January, 2019

• 16 January

  What Sears and GE’s decline teaches us about capitalism

  

  General Electric (GE) and Sears have fallen on hard times, and that tells us a lot about US capitalism. Both were once great enterprises — symbols of American ingenuity and imagination. The temptation will be to blame their troubles on mismanagement. The real lesson is starker. It is that no business, no matter how historically innovative or powerful, is guaranteed ...

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• 16 January

  China’s consumer waves are all spent

  

  Consumerism in post-1978 China has ridden five waves: from finding a solution to food shortages; to owning the “new big three” (refrigerator, colour TV and washing machine); spending more on information; buying automobiles; and finally, real estate. All the swells are now spent, according to Renmin University economist Xiang Songzuo. Using stimulus to reverse the first annual decline in car ...

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• 16 January

  Virtuous investing is starting to pay off

  

  For investors trying to take into account environmental, social and governance concerns, the best response seems to have been to adopt a version of St. Augustine’s prayer: “Oh Lord, make my strategy pure, but not too quickly.” For whenever the issue of socially responsible stock-picking arises, so too does the suspicion that doing good comes at a price. A study ...

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• 16 January

  May’s crushing loss is proof Brexit has failed

  “Defeat” is too small a word for the rebuke Britain’s Parliament handed Prime Minister Theresa May yesterday. Her Brexit deal, laboriously negotiated over many months, was voted down on Tuesday by a massive 230 votes — a far bigger margin than expected, and the worst loss of any British government in modern times. Yet if this brutal rejection has caused ...

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• 16 January

  Cold warriors hold the key to handling China

  

  At times of great global upheaval, policymakers often reach for familiar historical analogies to help them make sense of an uncertain future. Consider the debate over whether the deepening confrontation between the US and China constitutes a “new Cold War.” It is a marker of how quickly US-China relationship has deteriorated that commentators are invoking the analogy. Only three years ...

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• 16 January

  Facebook’s privacy problems get real

  

  Germany is about to remind Facebook Inc. that the tribulations of 2018 are far from over. In fact, they’re about to get even more real. The country’s Federal Cartel Office intends to ban Facebook from collecting user data from third parties, the newspaper Bild am Sonntag reported. This will also prohibit data sharing between WhatsApp and Instagram, which Facebook owns. ...

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• 16 January

  The Australian dream died alone in an apartment

  

  For people in the US, the American Dream is a vision of broadly shared prosperity, freedom and opportunity. Xi Jinping’s Chinese Dream focuses on rising incomes and national renewal. Australians once had a simpler aspiration: owning a detached suburban home on a quarter-acre of land. That vision died a while ago. Back in the 1980s, single-family detached homes comprised about ...

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• 16 January

  China’s small banks face tough 2019 after orders to shrink

  

  Bloomberg China’s smaller banks, among the hardest hit by President Xi Jinping’s crackdown on risky financing, are set for a tougher 2019 as authorities force them to shut business lines that once powered profit growth. Authorities have ordered the nation’s provincial lenders to limit business to the region they’re based in, or wind down by the end of this year, ...

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• 16 January

  No recession ahead for euro area: Draghi

  

  Bloomberg The euro-area economy isn’t headed for a recession, even though softening momentum underscores the need for European Central Bank stimulus, according to President Mario Draghi. “The question we should ask is: Is this a sag or heading towards a recession?” Draghi told members of the European Parliament in Strasbourg. “The answer we give is: No, it’s a slowdown, which ...

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• 16 January

  Orcel’s rise to Santander CEO ruined by UBS pay dispute

  

  Bloomberg Banco Santander SA reversed course on installing Andrea Orcel as its next chief executive officer after a standoff over tens of millions of dollars in deferred pay. UBS Group AG held a hard line that Orcel, who led its investment bank until a few months ago, was defecting to a rival and wouldn’t receive bonuses he was owed from ...

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