Archive for the ‘#economics’ Tag

What is the Fiscal Cliff? And How It Can Drive America into Recession | Kapitall   Leave a comment

“Now that President Obama has won a second term in office, the attention of Wall Street has immediately turned onto the looming fiscal cliff. To underline the importance of the issue, asset manager Blackrock along with several other state pension boards took out full page advertisements on the eve of the election in the Wall Street Journal, New York Times and Washington Post to warn of the impending disaster.

Furthermore, on October 18, CEOs of major banks including JP Morgan, Goldman Sachs and Bank of America, signed an open letter pressing Congress and the President to “reach a bipartisan deal to avoid” the looming fiscal cliff. As it stands, should current laws stay exactly the same going into 2013, commentators are almost certain that the fiscal cliff will bring about another recession in the United States.

 

Just what is this fiscal cliff, and why is it so important for investors?

Essentially, the fiscal cliff represents a series of fiscal stimulus that will expire on the stroke of midnight on Dec 31, 2012. The four main drivers of the fiscal cliff are 1) the expiry of the Bush tax cuts, 2) expiry of the payroll tax cut, 3) ending of the emergency unemployment compensation passed in 2008 and 4) automatic budget cuts due to the Budget Control Act.

The expiry of the package of tax cuts, spending stimulus, and emergency benefits will all occur in 2013 and it is expected to contract the economy immediately by more than US$500 billion (>3% of GDP), almost guaranteeing the end of the economic recovery and ushering in a new recession.

AN : so the question in bold is a question which leads one to think. And questions demand answers. And answers take thoughts turned into words. But for the ” Ah Ha ! Eureka moment ” to strike …the picture settles the matter. Those little projections on top there…those are people….and people…that is a loooong way down from the cliff……

http://goo.gl/8Qgjx

via What is the Fiscal Cliff? And How It Can Drive America into Recession | Kapitall.

Posted November 7, 2012 by arnoneumann in Economic, Visualization

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BBC News – Viewpoint: Manuel Castells on the rise of alternative economic cultures   Leave a comment

“Newsnight economics editor Paul Mason interviewed Prof Castells in front of an audience at The London School of Economics for BBC Radio 4’s Analysis about his latest book Aftermath: The Cultures of the Economic Crisis.

Prof Castells suggests we may be about to see the emergence of a new kind of capitalism, with businesses growing out of the counter-cultures of the last 20 years. Here are some extracts from their conversation. :

Paul Mason: How big is this culture change?

“It is fundamental because it triggers a crisis of trust in the two big powers of our world: the political system and the financial system.

People don’t trust where they put their money and they don’t trust those who they delegate in terms of their vote.

It’s a dramatic crisis of trust and if there is no trust, there is no society.

“What we are not going to see is the economic collapse per se because societies cannot work in a social vacuum. If the economic institutions don’t work, if the financial institutions don’t work, the power relations that exist in society change the financial system in ways favoured to the financial system and it doesn’t collapse. People collapse, not the financial system.

“The notion is the banks are going to be alright, we are not going to be alright. So there is a cultural change. A big one. Total distrust in the institutions of finance and politics.

“Some people start already living differently as they can – some because they want alternative ways of life, others because they don’t have any other choice.

“What I refer to is about the observation of one of my latest studies on people who have decided not to wait for the revolution – to start living differently – meaning the expansion of what I call in a technical term ‘non-capitalist practices’.

“They are economic practices but they don’t have a for-profit motivation – such as barter networks; such as social currencies; co-operatives; self-management; agricultural networks; helping each other simply in terms of wanting to be together; networks of providing services for free to others in the expectation that someone will also provide to you. All this exists and it’s expanding throughout the world.”

Continue reading the main story

AN : Profound treatise ! Do read the whole article and delve further into what is actively happening in this transformational, disruptive thinking area of real economics.

http://goo.gl/6Prdv

via BBC News – Viewpoint: Manuel Castells on the rise of alternative economic cultures.

