Puerto Rico - Recovery Challenges

Impact of Short-Termism

Short-Termism Poses Long-Term Drag on Growth

https://www.bloomberg.com/view/articles/2017-09-29/short-termism-poses-long-term-drag-on-growth

Noah Smith notes:

“Short-termism might be slowing growth by holding back corporate investment. When businesses invest, the economy grows. But big investments reduce near-term earnings, and incur considerable uncertainty as to whether they’ll pay off. If executives of public companies are compensated based on quarterly earnings, there’s just very little incentive to make big expensive risky forward-looking investments -- and that means little incentive to grow.”

Financial Markets and Risk

Why Financial Markets Underestimate Risk
https://www.project-syndicate.org/commentary/financial-markets-crisis-risk-by-jeffrey-frankel-2017-09

IBM in India

IBM in India - “IBM Now Has More Employees in India Than in the U.S.”

https://www.nytimes.com/2017/09/28/technology/ibm-india.html

The Inflation Debate

Inflation and bond markets

https://www.bloomberg.com/view/articles/2017-09-28/inflation-is-no-mystery-to-the-bond-market

Janet Yellen on inflation uncertainty

https://www.federalreserve.gov/newsevents/speech/files/yellen20170926a.pdf

India’s Push to Expand its Manufacturing Sector

The ‘Make in India’ Campaign

http://www.makeinindia.com/home

Boosting Indian manufacturing:

http://www.ey.com/Publication/vwLUAssets/ey-sustaining-india-growth-by-accelerating-manufacturing/$FILE/ey-sustaining-india-growth-by-accelerating-manufacturing.pdf

Policy challenges:

http://www.igidr.ac.in/newspdf/nagraj_webpage/Eco2017.pdf

Creative Destruction

The Fall, Rise and Fall of Creative Destruction

https://www.bloomberg.com/view/articles/2017-09-26/the-fall-rise-and-fall-of-creative-destruction

QE – Pros and Cons

Was Quantitative Easing Effective?

https://www.bloomberg.com/view/articles/2017-09-25/sizing-up-qe-now-that-it-s-ended

Will QE become a part of the toolkit of major central banks
https://www.bloomberg.com/news/articles/2017-09-19/yellen-sees-qe-as-a-tool-of-the-future-but-her-successor-may-not

Emerging Markets - Structural Changes and Economic Development

Structural Reforms versus Fiscal Stimulus – India Case Study

In the long-run, benefits from structural reforms will be significant for the Indian economy

http://www.livemint.com/Opinion/nrKMCIBhZ92EDz4whEvtgP/India-churning-vs-India-shining.html

http://www.livemint.com/Opinion/F5rnvBY2zczlCv3ytTmZBK/Narendra-Modi-needs-to-press-the-gas-pedal-on-reforms.html

http://www.livemint.com/Opinion/HMUPXtW4vAN6BwbJMDf7lJ/Going-beyond-the-idea-of-fiscal-stimulus.html

China – Recent Developments

Debt and Household Consumption in China

https://www.nytimes.com/2017/09/25/business/china-debt-consumers.html

The Economist on the rise of Chinese entrepreneurs:

https://www.economist.com/news/briefing/21729429-industries-and-consumers-around-world-will-soon-feel-their-impact-chinas-audacious-and

China’s ambitious high-speed rail program

http://www.straitstimes.com/asia/chinas-rail-ambitions-run-at-full-speed

Complacency and Economic Malaise

George Will’s thought-provoking piece is worth reading:

https://www.washingtonpost.com/opinions/the-thing-america-strives-for-most-complacency/2017/09/22/a6f1d382-9ef2-11e7-9083-fbfddf6804c2_story.html

“The Great Enrichment is McCloskey’s term for what, in a sense, started with steam and has been, she believes, the most important human development since the invention of agriculture 10,000 years ago. The development is the explosion of economic growth that began around 1800 and has, especially since reaching China and India, lifted billions of people from poverty. Today, however, the Great Enrichment might be running out of steam in the United States, which for two centuries has given propulsive energy to it.

In 1800, McCloskey says, the world’s economy was where Bangladesh’s economy now is, with no expectation of change. Today, most of the jobs that existed just a century ago are gone. And we are delighted that this protracted disruption occurred. Now, however, the Great Enrichment is being superseded by the Great Flinch, a recoil against the frictions and uncertainties — the permanent revolution — of economic dynamism. If this continues, the consequences, from increased distributional conflicts to decreased social mobility, are going to be unpleasant.”

