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Wall Street Journal số ra ngày 28/2/2014
DJIA 16272.71 À 0.46% Nasdaq 4318.93 À 0.63% Stoxx Eur 600 337.21 g 0.15% FTSE 100 6810.27 À 0.16% DAX 9588.33 g 0.76% CAC 40 4396.39 g 0.01% Euro 1.3718 À 0.36% Pound 1.6688 À 0.24% Who’s Your Money On? PLUS: Will Lyons on releasing the potential of Barolo EUROPE EDITION VOL XXXII NO 21 $1.75 (C/V) - KES 250 - NAI 375 - FRIDAY - SUNDAY, FEBRUARY 28 - MARCH 2, 2014 £1.70 WSJ.com Ukraine Roiled by Challenges From East Kiev Is Looking In All Directions For Financial Aid Dozens of armed men took over two government buildings in a restive, pro-Russia region of Ukraine and the ousted president broke his nearly weeklong silence, declaring himself still to be the Ukraine’s new government on Thursday set in motion requests for international financial assistance as it attempts to cement its standing following the removal of the country’s president last weekend By Lukas I Alpert in Moscow and Paul Sonne in Simferopol, Ukraine By Andrey Ostroukh in Moscow, Ian Talley in Washington and Laurence Norman in Brussels country’s legitimate leader Both developments posed serious challenges to the provisional government as it tries to consolidate control In a statement provided to Russian news agencies Thursday, deposed President Viktor Yanukovych said that the vote in parliament last week to strip him of his powers was illegal and that he remained president Arseniy Yatsenyuk, who was confirmed as prime minister in parliament Thursday, countered that Mr Yanukovych is “no longer president, but a wanted man suspected of mass murder and crimes against humanity,” the Russian news agency Interfax reported Mr Yanukovych also asked Reuters Yanukovych Says He Is Still There; Unrest in Crimea Supporters of Russia rally outside the regional parliament Thursday in the Crimean capital, where armed men occupied two buildings Russia to ensure his personal safety “against the actions of extremists.” Russia responded by agreeing to provide security to Mr Yanukovych within Russian territory, Russian state news agencies reported, citing unidentified government officials Mr Yanukovych hasn’t been seen publicly since Saturday Feb 22, when he was Gold Bulls Come Back After Last Year’s Rout BY TATYANA SHUMSKY AND IRA IOSEBASHVILI Investors are buying gold again Gold is up 11% this year, and wagers on rising prices are at a four-month high in the futures market In February, investors were net buyers of SPDR Gold Shares, the biggest exchange-traded fund that buys gold, for the first time since December 2012 Gold has a long way to go to recover from last year’s rout, the metal’s worst annual performance in more than three decades Gold futures ended Thursday at $1,331.60 a troy ounce on the Comex division of the New York Mercantile Exchange, up slightly for the day but down 16% from a year ago Some money managers are betting that the market hit bottom at the end of 2013 Risky assets that drew cash away from gold last year, including emerging-market stocks and bonds, are looking less appealing Gold is also regaining its role as a hedge against inflation as some investors question the U.S Federal Reserve’s commitment to ending its economic stimulus “A reset needed to happen in gold,” said Michael Tidemann, who manages $8.5 billion for 130 clients at Tidemann Wealth Management in New York Like many investors, Mr Tidemann sold gold in Decem- ber to lock in losses for tax purposes However, he started buying shares of SPDR Gold Shares in January and is recommending that new clients hold gold He said he sees gold as a store of value should the Fed’s stimulus policies trigger higher inflation or a weaker dollar SPDR Gold Shares, known by its ticker symbol GLD, has added 10.54 metric tons to its gold holdings for February through Wednesday, boosting its total to 803.7 tons Still, the month’s increase is dwarfed by last year’s decline of 552.6 tons Investors have had plenty of reason to buy gold in the past few months Doubts Please turn to page 19 driven from office following a week of bloodshed in Kiev that left more than 80 dead Russia had been muted in its support of Mr Yanukovych since then, although officials Inside have argued that the government taking form in Kiev gained power illegally Russian President Vladimir Putin, who had backed Mr Please turn to page Cypriot President Nicos Anastasiades sees an end to capital controls by the end of this year Interview Opinion: A somber wariness in Ukraine 13 Missing in Barcelona: Genuine Innovation BY SAM SCHECHNER A new generation of Italian designers teased up their looks to bring a sexy spirit back to the runways Personal Journal 25 The move comes amid growing pressure on the Ukrainian government’s finances, with the currency falling sharply in recent days and foreign-exchange reserves declining Ukraine hopes to secure a bailout from the International Monetary Fund, Russia and other countries willing to offer aid Ukraine’s newly appointed finance minister Oleksandr Shlapak said Thursday that the government will seek at least $15 billion in aid from the IMF The IMF separately said it Please turn to page BARCELONA—The hottest showcase for new technology at this year’s Mobile World Congress wasn’t ANALYSIS in the event’s cavernous exhibition halls It was actually about kilometers away, at an affiliated show for startups and venture capitalists In a makeshift array of stages, geodesic tents and seats made from beer crates, organizers of the spinoff gathering titled Four Years From Now, or 4YFN, played host to an array of mobile-related startups with products like GPS for motorcycle helmets, and an application for Google Inc.’s computer-enabled glasses that lets users buy things with a nod of the head “This is where the real innovation happens,” said Christopher Pommerening, co-founder of venture-capital firm Active Venture Partners, as a rock band blared on a nearby stage “Over there, innovation means having a phone that is a millimeter smaller than last year’s.” Innovation has been hard to come by in Barcelona this year At over one million square feet, Mobile World Congress is the mobile industry’s biggest yearly conference But this year’s show offered another cascade of glass-slab devices that varied in size and, maybe, color That stagnation reflects a broader shift in the mobile business, as the smartphone revolution nears the end of its Please turn to page 16 | Friday - Sunday, February 28 - March 2, 2014 AM IM UK SW FR IT SP TK BR PL IS AE THE WALL STREET JOURNAL GR PAGE TWO House of Shards What’s News— i i i i i An aggregation of national polls shows no group winning a clear majority in the next European Parliament, which will further complicate the selection of a new president for the European Commission, the EU’s executive arm Alliance of Liberals & Democrats for Europe Group i Business & Finance n Allianz SE backed the new management team at Pacific Investment Management Co., even as the performance of the U.S fund manager weighed on the German insurer’s fourthquarter earnings 15 The Greens World-Wide n Cypriot President Nicos Anastasiades said all capital controls on the island would be lifted by the end of the year n Royal Bank of Scotland announced a plan to cut about £5 billion ($8.3 billion) in costs over the next four years as the state-controlled bank posted its second-largest ever full-year net loss 15 n The European Commission has sent a complaint to Telefónica over its bid for the German unit of Royal KPN, raising the specter of tough regulatory obstacles to consolidation in the telecom sector 15 n Gianni Versace SpA agreed to sell a 20% stake to privateequity firm Blackstone Group LP in a deal that aims to fund growth at the Italian fashion house and could prompt a public offering in a few years 17 n WPP PLC became the latest firm to be hit by turmoil in emerging-market currencies, which weighed on profit margins and prompted a cautious outlook for the year ahead 18 n A record $14 million whistleblower award paid by the SEC last year was for a tip about an alleged Chicago-based scheme to defraud foreign investors seeking U.S residency, according to people familiar with the payment 21 European United LeftNordic Green Left 70 56 European Conservatives & Reformist (EU-skeptic) 200 42 30 February poll 751 seats Europe of Freedom & Democracy (far right) Other 92 Note: During the last European elections, PollWatch correctly predicted 98% of seats won by each political group Source: Polls from all 28 EU member states conducted in the two weeks leading up to Feb 19 and aggregated by PollWatch n Federal Reserve Chairwoman Janet Yellen said the Fed might consider a pause in its reduction of bond buying if the recent deterioration in U.S economic growth persists The Wall Street Journal ReadyorNot,HereComes TheNextBrusselsLeader n Spain’s regional and central governments may have to refund as much as €13 billion ($17.8 billion) in fuel tax to consumers and businesses after the European Union’s highest court said the tax violated European law [ Brussels Beat ] BY GABRIELE STEINHAUSER n Colombia’s finance minister said some $12 billion in investment on infrastructure projects this year will boost this Andean country’s gross domestic product n The new conservative government, under pressure to rein in its budget, will review plans to double Australia’s fleet of submarines n Germany wants Britain to be a strong player in the EU, Angela Merkel told U.K parliamentarians, stressing that its membership was needed to help Europe be competitive Photos: James Marson (left), Paul Sonne (right) What’s Online http://graphicsweb.wsj.com/crimeas-challenge/ 44 217 n North Korea launched four short-range missiles into the sea off the eastern coast of the Korean peninsula, stirring tensions after a naval incursion earlier this week Explore the tumultuous history of Crimea in our interactive graphic European People's Party (conservative) Progressive Alliance of Socialists & Democrats Usually, the biggest question ahead of any vote is who is going to win But for this May’s European elections, there’s another issue: What are the parties and their candidates trying to win? In the last European election in 2009, the answer to the second question was clear—parties wanted to gain seats in the European Parliament that would help them shape new laws This time around, the answer isn’t so obvious That’s because mainstream European parties, including the center-left Party of European Socialists and the center-right European People’s Party, or EPP, are for the first time each appointing a candidate to head their campaigns These so-called lead candidates aim to more than bring out votes across the European Union’s 28 member states They are seeking a personal prize: to become the president of the European Commission, the EU’s executive arm and the only institution with the right to initiate policies Until now, the commission president has been selected by the bloc’s prime ministers and presidents in closed-door meetings after parliamentary elections, with the new parliament getting only a yes-or-no vote Giving voters more say on who gets the EU’s top job seems like a smart move at a time when the bloc is facing a legitimacy crisis after years of economic turmoil Yet the way this new system is unrolling threatens to confuse voters “If you try to introduce an element of direct democracy into the system without doing it properly it will look like a stitchup,” says Heather Grabbe, director of EU affairs at Open Society Foundations, a pro-democracy pressure group The biggest problem with modeling the selection of a new commission president after the way a prime minister is chosen in parliamentary democracies such as the U.K or Germany is that this new process hasn’t been endorsed by EU leaders Some, including Germany’s Chancellor Angela Merkel, have openly questioned the link between lead candidates and the top commission job That matters because EU leaders still have to nominate the new commission president and send that person and other commissioners for approval to Parliament While the legislature can block their appointments, there is no legal obligation for leaders to select a winning candidate The results of this indecision have been obvious as European parties select their candidates No high-profile sitting politicians have been willing to give up their posts for the insecurity of having to win an election and then risk seeing it ignored by EU leaders As a consequence, when Europe’s top Socialists travel to Rome this weekend to formally appoint their lead candidate, the only contender will be Martin Schulz, the little-known president of the European Parliament, who faces skepticism even among those in his own party in Germany, the Social Democrats At the EPP’s congress in Dublin next week, center-right delegates will choose between former Latvian Prime Minister Valdis Dombrovskis and Jean-Claude Juncker, the former prime minister of tiny Luxembourg The small crop of contenders isn’t the only symptom of the uncertainty over the new system The candidates themselves have been hazy on what position they’re actually running for “Currently we’re talking about president of the European Commission,” Mr Dombrovskis said last week when asked whether he would be content with another top job at the commission Similarly, when Ms Merkel’s party, the Christian Democrats, endorsed Mr Juncker earlier this week, it made no mention of the commission Yet, despite the lukewarm response to the idea of an elected president, the process may already be too far along to stop In Rome and Dublin, national party leaders will take the stage alongside their lead candidates—a photo opportunity that may be hard to erase when the election results come out on May 25 “In my opinion, the train already left months ago,” says Kostas Sasmatzoglou, the EPP’s campaign manager Brian Synnott, his counterpart at the European Socialists, said, “This is really happening.” They have already scheduled two debates between lead candidates that will be shown live on major national broadcasters and believe big channels in Germany and France may even want to stage their own debates “When the media starts writing about them, they suddenly have a back story,” Simon Hix, professor of European and Comparative Politics at the London School of Economics and Political Science, says of the candidates Whether coverage picks up beyond broadsheet newspapers and political television shows will mostly depend on whether national parties embrace their candidates in their own campaigns The EPP has only about €1.6 million ($2.2 million) to promote its lead candidate, not enough to run TV spots or newspaper ads The Socialists, says Mr Synnott, have even less SUBSCRIBE TODAY CALL +44 (0) 20 3426 1313 VISIT wsjeuropesubs.com/wsje THE WALL STREET JOURNAL EUROPE (ISSN 0921-99) 222 Grays Inn Road, London, WC1X 8HB FOR ISSUES RELATED TO SERVICE: CALL +44 (0) 20 3426 1313 EMAIL subs.wsje@dowjones.com WEB service.wsje.com Advertising Sales worldwide through Dow Jones International Frankfurt: 49 69 29725 390; London: +44 20 7573 4060; Paris: 331 40 17 17 01 Printed in Belgium by Concentra Media N.V Printed in Germany by Dogan Media Group / Hürriyet A.S Branch Germany Printed in Switzerland by Zehnder Print AG Wil Printed in the United Kingdom by Newsprinters (Broxbourne) Limited, Great Cambridge Road, Waltham Cross, EN8 8DY Printed in Italy by Telestampa Centro Italia s.r.l Printed in Spain by Bermont S.A Printed in Israel by Jerusalem Post Group Printed in Turkey by Dunya Super Veb Ofset A.S Printed in Poland by Polskapresse Printing Division Registered as a newspaper at the Post Office Trademarks appearing herein are used under license from Dow Jones & Co ©2013 Dow Jones & Company All rights reserved Editeur responsable Tracy Corrigan M-17936-2003 Registered address: Avenue Cortenbergh 60, 1040 Brussels, Belgium THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | NEWS Venezuelan Rebellion Spawns Folk Hero Former General Who Resists Arrest Gains Support in Deeply Split Nation; ‘He’s a One-Man Military Rebellion’ CARACAS, Venezuela—A gun-toting retired Venezuelan general has become a folk hero to the country’s opposition and galvanized a protest movement by defying the government of President Nicolás Maduro, engaging in a Rambo-like standoff with security forces sent by the president to arrest him Angel Vivas has been holed up in his home in a hilly Caracas suburb since last weekend, when Mr Maduro, on live television, ordered his arrest for having backed student protests that have convulsed this oil-rich nation When black-clad officers from military intelligence went to the retired Army general’s house Sunday morning, he emerged wearing a flak jacket and armed with a semiautomatic rifle and pistol, warning that the only way he would be taken was in a body bag Scores of neighbors came out in support of Gen Vivas and heckled security forces, who eventually backed down “I have a right to self-defense,” Gen Vivas said in an interview inside his bunkerlike home, which is decorated with family pictures and mementos to his 40-year career in the army, including old rifles and swords “At no time did I order anyone to commit violence,” he said, after the government said his tweet giving defense advice caused a death “I was helping unarmed civilians defend themselves….A priest recommends prayer, a doctor recommends medicine, a military man recommends how to defend.” In the days since, Gen Vivas has become an inspiration to many of the protesters, who have risen up in past weeks against what they see as an increasingly authoritarian government and an economy savaged by high inflation and scarcity The violence has killed more than a dozen people, mostly protesters shot by either security forces or pro-government militias, opposition members say Venezuela’s Attorney General’s office said Wednesday it had arrested five members of the state intelligence division Sebin for their alleged involvement in the deaths of two protesters Gen Vivas’s Twitter account, where he regularly blasts the Maduro government as “illegitimate” and a stooge for Cuba, which has close ties to Caracas, surged to 233,000 on Wednesday from some 50,000 followers on Saturday His 16-year-old daughter Natalia’s account went to 15,000 followers, from 200, after she posted YouTube videos of the standoff “He has the guts that a lot of people lack,” said Anessa Cafferata, a 21-year-old engineering student who takes part in daily protests across the capital “He’s protecting his home, and we students are protecting the country.” The short and stocky 57-year-old general symbolizes some of Venezuela’s deep divisions that have only hardened in recent weeks as protesters—largely backed by the middle and upper class—square off against a populist government In the upper-middle class enclave where the general lives, there is little affection for the government, blamed for a crumbling economy where ordinary goods are scarce on store shelves One neighbor com- Associated Press (top); Reuters BY DAVID LUHNOW AND EZEQUIEL MINAYA Above, neighbors of retired Army General Angel Vivas block their Caracas street with a makeshift barricade to try to protect him from arrest Right, Gen Vivas stands outside his house with an automatic weapon and wearing a flak jacket plained that he went four months without toilet paper Another said car batteries were now a favorite target for thieves because Venezuela lacks the dollars to import new car batteries The local school has been closed for two weeks due to the protests Neighbors take turns standing guard outside the general’s home, ready to raise the alarm if the government returns to arrest him Access to the neighborhood is cut off by barricades manned by protesters, who have piled garbage, old tires and tree branches at main intersections to stop government officers from returning Several former senior military officers also stopped by the general’s home in a show of support “He’s a one-man military rebellion,” said Ivan Monroy, an amateur historian who visited the general’s house this week to deliver a copy of his book None of the neighbors wanted to say their full names, fearing reprisals from a government that in the past has fired public employees for supporting the opposition and in recent weeks jailed opposition leader Leopoldo López for supporting the protests Several former senior military officers also stopped by the general’s home in a show of support, including Fernando Ochoa Antich, who was defense minister during the failed 1992 coup by then-Lt Col Hugo Chávez, who eventually went on to win the presidency and rule for 14 years until his death last year