Category: Economy

Economy

Japan looked to by G20 for support

Colin Henderson

Japan is sitting with a tidy current account surplus that the others in the G20 are eyeing jealously.  Japan has to put itself first however. Japan’s $1 trillion to the rescue? | CS Monitor TOKYO – Can Japan, the world’s second largest economy, save the global financial system? As world leaders prepare to meet in Washington Saturday to seek a way out of the financial crisis, some are casting covetous eyes in the direction of Japan’s $1 trillion worth of foreign reserves as a source of salvation for troubled nations and banks. Continue reading Japan looked to by G20 for support

Economy6 Comments

Google – can I count on you ?

Colin Henderson

I have always been skeptical about online advertising.  I avoid it like the plague, and while I recognise I may not be the average, I also know I may be the view of things to come.  Google Analyst: “Worst Economic Environment In Our Collective Lifetimes” | Techcrunch Google’s stock price closed yesterday at $291, the first time it has dropped below $300 since 2005. It’s 44% off of its 52-week high of $725. Most analysts think its cheap and getting cheaper – the average price target is still over $500. Former analyst Henry Blodget, however, thinks it could fall to … Continue reading Google – can I count on you ?

Economy, Innovation8 Comments

Policies aimed at undermining innovation hinder an industry’s ability to compete globally | the case against new regulation

Colin Henderson

Nobel laureates Myron Scholes and Joe Stiglitz have been debating the question of regulation for financial services on Economist.com.  Its fascinating, and not as clear as one would think. For example, Scholes writing against additional regulation, notes And, in particular, since successful innovations are hard to predict, the infrastructure necessary to support innovation needs to lag the innovations themselves, which increases the probability that controls will be insufficient at times to prevent breakdowns in governance mechanisms. His point being that additional regulation will only deal with what we have already recognised as a problem.  In the case of sub-prime mortgages, … Continue reading Policies aimed at undermining innovation hinder an industry’s ability to compete globally | the case against new regulation

Economy, subprime

World economy 2013 | what should we expect?

Colin Henderson

A remarkable forward looking piece from Andrew at the ft.  Some of the implications: Russia extends influence through economic investment Stock values are one half of today’s value Interest rates are close to zero Dividends are at zero Central Banks are in complete control of regulation and of banks Banks are almost completely owned by the government A man from Fife is in charge of the world [scary] October 2013: that was the week that will be | ft.com By Andrew Hill What a week! The utility-dominated FTSE 100 celebrated the fifth anniversary of the crash of 2008 with a … Continue reading World economy 2013 | what should we expect?

Economy

Economist covers are collectibles during this crisis!

Colin Henderson

The last four Economist covers are classic.  It might even be unprecedented to have a month of covers/ leaders on the same topic – perhaps since war time? In any event, here they are for posterity. 20th Sept 2008 27th Sept 2008   4th Oct 2008 11th Oct 2008 18th Oct 2008 ?     How can they outdo themselves?  Any suggestions before they go to print!   Technorati Tags: the economist,economist covers Continue reading Economist covers are collectibles during this crisis!

Economy, regulation

Yamato Life goes bankrupt due to bad management

Colin Henderson

In a dramatic similarity to HBOS, Bradford & Bingley, to name just two, the Japanese Life Insurer Yamato was caught out investing in securities and losing out in the crash.  The similarity lies in the classic example of a financial services company getting caught out of its bread and butter business, trying to build profits in other ways, and taking shortcuts. Japanese insurer Yamato Life collapses Government officials tried to portray the bankruptcy as a special case. Yamato Life’s failure “is the result mainly of the company’s unique business model, whereby it covered its high operational costs with returns from … Continue reading Yamato Life goes bankrupt due to bad management

Economy

"If you can keep your head when all about you are losing theirs"

Colin Henderson

“If you can keep your head when all about you Are losing theirs and blaming it on you; If you can trust yourself when all men doubt you, But make allowance for their doubting too; . . . If you can meet with Triumph and Disaster And treat those two impostors just the same . . . Yours is the Earth and everything that’s in it.”   —  (Joseph) Rudyard Kipling If ever there was a time for Central Banks and governments to listen to Kipling, now is the time.  You can’t stop a panic – let the market wake … Continue reading "If you can keep your head when all about you are losing theirs"

Economy

World on the edge | Economist

Colin Henderson

The Economist is often quite pithy in their commentary but thought this weeks leader out today, is worth storing for the record books.  The general theme is that in looking beyond the bailout expect worse to come, as we peer over the brink.  Note the reference to the US Senate not being used to being second guessed, but this time that has occurred conclusively World on the edge | Economist Continue reading World on the edge | Economist

Economy3 Comments

"I truly fear for our economy and our system the next several days"

Colin Henderson

This from a “30year veteran of the bond market. My career began at the Open Market Desk of the Federal Reserve Bank of New York and the significant majority of the subsequent years were spent  trading (Treasuries) or selling high grade fixed income product for some of the largest primary dealer firms” The situation is grim: Endgame?, by Tim Duy: News is flowing in faster than the ability to process the implications.  When I went to bed Saturday night, the only sure thing looked like the liquidation of Lehman Monday morning.  A scant 24 hours later, to that liquidation is … Continue reading "I truly fear for our economy and our system the next several days"