Kaput. Fini. Terminado. 完. законченный. Done. Over. No more.
Dan Harris writes: Not sure why nobody has just come out and said this yet, but Hong Kong as an international business and financial center is no more. I take no comfort in saying this because I have many friends in Hong Kong and I’ve always loved going there, but Hong Kong’s special position is over. Kaput. Fini. Terminado. 完. законченный. Done. Over. No more.
I challenge you to say “one country two systems” with a straight face.
For the last few months I have been relentlessly asking everyone I know in Hong Kong or who used to be in Hong Kong or who at one time contemplated setting up a business in Hong Kong how what has been happening in Hong Kong has and will or would impact their doing business in Hong Kong. Based on those responses and on my own experience with how international companies operate, I foresee the following:
- Companies that were deciding between Hong Kong or Singapore for their Asian headquarters will choose somewhere other than Hong Kong.
- Growing companies with offices in Hong Kong and with offices somewhere else in Asia will increase their hiring outside Hong Kong and decrease or eliminate their hiring in Hong Kong.
- Companies with offices in Hong Kong and with offices somewhere else in Asia will be move personnel from their Hong Kong office to their other offices.
- Fewer contracts will be drafted with Hong Kong as the venue for arbitration.
- Companies will move their Hong Kong bank accounts elsewhere. It is no coincidence HSBC stock hit its 52 week low today.
- Travelers will choose somewhere other than Hong Kong as their Asia stopover. It is no coincidence Cathay Pacific stock hit its 52 week low today.
- Many Hong Kongers will eventually go elsewhere.
After employees allegedly opened 2 million fake accounts.
James Pethokoukis: Does Lower Labor Force Participation Mean the 5% US Unemployment Rate is a Phony Number?Posted: December 9, 2015
James Pethokoukis writes: The current 5% unemployment rate is half its worst level of the Great Recession. But the jobless rate would be 10.1% if the labor force participation rate — which feeds into the unemployment rate — were back at pre-recession levels. So what is the “real” unemployment rate? The other day, I quoted a new Goldman Sachs study on the LFPR issue:
What about the 3.6pp decline in the labor force participation rate since 2007? While it’s true that the unemployment rate would be much higher if participation had remained stable, we now believe most of the decline since that time should be considered structural. By far the largest contribution to the decline in participation has been an increase in retirees—mostly a natural consequence of the aging of the workforce. Rising disability rates—a trend mostly driven by demographics—and a tendency for young people to remain in school have also played a role.The remaining cyclical component is a relatively modest share of the labor force, and broadly captured by the U6 unemployment rate, in our view.
And n0w the San Francisco Fed offers a similar perspective:
First is the aging of the population. The baby boomers are entering retirement and people are living longer. Remember, the participation rate counts everyoneover 16, so my happily retired parents count as “out of the labor force,” even though, in their 80s, few people would still be working. Second is that younger people aren’t working as much as they used to. But this is partly because many have extended their education or gone back to school, and fewer are working when they’re there. Third is an increase in people deciding they’d rather have single-income families (Bureau of Labor Statistics 2007–2014). For whatever reason, they’ve traded a second paycheck for spending more time at home, whether it’s for child care, leisure, or simply that it’s a better lifestyle fit. Each of these groups is made up of people who are not working, but doing so for personal or demographic reasons. As their numbers swell, it will, obviously, push the participation rate down.
As for the area of concern, we’re emerging from the deepest, longest recession since the Great Depression. And it’s true that a lot of people did give up looking for work. A key indicator is the somewhat unfairly named “prime-age males” cohort, who are 25–54. This group has historically been a constant in the American workforce, but in the wake of the recession, its participation fell sharply. However, as the labor market has improved, that number has largely stabilized over the past two years, as has the overall participation rate.
