Good morning

The headlines:

1. The vagaries of Chinese positioning.

   Link: congressional outcomes along party lines.

   Historically, at the transition of power, the outgoing leader maintains control over the military for the next two years (as chairman of the Central Military Commission). So not really a “transition of power” so much as a “let’s swap some titles for funsies”.

   Hu Jintao will “step down” in March and Xi Jinping will step up.

   The current story is that Hu plans to break with president precedent and retire from the CMC as well – but saying that is not breaking precedent at all. Because that’s what Jiang Zemin said last time; and then, suddenly, a letter with “we’d really really like you to stay on because, um, things are really tense with Japan/Taiwan and, um, we really want you to stick around and stuff“. Signed by everyone on a nice card, with a gift voucher to a golfing store. But no one taking the hint…

   I guess it doesn’t really make a difference. Chinese politics is a mystery to the West – and according to many authors who have “lived in China for the last XX years” and who have “real-life insight”, Chinese politics really affects the Chinese – because 19 of the 20 things on Hu Jintao’s daily to do list are domestic-policy-related.

   

   There will be a balance of power. And that will be that.

2. Even CIA directors use gmail.

   Link: forget privacy.

   Are we seriously still in the age where an extramarital affair, that has next-to-zero to do with your job, results in your retirement?

   Honestly.

   The clandestine email saga that took place over gmail between CIA Director David Petraeus and his biographer Paula Broadwell was “discovered” by the FBI when it was going through his private gmail accounts to see if they had been “compromised” by a suspected “infiltration by China”. Or something.

   And, you know, it could be used as blackmail.

   What I think is really interesting is that he was having the affair with his biographer. Can you say “dramatic climax”? Suddenly: book sales. And more than your general retirement package…

   Smart. His wife will be delighted.

3. The EU and the 2013 budget.

   Link: nothing like it.

   Because it’s not there after the Brussels talks failed this weekend. Meanwhile, Cyprus is going to continue trying to persuade everyone to get along.

   The real point of concern here is: Cyprus holds the current EU revolving presidency. IRELAND takes over from January. Followed by Lithuania, then GREECE, then ITALY.

   It’s like the Hall of just-recently-went-down-in-Flame.

   Italy’s presidency will take us through to 2015, when we will all realise that there’s a water crisis according to the UN; at which point the euro debt crisis will sound all superficial and entirely unimportant.

4. Farewell Vikram.

   Link: Panditry on the compensation front.

   Departing CEO Vikram Pandit will receive around $6.7 million, plus some stocks and deferred options, as a farewell gift.

   Not the “and a complimentary office + use of the corporate jet for life” that some of his predecessors received – but I guess not everyone brought the bank to the brink like Mr Pandit…

   

5. A Libor Update.

   Link: arrests?

   The rumour from “someone close to the investigation but who wishes to remain anonymous”, the UK authorities are ready to make some arrests “within a month”. And then they used the adjective “egregious”.

   

   I can’t decide if the real egregious here is the length of time it has taken for the Serious Fraud Office (SFO) to get to a point when the SFO is within reach of the point where the SFO feels that it might be able to bring people in for questioning make arrests.

   And when the SFO director David Green announces to the world that the SFO has “hoovered up all the stuff from the FSA and loaded it onto our computers”, I can’t help but think that the “Serious Fraud Office” is a prank.

   “Hoovered up all the stuff from the FSA and loaded it onto our computers”.

   Seriously?

   I have this image of the Serious Fraud Office scrambling for a flash drive and describing it as “the small green stick thingy – only, we’ve lost the lid”. Not inspiring.

   PS: the traders are breathing many sighs of belief. Makes you wonder who’s really in charge…

6. The Greeks have a budget. 

   Link: the last budget cuts.

   The 2013 budget has been approved in the early hours of this morning. The vote passed 167 to 128.

   Mr Somaras says that these will be the last budget cuts that the Greek public will have to endure.

   Fingers crossed.

7. Gina Rinehart.

   Link: what money does.

   

   More on the Rinehart family saga. The best line was from Gina’s dad: when he complains about his daughter having turned into a “slothful, vindictive and devious baby elephant”.

   Goodness me.

That’s all for now.

Have a good day.