Saturday, October 11, 2008
In "Hello, Dolly!"--yes, nothing like quoting from musicals while understanding crises!--Dolly Levi quotes her late husband: "Money, pardon the expression, is like manure. It's not worth a thing unless it's spread around encouraging young things to grow."
That is exactly what banking does--makes sure that the manure is spread around. With the economic crisis, there is pretty much no money to go around. Bernanke and Paulson, and central bankers around the world are trying their best to infuse liquidity into the system. But, doggone it, we are bloody scared to lend our money to anybody anymore. Which is why auto dealerships are closing down--no credit available. Even grain exports are stalling because of distrust in any piece of paper promising payment. So, forget the market indices for now. That is a symptom and not the problem.
About 2:30 into this YouTube clip, you will see Horace Vandergelder (Walter Matthau) say that very line about money and manure, which is when Dolly (Barbra Streisand) says she is ready to marry him :-)
Friday, October 10, 2008
Bad, bad, scheduling.
I don't mean that they intentionally scheduled it this way, but the TV folks have a responsibility that they have conveniently overlooked.
If you had purchased $1,000 of AIG stock one year ago, you would have been left with $42 now.
With Lehman, you would have $6.60 left.
With Fannie or Freddie, you would have less than $5 left.
But if you had purchased $1,000 worth of beer one year ago, drank all of the beer, then turned in the cans for the aluminum recycling REFUND, you would have had $214.
You now know where to invest
President Bush is nearing what may be a new distinction: an historic 45-point spread between the voters who give his performance a thumbs down and those who are still giving him a thumbs up.
Though this may be an arcane calculation, it's interesting to ponder.
At one moment in his presidency, Richard Nixon registered 66% disapproval rating from voters, against a 24% approval, for a 42-point differential.
Harry Truman, often derided by critics, experienced a range of 43 points between the disapproval and approval numbers.
Santi Tafarella, who blogs at Prometheus Unbound, looked at years of the numbers from the Gallup Poll and concluded that George W. Bush has passed Nixon and Truman to become the president with the widest spread.
As is apparent from the Roper Center for Public Opinion Research's chart above, at the moment, the president's disapproval ratings are at 70%, while only 25% gave him positive marks. Which would give him an historic margin of 45 points.
And speaking of Tuesday's debate, here's a YouTube clip of media theorist Marshall McLuhan appearing on the Today show in 1976 to comment on the debates between Gerald Ford and Jimmy Carter. Hosting the Today show? One Tom Brokaw, who seemed every bit as perplexed by complex thought and the English language as he does today (Edwin Newman, NBC's resident egghead, is also there). It's a really interesting clip, I think, especially because it shows how little has changed in the staging of political spectacle.
In many ways, McLuhan's criticisms of the debate format are more relevant now than ever given that we live in a radically deconstructed media environment. Phoney-baloney pseudo-events such as the presidential debates are even more
self-evidently agitprop for, well, phoney-baloney pseudo-events. (Note: The technical difficulties that Brokaw, Newman, and McLuhan refer to resulted in a 27-minute delay during which moderater Harry Reasoner "vamped" while the candidates stood like wooden puppets at their podiums.)
IN ECONOMIC theory the winner’s curse refers to the idea that someone who places the winning bid in an auction may have paid too much. Consider, for example, bids to develop an oil field. Most of the offers are likely to cluster around the true value of the resource, so the highest bidder probably paid too much.
The same thing may be happening in scientific publishing, according to a new analysis. With so many scientific papers chasing so few pages in the most prestigious journals, the winners could be the ones most likely to oversell themselves—to trumpet dramatic or important results that later turn out to be false. This would produce a distorted picture of scientific knowledge, with less dramatic (but more accurate) results either relegated to obscure journals or left unpublished.
In Public Library of Science (PloS) Medicine, an online journal, John Ioannidis, an epidemiologist at Ioannina School of Medicine, Greece, and his colleagues, suggest that a variety of economic conditions, such as oligopolies, artificial scarcities and the winner’s curse, may have analogies in scientific publishing.
Dr Ioannidis made a splash three years ago by arguing, quite convincingly, that most published scientific research is wrong. Now, along with Neal Young of the National Institutes of Health in Maryland and Omar Al-Ubaydli, an economist at George Mason University in Fairfax, Virginia, he suggests why.