Related:
Young Men Are Playing Video Games Instead of Getting Jobs. That's OK. (For Now.)
http://reason.com/archives/2017/06/13/young-men-are-playing-video-ga

Rise of the Rentier Class

https://www.project-syndicate.org/commentary/rise-of-global-rentier-capitalism-by-stephanie-blankenburg-2-and-richard-kozul-wright-2017-09

Why German Elections Matter

Given Germany’s current status as the de facto leader of the liberal Western order, its national election results matter a great deal:

http://www.spiegel.de/international/germany/german-election-merkel-wins-and-afd-wins-seats-in-parliament-a-1169587.html

http://www.dw.com/en/how-germany-chooses-its-chancellor/a-40663837

http://www.dw.com/en/opinion-the-world-needs-more-europe-and-less-donald-trump/a-40646880

Trump embraces a post-American world

https://www.washingtonpost.com/opinions/trump-embraces-a-post-american-world/2017/09/21/91342088-9f09-11e7-9083-fbfddf6804c2_story.html

China’s Overseas Investments – Economic Challenges and Strategic Motives

An excellent piece – What the World’s Emptiest International Airport Says About China’s Influence

https://www.nytimes.com/2017/09/13/magazine/what-the-worlds-emptiest-international-airport-says-about-chinas-influence.html

BROOK LARMER notes:

“It’s tempting to see OBOR [One Belt, One Road Project] as a muscled-up Marshall Plan, the American-led program that helped rebuild Western Europe after World War II. OBOR, too, is designed to build vital infrastructure, spread prosperity and drive global development. Yet little of what China offers is aid or even low-interest lending. Much OBOR financing comes in the form of market-rate loans that weaker countries are eager to receive — but may struggle to repay. Even when the projects are well suited for the local economy, the result can look a bit like a shell game: Things are built, money goes to Chinese companies and the country is saddled with more debt. What happens when, as is often the case, infrastructure projects are driven more by geopolitical ambition or the need to give China’s state-owned companies something to do? Well, Sri Lanka has an empty airport for sale.”

Earthquake Science

Mexico – Powerful Earthquakes

https://www.nytimes.com/2017/09/20/world/americas/mexico-earthquakes-explainer.html

The Strange Tectonic Coincidence of Mexico’s September Earthquakes by Marcia Bjornerud

https://www.newyorker.com/tech/elements/the-strange-tectonic-coincidence-of-mexicos-september-earthquakes

Interesting quote:

“The human mind delights in finding pattern—so much so that we often mistake coincidence for profound meaning. No other habit of thought lies so deeply within the soul of a small creature trying to make sense of a complex world not constructed for it.” - Stephen Jay Gould

International Affairs - Interesting Items

China’s Travel Growth to Outpace U.S. Over Next Decade

https://www.bloomberg.com/news/articles/2017-09-22/china-s-travel-growth-to-outpace-u-s-over-next-decade

US-France Relations

https://www.nytimes.com/2017/09/21/opinion/columnists/macron-trump-paris-climate-iran.html

https://www.nytimes.com/2017/09/22/opinion/emmanuel-macron-donald-trump.html

Global Disorder

https://www.project-syndicate.org/commentary/world-bank-imf-meetings-global-economic-order-by-mohamed-a--el-erian-2017-09

Post-Hurricane Tourism in Caribbean

https://www.nytimes.com/2017/09/22/travel/maria-irma-caribbean-tourism-island-by-island.html

Melinda Gates on Foreign Aid

Are We Nearing the End of the Equity Bull Market?

Yale economist Robert Shiller sounds a warning:
https://www.project-syndicate.org/commentary/us-stock-volatility-bear-market-by-robert-j--shiller-2017-09

Rise of Monopoly Power

The New Monopolists

https://www.project-syndicate.org/commentary/monopoly-power-wealth-income-inequality-by-mordecai-kurz-1-2017-09

Related:

http://vivekjayakumar.blogspot.com/2017/09/rise-in-monopoliesoligopolies-economic.html

German Approach to Dealing with Labor Market Challenges

Germany’s Labor Market

https://www.nytimes.com/2017/09/21/business/german-election-jobs.html

German approach to dealing with economic downturns:

Decline in the Labor Share of Income

Labor and Capital in the Global Economy

http://democracyjournal.org/magazine/43/labor-and-capital-in-the-global-economy/

Competing Theories

https://www.bloomberg.com/view/articles/2017-04-24/cracking-the-mystery-of-labor-s-falling-share-of-gdp

Rise of Monopolies

https://www.bloomberg.com/view/articles/2017-01-26/blame-monopolies-for-short-changing-u-s-workers

Role of Technology and Globalization
https://www.bloomberg.com/view/articles/2017-09-20/why-workers-are-losing-to-capitalists

Equifax and Crony Capitalism

Washington Post reports:

https://www.washingtonpost.com/business/economy/before-the-breach-equifax-sought-to-limit-exposure-to-lawsuits/2017/09/19/8e6c8020-9d47-11e7-9083-fbfddf6804c2_story.html

“Before Equifax discovered a massive computer breach that exposed sensitive information about millions of Americans, the company lobbied Congress on legislation to limit how much it could be forced to pay if sued by consumers, and it pressed lawmakers to roll back the powers of its regulators.”