from cancer “He’s making a heroic stand,” said Mr Ochoa, who came along with three other retired mili- tary men to chat with Gen Vivas, whose neighbors awarded him the moniker of “Rambo.” Venezuela’s army has a long history of political activism In 2002, army and navy officers briefly booted Mr Chávez from power, but he returned thanks to massive support from the poor and parts of the army that disagreed with the coup Mr Chávez then purged the military Venezuela’s state-run television, and private broadcasters who back the government, have criticized Gen Vivas Retired Lt Esaul Olivar, who heads a group calling itself Military Revolutionary Front, called him a “traitor” on state television and said he was trying to organize a coup Experts say the military is likely to stay on the sidelines of the current showdown between protesters and the government, but that it would become increasingly disgruntled if called on to use widespread force against civilians “When you speak with some active officers, they express their discontent; they not like the politicization of the military,” said retired Gen Raul Salazar, who was Mr Chávez’s first defense minister but who is now seen as opposition-leaning “But, of course, there is fear of speaking out.” Gen Vivas first gained prominence when he refused orders from Mr Chávez to have his troops use the Cuban slogan “Patria o Muerte, Venceremos,” translated as “Fatherland or Death, We Will Overcome.” Instead, the general stepped down from his post in 2007 Ever since, he has used the Internet as a soapbox to decry what he sees as Cuba’s takeover of Venezuela’s military and other institutions Gen Vivas came of age in the military at a time when Cuba was seen as the enemy for having backed two small-scale guerrilla invasions in 1967 that led to several years of violent fighting “We fought against them for eight years, and then Chávez handed the country over to them,” he said Gen Vivas calls Cuba a “terrorist” state, and Mr Maduro the Cuban “pro-consul.” When the wave of student protests started a few weeks ago, Mr Vivas took to YouTube and posted a long rant urging active duty officers not to fire at protesters On Twitter, he offered practical advice on how to defend against attacks, particularly by gangs of pro-government thugs on motorcycles that were blamed for the shooting deaths of several protesters The general recommended stringing up nylon or wire across streets to prevent riders from crossing Venezuela’s government says a 21-year-old died last Saturday after getting knocked off his motorcycle late Friday by one such trap The government quickly blamed the general for the death “I have given the order to seek out the retired general, Gen Angel Vivas, who called for these tactics and trained these fascists Get him and bring him in Murderer!” Mr Maduro told a rally of supporters last Saturday Gen Vivas was gardening when his wife rushed outside and told him, “The president is talking about you on TV He’s ordering your arrest.” The general says he and his family prayed, and then decided he would resist arrest He took to Twitter and sent a flurry of messages “This genocidal dictatorship wants me to surrender and hand me over to Fidel Castro I WILL NOT SURRENDER!” he wrote Gen Vivas’ lawyer, Mercedes Contreras, said the officials had no proper arrest warrant “The only way you’re getting in here is with a letter signed by Pope Francis,” she says she told them Then the general reappeared, toting a Colt 223 semiautomatic rifle, several bands of ammunition and a holster carrying his Beretta 9mm pistol He said goodbye to his family, and gave a long soliloquy, invoking his pledge to defend Venezuela from foreign enemies and said the men were being used as tools by the Cuban government The crowd of neighbors erupted in applause One began shouting at a dark-skinned agent that he was really a Cuban in disguise 4| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL UPHEAVAL IN UKRAINE Interim Government Under Pressure Crimea at a Glance The Black Sea peninsula belonged to Russia until 1954, when Soviet authorities transferred it to the then-Soviet republic of Ukraine From 700 BC Greeks settle along the coast of Crimea; their colonies are subsequently absorbed into the Roman Empire The peninsula is later overrun by a succession of nomadic tribes Merchants from Venice, then Genoa, control main trading posts 100 miles CRIMEA Sevastopol Home of Russia’s Black Sea Fleet 1441 Tatars, ruled by descendants of Genghis Khan, establish Crimean Khanate, a protectorate of the Ottoman Empire 100 km Simferopol Black Sea Share of Yanukovych voters from 2009 election Sevastopol Crimea National 1783 Russia, under Catherine the Great, annexes the Khanate, and establishes a naval base at Sevastopol 84% 78 49 1854 Britain, France and the Ottoman Empire launch Crimean War to thwart Russian ambitions The Charge of the Light Brigade at Balaclava, and the yearlong Siege of Sevastopol, are immortalized by Tennyson and Tolstoy Ethnic breakdown Ukrainians 24.4% Crimean Tartars 12.1% Others 5% Russians 58.5% Total population of Crimea million Source: Ukrainian Census & Election Commission Crimea has become the flashpoint for a backlash against the pro-Western protesters that drove Mr Yanukovych from power Despite the occupation of the local parliament, Crimea’s legislature met Thursday to fire the government and called a regionwide referendum on May 25 to vote on further autonomy from Kiev “They are accusing us of separatism But we have a feeling that they want to separate from us,” said the parliament’s speaker, Vladimir Konstantinov “The Crimean parliament is the only legitimate institution in Crimea.” Anatoly Mogilyov, the chairman of Crimea’s Council of Ministers, said the gunmen were asked to leave the buildings but refused, saying they weren’t authorized to negotiate A possible outbreak of violence in the region has led to worries about Russian military intervention Russian officials have said there are no plans to so, but others have said Russia has an obligation to protect its military installations and citizens if need be On Wednesday, President Putin ordered military preparedness testing for 150,000 Russian soldiers, including some stationed not far from the Ukrainian border Adding to the uncertainty, Ukrainian officials said Russian armored European Pressphoto Agency Continued from first page Yanukovych, has made no public comment on Ukraine since the government there collapsed His spokesman didn’t respond Thursday to calls seeking comment Mr Yanukovych’s whereabouts wasn’t immediately known and it wasn’t possible to verify whether the statement was authentic Two of Russia’s leading news agencies said they had received the statement from an aide for Mr Yanukovych, but declined to provide a copy Neither said they had seen Mr Yanukovych Interfax later reported, citing a source close to Mr Yanukovych, that he would hold a news conference late Friday in Rostov-on-Don, a Russian city close to Ukraine and the Black Sea Hours earlier, dozens of armed men took control of the parliament and a nearby executive building in the capital of the Ukrainian region of Crimea, barricading themselves inside and raising a Russian flag above the building Ukraine’s acting interior minister, Arsen Avakov, said the country’s military and police had been put on alert Taken together, the moves raised the volume on threats of secession in Ukraine’s eastern regions, which are dominated by ethnic Russians, and where Mr Yanukovych drew most of his support Some more hard-line Russians in Crimea—a Black Sea peninsula that belonged to Russia until 1954 and retains a degree of autonomy—are demanding that the region secede or once again become part of Russia Crimea also is home to Russia’s Black Sea Fleet In his statement, Mr Yanukovych said that people in Crimea and across Ukraine’s southeast “don’t accept the anarchy and lawlessness in the country,” nor they want a new government elected by “a mob in a square.” His reference was to Kiev’s Independence Square, where the pro-European uprising was centered Protesters remain gathered there and have been weighing in on the selection of a new government “I officially declare my intention to fight to the end for the implementation of important compromise agreements to bring Ukraine out of its deep political crisis,” he said, referring to a pact reached with the political opposition, brokered by European diplomats, on Feb 21—a day before he fled Kiev Storied Past Crimea’s turbulent history New Prime MInister Arseniy Yatsenyuk, left, speaks Thursday with Vitali Klitschko, another former opposition leader, during a parliament session in Kiev personnel vehicles were detected outside their naval base in the Crimean port of Sevastopol Russia’s Deputy Defense Minister Anatoly Antonov was quoted later as saying that the Black Sea Fleet is not threatening Ukraine “Currently, all formations and units are doing their daily activities, including those associated with combat training Such actions pose no threat There are no legal limitations on that,” the minister told reporters, according to Interfax Deposed President Viktor Yanukovych called parliament’s vote last week to strip him of his powers illegal He also was quoted as saying that “places of deployment, personnel numbers and the number of weapons” are well below levels allowed under a 1997 agreement over the base with Ukraine A group of Russian parliamentarians also arrived in Crimea to assess the situation, Russian officials said Sergei Mironov, leader of the pro- Kremlin Just Russia party, who was among the group, said, “Everyone should know that Russians don’t abandon their own during wartime and it looks like things are headed for war.” Ukraine’s acting President Oleksander Turchynov warned against any breaches of Ukrainian territory by Russian military forces, particularly those stationed in Sevastopol, which he said would considered an act of aggression The seizure of the two buildings came a day after dueling demonstrations erupted outside the parliament between thousands of pro-Russian protesters and Crimean Tatars, who had backed the protest movement that forced Mr Yanukovych from power The occupation drew deep concern in the West, with the top official from the North Atlantic Treaty Organization, Anders Fogh Rasmussen, calling it “dangerous and irresponsible.” He said that “I urge Russia not to take any action that could escalate tension or create misunderstanding.” Russia’s Foreign Ministry said in a statement that NATO’s focus on Ukraine “sent the wrong message” and it “strongly advised” the organization to respect Ukraine’s neutrality 1941-42 In another epic siege, Sevastopol holds out for eight months before falling to the Nazis 1944 After liberating Crimea, Stalin orders the deportation of Crimea’s 200,000 Tatars on a false pretext of having collaborated with the Nazis According to Tatar estimates, over 40% of the deportees die en route or in exile 1954 Nikita Khrushchev, Stalin’s successor and a Ukrainian, orders the transfer of Crimea to the Ukrainian Soviet Socialist Republic, after a mere 15 minutes of discussion in the Communist Party’s central committee 1991 Ukraine becomes independent of the U.S.S.R Crimea, excluding the municipality of Sevastopol, becomes an autonomous republic of Ukraine Tatars begin to return 1997 Russia and Ukraine divide the Soviet Black Sea Fleet Russia gets to lease the Sevastopol naval base for a minimum of 20 years 2010 Russia and Ukraine extend lease on Sevastopol base to 2042 2014 Armed men proclaiming loyalty to Russia take control of the Crimean parliament in the capital, Simferopol after the ousting of President Yanukovych Kiev Looking In All Directions for Financial Assistance Continued from first page received a bailout request from Ukraine “We are ready to respond and in the coming days will send an IMF fact-finding mission team to Kiev to undertake a preliminary dialogue with authorities,” IMF managing director Christine Lagarde said in a written statement She said the IMF is in talks with other countries as part of a larger financing package Meanwhile, Russian President Vladimir Putin ordered his government to consult with foreign capitals and the IMF on aid for Ukraine, the Interfax news agency quoted his spokesman as saying late Thursday Russia suspended a $15 billion aid package for Kiev after pro-Russian President Viktor Yanukovych was deposed last week by pro-Western demonstrators Russia doesn’t recognize the new government in Kiev, and there was no indication that the Kremlin would lift the suspension of its own money But Western officials have said that Russia must be part of any new assistance package Mr Putin ordered his government to continue talks on building trade ties with Ukraine Russian officials in recent days have threatened to limit Ukrainian imports if Kiev draws closer to Europe The IMF aid request came shortly after an interim government was appointed in Ukraine Mr Shlapak, the new finance minister, said that he would continue talks with Russia about credit line extensions and a discount on gas supplies Ukraine is seeking aid to help it pay existing foreign debt, finance reforms and stabilize its currency, the hryvnia Officials engaged in discussions with Ukraine said the country needs $4 billion immediately By the end of 2015, Ukraine hopes to raise some $35 billion The European Union and the U.S are exploring aid packages—both short-term and longer-term—but some of the assistance will likely be linked to an IMF loan deal being agreed upon first “We are looking to provide immediate assistance for urgent needs in the next couple months, in close cooperation with an IMF reform package In the medium term we will also look into combined international efforts in support of bigger reform programs,” a senior EU diplomat said Among the short-term options under review by the U.S and EU are small bilateral bridge loans, loan guarantees and a short-term emergency credit line from the IMF that isn’t tied to the strict conditions a large-scale bailout requires Ms Lagarde said the IMF would first assess the economic situation and Ukraine’s needs and start discussing with the transitional government “the policy reforms that could form the basis of a Fund-supported program.” The IMF has said it would require extra conditions for any bailout because of the failure of Kiev to live up to previous financing program requirements IMF spokesman Gerry Rice said Kiev has indicated it will commit to wide-ranging changes as part of its bailout request Mr Rice said he couldn’t address possible timing of an IMF bailout or whether the fund would consider a short-term emergency credit line in the meantime The IMF has previously pushed for Kiev to depreciate its currency, phase out fuel subsidies and tighten government spending On Wednesday U.S Secretary of State John Kerry said Washington could provide some $1 billion in loan guarantees for Ukraine to help the economy The EU is also exploring a number of steps—from possible financial assistance to help with energy security and improved market access—in parallel to an IMF-led international package Mr Yanukovych was in talks with the IMF for much of last year concerning extending a loan program but he rejected the Washingtonbased lender’s demands that Ukraine cut energy subsidies and devalue its currency THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | EUROPE NEWS Cyprus to End Capital Controls President Says Curbs to Be Lifted by End of Year; Government Dealt Setback on Privatizations BY MATINA STEVIS Associated Press BY LAURENCE NORMAN Cypriot President Nicos Anastasiades said in an interview that resolving Cyprus’s partition could help spur the economy 6% last year and is set to lose another 4.8% of its output this year according to the European Commission That drop, though sharp, is less than had been forecast a year ago Nonetheless, signs of financial trouble are plain to see On Archbishop Makarios Avenue, the main commercial road in the capital Nicosia, roughly every other is closed and for-rent signs are a fixture Mr Anastasiades said the recent resumption of talks to resolve the island’s partition provided hope for the economy Turkey invaded in 1974 following a coup attempt aimed at unifying the island with Greece The coup failed but Turkey has controlled the northern third of the island ever since “The solution to the Cyprus problem is, I believe, an important factor in the recovery of our economy It can boost the recovery,” he said Since a plan to reunite the two communities was resoundingly rejected by the Greek Cypriots in a referendum in 2004, talks have been intermittent and fruitless But there is optimism here that this time may be different Mr Anastasiades and the Turkish Cypriot leader Dervis Eroglu issued a joint declaration in February setting out a new road map for talks, in the presence of U.S Deputy State Secretary Stopping the Stampede Capital controls imposed during Cyprus’s financial crisis sharply curtailed how much cash depositors could take out of the country Net outflows from Cypriot banks, in billions €4 ▼ NICOSIA—Cypriot President Nicos Anastasiades said all capital controls on the island would be lifted by the end of the year, a step that would remove a symbol of his country’s isolation from the rest of the euro area The controls have been in place almost a year, since Cyprus agreed to a €10 billion ($13.7 billion) bailout from its European partners and the International Monetary Fund in March 2013 “The timeline is that we’ll lift internal restrictions very soon, and for all other banking activities—including with abroad—by the end of the year,” Mr Anastasiades said this week in an interview with The Wall Street Journal In a separate interview, Finance Minister Harris Georgiades said that restrictions on internal transactions would be lifted in April Cypriot banks underwent an unprecedented overhaul as part of the bailout process: the second-largest was closed and the largest radically restructured To pay for the fallout, big depositors were “bailed in,” meaning part of their deposits were converted into bank shares The country’s once-dominant financial sector is still threatened Officials from the so-called troika of lenders—the European Commission, the European Central Bank and the International Monetary Fund— estimate that about 45% of all loans are nonperforming That means that payments on the loans haven’t been made for three months, with the ratio at Bank of Cyprus, the island’s largest, being 50% Mr Anastasiades is also facing political trouble The governing coalition lost its majority in parliament this week when the junior partner withdrew On Thursday, lawmakers narrowly rejected a bill to privatize the state-owned power, telephone and ports companies—a key condition of the bailout—after days of strikes and street protests by angry workers Government lawmakers were searching afterward for a compromise that could allow a fresh vote on the bill in the coming days However, the loss of the coalition partner will require a cabinet shuffle The Cypriot economy shrunk by Spain Must Pay Back Fuel Tax, Court Rules March 27, 2013: Capital controls introduced 2013 ’14 Source: Central Bank of Cyprus The Wall Street Journal for Europe Victoria Nuland “There are so many benefits for all those involved,” Mr Anastasiades said, noting especially the potential to exploit offshore natural-gas deposits, which could be exported to Turkey through a pipeline For that to happen, Turkey would have to recognize Cyprus, which is unlikely without a solution to the partition of the island The companies exploring the fields off the coast of Cyprus haven’t determined whether it would be worth drilling, in part because sending it anywhere but Turkey could be forbiddingly expensive Phidias Pilides, president of the Cyprus Chambers of Commerce, is throwing his weight behind the new peace talks “If there is an agreement I think it is now clear that the financial advantages are massive,” he said in an interview, citing trade with Turkey, natural-gas exploitation and tourism development on a reunified island A 2008 report by think tank PRIO Cyprus, currently being updated, showed that the “peace dividend” from reunifying the island could raise the real growth rate by percentage points on average for at least the first five years Alex Apostolides, a member of the National Board of financial advisers, said he thinks the benefits would be even larger now, especially because of the gas finds —Alkman Granitsas and Michalis Persianis contributed to this article Spain’s regional and central governments may have to refund as much as €13 billion ($17.8 billion) in fuel tax