December 31, 2007

Not even new jobs are needed, just a little income support would do

Sir Prof Jacob Borne makes a well argued case for to "Give the tree choppers more profitable jobs than logging" December 31 but I would add that since chopping logs is really not that profitable we should just give some income support to all those who live in the tropical rainforests and engage in traditional and environmentally sustainable non-logging activities.
We actually do not need to produce new high tech manufacturing jobs in the Amazon; a couple of hundred dollars per family a month, for them to improve their living conditions, while they keep an eye on their forest for all of us would do wonders.
The problem is that though we quite easily find ways to support our local parks and national forest reserves this seems so much harder when it comes to maintaining the health of our global common goods like our lungs in the Amazon.

December 29, 2007

Where has financial liberalization taking FT?

Sir your editorial on "Where the financial liberalisation got us" December 29 contains a doubtful statement, some declarations of faith and a big dose of understandable financial sector partisanship.
First can we really speak about liberalisation while a fundamental part of the financial system, namely risk evaluation, is chained by the regulators to the limited criteria of a few credit rating agencies? Before, in banking, there was more of a "you banks you do as you like but only indoors" while now it is more of a "you banks can go out but remember always to do as your nannies the credit rating agencies say" and we could spend years discussing which is the most liberal of those two systems.
Second, among the credos you recite is that of "but before the first Basel agreement on capital adequacy reserves often bore little relation to a bank's risk", and this is something that we all hope is true, but not necessarily so when we see so many banks scrambling around for more capital. Also when you say that "capital [has] been allocated more efficiently" we have to wonder on what basis you are sure of that since most of us would only be able to come up with a "and let us so pray".
Finally, on partisanship, your "Whereas 40 years ago many millions of young people may have wanted to borrow against their future income, in order to go to university…" contains a whereas that might be a little too sweet for our taste when we now read about so many students struggling to repay their loans.

December 22, 2007

The government needs to help turn subprime dollars into prime

Sir Saskia Scholtes writes that the "Helping hand could prolong subprime pain", December 22, and though she argues it well it really does not have to be that way, if the helping hand knows how to help.
Let us suppose that a subprime borrower has a set amount of dollars that he could pay to service his mortgage. In the financial markets, because of discounting of risks, the worth of that dollar cash flow is much lower if it is classified as a subprime lending operation than whether it is viewed as coming from a prime operation. And here is where the government could help turning his subprime dollars into real prime dollars. Could it really be so hard? I mean they are still exactly the same dollars.
A thousand dollars paid monthly during 15 years discounted at 11 percent is worth 88.000 dollars today while the same payments discounted at 6 percent is worth 118.500…35 percent more!
If the government is willing to guarantee, up to a specified amount, the mortgage payments of those who currently own and live in a subprime mortgage financed house then this would empower the borrower to renegotiate with the lender some much better terms, for each of them. This is a win-win strategy for them. Freezing the rates but keeping them subprime is, at best, just a win-lose proposition.
Could this cost the taxpayer some dollars? You bet! But then again someone has to pay for the bank regulators having appointed the credit rating agencies as their financial overseers and with that allowed some small sub-primely awarded mortgage virus to spread globally.

Why do you not make the real problem part of the solution?

Sir in your editorial "Subprime shake-up" December 22, you comment on the Federal Reserve's new proposals for some new mortgage lending practices in exchange for those "that led to this year's subprime debacle" You also recommend that regulators enforce their rules better, for instance by inspecting loans at random… but were not the credit rating agencies supposed to do that?

You must be fully aware that even with much worse lending standards there would have been no subprime debacle at all had the credit rating agencies not blessed the securities backed with these mortgages with their prime credit ratings, and so I must ask why you do not make the real problem part of the solution?

You also mention the risk of over-regulation, but Sir, is not in fact the appointment of the credit rating agencies as the supreme risk overseers in the financial markets the mother of all over-regulations? I believe mortgage bankers are quite capable at handling their job so why not let them get back at it again and get rid of those who fouled it all up?

December 21, 2007

A bailout in the dark?