Future Direction of US Monetary Policy

Fed indicates further tightening of US monetary policy:

https://www.bloomberg.com/news/articles/2017-09-20/fed-asset-shrinking-to-start-next-month-rate-hike-seen-in-17

Dot Plots:

https://www.bloomberg.com/graphics/fomc-dot-plot/

Resources and Africa’s Economic Development

Diamonds – A Resource Curse?

http://www.dw.com/en/africa-is-rich-in-diamonds-but-still-poor/a-40551741

Congo and Angola: a tale of two kleptocracies

https://www.economist.com/news/middle-east-and-africa/21727923-why-angola-meddles-so-much-its-giant-northern-neighbour-congo-and-angola

Positive News on Africa

Rwanda’s tech driven growth model:

https://www.cnet.com/features/rwanda-drones-solar-health-care/

Ethiopia pursues investment-led growth

Relative Income and Status

How Much Income Puts You in the 1 Percent if You're 30, 40, or 50?

https://www.theatlantic.com/business/archive/2014/10/the-top-1-percentand-01-percentof-every-age-group-in-america/382094/

Weekend Reading

Images from Cassini - Extraordinary images captured by the spacecraft Cassini:

https://www.nytimes.com/interactive/2017/09/14/science/cassini-saturn-images.html

Exposure to Fast Food and Obesity Epidemic in Emerging Markets

https://www.nytimes.com/interactive/2017/09/16/health/brazil-obesity-nestle.html

Superstitions and Hurricane Protection - The Luck of Tampa Bay
https://www.washingtonpost.com/national/health-science/tampa-bays-escape-from-irma-was-more-than-luck-some-say/2017/09/15/5f7b618e-9a20-11e7-87fc-c3f7ee4035c9_story.html

Why Happy People Cheat

https://www.theatlantic.com/magazine/archive/2017/10/why-happy-people-cheat/537882/

America’s Evolving Constitution

https://www.nytimes.com/2017/09/16/opinion/sunday/constitution-economy.html

American Media and the 2016 Election

https://www.theatlantic.com/politics/archive/2017/09/its-worth-reading-hillary-clintons-book/539973/

James Fallows notes:

“But she [Hillary Clinton] goes on to say that next on the list would be prevailing judgments in the media, led unmistakably by The New York Times, that treated her “damned emails” as if they were a first-order emergency, justifying more coverage than anything she said on issues of international or domestic policy, and deserving of placement on a par with the financial, ethical, experiential, and other liabilities of Donald Trump.”

Canada's Population Trends

Fascinating read:
https://beta.theglobeandmail.com/news/national/doug-saunders-maximum-canada-population-problem/article36275893/

Zero – A Mathematical History

Earliest recorded ‘Zero’ found in ancient Indian manuscript:

http://www.ox.ac.uk/news/2017-09-14-earliest-recorded-use-zero-centuries-older-first-thought

RELATED:

History of Mathematics – In Need of a Reappraisal

http://vivekjayakumar.blogspot.com/2016/05/history-of-mathematics-in-need-of.html

Reforming the US Tax System

Taxes, Incentives and Fairness

https://www.bloomberg.com/news/features/2017-09-12/why-american-workers-pay-twice-as-much-in-taxes-as-wealthy-investors
The Bloomberg piece notes:

“Taxing workers more than investors is fair, conservatives also argue, because investors and workers are really the same people at different stages of their lives. When you’re young, you save and pay high tax rates on your wages. When you’re old, you get to enjoy the lightly taxed proceeds of that invested income.

The wrench in these arguments is the massive jump in inherited American wealth—driven by rising income inequality and loose tax laws. In practice, the person who successfully accumulates assets is often not the person who spends them. Affluent retirees are increasingly reluctant to even touch their nest eggs. A huge and disproportionate share of the nation’s largest fortunes is in the hands of people in their 80s and 90s. And the estate tax, already very easy for the wealthy to avoid, is targeted for elimination by the Trump administration.”

A Recovering World Economy

Sebastian Mallaby notes:

https://www.washingtonpost.com/opinions/whos-looking-great-again-its-not-america/2017/09/15/368e7f4e-9a17-11e7-87fc-c3f7ee4035c9_story.html

“… foreign leaders have done a surprisingly good job of making foreign countries great again. From Xi Jinping’s China to Emmanuel Macron’s France, politicians are delivering policies that businesses want. As a result, the world economy is growing faster than at any time since the post-crisis bump of 2010.”

Related:

https://www.project-syndicate.org/commentary/global-economy-view-from-alps-by-jim-o-neill-2017-09