It starts with the nuts and bolts of scientific publishing. Hundreds of thousands of scientific researchers are hired, promoted and funded according not only to how much work they produce, but also to where it gets published. For many, the ultimate accolade is to appear in a journal like Nature or Science. Such publications boast that they are very selective, turning down the vast majority of papers that are submitted to them.
The assumption is that, as a result, such journals publish only the best scientific work. But Dr Ioannidis and his colleagues argue that the reputations of the journals are pumped up by an artificial scarcity of the kind that keeps diamonds expensive. And such a scarcity, they suggest, can make it more likely that the leading journals will publish dramatic, but what may ultimately turn out to be incorrect, research.
Dr Ioannidis based his earlier argument about incorrect research partly on a study of 49 papers in leading journals that had been cited by more than 1,000 other scientists. They were, in other words, well-regarded research. But he found that, within only a few years, almost a third of the papers had been refuted by other studies. For the idea of the winner’s curse to hold, papers published in less-well-known journals should be more reliable; but that has not yet been established.
The group’s more general argument is that scientific research is so difficult—the sample sizes must be big and the analysis rigorous—that most research may end up being wrong. And the “hotter” the field, the greater the competition is and the more likely it is that published research in top journals could be wrong.
There also seems to be a bias towards publishing positive results. For instance, a study earlier this year found that among the studies submitted to America’s Food and Drug Administration about the effectiveness of antidepressants, almost all of those with positive results were published, whereas very few of those with negative
results were. But negative results are potentially just as informative as positive results, if not as exciting.
The researchers are not suggesting fraud, just that the way scientific publishing works makes it more likely that incorrect findings end up in print. They suggest that, as the marginal cost of publishing a lot more material is minimal on the internet, all research that meets a certain quality threshold should be published online. Preference might even be given to studies that show negative results or those with the highest quality of study methods and interpretation, regardless of the results.
It seems likely that the danger of a winner’s curse does exist in scientific publishing. Yet it may also be that editors and referees are aware of this risk, and succeed in counteracting it. Even if they do not, with a world awash in new science the prestigious journals provide an informed filter. The question for Dr Ioannidis is that now his latest work has been accepted by a journal, is that reason to doubt it?
Thursday, October 09, 2008
The real threat to academic freedom today, then, generally comes from outside academe, not from within it. How can we secure academic freedom when its guarantor — tenure — is on the wane, and the public is indifferent or even hostile to it?Good question, right?
Wait a minute. Before we get to the answer to this question ... I know I have a piece of paper that says I have indefinite tenure. But, to my knowledge, my freedom is absolutely restricted. Well, maybe it is just me!
Anyway, that quote is from an opinion piece in the Chronicle, and is authored by the former general secretary of the AAUP. BTW, I don't know how the AAUP came to create an office in its structure called the "general secretary". I mean, the UN has its Secretary General. And the only place with such a title? Well, that was the official title of the most powerful leader of ****--I won't tell you; email me if you want the info :-)
Ok, back to how that question is answered. Ready? Here it is:
I have given up hope that the trend to replace full-time, tenure-track positions with non-tenure-track, part-time ones can be arrested, let alone reversed. Tenure, it seems to me, is bound to be eventually scuttled.
Yet asserting a possibility is not the same as passively accepting its inevitability. The 1940 statement began by saying that its purpose was "to promote public understanding and support of academic freedom and tenure." Almost 70 years later, it is evident that this purpose has not been fulfilled. Decoupling academic freedom
from tenure just may be, as my British colleague asserted, the best way to protect academic freedom.
Elevating that ideal and aspiration into a legal right, possibly into an enumerated constitutional right in certain states, with a force equal to the First Amendment, may be a Faustian bargain, but also, alas, it may be the very best deal that America's faculty members can cut. Tenure, after all, has always been a means to an end — securing academic freedom. Perhaps the time has come to rethink the best way to preserve academe's highest value.
