Warning lights are flashing on the global economy – and it’s the reform laggards who will suffer November 17, 2014 DAVID Cameron has warned of an unstable global economy. He says red lights are flashing on the dashboard. They are, but only in some parts of the world. Elsewhere, recovery looks firmly entrenched. Hot on the heels of US Treasury secretary Jack Lew’s comments about a “lost decade” in Europe, the Prime Minister’s remarks show [...]
Is Mark Carney right that clawback may need to cover all bankers’ pay, not just bonuses? November 17, 2014 Alex Edmans, a finance professor at London Business School and Wharton, says Yes. Pay packages should ensure that executives act in the long-run interest of their firms. Short-run bonuses incentivise bankers to boost near-term earnings at the expense of long-run value – such as writing subprime loans or manipulating rates. Clawbacks will deter myopic actions, [...]
A crude conspiracy: Saudi Arabia’s oil war is about far more than economics November 16, 2014 Having worked in Washington for the better part of a decade, I absolutely despise conspiracy theories, as they simply do not explain the world as I’ve found it. Rather than an evil, omniscient series of Bond villains ruling things, my experience is that human error and fallibility explain far more. As Bob Woodward’s key source [...]
Alan Yarrow: My plans as lord mayor – creating wealth and championing volunteering November 16, 2014 As those of you who braved the elements last Saturday will know, there’s a new lord mayor in town. I am thrilled to have the opportunity to take over from Fiona Woolf in this 900 year old office. It is a big job, a big challenge, but one I am determined to meet. One of [...]
After growth beat expectations, are we too pessimistic about the Eurozone’s chances? November 16, 2014 Christian Schulz is senior economist at Berenberg, says Yes. Remember early October? We’d just learned that German industrial output, factory orders and exports had plummeted in August by the biggest margins since Lehman. Alarm bells rang from Frankfurt to Washington. The reality is less spectacular: Germany entered an economic rough patch. Russia’s aggression against Ukraine [...]
The Eurozone is not likely to survive its own Japanese-style lost decade November 13, 2014 BEFORE the fiscal and monetary stimulus of “Abenomics”, Japan was afflicted with a chronic economic sickness. Crippled by excess private sector savings, it fell into deflation in the 1990s, despite very low nominal interest rates. Today, it is often suggested that the Eurozone is experiencing a similar malaise. Prior to the autumn, the leaders of [...]
Slum finance: We can build a new asset class by housing the desperately poor November 13, 2014 THE LATEST forecasts for global population growth continue to surprise. The number of people on our planet is thought likely to reach 11bn, or even 12bn, by the end of the century. Africa’s population is set to quadruple to 4bn. There are huge reasons for optimism, not least because world hunger has continued to fall [...]
Talent shortages could be the greatest threat to our economic health November 13, 2014 THIS week brought some long-awaited good news for Britons’ pay packets, as ONS data showed that average wages have beaten inflation for the first time since 2009. The jobs market outlook is rosier than it has been for years, but we are now facing the great irony of recovery. Having waited so long for it, [...]
With the FA castigated by Fifa, is the World Cup bidding process fundamentally flawed? November 13, 2014 David Skelton is director of Renewal, an organisation dedicated to broadening the appeal of the Conservative Party, says Yes The World Cup is an incredible event, but it is presided over by an organisation that doesn’t work. Fifa is a bunch of plutocrats, as out of touch from the passionate fans of the game as [...]
Africa is thriving: Only foreign capital can plug its $11.4 trillion funding gap November 12, 2014 In the age of 24-hour news, local and international headlines are instantly accessible, and the “developing” label placed on many nations and regions is looking increasingly out of date. The massive global economic growth witnessed over the last century was largely the result of increased international money flows. Foreign investment is vital for countries looking [...]