The Economist (August 9)
Abenomics may be working at the top, but it’s not trickling down to “folk who do not own bundles of shares or a flat in Tokyo’s trendy Daikanyama neighbourhood…. The mantra of Mr Abe and his advisers has been that a virtuous circle would come about whereby wages would rise and lift consumer spending, which in turn would boost investment by companies. Bingo: Japan would emerge from deflation. That is not happening and it is a conundrum.”
Tags: Abe, Abenomics, Advisers, Consumer spending, Daikanyama, Deflation, Investment, Japan, Shares, Tokyo, Trickle down, Wages
Euromoney (April Issue)
“Blackouts have become so widespread on the island of Mindanao that social-media users have taken to calling the energy secretary the secretary of darkness.” This highlights the need for infrastructure, not just in the Philippines, but throughout much of ASEAN where the Asian Development Bank (ADB) estimates “infrastructure projects will require sustained annual investment of approximately $60 billion a year to 2020.” Banking giant HSBC believes “demand in Asia as a whole might reach $11.5 trillion by 2030.”
Tags: ADB, Asean, Asia, Blackouts, Energy, Infrastructure, Investment, Mindanao, Philippines, Social media, Widespread
The Economist (March 22)
“Global spending on basic infrastructure—transport, power, water and communications—currently amounts to $2.7 trillion a year when it ought to be $3.7 trillion. The gap is almost as big as South Korea’s GDP. And it is likely to grow fast.” To close the gap, governments need to step forward, and new ways need to be found to coax private capital investment in infrastructure.
Tags: Communications, Gap, GDP, Government, Infrastructure, Investment, Power, Private capital, South Korea, Spending, Transport, Water
The Economist (March 8)
“Western firms have piled into emerging markets in the past 20 years. Now comes the reckoning.” The Fed’s quantitative easing, an over-exuberant investment cycle, rising local currency prices for commodities, and other factors are undermining the emerging market paradigm. “Plenty of firms and some whole industries need a rethink. The emerging-market rush may end up like a giant version of the first internet boom 15 years ago. The broad thrust was right but some big mistakes were made.”
Tags: Commodities, Currency prices, Emerging markets, Fed, Firms, Industries, Internet boom, Investment, Over-exuberant, Quantitative easing, Rethink
Chicago Tribune (February 27, 2014)
“Even if climate change turns out to be overblown, there’s no real downside in a carbon tax. We merely would have traded a tax that reduces good things, such as work and investment, for a tax that reduces bad things, such as environmental harms and hazards. If done in a revenue-neutral way, it would more likely speed economic growth than slow it.”
Tags: Carbon tax, Climate change, Downside, Economic growth, Environment, Investment, Overblown, Revenue-neutral, Speed, Work
Wall Street Journal (January 26, 2014)
As the Federal Reserve begins tapering, we’ll see which emerging markets have “been swimming naked.” During the days of easy money, nearly anybody could enjoy the party. Now we’ll see which countries squandered the opportunity and left themselves exposed. “The end of Ben Bernanke’s Fed tide will have its uses if it spurs the kind of tax, trade and investment reforms that have been put off in too many places. The question is how much damage will be done as this global adjustment takes place.”
Tags: Ben Bernanke, Damage, Easy money, Emerging markets, Exposed, Federal Reserve, Global adjustment, Investment, Opportunity, Reforms, Squandered, Tapering, Tax, Trade, U.S.
Euromoney (January Issue)
“US claims that Germany’s external surpluses are hindering global recovery are inaccurate and unjustified…. The complex reality is that Germany’s relative export success is not built on beggar-thy-neighbour policies or on the imposition of unnecessary austerity on its neighbours. It is founded domestically on higher productivity, better investment and substantial labour market reforms.”
Tags: Austerity, Beggar-thy-neighbour, Exports, Germany, Investment, Labour, Market reforms, Productivity, Recovery, Surpluses, US
Time (December 30, 2013)
“Despite the hoopla over the approval of the Volcker rule, which restricts banks from making certain types of speculative investments, our financial system isn’t much safer than it was before 2008…. Banks used to be the servants of American business. Now they are its masters.”
Tags: Banks, Business, Financial system, Investment, Safety, Speculation, U.S., Volcker rule
Wall Street Journal (October 30)
Al Gore warns a carbon asset bubble “is still growing because most market participants are mistakenly treating carbon risk as an uncertainty, and are thus failing to incorporate it in investment analyses. By overlooking a known material-risk factor, investors are exposing their portfolios to an externality that should be integrated into the capital allocation process.” If we are to avoid catastrophic levels of global warming, many fossil fuel reserves will ultimately end up as stranded carbon assets. “The transition to a low carbon future will revolutionize the global economy and present significant opportunities for superior investment returns. However, investors must also acknowledge that carbon risk is real and growing. Inaction is no longer prudent.”
Tags: Al Gore, Capital, Carbon assets, Carbon risk, Fossil fuel, Global economy, Global warming, Investment, Investors, Material-risk factor, Opportunities, Returns
Institutional Investor (August Issue)
Over the past decade, Brazil produced stellar returns. Internal strife and the looming tapering by the Federal Reserve are now, however, disrupting the long favorable investment environment. “Brazilian investors have not faced such uncertainty for many years. The country attracted investment because it appeared to be one of the most dynamic and politically stable emerging markets. The return of volatility will tax the ingenuity of Brazil’s money managers.”
Tags: Brazil, Dynamic, Emerging markets, Fed, Investment, Money manager, Returns, Stable, Tapering, Uncertainty, Volatility