to consumers and businesses after the European Union’s highest court said the tax violated European law In its ruling Thursday, the European Court of Justice refused to limit the impact of its decision for fear such a refund could threaten Spain’s fragile state finances The court said the central government had been warned repeatedly by the EU’s executive not to proceed with the levy, which was in effect from 2002 to 2012 The case involves what in Spain was dubbed the “health cent”—a tax on gasoline and other petroleumproduct sales levied to help regional governments finance health-care spending Regional authorities were allowed to attach additional taxes The funds collected were used to build hospitals and expand other health-care services The court, following the advice of its advocate general last October, said the tax breached an EU law that seeks to prevent the levying of indirect taxes that create obstacles to EU trade The court said it breaches part of the law that says such taxes should only be levied for a specific, non-budgetary purpose A spokesman for Spain’s budget ministry said that it was unclear how much money the government would have to refund but that it is likely to be much less than the total revenue raised through the tax The country’s tax agency and local courts may have to examine each refund request individually, and only those plaintiffs who can substantiate they paid the tax are likely to have a case, he said The decision comes as Spain’s central government is struggling to rein in its budget deficit The EU said this week that Spain’s fiscal gap was likely to be much higher than its EU-mandated target this year as the economy struggles to rebound from a protracted recession —Ilan Brat contributed to this article Dip in Private Lending Adds to Pressure on ECB BY PAUL HANNON AND TODD BUELL Lending to the private sector in the euro zone fell again at the start of the year, a development that increases the likelihood that the European Central Bank will take further action to support the financial system and growth Adding to the impetus for further stimulus measures, a survey conducted by the European Commission found that consumers’ inflation expectations weakened in February to the lowest since November 2010 The annual rate of inflation in the euro zone was 0.8% in January, well below the ECB’s target of just under 2.0% Figures for Germany and Belgium released Thursday suggested it is unlikely that the rate of inflation picked up in February, and it may have fallen Figures released by the ECB Thursday showed that loans to firms declined by €6 billion ($8.2 billion) after an unchanged reading in December That may come as a disappointment to ECB President Mario Draghi, who said in early February that weak lending toward the end of last year may have been the result of commercial banks holding back ahead of the Dec 31 cutoff for the ECB’s Asset Quality Review “Given hopes that the ECB’s Asset Quality Review had temporarily depressed lending last year, January’s weak euro-zone monetary data will keep pressure on the ECB to loosen policy further,” said James Howat, an economist at Capital Economics The continued decline in bank lending doesn’t appear to have punctured a slow recovery in business confidence The commission’s survey found that businesses across the 18 countries that share the euro were at their most upbeat since July 2011 during February The bolstered confidence in all four business sectors improves the prospect of a pickup in growth this year, since it suggests they will be more willing to invest and hire The commission Thursday said its headline Economic Sentiment Indicator—which measures confidence in a number of business sectors and among consumers—rose to 101.2 from 101.0 to reach its highest level since July 2011 That was a surprise, with the consensus forecast of 17 economists surveyed by The Wall Street Journal last week having been for a decline to 100.5 The pickup in confidence continued to be patchy, with the ESI for Italy surging, while the ESIs for Germany and the Netherlands rose more modestly, and France’s fell “While the weak money and credit growth figures argue in favor of further monetary easing, the sentiment improvement in February gives the hawks on the ECB’s governing council some ammunition to make the case for a continued waitand-see stance,” said Martin van Vliet, an economist at ING Bank However, the measure for consumer confidence fell, in line with a preliminary estimate released earlier this month That contained a warning for the ECB, since the measure for consumers’ expectations of inflation over the next 12 months fell sharply, and now stand at 13.6, well below the average going back to 1990 of 20.7 and at its lowest level since the end of 2010 The ECB has said it is worried by the fact that the annual rate of inflation in the euro zone is well below its target But it has said there is little risk of deflation—or a period of falling prices—as long as consumers don’t expect low inflation rates to continue into the future Germany’s statistics agency Thursday said that measured according to the common European Union methodology, the annual rate of inflation in the euro zone’s largest member fell to 1.0% in February from 1.2% in January That figure will feed into Eurostat’s estimate of inflation for the currency area, which will be published Friday The consensus forecast of 24 economists surveyed by The Wall Street Journal last week was for a reading of 0.7%, down from January and the same level as in October —Monica Houston-Waesch in Frankfurt contributed to this article 6| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL EUROPE NEWS BY WILLIAM HOROBIN PARIS—French actors and musicians took to the streets Thursday to protest proposed changes to their unemployment benefits, the latest pushback against plans to chip away at France’s generous welfare state The protests coincide with negotiations between labor unions and business groups on how to repair France’s heavily indebted jobless-insurance program As part of the talks, Medef, the country’s largest business lobby, has proposed scrapping a system that allows performing artists to receive unemployment benefits for longer and after working a smaller number of hours Ludovic Koutchinsky, who joined demonstrators outside the Louvre, said that without the special treatment, he would have given up long ago on his career as a technician in television “Quite simply, what the Medef is demanding would endanger French cultural production,” he said The CGT union estimated 7,000 people took part in the protests in Paris Police estimates weren’t available The performing artists’ protests underscore the stiff resistance to changing France’s welfare system as the country’s unemployment rate hovers close to a 17-year high of 11% and shows little sign of declining But there is a growing need to overhaul the state-backed unemployment insurance system Its debt is set to reach €22 billion ($31 billion) by the end of the year if nothing is done The beneficiaries of the special program for performing-arts workers make up less than 5% of claimants but account for a large share of the deficits In 2012, they made €240 million in contributions and received €1.32 billion in payouts Labor unions and business groups are responsible for defining the rules of the system that pays out overall €30 billion a year in job- less benefits But the debt ultimately weighs on state public finances and the government, which has to sign off on any changes to the system It has already budgeted for the talks to result in a narrowing of the system’s deficit this year The French system is generous compared with European peers Workers get up to two years of benefits at around 70% of their final salary On average, that works out at just over €1,100 a month, but payments can go up to a limit fixed at just over €6,100 a month In Germany, the maximum monthly payment is less than €2,000, according to Unédic, which manages France’s unemployment insurance system The talks haven’t gotten off to a good start Unions say they can’t agree to such cuts when unemployment is so high and have rebuffed other proposals, such as one that would reduce payouts as unemployment comes down Employers argue the unemployment system should provide the Agence France-Presse/Getty Images French Artists Protest Benefit Cut Plan Performing artists demonstrate against the proposal in Marseille on Thursday same benefits as for other workers unemployed between temporary contracts If the state believes workers in the arts should get extra support, it should directly finance the advantages, the employers say For the moment, the government has sided with performing artists “I advise the Medef not to persist with this error,” French Prime Minister Jean-Marc Ayrault said in a radio interview earlier in February Merkel Urges U.K To Play Strong EU Role U.K Plans To Review Move to Free IRA Suspect BY NICHOLAS WINNING toral threat from the small anti-EU United Kingdom Independence Party, which is threatening to split the right-wing vote in the 2015 general election and make it harder for Mr Cameron to win a second term Mr Cameron has yet to set out in full which areas of Britain’s relationship with Europe he wants to change, and he offered no further clues Thursday Nevertheless, both he and Ms Merkel pointed to an agreement to cut the EU’s budget as an example that change was possible Ms Merkel said the two leaders didn’t get into specifics in their talks but agreed there was common ground in their overriding goals However, she acknowledged that change in the EU wouldn’t be a “piece of cake” and would need the support of all 28 member states “That means that we each stand up for our own interests, I it, David does it…the task is always weighing the pros and cons of a compromise that by nature we have to enter into,” she said, adding that “a lot of hot potatoes have been Reuters LONDON—Germany wants Britain to be a strong player in the European Union, Chancellor Angela Merkel told U.K parliamentarians Thursday, stressing that its membership was needed to help Europe be more competitive Ms Merkel’s six-hour visit to London, during which she had talks and a news conference with Prime Minister David Cameron and afternoon tea with Queen Elizabeth II at Buckingham Palace, attracted little attention in advance in Germany By contrast, it was the focus of keen media interest in Britain for any sign she would comment on Mr Cameron’s plans to give Britons a vote on whether to remain in the EU In the end, she gave little away Germany and Britain have different views on the detail of how the EU should operate, but the two countries shared the same goal of wanting a strong and competitive bloc, she said in a speech to British lawmakers Together, she said, Germany and Britain could defend their economic and social model and bring about necessary overhauls within the bloc “In order to attain this goal, we need a strong United Kingdom with a strong voice inside the European Union,” she said in English after delivering the bulk of her remarks in German “If we have that, we will be able to make the necessary changes for the benefit of all.” Mr Cameron has pledged that if he wins a second term in 2015 he will renegotiate Britain’s ties with the bloc and then hold a national referendum on the country’s membership by the end of 2017 The strategy has raised concerns in other European countries and the business community about the timeline and the possibility that Britain could eventually exit the EU The prime minister has said he wants Britain to remain in a reformed EU But a vocal and rebellious wing of his traditionally euroskeptic center-right Conservative Party believes the U.K would be better off leaving the bloc The prime minister also faces an elec- Ms Merkel and Mr Cameron talk at the British prime minister’s residence at 10 Downing Street in London on Thursday solved in this way.” Ms Merkel’s backing is likely to be crucial to Mr Cameron’s EU reform agenda and referendum bid should he win a second term The two leaders, who are widely acknowledged to have a warm and solid working relationship, looked at ease at the news conference During the afternoon, Mr Cameron tweeted a photo of them sitting on a sofa in what appeared to be the kitchen of his Downing Street residence The contrast with last months visit by French President Franỗois Hollande, who was received by Mr Cameron at an air base and treated to a pub lunch, was palpable Messrs Cameron and Hollande disagreed politely about the future of the EU, and the British prime minister insisting there should be changes to treaties governing the bloc while the French president said it wasn’t a priority and Europe shouldn’t change to suit one country Ms Merkel has called for changes in Europe’s treaties to allow for closer economic coordination and integration among euro-zone countries Britain, which hasn’t adopted the euro, has argued that changes in the euro zone must not jeopardize the European single market or disadvantage the EU members that don’t use the common currency Such changes are an opportunity for the U.K to redraw its ties with the EU, Mr Cameron has said Ms Merkel told the parliamentarians that she was aware of the expectations ahead of her speech, but she was going to disappoint both those who hoped she would say something to support Britain’s alleged or actual wishes for EU reform, and those hoping she would say the rest of Europe wasn’t prepared to pay almost any price to keep the U.K in the bloc Europe’s political structure needed reform so it could fulfill its promise of freedom of opinion, faith and press, Ms Merkel said, as well as freedom of trade, capital and people She also said Brussels should only regulate where member states haven’t passed sufficient regulations themselves, words likely to be well received by British euroskeptics who have long complained of excessive European rules BY NICHOLAS WINNING LONDON—U.K Prime Minister David Cameron looked to head off a possible political crisis in Northern Ireland on Thursday by announcing an independent judicial review into an administrative process that had allowed a man suspected of killing four soldiers in an Irish Republican Army bombing in 1982 to walk free Peter Robinson, the first minister of Northern Ireland’s regional government, welcomed the announcement and said he was withdrawing his threat to resign over the matter He had said Wednesday that he would quit if the government didn’t launch a judicial inquiry The case has highlighted one of the most contentious areas of the peace process in Northern Ireland and similar conflicts around the world: how to hold suspects of sectarian violence to account after peace has broken out Four counts of murder against Irishman John Downey, 62 years old, related to a bomb attack in London’s Hyde Park 32 years ago, were dropped Tuesday after it emerged he had received a letter of assurance from the government that he wasn’t wanted for arrest, questioning or charge in Northern Ireland and the province’s police weren’t aware of any interest in him in the U.K Theresa Villiers, secretary of state for Northern Ireland, said Tuesday that Mr Downey had received the letter in error because he was wanted by London police She said some 200 individuals were given similar assurances, mostly by letter, as part of a process set up by the previous government to deal with so-called on-the-runs— people who believed they might face arrest or questioning in connection with sectarian or criminal offenses in Northern Ireland before the 1998 Good Friday peace agreement Mr Cameron said Thursday that it was clear there had been a dreadful mistake in the Downey case THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | U.S NEWS Food Nutrition Labeling Is Set For a New Look BY THOMAS M BURTON AND ANNIE GASPARRO First lady Michelle Obama said Thursday that newly proposed food nutrition labels will mean consumers will no longer have to ask, “How could this teeny little package contain five servings?” “We’re overhauling these labels to make them easier to read and understand,” Mrs Obama said to an audience of several hundred food-safety advocates at the White House The advantages of the Food and Drug Administration’s proposed new label, she said, include a far larger font display of total calories and more realistic— often larger—estimated serving sizes In recent years, she said, “you squinted at that little tiny label and you were utterly lost You’d ask, ‘Is this too much sugar in this product?’ ” The new label would include a line for “added sugars” to distinguish from sugars that appear naturally in food It would list nutritional values for vitamin D and potassium, which benefit bone health and blood-pressure control Ice cream, which can now have labels listing half a cup as the average serving, would have to list it as a full cup on the new label, and “the calorie declaration will reflect that,” an administration official said The proposed new food-package labels wouldn’t several things that consumer groups had wanted They wouldn’t emphasize in colorful type when added sugars or saturated fat are relatively high in a food Nor would they disclose the percentage of grains that are healthful whole grains The proposed labels, produced by the FDA with input from industry and consumer groups, aren’t slated to take effect for at least two years Industry groups are expected to push for changes, and the proposal is open to a 90-day comment period before being finalized The FDA took the unusual step of also printing up an “alternate” new label that appears potentially more helpful to the average family than the officially proposed one This label specifically lists items where people should “Avoid too Much,” and others to “Get Enough,” along with the daily percentages that food would contribute The alternate label isn’t part of the FDA’s formal proposal But it could serve to gauge whether the public wants more robust changes— and warn the industry that tougher labels aren’t off the table Nutritional labels have remained essentially unchanged since 1994, except for an addition in 2006 of heartrisky trans fats, which appear in some prepared baked goods and microwave popcorn but have been phased out by many companies The Grocery Manufacturers Association, an industry group, said it looks forward to helping with the proposed changes “It is critical that any changes are based on the most current and reliable science,” the group’s president and CEO, Pamela Bailey, said in a statement “Equally as important is ensuring that any changes ultimately serve to inform, and not confuse, consumers.” Consumer advocates have been pushing for changes in what counts as a “serving size,” saying the estimates that are now used are misleading in that they are smaller than what people actually eat in one sitting For example, soft-drink portions are often listed as eight ounces, which means a 20-ounce soda would represent 21/2 servings In the proposed label, administration officials said, a 20-ounce drink would now list that as one serving Darren Seifer, a food-and-bever- Serving sizes would aim to be more realistic The ‘calories from fat’ column would be removed Total calories would appear in a larger font An ‘added sugars’ category would be added Potassium and vitamin D content would be added age analyst at research entity NPD Group, said research on frozen packaged meals found that even when the container was divided into three or four servings, one person was eating all of it He said that changing the serving sizes to better reflect how Americans eat today “might help consumers understand better.” But industry analyst Robert Dickerson of Consumer Edge Research suspects the food companies may argue that if they have to list a whole bag of chips or bottle of soda as one serving, they would reduce the size, and food in smaller packages is more expensive per ounce, so it ultimately takes away value from consumers Food companies—especially soda, ice cream and dessert makers—are expected to take issue with the distinction of “added sugars” on the nutrition label They contend there is no way to distinguish added sugar from natural sugar in testing they conduct to ensure the accuracy of labels Food makers also are expected to push back against having to change their serving sizes, or add a column for nutrition facts for the whole package on larger packages, also part of the proposed changes Making calories and other key facts more prominent also could create an industry backlash if it requires the label to take up any more real estate on the food packages, industry experts say Burkey Belser, principal at branddesign