Sir Mark Fish and Benn Steil in "Root out bad debt or more pain will follow" December 21 make clear the problem that the government has in helping out the subprime mortgage mess namely that the whole securitization process with its slicing and dicing has made it difficult to see where the final losses really lie, and therefore, while reaching out in the dark to help you might mess it up even more. Fish and Steil recommend the purchase of the underlying mortgages at deep discounts while I would prefer buying the houses where a real bona-fide debtor lives at a discount and arranging for a lease and sale back contract that makes sense for the taxpayer and the current owner. Anyhow whatever route is taken one needs at least to be sure that the underlying problem is cleared once and for all since experience says that there is nothing more expensive that keeping a problem pending in the sole expectation of losing less

December 19, 2007

A necessary though not so welcomed reminder

Sir Martin Wolf’s “The dangers of living in a zero-sum world economy” December 19 is a splendid, necessary but of course quite unwelcome aide-memoir for all of us that feel that we have been somewhat unworthily blessed with peace and prosperity during our life time and worry that we will not be able to guarantee the same for our children.

I fully agree that we will have to count on human ingenuity to save our descendants from the dark ages that already lurk close (hugo chávez), but to that end we also need to keep on believing that goodness and badness does not add to a zero-sum human condition

Beware of regulators acting like gods

Sir John Plender asks what is the right level of capital for today´s financial world, “Investors pray for acts of God but even they come at a cost” December 19. His question contains its own answer. Since it is in fact impossible to calculate the right capital then the best thing would be to be humble about it and require one single capital requirement for all assets, instead of arrogantly trying to outwit the market as the regulators did when they created their current minimum capital requirements that differentiates based on how risks are perceived, primarily by the credit rating agencies.

It is when the regulators themselves start acting like God that they really set us up for the big systemic disasters.

December 18, 2007

We need to stop this financial hocus-pocus!

Sir Arturo Cifuentes writes “Weak Basel II may not be enough to calm credit fears” December 18. Of course not! Basel II is just digging us deeper in the hole where the regulators placed us when they so unwisely thought that risks could be determined; and came up with their minimum capital requirements for banks based exclusively on risk, as determined in Basel I by the credit rating agencies and in Basel II by the models of the banks themselves. Those arbitrary regulations were the main cause for all the financial hocus-pocus we are now suffering.

If there is anything rational for the regulators to do now it would be to swallow their pride and require the same percentage of capital for all credits; give the banks some time to orderly adjust to this; and let the markets price the risk of the banks, for instance by forcing the banks to issue subordinated debt as was suggested by the Shadow Financial Regulatory Committee back in 2000.

To top it up, based “the bigger they are the harder they fall” I would also add some additional progressive capital requirements or insurance payment based on size.

A leap into the darkness defines 2007

Sir Gideon Rachman in “Five events that have defined 2007” December 18 unable to identify one single event gives us a list of them and argues that all are loosely linked together by the strain they put on the US. I do not agree with him. Among Rachman’s candidates is the “August: the credit crunch” and since even now, at the end of 2007, the supposedly most sophisticated financial machine that our knowledge economy has ever known does still not have a clue about where they find themselves, no one could have doubts that this event, almost a leap back into the dark ages, must by far be the most defining event of 2007.

Transparency is not completely without value

Sir I am not sure I get or even want to get the full drift of John Dizard’s “Time to admit that the models don’t work”, December 18. As I read it states that through the inter-central bank swap the lines Fed might provide liquidity to the non-US central banks so that these having less restrictions than the Fed can help out taking on their books some of the collateralized debt obligation initially owned by the US banks but swapped into the European banks.

If do this is of course a major operation that gives a totally new meaning to central-bank cooperation though I am not really sure I would like to be on the European side of the bargain. That said if risk adverse central bankers think that the conditions are serious enough to warrant this, why on earth do they not recommend their respective governments to proceed with much more targeted fiscal support measures that can perhaps be better explained to the taxpayer?

I for one would always prefer my government helping directly the mortgage holders who I can at least identify as the beneficiary, than having it give support through the purchase of some debt collateralized with mortgages, where I won’t have a clue whom they are truly benefiting, and the authorities will have to plead blissful ignorance.

No Santa comes Christmas?

Sir Kenneth Rogoff with his “The Fed must not play Santa to the markets” December 18 tells us to be careful since besides recession inflation might be lurking around in the woods. Okay that sounds like a reasonable warning from a reasonable man; problem is what are we to do with it? Given that our current problems might very well be derived from the fact that the Fed dressed as Santa during the rest of the year does Rogoff mean that comes Christmas they should now dress in academic robes?

