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Friday, March 27, 2009
Thursday, March 19, 2009
The recession's Churchillian moment?
To quote Churchill
"Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning."
Or, in econospeak:
"I don't think that this is the beginning of a recovery. It's the beginning of a much slower pace of decline," said Ethan Harris, an economist with Barclays in New York. "You've got to walk before you run."
U.S. economy shows signs of crawling out of hole | Reuters
"Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning."
Or, in econospeak:
"I don't think that this is the beginning of a recovery. It's the beginning of a much slower pace of decline," said Ethan Harris, an economist with Barclays in New York. "You've got to walk before you run."
U.S. economy shows signs of crawling out of hole | Reuters
Thursday, March 12, 2009
The secret of beating Google
NYTimes highlights a key challenge of trying to use technology to beat Google. Sure, other search engines may come up with different, new and maybe by some standard, better technology, but what they won't have is Google's stickiness. Google isn't so much a search engine as it is a sense of habit.
Even though other search engines are one click away, part of Google's competitive advantage is that have managed to create a psychological bond with consumers that keeps them hooked.
Here's part of the NYT's take on the issue:
More important, successful companies succeed for many reasons in addition to the quality of their products. When a technology start-up begins to do well, it is like a snowball rolling downhill, as technology, packaging, marketing, sales, customers, developers, brand reputation and a lot of luck bind together to create momentum that then feeds on itself.
Back to Microsoft: There are lots of people who believe that there are better operating systems available today than Windows. The question is, how very much better do they have to be, and what else needs to happen, to unwind the self-reinforcing ecosystem that lets Microsoft dominate the PC business? Windows now is just one of Microsoft’s products.
Better Search Doesn’t Mean Beating Google - Bits Blog - NYTimes.com
Even though other search engines are one click away, part of Google's competitive advantage is that have managed to create a psychological bond with consumers that keeps them hooked.
Here's part of the NYT's take on the issue:
More important, successful companies succeed for many reasons in addition to the quality of their products. When a technology start-up begins to do well, it is like a snowball rolling downhill, as technology, packaging, marketing, sales, customers, developers, brand reputation and a lot of luck bind together to create momentum that then feeds on itself.
Back to Microsoft: There are lots of people who believe that there are better operating systems available today than Windows. The question is, how very much better do they have to be, and what else needs to happen, to unwind the self-reinforcing ecosystem that lets Microsoft dominate the PC business? Windows now is just one of Microsoft’s products.
Better Search Doesn’t Mean Beating Google - Bits Blog - NYTimes.com
Friday, March 06, 2009
Different ideas of value
So CalTrain has introduced the new 8-ride ticket to replace the old 10-ride tickets. Here is a direct quote I got from some of their marketing material:
"Like the 10-ride, the 8-ride will have a 60-day expiration and have the same pricing structure so you receive the same ride value"
I guess we all have different ideas of "value", but it seems to be a very odd definition indeed when you try to say that getting 8-rides for the same price as 10-rides is "the same ride value."
"Like the 10-ride, the 8-ride will have a 60-day expiration and have the same pricing structure so you receive the same ride value"
I guess we all have different ideas of "value", but it seems to be a very odd definition indeed when you try to say that getting 8-rides for the same price as 10-rides is "the same ride value."
Wednesday, February 04, 2009
As Obama bestrides the world stage, Canada has nothing to say
Great OpEd on Canada's absent foreign policy.
Here’s a key point:
On the military side, we continue to pull more than our weight in Afghanistan. But who believes Canada will contribute significantly to shaping the future of that benighted country, or its relations with Pakistan - or Pakistan's relations with India, even though millions of South Asians have flocked to our shores?
I take this point even outside of the Afghanistan context. Canada’s immigrant population is a huge and valuable resource. We should be tapping newly arrived and first generation immigrant Canadians to help the country forge stronger political, economic, trade and security ties with their home countries.
And I think the article lets Canadian foreign policy off a little easy. Sure, the musical chairs that is the government has put a strain on trying to develop a coherent long-term foreign policy; but I think the problem is deeper than that. I think there is a fundamental lack of vision on what a Canadian foreign policy should look like.
In a globalized world (and the nature of global intertwined economy could not be more clear as it is now) foreign policy is not just a tool of diplomacy and security. Foreign policy plays a key role in trade and economic growth. A new vision is needed to bring Canada our of its Lester Pearson “we’re the world’s peacekeepers” view on our foreign policy (which was never true anyway) to a more sophisticated vision that encapsulates the complex relation between economics, technology and security.