Disney Buys ‘Star Wars’ Producer Lucasfilm for $4 Billion – Bloomberg   Leave a comment

Walt Disney Co. (DIS) agreed to buy George Lucas’s Lucasfilm Ltd. for $4.05 billion in cash and stock, adding “Star Wars” and “Indiana Jones” to a roster of film hits including “The Avengers” and “Finding Nemo.”

Lucas, 68, the sole owner, will receive half in cash and the balance in stock, becoming a major investor in the film, theme-park and TV company, according to a statement today from Burbank, California-based Disney. The first of a new trilogy of “Star Wars” films will be released in 2015, Disney said.

The deal brings Disney, which paid a combined $11 billion for Pixar and Marvel in the past decade, two of Hollywood’s most lucrative franchises. The “Star Wars” films have generated $4.54 billion in worldwide ticket sales, second to Warner Bros.’ “Harry Potter,” according to Box Office Mojo. “Indiana Jones” pictures have collected $1.95 billion.

“Dating all the way back to Walt Disney’s day, we learned the value of great content, characters, storytelling and great imaginary worlds,” Chief Executive Officer Robert Iger said in an interview.

The acquisition complements Iger’s focus on sequels and film franchises, fitting the same profile as the Marvel purchase three years ago.

“If Disney is really trying to focus on the tent-pole, event pictures, and given that this is something that has huge carryover value in the parks and merchandise business, it certainly makes sense,” said Matthew Harrigan, an analyst at Wunderlich Securities in Denver. “This is just the paradigm of the sustainable Hollywood franchise.”

AN : This report underscores the need to have those who are economic-centric understand the value of creativity and the creative arts. Yes ultimately it is about pure ejoyment of the expression of our God given talents , but it is also that such creative expression can be measured and monetized.

Too much emphasis is laid on economics as a driver. George Lucas, Steve Jobs  et al opened whole new worlds, so to speak ,with their ways of thinking and what they thought up.

In another blog , ( http://www.nakedcapitalism.com/2012/10/randy-wray-the-worlds-worst-central-banker.html ) the author reviewed commentary about the Central Banker for Argentina :

“The head of the Argentine Central Bank—Mercedes Marco del Pont–has been awarded the distinction as “the world’s worst central banker”. By whom, you might ask? Well, by Wall Street’s sycophantic press. Wall Street hates Mercedes. The woman, not the car.

Why? Well, for one thing she’s a woman. Wall Street hates female heads of central banks (take a look at the list of the top ten worst—3 out of 10 are female; then take a look at the 10 best, of which all but one are males.)

But that’s not anywhere near the most important reason. Ms. Marco del Pont kicked off the conference with a rousing talk, defending her central bank’s recent move away from a single mandate (inflation target) to pursuit of multiple mandates: financial stability, employment creation, and economic development with social equity.  

When Central Bankers begin to get the message and get out the message that economics is not enough…we are onto something.

Creativity has tremendous value….Lucas would surely attest to that.

http://goo.gl/BI8lf

via Disney Buys ‘Star Wars’ Producer Lucasfilm for $4 Billion – Bloomberg.

Posted October 30, 2012 by arnoneumann in creativity, Economic, Thinking

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Pesek: Krugman Take on $12 Trillion Question Rings True – Bloomberg   Leave a comment

A fiery debate has broken out over an issue many thought had long been settled: Japan (JGDPAGDP)’s economy is sliding toward irrelevance.

The freshest evidence, reported earlier this week, is the first annual trade deficit in 31 years. It means, at the very least, that the huge pool of domestic savings that Japan uses to finance its staggering national debt might instead start going to support a trade deficit, an ominous sign.

Not necessarily a problem, says Eamonn Fingleton, a long- time observer who recently wrote an op-ed in the New York Times headlined “The Myth of Japan’s Failure.” His argument that Japan is a model worth emulating generated a huge buzz. So much, in fact, that it prompted a rebuttal from Nobel laureate and Times columnist Paul Krugman, who’s considerably less enamored with Asia’s No. 2 economy. Fingleton then rebutted the rebuttal.

Who’s right? I’m more in Krugman’s camp than Fingleton’s. Japan’s toxic mix of too much debt, too little growth, too many old people and too few babies will end badly if Tokyo doesn’t get its act together.