December 14, 2007

Not Darwin but Frankenstein, not intelligent but unwise

Sir in “The great dying”, December 14, Niall Ferguson discusses the possibility that Darwinian evolution might explain the financial sector’s current difficulties although in the end he also clearly acknowledges that some “intelligent design” had to do with it.

When the bank regulators by means of the Basle Accord decided to drive risks (and creative destruction) out of banks, and imposed their exclusively risk based minimum capital requirements on the banks, they drove in fact banking business out of banks. When they simultaneously also appointed the credit rating agencies as their Blackwater type overseers of risks they also drove bankers out of banks.

The current turmoil is therefore much more a consequence of a Frankenstein’s not so intelligently meddling with the banks and Darwin has nothing to do with it that is unless of course you refer to the bank regulators themselves.

December 13, 2007

Don't they co-ordinate?

Sir, you and everyone praise the co-ordinated actions of the Central Banks but besides those who might argue that could increase the systemic risks, who could argue against the co-ordination of actions between central banks, in fact that in a globalized world they could even think of acting in an un-coordinated way makes us shiver.

Having said when you in “The charge of the central banks” December 13, mention that “the cavalry has arrived” let us pray they brought with them the right ammunition as the enemy has not yet been completely identified.

For instance, besides liquidity injections I would suggest the central banks now give the banks sufficient time to adjust their capital ratios for past sins. What is the need for having all the banks run simultaneously to find more capital just because they have now discovered a fire that has been burning for quite some time?… to add panic to panic does not seem the best of co-ordinations.

Finally, let me say a word about the conditions of the battlefields. The current plans to have the subprime mortgage sector freeze the interest rates amount only to an aspirin and no solution. The only thing that can really make solvent the markets is turning the subprime into prime; like by having the government buy those houses at adjusted prices, financed by the current lenders, and leased out to the current owners turned into tenants and giving these a repurchase option at a price that would hold the taxpayer harmless.

Emigrants/Immigrants of the Whole New World Unite!

Sir if John Gapper can ask “Workers of the New World Unite!”, December 13, when referring to scriptwriters and designers then clearly the same rights should be bestowed on those that voting with their feet and with their remittances are perhaps even more the real workers of the New World, though they still lack a unison voice…. Emigrant/Immigrants of the Whole New World Unite!

Since in gross earnings the emigrants/immigrants definitely represent one of the major economies in the world, they (and the global corporations) are really the ones who should next be empowered with Chairs at the Executive Boards of the World Bank and the International Monetary Fund.

December 12, 2007

The awakening of the financial world

Sir Martin Wolf is daring and right taking on the issue “Why the credit squeeze is a turning point for the world” December 12, but perhaps it is not really the credit squeeze that makes for the inflection point, but more so the general crumbling of some financial credos that were rightly inspired by the knowledge economy but that have turned out to be so lacking in wisdom. We and especially the regulators should have known that.

The appointment of the credit rating agencies to lead the way and yet believing in that the free market would operate freely would be laughable if not for the consequences.

I pray Wolf’s article opens up an urgent debate since our bank regulators are currently, among others with Basel II, just digging deeper and deeper in the hole where we find ourselves.

All is not bad news though. One good thing that could come out of this awakening is to allow banks to be banks again. In many developing countries where the banks because of the risk adverseness introduced by the bank regulators from Basel through their minimum capital requirement formulas, are more and more financing the “risk-free” public sector and the securitized-consumers, and less and less the more risky but yet vital entrepreneurs, and so the comeback of more traditional banking is urgently needed.

Energy is not allocated on a first come first served basis

Sir your editorial “Dark side of the hunt for energy” December 12 is really questionable on the grounds that the US energy consumption is seven times that of China on a per capita basis, and there is nothing to tell us that energy should be allocated on a first come first served basis.

We need to go from ninety days to ten years

Sir if not necessarily “the most” I would absolutely agree with Mr Karel Volckaert opinion that employee compensation is a very telling risk profile indicator when it comes to banks and the financial system in general, December 12. In this respect I also think it behoves us that all the institutions awarded the franchise of “last recourse protection” have employee incentives plans that are based on the medium and long term results, ten years, and not just the next quarter.

The differences between winning a presidency and a Nobel Price

Sir after reading Michael Bloomberg’s “America must resist protectionism” December 12 I am torn between being happy that he is not running as a candidate and is therefore free to spell out the truths and sad because he is not running. Seems you can’t have the cake and eat it too running for president… though you can win a Nobel Prize for being environmental conscientious without even daring to spell out that gasoline/petrol taxes are needed in the US.

