Föhrenbergkreis Finanzwirtschaft

Unkonventionelle Lösungen für eine zukunftsfähige Gesellschaft

Posts Tagged ‘WSJ’

Who Unraveled the New World Order?

Posted by hkarner - 14. Juni 2018

Date: 13-06-2018
Source: The Wall Street Journal By David M. Smick

It wasn’t Trump. The global economic consensus began falling apart years before he entered politics.

European Council President Donald Tusk recently said that Donald Trump’s approach to trade, climate change and the Iran nuclear deal is undermining “the rules-based international order.” This is absurd. The global order began unraveling long before Mr. Trump’s debut on the world stage.

Start in 1989. That remarkable year saw the fall of the Berlin Wall, the collapse of the socialist model, and the rise of globalization. By the early 1990s, China, India, Eastern Europe and a host of commodity-producing countries had joined the global capitalist club.

That was the beginning of the so-called Washington Consensus—a new global order based on deregulating market access, liberalizing capital and trade flows, encouraging domestic competition, fortifying the rule of law, and reducing taxes, debt and market subsidies. By 1995, the leaders of this new world order established the World Trade Organization, which China joined six years later. Den Rest des Beitrags lesen »

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White House Trade Official Apologizes for Insulting Canada’s Trudeau

Posted by hkarner - 13. Juni 2018

Date: 13-06-2018
Source: The Wall Street Journal

Peter Navarro says he was wrong to say there was ‘special place in hell’ for leaders like Justin Trudeau who cross Trump

National Trade Council adviser Peter Navarro.

WASHINGTON—President Donald Trump’s senior trade adviser apologized Tuesday for making comments attacking Canadian Prime Minister Justin Trudeau, saying they were inappropriate.

Peter Navarro had said on Sunday there was a “special place in hell for any foreign leader that engages in bad-faith diplomacy” with Mr. Trump “and then tries to stab him in the back on the way out the door. That’s what bad-faith Justin Trudeau did.”

On Tuesday, Mr. Navarro said he had been trying to use strong words to back Mr. Trump’s trade stance but went too far.

“In conveying that message I used language that was inappropriate and basically lost the power of that message,” he said. “I own that, that was my mistake, those were my words.”

He made the comments Tuesday at an event of The Wall Street Journal CFO Network in Washington. When asked by the Journal interviewer if he was apologizing, Mr. Navarro said, “Yes, absolutely.” Den Rest des Beitrags lesen »

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Bitcoin Falls Sharply After Another Cryptocurrency Exchange Is Hacked

Posted by hkarner - 12. Juni 2018

Date: 11-06-2018

Source: The Wall Street Journal

The largest cryptocurrency has lost more than half its value this year

Since 2014, cryptocurrency exchange hacks have cost investors at least $1.4 billion, according to an analysis by The Wall Street Journal.

A South Korean cryptocurrency exchange said it suffered a “cyberintrusion,” prompting bitcoin prices to fall sharply toward year lows.

Bitcoin dropped more than 10% over the weekend, falling below $6,700, according to research site CoinDesk. The largest cryptocurrency has lost more than half its value this year, falling by nearly two thirds from its record high near $20,000 in December. Its low for the year came in February at less than $6,000. Den Rest des Beitrags lesen »

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The Age of Tech Superheroes Must End

Posted by hkarner - 9. Juni 2018

Date: 08-06-2018
Source: The Wall Street Journal

Silicon Valley has an accountability crisis, and at its root is the idolatry of its founder-CEOs

Elon Musk, shown in 2017, holds 22% of Tesla but effectively has full control of the auto maker. A shareholder bid to oust him from the chairman’s seat failed this past week, but he faces a shareholder lawsuit.

Whether it’s Theranos Chief Executive Elizabeth Holmes or ousted Uber CEO Travis Kalanick, or the heads of currently troubled public companies like Evan Spiegel of Snap and Elon Musk of Tesla, powerful founder-CEOs who were once lauded for flouting convention are facing a new reality: They aren’t superheroes, after all.

Treating them as if they were has been bad for their companies and investors alike.

It’s understandable how we got here—the genius tech founder mythology has its roots in the pantheon of real-world demigods widely credited with revolutionizing industry, from Thomas Edison and Gordon Moore to Steve Jobs and Jeff Bezos. Investors and experts in corporate governance say the problem is that building corporations and stock-market valuations on the notion that every tech CEO is potentially building another Apple is ridiculous and counterproductive.

“If your only argument is Steve Jobs or Jeff Bezos, you don’t have an argument—you have a couple of exceptions,” says Paul Kedrosky, a partner at early-stage investment firm SK Ventures. Den Rest des Beitrags lesen »

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It’s high time for a two speed Europe

Posted by hkarner - 7. Juni 2018

Date: 05-06-2018
Source: The Wall Street Journal
Subject: Italy’s Euroskeptic Agenda Reflects Weakening Public Support for the EU

In his inaugural speech, Prime Minister Giuseppe Conte says his government will challenge eurozone rules

ROME—Italy’s new government is laying the groundwork to challenge Europe’s financial orthodoxy and immigration rules, setting out a euroskeptic policy agenda in a country where public frustration with the European Union has supplanted once-broad support.

In his inaugural speech to Parliament on Tuesday, Prime Minister Giuseppe Conte said his government would push for a change of the rules underpinning the eurozone to spur growth and cut the country’s massive debt, which he said austerity policies helped worsen.