Here’s a key point:
On the military side, we continue to pull more than our weight in Afghanistan. But who believes Canada will contribute significantly to shaping the future of that benighted country, or its relations with Pakistan - or Pakistan's relations with India, even though millions of South Asians have flocked to our shores?
I take this point even outside of the Afghanistan context. Canada’s immigrant population is a huge and valuable resource. We should be tapping newly arrived and first generation immigrant Canadians to help the country forge stronger political, economic, trade and security ties with their home countries.
And I think the article lets Canadian foreign policy off a little easy. Sure, the musical chairs that is the government has put a strain on trying to develop a coherent long-term foreign policy; but I think the problem is deeper than that. I think there is a fundamental lack of vision on what a Canadian foreign policy should look like.
In a globalized world (and the nature of global intertwined economy could not be more clear as it is now) foreign policy is not just a tool of diplomacy and security. Foreign policy plays a key role in trade and economic growth. A new vision is needed to bring Canada our of its Lester Pearson “we’re the world’s peacekeepers” view on our foreign policy (which was never true anyway) to a more sophisticated vision that encapsulates the complex relation between economics, technology and security.
Friday, January 16, 2009
Canada's old economy vs new economy
Old Economy:
Canada's oil bust | A sticky ending for the tar sands | The Economist
New Economy:
Better Place to create electric car infrastructure in Canada
Oil, of course will come back... this price drop is temporary and as we work through this recession demand and prices will rise; and there will probably be more EV company flame-outs than huge sucesses (although Better Place looks promising).
Don't get me wrong, I have no illusions that Canada's economy will totally evolve from a resource-based one to an R&D-based one (although that would be nice.) But any investment the country makes in bits and bytes is more sustainable, more forward thinking and is more in keeping with developing a 21st century economy than any investment in rocks and trees.
Canada's oil bust | A sticky ending for the tar sands | The Economist
New Economy:
Better Place to create electric car infrastructure in Canada
Oil, of course will come back... this price drop is temporary and as we work through this recession demand and prices will rise; and there will probably be more EV company flame-outs than huge sucesses (although Better Place looks promising).
Don't get me wrong, I have no illusions that Canada's economy will totally evolve from a resource-based one to an R&D-based one (although that would be nice.) But any investment the country makes in bits and bytes is more sustainable, more forward thinking and is more in keeping with developing a 21st century economy than any investment in rocks and trees.
Wednesday, December 17, 2008
The joys of deflation
Last year at this time, I was all bent-out-of-shape on inflation.
This holiday season, however, deflation is the new black. But don't worry, you'll see a rise in real income so even this storm has a silver lining... apparently
I'm still nervous.
This holiday season, however, deflation is the new black. But don't worry, you'll see a rise in real income so even this storm has a silver lining... apparently
I'm still nervous.
Friday, November 21, 2008
Canada escapes recession?
I dunno... sounds liek the old (now defunked) decoupling theory to me.
Here's the logic:
The logic behind Desnoyers's logic is this: Export income in Canada will be cut by the U.S. downturn and a big drop in prices for Canada's resource products.
That's why we're entering a slowdown.
But to have a severe slump with soaring unemployment, we'd also need a swoon in domestic spending by consumers, businesses and governments.
That's not happening.
Domestic demand, which makes up three-quarters or more of Canadian economic activity, is on track to keep growing, thanks to a central bank that has already slashed interest rates and stands ready to cut even more.
OK, but how are we going to fund that three-quarters domestic consumption if there is a drop in demand for Canadian exports, namely our rocks and trees? Please don't tell me we're going to fund this consumption through added debt.
Why Canada looks likely to escape severe recession
Here's the logic:
The logic behind Desnoyers's logic is this: Export income in Canada will be cut by the U.S. downturn and a big drop in prices for Canada's resource products.
That's why we're entering a slowdown.
But to have a severe slump with soaring unemployment, we'd also need a swoon in domestic spending by consumers, businesses and governments.
That's not happening.
Domestic demand, which makes up three-quarters or more of Canadian economic activity, is on track to keep growing, thanks to a central bank that has already slashed interest rates and stands ready to cut even more.
OK, but how are we going to fund that three-quarters domestic consumption if there is a drop in demand for Canadian exports, namely our rocks and trees? Please don't tell me we're going to fund this consumption through added debt.