So, over to Roubini:
Nouriel Roubini: The world is at severe risk of a global systemic financial meltdown and a severe global depression
The U.S. and advanced economies’ financial systems are now headed towards a
near-term systemic financial meltdown as day after day stock markets are in free fall, money markets have shut down while their spreads are skyrocketing, and credit spreads are surging through the roof. There is now the beginning of a generalized run on the banking system of these economies; a collapse of the shadow banking system, i.e. those non-banks (broker dealers, non-bank mortgage lenders, SIV and conduits, hedge funds, money market funds, private equity firms) that, like banks, borrow short and liquid, are highly leveraged and lend and invest long and illiquid, and are thus at risk of a run on their short-term liabilities; and now a roll-off of the short term liabilities of the corporate sectors that may lead to widespread bankruptcies of solvent but illiquid financial and non-financial firms.
On the real economic side, all the advanced economies representing 55% of global GDP (U.S., Eurozone, UK, other smaller European countries, Canada, Japan, Australia, New Zealand, Japan) entered a recession even before the massive financial shocks that started in the late summer made the liquidity and credit crunch even more virulent and will thus cause an even more severe recession than the one that started in the spring. So we have a severe recession, a severe financial crisis and a severe banking crisis in advanced economies.
There was no decoupling among advanced economies and there is no decoupling but rather recoupling of the emerging market economies with the severe crisis of the advanced economies. By the third quarter of this year global economic growth will be in negative territory signaling a global recession. The recoupling of emerging markets was initially limited to stock markets that fell even more than those of advanced economies as foreign investors pulled out of these markets; but then it spread to credit markets and money markets and currency markets bringing to the surface the vulnerabilities of many financial systems and corporate sectors that had experienced credit booms and that had borrowed short and in foreign currencies. Countries with large current account deficits and/or large fiscal deficits and with large short-term foreign currency liabilities and borrowings have been the most fragile. But even the better performing ones – like the BRICs club of Brazil, Russia, India and China – are now at risk of a hard landing. Trade and financial and currency and confidence channels are now leading to a massive slowdown of growth in emerging markets with many of them now at risk not only of a recession but also of a severe financial crisis.
The crisis was caused by the largest leveraged asset bubble and credit bubble in the history of humanity where excessive leveraging and bubbles were not limited to housing in the U.S. but also to housing in many other countries and excessive borrowing by financial institutions and some segments of the corporate sector and of the public sector in many and different economies: an housing bubble, a mortgage bubble, an equity bubble, a bond bubble, a credit bubble, a commodity bubble, a private equity bubble, a hedge funds bubble are all now bursting at once in the biggest real sector and financial sector deleveraging since the Great Depression.
At this point the recession train has left the station; the financial and banking crisis train has left the station. The delusion that the U.S. and advanced economies contraction would be short and shallow – a V-shaped six month recession – has been replaced by the certainty that this will be a long and protracted U-shaped recession that may last at least two years in the U.S. and close to two years in most of the rest of the world. And given the rising risk of a global systemic financial meltdown, the probability that the outcome could become a decade long L-shaped recession – like the one experienced by Japan after the bursting of its real estate and equity bubble – cannot be ruled out.
And in a world where there is a glut and excess capacity of goods while aggregate demand is falling, soon enough we will start to worry about deflation, debt deflation, liquidity traps and what monetary policy makers should do to fight deflation when policy rates get dangerously close to zero.
At this point the risk of an imminent stock market crash – like the one-day collapse of 20% plus in U.S. stock prices in 1987 – cannot be ruled out as the financial system is breaking down, panic and lack of confidence in any counterparty is sharply rising and the investors have totally lost faith in the ability of policy authorities to control this meltdown.
This disconnect between more and more aggressive policy actions and easings, and greater and greater strains in the financial market is scary. When Bear Stearns’ creditors were bailed out to the tune of $30 bn in March, the rally in equity, money and credit markets lasted eight weeks; when in July the U.S. Treasury announced legislation to bail out the mortgage giants Fannie and Freddie, the rally lasted four weeks; when the actual $200 billion rescue of these firms was undertaken and their $6 trillion liabilities taken over by the U.S. government, the rally lasted one day, and by the next day the panic had moved to Lehman’s collapse; when AIG was bailed out to the tune of $85 billion, the market did not even rally for a day and instead fell 5%. Next
when the $700 billion U.S. rescue package was passed by the U.S. Senate and House, markets fell another 7% in two days as there was no confidence in this flawed plan and the authorities.
Next, as authorities in the U.S. and abroad took even more radical policy actions between October 6th and October 9th (payment of interest on reserves, doubling of the liquidity support of banks, extension of credit to the seized corporate sector, guarantees of bank deposits, plans to
recapitalize banks, coordinated monetary policy easing, etc.), the stock markets and the credit markets and the money markets fell further and further and at accelerated rates day after day all week, including another 7% fall in U.S. equities today.