“A new wind” is blowing in Italy, said Mr. Conte, who heads a government supported by the maverick 5 Star Movement and the hard-right League, which have come out strongly against the eurozone’s limits on public spending. Den Rest des Beitrags lesen »

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A Decade Later, U.S. Stocks Behave Like Lehman Never Happened

Posted by hkarner - 6. Juni 2018

Date: 05-06-2018
Source: The Wall Street Journal

The world’s financial system had its worst crisis in generations a decade ago, but U.S. stock-market returns belie that fact

If all you had to go on was the return on U.S. stocks over the past decade, you’d never guess that the world’s financial system had its worst crisis in generations, let alone that stocks had their biggest crash since World War II. The U.S. market has had a vintage 10 years, and returns—even including the calamity that was just appearing on the horizon in the summer of 2008—have been far better than the long-run norm.

An investor who simply bought the S&P 500 in June 2008 and ignored the market carnage that followed has scored gains of more than 9% annualized, including reinvested dividends, only fractionally below the average nominal return since 1900. But because inflation has been so low, real returns after inflation of 7.8% have been well above the long-term average for the U.S. market of 6.5% calculated by London Business School academics Elroy Dimson, Paul Marsh and Mike Staunton.

The result is far different from what followed deep recessions and financial crashes in the 1930s and 1970s, when it took a decade or more for stocks just to recover to precrash levels in real terms, let alone make money. The question for investors is whether the speedy recovery from 2009 is an optimistic sign that things are better in the U.S. than generally believed, a demonstration of the ability of investors to ignore reality for extended periods, or a happy illusion created by the Federal Reserve.

The evidence provides partial support for each view. Den Rest des Beitrags lesen »

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Merkel Responds to Macron’s Plan to Overhaul EU With One of Her Own

Posted by hkarner - 5. Juni 2018

Date: 04-06-2018
Source: The Wall Street Journal

German chancellor’s suggestions, including combining defense capabilities and building a common eurozone investment fund, draw praise from France

German Chancellor Angela Merkel outlined proposals for overhauling and strengthening the architecture of the European Union in an interview published on Sunday, including combining nations’ defense capabilities and building a common investment fund for the eurozone.

While the suggestions broadly matched known German positions about the bloc’s future, they marked Ms. Merkel’s most direct and detailed reaction to proposals for overhauling the EU that French President Emmanuel Macron laid out in September.

The proposals, including beefing up an existing backstop for cash-strapped members of the eurozone and creating a joint budget for the currency union, came after capital markets briefly sank after the formation of a populist Italian government last week, evoking memories of the 2010 eurozone crisis. Den Rest des Beitrags lesen »

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Why Italy Is Flirting with Euro Exit and Spain Isn’t

Posted by hkarner - 5. Juni 2018

Date: 04-06-2018
Source: The Wall Street Journal

Spain suffered far more than Italy during the euro crisis, but the major Spanish parties are committed to staying in the common currency

Italy and Spain got new governments last week. But while Italy’s change of leadership led markets on a roller coaster, Spain’s was met with a yawn. The reason: Their economies have followed different paths, and so have their attitudes to the euro. The populists who make up Italy’s new government have toyed with exiting the common currency, whereas all of Spain’s major parties are committed to staying in.

This isn’t what you would have predicted six years ago; Spain suffered far more than Italy during the euro crisis. But it also reformed its economy much more and has enjoyed a much stronger recovery; gross domestic product is now above its precrisis peak. By contrast, Italy’s economic problems long predate the euro, and its failure to fix them has left GDP 5% below its prior peak and voters receptive to radical economic prescriptions. Den Rest des Beitrags lesen »

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The other G-7 Members should have stayed away

Posted by hkarner - 4. Juni 2018

Date: 03-06-2018
Source: The Wall Street Journal
Subject: G-7 Members Condemn U.S. Trade Actions

Ministers of developed nations express ‘unanimous concern and disappointment’ with U.S. tariffs

WHISTLER, British Columbia—Six finance ministers, representing some of the closest allies of the U.S., issued a stern rebuke of the protectionist policies of the administration of President Donald Trump, signaling a deep rift in the relations underpinning the post-World War II trading system.

The ministers of the six non-U.S. members of the Group of Seven industrialized nations—the host Canada, along with France, Germany, the U.K., Italy and Japan—on Saturday issued a joint statement excluding the U.S., and conveying their “unanimous concern and disappointment” with the U.S. decision last week to impose tariffs on steel and aluminum imported from the European Union, Canada and Mexico. Den Rest des Beitrags lesen »

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The New Tech That Terrifies OPEC

Posted by hkarner - 3. Juni 2018

Date: 02-06-2018
Source: The Wall Street Journal

U.S. shale oil drillers are boosting efficiency with giant pads and walking rigs, lowering prices to a point that could hurt exporters like Saudi Arabia.

What doesn’t kill you makes you stronger.

Two years ago, it looked like Saudi Arabia was winning its fight against the U.S. shale oil industry by furiously pumping crude to drive down prices. Some drillers went bust and many more flirted with bankruptcy while oil drilling in places like West Texas and North Dakota collapsed.

The Saudi effort backfired. Instead of killing shale it spurred a wave of innovation that transformed drilling in the U.S. into a highly efficient industrial process, dramatically lowering costs and boosting output. During the next oil bust, it will be the Saudis who have to worry.

“High prices tend to create sloppiness in this industry because people focus only on growth,” says Doug Suttles, chief executive of shale driller Encana. “Downturns make you focus on cost because it’s the only thing you can control—the oil price is out of your hands.” Den Rest des Beitrags lesen »

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