agency Greenfield/Belser Ltd and designer of the current nutrition label, said anything that requires food companies to give up space on their packages for nutrition facts would likely face resistance Consumer groups also had hoped for a sharp reduction in the amount of sodium listed as the daily value because of the chemical’s link to high blood pressure But the administration plans just a slight decrease, to 2,300 from 2,400 milligrams daily Yellen, Eye on Growth, Says Bond Cuts Could Be Slowed BY PEDRO NICOLACI DA COSTA AND BEN LEUBSDORF Federal Reserve Chairwoman Janet Yellen said she isn’t sure how much of the recent deterioration in U.S economic growth is due to weather, adding the central bank might consider a pause in its reduction of bond buying if the weakness persists “Asset purchases are not on a preset course, so if there’s a significant change in the outlook, certainly we would be open to reconsidering, but I wouldn’t want to jump to conclusions here,” Ms Yellen told the Senate Banking Committee on Thursday, in the second day of congressional hearings Since Feb 13, U.S economic data have shown signs of weakness, with retail sales falling 0.4% and industrial production declining 0.3% in January The recovery in housing has also shown signs of fraying Ms Yellen said officials would be tracking the data carefully to estimate whether a shift in their outlook is warranted “A number of data releases have pointed to softer spending than analysts had expected,” she said “That may reflect in part adverse weather conditions, but at this point it is difficult to discern exactly how much.” The Fed’s bond-buying program was designed to drive faster growth by lowering borrowing costs to encourage more spending, hiring and investment The central bank decided in January to trim its purchases by $10 billion to $65 billion a month, and Fed officials have signaled they’ll likely continue reducing the purchases this year if the economy improves as they expect Ms Yellen played down lawmakers’ concerns about the Fed’s large balance sheet, which now exceeds $4 trillion Some economists worry that by creating new money to buy the bonds now on the balance sheet, the Fed has sown the seeds of financial bubbles or higher inflation once the economy picks up steam But Ms Yellen said the Fed still has the means to tighten monetary policy despite the size of its holdings the singular style of wes anderson with the wall street journal next friday ©2014 Dow Jones & Company, Inc All rights reserved 3DJ3231 8| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL WORLD NEWS BY JEYUP S KWAAK Associated Press SEOUL—North Korea on Thursday launched four short-range missiles into the sea off the eastern coast of the Korean peninsula, stirring tensions after a naval incursion earlier this week South Korea’s Defense Ministry said the firings appear to have taken place at 5:42 p.m local time from the Kittae-ryong hills in North Korea’s southeast, but couldn’t immediately provide more details Given their range of around 100 miles (160 kilometers), the missiles are unlikely to have posed any danger to neighboring countries North Korea routinely launches short- and medium-range missiles during its military drills, which are also seen by some as a protest against U.S and South Korea military exercises Seoul and Washington began their biggest annual joint exercises on Monday North Korea’s last known firings took place in May when Pyongyang launched a series of short-range missiles over several days, seen by analysts as an objection to South Korean-U.S naval drills at the time The latest firings come after a North Korean warship strayed into South Korean waters from late Monday to early Tuesday, the first reported maritime incursion this year The missile firings and naval incursion follow an apparent easing in inter-Korean tensions Senior-level bilateral meetings were followed by reunions of families separated during and since the 1950-1953 Korean War from last Thursday to Tuesday The Japanese Red Cross association said Thursday it would hold talks in China next week with its North Korean counterpart for the first time since 2012, raising hopes the meeting could open the path for Tokyo and Pyongyang to discuss issues that have stood in the way of normalizing diplomatic relations North Korea’s ties with the West remain sour Pyongyang blasted a United Nations report that said Pyongyang has committed crimes against humanity, calling it a conspiracy by the U.S and its allies U.S Secretary of State John Kerry on Wednesday dubbed the secluded nation “an evil, evil place” while speaking about the human-rights abuses detailed in the 400-page condemnation by the U.N On Thursday, the North’s state media broadcast footage of a detained South Korean missionary who said he worked under Seoul’s orders to topple the North’s regime Kim Jung-wook said in a statement he was arrested in early October while trying to build underground Christian churches in North Korea “I wanted to let others know that I’ve done something very wrong,” said Mr Kim, who is among three known missionaries detained by the North Some of the video was shown on South Korean television —Alexander Martin contributed to this article South Korean missionary Kim Jung-wook said he was arrested in North Korea Somalia Car Bomb Kills 12 As Attacks Are Stepped Up A car bomb exploded near the headquarters of Somalia’s intelligence agency Thursday, killing at least 12 people, witnesses and officials said By Abdalle Ahmed Mumin in Mogadishu, Somalia, and Heidi Vogt in Nairobi The blast was the third deadly attack to hit the Somali capital in as many weeks Mogadishu has been touted as a success story for the Somali government since its forces regained control of the city from militants in 2011 Still, bombings and kidnappings of government officials remain common in the city There was no immediate claim for responsibility for Thursday’s attack, but it bore the characteristics of the many bombings in the city claimed by al Shabaab, an al Qaedalinked militant group that controls much of the Somali countryside and is waging a campaign to regain control of the capital The attack took place around midday, when a white sports-utility vehicle exploded into flames near the headquarters of the National Security Services, witnesses said “I saw the white car burning as the flames and smoke went on the sky,” said Mohamed Nur, 35 years old, who was sitting in a nearby restaurant He said he saw three bodies on the ground It wasn’t immediately clear if the driver died inside the vehicle or had parked and fled Abukari Ali, the district commissioner who oversaw the evacuation of survivors of the blast, said 12 people had been killed, not including the attackers Agence France-Presse/Getty Images Missile Launchings Raise Korea Tension A 1993 photo shows Australia’s first Collins class submarine The Asia region is witnessing a greater undersea presence Australia Reviews Plan To Double Its Sub Fleet BY ROB TAYLOR AND PATRICK BARTA CANBERRA, Australia—The new conservative government, under pressure to rein in its budget even as Asian neighbors dramatically ramp up military spending, will review plans to double Australia’s fleet of submarines Defense Minister David Johnston said he was unconvinced that Australia needed as many as 12 new conventional submarines currently foreseen by military planners The review comes as regional neighbors, led by China, build up their naval and air arsenals amid disputes over territorial waters, especially in North Asia At a cost of as much as 36 billion Australian dollars (US$32.28 billion), doubling the submarine fleet would be the country’s largest single military purchase “It’s a mystery to me [where that number of 12 came from],” said Mr Johnston, who has called for a review of military-equipment spending as part of a yearlong strategicplanning process launched by the conservatives, who swept to power in September elections on a promise of fiscal restraint “That is a technical issue that the current circumstances will dictate and I want [the] navy to tell me what they foresee is the way forward It might be more than 12, it might be less I’m not sure,” he said in an interview Australia’s former Labor government in 2009 released a defenseplanning paper that called for a dozen large, conventionally powered submarines to replace the country’s existing fleet of six Collins class submarines Although much larger than submarines operated by regional neighbors, the Collins class submarines have been plagued by technical problems On Thursday, a fire erupted on the submarine HMAS Waller off the West Australian coast, Australia’s Defense Department said There were no casualties A new fleet of larger, more powerful and longer-range submarines would counter a growing undersea presence in Asia Singapore, Indonesia, Vietnam and Malaysia are fielding new submarines to counter threats to some of the world’s most important energy-trade routes, as well as to hedge against Chinese ambitions China in January sent a surface warship fleet—possibly backed by a submarine—into waters between Indonesia and Australia, demonstrating Beijing’s naval reach The move prompted some alarm in Canberra, which sent a maritime patrol aircraft to keep watch Southeast Asian nations typically operate submarines of about 2,000 submerged tons, while Australia envisages boats of 4,000 tons or more, possibly equipped with submarinelaunched cruise missiles for land attack and capable of deploying special-forces soldiers China and others have been building up their naval and air arsenals Australia’s submarine-replacement program, no matter how ambitious it turned out to be, wouldn’t add to regional rivalries, with the close U.S ally having long fielded a small but highly capable military that was well respected regionally, Mr Johnston said “For many, many years we have owned and operated the world’s largest conventionally powered submarine, so the neighborhood is well used to us having a large and unique diesel-electric submarine,” he said Australia already has embarked on an expensive buildup of military equipment, including two 27,000-ton amphibious assault ships, new attack and transport helicopters, guided-missile destroyers, tanks and Super Hornet strike and electronic attack aircraft Australia has a defense budget of some A$26 billion in the year ending in June, or 1.6% of gross domestic product The government plans in the next few years to buy as many as 100 F-35 Lightning joint strike fighters to provide radarevading air power, at a cost of as much as A$16 billion But the military has come under pressure to reduce costs as the world’s 12th-largest economy retreats from a mining boom, driving up joblessness and eating into government revenue The government in December forecast budget deficits totaling A$123 billion over the next four fiscal years to June 2017, and said it would cut billions from spending But this week the country, which two years ago agreed to rotate thousands of U.S Marines and their aircraft through Australia’s north, said it would buy A$4 billion of new Boeing Co.-built P-8A Poseidon maritime patrol aircraft capable of ranging well into Asia Those aircraft are likely to be joined later this year by a A$2.9 billion fleet of seven long-range MQ-4C Triton drones Mr Johnston said he was open to the idea of Australia’s far-flung Cocos islands, in the Indian Ocean southwest of Indonesia, being developed as a base for U.S or Australian Tritons But he said there was no proposal currently to upgrade the islands’ dilapidated airstrip to expand maritime reach, as Chinese vessels increasingly patrol further from home China’s growing assertiveness in the East China Sea and elsewhere was to be expected of any country with growing energy needs, Mr Johnston said, including a demand for Australian oil and gas resources China is Australia's largest trading partner “They are hostage to the importation of food and energy I think they would be dilatory were they not to want to protect those sea lanes,” he said “I’m not reactive to these things that are happening in the South China Sea.” THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | WORLD NEWS BY SARA SCHAEFER MUÑOZ BOGOTA—Colombia’s finance minister said some $12 billion in investment on infrastructure projects this year will boost this Andean country’s gross domestic product even as the U.S signals an end to easy-money policy and some analysts predict a drop in commodity prices In an interview, Finance Minister Mauricio Cárdenas said Colombia will make enough updates to its lagging infrastructure to eventually add one percentage point to annual GDP growth Growth will also be bolstered by about one percentage point a year if the government achieves a peace agreement with the country’s main insurgency group, the Revolutionary Armed Forces of Colombia, or FARC, he said The negotiations have been a focus of the administration of Colombian President Juan Manuel Santos, who is up for re-election in May “Colombia will become a country that can grow at 7% on a sustained basis,” said Mr Cárdenas “It doesn’t necessarily mean we will achieve this every single year but potentially we could be growing at that if we achieve these two big goals.” Mr Cárdenas projects an economic expansion of 4.7% this year, based on the public-works spending and a recovery in the U.S., Colombia’s biggest trade partner That is higher than the official estimate for 2013 GDP growth, which is between 4.3% and 4.5% He said the country has nine ten- ders open for road projects that will bring in an estimated $6 billion in private investment and should break ground in 2015 He said more projects, adding another $6 billion, are coming up in the next three months Mr Cárdenas said that investment and other factors make Colombia less vulnerable than other developing nations to what many economists say is an impending “double-whammy,” meaning the wind-down of the U.S Federal Reserve’s policy of quantitative easing and a drop in the prices of commodities The concern is that high demand for commodities from China—the backbone of Latin America’s economic boom overt the past decade— is waning In addition, the U.S.’s quantitative-easing stimulus program, which pushed up many emerging-market currencies and ushered in a flood of foreign money, is being tapered as the U.S economy shows signs of stronger growth Already, many developing countries have started seeing capital outflows, and their currencies have been hit Mr Cárdenas said Colombia will be little affected by the tapering, in part because the country has depended very little on portfolio flows Portfolio flows are investments in assets like stocks and government bonds that came into emerging markets during the easy-money times of QE, but that can be easily reversed He said that in Colombia, most capital has been foreign direct investment in sectors such as mining, which is a more stable source of Bloomberg News Colombia Official Touts Infrastructure Mauricio Cárdenas, seen in October, said Colombian GDP can grow 7% annually funds “I think we have more to gain than to lose [from QE pullback] because what tapering shows is that the U.S economy is recovering Being our largest trading partner, that’s good news for our exports,” he said Analysts warn that the Colombian economy is still heavily reliant on natural resources, with commodities like oil, coal and nickel making up 65% of all exports Mr Cárdenas said that the country has protection because its fiscal rule bases spending on long-term prices of commodities, and if a reduction is forecast, expenditures will be adjusting accordingly He also said Colombia is seeking to diversify its economy through free-trade agreements, as ones with the European Union and the U.S., and the recent deepening of ties within the Pacific Alliance, a trade bloc made up of Colombia, Chile, Mexico and Peru In February, the alliance said it would lift tariffs on 92% of all goods Like other currencies, Colombia’s peso has depreciated recently, falling nearly 7% over the past two months, to around 2,050 per dollar Mr Cárdenas said it is a “breath of fresh air” for the Colombian economy, especially helping the country’s hard-hit export sector He said the government doesn’t have an exchange-rate target, and he and other officials say the peso can fall further before posing a problem to the central bank’s inflation target of 2% to 4% Augusto de la Torre, the World Bank’s chief economist for Latin America and the Caribbean, said Colombia—along with Chile and Peru— is well-positioned to weather the end of quantitative easing and a China slowdown He points to robust monetary-policy frameworks with flexible currencies and room to devalue if an economic boost is needed, as well as relatively strong fiscal position and low public-sector debt “These factors taken together reflect a strong macroeconomic immune system,” said Mr de la Torre Colombia’s situation stands in contrast to that of its neighbor, Venezuela, which is beset by soaring inflation and is expected to enter recession this year, and where massive, violent protests that erupted in February are leaving most of the country at a standstill Once a key trading partner, Colombia is much less exposed to Venezuela than it was in the past, because of fewer ties after delays in payment to Colombian exporters, Mr Cárdenas said But Colombia has been affected by the differential between Venezuela’s official exchange rate and its widely used, black-market exchange rate Colombians can enter Venezuela with highly prized dollars and buy goods cheaply, many of which are resold in Colombia “That’s bad for the authorities in Venezuela, and that’s bad for us in Colombia, because these goods create competition for our producers,” Mr Cárdenas said Runner’s Murder Case Puts Focus on South Africa JOHANNESBURG—The trial of former Olympian and accused murderer Oscar Pistorius that starts Monday is driving business, drawing journalists from around the globe and holding up a gigantic mirror to South Africa In some ways, the trial exposes how the country has fallen short of some of its earlier promise Violence against women and gaping divides between rich and poor—and whites and blacks—persist two decades after South Africa became a democracy Those issues are expected to surface in the trial of Mr Pistorius, one of South Africa’s richest athletes He says he mistakenly shot his girlfriend through a locked bathroom in the gated and largely white luxury estate where he lived “Yes, it’s Oscar on trial But also South Africa,” says Aletta Alberts, head of content at South African cable network Multi-Choice, which is selling advertising for a 24-hour channel it is launching to run during the trial A court ruled Tuesday that parts of the Pistorius trial can be broadcast live One book already has been published on the case More are in the works Other businesses see opportunity in the trial as well Cricklewood Manor and Boutique Hotel has hosted globe-trotting guests who come because of its secure location and country manor décor Now, the hotel hopes the trial will be its next big draw Cricklewood Hotel is about 800 feet from the well-secured house where Mr Pistorius has stayed with his uncle in the country’s capital of Pretoria The hotel’s marketing de- partment this month sent out targeted emails to journalists and others close to the trial that highlight its proximity to the home “Our marketing strategy has shifted to focus on everyone involved in the trial,” said Shaun Wilson, the operations manager at Cricklewood, which hosted eight presidents during the memorial for South Africa’s late president, Nelson Mandela, in December The Pistorius family said they were aware of the Cricklewood marketing campaign, but declined further comment At the time of his arrest last year, pictures of a teary-eyed Mr Pistorius riveted the country—and the world He was the homegrown hero who, after being born without fibulas in both legs, fought to become the first Paralympian to compete in the able-bodied Games in London 2012 His girlfriend, Reeva Steenkamp, was a model and an aspiring actress with a law degree He killed her in the early hours of Valentine’s Day On Monday, the South African state will formally charge Mr Pistorius with murder He is expected to plead not guilty to intentionally killing Ms Steenkamp In addition to his lawyers, Mr Pistorius’s star-studded legal team includes a forensic geologist, ballistics expert and an expert who replicates three-dimensional crime scenes The case has devastated his commercial empire, but his ability to afford a high-price defense—a luxury most South Africans don’t have— also illustrates disparities in the country, said Michael Goldman, a professor at Johannesburg-based business school Gordon Institute of Business Science “The two South Africas will become very clear again with this Reuters BY DEVON MAYLIE Mr Pistorius in court in February 2013, shortly after his girlfriend’s death Observers speak of country’s pattern of violence story,” he added Mr Pistorius’s wealth puts him worlds away from all but a fraction of South Africa’s super-rich The country’s average income is about $300 a month, and unemployment is about 25% of the working-age population Days after the shooting, Nike Inc and Oakley sunglasses suspended lucrative sponsorship deals with the athlete In papers filed during Mr Pistorius’s bail hearing, the athlete said he made 5.6 million rand ($521,920) a year To help pay his legal bills, the athlete sold his shares in some racehorses and will sell the house in a gated community where Ms Steenkamp was killed after the trial ends The murder he is accused of committing hits closer to home On average, 42 people are murdered each day in South Africa— roughly the same as the U.S., a country with more than six times as many people Meanwhile, one woman is killed by a partner every eight hours in South Africa, according to a 2012 study by the South African Medical Research Council The study found that while the murder rate for women declined—along with the overall murder rate in the country—a greater proportion of female murders in 2009 were caused by an intimate than 10 years prior Mr Pistorius’s uncle’s house, in the same upscale neighborhood as the Cricklewood, is a large brick mansion protected by electric fencing and a wrought-iron gate “There are a lot of murders here This is just one,” said Tedius, a security guard down the street from the house “It’s not right that it gets all the attention when there are so many other problems.” 10| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL Reuters IN DEPTH Across Japan, there are signs that the collective mood is in the midst of a shift as tensions with China and South Korea escalate Mr Abe’s December visit to a World War II shrine, above, stirred global controversy Tensions Around Asia Stoke Rising Nationalism in Japan Worries Over Economy, Fears of Beijing’s Muscle-Flexing Spur Feelings of Mistrust and Outright Hostility BY YUKA HAYASHI Tokyo A movie glorifying the life of a World War II kamikaze pilot recently topped the box-office charts in Japan for two months Tokyo book stores have set up corners for titles disparaging Japan’s neighbors Anonymous authors with radical nationalist views, known as neto uyo, short for “right-wingers on the Internet,” are thriving on Twitter and chat pages Across Japan, there are signs that the collective mood—long shaped by pangs of regret over World War II—is in the midst of a shift as tensions with rivals, especially China and South Korea, escalate Fearful of Beijing’s muscle-flexing in nearby waters and worried about Japan’s economic future, more people are expressing feelings of nationalism, mistrust and sometimes outright hostility toward their neighbors “Ideas that have long been suppressed and locked away, like the desire to hate and discriminate, are now pouring out from many corners of the country and amplifying each other in an echo chamber,” says Kiyomi Tsujimoto, a veteran opposition lawmaker “That’s fueling anti-Korea and anti-China sentiment.” Pacifism still runs deep in Japan, and the shift to the right is in its early stages But the tone is already influencing Japanese politics, with the emergence of a new wave of candidates—mainly in their 30s and 40s—who hold staunchly conservative views similar to those of America’s tea party In a Tokyo gubernatorial election in February, Gen Toshio Tamogami, a former airforce chief who heads a right-wing group known for its xenophobic rallies, snared an unexpectedly large share of votes, even though the country’s traditional media had all but written him off as a fringe figure An exit poll by the Asahi Shimbun daily indicated that 24% of respondents in their 20s had voted for Mr Tamogami, who lost the race The rise of a more-vocal nationalist minority in Japan is cause for concern among foreign officials not just in East Asia, but also in the U.S Some leaders fear it could exacerbate regional tensions and increase the odds of a confrontation between China and Japan—the world’s second-largest and third-largest economies after the U.S Daniel Russel, Assistant Secretary of State for East Asia, said in recent congres- sional testimony that the U.S remained concerned about a “serious downturn” in China-Japan relations He called on the nations to “lower tensions” and “turn down the rhetoric.” With Japanese and Chinese fighter jets and patrol ships continuing cat-and-mouse chases near disputed islands in the East China Sea, other U.S officials, including Vice President Joe Biden, have warned of the risk of dangerous clashes Many Japanese officials and lawmakers interpret the changes differently They say that citizens are finally responding to what they see as persistent and unjustified attacks from China and South Korea over wartime-legacy issues They say those countries have refused to acknowledge Japan’s repeated efforts to apologize and to atone for its wartime atrocities Chinese and South Korean officials dismiss such notions Criticizing Tokyo for what they see as revisionist history, leaders of the two countries have refused to meet privately with Prime Minister Shinzo Abe since he took office 14 months ago “It is deplorable that leading Japanese politicians have recently been attempting to deny and even justify past wrongdoing with an attitude of historical revisionism,” Kim Jung-ha, a senior South Korean diplomat, said at a United Nations meeting in January Japan under Mr Abe seems to be repeating the mistakes of Germany before World War I and those of Japan before World War II, said Yang Bojiang, a Japan expert at the government-backed Chinese Academy of Social Sciences, in a commentary on Monday in the People’s Daily, the Communist Party’s newspaper “This must arouse the vigilance of peace-loving countries of the world to prevent humanity from being dragged once again into the abyss of war,” he said China and South Korea have also seen nationalist bumps in recent years But the trend in Japan is especially sensitive, given its historical role as an aggressor in World War II The last time Japan saw a sharp rise in nationalism was in the 1920s and 1930s, the period leading up to war At the time, the country was struggling amid the aftermath of a huge Tokyo earthquake and the global depression Unlike in that era, today’s Japan is a mature democracy that has contributed to international peace for decades Its military is tightly under civilian control Many political scientists say that Japanese society has the flexibility to push back the pendulum if it keeps swinging toward nationalism, as it 26| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL SPORT HEARD ON THE PITCH Five-Match Ban for Anelka Over ‘Quenelle’ Gesture West Bromwich Albion player Nicolas Anelka was given a fivegame ban and $133,000 fine by England’s Football Association after finding him guilty of causing racial offense with a goal celebration deemed anti-Semitic Anelka denied his use of the gesture, known in France as a “quenelle” and described as an “inverted Nazi salute,” was anti-Semitic But an FA disciplinary panel, which heard the case this week, decided otherwise for the former France international who made the gesture during a Premier League match in December The gesture involves pointing one straightened arm downward while touching the shoulder with the opposite hand It was popularized by French comedian Dieudonne M’Bala M’Bala, who has been convicted multiple times for inciting racial hatred or antiSemitism —Associated Press HEARD ON THE FIELD Associated Press (left); Reuters Video Pirates Slip Up In Sochi Clampdown Seattle Seahawks quarterback Russell Wilson waves the Vince Lombardi Trophy at a Feb rally and Jennifer Lawrence grasps her 2013 Best Actress Oscar Bowled Over by the Oscars Again With Parallels Between Sport and Film’s Hype-Fests, Here’s a Guide to the Party BY JASON GAY The Oscars are Sunday, and I am not the first or last idiot to draw a parallel to major sporting events like the Super Bowl Both spectacles get massive TV ratings, there’s a lot of group viewing with pithy comments and mediocre nachos, and the Cleveland Browns have never come close to winning either This is the part where you exclaim: I am not going to watch the Oscars this year! And yet you Come on You’re not fooling anybody You’re even picking “Monsters, Inc.”—though it came out 13 years ago The Academy Awards—that’s fancypants-speak for Oscar—are a comforting if maddening routine The audience begins excitedly, and slowly loses its mind The unenthused fall asleep The masochists slog all the way to the end It’s like being a Knicks season-ticket holder Here are some rules for a memorable Oscars viewing experience: You might want to doublecheck this, but I believe these Oscars—televised live from Ralph Wilson Stadium in Orchard Park, N.Y.— are the first Oscars held outdoors at a cold-weather stadium How will the weather impact the favorites? Will it snow in the second half? Tune in Warning: An Oscars telecast is long Like, brutally long Tennis long Please hydrate This year’s Academy Awards telecast begins sometime around a.m on Sunday and the final award—Best Picture—is presented sometime around p.m on Thursday, March 13 By the way, there are nine Best Picture nominees now Nine nominations! It is now harder to not be nominated for Best Picture than it is to not make the NHL playoffs There are four stages of the Oscars telecast Stage 1: This year’s show isn’t actually so bad Stage 2: OK, this is getting bad Stage 3: I really should my laundry but I can’t…stop…watching Stage 4: (Falls asleep for 38 minutes.) Stage 5: (Wakes up mid-speech of Best Director, yells at TV, falls back asleep.) You not need to watch all of the nominated movies in order to watch the Oscars If you find yourself sitting next to someone who has watched all of the nominated movies, congratulations, because you are sitting next to Martin Scorsese If you think the Oscars are some kind of logical endeavor, consider that Scorsese’s “Hugo” won more Oscars than “Goodfellas” and “Raging Bull” combined If anyone at your Oscars party refers to Scorsese as “Marty,” it’s OK to ask them to leave Same with anyone who says you didn’t really see “Gravity” unless you saw the IMAX 3-D Experience Somebody at work is going to ask you to join an Oscar Pool Join the Oscar Pool! It’s fun! Just know that the Oscar Pool will be won by a co-worker who hasn’t seen a movie since “Harold and Maude” in 1971 10 If you are throwing an Oscars party, you need to decide if it’s going to be a cinema lover’s party or an Oscars party At a cinema lover’s party, people dress up and have thoughtful conversations about the nominees and the year in cinema At an Oscars party, everyone sits in their sweatpants and trashes every single thing that happens for four hours 11 Will leave it up to you which one is more fun 12 That’s what Oscars Twitter is, basically 13 No you can’t serve the leftover Super Bowl chili at your Oscars party I don’t care that it was in the freezer! Warning: An Oscars telecast is long Like, brutally long Tennis long 14 Ellen DeGeneres is your Oscars host this year but please next year can it be Tara Lipinski and Johnny Weir? Also please let Tara Lipinski and Johnny Weir host the Super Bowl And the Final Four And the Masters And the State of the Union Basically would like Tara and Johnny to host everything from here on out Thanks 15 For fun, divide up your Oscars Party between people who were into “Her” and not into “Her.” 16 No “True Detective” bickering at your Oscars Party Save it for the Internet! 17 Do not get crazy with self-esteem issues watching celebrities arrive on the red carpet You would look like that, too, if you ate only kale and sand for six months 18 Whenever you see a bad outfit at the Oscars, not despair for the celebrity wearing it Despair for the soon-to-be-former friend who said, walking out the door to the limo: “Yup Looks amazing.” 19 Men have it easy at the Oscars Basically there’s one rule: Don’t show up looking like Mr Peanut 20 Yes: Those short films all look amazing and you really should watch them Also: you’re never going to watch them Who is kidding whom? 21 It would be cool if Matthew McConaughey won an Oscar But not as cool as if he pulled up to the Oscars in a 1970 Chevy Chevelle Super Sport 22 There’s always somebody at every Oscars party who tells a long story about the time they saw Richard Dreyfuss at the airport and he was totally a nice guy 23 Rule No of Oscars acceptance speeches: Thank your mother There is no rule No 24 The above is also a useful rule for life in general 25 Oscars insight: the farther away from the stage a winner is, the longer it takes them to get to the podium, the happier, nicer and more well-adjusted they are Also more likely they have half a turkey sandwich in their pocket 26 The greatest pay-per-view of all time would be an Oscars telecast in which sensors inside Brad’s and Angelina’s heads told you what they really think about everybody in Hollywood 27 Let’s face it: This year, you have seen three movies And 3,508 YouTube cat videos 28 Good luck everybody! Remember: Thank your mom And your agent’s mom! NBC says it worked with Olympics officials to stop some 45,000 instances of illegally posted video or pirate streams showing competition during the Sochi Games Broadcasters pay big money to the International Olympic Committee in return for exclusive TV and streaming rights and guard that exclusivity keenly In NBC’s case, the network paid $775 million for the Sochi rights Officials estimated Thursday that some 20,000 Olympics videos were kept off YouTube and 20,000 more off other video-sharing sites around the world The antipiracy police also said they located and stopped an estimated 5,000 illegal streams of Olympics material, much of it live competition —AP Australia’s Warner Fined Australia batsman David Warner was fined by the International Cricket Council on Thursday for “inappropriate” comments suggesting South Africa wicketkeeper AB de Villiers was ball-tampering in the second Test in Port Elizabeth Warner said in a radio interview that de Villiers regularly wiped the ball with his glove in Australia’s second innings Australia lost by 231 runs, with South Africa fast bowler Dale Steyn getting the ball to reverse swing extensively for his four wickets The ICC said Warner was fined 15% of his match fee after admitting the offense —AP Agence France-Presse/Getty Images Nicolas Anelka denied that his gesture was anti-Semitic THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | 27 OFF THE WALL Hello to Arms: Marines Bring Back a Tradition BY BEN KESLING rines learning the ropes under the tutelage of drill instructors like here were grumbles in 2009 him “You could make your shoes when the U.S Marine Corps shine like glass,” he said nostalgiordered troops to keep their cally hands out of their pockets except The sleeve rolls had to be just to quickly “retrieve something.” right The official Marine order at But when the Corps’ commandant the time said: “When authorized, later decreed that Marines had to utility sleeves will be rolled with stop rolling up their sleeves, a the inside out, forming a roll longtime fashion statement, the about three inches wide, and terleathernecks went into action minating at a point about two “That’s what separated us from inches above the elbow.” every other branch, our sleeves,” Sloppily folded sleeves were said First Sgt Shawn Wright, a known as “Gunny Rolls,” after career Marine who was a drill ingunnery sergeants—salty senior structor Troops launched petition enlisted Marines known more for drives and peppered superiors their hard-bitten practicality than with questions Some complained spit-and-polish looks it hid their tattoos Marines’ sleeves stood out The top brass did an aboutfrom those in other services beface this week and returned the cause, when rolled, the undyed right to bare arms, starting March backside of the camouflage mate9 rial would show, making the roll “I can’t tell you how many look white Those in the Navy and times we have been asked the per- Air Force can still roll their sistent question, sleeves at certain ‘Commandant, are we times, while the ever going to return Army also nixed to SLEEVES UP?’” rolled-up sleeves said Gen James about a decade ago Amos, commandant of Unlike other the Marine Corps, in a branches, Marines Facebook post on the rolled their combat Marines account late sleeves the same as Tuesday “I’ve thought dress-shirt sleeves a lot about this over “The Army would roll Marine sleeves up the past 2.5 years; I up their sleeves in an realize that it’s imporaccordion way, so the tant to you Sleeves up clearly and button and cuff would end up on visually sets us apart WE HEAR the outside,” said Owen Conner, YOU MARINES!” the uniforms and heraldry curator The general’s Facebook post at the National Museum of the garnered more than 30,000 likes Marine Corps and nearly 3,000 comments in The Marines’ precisely rolled less than a day “The roar of apsleeves were a holdover of the proval from across the Corps has care put into their old-style unibeen deafening,” said Lt Col Daforms—before a uniform overhaul vid Nevers, a Marines spokesman 10 years ago “I understand it “In the four years since we began sounds petty to some people,” using social media we haven’t said Sgt Steven Hoffman, 28, seen any post generate such an from Freehold, N.J “But it comes overwhelmingly positive reacback to tradition.” tion.” The former Battle Dress Uniforms were starched and ironed, with some troops even applying glue or melting a bit of plastic The U.S Marines’ into trouser creases to keep them precisely rolled sleeves razor sharp Fastidious troops would put their camouflage caps were a holdover of the on a metal frame after starching care put into their oldthem at night to help retain a perfect shape style uniforms In 2004, the Marine Corps switched to camouflage combat uniforms made of wrinkle-free Not every reaction has been material that don’t require irongung-ho One Facebook comment ing In fact, “the use of starch, pooh-poohed the hoopla: “This is sizing and any process that inwhy nobody takes the USMC serivolves dry-cleaning,” according to ously.” Marine orders, “is not authoRolled sleeves had long been a rized.” point of pride Even the highestMarines also got new combat ranking Marines could toil at foldboots around the same time ing, ironing and even starching Made of suede, they can’t be polsleeves into a crisp flattened roll ished The former Marine boots on their woodland-green camouwere often spit-shined daily flage and their desert-brown uniSome troops groused in 2007 forms Rolls could once be found when then-Commandant Gen even in combat zones, but the James Conway announced that practice was slowly curtailed until only the summer-season, desertthe 2011 order eliminated it enbrown camouflage utility unitirely forms could have rolled sleeves First Sgt Wright recalled how In October 2011, Gen Amos depreparing uniforms and shining clared all Marine Corps Combat boots could take troops an hour Utility Uniforms would be worn or more, especially for new Ma“sleeves down” all year, no matter Associated Press T Marine Commandant Gen James Amos, shown speaking with reporters in 2011 before he banned rolled-up sleeves the clime or place Marines are known for being particularly ornery when it comes to uniforms Their camouflage pattern has a U.S patent, preventing other military branches from copying In October, Gen Amos quashed a proposal that would have required male and female Marines to wear the same “unisex” white cap with their traditional dressblue uniforms after Marines, and a few members of Congress, complained Attention then returned to the ban on rolled sleeves “Americans always like a touch of individualism with our uniforms,” said Mr Conner with the Marines museum “We’re not the Prussian Army.” “We’re definitely glad to be able to get it back, it was a good call,” said First Sgt Wright, who added he can hardly wait until the order takes effect “I’m like a kid at Christmas.” Marines must continue to wear sleeves down in combat zones, during training and in winter months They still are forbidden to keep their hands in their uniform pockets lord snowdon in the spotlight with the wall street journal next friday ©2014 Dow Jones & Company, Inc All rights reserved 3DJ3233 28| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL HEARD ON THE STREET Email: heard@wsj.com FINANCIAL ANALYSIS & COMMENTARY “Try again Fail again Fail better.” Playwright Samuel Beckett’s words might as well be Royal Bank of Scotland’s mission statement Certainly, RBS restructuring plans have joined death and taxes among life’s inevitabilities The 81% state-owned U.K bank’s latest reorganization follows a monumental £9 billion ($15 billion) net loss last year Whether new Chief Executive Ross McEwan’s revamp will work is anyone’s guess, though investors are skeptical—the bank’s shares slumped another 9.3% on Thursday The new business plan involves shrinking RBS’s seven business lines into three, with medium-term cost-cut targets totaling £8 billion Head-count reductions haven’t been detailed, though previously announced spinoffs of RBS’s U.S bank Citizens Financial Group and its Williams & Glynn retail branch network in the U.K will take more than 20,000 people off the payroll, around a sixth of the current total Even so, RBS may not achieve a return on tangible equity of 12% until Associated Press No End for RBS’s Trouble Hope Lives On RBS’s long-term targets versus recent performance 2013 negative Return on tangible equity 12%+ Cost income ratio Core Tier equity ratio Ross McEwan, CEO of Royal Bank of Scotland 2020—a forecast too distant to carry real meaning Mr McEwan has at least grasped the nettle of RBS’s problematic investment bank Its risk-weighted assets will be cut by £50 billion, a reduction of almost 40% This shrinkage—in line with the government’s wishes—at least gives RBS more strategic clarity But it may hinder its growth back to a size that will allow the U.K government to make good on the £45 billion it plowed into the bank dur- Qantas Facing Stormy Weather More needs to be done to get Qantas Airways out of its tailspin Australia’s biggest airline announced Thursday that it will cut 5,000 jobs, delay orders for 11 jumbo jets and sell airport leases after swinging to a first-half net loss of 235 million Australian dollars (US$211 million) Still, Qantas shares fell 9% as investors worried more was needed to combat intense competition from rival Virgin Australia Qantas had Australia mostly to itself after its sole major competitor closed shop in 2001 Then came Virgin, which launched a fierce price war in 2010 Qantas shares have lost more than half their value since then, while Virgin Australia has amassed a third of Australia’s flying market Qantas remains at a disadvantage as unit costs, excluding fuel, were about 15% higher than Virgin’s last financial year, according to Macquarie Virgin smells blood and isn’t likely to back off Though its own shares have been battered by the price war, they trade at well above net tangible assets Qantas trades at less than half that measure Virgin has the financial support of shareholders Air New Zealand, Singapore Airlines, Etihad Airways and Richard Branson’s Virgin Group, who 2018-’20 target together own 70% of the carrier They have a long-term strategic interest in carving out a strong position in Australia and destabilizing Qantas Qantas’s predicament raises the question of whether Australia can support two major airlines That puts Australia’s government under pressure to step in to maintain competition Qantas has requested state debt guarantees A more realistic option might be lifting a 49% government-imposed cap on foreign ownership of the carrier More drastic measures may be in the offing A spinoff of Qantas’s Asia regional budget carrier Jetstar would free up capital and management attention Macquarie estimates a spinoff could raise about A$400 million J.P Morgan estimates selling a 49% stake in Qantas’s frequent-flier program could raise up to A$1.6 billion, but it is one of Qantas’s more profitable units The clock is ticking for Qantas to figure things out While it does have A$2.4 billion of cash and A$630 million in standby bank facilities, losses are mounting Its fate seems increasingly tied to whether Australia’s government wants a two-carrier country —Rebecca Thurlow 73% about 50% 8.6% 12% Source: the company The Wall Street Journal ing the global financial crisis Godot may yet arrive before RBS returns fully to the private sector RBS’s results, moreover, cap a dismal reporting season for Europe’s major banks Five years on from Lehman’s collapse, none of them—including Barclays, HSBC, Credit Suisse, UBS, BNP Paribas and Deutsche Bank—are making a return on equity above 10% Sure, balance sheets have been strengthened, but major banks’ core OVERHEARD Tier equity hovers just above 10% of their riskweighted assets at best RBS’s stands at 8.6% The drip-drip of scandal persists, with probes into foreign-exchange trading and Credit Suisse’s alleged tax-evasion schemes the latest examples Against this background, calls from the likes of UBS Chief Executive Sergio Ermotti to end bank bashing sound ludicrous The industry has already moaned endlessly about capital rules that will still allow banks to borrow 33 times their equity And instead of taking the European Union’s admittedly clumsy attempts to cap bonuses as a signal to show some pay restraint finally, bank executives have spent the past few months finding ways around the new rules Despite its loss, RBS will pay out over £500 million in bonuses for 2013 European banks’ shares may have risen 19% in the past 12 months But an evening of Beckettian existential angst is more likely to be a pleasurable experience than following their fortunes —Andrew Peaple Ultralow interest rates and a rush of money into bond markets seeking returns: times should be good for high-yield borrowers Indeed, they are Maybe they are a bit too good So far this year, defaults among high-yield corporate borrowers are noticeable by their almost total absence In the U.S., there were no defaults until Feb 18, when MModal Inc., a provider of clinical documentation products, missed an interest payment, according to Standard & Poor’s S&P says it has been 30 years since the first U.S corporate default arrived so late in the year Globally, there have been just three defaults year to date, versus 13 in the same period of 2013, the ratings firm says And 2013 was a good year, too: S&P says the global speculative-grade corporate default rate was 2.3% That is music to the ears of junk-bond investors, of course But it also might raise some concerns among policy makers that loose monetary policy is storing up trouble for the future Europe Bond Juggernaut Rolls On How low can you go? Where other markets have faltered so far this year, the euro-zone government-bond market has just kept on rallying Yields have fallen across the board, with the sharpest gains in southern Europe Little seems able to upset the trend Italian and Spanish 10-year yields have both fallen by more than 0.6 percentage point this year, to just under 3.5%, and are now at levels unseen since early 2006 In Portugal, the rally has been even sharper: 10-year yields have fallen more than a percentage point and five-year yields by about two points That is generating strong returns Italian bonds are up 3.5% in the year to date, according to Barclays indexes, while Spain is up 4% and Portugal 7.7% Importantly, the investor base for euro-zone government bonds is deepening At the peak of the euro-zone crisis, domestic banks took the strain and massively increased their home-sovereign bondholdings But while Italian banks marginally reduced their holdings of Italian government bonds in January, according to European Central Bank data, yields still fell sharply, indicating interest from other buyers Spanish banks did add €18.1 billion ($24.77 billion) of domestic government bonds, but holdings are still well below their 2013 peak Encour- agingly, French banks, which dumped non-French government bonds as the crisis ramped up in 2011, added €14.6 billion of non-French bonds in January Greater cross-border flows would be a sign of healing in Europe’s bond markets concerns re-emerging about the sustainability of some European governments’ debt loads The ultralow inflation levels in Southern Europe also mean that governments still are paying relatively high real debt yields But the broadening of in- The broadening of investor demand and Europe’s gradual recovery mean euro-zone government bonds could offer further gains So far, bond investors don’t seem worried about low inflation, which stands at just 0.8% in the euro zone Low inflation or deflation would normally be a bond investors’ friend—but it makes the process of economic adjustment harder, and may yet lead to Falling Fast Yield on 10-year government bond, monthly data 7% Spain Italy ’04 ’06 ’08 ’10 Source: FactSet The Wall Street Journal ’12 ’14 vestor demand, along with Europe’s gradual recovery, means that euro-zone government bonds could yet offer further gains In Italy, there is hope that new Prime Minister Matteo Renzi will succeed in introducing overhauls In Spain and Portugal, there are signs that structural change is paying dividends in growth Credit ratings have started to move higher again after several years of steep downgrades Ultimately, euro-zone bond investors are sheltered from the debate about monetary policy tightening that is under way elsewhere Those hoping for radical easing from the ECB may yet be disappointed, as none of the central bank’s options come without drawbacks But investors can be sure the ECB won’t be tightening policy for a long time yet —Richard Barley WSJ.com/Heard For Baidu, Growth in Profit Is Elusive China’s online-search behemoth Baidu is doing what it must to stay competitive But in a theme Chinese Internet investors should get used to, profit growth isn’t going to be as bubbly as hoped That was the company’s message to investors Thursday Fourth-quarter revenue surged by 50% from a year earlier while profits were flat, as expected But in a conference call with analysts, Baidu Chief Financial Officer Jennifer Li dropped a bombshell, saying the company doesn’t expect any increase in profit this year as it continues to invest Pity the analysts, who according to FactSet had optimistically forecast a 31% rise in 2014 net profit Now they are asking where the money will be spent The answer is on more of the same The company has been spending heavily to migrate its desktop search advertising prowess to mobile, such as by paying phone makers to preinstall its search app Baidu also plunked down $1.9 billion to acquire 91 Wireless, a mobile-application store The good news is that Baidu’s toehold in the crucial mobile space is growing Mobile services accounted for 20% of total revenue in the fourth quarter, compared with 10% just two quarters ago Baidu has little choice but to invest in mobile or risk becoming a desktop dinosaur The hope had been that last year’s investment would start yielding profits this year But the investment treadmill continues Baidu has a leading map application, but faces rising competition from AutoNavi, part-owned by e-commerce giant Alibaba Group, which is now seeking full control Games and messaging colossus Tencent last year muscled in on Baidu’s core business by buying a stake in upstart search engine Sogou Investors are pricing high profit growth into shares, but competitive pressures could squeeze margins across the sector as everyone is forced into defensive investments Sina told investors this week it also plans to step up spending on its portal business and its Weibo microblog The stock fell 9% the following day Baidu’s relatively modest ratio of 26 times next year’s earnings jumps to 35 times on the company’s latest guidance On the Chinese Internet, the profits needed to sustain such high valuations remain elusive —Aaron Back W5 STYLE | W2 TRAVEL | FOOD | DRINK | DESIGN | GEAR | PROPERTY | CULTURE | Friday - Sunday, February 28 - March 2, 2014 Ellen floats in space in “Gravity” parody SPORTS WSJ.com/lifestyle Winner thanks spouse over exit music ScarJo as voice from “Her “Her oudspeak dspeaker “Her” on loudspeaker loudspeaker Uncomfortabl Uncomfortable comfortable Uncomfortable Woody Allen reference “American Hustle” hair j joke Lupita Nyong’o looks stunning stunning in bold color unni olor stunning in bold color Joke about ep Meryl Streep being the best ever Somebody does a Matthew McConaughey impression, saying “all right” three times in a row Winner does Namaste hands in acceptance speech Ellen dances Orchestra starts playing five seconds into best sound-mixing acceptance speech A huge mainstream comedy star presents a minor award FREE SPACE Shot of Joaquin aqui Shot of Joaquin Joaquin Phoenix not laughing at jokes Shirley Temple tribute st Best ign ign foreign ge language inne inner ner film winner ird ird has weird hair Self-deprecating Self-deprecating Tom lf-deprecati Self-deprecating Hanks reaction shot On red carpet, actress says she can’t wait to eat a hamburger after this thing is over Awkward attempt to integrate social media into broadcast into broadcast roadcast adca As “12 Years a Slave” discussed on stag iscussed cuss age, is discussed on stage, stage, cut reactions of cut to reactions of eactions ctio unassociated unassociated associat unassociated blac people black people ack ople black peop in crowd rowd crowd Winner kicks off speech by claiming not to have prepared any remarks Ellen riffs on “We Saw Your Boobs” Winner looks into camera and tells children to go to bed ot of Clooney crac Clooney cracking oone Shot of Clooney crac wise in the front row You may not win an Oscar, but you can win at Oscar Bingo! Watch for classic moments and cover squares Photo Illustration by John Kuczala (bingo card); Illustrations by Mitch O’Connell; StarPix/Associated Press (Allen); Columbia Pictures (’American Hustle’); Everett Collection (Temple); Fox Searchlight (’12 Years a Slave); âA.M.P.A.Sđ (statue); Getty Images (5) Star brings mom as his date W2| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL STYLE & FASHION STYLE MANUAL Coats of Many Colors The hottest trend this spring is also the warmest Our guide to the best looks BY TINA GAUDOIN THIS SPRING’S vital addition to your wardrobe isn’t a sandal or a skirt, it’s a coat To be exact, it’s a version of what in my youth we might have called a duster It’s been a long time since fashion has come up with something that is this sensible, so take advantage of the trend and splurge on something new This is one of the rare occasions that makes you think designers might actually be intent on giving us what we want and need in our wardrobes There are two approaches to the season’s must-have purchase: Either you can buy one of the statement, look-at-me coats, which will render you so on-trend that no one will ever again question your sartorial credibility; or you can play it straight with one of the myriad sensible versions on offer, confident in the knowledge that you are bringing home a wardrobe staple Whichever you choose, your coat should be lightweight, but lined (Let’s not kid ourselves that we’re not going to require some protection from the elements—in Northern Europe, at least.) It should also reference modernity It should be soft, either in terms of fabric or cut—or both Try a collarless look if you’re feeling especially fashion-forward; otherwise, go for one of the 1950s swing or ’80s fitted shapes Pay attention to how your coat fastens—a soft tie, a zip, an overt button or nothing at all—because that’s how it’s meant to be worn View your new coat as a warmer, chicer cardigan and wear it much as you would that early noughties staple Pair it with jeans at the weekend, or wear it with a slightly longer dress, cropped pants or, if you are still in the habit, even with shorts for a special occasion These coats finish any outfit That’s the beauty of them If you buy a statement coat, don’t be scared of it This season’s bright floral and geometric patterns are meant to be mixed with other media Wearing one pattern or color in coat form shouldn’t preclude you from wearing another, clashing pattern or color underneath In fact, this season positively encourages it THE FASHIONISTA Lightweight, buttery leather, softly flowing lines and traffic-stopping color If you’re already hesitating, this isn’t for you You cannot purchase an item like this without conviction This Marni coat says “I know what I’m doing”—at least where fashion is concerned Wear it with everything and anything £2,800, marni.com THE TRENDMAKER One of the most photographed pieces of the season, this is a beautiful, classic Stella McCartney product Modern, timeless and chic, wear it with cropped pants and pointy toed flats for an edgy contrast £1,195, stellamccartney.com THE STATEMENT The neoprene, baby blue and floral combo on this Erdem coat give it a modern edge Not for the fainthearted, but definitely for those who think fashion should be fun Particularly fabulous over white for special occasions £1,650, selfridges.com THE ALL-ROUNDER An exquisite color, soft wool and great attention to detail make this the perfect spring work coat That shouldn’t stop you from wearing it to weddings or throwing it over silk pants and a T-shirt for a dinner date on chilly July evenings £395, whistles.co.uk THE NEO-CARDI The perfect example of a functional neocardi, this tweed coat is bang on trend And the price makes it possible for you to experiment with the trend without having to totally buy in Wear it with jeans, or a long fitted skirt and white shirt for work £75, oasis-stores.com THE TRANSITIONAL If I were going to choose one winter-into-spring coat, it would be this Miu Miu piece Slightly chunkier than the other choices here, this coat will keep you warm but won’t look out of place over a lightweight spring outfit £1,745, mytheresa.com THE BOMBER Like the duster, the bomber is everywhere Apply the same cardi-extension principle and wear it with a flared skirt or widerlegged pants £55, topshop.com THE WORK OF ART This Mary Katrantzou coat is the sartorial equivalent of wearing a Ming vase It looks expensive—and it is— but the likelihood of you seeing more than one of these at any special occasion is slim Wear with kitten heels and no jewelry; the coat is all the gilding you need £1,760, harveynichols.com THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | W3 W4| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL Colette BIG SMALL TALK [ THE GOGGLES ] Look ma, no straps! Another small step in the advancement of wearable technology comes in the form of Rollei’s new ski goggles The German camera manufacturer has incorporated a 5-megapixel HD video camera into the goggles, obviating the need to have an extra camera strapped to your helmet Off the piste, trade in your goggles for Rollei’s Sunglasses Cam 200 With a similar 135-degree wide-angle lens and splashproof housing, you won’t miss a shot of your holiday €230, rollei.com JZE [ THE BAG ] Tag, you're it Karl Lagerfeld is no Banksy, but the designer is a prolific urban artist in his own right An insatiable cultural appetite (he is also a photographer, a publisher and a curator) feeds the fashion-forward collections he creates for three labels The most prominent of those, Chanel, is one of fashion’s great bellwethers So you can be sure when Mr Lagerfeld sends something down the runway, it will be a trend coming to a store near you soon Put your own tag on spring’s art-centric look (courtesy of Chanel) with this graffiti-scrawled tote—exclusively at Colette until March €2,590, colette.fr BS [ THE BOOK ] Easy-peasy If you’ve ever felt the urge to read Chinese but found the challenge overwhelming, help may be at hand Technology writer and TED speaker ShaoLan Hsueh has joined forces with renowned illustrator Noma Bar to bring her “Chineasy” system of learning, created for her kids, to a wider audience The system breaks a small number of Chinese characters down into visual building blocks—combining them lets you build enough new characters, words and phrases to read basic Chinese Available March 10; £13, Thames & Hudson LB —With contributions from Lucy Benson, Javier Espinoza, Jamie Z Ewbank, Thorsten Gritschke and Beth Schepens Email BigSmallTalk@wsj.com [ THE LIST ] The Vikings are coming! To the British Museum (from March 6) Before they get there, here are a few facts you should know The Vikings heard London calling long before the Clash In A.D 851, 350 Norse ships traveled down the Thames to attack London Ryanair take note: Viking longships could hold up to 60 men and travel up to 200 km a day Modern-day York, Kiev and Istanbul were once thriving Viking trading settlements Contrary to most modern depictions, Vikings never wore horned helmets Viking king Rollo was the grandfather of William the Conqueror, making the Normans just