Corporate miscreance takes so many forms that readers may wonder why I am highlighting the allegations against Infosys, the second biggest IT outsourcing company in India. The answer is that this case provides a window into a much bigger problem, namely, the lack of anything resembling coherent US industrial policy.
Read more...…which is not good news for honest New Zealand investors trying to do a due diligence exercise; nor for the New Zealand Ministry of Economic Development’s reputation, if it has one…
Read more...I don’t know about you, but I’m suffering from debt ceiling/Eurozone mess fatigue and thought readers might enjoy a wee respite. This engaging presentation by Kevin Slavin provides some useful food for thought about how the use of algorithms are coming to literally reshape our world.
Read more...William Rees is one of the pioneers of ecological economics and is the originator and co-developer of ‘ecological footprint analysis’. This video contains some basic facts about current consumption levels in advanced economies that are attention-grabbing. I’d normally say “Enjoy” but this is not that sort of video.
Read more...By Jon Rynn, author of the book Manufacturing Green Prosperity: The power to rebuild the American middle class. He holds a Ph.D. in political science and is a Visiting Scholar at the CUNY Institute for Urban Systems. Cross posted from New Deal 2.0.
Between questionable science, health hazards, and exorbitant costs, there’s no fracking way that drilling for natural gas will solve our long-term energy issues.
Read more...By Alberto Alesina, Paola Giuliano, and Nathan Nunn. Cross posted from VoxEU
Gender inequality is an old story. This column presents new evidence to suggest it may be as old as the horse and plough. It says there is a robust negative relationship between historical plough-use and unequal gender roles today. Traditional plough-use is positively correlated with attitudes reflecting gender inequality and negatively correlated with female labour force participation, female firm ownership, and female participation in politics.
Read more...I’m about to reveal that I am a hopeless Old Fart, but I don’t understand why anyone other that a public figure uses Facebook. It has been demonstrated that anything on Facebook can and probably will be used against you. If you have a dispute or someone took an obsessive romantic interest in them, it would normally take some doing (like hiring a private detective) to try to find dirt. By making what would have been private information pubic, Facebook greatly lowers the cost of people with bad intentions toward you making your life miserable.
One development overseas that may be coming to the US is using Facebook to send legal notices, such as foreclosure notices. As Bloomberg informs us (hat tip reader Buzz Potamkin), this practice has been accepted by courts in Australia, Canada, and the UK.
This article triggered my “planted story” detector, since the piece kept stressing how there were no privacy issues involved (well, that’s close to tautological given how Facebook works) and had virtually no negative views expressed about this practice being adopted in the US.
Read more...There is a very peculiar article by Steven Davidoff up at the New York Times: “As Wall St. Firms Grow, Their Reputations Are Dying.” It asks a good question: why does reputation now matter for so little in the big end of the banking game? As we noted on the blog yesterday, a documentary team was struggling to find anyone who would go on camera and say positive things about Goldman, yet widespread public ire does not seem to have hurt its business an iota.
Some of Davidoff’s observation are useful, but his article goes wide of the mark on much of its analysis of why Wall Street has become an open cesspool of looting and chicanery (as opposed to keeping the true nature of the predatory aspects of the business under wraps as much as possible).
Read more...This is a bit of a departure from our regular programming, but we like science and technology here (real technology, not the rent-seeking you see in finance misbranded as “innovation”) and this is impressive. Hat tip Francois T. From TED:
Read more...We’ve repeatedly said that offshoring and outsourcing are often not the big cost-savers that the industry promoting them, Wall Street, and the stenographers among the business press would have you believe.
Direct factory labor is typically just north of 10% of the cost of most manufactured goods; for cars, we are told it’s 13%. Even if you can extract meaningful savings there, you have significant offsets: the upfront cost of re-orgainzing production (which in the outsourcing scenario include hiring costly outsourcing “consultants” and paying attorneys to paper up the deals), higher ongoing managerial costs, higher shipping and related inventory financing costs. Yes, there are cases like Apple where outsourcing has been a big success, but there are also others where the benefits have been underwhelming and have come at considerable costs to US workers, communities, and the economy (see a very good long form discussion by Leo Hindery).
Moreover, these cost savings come with higher risk.
Read more...In another manifestation of Obama’s continuing move to the right, his latest stunt has been to out-Republican the Republicans as a defender of the Pentagon. The GOP, which is out to cut $100 billion more from Obama’s version, has targeted the Department of Defense for $15 billion from an initial request of over $500 billion. From a statement released by the Administration:
The bill proposes cuts that would sharply undermine core government functions and investments key to economic growth and job creation and would reduce funding for the Department of Defense to a level that would leave the department without the resources and flexibility needed to meet vital military requirements….If the president is presented with a bill that undermines critical priorities or national security through funding levels or restrictions, contains earmarks or curtails the drivers of long-term economic growth and job creation while continuing to burden future generations with deficits, the president will veto the bill.
Contrast this stand-fast position on the military budget with Obama’s willingness to throw pretty much anyone else under the bus. John Walker provided a pithy illustration of the guns v. everything else tradeoff in a mock letter to low income Americans. Key section:
Read more...The most noteworthy bit of the AOL acquisition of HuffPo (aside from the price, which I assume will leak out sooner rather than later) is Arianna will run the AOL unit that will include the old HuffPo plus a bunch of other content businesses. It’s a pretty significant new media empire. From the joint announcement:
Read more...Thanks to Minyanville for publicizing this study by MindfulMoney on the nature and reach of social conversations in the investment arena. But even bigger thanks go to loyal readers and contributors for their frequent comments, leads, and critiques. The success of a blog depends on its community and I am very grateful for all the input so many of you have generously provided.
Perhaps the most interesting finding (boldface ours):
Read more...The research confirms the existence of a network of investment super-connectors with extraordinary media influence and reach. These super-connected new influentials are, for the most part, not well established voices in the media but individual bloggers who fiercely champion their independence….In the US, the network functions as the unofficial voice of Wall Street & the US federal bank with no mainstream media players at the centre of the network.
By Richard Smith
Readers of ECONned will be very familiar with the name of Gary Gorton, author of ‘Slapped in The Face by the Invisible Hand’, which explores the relation of the so-called shadow banking system to the financial crisis. His work is pretty fundamental to understanding some of the mechanisms which made the crisis so acute. Now he’s done an interview, which I would like to have a growl at.
It also happens that JP Morgan, originators of those not unmixed blessings, Value-At-Risk and Credit Default Swaps, are also thinking hard about how to get rehypothecation going in the grand style. They know a volume business with a cheap government backstop when they see one; they are on a marketing push, and presumably they have the systems and processes that go with it. That would be a Doomsday Machine…
Read more...This post’s headline misrepresents the apparent intent of a new Google filter in its advanced search function. Per the SearchEngineLand report, “Google Lets You Dumb Down Your Search Results With “Reading Level” Filter,” the aim is apparently to allow web surfers to steer clear of pages that might be too taxing.
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