Why Canada looks likely to escape severe recession
Monday, September 29, 2008
Dani Rodrik's weblog: How to invest in Africa, really quickly
Interesting how different ideas around development are coming to the fore. Here is another DIY microfinance through the Center of International Development at Harvard. Actually, I'm more interested in hearing about their plans for the "Empowerment Lab".
Dani Rodrik's weblog: How to invest in Africa, really quickly
Dani Rodrik's weblog: How to invest in Africa, really quickly
Sunday, September 14, 2008
Canada didn't invest, so now it must pay
Sadly, Canada didn't use the recent good times in commodities to invest in other industries and further diversify its economy. The country remained stuck in its rut of relying on exporting rocks and trees for economic growth. Well, with the global slow-down happening, I'm afraid that party is over (or at least feeling super gross with a wicked hangover).
Canada could have taken its surpluses, its stronger currency and its commodities revenues to make some strategic investments. But it passed on that opportunity and now maybe future opportunities will pass on Canada.
ViewsWire
Canada could have taken its surpluses, its stronger currency and its commodities revenues to make some strategic investments. But it passed on that opportunity and now maybe future opportunities will pass on Canada.
ViewsWire
Thursday, August 28, 2008
Monday, August 04, 2008
Entrepreneurship | Spreading the gospel | Economist.com
Another example of using entrepreneurship and market forces as tools for global development.
I highlight this example and examples such as Digicel not to discredit more traditional forms of development (although those models could use a re-working), but to illustrate that developments needs a portfolio approach.
There is no one model (for-profit or non-profit) that can help raise people out of poverty. Rather it takes the efforts of many different organizations, with different goals and motivations to really raise the lot of the global poor. For too long perhaps we have focused on the non-profit model and it is now clear that some of the most exciting thinking is coming out of the for-profit world.
I highlight this example and examples such as Digicel not to discredit more traditional forms of development (although those models could use a re-working), but to illustrate that developments needs a portfolio approach.
There is no one model (for-profit or non-profit) that can help raise people out of poverty. Rather it takes the efforts of many different organizations, with different goals and motivations to really raise the lot of the global poor. For too long perhaps we have focused on the non-profit model and it is now clear that some of the most exciting thinking is coming out of the for-profit world.
From anti-globalist to globalist cheerleader
I wrote earlier that Brazil's economy has improved because of its anti-globalist nature... meaning that much of Brazil's growth has been powered by its relatively insular market and strong internal consumption.
That may be true of the past, but Brazil needs a strong globalized system in order to grow in the future.
But Brazil’s ethanol-fueled economy may have hit a rough patch. The country’s stock market went into bear territory this week, falling 20 percent from its recent high. The collapse of the Doha world trade round has put the brakes on Brazil becoming a major exporter of agricultural products to the United States market. Meanwhile, a drop in oil and metal prices could send the country’s economy into a tailspin.
Can Brazilian M&A Stay Hot?
All this probably explains why Lula is so keen to restart the failed Doha talks.
That may be true of the past, but Brazil needs a strong globalized system in order to grow in the future.
But Brazil’s ethanol-fueled economy may have hit a rough patch. The country’s stock market went into bear territory this week, falling 20 percent from its recent high. The collapse of the Doha world trade round has put the brakes on Brazil becoming a major exporter of agricultural products to the United States market. Meanwhile, a drop in oil and metal prices could send the country’s economy into a tailspin.
Can Brazilian M&A Stay Hot?
All this probably explains why Lula is so keen to restart the failed Doha talks.
Thursday, July 31, 2008
Brazil: The anti-globalist?
NYTimes has a profile on Brazil today. Probably the most interesting part of the story is about Brazil's self-sufficiency.
Here's the money quote:
“What makes Brazil more resilient is that the rest of the world matters less,” said Don Hanna, the head of emerging market economics at Citibank.
As I've looked at Brazil that has been the one thing that has impressed me the most. The country really has been able to build and grow domestic industries and feed its own growth through internal consumption.
Of course, Brazil hasn't had the GDP growth numbers that other large, more "globalized" emerging markets have demonstrated; Brazil's GDP growth has been in the 4-5% range vs. India's 7% range and China's +9-10% range.
But what it lacks in GDP growth, it makes up in resiliency. It is still a tough story to tell because despite the great social advances as of late in Brazil, it is hard to see how 5% growth will really make a dent in the huge social inequalities in the country.
Here's the money quote:
“What makes Brazil more resilient is that the rest of the world matters less,” said Don Hanna, the head of emerging market economics at Citibank.
As I've looked at Brazil that has been the one thing that has impressed me the most. The country really has been able to build and grow domestic industries and feed its own growth through internal consumption.
