BERN, Switzerland — Secretary of State Mike Pompeo is on a weeklong trip to Europe where he is raising sensitive issues with national leaders — from Iranian missiles to Chinese technology to the economic collapse of Venezuela — but the most colorful conversations could take place this weekend out of public earshot in a secretive conclave at a Swiss lakeside resort.
In Montreux, on the eastern shore of Lake Geneva, political and business leaders from Western nations are gathering for the 67th Bilderberg Meeting, an annual forum in which participants agree not to reveal exactly what was said or who said it. It is a shadow version of Davos, the elite annual winter conference in the Swiss Alps that President Trump has attended once but has also criticized.
The State Department has not even put the Bilderberg Meeting on Mr. Pompeo’s public schedule, though a senior official confirmed he was attending Saturday.
.. No doubt those culinary treats will be on hand at venues in Montreux, to fuel discussion on 11 central topics now hotly debated in countries around the globe:
- the future of capitalism,
- the weaponization of social media,
- artificial intelligence,
- Russia and so on.
Jared Kushner, Mr. Trump’s son-in-law and Middle East adviser, is another top administration official planning to attend. The 130 or so participants also include King Willem-Alexander of the Netherlands; Stacey Abrams, the American politician; Henry Kissinger, the former senior American foreign policy official; Eric Schmidt, the former chief executive of Google; and David H. Petraeus, the retired general. Some top bank executives are on the list, too.
On at least one subject, climate change, many of the participants are expected to have radically different views than Mr. Pompeo. In early May, the American secretary, speaking at a meeting of the Arctic Council in Finland, praised the changes caused by the melting of ice in the Arctic Circle.
“Steady reductions in sea ice are opening new passageways and new opportunities for trade,” Mr. Pompeo said, while noting the abundance of undiscovered oil and gas, uranium, rare-earth minerals, coal, diamonds and fisheries in the Arctic.
What Mr. Pompeo, Mr. Kushner and the other Bilderberg attendees actually say to each other will be a mystery to most of the public, thanks to the meeting’s use of the Chatham House Rule, which states that although attendees can tell the public what was discussed, generally, participants must not reveal who said what.
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Policy U-turns from the Fed and ECB are cascading around the world
Abrupt changes in the policies of the world’s largest central banks have rippled through smaller economies, leaving them with the prospect of low and even negative interest rates for years to come despite having mostly healthy economies.
The danger is that these easy-money policies could fuel destabilizing bubbles in real estate and other asset markets. They may also leave banks with little ammunition to respond to the next economic downturn.
Economies like Switzerland’s, whose central bank signaled no change in its negative-rate policies for years to come, are small compared with the U.S. and eurozone. Still, they are home to major global banks and companies that are sensitive to exchange rates and financial conditions. With financial markets so interconnected, problems in small countries can quickly spread to larger ones.
.. The Swiss National Bank said Thursday that it would keep its policy rate at minus 0.75%, where it has been since January 2015, and reduced its inflation forecast to 0.3% this year and 0.6% in 2020. The SNB cited weaker overseas growth and inflation and “the resulting reduction in expectations regarding policy rates in the major currency areas going forward.”
.. Here’s why Fed and ECB decisions matter for countries that don’t use the dollar or euro: Switzerland and countries near the eurozone but not part of it—like Sweden and Denmark—rely on the bloc for much of their exports and imports. That makes growth and inflation highly dependent on the exchange rate. Central-bank stimulus tends to weaken a country’s exchange rate, so when the ECB embraces easy-money policies as it did two weeks ago it tends to weaken the euro against other European currencies such as the Swiss franc. Because the ECB is so large, Switzerland and others can do little to offset it.
.. “They are hostage to the fortunes of what the ECB does,” said David Oxley, economist at Capital Economics.
.. “The gravity pull is very strong” from the Fed and ECB, said Sebastien Galy, macro strategist at Nordea Asset Management. “The consequence is [non-euro central banks in Europe] mostly end up importing policy from the ECB, so you end up with housing bubbles and a misallocation of capital.”
Urs Hölzle (German pronunciation: [ˈʊrs ˈhœltslɛ]) is a Swiss software engineer and technology executive. He is the senior vice president of technical infrastructure and Google Fellow at Google. As Google’s eighth employee and its first VP of Engineering, he has shaped much of Google’s development processes and infrastructure
.. Before joining Google, he was an Associate Professor of Computer Science at University of California, Santa Barbara. He received a master’s degree in computer science from ETH Zurich in 1988 and was awarded a Fulbright scholarship that same year. In 1994, he earned a Ph.D. from Stanford University, where his research focused on programming languages and their efficient implementation. Via a startup founded by Hölzle, David Griswold, and Lars Bak (see Strongtalk), that work then evolved into a high-performance Java VMnamed HotSpot, acquired by Sun’s JavaSoft unit in 1997 and from there became Sun’s premier JVM implementation.
He led the design of Google’s very efficient data centers which are said to use less than half the power of a conventional data center. In 2014 he received The Economist’s Innovation Award for his datacenter efficiency work. With Luiz Barroso, he wrote The Datacenter as a Computer: An Introduction to the Design of Warehouse-Scale Machines. In June 2007, he introduced the Climate Savers Computing Initiative together with Pat Gelsinger which aims to halve the power consumption of desktop computers and servers.
Also in 2007, he and Luiz Barroso wrote “The Case for Energy Proportional Computing” which argued that servers should be designed to use power in proportion to their current load, because they spend much of their time being only partially loaded. This paper is often credited for spurring CPU manufacturers to make their designs much more energy efficient. Today, energy proportional computing has become a standard goal for both server and mobile uses.
In 2011, Hölzle announced a shift in Google.org’s alternative energy investment strategy, dropping development of “solar thermal” electricity (for example with BrightSource Energy) because ST was not keeping pace with the rapid price decline of another solar technology – photovoltaics.
In 2012, Hölzle introduced “the G-Scale Network” on which Google had begun managing its petabyte-scale internal data flow via OpenFlow, an open source software system jointly devised by scientists at Stanford and the UC Berkeley and promoted by the Open Networking Foundation. The internal data flow, or network, is distinct from the one that connects users to Google services (Search, Gmail, YouTube, etc.). In the process of describing the new network, Hölzle also confirmed more about Google’s making of its own networking equipment like routers and switches for G-Scale; and said the company wanted, by being open about the changes, to “encourage the industry — hardware, software and ISP’s — to look down this path and say, ‘I can benefit from this.'” He said network utilization was nearing 100% of capacity, a dramatic efficiency improvement.
He is member of the National Academy of Engineering, and a Fellow of the Association for Computing Machinery (2009), the AAAS (2017), and the Swiss Academies of Arts and Sciences. He is also a board member of the US World Wildlife Fund.