Excellent background here in Stratfor report “The Geopolitics of Israel: Biblical and Modern.”
Which you should follow up with this article from Wharton on an energy-based national game changer.
Category Archives: Economy
Israel – Background and Game Changing New Developments
Filed under Developing Nations, Economy, Political Risk, Technology, Trade
“Fiscal Crises and Imperial Collapses: Historical Perspective on Current Predicaments”
Outstanding presentation by Niall Ferguson on the crisis and collapse of political and economic systems. Although the lecture occurred 2 years ago, it is even more relevant today. The Ad Orientem blog brought this to my attention, and helpfully says:
“This is an outstanding lecture on how countries get too heavily indebted and then suffer a ruinous financial collapse. If you want to understand what is going on now in Europe, and what is almost certainly going to happen here in the coming years, watch this lecture. I suggest starting at around the 8 minute mark to skip the introductions.”
I hope that you find it interesting, as it is a very important hypothesis.
Filed under Economy, Political Risk
Taken from: The Wall Street Journal Entrepreneurship Weekly Review
Small Firms See Pain in Health Law
by: Louise Radnofsky
Aug 01, 2012
Click here to view the full article on WSJ.com
TOPICS: Government Regulation, Healthcare, Small Business
SUMMARY: Small firms are nervous about the impact of the new health law. The law requires that employers with 50 of more full-time workers provide health insurance to employees by 2014 or pay a penalty. This provision may cause some firms that planned to expand, cut back on their plans to say under the 50 employee threshold. Restaurants and retailers, in particular, may feel the pinch. These industries historically have been the least likely to provide insurance to workers, and may now need to start providing health insurance. McDonald’s, for example, has estimated that the law will add between $10,000 and $30,000 in added annual costs to each of its 14,000 restaurants in the U.S., 89% of which are franchisee-owned. One owner of a Quiznos franchise, quoted in the article, said “I don’t have the profit margin to pay for it.” Some owners who offer limited health-benefit plans have actually said that they might drop their plans and pay penalties rather than provide the more expensive insurance. Democrats who crafted the health-overall law say that employee coverage is essential to making the law work. One benefit of the new law is that it will create insurance exchanges that will allow employers to shop for the most economical health care plans possible.
This article illustrates the impact that government regulations have on small business. Talk to your students about the new health care legislation, and the impact that it will have on small business. Think of a small business that may soon cross the threshold of 50 employees, and the options that the business has in regard to the health care law. Also, talk about the role of government in regulating small business in general.
Reviewed By: Bruce Barringer, Oklahoma State University
Problems with both the Start of Working Life and the End of Working Life in the USA
For starters: this is a pretty grim article regarding the young university graduates “Jobless generation puts brakes on US” (from that daily font of Keynesian wisdom – which was supposed in 2009-2012 to get the USA out of this mess by opening the spigots of deficit spending – the Financial Times).
Now the other end of the working life, and selecting the most populous US state, we have the wonderfully terrifying PensionTsunami.com website. Poke around it a bit, you really won’t be disappointed.
“The oncoming wave of pension debt is even bigger than it seems. The purpose of this website is to provide an overview of the multiple pension crises that are about to drown America’s taxpayers. Our primary focus is on California, but we also track other states, corporate pensions, social security and international trends.”
LIBOR is Not a Hungarian Actress
I’ve spent a lot of time talking with people about LIBOR over the years; even well-educated Americans are fairly clueless about what it is – and no, she is not a Hungarian actress.
Here is a nice infographic about what LIBOR is, with a very brief explanation at the bottom about the current scandal (and, at the top, a link to a rather poor Washington Post article about the same – the main item of interest is that now the British government is saying Tim Geithner is lying). LIBOR is used in a LOT of financial vehicles: mortgages, derivatives, alternative risk transfer arrangements, etc. Below is a selection of some articles that make efforts to explain the current scandal, and why they may be important:
1. From the UK’s Economist – “The rotten heart of finance” (which, towards the bottom, touches on something focused on in #5 below)
2. From the Wall St. Journal – “Rate Scandal Set to Spread” (now behind pay wall) – which contains the (probably inaccurate) factoid that more than $800 trillion in securities and loans may be linked to LIBOR, and “U.S. Regulators, Taken to Task on Libor, Vow Vigilance” – which shows the current political nature of this affair.
3. From Professor Mead (from the American Interest) – “The LIBOR Scandal: A Crisis of Faith” – which is really more about the lack of faith people have in the current global leadership. Which brings us to one of the dimmest bulbs in that particular pack…
4. An accusation of the US Treasury Secretary in the NY Post – “What did Tim know?” I know people who have worked with Tim Geithner. And, yes, he really does have poor math skills. But I am not sure if this particular scandal is the problem that will get him in trouble, which brings us to…
5. Asia Times‘ Spengler – “Dr Frankenstein’s LIBORatory” – refreshingly brings his knowledge of banking, history of the 2007-2009 financial crisis and how the monkeying around with LIBOR at the time, “this tissue of lies, collective referred to as ‘regulatory forbearance,’ allowed the banks to get their balance sheets under control within a year, repay emergency loans to the US Treasury with a profit, and get back to the business of lending.”
This is a big deal, but is still off most peoples’ radar. Read or review all the above and come to your own conclusions…
European Debt Crisis, Episode 253 – First Spain, Now Italy…
Concern for the moment shifts from Spain to Italy: “The Battle of Italy is truly under way; the Battle of Europe comes next.” But this may just be temporary, because some are already saying the Spanish deal, this latest euro fix, will come apart in less than a month.
Meanwhile, “EU Floats Worst-Case Plans for Greek Euro“.
Filed under Economy, Europe, Finance, Political Risk
The TaxProf Blogs “The Tax Cliff” That the USA Faces on January 1, 2013
A “Tax Cliff” can’t be something good…
“Declining European Demand for Asia’s Exports Compounds Sputtering Growth”
CBO’s Analysis of US Government Deficits
Although the CBO report is problematic, this article shows the difference between budget deficits and total U.S. debt… and how the USA could be maxed out in less than a decade.
Filed under Economy, Finance, Political Risk
Unusual Economic Indicators
Very different and quite interesting – go here for a summary of 6 unusual economic indicators including:
The Big Mac Index
Hem Lines
Cardboard Box
And others…
I use the Big Mac Index when teaching international business.
professorruml 