When in markets that are clearly way oversold, even the most radical policy actions don’t provide rallies or relief to market participants. You know that you are one step away from a market crash and a systemic financial sector and corporate sector collapse. A vicious circle of
deleveraging, asset collapses, margin calls, and cascading falls in asset prices well below falling fundamentals, and panic is now underway.
At this point severe damage is done and one cannot rule out a systemic collapse and a global depression. It will take a significant change in leadership of economic policy and very radical, coordinated policy actions among all advanced and emerging market economies to avoid this economic and financial disaster. Urgent and immediate necessary actions that need to be done globally (with some variants across countries depending on the severity of the problem and the overall resources available to the sovereigns) include:
- another rapid round of policy rate cuts of the order of at least 150 basis points on average globally;
- a temporary blanket guarantee of all deposits while a triage between insolvent financial institutions that need to be shut down and distressed but solvent institutions that need to be partially nationalized with injections of public capital is made;
- a rapid reduction of the debt burden of insolvent households preceded by a temporary freeze on all foreclosures;
- massive and unlimited provision of liquidity to solvent financial institutions;
- public provision of credit to the solvent parts of the corporate sector to avoid a short-term debt refinancing crisis for solvent but illiquid corporations and small businesses;
- a massive direct government fiscal stimulus packages that includes public works, infrastructure spending, unemployment benefits, tax rebates to lower income households and provision of grants to strapped and crunched state and local government;
- a rapid resolution of the banking problems via triage, public recapitalization of financial institutions and reduction of the debt burden of distressed households and borrowers;
- an agreement between lender and creditor countries running current account surpluses and borrowing, and debtor countries running current account deficits to maintain an orderly financing of deficits and a recycling of the surpluses of creditors to avoid a disorderly adjustment of such imbalances.
At this point anything short of these radical and coordinated actions may lead to a market crash, a global systemic financial meltdown and to a global depression. The time to act is now as all the policy officials of the world are meeting this weekend in Washington at the IMF and World Bank annual meetings.
Wednesday, October 08, 2008
Over the last few days, stock markets all over the world have been on a losing trend and every other television reporter and commentator keeps referring to this as the market going “south.” And, without fail, I feel myself wanting to yell at the reporter to stop using “south” in this context.
My objection is not simply because “south” is one of the four cardinal directions along with east, west, and north. And my objection is not because the market indicators cannot move sideways—east or west—but can only go up or down, or remain unchanged.
I have trouble with the usage of “south” in the context of bad news because we keep reinforcing the notion, perhaps unintentionally, that “south” is bad and, therefore, “north” is good.
We don’t realize how much such connotations of north and south is ingrained in us until we begin to examine it. Pretty much every region in the world has its own version of the “northern superiority” over its southern neighbor.
Every once in a while I ask my freshman students whether there is any geographic pattern when it comes to the location of rich and advanced countries on a world map. Before long, the majority opinion is always that it is in the north that rich countries are located whereas all the poorer countries are in the south. When I push them for possible explanations, they can’t seem to resist the temptation that a northern location is just better.
After a few minutes of waiting for students to start questioning this framework, I present them with the first of my exhibits to challenge this assumption. When I ask them about Australia and New Zealand, I typically start seeing those light bulbs going on in them. They know that these countries way south of us are no economic basket-cases by any measure. We slowly then begin to reshape our assumptions about any innate virtues of the “north.”
And when I ask them where the richest and advanced countries of the day were located about a thousand or three thousand years ago, they begin to articulate an understanding that a northern location or a southern location does not necessarily make permanent a country’s economic fate. Being in the south is, therefore, no curse either. “Going south” then doesn’t carry the same connotations anymore.
Students get an opportunity to follow-up on this if ever they wander into my office and look up at the world map on the wall. It is a wonderful teaching and learning moment when I see in their eyes a little bit of confusion as they try to figure out why the map looks strange. It takes them only a few seconds to realize that it is an upside down map of the world—one that I purchased when we visited New Zealand.
Well, for all I know, maybe they leave the room feeling that they have just exited the Bizarro World of comics, where up is down, and left is right!