Of course, Brazil hasn't had the GDP growth numbers that other large, more "globalized" emerging markets have demonstrated; Brazil's GDP growth has been in the 4-5% range vs. India's 7% range and China's +9-10% range.
But what it lacks in GDP growth, it makes up in resiliency. It is still a tough story to tell because despite the great social advances as of late in Brazil, it is hard to see how 5% growth will really make a dent in the huge social inequalities in the country.
Tuesday, July 29, 2008
Barefisted development
Great story on Digicel, a company that has a very barefisted approach to development and market creation. They (apparently) go into a country, develop their infrastructure and sell mobile phones to the masses, all before the government knows what is going on. The gamble is that when people get their mobiles, they are not willing to give them up without a fight.
Fun business model, but it is perhaps not for the faint at heart.
Babble Rouser - Forbes.com
Fun business model, but it is perhaps not for the faint at heart.
Babble Rouser - Forbes.com
Monday, July 28, 2008
Telecoms in Mexico
More competition is needed in the telecoms market in Mexico.
Telecoms in Mexico | Slim’s pickings | Economist.com
Telecoms in Mexico | Slim’s pickings | Economist.com
Adding the "World" in worldwide web
It is clichéd by now to say that as soon as your company is on the web, it is global. But that is not so as witnessed by the experiences of some major web companies.
The globalization paradox that I love talking about is that in order to be global, you really need to be intensely local. Big web companies are realizing this are starting to localize their offering and event their trademarked look and feel.
Here's a great money quote:
"Creating a national company is like rocket science," said John Strand of Strand Consulting in Denmark. "But creating an international company is like proton physics."
An un-American feel aids expanding US Web firms - Yahoo! News
The globalization paradox that I love talking about is that in order to be global, you really need to be intensely local. Big web companies are realizing this are starting to localize their offering and event their trademarked look and feel.
Here's a great money quote:
"Creating a national company is like rocket science," said John Strand of Strand Consulting in Denmark. "But creating an international company is like proton physics."
An un-American feel aids expanding US Web firms - Yahoo! News
Tuesday, July 15, 2008
Forget growth, forget inflation. The main concern...???
...plain old stability!
I remember the days of "don't worry, it'll be a mild recession" talk of a few months back. Now we're looking down the wrong end of a full on financial crisis.
I'm glad some people still have a "don't worry be happy now is the time to buy attitude" but I remain unconvinced. I thought that a few weeks ago and now feel duly chastened.
I'm not panicking or doing anything rash.
But I'm not happy either.
I remember the days of "don't worry, it'll be a mild recession" talk of a few months back. Now we're looking down the wrong end of a full on financial crisis.
I'm glad some people still have a "don't worry be happy now is the time to buy attitude" but I remain unconvinced. I thought that a few weeks ago and now feel duly chastened.
I'm not panicking or doing anything rash.
But I'm not happy either.
Monday, July 07, 2008
Quietly, Brazil Eclipses an Ally - NYTimes.com
Interesting look at Brazil's rise to become a regional (and global) power.
Quietly, Brazil Eclipses an Ally - NYTimes.com
Quietly, Brazil Eclipses an Ally - NYTimes.com
Why the US auto industry is sinking....
... in a word "innovation" or lack thereof.
Great article in today's NYTimes "Asleep at the spigot" on how US automakers and unions blustered and lobbied politicians and did anything but the right thing, innovate and make cars for the future. Now they are paying the price and are a great cautionary tale for other industries that may become complacent and lazy.
That’s the great thing about economics and markets, eventually it'll trump any sort of backward ideology. For some reason, US carmakers and their supporters thought it was a right to make and sell backward-thinking behemoths, regardless of what was happening in global oil markets. They didn't pay attention to where the auto and fuel markets were going and are now far behind more intelligent competitors that understood the market for how it really is, not for how they can manipulate politicians to say it should be.
Great article in today's NYTimes "Asleep at the spigot" on how US automakers and unions blustered and lobbied politicians and did anything but the right thing, innovate and make cars for the future. Now they are paying the price and are a great cautionary tale for other industries that may become complacent and lazy.
That’s the great thing about economics and markets, eventually it'll trump any sort of backward ideology. For some reason, US carmakers and their supporters thought it was a right to make and sell backward-thinking behemoths, regardless of what was happening in global oil markets. They didn't pay attention to where the auto and fuel markets were going and are now far behind more intelligent competitors that understood the market for how it really is, not for how they can manipulate politicians to say it should be.
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