump accused China of “raping” America.

But if the last two weeks are any guide, the politics around China in the 2020 election cycle will make previous electoral contests seem like the seasonal flu compared with, say, a global pandemic.

Even before the outbreak of the coronavirus, U.S.-China relations were under serious strain. The fraying of trust on trade, technology, and military deployments has played out as Beijing has expanded its global footprint, raising questions about its ambitions to alter the U.S.-centered international order.

Then came the coronavirus outbreak, originating in the Chinese city of Wuhan, which has sickened more than 2.5 million people and killed over 180,000. Let’s be clear: The Chinese government mishandled the outbreak, delaying its initial response for weeks and withholding information for six inexcusable days.

Read more: Blaming China Helps Nobody Right Now

Greece: The Simple Math Behind Greece’s Complicated Situation - by Michael Lebowitz

Occam’s Razor is a frequently quoted principle which states that when one is faced with a multitude of seemingly complex possibilities, the simplest approach or explanation is best.  As the ECB and Greece fight over terms of yet another bailout we employ this principle to help better grasp Greece’s dire situation.  

The ratio of debt to GDP is one of the most basic and popular measures used to determine the ultimate ability of a sovereign nation to service its debt. Consider a country which has a debt to GDP ratio of 100%, and a balanced budget (excluding interest payments). In this country, it can be said that the interest rate on its debt and the growth rate of its GDP must be equal for the ratio to stay unchanged. In this example a 2% interest rate with a 1% GDP growth rate would result in an increase from 100% to 101% in the debt to GDP ratio.

As the ratio rises above 100%, the interest rate must be lower than the GDP growth rate or the ratio will continue to rise. At a debt to GDP ratio of 150%, a 2% interest rate would require a 3% growth rate to remain stable at 150%. 

Greece has a current debt to GDP ratio of 170%, and based on current bailout terms, it will likely grow to well over 200%. So applying the logic from above, Greece’s GDP growth rate prior to the current bailout needed to be 1.70 times greater than the rate of interest Greece pays on its debt just to keep its ratio constant. Following are some facts which will allow us make judgments on Greece’s ability to improve or at least sustain its debt to GDP ratio: Since 1970 Greece’s best 5-year annualized GDP growth rate was +1.50% with an average of +.46%. Over the past 10 years growth has averaged -0.50%.

Since 1997 Greece’s lowest 5-year average interest rate on 10 year bonds was 3.41% with an average of 7.50%.  Over the past 10 years the average annual 10 year interest rate was 8.16%

Read more: Michael Lebowitz Blog | The Simple Math Behind Greece’s Complicated Situation | Talkmarkets