LONDON | By Barclays analysts | There appears to be increasing market doubt over the sustainability of the “Japan trade”. Year- to-date, the yen has rallied more than 3%, while the Nikkei is down 11%, placing it among the worst performing indices of the year. This is due in part to concerns over the impact of the forthcoming fiscal drag as the VAT hike takes effect on April 1st.
WASHINGTON | By Mike Konczal at The New Republic, via The Next New Deal | Our problem today was not caused by a lack of business and banking regulations,” argued Ron Paul in his 2009 manifesto End the Fed, which outlined a theory of the financial crisis that only implicated government policy and the Federal Reserve, while mocking the idea that Wall Street’s financial engineering and derivatives played any role. “The only regulations lacking were the ones that should have been placed on the government officials who ran roughshod over the people and the Constitution.”
BEIJING | By H.Kaixi, W. Xiaobing and Y. Ning via Caixin | Since February, state-owned oil majors have taken steps toward pilots in mixed-share ownership, following central government calls for reforms to state-owned enterprises (SOEs). In a previous round of SOE reforms launched in 1998, the top three oil majors, CNPC, Sinopec and China National Offshore Oil Co. (CNOOC) underwent asset restructurings and went public abroad. But shortly thereafter reforms came to a halt. The competition that policymakers wanted to bring about never happened.
SAO PAULO | By Marcus Nunes | In “Mind the (spending) gap,” Atif Mian and Amir Sufi of Princeton and Chicago, respectively, are on the right track but go about it the wrong way and so arrive at a wrong conclusion. They wonder: We all know that households cut back on spending dramatically during the Great Recession. Are they spending now? Has spending caught up to the trend the United States was on before?
WASHINGTON | By Pablo Pardo | Prostitution is coming out of the closet. Not by getting any official credit -it’s still an illegal activity-, but thanks to the Internet. According to a study recently released by the U.S. Urban Institute, the Web is disrupting the pimp industry, causing a supply shock followed by a demand reaction. Sex workers don’t need middlemen to find clients anymore.
NEW YORK | By Nell Abernathy via Next New Deal |Unemployment is still a major problem in the U.S., and the best solutions involve a more aggressive government response. The skeptics will argue that the government is too inefficient and bureaucratic to effectively create middle class jobs and support economic growth. But the 2009 stimulus package provides a prime example of effective government intervention: it was designed to create 2-3 million jobs, and it succeeded.
SHANGHAI | By Andy Xie via Caixin | The current Internet boom and the new economy, centered around social networking, e-commerce and online gaming, has not produced a significant productivity boost for the economy and likely will not in the future. The boom is mostly about redistributing existing demand from offline to online.
MADRID | By Álex García.
SAO PAULO | By Marcus Nunes | That’s the image that came to mind when I saw this chart from Bank Paribas that Binyamin Appelbaum reproduced in his post [see above].
SEVILLE | By Ana Fuentes | When it comes to innovation and data management the U.S. is the absolute global leader. But Brussels wants to make up for many years of sitting on its hands: the cake is too yummy to allow Amazon or Google to eat it all. Fiware, a tech platform born from a public-private partnership, aims to finance an open ecosystem for SMEs to develop innovative projects. The budget for the best ideas is 100 million euros, way less than the American big firms are investing. But Spanish entrepreneurs eager to leave the crisis mood behind insist it’s worth to give it a try.