It’s important, though, to highlight where Fingleton is right. Japan is pretty close to a model society. It is an incredibly safe, clean, efficient, predictable and consistently quirky place for an expatriate to reside. Japan is reasonably egalitarian, its people have one of the highest standards of living and enjoy the longest life spans, and its cities feature the best infrastructure anywhere. On a more superficial level, Japanese cuisine arguably blows away all others.

Japanization Myth

It’s worth noting that, in some ways, the U.S. only wishes it could become Japan someday. All the chatter about “Japanization” takes on apocalyptic tones: lost decades, debilitating debt levels, zero interest rates forever, financial chaos and existential despair. Although those worries are valid, Japan never unraveled the way skeptics expected.

Crime didn’t skyrocket, homelessness didn’t explode, Arab Spring-like social instability never materialized. Workers and companies merely adjusted, living off their savings. Japan brought a whole new meaning to the concept of muddling through.

Could the U.S. pull off what Japan has? I doubt it. The key to Japan’s ability to withstand 20 years of stagnation is roughly $15 trillion of household savings. Many Americans couldn’t live two months without a paycheck. Japan, by contrast, is anything but a basket case.

Yet here is where Fingleton’s argument falls apart. In 1995, he published “Blindside: Why Japan Is Still on Track to Overtake the U.S. by the Year 2000.” Today, the real blindside among Japan bulls is thinking that what worked for Japan yesterday will work tomorrow.

Since its asset bubble burst more than 20 years ago, policy makers have worked frantically to keep the postwar boom alive. For years, pundits fretted about Japan’s zombie companies. The real zombie is Japan’s economic playbook.

The only reason Japan has any growth can be traced to its growing public debt, the world’s largest relative to the size of the economy, and the free money provided by the central bank. The economic equivalent of steroids is what holds Japan Inc. together, Krugman argues, not its organic vitality. To flourish, Japan needs to ease regulations, tap its female workforce and liberalize immigration. Lawmakers are doing none of the above.

There’s still a powerful aversion to change, and herein lies the nation’s Achilles’ heel. The Olympus Corp. (7733) scandal showed how corporate cronyism safeguarded an insular old-boys club. The radiation leaking from Tokyo Electric Power Co. reactors in Fukushima was a reminder of how dangerously top-down Japan is in a bottom-up economic world.

via Pesek: Krugman Take on $12 Trillion Question Rings True – Bloomberg.

Posted January 27, 2012 by arnoneumann in Economic, Japan

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Latin America may split into Pacific and Atlantic blocs | Truth About Trade and Technology – Truth About Trade and Technology   Leave a comment

“President Barack Obama’s recent announcement that he will seek to create what may be the world’s largest trading bloc along the Pacific rim raises an interesting question in this part of the world: whether we will see a de facto split of Latin America into a Pacific bloc and an Atlantic bloc.

It may be already happening. Obama’s recent proclamation that “the United States is a Pacific country” and his announcement that Washington will seek to dramatically expand the nine-member Trans-Pacific Partnership (TPP) has shaken world trade negotiations.

International economists agree that it is the biggest thing happening in world trade talks right now.

Under the plan, the TPP — it currently includes, among others, the United States, Australia, New Zealand, Singapore, Vietnam, Chile and Peru — would be expanded to include Japan, the world’s third largest economy, as well as Mexico and Canada, and perhaps even South Korea. Japan, Mexico and Canada have announced they are interested in joining the group.

The new Asia-Pacific trading bloc would be the most ambitious of its kind, since it would eliminate customs duties and set common standards for investments, labor and environmental regulations.

Although they will not say it publicly, in addition to enhancing trade, the United States wants to counter-balance China’s growing economic weight in Asia, and Mexico wants to offset Brazil’s clout in Latin America.

In Latin America, four Pacific rim countries — Mexico, Colombia, Peru, and Chile — have already agreed to start their own sub-regional group aimed at taking advantage of the new Asia-Pacific trade opportunities.

At a Dec. 5 summit in Merida, Mexico, the four countries — plus Panama, which participated as an observer — agreed to officially launch their trade bloc, known as the Alliance of the Pacific, on June 4, 2012, in Chile.