Perhaps it is the geographer in me that makes me write about this. Or, maybe because I grew up in a country that is located to the south of North America and Western Europe. In any case, the unfortunate aspect is that in characterizing misfortunes as “going south” we end up reinforcing an incorrect idea that somehow south is inferior.
I am not sure whether the television audience systematically, and strictly, treats “south” as a metaphor for a certain trend line and nothing else. (I hope I have not messed up with professional grammarians by referring to metaphors!)
Metaphors are powerful tools, particularly in rhetoric. Politicians use metaphors almost all the time because of the deep emotional response they can trigger. Some of the greatest orators, like Martin Luther King Jr. used metaphors that wonderfully blended together and helped convince the populace about the issues and ideas, and energized them into action. Most of us lesser mortals though tend to abuse metaphors.
So, while acknowledging that the economic indicators are “down”, here is to hoping that they will go “up” really soon and fast.
Don't look. Seriously, don't look. I have no idea what's going on with any of my equity investments, because that is not short term money that I need to keep my eye on.
If you look you will get upset, and you will be tempted to do something stupid. I can't guarantee that the market won't drop further and you won't regret having held on. But as a general rule, selling into a massive liquidity crisis is a pretty bad idea. Selling in a panic because your assets just dropped 30% is almost certainly a bad idea.
The good news is that while the stock market can take a long time to recover, it historically doesn't actually go down for more than a couple of years.
Yeah, that's not very good news. But unless you're planning to retire right now, my advice remains the same: don't look.
Sage advice from Megan McArdle
Tuesday, October 07, 2008
the market has become a case study in the psychology of crowds, many experts say. In normal times, it runs on a healthy mix of fear and greed. But fear now seems to rule, with investors often exhibiting a Wall Street version of the fight-or-flight mechanism — they are selling first, and asking questions later.
“What’s happening is people are crawling into a bunker and pulling an iron sheet over their heads because they think the sky is falling,” said William Ackman, a prominent hedge fund manager in New York.
And that bunker is getting very crowded, so much so that some analysts are starting to suggest the markets are showing signs of “capitulation” — another term of art to describe what happens when even the bullish holdouts, the unflagging optimists, throw up their hands and join the stampede out of the market.
U.S. Marine Cpl. Contreras, a 2003 graduate of South High, died two weeks ago after surviving two tours in Iraq.
He took his own life after suffering, it appears, from post-traumatic stress disorder. ....
Being in battle wasn’t supposed to be part of his job, but on one occasion he and some fellow Marines left the base and ended up in the middle of a gunfight.
“He had to use his weapon,” Esther said. “Five guys were shooting in a crowd of women and children. He knows he shot a woman. He didn’t know if he shot any children.”
At one point, he had a nervous breakdown during a Disneyland fireworks show, his family said. Light flashing in the air had been a signal for help in Iraq.
The episode was one of the few moments his family and friends noticed something out of the ordinary with Leonardo.
Read the entire report, with photographs, here.
Monday, October 06, 2008
An unemployed financial advisor apparently despondent over his troubles shot and killed his wife, his mother-in-law and three children before taking his own life in a gated community in the northwest San Fernando Valley, Los Angeles police said today. ....
The 45-year-old suspect used a handgun he purchased Sept. 16, Moore said. The weapon was found next to the gunman's body, officials said.The bodies of the man's 39-year-old wife, 70-year-old mother-in-law, and three sons -- ages 19, 12 and 7 -- were found inside the home's various bedrooms. ...
Friends and neighbors identified the couple as Karthik and Subasri Rajaram, who had lived in the neighborhood for about two years.Moore said police believe that the gunman shot the victims sometime after 6 p.m. Saturday, and that he had left behind three letters indicating that he had carried out the killings.
He said the gunman had worked previously for Price Waterhouse and Sony Pictures and "had attested to some financial difficulties," Moore said. "He had become despondent over his financial" situation.
How terrible this LA Times report is. I fear for more of such news as the economic situation turns worse ....
The names suggest that the family hailed from Tamil Nadu, which is where I am from. For all I know, maybe I am even related to them.