two generations removed from their ancestral Norsemen Since 1962, Breckenridge, Colo., has hosted the annual weeklong Ullr Fest, celebrating the modern day patron saint of skiers Roskilde IV, a 37-meter-long warship from Seafood with “assorted whey pickled food and taste of Black Death” is offered as a starter at the Fjorukrain Viking Village Restaurant in Iceland TG [ THE LIGHT ] Blazing saddles Despite its looks, the Blaze Laserlight isn’t a lightsaber—it’s a bike light But it does have some “Star Wars”-like qualities: Like R2-D2 with Princess Leia, the light projects an image of a bike onto the road, five to six meters ahead of the rider The message is simple: Inventor Emily Brooke says “it increases a cyclist’s footprint and visibility on the road and alerts drivers ahead of their presence.” Completely waterproof, the light can be charged through any USB power source The battery lasts up to 13 hours and the light can be set at either flashing or constant mode May the force be with you £125, blaze.cc JE [ THE RECORDING ] Absolutely Sweet Dylan In 1992, Japan’s NHK had the foresight to record a concert celebrating Bob Dylan’s 30th anniversary with Columbia Records in high definition, even though few people had use for HD at the time Now, one of most impressive lineups in rock history receives the full-length Blu-ray, DVD and double CD treatment “Bob Dylan - The 30th Anniversary Concert Celebration - Deluxe Edition” features performances by icons such as Lou Reed, George Harrison and Neil Young, and 40 minutes of previously unreleased material Available March 4; from £12 TG The Trustees of the British Museum 1025 that was excavated in 1997, arrived at the British Museum in a flat pack from Denmark THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | W5 EATING & DRINKING ON WINE: WILL LYONS Releasing Barolo’s Potential perfume may attract Asian collectors in the same way Burgundy has in recent years At its best, Barolo possesses an intense ruby color that with age turns a shade of orange These wines, made from the Nebbiolo variety, need 10 years or more to reveal their true personality—which, on the nose, includes violets, dried roses, wild berries and prunes On the palate, they have three key ingredients that make them special: a bright, uplifting acidity, a suave texture not unlike Pinot Noir, and a complex taste that includes cooked fruit, licorice, spice, brambles and earth These are wines that can rival any fine wine One of the reasons I suspect that they haven’t matched the prices of their counterparts in France is that there is no easy-tounderstand classification system in Italy Without the kind of catch- Illustration by Jean-Manuel Duvivier IN CASE YOU MISSED IT, there has been a skirmish in the wine-writing world of late over whether the classics have been overlooked in favor of novelty The debate was sparked last month when American critic Robert M Parker Jr wrote that far too many sommeliers and writers focus on obscure regions and unknown grape varieties These, he argued, don’t quite match up to the established varieties and regions such as Cabernet Sauvignon, Chardonnay, Bordeaux and Burgundy By way of Twitter and blogs, it seems like virtually everyone involved in the wine community has an opinion What I took away from the episode was how many people complained that the classics are no longer affordable Certainly the very best wines of Bordeaux and Burgundy have experienced, and in some cases are still experiencing, unrestrained price inflation La Romanée from Burgundy’s Domaine du Comte Liger-Belair is a good example, rising as high as €25,000 for a case of 12 bottles But there are still plenty of good wines from those regions at around the €18 a bottle mark And while there is fantastic wine to be found almost anywhere that grows grapes these days, the prudent collector will never overlook the classic regions In Europe we are spoiled for choice: if Burgundy and Bordeaux are out of your reach, you can still drive east, across the Alps, to Piedmont Barolo, the red wine made by small artisan producers on the rolling hills of Piedmont, has long been tipped as the next region to experience dramatic price increases Ever since a string of good vintages in the late 1990s, prices have risen—but so far not astronomically Tasting a range of wines from the 2004 and 2006 vintages recently, I was struck by both their quality and, compared with highranking French wine, their price “We’re all waiting for the prices to rise,” says Justerini & Brooks Chairman Hew Blair, who first started importing Barolo into the U.K in the late ’80s Sommeliers such as Yang Lu, wine director for Shangri-La Hotels and Resorts, have noted that their bright acidity, strong tannins and haunting This could be the last affordable vintage of Barolo to hit the market all, thumbnail guide available in, say, Bordeaux, it can be difficult for consumers to understand the country’s top wines Who are the best producers of Barolo? Elio Altare, Poderi Aldo Conterno, Cavallotto, Bartolo Mascarello, Mascarello, Massolino, Sandrone, Paolo Scavino, Vietti and Roberto Voerzio are all in that top bracket In terms of vintages, 1997 was something of a turning point; it was welcomed by critics and sales in Europe increased 2001 and 2004 are both noted vintages, while 2005 and 2007 are also worth seeking out The 2010s will be coming on the market next month Early reports are that the quality is good If this is the case, 2010 could be—as I wrote about Burgundy a few years ago—the last affordable vintage of Barolo to hit the market Find one-minute wine reviews and more at WSJ.com/vintage Email Will at william.lyons@wsj.com or follow him on Twitter: @Will_Lyons 2010 Elio Altare Larigi Langhe Rosso Alcohol: 14.5% Price: £50 or €60 Elio Altare’s Barolos are so popular they tend to sell out quickly But there are some other gems in their portfolio, most notably this lush Barbera made from a single vineyard, Larigi One sniff and you will be immediately seduced by its strong red-fruit aromas 2004 Domenico Clerico Ciabot Mentin Alcohol: 14.5% Price: £78 or €95 Clerico is one of Barolo’s leading estates This wine has all the hallmarks of a classic that will go on drinking for many years Aged in new oak, it’s a big wine with lots of concentrated fruit When sipped, it has a pleasing, mineral taste—but also an exquisite texture chaumet.com Justerini & Brooks (2) DRINKING NOW: PIEDMONTS WORTH SEEKING OUT Liens, the new Chaumet watch W6 | Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL CULTURE 20 ODD QUESTIONS Oscar Ballot PAOLO SORRENTINO Joe Morgenstern weighs in on who deserves to win and who actually will win Readers’ picks are from a WSJ.com poll; odds are from U.K bookmaker Ladbrokes, with the favorites in red Use the ballot to keep score on Sunday night The Italian director on his homeland, elegance and dressing for the Oscars IN “THE GREAT BEAUTY,” Italian film director Paolo Sorrentino uses the grandeur and decadence of Rome as both a metaphor for a man who has lost his way and as a symbol of a country struggling to adjust to a changing world The city’s haunting beauty is the backdrop to the aimless, elegant frivolity of the film’s lead character, Jep Gambardella, an ‘Italy is a perfect aging novelist who spends his days place for inspiration wandering the streets and his nights flitting from one party to the next It’s full of mysteries’ The film has been nominated for the Best Foreign Language Film Oscar But Mr Sorrentino, 43, is already at work on his next project, which, he says, will star Michael Caine He spoke to us in his Rome office about Italy, the nature of elegance and dressing for the Oscars From top, Getty Images; Gianni Fiorito; Slawek Koziol/Alamy; Universal Images Group/DeAgostini/Alamy R “The Great Beauty” is set in Rome because I wanted to give the sense of emptiness and Rome is the perfect city for this It’s a place where you can touch so many different worlds without really grasping any of them Rome is a city that bewilders people It’s a nest of beauty It’s got so much in it—the evanescence, the church, the state, the high society, the bureaucracy It’s got it all and it’s the abundance that makes it impossible to understand I make films because I want to unveil a mystery Italy is a perfect place for inspiration It’s full of mysteries: politics, organized crime, the small-town mentality Italy is a place that is… full of contradictions, which is a perfect source of inspiration for me What’s special about Italy is that it’s a very strange country In the best case, [its strangeness] turns into something extravagant; in the worst case, something dangerous It is not too different from the U.S They both lean toward the unexpected In Italy, it is unbelievable how many beautiful things there are, considering the general backwardness of the country But the beauty overcomes the backwardness and makes it look like it’s not such a big problem Being a director is fun because it’s the best way to not grow up It’s a way to play games for a living, to enter into other people’s lives and embark on new adventures, just like when you were a kid Playing with characters is like playing with dolls It’s the most beautiful game in the world The directors I draw inspiration from are so many Federico Fellini is the main one, particularly for “The Great Beauty” because it strikes a chord and recalls “La Dolce Vita.” But I also like Martin Scorsese and many American directors such as the Coen brothers and Paul Thomas Anderson Being elegant means being selfconfident and relaxed in a nonchalant LIFE IS SWEET From top, Paolo Sorrentino; a still from ‘The Great Beauty’; view over Rome from the Gianicolo hill; a poster for Federico Fellini’s ‘La Dolce Vita’ way Some people are just at ease with whatever they wear, some aren’t Being self-confident is that innate ability to get by in life, to be flexible to changing circumstances Cesare Attolini Attolini is emblematic of a Neapolitan gentleman that is now very rare to find—elegant, bon-vivant who goes on holiday to Capri and who has a British elegance The most elegant people I met haven’t just been in Italy I have met a lot of elegant men in New York and Los Angeles But what is special about Italians is a certain type of elegance that comes from that sartorial tradition typical of Naples and London There are few cities where people are as elegant When I’m not in Italy I miss the feeling of being at home When I get back to Rome, I always go for walks I love the Gianicolo [Janiculum hill] or the road up above Trinità dei Monti, from which you can see the whole city At the Oscar ceremony, I’ll wear an Armani tuxedo Armani has been so kind to give me suits since I made my second film I was completely unknown at the time and he was very generous to me It’s fun You go to the showroom and try clothes until you find the one you like But it doesn’t take a lot of time for me I know already what I want I wouldn’t wear a yellow suit or anything like that What inspired Jep’s look in “The Great Beauty” is Naples’s sartorial tradition In particular, I used the Neapolitan tailor JOE’S PICKS Best Director Alfonso Cuarón ‘Gravity’ Steve McQueen ‘12 Years A Slave’ Alexander Payne ‘Nebraska’ David O Russell ‘American Hustle’ Martin Scorsese ‘The Wolf of Wall Street’ JOE’S COMMENTS SHOULD WILL READER SH ODDS WIN WIN PICKS W The first of his remarkable achievements was convincing a major studio to finance a revolutionary piece of filmmaking with no samples from the film to show 1/25 What qualified a Brit to make a film about U.S slavery? Answer: This world-class filmmaker directed an exemplary drama for the whole world 12/1 He has said that he simply makes small 1970s films like the ones he came to love as a student of the medium Long may the 1970s, or his take on them, continue to flourish 100/ A maestro of manic energy But the energy of this screwball comedy isn’t manic It’s carefully controlled and delicately modulated And he’s a brilliant director of actors 66/1 A master demonstrating, once again, his mastery of the movie medium Exactly what his film adds up to is under debate, but there’s no debating the joy and verve that he brings to his task 100/ JOE’S PICKS Best Actress Amy Adams ‘American Hustle’ JOE’S COMMENTS She’s a lovely chameleon playing a sly chameleon, and she has done so with star presence that’s gracefully subordinated to an ensemble of equals SHOULD WILL READER SH ODDS WIN WIN PICKS 14/1 Cate Blanchett ‘Blue Jasmine’ Perfection from start to finish, yet shadowed by external events that have nothing to with her or her astonishing performance This will be a test of the voters’ maturity 1/25 When I travel, I’m a sort of an antitourist I don’t like to wander around or go to museums I like to go to a place and pretend I live there, going to cafes, looking at people passing by Sandra Bullock ‘Gravity’ The proof of her indispensability is the impossibility of imagining anyone else in the role Anytime you’re failing to appreciate our mother planet, just listen for the longing in her voice 25/1 The perfect film doesn’t exist Even the best directors would say that It’s a miracle if a film ends up making sense at all and the chaos of the creative process is resolved A film must have the glitches and the flaws and the stumbling blocks as well as the beauty, the wonderful and the ecstatic that real life has —Edited from an interview with Manuela Mesco Judi Dench ‘Philomena’ A Dame for the ages, yet a regular dame rooted to her role’s reality, telling a “Skyfall” operative to “take the bloody shot,” or taking a desperate shot here at finding her lost son 33/1 Meryl Streep ‘August: Osage County’ This puts us where we’ve been many times before—happy to have been Streeped by one of her performances, and happy to see her nominated, even if she fails to win 66/1 THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | W7 JOE’S PICKS Best Picture ‘American Hustle’ ‘Captain Phillips’ ‘Dallas Buyers Club’ Roman Muradov ‘Gravity’ YOUR PICKS HOULD WILL WIN WIN ‘Her’ ‘Nebraska’ ‘Philomena’ ‘12 Years A Slave’ JOE’S COMMENTS SHOULD WIN WILL WIN YOUR PICKS READER PICKS Another silver lining for the director and his sensational cast? They’re on a roll in this celebration of the con, of the joys of comic acting and of the enduring delights of screwball comedy ODDS SHOULD WIN WILL WIN Best Supporting Actress Nominees 14/1 Hawkins A struggle for dominance aboard a hijacked ship, in a strong action film dominated by Tom Hanks—no surprise there—and, quite remarkably, a Somali actor with no previous acting experience Lawrence 150/1 A classic tale of a little guy versus giants, except that the little guy is a homophobe diagnosed as HIVpositive in 1985, when Big Pharma and Big Gov are almost clueless about an incipient plague Nyong’o 33/1 Roberts Squibb JOE’S PICKS SHOULD WIN Supporting Actress New Not many movies measure up to the full import of that description, but this one, flying high at the intersecting orbits of drama, the visual arts and pioneering technology, fits the bill WILL WIN Sally Hawkins ‘Blue Jasmine’ Jennifer Lawrence ‘American Hustle’ 9/2 150/1 The hero certainly is a geriatric case, a boozy old coot with a woozily skewed view of reality Yet he’s genuinely heroic in his determination to stagger on 4/6 50/1 50/1 Best Supporting Actor Nominees Abdi Cooper 100/1 Win or lose, justice has already been done by the nominating of this harsh and singularly beautiful film, which has won a place in the pantheon of films that teach while commanding our attention 1/4 Fassbender Hill Leto JOE’S PICKS ‘The Wolf Of Wall Street’ A gleeful satire of excess in the financial/sociopathic sector, or plain old excess in the depiction of bad behavior? It’s hard to keep up with backlashing views of what this hugely energetic film represents YOUR PICKS HOULD WILL WIN WIN Supporting Actor 50/1 JOE’S PICKS Best Actor JOE’S COMMENTS Christian Bale ‘American Hustle’ SHOULD WIN Nothing in his credits predicted the deliciousness of his comic chops, yet here he sustains high levels of hilarity from that opening shot of him combing his hair in front of a mirror Bruce Dern ‘Nebraska’ There’s lots to be said for longevity For the past half century he’s been fascinating us in smaller roles Now his movie-star phase has finally begun Leonardo DiCaprio ‘The Wolf Of Wall Street’ Chiwetel Ejiofor ‘12 Years a Slave’ Matthew McConaughey ‘Dallas Buyers Club A star absolutely ablaze with his character’s gleeful take on swindling almost everyone who crosses his path This is a case of very bad behavior—the character’s—benefiting from extremely good acting It’s a year for splendid actors whose time has finally come Anyone who saw him a decade ago in “Dirty Pretty Things” knew he was headed for greatness The self-regard of his early performances is a far cry from the self-reinvention that has made him a vibrant presence in the current movie scene His vibe in this film is simultaneously thrilling and haunting WILL WIN 5/4 June Squibb ‘Nebraska’ 150/1 A modest movie whose presence here represents at least two disparate things: the effectiveness of an expensive Oscar campaign, and the power of a great actress SHOULD WIN ODDS 25/1 Lupita Nyong’o ‘12 Years a Slave’ Julia Roberts ‘August: Osage County’ A film that updates cherished notions about romantic love This nomination challenges the belief that members of the Academy are geriatric cases YOUR PICKS See clips of the nominated films and vote for your favorites on an interactive ballot at WSJ.com/Oscars WILL WIN YOUR PICKS READER PICKS ODDS SHOULD WIN WILL WIN SHOULD WIN WILL WIN Barkhad Abdi ‘Captain Phillips’ Bradley Cooper ‘American Hustle’ Michael Fassbender ‘12 Years a Slave’ Jonah Hill ‘The Wolf of Wall Street ’ Jared Leto ‘Dallas Buyers Club’ YOUR PICKS ODDS SHOULD WIN 16/1 100/1 14/1 66/1 1/20 JOE’S PICKS 100/1 Original Screenplay SHOULD WIN WILL WIN YOUR PICKS ODDS ‘American Hustle’ 20/1 4/6 ‘Nebraska’ 25/1 JOE’S PICKS Adapted Screenplay SHOULD WIN WILL WIN YOUR PICKS ODDS 16/1 33/1 ‘Philomena’ 1/6 ‘Before Midnight’ ‘Captain Phillips’ 12/1 WILL WIN 33/1 ‘Her’ 5/1 ‘Blue Jasmine’ SHOULD WIN 6/5 ‘Dallas Buyers Club’ 40/1 WILL WIN 7/1 ‘12 Years a Slave’ 1/10 ‘The Wolf of Wall Street’ 20/1 SHOULD WIN WILL WIN Ladbrokes odds and online reader poll results are as of Thursday morning; Warner Bros Pictures (‘Gravity’, ‘Her’); Fox Searchlight (‘12 Years a Slave’); Paramount Vantage (‘Nebraska’); Columbia Pictures (‘American Hustle’, ‘Captain Phillips’); Paramount Pictures (‘The Wolf of Wall Street’); Focus Features (‘Dallas Buyers Club’); Weinstein Co ‘Philomena’, ‘August: Osage County’); Sony Pictures Classics (‘Blue Jasmine’) CULTURE W8| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL Thomas Meyer for The Wall Street Journal (6) MANSION EASTERN COLOR BLOCK With their trademark use of bold color, architects Matthias Sauerbruch and Louisa Hutton have transformed an unloved East Berlin factory floor into a light-filled home BY J.S MARCUS DESIGN DUO Louisa Hutton and Matthias Sauerbruch; above, the sitting area features furniture created for the couple’s Brandhorst Museum in Munich A WALK DOWN Linienstrasse, in the heart of eastern Berlin’s historic Mitte district, offers a whistle-stop tour of the city’s architectural styles, from early Prussian industrialism to late Eastern Bloc Modernism But in the mid-1990s, when the area was still awaiting the full effect of German reunification, there was only one predominant style—decrepitude Nonetheless, two local architects, husband-and-wife team Matthias Sauerbruch and Louisa Hutton, saw potential glittering in a Linienstrasse ruin, and in 1997 they bought an uninhabited factory floor, dating back to the early 19th century, and went about creating a one-of-a-kind home The couple, then living in west Berlin, spotted the apartment in a newspaper ad When they went to see it, Ms Hutton recalls, squatters occupied part of the building “There were tea bags hanging from the ceiling,” she says Even so, “you could see the potential very easily” of the wrecked but sprawling 4th-floor loft, with four exposures that allowed “the sun and the views to coincide.” At the time, British-born Ms Hutton, now 56 years old, and German-born Mr Sauerbruch, 59, were on the brink of international acclaim Founding partners in the Berlin firm Sauerbruch Hutton, now known for combining an innovative approach to sustainable architecture with an eye-catching use of color, they were hard at work on their breakthrough project, the city’s GSW headquarters, an elegant complex of structures completed in 1999, the year they finished renovating their new apartment The 2-bedroom, 2-bathroom apartment measures 190 square meters, with an east-facing