December 11, 2007

You must solve the dollar problem with real and not virtual solutions

Sir we have a saying in Venezuela that goes something like “the baby’s crying and the mother is pinching him” and something like that came to my mind when reading Fred Bergsten’s “How to solve the problem of the dollar”. December 11.

If the dollar is really in problems and there are no other currencies willing or able to shoulder its weakness, offering to the trillions of dollars existing in the financial oceans the possibility of converting them into the Special Drawing Rights currency baskets and of which $34bn of value are currently swimming around in the bathtub of the International Monetary Fund, does not seem a solution that carries enough punch. This is something that Bergsten recognizes, but only after he has made his case for radical and insufficient solutions.

Also hearing that the funds would be recycled into the same securities currently offered and that the funds gold holdings of (only) $80bn could provide additional backing, just makes me want to cry more… and perhaps run for the gold myself.

The fact is that if you cannot diversify yourself out of a currency into other currencies then the fault might not lie with the initial weak currency but with all of them and, if so, then you diversify yourself into assets, and then you might realize that the US is not so weak after all, at least if they decide doing something about their weaknesses, like raising the taxes on their petrol/gas consumption to European levels.

You see sometimes the most important assets of a nation are not so apparent because they live in that hazy world of public policies that could be corrected. The US in their gasoline consumption and in their health sector has a world of this type of hidden assets just waiting to be taken to the market.

Allow the banks to be part of the solution

Sir in reference “Chance to restart the stalled securitised credit machine” December 11, and where John Dizzard touches upon a crucial theme I would like to comment the following.
Much of the currently unsatisfied financial needs of the market is directly related to the need of the banks to increase their capital in accordance with the minimum capital requirements set by the regulators in order to sustain on their balance sheet the homecoming of many assets and to make up for the many write-downs.

Since most of this movements are occurring not really because problems appeared but more so because problems were discovered, I cannot understand why the regulators cannot give the banks some time and leeway to rebuild their capital and thereby allow them to help out containing a crisis for which, if it is allowed to snowball, there is not enough capital to take care of the avalanche anyhow.

While writing your European rule book, please don’t forget us

Sir let me take the opportunity of Mr Tommasso Padoa-Schioppa, Italy’s economy and finance minister telling that “Europe needs a single financial rule book” December 11, to piggyback a request that in that rule book there should also be a clear and explicit wording about what to do with the subsidiaries of the European banks in developing countries in times of crisis.

December 08, 2007

The price of the rescue plan could be much lower

Sir you opine that the US subprime initiative is “A rescue plan that is worth the price”, December 8. That may be so but unfortunately the plan by keeping all the mortgages linked to the subprime sector of the market and therefore requiring higher rates keeps the price, in this case paid through the implicit interest rate subsidies that lenders have to absorb, unnecessarily high even if no default occurs. You see whether it is through the loss of interest or the loss of capital, a dollar lost is still a dollar lost.

Much better would be an alternative whereby the US government helped these subprime mortgages deserve prime rates. That this would cost the taxpayers additional money is ludicrous; just wait to see how not solving the problems right will cost the taxpayers money by other means, perhaps as an outright recession.

Personally I favour the idea that the US government, just as it sometimes can buy oil for a Strategic Petroleum Reserve, should offer to buy outright 2.000.000 of the houses currently involved with subprime loans; at a price well below the current outstanding mortgages, a one shot capital loss; financed by the current mortgage holder at government rates; and giving the current debtor a option to repurchase his house in a couple of years at a price that would keep the tax-payer from being harmed.

We are keeping away the minor tremors that keep the big earthquakes away.

Sir nothing, nothing, nothing of the current financial turmoil would have occurred if the credit rating agencies, empowered by the bank regulators to signal that it is possible to measure risks objectively, had not spread around the subprime virus. Of course using the credit rating agencies in the short tem can be something very good and expedient but in the longer run it can only lead to major disasters as the number of questioners are silenced. In my country, Venezuela, whenever there is a small tremor people applaud as these keep the major earthquakes away. Unfortunately, our current bank regulations seem more destined to keep the minor tremors away and it behoves all of us to do something about it.

