Föhrenbergkreis Finanzwirtschaft

Unkonventionelle Lösungen für eine zukunftsfähige Gesellschaft

Archive for 18. Januar 2020

Dethroning the dollar

Posted by hkarner - 18. Januar 2020

Date: 16‑01‑2020

Source: The Economist

America is weaponising its currency and financial system

Its use of sanctions could endanger the dollar in the long term

Ever since the dollar cemented its role as the world’s dominant currency in the 1950s, it has been clear that America’s position as the sole financial superpower gives it extraordinary influence over other countries’ economic destinies. But it is only under President Donald Trump that America has used its powers routinely and to their full extent, by engaging in financial warfare. The results have been awe‑inspiring and shocking. They have in turn prompted other countries to seek to break free of American financial hegemony.

In 2018 America’s Treasury put legal measures in place that prevented Rusal, a strategically important Russian aluminium firm, from freely accessing the dollar‑based financial system—with devastating effect. Overnight it was unable to deal with many counterparties. Western clearing houses refused to settle its debt securities. The price of its bonds collapsed (the restrictions were later lifted). America now has over 30 active financial‑ and trade‑sanctions programmes. On January 10th it announced measures that the treasury secretary, Steven Mnuchin, said would “cut off billions of dollars of support to the Iranian regime”. The State Department, meanwhile, said that Iraq could lose access to its government account at the Federal Reserve Bank of New York. That would restrict Iraq’s use of oil revenues, causing a cash crunch and flattening its economy. Den Rest des Beitrags lesen »

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Different views of AI fuel distrust between China and America

Posted by hkarner - 18. Januar 2020

Date: 16‑01‑2020

Source: The Economist: Chaguan

The two countries talk past each other about its risks

In the depths of the cold war, American and Soviet arms‑control negotiators pulled off something remarkable: an agreement so grimly logical that their mutual distrust did not matter. The superpowers pledged to stop building new systems to defend their respective homelands against nuclear missiles. Their Anti‑Ballistic Missile Treaty rested on a theory of mutual deterrence: the notion that the surest path to nuclear‑armed co‑existence lay in knowing that war would lead to catastrophe for both sides.

Today the rivalry between America and China is sliding into its own ice age of suspicion. Once again, new and unproved technologies—this time computer systems capable of performing superhuman tasks using machine learning and other forms of artificial intelligence (ai)—threaten to destabilise the global “strategic balance”, by seeming to offer ways to launch a knockout blow against a nuclear‑armed adversary, without triggering an all‑out war.

A report issued in November by America’s National Security Commission on Artificial Intelligence, a body created by Congress and chaired by Eric Schmidt, a former boss of Google, and Robert Work, who was deputy defence secretary from 2014‑17, ponders how ai systems may reshape global balances of power, as dramatically as electricity changed warfare and society in the 19th century. Notably, it focuses on the ability of ai to “find the needle in the haystack”, by spotting patterns and anomalies in vast pools of data. In a medical setting ai can find tumours that radiologists miss. In a military context, it may one day find the stealthiest nuclear‑armed submarines, wherever they lurk. The commission is blunt. Nuclear deterrence could be undermined if ai‑equipped systems succeed in tracking and targeting previously invulnerable military assets. That in turn could increase incentives for states, in a crisis, to launch a devastating pre‑emptive strike. China’s rise as an ai power represents the most complex strategic challenge that America faces, the commission adds, because the two rivals’ tech sectors are so entangled by commercial, academic and investment ties. Den Rest des Beitrags lesen »

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Italy’s second city shows up the rest of the country

Posted by hkarner - 18. Januar 2020

Date: 16‑01‑2020

Source: The Economist

Once dismissed for its dullness, Milan is booming

Mariateresa giussani lives in Seregno, 28km (17 miles) outside Milan, and drives to work in the central fashion district where the company she owns, which markets school uniforms, has its offices. “Ten years ago I would leave at 7.15am to avoid the traffic,” she says. “Now, I have to be out by 6.15am. If I leave ten minutes later, it’s nose‑to‑tail all the way.”

Ms Giussani’s altered morning schedule is among the myriad side effects of a boom that has set Milan apart from the rest of Italy, still struggling to recover from the financial crisis of a decade ago, and at best plodding along on the edge of recession.

“The city is on an enormous upswing,” says James Bradburne, the Canadian‑born director of Milan’s most renowned art museum, the Pinacoteca di Brera. Between 2014 and 2018, according to the regional bosses’ federation, Assolombardo, Milan’s output grew by 9.7%—more than twice the national rate. Property prices have leapt. Stories abound of out‑of‑towners paying €400 ($446) a week to rent a single room, residents offered 50% more than they paid for properties bought four years earlier and luxury‑goods firms paying €1m a year or more for an outlet in the Galleria Vittorio Emanuele II, which links La Scala theatre to the cathedral square. Den Rest des Beitrags lesen »

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