China’s growth model disrupts the world order
By Edward Hadas
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
China’s growth is disrupting the world order. It’s not just the size of the economy, set to surpass that of the euro zone around 2017, according to Axa Investment Management. Nor is it the country’s rapid growth. It is more the way China has made three big accepted ideas about development seem wrong. The effects could be temporary – or disastrous.
Thailand’s unsustainable boom is piling up risks
By Andy Mukherjee
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Thailand is booming again, but the foundations of its growth revival are wobbly. Unless policies and politics become more robust, the Southeast Asian nation’s economy may find its momentum hard to sustain.
Flu epidemic exposes U.S. risk management flaws
By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
In a typical year influenza inflicts about $90 billion worth of economic damage and kills about 36,000 Americans – and this year’s epidemic is shaping up to be worse. Yet Uncle Sam spends far more on homeland security than on flu prevention. Poor resource allocation can be a hard thing to cure.
India in depth: Crying out for corporate bonds
By Andy Mukherjee
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
India is crying out for corporate bonds. The country’s bank-dominated financial system is not well-suited to fund the $1 trillion infrastructure investment targeted by the government under its current five-year plan. Corporate bonds could be a helpful alternative, but the authorities are stifling the development of a genuine debt market.
Shifting trade winds catch Li & Fung off-guard
By John Foley
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Once upon a time, manufacturing was relatively simple: China produced and America bought. That’s changing, and supply chain companies like Hong Kong-listed Li & Fung are doing their best to adapt. A Jan. 11 profit warning that wiped the equivalent of $2.2 billion from the company’s valuation shows there’s plenty of room for error.
Beware bond-equity rotation and focus on value
By Robert Cole
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Investors have started 2013 feeling bold. Equities are firm, bonds are weak and gold is soft. Is this the long-awaited rotation back to risk? Many market participants say so. But betting on a herd movement is a dangerous investment strategy.
Japan’s fiscal stimulus is call for action to BOJ
By Andy Mukherjee
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Japan’s new prime minister has thrown the country’s central bank a $117 billion challenge.
Venezuelan political folly is a cue for investors
By Raul Gallegos
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
The political folly in Venezuela is a cue for investors. Allies of ailing President Hugo Chavez seem to be taking even greater liberties interpreting the constitution than expected. There’s no inauguration, caretaker government or sign of a new election. If markets truly hate uncertainty, then animus toward Venezuela should be off the charts.
This time it’s different for capital-markets cycle
By Dominic Elliott
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
History rhymes, even in the capital markets. Global issuance in three major asset classes seems to follow a pattern after a financial crisis, Thomson Reuters data shows. And many equities bankers think it’s happening again. First there was a recovery in investment-grade debt. Then junk bonds picked up. If previous cycles are any guide, this year should see a revival in initial public offerings.
A how-to guide for Japan to escape deflation
By Andy Mukherjee
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Japan has a real chance of ending deflation. But the authorities need to act boldly. It will be hard for the Bank of Japan to dispel a decade of accumulated pessimism by merely adopting a formal inflation target. The goal of the central bank and the finance ministry should be to make people believe that price gains that didn’t occur in the past 10 years will now take place. A de facto currency peg may be the way to engineer those expectations.
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Predictions 2013: Exploring the year ahead.
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Your picture of China is unreasonally black. While it is true that China is facing many problems, but you have failed to see many other factors taht have contributed to China’s success and these factors might be the ones that contributed to the failure here in the U.S.
These factors include (1) people who grow up after China opened her door, who have been exposed to outside ideas and who are the force for progress and for perpectuating the progress China has thus made; (2) education. While the myth has been like this — Chinese students are good at book learning and not as innovative and creative as western students. But one of the PISA test (2009) results demonstrate the quality of Chinese education, which has been nourished and supported by families. While education has always been the strenght in Asian countries, the U.S.-led western world more and more show declines in their education achievement, especially in U.S. which leads it more and more unable to fill its high-tech labor market. (3) Hard work ethic. Compare to the U.S. China has a lot less social parasites living on the wellfare of the states and the government. Chinese people, no matter who they are, are praised and famous for their hard work, which will turn into high productivity. On the other hand, in the U.S. with the jobs shipped overseas, there is less and less productivity as less people produce value. A country cannot expect grow through consumption. Imagine what it is like when all goes to consume and nobody produces?