December 07, 2007

The poor prospective of the Bank against the North

Sir when on your first page you announce the birth of Bank of South you state that the six signing parties aim “to challenge the influence of US-based organizations”. I would contend this is a great exaggeration. Perhaps such a thing might be in the mind of the extremist of the group but for instance a country like Brazil has no interest whatsoever in challenging the World Bank or the Inter American Development Bank, on the contrary it is quite logically doing their utmost to strengthen their voice in those institutions.

Initial funds will be placed in the Bank of South and rapidly withdrawn by each investor for their own favourite projects and thereafter,with its role reduced to paying the salaries of some bureaucrats, it will most probably linger unproductively forever and ever. Could not the south benefit from a Bank of South? Of course, but not from a Bank against the North.

Should we restrain from finding the truth and just go for the usual suspects?

Sir Gillian Tett in “US subprime blame game spreads overseas” December 7, says that “while some politicians think rating agencies are convenient whipping boys, policymakers know that if that line of attack goes too far, it risks undermining investor confidence in the entire credit world.”

That is indeed a totally valid argument but, if we are going to avoid even worse systemic financial crisis in the future, we must also dare to reach further yet and raise the issue that the policymaking-regulators are also to be blamed for having empowered the credit rating agencies too much.

Relaxed going down and relaxed going up

Sir Samuel Brittan afraid of overly tight monetary policies states in "That old Stagflation dilemma again" that when now cheap imports from China might be coming to its end that "the first job now is to convince people that monetary relaxations this winter in spite of rising inflation represent a tactical retreat and not the start of a headlong rout". He is right but we should not forget that the previously falling inflation, helped by China, was also used as support for monetary relaxation, and so the asset bubble resulted.

December 05, 2007

This time it was in fact the regulators who started the whole craziness

Sir David Pitt-Watson tells us that the “Lessons of the credit crisis are not just for regulators” December 5, and of course he is right, who argues the opposite? But when it comes to accountability it might be important to state that this should also be applicable to regulators.

Pitt-Watson mentions that “To be assured that these loans were credit worthy the market passed on this accountability and responsibility to credit rating agencies” but he forgets that, in the case of the banks for example, it was actually the regulators, by means of how they calculate the minimum capital requirements, that basically ordered the banks to make the credit rating agencies their pipers, and I have not yet heard the first regulator being fired, paying a fine, or even named and shamed for doing a crazy thing like that. On the contrary they seem all to be fine and dandy and ready to help out again…with our taxes.

Tons of knowledge for a gram of wisdom!

Sir we are experiencing how prime credit rating agencies pointed us toward clearly subprime directions; not knowing where the risks and the losses of the current financial turmoil are; and sometimes finding out that your highly sophisticated investment banker, whom you pay well, cannot tell you how much your investment is worth, not even on a give and take 20 percent basis.

Since we also so frequently hear references to the concept that our economy has become more knowledge-based, should we not, if only out of modesty, start to downplay that illusion?

Having been an Executive Director of the World Bank a couple of years ago I was of course bombarded with the concept of the Knowledge Bank, then and now my reaction was the same… “Forget your tons of knowledge and please give me a gram of wisdom!”

No use in crying wolf… there are better ways

Sir Martin Wolf searching to explain why the world seems not to be responding as it should to the growing threats of climate change, places the responsibility for it with the individuals saying “if they are to tolerate radical change in the energy use, people must first be frightened and then they must be offered a easy way out”, “Why the climate change wolf is so hard to kill off” December 5.

Although this basic premise sounds right, and should be right, unfortunately it is not right, and so if we sit for that fright and that easy way out to happen, we will all chop down our last tree, just the way we did on Easter Island.

I people knew it was very dangerous to smoke, I people was never offered an easy way out, it took two years of hell, but I people did it because the opportunity costs of not quitting, namely the nagging from wife and daughters, was just too big for any macho man to endure. In similar fashion many governments have managed to come up with ways of how to impose very high petrol taxes on their voters just because the incentives of fiscal earnings were very high.

And so, what is truly needed to get results on climate change is to align the incentives and empower the agents of change. For instance if you want to reduce the use of cars in the US, which is an environmental must, let local authorities auction off public transport monopolies and thereby enlist bus manufacturers and bus drivers in the army fighting climate change.

Wives and daughters (leaders of the world)… get us working on the climate change… you like heat even less than we do.

