Geopolitics

Gaza-Israel Ceasefire Brokered By Egypt's Morsi

JERUSALEM POST (Israel), NOUVEL OBSERVATEUR, AFP (France), REUTERS (U.S.), AL JAZEERA (Qatar), AHRAM ONLINE (Egypt), LIBERTÉ ALGÉRIE (Algeria)

Worldcrunch

JERUSALEM - An informal ceasefire brokered by new Egyptian President Mohamed Morsi was holding in most places Thursday between the Palestinian group Hamas and the Israeli army, the Jerusalem Post reported.

The truce comes after three days of cross-border violence, that included 80 rockets and mortar fire fired from Gaza into southern Israel and Israeli air raids over Gaza. Seven Palestinians, including four fighters, have been killed and 13 women wounded since Monday, while in Israel, six people were hurt within 24 hours.

Hamas has controlled Gaza since 2007, but Gaza gets almost all its supplies through Egypt, so the Egyptian government has a large influence there. There is a single passage between Gaza and Israel and it has been blocked because of the violence, stranding dozens of people, especially hospital patients. This weekend is a major Muslim festival, the Aid Al-Adha, which may have helped bring on the pause in hostilities.

“An official close to the talks” said the Hamas leadership gave an oral promise to the Egyptians to observe the ceasefire, Reuters reported, while Israel agreed not to fire into Gaza unless fired upon.

Meanwhile, Israeli Vice Premier Silvan Shalom told Israeli radio that Morsi is tougher toward Hamas than the previous Egyptian government was. “It's good for the public to know that the current leadership is acting against Hamas in a very tough way,” Shalom said.

Morsi also told Palestinian news agency Paltoday that “We will never accept any assault or siege on the Palestinian people,” the Jerusalem Post added.

AFP reports that Morsi said: “Supporting Palestine does not mean that we will declare war against anybody.” According to Egyptian news site AhramOnline, Morsi has not mentioned Israel by name since becoming president.

Each side had blamed the other for the increased fighting Tuesday and Wednesday. Hamas condemned the “Zionist aggression” that it said was an “attempt to spoil the joy of Palestinians after the historic visit of the emir of Qatar.”

The visit had been the first by a head of state since Hamas took power in 2007. The emir has also met with Israeli leaders in the past. In his visit, he promised $400 million of aid to Gaza. Liberté Algérie points out that this visit strengthened the hand of Hamas, and violated the agreement of the Arab League and the international community not to recognize Hamas.

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Society

Debt Trap: Why South Korean Economics Explains Squid Game

Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.

In the Netflix series, losers of the game face death

Yip Wing Sum

-Analysis-

SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.

The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.


It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.

Seoul housing prices top London and New York

In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.

According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.

Average home loans are equivalent to 270% of annual income.

One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.

According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.

Playing the stock market

At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.

A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."

In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.

42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s

Simon Shin/SOPA Images/ZUMA

Game of survival

In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.

But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.

This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.

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