Clarissa Tan

Even as our attention is gripped by a crumbling eurozone, another huge economic entity is emerging in the marketplace — Facebook, which has just upsized its number of IPO shares by a quarter before its $100 billion flotation tomorrow. Providing the crisis in Europe does not blow out into a huge political standoff (and just stays the gigantic economic mess it currently is), which entity would future historians regard as the defining business model of our age? Both the eurozone and Facebook, in a way, try to deal with the problems of geography — how to connect people from different places and cultures.

Greece is the centre of European attention, but as George Osborne met with other EU finance ministers today there was another issue bubbling in the background — Basel III. This had been brewing for a while and is yet one of those matters that threatened to isolate Britain from the rest of the EU (though some would argue this is a good place to be). The Chancellor this morning appears to have agreed to the Basel III accord, which stipulates the amount and quality of capital that banks are required to keep. But this was after much haggling — and an Osborne outburst where he said signing on to the original banking capital rules would make him look ‘like an idiot’ — saw amendments being added.

The newspapers and internet today are full of headlines about Mervyn King admitting the Bank of England was ‘late to the game’, and that central bankers should have ‘shouted from the rooftops’ regarding the financial blow-up. It’s true, the BoE governor did make these ‘mea culpa’ remarks — but they came rather half-heartedly, and couched within a radio lecture that seemed to point even more fingers at other parties.   King was giving the Today Programme Lecture 2012, which he addressed to a Radio 4 theatre audience yesterday evening. Early in the half-hour speech, he gave an anecdote from 1997, in which then-governor Eddie George and him, Merv, celebrated Gordon Brown’s proposal for Bank independence.

Ni hao. In recent days, Boris, Ken and Brian have all leapt headlong onto Weibo, China’s highly popular version of Twitter. It's an obvious effort to win the votes of Chinese-speakers living in London. Boris was the first — which, I suppose, says all you want to know about his sense of initiative, brio, élan, and whatever the Chinese word is for ‘mojo’. Ken and Brian both jumped in about two weeks later, around April 21.   Inevitably, because the vast majority of Weibo users live in China, our three London mandarins have ended up attracting followers based in the Middle Kingdom. A look at the mayoral candidates’ individual Weibo accounts gives a pretty accurate picture of the recognition and popularity they hold abroad.

Of all the Springs we’ve seen, perhaps the Burmese one is the most astonishing. It’s because the person aligned on the side of oppressive leadership — President Thein Sein, formerly of the junta — in a sense participated in the Spring himself. Aung San Suu Kyi has claimed a staggering by-election victory — her National League of Democracy party looks set to win 44 of 45 constituencies contested — after last year finally agreeing to end the NLD’s boycott of Burma’s 'democratic' system. This was after she’d found common ground with Sein, who had unexpectedly unveiled an array of political reforms.

It’s the New Year — a time when politicians all over the globe get on their soapboxes and preach to their people. From Merkel’s pledge to do everything for the euro, to North Korea’s vow to defend their new leader unto death, to Putin’s speech laden with sexual innuendo, here’s a selection of this year's messages from world leaders: Barack Obama: ‘I promise to do everything I can to make America a place where hard work and responsibility are rewarded, one where everyone has a fair shot and everyone does their fair share. That's the America I believe in.’ Angela Merkel: ‘Today, you can trust that I will do everything to strengthen the euro. This will only succeed if Europe learns from the mistakes of the past.

It’s not very festive, but we have to wander into acronym territory again. Moody’s last night warned that the UK’s AAA credit rating is at risk if economic growth continues to slow. At the same time, minutes from the Bank of England’s meeting early this month, released today, show that its committee members were unanimous in backing Quantitative Easing, and several of them feel more QE can be justified. But how potent can QE be if Britain loses its AAA? It’s clear that George Osborne, who’s claimed that the UK has retained its top debt rating so far due to his deficit-cutting and austerity measures, won’t have a happy new year if Britain loses its AAA. But it’s going to be a big headache for Mervyn King too.

Mervyn King's words today, in the Financial Stability Report, are probably more important to the UK economy than George Osborne's on Tuesday. As James points out in the magazine this week, Osborne's plans could well turn out to be irrelevant if the eurozone collapses, flattening whatever is left of Britain's growth prospects. Basically, King feels that, thanks to the euro crisis, we're all headed for a credit crunch. This echoes Downing Street's sentiments yesterday. He says UK banks are well capitalised but should still boost their reserves – not by withholding loans to businesses, but by cutting dividends and bonuses.

While all eyes are fixed on Italy's ever-increasing borrowing rates, a far larger problem may well be emerging. The EU bailout fund, set up to help countries who can't borrow, may itself have trouble borrowing very soon. A sale this morning of 10-year bonds by the European Financial Stability Facility (EFSF) had a very muted response, barely bringing in the €3 billion it was meant to. This despite the fact that the offer was priced at a much more enticing yield, some 90 basis points (or 0.9 percentage points in non-market lingo) above a previous sale. Mind you, that's better than last week's sale, which had to be postponed due to lack of interest. The EFSF was set up as a fund that lends to eurozone companies that are finding it hard to raise money.