Europe’s banks are
shrinking. What will take their place? Peer-to-peer platforms for
miscellaneous retail services and institutional investors as lending sources
for issuers with lower credit ratings. Retail-bond markets are becoming an
increasingly popular and HY bond is heading a record year. While the pool of II’s
is still small, alliances with division of labor in issuance and risk-taking
are sprouting up. The path ahead for European finance is broadly clear. The
banks will concentrate more on bread-and-butter lending like mortgages and cut
down their exposure to other long-dated assets; a few lucky corporate issuers
will be able to pick and choose how they get their capital; everything else
will have to rely more on other sources of finance. More firms will turn to the
bond markets. Very large pools of capital—held by sovereign-wealth funds, as
well as by insurers and pension funds—will do more direct lending, often in
partnership with banks. New forms of finance will nibble away at mainstream
providers.[Note: Could we one day move to a banking model drive by transparency
and technology?]…Source: http://www.economist.com/news/briefing/21568365-europes-banks-are-shrinking-what-will-take-their-place-filling-bank-shaped-hole
5 Steps That Will
Curb Gun Violence: (1) microstamping with every gun carrying its own unique
signature on every bullet, (2) magazine limitations, (3) equalizing online and
offline gun sales, (4) put gun registries in Terrorism databases, and (5) Cash
for guns. [Note: Gun laws apply to people who actually follow laws]…Source: http://www.wired.com/dangerroom/2012/12/gun-control/all/
Today’s challenges go
beyond Keynes: Keynesian returned with the financial crisis, but it’s time
to reconsider, says Jeffrey Sachs, amidst US’s 4 years of structural budget
deficits, zero rates, and endless calls of stimulus: (1) he fiscal expansion
has been mostly in the form of temporary tax cuts and transfer payments. Much
of these were probably saved, not spent; (2) the zero interest rate policy runs
the risk of creating another bubble, and (3) our real challenge is not a great
depression, but deep structural change. The US needs a different growth path.
[Note: a recovery from productivity leap we need]…Source: http://www.ft.com/intl/cms/s/0/369d77da-483f-11e2-a1c0-00144feab49a.html#axzz2FEfRQdLC
High-Tech Factories
Built to Be Engines of Innovation: the evisceration of manufacturing work
force over the past 30 years might have dimmed the country’s capacity to
innovate. Sophisticated engineering and manufacturing capabilities that
underpin innovation in a wide range of products have been rapidly leaving
alongside low-value tasks, and that might have left the US behind in some
fast-growing areas of cutting-edge technology like bioscience and
nanotechnology. [Note: unfortunately, engineering and bioscience is just not as
cool as, say, computer science and finance, you know]…Source: http://www.nytimes.com/2012/12/14/business/companies-see-high-tech-factories-as-fonts-of-ideas.html?pagewanted=2&_r=0
Difference Engine:
Phones up in the air: The phone ban exists not (as the public is often led
to believe) because mobiles disrupt an aircraft’s sensitive avionics, but
rather to stop them playing havoc with the phone companies' receiving equipment
on the ground that is trying to handle their calls. [Note: there could be other
reasons too, such as the demand for passengers to be alert and the chances of
mobile devices becoming unguided missiles should a crash occur]…Source: http://www.economist.com/blogs/babbage/2012/12/radio-interference
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