Members of the Alliance pledged to combine their stock exchanges, and set a gradual timetable for the total elimination of tariffs of goods and services by 2020 or 2025.

Mexico’s economy secretary Bruno Ferrari told me in a telephone interview that “we are entering an era of trade blocs” that will replace the era of bilateral free trade agreements. Countries either team up with others to create supply chains that produce goods more competitively, or risk being left behind, he said.

“When Mexico signed its first free trade agreement a few decades ago, there were 40 free trade agreements in the world. Today, there are 290,” Ferrari told me. “This means that we are seeing an erosion of the free trade agreements’ importance, since you are competing with more countries that enjoy your same customs preferences.”

Ferrari added, “With no doubt, TTP is the most important trade agreement in the works today in the world. It is therefore paramount that Mexico be part of it.”

In a separate interview, Colombian Trade Minister Sergio Diaz-Granados told me that one of the central goals of the Alliance, in addition to facilitating intra-regional trade, will be “to increase Latin America’s participation in the Asia-Pacific rim, which will be the most dynamic economic zone in the next 20 years.”

My opinion: Ideally, Latin American countries should seek to create a single trading bloc from Mexico to Argentina. According to a recent Inter-American Development Bank study, intra-regional trade in Latin America is a pitiful 20 percent of the region’s total trade, compared with 46 percent in Asia and 67 percent in Europe.

But there are no signs of that happening. The Dec. 3 summit in Caracas, Venezuela, that created the Community of Latin American and Caribbean Nations (CELAC) was filled with poetic speeches about regional unity, but did not include any concrete measures to speed up economic integration. In fact, economy ministers didn’t even participate.

In 2012, we are likely to see a further consolidation of the Chile-Peru-Colombia-Mexico bloc, with the possible future addition of Central American countries, all of which have free trade deals with the United States and want to insert themselves further into the emerging TPP.

On the other hand, Brazil, Argentina, Uruguay and Venezuela, which in recent years have benefitted from record commodity export prices, are likely to continue exporting their raw materials to China and India, and in Venezuela’s case to the United States, without feeling much urgency to join larger trading blocs.

I hope I’m wrong about this, but despite all the talk about Latin America’s integration in recent weeks, we may soon see a Latin America of the Pacific, and a Latin America of the Atlantic.”

via Latin America may split into Pacific and Atlantic blocs | Truth About Trade and Technology – Truth About Trade and Technology.

Posted December 19, 2011 by arnoneumann in Economic, Trade

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Cooper-Hewitt show presents slums as innovation hotbeds | SmartPlanet   Leave a comment

 

 

“The predecessor to “Design with the Other 90%: Cities” opened at the Cooper-Hewitt in 2007. Titled “Design for the Other 90%,” the 2007 show was smaller, featuring 34 projects from around the world, ranging from One Laptop Per Child, an often-debated initiative to create inexpensive computers for kids in resource-challenged regions, to LifeStraw, a straw designed to filter and purify water immediately as a user sips through it.The initial show’s thesis, as well as that of the on-going series, is that designers have traditionally focused on creating products and services to sell to the wealthiest 10% of the world’s population, but architects, engineers, graphic and industrial designers, as well as design-savvy entrepreneurs, are increasingly addressing the needs of the majority of the globe’s residents–namely those who live in poverty.“The first show hit a nerve. It started to spark an international conversation on what role design could play in solving critical global issues,” Smith said, pointing out that the first show traveled to six different venues and the catalog has been reprinted seven times, including Japanese and Korean editions.“We saw there was dearth of information on this type of design,” Smith added. “So we decided to create a series.”While it’s still early to talk about what the Cooper-Hewitt has planned for its next show–Smith said there will be others–the series has a permanent home online as individual exhibitions open and close, with the Design Other 90 Network. The site offers a database that will kick off with 100 projects from both of the shows in the series to date. There’s room for more as worldwide conversations–and debates–on how to best design for, and with, the 90 percent of the world’s citizens are sure to continue.”

via Cooper-Hewitt show presents slums as innovation hotbeds | SmartPlanet.

Posted October 16, 2011 by arnoneumann in architecture, design

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