[They] couldn't anticipate that when a tiny country bails out a bank whose assets vastly exceed the country's own GDP, then the sovereign itself loses much creditworthiness. One scary datapoint: the assets of Kaupthing Bank amount to 623% of Iceland's GDP, which is possibly why its own credit default swaps are trading somewhere over 2500bp.Tyler Cowen has a link to the Financial Times that has a list of European banks with assets greater than the gdp of their respective home countries. UBS, which was one of the earliest banks to admit to its messed up books, had assets that were 484% of the Swiss GDP!
How bad can things get in Iceland?
Here's what one local emailed Tom Braithwaite:
They are fighting powers that they are powerless to fight. It's like tackling a storm raging in the sea with a teaspoon.The main supermarket can't get imported goods because they have no currency. The shops are half empty. One of the store managers has advised people to start hoarding. We're running out of oil. And winter came last night - about a month early.
Now, Russia is again getting aggressive. China has worked out a strange system that mixes economics and politics in ways we won't dream of (I hope). The Islamic world is trying to figure out how to balance religion, economics, and politics. Latin America seems to be off on its own with Venezuela and Bolivia marching to a different beat. So, what does Fukuyama think now?
Well, he says that America as a "brand" has undergone some serious damage. I am thinking, hey, I wrote about this in two opeds a few months ago. Reminds me of one of my graduate school professors who remarked that who you are when you say something is often more important than whatever important you might have to say :-)
Anyway, Fukuyama notes that
Ideas are one of our most important exports, and two fundamentally American ideas have dominated global thinking since the early 1980s, when Ronald Reagan was elected president. The first was a certain vision of capitalism—one that argued low taxes, light regulation and a pared-back government would be the engine for economic growth. Reaganism reversed a century-long trend toward ever-larger government. Deregulation became the order of the day not just in the United States but around the world.
The second big idea was America as a promoter of liberal democracy around the world, which was seen as the best path to a more prosperous and open international order. America's power and influence rested not just on our tanks and dollars, but on the fact that most people found the American form of self-government attractive and wanted to reshape their societies along the same lines—what political scientist Joseph Nye has labeled our "soft power."
It's hard to fathom just how badly these signature features of the American brand have been discredited.
A better name for our new system might be life jacket capitalism. The role of the watchdogs isn't just to enforce seat-belt and helmet laws for the financial sector. Market misjudgments have produced systemic risk with growing intensity and alarming frequency, requiring rescues in 1988 (the savings-and-loan crisis), 1994 (the Mexican collapse), 1997 (the Asian meltdown), 1998 (the Long Term Capital Management debacle), and 2008 (the subprime catastrophe). In an age of globalization, threats to the financial system can arise unexpectedly from almost any place. What's scary about such an arrangement is how much power it vests in our economic guardians and how vigilant, wise, and adroit those guardians need to be. One dud call like letting Lehman go and the whole world can blow up. .....
private enterprise on its own won't address global ills such as climate change, economic inequality, or systemic financial risk. Put a different way, when capitalism stops working, it's time to start looking for a good adjective. Jacob Weisberg in Slate
Sunday, October 05, 2008
Doug Schoen, a Democratic strategist and pollster who worked for President Bil Clintonfor six years, said that should Mr. Obama win next month, he should not mistake his electio for a mandate for sharply higher taxes on the wealthy or major government expansion. “The polling I’ve done shows that people are anti-Republican, not pro-left, not pro- redistribution,” he said. “They’re ever more skeptical of Washington.”
For example, in the poll by CBS News released earlier this week, 44 percent of Americans said businesses now faced “too much” or “the right amount” of regulation, compared to 43 percent who said they faced too little. In a New York Times/CBS News Poll in September, 42 percent said Mr. Bush’s tax cuts, which overwhelmingly benefit the wealthy, should be made permanent, while 36 percent said they should be allowed to expire over the next several years.
Most strikingly, 34 percent described themselves as conservative, compared to only 20 percent as liberal. Those figures have hardly changed since September 2000, when 32 percent described themselves as conservative and 20 percent as liberal.
... Jeffrey Garten, a professor at the Yale School of Management who was an undersecretary of commerce in the Clinton administration, said lawmakers are likely to impose stricter regulatory oversight on several industries — especially financial companies and markets.
... “I’m scared about the next year but I’m very optimistic we’ll come out of this in good shape,” he said. “We very well may come out of this horrible situation with a better version of American capitalism — it’ll be a little tamer; it’ll be a little more regulated.”
“But this country is built on an appetite for risk,” he added. “We don’t want to be France.”