Eurozone output contracts again; HMV calls in administrators; Diverging roads to Kabul; The emperor has no lungs

1 Eurozone output contracts again (BBC) Output from eurozone factories fell by 0.3% in November, according to the latest official figures from EU body Eurostat. The drop marks the third successive month of decline. The fall comes in spite of analysts' forecasts of a rise and means production is now 3.7% lower than a year ago. However, the pace of decline is slowing, and November's fall compares to a 1% drop in October.

The eurozone countries which saw the sharpest falls in November on a monthly basis were Portugal, where output fell 3.4%, and Spain, which saw a 2.5% drop. Despite the falls, which are an indicator of lower economic activity, analysts said there were signs that the worst was over. "The worst is behind us. We believe that the euro area will exit recession in the first half of this year," said David Mackie, an economist at JP Morgan. "The risk of a eurozone break-up was a major drag on businesses last year, but this year we are beginning to see some stabilisation," added Ulrike Rondorf, an economist at Commerzbank. 

2 HMV calls in administrators (Simon Bowers & Jill Treanor in The Guardian) For HMV, Britain's last major high street DVD and CD chain, the music is about to stop. Nipper, the mascot dog who has looked quizzically down the gramophone trumpet in store windows for more than 90 years, will no longer hear His Master's Voice.

The company that opened its first shop on Oxford Street in 1921 is expected to call in administrators from Deloitte as the 250-strong chain becomes the latest casualty in the battle between online and traditional shops, bringing uncertainty for a workforce of more than 4,500 at 240 HMV stores and nine Fopp outlets.

Andrew Sentence, the music fan and economist, last night suggested there could be more high street failures as internet firms continue to take business from traditional shops. "Comet & Jessops: now HMV. Is there more trouble in store?" the former member of the Bank of England's rate-setting committee, tweeted. "Since 2007, the [internet's] share retail sales (excluding motor fuel) has risen from less than 4% to over 10% – with internet spending growing at around 25% per annum in value terms."

HMV is arguably the highest-profile name to collapse during the prolonged economic down turn and changing shopping habits that also forced Woolworths out of business five years ago at the start of the banking crisis. Ironically the collapse of Woolworths had initially helped HMV which enjoyed a peak in sales shortly afterwards before the competition escalated from supermarkets and online retailers.

3 Diverging roads to Kabul (Thomas Barfield in Khaleej Times) In the 19^th century British India and Czarist Russia both preserved and clashed over Afghanistan as a buffer state between their respective colonial empires. In the 20^th century Afghanistan became a proxy battleground in the Cold War. And Afghanistan opened the 21^st century under Taleban rule, hosting Osama bin Laden who organised a terrorist attack on the US. The culmination of each of these geopolitical rivalries was one or more foreign invasions, foreign occupations and foreign withdrawals, of which the 2014 departure will be the fourth for Afghanistan since 1841.

Many analysts assume disorder will ensue with the American withdrawal and predict quick victory for the Taleban over a weak Karzai government in Kabul. Afghan history suggests otherwise. Afghan rulers installed by an invading foreign army fail, but those installed by a withdrawing foreign army succeeded. Only in the absence of any Great Power partnership did Afghanistan fall into anarchy, such as the decade-long civil war in the 1990s that brought the Taleban to power. Such devolution into civil war rather than Taleban victory is the more likely scenario if Afghanistan falls into political violence.

It could take a number of forms. Nuclear-armed Pakistan and India could bring their rivalry into Afghanistan to fight a proxy war with Pakistan supporting the Taleban and India backing the Kabul government. Or, Afghanistan regions could revive their militias and turn a two-party war into a free-for-all. Or the Central Asian states, Russia, India and Iran could back a two-state solution that splits the non-Pashtun north, west and center from the Pashtun south and east, leaving Pakistan with a supersized Federally Administered Tribal Areas.

The Afghan government plays only a passive role in these developments. Other than balancing out its mineral contracts with both India and China, it has displayed no strategic vision. If Afghanistan wishes to become another Dubai rather than another Somalia, it needs imaginative leaders who offer an economic vision that offers hope to people who have already suffered too much.

4 The emperor has no lungs (The Wall Street Journal) When Beijing city authorities say the air is hazardous and advise people to stay indoors, you know it's serious. After years of denying the obvious, officials issued their first ever "orange alert" health warning for smog on Sunday. But a one-time admission doesn't mean the end of cover-ups or the beginning of a government push to correct the problem.

The Beijing government expanded its air monitoring a year ago, a small concession to public demands for greater transparency. The numbers released over the last five days have been shocking. The state-run Xinhua news agency reported that at several monitoring stations the concentrations of particles below 2.5 microns in diameter—the most dangerous kind—exceeded 700 micrograms per square meter. For context, the World Health Organization specifies a PM2.5 level of 25 micrograms per square meter as the safe limit. When the level rises above 300, children and the elderly should not go outside.

One virtue of democracy is that it forces governments to be accountable on such basic issues as public health. The US and other developed nations have had pollution problems, though rarely as bad as China's. Yet the political system responded, often imperfectly and by imposing more costs than necessary, but enough to clear the air. Without open government and accountability, Beijing's air can get crazier. What will it take for officials to declare a red alert?