The last factor to consider is whether there are people who will reenter the labor force and pull the participation rate back up. The “marginally attached” for instance, a group made up of people who are ready and able to work and who’ve searched for jobs in the past year but who aren’t currently looking. The assumption would reasonably be that this group is poised to return to the labor force. First off, these numbers have come down a lot, falling by over 12% in the past year alone. In addition, my staff has found that, over the past few years, their reentry rate back into the labor force has actually fallen. When you combine this with the aging workforce, it looks unlikely that participation will rise. This is supported by other research from both within and outside the Fed System (Stephanie Aaronson et al. 2014 and Krueger 2015). Overall, the evidence suggests that, even with a quite strong economy, we won’t see a significant number of people come back into the fold.
She even made more money speaking to UBS and Goldman Sachs than her husband Bill did.
As Clinton tries to talk tough about how she will stand up to America’s biggest banks, her Democratic rivals are likely to remind voters just how cozy she’s been with Wall Street.
“Her closeness with big banks on Wall Street is sincere, it’s heart-felt, long-established and well known.”
— former Maryland Governor Martin O’Malley
While Clinton has given paid speeches to many groups, Wall Street banks and investment houses made up a third of her speech income.
She even made more money speaking to UBS and Goldman Sachs than her husband Bill did. Goldman Sachs in New York paid Bill $200,000 for a speech in June 2013 and Hillary $225,000 for a speech in October of that year.
“If the other candidates want to make this an issue, they’ve got plenty of material.”
— Larry Sabato, director of the University of Virginia Center for Politics.
Sanders has been outspoken that the big banks are still “too big to fail” and should be broken up.
“Bitcoin is punk rock and you can’t turn it into smooth jazz just to satisfy the sensibilities of a timid boardroom.”
Presenting as part of the session “Beyond Bitcoin, Unleashing the Blockchain“, Andreas M Antonopoulos opens with a contrarian perspective. It’s not about “beyond bitcoin”, and you can’t put this technology on a leash to make it more palatable.
Bitcoin is the real thing, the revolutionary and disruptive technology that can’t be tamed.
Before Dodd-Frank’s passage, former Sen. Chris Dodd said that ‘no one will know until this is actually in place how it works.’ Today we know.
House Financial Services Committee Chairman Jeb Hensarling writes: Tuesday will mark five years since President Obama’s signing of the Dodd-Frank law, the most sweeping rewrite of the country’s financial laws since the New Deal. Mr. Obama told the country that the legislation would “lift our economy.” The statute itself declared that it would “end too big to fail” and “promote financial stability.”
“What is most disturbing about Dodd-Frank is the authority it gives bureaucrats to control huge swaths of the economy.”
None of that has come to pass. Too-big-to-fail institutions have not disappeared. Big banks are bigger, small banks are fewer, and the financial system is less stable. Meanwhile, the economy remains in the doldrums.
Dodd-Frank was based on the premise that the financial crisis was the result of deregulation. Yet George Mason University’s Mercatus Center reports that regulatory restrictions on financial services grew every year between 1999-2008. It wasn’t deregulation that caused the crisis, it was dumb regulation.
The law has crushed small banks, restricted access to credit, and planted the seeds of financial instability.
“Oversight? CFPB funding is not subject to congressional appropriations, and Dodd-Frank requires courts to grant the bureau deference regarding its interpretation of federal consumer-financial law.”
Among the dumbest were Washington’s affordable-housing mandates, beginning in 1977, that led to a loosening of underwriting standards and put people into homes they couldn’t afford. The Federal Reserve played its part in the 2008 financial crisis by keeping interest rates too low for too long, inflating the housing bubble. Washington not only failed to prevent the crisis, it led us into it.
“Before Dodd-Frank, 75% of banks offered free checking. Two years after it passed, only 39% did so—a trend various scholars have attributed to Dodd-Frank’s ‘Durbin amendment,’ which imposed price controls on the fee paid by retailers when consumers use a debit card. Bank fees have also increased due to Dodd-Frank, leading to a rise of the unbanked and underbanked among low- and moderate-income Americans.”
Dodd-Frank was supposedly aimed at Wall Street, but it hit Main Street hard. Community financial institutions, which make the bulk of small business loans, are overwhelmed by the law’s complexity. Government figures indicate that the country is losing on average one community bank or credit union a day.
