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Archive for the ‘Banking and Finance’ Category

Will Japan Regain Its Greatness?

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By Michael Shari

Business is trying to resurrect Asia’s economic miracle a year and a half after the Tohoku tragedy. Tokyo is enjoying a long-deserved renaissance. Young professionals are converging from all across the Japanese archipelago, driving the population of the Japan’s capital up by about 1 million people, to about 12.5 million, since 1995, while the nation’s population has leveled off at about 128 million since 2004. Cranes are swinging over gaping construction sites citywide thanks to relaxed building height restrictions, defying occasional tremors and transforming the city into a showcase for displays of cutting-edge 21st century architecture. Opened in May was the 634-meter (2,080-foot) Tokyo Skytree, the tallest tower in the world.

“This economy is pretty similar to that of Florence, Italy, in the Renaissance era,” says Hitoshi Itagaki, president of Principal Global Investors, recounting how Italian peasants and artisans who survived bubonic plague flocked to Florence where public services still functioned. “They created a really beautiful Renaissance culture, and the same phenomenon is happening in Japan.” Read the rest of this entry »


Written by Theophyle

September 2, 2012 at 12:39 pm

Financial Markets, Politics and the New Reality

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Financial Markets, Politics and the New Reality is republished with permission of Stratfor.”

By George Friedman

Louis M. Bacon is the head of Moore Capital Management, one of the largest and most influential hedge funds in the world. Last week, he announced that he was returning one quarter of his largest fund, about $2 billion, to his investors. The reason he gave to The New York Times was that he had found it difficult to invest given the impossibility of predicting the European situation. He was quoted as saying, “The political involvement is so extreme — we have not seen this since the postwar era. What they are doing is trying to thwart natural market outcomes. It is amazing how important the decision-making of one person, Angela Merkel, has become to world markets.” Read the rest of this entry »

Written by Theophyle

August 10, 2012 at 9:14 am

WSJ-E: France is Main Obstacle to a Euro Solution

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Two statements last week following the four-way summit in Rome between the German, French, Italian and Spanish leaders capture the essence of the euro crisis and show why a solution is as far away as ever. Responding to the latest demands that euro-zone bailout funds be allowed directly to recapitalize Spanish banks, German Chancellor Angela Merkel replied: “If I give money to Spanish banks, I’m the German chancellor but I can’t say what these banks do.” Later, French president François Hollande was asked about his willingness to accept further political union as the price of greater pooling of debt, he replied: “There can be no transfer of sovereignty if there is not an improvement in solidarity.” Boiled down, this is a debate over whether Germany should write blank checks. Read the rest of this entry »

Written by Theophyle

June 25, 2012 at 8:46 am

The Economist: Dithering in the dark

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Quantifying the effect of political uncertainty on the global economy

Europe teeters at the edge of an economic abyss, its fate in the hands of political leaders at odds over how to solve the continent’s twin debt and bank crises. America may be pushed over a “fiscal cliff” at the end of the year by political dysfunction. And even China, although unlikely to take a deep dive, is hostage to the will and ability of its government to stimulate growth. More than at any point in recent history, the global economy’s fate is tied to the capriciousness of policymakers. How much does such uncertainty cost?

Anecdotal evidence suggests that it costs a lot. Customers of Cisco Systems, the world’s biggest maker of internet gear, are taking longer to make decisions, according to John Chambers, the company’s boss. Their orders tend to be smaller than before, and to require more in-house approvals. They say they are planning to buy more stuff later this year, reported Mr Chambers recently, but “then in the very next breath they say it depends on what happens on a global and macro scale.” Read the rest of this entry »

Written by Theophyle

June 19, 2012 at 8:52 am

The WSJ-E: World Braces For Test of Euro

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By Stephen Fidler

BRUSSELS—Europe, facing a momentous Greek election after a week of mounting financial stresses, is preparing for what some financial analysts are calling its “Lehman moment”: the prospect that Greece could leave the euro currency union following Sunday’s vote. Yet, European officials say that even an election that results in a Greek embrace of the euro and an acceptance of the terms of Europe’s March bailout of the country may only temporarily ease pressure on the euro zone, whose crisis-management strategy many analysts say lies in shreds. Borrowing costs in Spain and Italy rose sharply higher in recent days despite efforts to insulate Spain, the euro zone’s fourth-largest economy, from the effects of Greek uncertainty by lining up a bailout request last weekend for as much as €100 billion to boost the capital of Spanish banks. Read the rest of this entry »

Written by Theophyle

June 16, 2012 at 9:34 am

G8 – An increasing focus on growth, not austerity

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From The Economist Intelligence Unit

The spectre of financial meltdown in the euro zone was a dominant theme at the summit of G8 leaders at Camp David in the US on May 18th-19th. The summit ended with a joint declaration covering a typically sweeping array of topics, from the risks facing the global economy to the crisis in Syria. But there was no mistaking the fact that the emerging growth-vs-austerity debate—fuelled by political developments in France and Greece, and by fears surrounding financial stresses in Europe—was the issue of the moment. The consensus of international opinion is shifting towards the need for growth-focused policies, but it is also clear that fiscal consolidation will remain paramount. Read the rest of this entry »

Wealth Year 2015

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Asia’s rise is the economic event of our age. Should it proceed as it has over the last few decades, it will bring the two centuries of global domination by Europe and,   subsequently, its giant North American offshoot to an end.” Martin Wolf, 2003

The projected wealth of China in 2015 could mean it producing 27% of all the wealth in the world, if the economic trends established between 1975 and 2002 continue for another 13 years. In year 1 of the current era China produced 26% of the wealth in the world, but very slowly declined to generating only 5% of the world total in 1960. Read the rest of this entry »

Written by Theophyle

November 17, 2011 at 10:32 am