master bedroom that greets the morning Before the couple moved in, ‘there were tea bags hanging from the ceiling’ sun, and a south- and west-facing, open-plan living and dining area that captures the last bit of daylight These adjoining larger areas are separated from an array of smaller rooms, including his-andhers studies and a guest bedroom, by a 17-meter-long wall Painted with an atmospheric color grid that recalls the elaborate facades of their buildings, the wall brought the couple’s colorful style indoors for the first time “We hadn’t used color to transform a space before,” Ms Hutton THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | W9 MANSION SUNNY DELIGHT The dining area has southern and western exposures TOP TIPS UNFINISHED BUSINESS Despite moving in almost 15 years ago, Mr Sauerbruch and Ms Hutton have never entirely finished their apartment Paintings lean against the wall, ready to be hung, for instance Leave some details of your own home open-ended, so you can adjust the spaces over time THE ART OF CLUTTER Use visible surfaces for decoration, rather than storage The couple keep drawers and closets out of sight but decorate surfaces with significant objects HOME COMFORT Eileen Gray’s classic Bibendum chair sits in their bedroom; Above, the colored wall conceals storage CLEAN LINES The freestanding, legless bathtub is a U.K import says Reds, pinks and oranges dominate, a palette only finalized during the actual painting “The original design had more range,” says Ms Hutton, “from almost blue to almost yellow On site it got a bit softer.” At first glance, the color grid seems to dominate the apartment—until you look down and notice the dramatic, dark floors, made of unstained wenge, a tropical hardwood The darkness of the wood allows daylight “to make a big impact,” says Mr Sauerbruch “In the summer, it’s beautiful,” he says, because of the contrast; in winter, “when it’s really dull and dark outside,” a fireplace “creates pools of light” on the floors The apartment has evolved over time Now, the sitting area is punctuated by cognac-colored leather furniture, designed by the couple for with their 2009 project, Munich’s Brandhorst Museum Before that, they had used pieces by Le Corbusier, daringly substituting the standard-issue monochrome leather for what Ms Hutton calls “the pinks and greens of English chintz.” And, some three years after moving in, they added a conspicuous island storage unit, placed strategically between the sitting area and the colored wall “Without this new piece,” Ms Hut- ton says, “the room was too deep.” The master bedroom suite contains myriad bespoke details Mirrored sliding doors separate the sleeping and bathing areas, and the suite is packed with discreet built-in cabinets and drawers— some built into the colored wall Is the lack of visible storage a spacesaving device or an aesthetic decision? “Both,” says Ms Hutton The bathing and dressing area contains a free-standing tub, imported from the U.K., that sits flush against the floor, with a faucet hidden away on the side The couple like the sleekness, and a similar tub will follow them to their next home—the top floor of a new Sauerbruch Huttondesigned apartment house, not far from their office in west Berlin’s Moabit neighborhood They plan to move in at the end of the year Like their current home, the new penthouse will have views on all sides, but with space for a library and a much larger guest suite And like the Linienstrasse apartment, the new one will be a work in progress “Even though we’re the architects, it won’t be exactly how we want it when we move in,” Ms Hutton says “In the end, how a space feels has so much to with how you use it— how you leave things lying around, how you inhabit it.” PIECES RATHER THAN PERIODS Choose furniture according to how it looks in a space, rather than because the designer or period seems appropriate For the bedroom, the couple selected Eileen Gray’s 1900s Bibendum chair “We liked its generosity as well as its boudoir feel,” says Mr Sauerbruch W10| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL MANSION F Martin Ramin for The Wall Street Journal, Styling by Anne Cardenas WHY MUST MUGS BE MAMMOTH? In praise of the charming, civilized—and newly trendy—small coffee cup THE STANDARD SERVING size with most coffee makers may be 180 mL, but the cups on our shelves are routinely double, triple, even quadruple that The sad result: an epidemic of jitters and lukewarm java Blame it on supersizing or the Starbucks effect But it wasn’t always this way: Before the 1950s, coffee was almost always served in petite cups that, incidentally, discouraged people from adding heaps of sugar and cream and encouraged them to savor the flavor while the brew was still hot As coffee culture shifts toward the slow and small-batch (think pour overs and press pots, singleorigin beans and specialty roasters), the small mug is poised for a comeback Tableware designers are again playing with scaleddown forms—giving coffee drinkers who crave modest proportions more attractive options than ever Styles run the gamut from subdued to exuberantly avant-garde Canvas’s simple white Abbesses mug features a discreetly colored rim A collaboration between John Derian and Astier de Villatte—a hand-formed cup with a faux-marble interior—has the one-of-a-kind luxury of a family heirloom For a more out-there look, ceramic artist Peter Shire of Echo Park Pottery has designed a slab-style mug with a trippy, spattered exterior that’s a cheeky homage to Abstract Expressionist painter Sam Francis Size was certainly among British designer Sebastian Conran’s top concerns when he created cups for his Universal Expert series of kitchenware “I wanted something that felt balanced, with a neutral sort of elegance that would fit in anywhere at any time,” he says The result was a stacking set of simple white porcelain cups, playfully accented with pops of color on the handles and paired with matching lids that double as saucers Their size, though moderate (260 mL), never feels stingy—just the opposite: By leaving more coffee in the pot for others, compact mugs like these seem to encourage sharing “Small cups are just more social,” says Mr Conran Sami Ruotsalainen, the Finnish designer responsible for Marimekko’s charming, diminutive mugs, agrees “Finnish coffee cups have traditionally been very little, so partly I kept my designs small in honor of that history—but I also wanted to remind people they don’t always have to drink and run,” he says “A little cup says, ‘Sit down, take a moment.’ ” —Sarah Karnasiewicz LITTLE SIPPERS Clockwise from top: Abbesses Mug, $12/€9, canvashomestore.com; Echo Park Pottery Mug by Peter Shire, $46, hickorees.com; Universal Expert Mug, £49 for four assorted, westelm.co.uk; Mug, €17, marimekko.com; Astier de Villatte Mug, $204, johnderian.com ADVERTISEMENT Champaign/Urbana, iLLinOiS NAPLES, FLORIDA PLEASANTON, CALIFORNIA This incredible bedroom English style Arts & Crafts Country Manor is hours south of Chicago and minutes from the University of Illinois Champaign Urbana campus Offered turnkey, this truly luxurious home is on 217 acres with a full log guest house Contact Kurt Penn Exquisite bedroom home plus den with panoramic lake and golf course views with open floor plan with extensive upgrades and gourmet kitchen with gas cooking, stainless appliances and granite counters Expansive outdoor living with saltwater pool and spa overlooking endless views Located in awardwinning community with dining, fitness, tennis, golf, beach club and marina Own your own vineyard estate home! Spectacular vineyard estate home on a 1-acre home site among acres of your own vineyards within the Livermore Valley Wine Country This one-of-a-kind Toll Brothers home boasts 6,150 sq ft., BR, 4-1/2 BA, 6-car garage, a library, private second floor balcony, plus an inviting BR, 748 sq ft guesthouse Many other luxury features included! $929,000 Priced in the upper $2 millions $9,950,000 www.jamesonsir.com www.michelle-thomas.com Jameson Sotheby’s International Realty Premier Sotheby’s International Realty Michelle Thomas JAMESTOWN, RHODE ISLAND New york, Ny - 107 east 91st street The Dallas Texas suburb of las Colinas “BOULDERS” Featuring views across Narragansett Bay to Newport’s harbor front, this quintessential turn of the century Charles Bevins’ designed summer cottage offers a beautiful landscape with English gardens and a lily pond Interiors feature distinctly detailed wooden doors, wainscoting, inlaid floors, and six fireplaces Master bedroom suite includes a sitting room and his and her bath Minutes to Newport Sunny five-story brick Georgian-style Townhouse off Park Avenue on lovely tree-lined street Features a dramatic semi-circular winding staircase and extensive spaces to hang art Priced under $1,900/sq ft, this home has bedrooms, 1/2 bathrooms, a new kitchen, dining room, wood burning fireplaces and a terraced garden Close proximity to New York City’s finest schools Approximately 4,300 square feet Perfect central US base for busy, traveling executive with family Completely updated and in move-in condition bedrooms with 5.5 baths in 5,550 square feet on the 16th fairway of private golf course Pool and guest house with sauna Within private, gated and guarded community Only 16 minutes to DFW International Airport, 20 minutes to Love Field phone: 773.206.0302 $3,495,000 By Toll Brothers kurt.penn@sothebysrealty.com LilaDelman.com phone: 401.423.3440 phone: 239.860.7176 michelle.thomas@sothebysrealty.com http://liladel.re/boulders $7,750,000 email: Details@LilaDelman.com Matthew Pravda phone: 212.371.8200 x 24 mpravda@lesliegarfield.com To Advertise Call: +44 (0) 207-572-2124 The Reserve at Pleasanton by Toll Brothers phone: 866.306.2113 TheReserveAtPleasanton.com/WSJ $998,000.00 Virginia Cook Realtors Ken Rusnak phone: 214.707.5248 flyer4004@aol.com THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | W11 ADVERTISEMENT JOHN’S ISLAND – VERO BEACH, FLORIDA TAMPA AREA, FLORIDA MIDDLETOWN, RHODE ISLAND This meticulously renovated 4BR/4.5BA residence with 1BR/1BA guest cottage is set back from the road with very private waterfront and wetland views Unsurpassed features include a voluminous living room with fireplace, vaulted beamed ceiling family room & gourmet island kitchen, luxurious master suite, new bathrooms, spa/pool, and boat dock Florida’s Best 55+ Resort Lifestyle at Valencia Lakes – is easily accessible from both Tampa and Sarasota A lifestyle director offers clubs, events, shows and activities in a 27,000 sq ft clubhouse Enjoy pools, bistro, fitness and everything from tennis to softball and more with new villas and single-family homes from the $180’s - $400’s Try before you buy Stay & Play for days and nights for $99! “SENTOSA” WATERFRONT acre site invites quiet relaxation and gracious entertaining Extraordinary light-filled rooms offer beautiful views and include a spectacular great room with coffered ceilings and a floor to ceiling fieldstone fireplace; a gourmet kitchen; first level master suite; and additional en suite bedrooms Elevator, expansive porches with stone fireplaces and 178’ of shoreline with beach Minutes to Newport beaches John’s Island Real Estate Company GL Homes Lila Delman Real Estate International LAGUNA BEACH, CALIFORNIA BOCA/DELRAY BEACH, FLORIDA Spring iSland, South carolina A view for miles Oceanfront location in the private, gated community of Emerald Bay, this Italianate-style residence features panoramic coastline and ocean views from three floors Nearly 7,000 sq ft almost new home is thoughtfully arranged to optimize these views The main entertaining and living areas open to broad oceanfront terraces and gardens Private beach, an idyllic climate and the best amenities in Southern California Incredible opportunity at The Bridges - brand new homes in a highly amenitized non-golf community in the Boca Raton / Delray Beach area Generous features include impact glass, marble countertops, gourmet kitchens and 17,000 sq ft club Low HOA fees, close to world-class shopping, great schools Inquire today! 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Glorious, historic 1.8 acre estate in the heart of Silicon Valley The 9,322 sq ft home includes bedrooms, bathrooms, formal dining and living room, family great room, butler’s pantry, library, office, fireplaces and wine tasting room Landscaped grounds include guest quarters, outdoor kitchen, bocce ball and putting green Experience the very best of Southern California coastal living at Brightwater, a refreshingly unique community offering spectacular Pacific Ocean and preserved wetlands views Discover that rare jewel of a home you’ve been searching for in one of our three sparkling new neighborhoods World Class Location Just minutes to the beach and luxury shopping 45 minutes from two International Airports phone: 949.933.7046 $2,795,000 John M Jeffs phone: 831.251.2050 email: rob@robgiem.com www.kaweah-riverranch.com john@mosaicproperties.us phone: 866.740.0400 phone: 800.875.2179 $11,250,000 Homes2Buy.com Nancy MacLeod phone: 650.888.5276 www.paloaltogem.com nancypaloaltorealtor@gmail.com To Advertise Call: +44 (0) 207-572-2124 Email: info@springisland.com Priced from $1.1 to $2.8 million Brightwater Sales Offices phone: 888.235.9751 www.brightwaterhb.com W12| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL Illustration by Zohar Lazar for The Wall Street Journal GEAR & GADGETS THREE SECRETS OF ‘THREES!’ What makes this new hit game impossible to put down? Its creator, Asher Vollmer, explains how he transformed what looks like a grade-school math work sheet into a chart-topping title “Threes!” involves finding adjacent twin numbers (a six and a six, for example) and sliding them on top of each other—a pattern-finding process that the brain finds pleasurable Once Mr Vollmer decided on this rule, “suddenly the game changed and kept being interesting from beginning to end,” he says RESISTANCE TO THESE GAMES IS FUTILE The best smartphone diversions drive you crazy in all the right ways BY MATTHEW KRONSBERG A FEW WEEKS AGO, the creator of “Flappy Bird” removed the popular smartphone game from the Apple and Android stores because, he said, “it was just too addictive.” Anyone who’s ever missed a subway stop while playing “Candy Crush Saga” or let dinner burn to squeeze in one more round of “Tetris” can probably relate These games can be nearly impossible to put down What exactly makes them so compelling? While theories abound, most agree that each time you clear away a pattern of dots or knock down a porcine encampment, your brain releases a little dopamine rush—a surge of pleasure sufficient to make you want to it again Below, four impossible-to-resist features that experts say your brain is hard-wired to want more of, and new titles that you’ll love to hate to play AXIOM OF IRRESISTIBILITY: WE’RE SUCKERS FOR A FACE Give a carrot facial expressions and strange things happen “When something has a face, we find it much harder to give up, or get rid of We are sort of hard-wired into that,” says Karen Collins, a professor at the Games Institute of the University of Waterloo in Ontario, Canada “We know logically that these things are not real, but there is still an emotional connection there In ‘Farm Heroes,’ something in our brains says, ‘We can’t just abandon these little farm vegetables!’ ” Cute voices work, too Think of the “whee!” an Angry Bird makes as it’s launched from a slingshot “I don’t think ‘Angry Birds’ would have been as successful had it not been so well anthropomorphized,” says Charles Mauro, a human-factors engineer who has written extensively about smartphone games Your New Addiction: In “Machinarium Pocket Edition” (£2, available for iOS), the bug-eyed junkyard robot will elicit the same affection you felt for Pixar’s WALL-E You’ll obsessively help him navigate a dystopian landscape to rescue his girlfriend, Berta AXIOM OF IRRESISTIBILITY: FINDING PATTERNS IS FUN When you spot a block of identically hued shapes clustered in an otherwise random field of colored elements—whether the pastel circles of “Dots” or the glittery gemstones of “Bejeweled”—it’s essentially the modern-day equivalent of spotting a clutch of berries hidden in a bush According to Mr Mauro, humans have evolved to process patterns in an environment before they notice specific details, and these games tap into that Judy Willis, a neurologist who specializes in the neuroscience of learning, says that we derive pleasure not only from finding patterns but from seeing the possibility of patterns In “Candy Crush Saga,” for example, two pink candies next to each other don’t form a pattern, but they are close enough together to make you predict (or hope for) the presence of a third, in an adjacent space If one is there, the result is pleasure “Pattern seeking is all about making good predictions,” says Dr Willis “The videogame that’s going to get the most repetitious play is the one that has frequent opportunities to make predictions and get immediate feedback.” Your New Addiction: Instead of jewels or colorful dots, “Threes!” (£1.49, available for iOS) has numbers, arrayed on a grid, that you rejigger and merge As the numbers go up, so those dopamine levels AXIOM OF IRRESISTIBILITY: WE LOVE HONING OUR SKILLS— EVEN SILLY ONES To quote Samuel Beckett, “Try again Fail again Fail better.” If a game is too easy to master, you’ll quickly lose interest If it’s too hard, you’ll give up prematurely The most engaging ones let you fail better with each turn—satisfying the deep desire we all have to improve at a skill Take “Angry Birds.” When you launch a bird into the air, it leaves a dotted trail in its path—a marker that you can use to fine-tune your aim on the next turn According to Mr Mauro, that trail is essential to the game’s success “[It] lets you say, ‘I want to go on to the next try here, because I learned something from the previous try.’ ” That not-too-hard, not-too-easy sweet spot is what Dr Willis calls “achievable challenge.” While we like to think it’s self-determination that makes us want to outdo ourselves, there’s more to it, says Dr Willis: Succeeding at a challenge—no matter how small—triggers a dopamine boost Your New Addiction: The puzzles in “The Room Two” (£1, available for Android and iOS) get trickier as you progress—but carefully calibrated hints ensure that each puzzle remains an “achievable challenge.” These aren’t impersonal numbers They’re little digit people, who giggle and blurt out sounds as you move them about The higher the numbers (and your score), the more expressive the faces under each number become AXIOM OF IRRESISTIBILITY: WE ENJOY EXPLORING DIGITAL WORLDS THAT MIMIC THE REAL ONE From the first time you pushed a bowl of Cheerios off your high chair, you understood physics And you come to every digital game with that basic understanding of the world in mind “It’s much easier for people to connect with a piece of software when they feel like it’s closer to the real world than the digital one,” says Asher Vollmer, creator of the game “Threes!” and former designer at thatgamecompany Mr Mauro agrees: “When a familiar behavior is accurately mimicked digitally, like the pullback of a slingshot in ‘Angry Birds,’ in 15 seconds, players have a basic mental model of the mechanics of the game.” The games that best mimic the physical world aren’t just more fun, they’re easier to learn, making it less likely you’ll delete it in frustration Your New Addiction: You’ll immediately understand the rules of “Cut the Rope: Time Travel” (Free, available for Android and iOS) even if you’ve never played earlier versions in this popular series Cut the ropes to feed a cute green monster the candy that’s by ever more complex rigging The rectangles that you push around the screen sometimes stretch and snap back into shape to convey a sense of elasticity Before Mr Vollmer implemented this—an example of what game designers call “adding juice” to an interaction— players had trouble figuring out what they were supposed to The game was “basically unplayable to the average Joe,” he says ... THE WALL STREET JOURNAL Friday - Sunday, February 28 - March 2, 2014 | 11 IN DEPTH (Top to bottom) Agence France-Presse/Getty Images; Hisashi Murayama for The Wall Street Journal collective ranks,... 0.03069 a-floating rate b-financial c-government rate c-commercial rate d-Russian Central Bank rate Source: ICAP Plc 24| Friday - Sunday, February 28 - March 2, 2014 THE WALL STREET JOURNAL BLUE CHIPS... THE WALL STREET JOURNAL Thomas Meyer for The Wall Street Journal (6) MANSION EASTERN COLOR BLOCK With their trademark use of bold color, architects Matthias Sauerbruch and Louisa Hutton have transformed