“Because of Dodd-Frank, financial markets will have less capacity to deal with shocks and are more likely to seize up in a panic. Many economists believe this could be the source of the next financial crisis.”
Before Dodd-Frank, 75% of banks offered free checking. Two years after it passed, only 39% did so—a trend various scholars have attributed to Dodd-Frank’s “Durbin amendment,” which imposed price controls on the fee paid by retailers when consumers use a debit card. Bank fees have also increased due to Dodd-Frank, leading to a rise of the unbanked and underbanked among low- and moderate-income Americans. Read the rest of this entry »
Clinton Foundation donors include dozens of media organizations, individuals
…The following list includes news media organizations that have donated to the foundation, as well as other media networks, companies, foundations or individuals that have donated. It is organized by the size of the contribution:
Chairman & CEO of Telmex, largest New York Times shareholder
Chief Operating Officer of 21st Century Fox
Florida-based conservative media network
Owner of the Reuters news service
News Corporation Foundation
Philanthropic arm of former Fox News parent company
Houghton Mifflin Harcourt
Richard Mellon Scaife
Owner of Pittsburgh Tribune-Review
Former CBS, CBS News and Sony executive
Intermountain West Communications Company
Local television affiliate owner (formerly Sunbelt Communications)
Discovery Communications Inc.
ABC News chief anchor and chief political correspondent
Owner of New York Daily News and U.S. News & World Report
Time Warner Inc.
Owner of CNN parent company Turner Broadcasting
Hollywood Foreign Press Association
Presenters of the Golden Globe Awards
Non-profit foundation dedicated to supporting journalism
Public Radio International
Parent company of CNN
Parent copmany of NBCUniversal
Parent company of NBC News, MSNBC and CNBC
Public Broadcasting Service
Owner of POLITICO parent company Capitol News Group
AOL Huffington Post Media Group
PBS Newshour co-anchor and managing editor
The Washington Post Company
WashingtonExaminer reports: Officials of the Export-Import Bank of the United States blew the agency’s travel budget by millions of dollars after taking 400 first-class flights over the last three years, according to records obtained under the Freedom of Information Act.
“Conservatives in Congress have long sought to defund Ex-Im as a corporate welfare program, while President Obama has defended it as a job creator.”
“In fiscal 2012, Ex-Im budgeted $1.7 million for travel expenses but spent $2.7 million. In fiscal 2013, Ex-Im budgeted $1.2 million but spent $2.2 million. And in this fiscal year, Ex-Im budgeted $1.3 million but expects its end-of-year spending to total $2.3 million.”
Last month, the Hill reported that “officials with the Export-Import Bank have exceeded their travel budget over the last three years by $3 million, according to disclosures filed with the House Financial Services Committee.
“A NASA employee flew from Frankfurt to Cologne, Germany, for $6,851, a flight that cost almost 52 times more than the $133 coach fare.”
But documents newly obtained by the Washington Examiner show that it was not just the frequency of the travel that caused Ex-Im officials to exceed their budget, but the way they chose to travel. Read the rest of this entry »
Call it the new China Syndrome: Although Asia’s biggest economy is slowing down markedly, credit continues to surge. Dead-end projects and dying industries are sucking up an ever-larger portion of new credit, while more productive borrowers are starved for funds.
Nowhere is this more evident than in China’s shadow banking sector, the non-bank financiers that have pumped credit into the economy at a spectacular rate. Trust companies – firms that sell investment products to Chinese savers and use the proceeds to make loans or buy other types of assets – have posted the fastest growth.
A Reuters examination of proprietary data shows that as little as half of trust loans issued in 2012 were used to finance current economic activity, such as a new investment project or increased production at an existing factory.
The other half may have been used for refinancing old debt that funded past projects but is…
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Not quite (or at all) sure what hordes of nude, nearly anatomically correct mannequins (tellers, maybe?) and exploding tombs have to do with fine banking, but it sure looks like more fun than using a Bank of America ATM. (via >> Dangerous Minds)
via >> Russian Bank Commercial