December 04, 2007

Financial Time’s Hillary Clinton interview

Sir the following is my reaction after reading the interview of Senator Hillary Clinton, conducted by Financial Times ’s Washington bureau chief Edward Luce.

Protectionism: Full fledged competition in a globalized world would have eroded the profitability of many companies had we not awarded them the protection of intellectual property rights, and invested some serious money in making that shield mean something. Can you imagine Microsoft in a world where efficient software copiers are free to roam?

Therefore since most of labor have not been furnished similar new protections, and some old ones have in fact been taken away, it should not come as a surprise that the share of labor income as a percentage of GDP is dropping, and that this is, certainly and rightly, creating a source of conflict.

So what’s to be done? There are only two choices? Either we award to labor similar protections which would set us all on a de-globalization route, a lose-lose proposition; or we must require that the beneficiaries of intellectual property rights give back some extra of their quasi-monopoly based extra earnings to the society. As an absolute minimum, this should represent the direct cost of enforcing and defending their rights. Is this protectionism? No at all!

Review of existing trade agreements: Absolutely. In some of the US bilateral agreement some prohibitions were imposed on developing countries because at the time they were considered as appropriate, but hindsight has led to other conclusions and so these clauses need to be revisited. For instance some US trade agreements prohibit any restrictions on capital movement even though now these restrictions are deemed quite good at taking away some of the excessive volatility that the waters of the global financial oceans can have on local bathtubs.

Energy and environment: “the most important thing is getting the US focused on energy efficiency, on clean renewable energy, combating global warming on raising gas mileage etc.” Just like the recent Nobel price recipient Hillary Clinton does not have the courage of spelling out what is primarily needed to really alter the energy and environment realities in the US, namely a substantial tax on gasoline consumption.

Housing crisis: Just like the US can sometimes use a Strategic Petroleum Reserve I would suggest the government buying a large amount of the houses currently involved with subprime loans; at a price below the current outstanding mortgage; financed by the current mortgage holder; and giving the current debtor a option to repurchase his house in a couple of years at a price that would keep the tax-payer form being harmed. That’s what I would do… but then again I am no PhD and so I could be wrong

December 03, 2007

I pray we will become one nation again!

Sir my country Venezuela is a world war one battlefield. Two deeply dug in trenches with about a quarter of the voters each, another quarter of the voters running exposed in no mans land, and the final quarter wandering around bomb shocked and oblivious to all in the neighbouring woods. I pray to God we will become a nation again.

December 01, 2007

Please do not sell US assets at bargain basement prices!

Sir reading John Gapper’s “America must live with being a bargain basement” December 1, and the sale of 4.9 percent of Citigroup to an investment arm of the Abu Dhabi government, it somehow led me to think about the “Memoirs of a Geisha” that describes the creation of a vicious competitive bidding process in order to maximize the value of a young girl's virginity.

I just wonder whether if someone had previously set a maximum limit to how much of a Citigroup could be sold to middle east countries before being blocked similar to how the takeover of some US ports were one would not have been able to generate that scarcity value that could have led the investor to gladly fork out at least twice what they paid for those shares.

Sincerely, in these days when we read of billions of run away losses in a world that has no idea where to invest, one could believe that the shares of the bank that never sleeps in the US and that is one of those that has seemingly become too large to fail should be worth a bit more.
There are other strengths in the US of course but the assets of America are the main line of defence when it comes to hold up the value of those dollars we are all holding and so if these assets start going at bargain basement prices, then we are all really in a jam.

We must help people to go where they feel they belong… alive

Sir Christopher Caldwell in “Rioters vs state in a test of will” December 1, quotes the Socialist leader Malek Boutih saying “they are whole populations here that don’t feel they belong to this country” and informs that the bodies of the dead boys “will be flown to Morocco and Senegal, respectively, for burial”, which leaves us all with the question of why could they not have been flown there alive?

The poor in developing countries frequently face no other choice than to emigrate to richer countries in order to survive physically but many alienated and frustrated citizens of developed countries do not really have the choice to emigrate somewhere else in order to survive emotionally, and perhaps they should have.

For instance if these dead boys had had the option of selling whatever French citizen’s rights they had to a foreigner truly interested in coming to France and with that money could have financed their resettlement to Morocco or Senegal perhaps we could have solved the problems on two fronts.

Clearly it is not as easy as that but the world needs to find new and different ways to fight violence originated from deep sentiments of alienation with other means than violence.