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Archive for the ‘Economics’ Category

The Economist: For richer, for poorer

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Growing inequality is one of the biggest social, economic and political challenges of our time. But it is not inevitable. In 1889, AT the height of America’s first Gilded Age, George Vanderbilt II, grandson of the original railway magnate, set out to build a country estate in the Blue Ridge mountains of North Carolina. He hired the most prominent architect of the time, toured the chateaux of the Loire for inspiration, laid a railway to bring in limestone from Indiana and employed more than 1,000 labourers. Six years later “Biltmore” was completed. With 250 rooms spread over 175,000 square feet (16,000 square metres), the mansion was 300 times bigger than the average dwelling of its day. It had central heating, an indoor swimming pool, a bowling alley, lifts and an intercom system at a time when most American homes had neither electricity nor indoor plumbing. Read the rest of this entry »

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Written by Theophyle

October 15, 2012 at 8:16 am

Three Reasons to Salute Ben Bernanke

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by John Cassidy

It’s time to give Ben Bernanke some credit. Under attack from the left and right for much of the past year, the mild-mannered former Princeton prof has shown some leadership and pushed through a major policy shift. In committing the Fed to buying tens of billions of dollars worth of mortgage bonds every month until the jobless rate, currently 8.1 per cent, falls markedly, Bernanke and his colleagues on the Fed’s policy-making committee have finally demonstrated that they won’t stand aside as tens of millions of Americans suffer the harsh consequences of a recession that was largely made on Wall Street.

I’ve had my ups and downs with Bernanke, whom I profiled at length back in 2008. At the start of the year, I thought critics were giving him a raw deal. With short-term interest rates close to zero (where they’ve been since December, 2008), and with job growth seemingly picking up, the calls for more Fed action seemed overstated. But over the past six months, as the recovery sputtered and Bernanke dithered, I too, ran out of patience with him. In a column in Fortune last month, I even suggested that Barack Obama should have replaced him when he had the chance, back in 2010. Read the rest of this entry »

Written by Theophyle

September 16, 2012 at 9:15 am

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: Prices of Raw Goods Plunge on Slowdown

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The sudden economic downdraft has caused one of the biggest and broadest declines in commodities prices since the financial crisis, surprising producers and creating a glut of raw materials around the world.

From crude oil to copper to cotton, prices were down an average of 9% since late February, based on the Dow Jones-UBS Commodity Index. Read the rest of this entry »

Written by Theophyle

July 2, 2012 at 8:39 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

WSJ-E: Who’s the Boss? There Isn’t One

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By Rachel Emma Silverman

Like many tech companies, Valve Corp., a videogame maker in Bellevue, Wash., boasts high-end espresso, free massages and laundry service at its offices. One thing it doesn’t have: bosses

Valve, whose website says the company has been “boss free” since its founding in 1996, also has no managers or assigned projects. Instead, its 300 employees recruit colleagues to work on projects they think are worthwhile. The company prizes mobility so much that workers’ desks are mounted on wheels, allowing them to scoot around to form work areas as they choose.

Welcome to the bossless company, where the hierarchy is flat, pay is often determined by peers, and the workday is directed by employees themselves. Read the rest of this entry »

Written by Theophyle

June 21, 2012 at 8:57 am