Breaking the Bubble

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Violence in Tibet prompts international reactions

Prolonged violence in Tibet by Chinese authorities continues to plague the country and plunge it deeper in a sea of bloodshed and tension. This has sparked protests and international reactions around the world, most recently with French president Nicholas Sarkozy threatening to boycott the opening ceremony of the Beijing Olympics.

The French president was the first major world leader to hint at a boycott of the games; the United States, Britain and Germany have all condemned China, but so far have not considered a boycott of the Olympics.

Sarkozy urged China to work with the Dalai Lama.

“Our Chinese friends must understand the worldwide concern that there is about the question of Tibet, and I will adapt my response to the evolutions in the situation that will come, I hope, as rapidly as possible,” Sarkozy said.

Wall Street firm sinks in flailing economy

The subprime mortgage crisis has claimed its most prominent victim to date, namely Wall Street brokerage power Bear Stearns. The firm, which had lost money on its hedge funds that specialized in subprime mortgage lending, was bought by competitor JP Morgan in a deal that was facilitated by the federal government.

The initial offer of two dollars per share, one-fifteenth of Bear’s going market price, was rebuffed by incensed shareholders. JP Morgan raised its offer to ten dollars per share and also agreed to absorb the first billion dollars in losses; the federal government responded by guaranteeing $29 billion in financing. Treasury Secretary Henry Paulson categorized the agreement more as a way to provide much-needed stability for the entire financial market rather than a rescue effort for Bear Stearns shareholders.

The Bear Stearns collapse is part of a financial turmoil that is gripping the country: the dollar has sunk to historical lows against the Euro and the Yen, while the price of oil hovers at $101.22 per barrel which is short of the record $111.80 that was touched on March 17th.