Tag Archives: economy

Recommended book: The New North: The World in 2050

The New North: The World in 2050. Laurence C. SmithThe New North: The World in 2050. Laurence C. Smith by Laurence C. Smith
My rating: 4 of 5 stars

This book raised significant interest here in Finland, and it is not difficult to see why. Reminds me a lot of Joel Diamond’s work (for good or bad) without the hysteria. You can see it started as a climate change study that turned into an exercise in geopolitical prospection. You might or might not agree with its future scenarios, but it was an interesting and not too heavy read.

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European Unity and its malcontents

I couldn’t agree more with the essay “Why America should care about the collapse of European Unity” by British historian Simon Schama. Read it first, but otherwise I will quote the last paragraphs:

Although it’s natural in brutally hard times to retreat back to tribal encampments encircled by walls of tariffs and fences against immigrants, this atomization of economic and political purpose needs to be resisted, on both sides of the Atlantic, if we are not to slide into another deep and dark age of violently angry populations and dangerously combative posturing.

Whether we like it or not, we are all—across the oceans and continents—entangled in a common destiny, perhaps more than ever in the entirety of the world’s history. We share the same predicament of a physically degraded planet; we are bound together—the Chinese bondholder and the American debtor; the Greek insolvent and the German banker—in the troubles of a common human home. Turning one’s back is not an option; it will merely guarantee that one day it will be stabbed by the mischief of history. To let the worst off sink is to make it harder for us all to swim. Better to hearken to John Donne: “No man is an island, entire of itself; every man is a piece of the continent … If a clod be washed away by the sea, Europe is the less, as well as if a promontory were …; any man’s death diminishes me, because I am involved in mankind, and therefore never send to know for whom the bell tolls …”

You know the rest. Take it to heart.

Argentines 10 years ago, Russians and Brazilians now

My family has visited Cancún since the 1970’s. When I was a teenager I loved to hook-up with Argentine and Paraguayan girls my age who would be coming over as it was quite cheap for them back then (in the times of the convertible peso). Now, a quite easy visa regime and direct flights mean that in the Mexican off-season after January 6th it’s chock-full of Russian and Brazilian tourists besides a few Americans & locals. Wouldn’t be surprised if in a few years the Chinese start holidaying there too.

Economic growth keeps on going strong in Mexico

The Mexican economy recovered from the 2008-09 crisis, growing 5.5% in 2010 and 3.9% in 2011.  People are shopping heavily during Christmas, there is a lot of infrastructure development, and even access to credit seems to be better. While the headlines are dominated by violence, poverty and the like, the economic climate to me feels much, much better than the one in Europe.

Update (26.3.2012): On macroeconomic terms, even the US Federal Reserve tends to agree: Mexico’s Economic Growth Strong, Offers Lessons for U.S. and Europe

Gentrification, degentrification

During the life or a city, certain neighbourhoods will rise and some others will fall. It was with great sadness that I realised that the street where I grew up for 19 years has degentrified, which is a nice way of saying it’s gone to the boondocks. Most of the neighbours I knew have moved away, and the houses now have fencing they wouldn’t have required when I lived there. Sad as it was a great place.

Cronicles of a European crisis

It’s been a tough 2011 for Europe and it’s going to get tougher. The role of Finland in this whole mess is deeply contested, and is a result of the changes in Parliament after the elections last spring.  I personally think Finnish politicians are too smug (see Halla-Aho’s Greece comments).  They treat other countries in the EU like a poor relation, but they seem to forget that Finland might be on the receiving end of EU aid sooner than we would like.  While the current budget deficit is quite manageable, Finland has the fastest-aging population in Europe.This will have a huge impact in social services and pensions, so I would hope for a return to traditional Finnish caution from the current brashness.

If I put my Mexican hat on, it is very ironic to see developed countries not following their own rules and recommendations for economic recovery (see cartoon in Spanish).  I guess the IMF’s medicine is too bitter when you try it yourself.

Below you can see some pictures I’ve taken that show the discontent from the general public in different parts of the continent.

Protests in Corinth.
Austerity protests in Athens
Traffic rerouted due to the austerity protests in Athens.
Strong opinion
Strong opinions in the London tube.
Somebody tell me how much they make with my money
Madrid. "Somebody tell me how much they make with my money" / "You should understand what they say".

Recommended book: The Ascent of Money

This is a very interesting book by Niall Ferguson that has already been reviewed here and here. It also has a companion TV documentary.

Behind each great historical phenomenon there lies a financial secret, and this book sets out to illuminate the most important of these. For example, the Renaissance created such a boom in the market for art and architecture because Italian bankers like the Medici made fortunes by applying Oriental mathematics to money. The Dutch Republic prevailed over the Hapsburg Empire because having the world’s first modern stock market was financially preferable to having the world’s biggest silver mine. The problems of the French monarchy could not be resolved without a revolution because a convicted Scots murderer had wrecked the French financial system by unleashing the first stock market bubble and bust.

This should be required reading or viewing for everybody who handles money every day i.e. for all of us. For good or ill our livelihood depends on understanding the financial events around us but in order to graduate from high school you need to understand science, biology and language but not how to calculate compound interest. Money, as they say, is portable power. Get something to eat and watch the full TV documentary below (also divided by episodes in the PBS website).