“We must accept finite disappointment, but must never lose infinite hope.” – Martin Luther King Jr.
Apple makes money – a lot of money! In fact, Apple makes more money than any company has ever made and now finds itself, logically, with mountains of cash. As high as some 200 billion dollars, and more than the US Treasury. Of course, it’s the shareholders who are the ultimate owners of these monumental…
Germany has a huge demographic problem, but not necessarily the one you might suspect. While its population is indeed stable at slightly over 80 million inhabitants, it is the age of the total payroll that threatens to derail the country’s economy. This is because they are dangerously increasing the dependency ratio, that is, the proportion…
Last summer, during a telephone interview with his American counterpart, German Minister for Economic Affairs, Wolfgang Schäuble, thought he was being funny by suggesting that they should swap Puerto Rico (which has nearly gone bankrupt) for Greece! In fact, the overwhelming majority of Germans have been convinced by the narrative which claims that their hard…
The film posted online by Daech on the 1st of September last year lasts nearly an hour and appears in the style of a documentary, shows statistical data and calls upon “experts”. “The rise of the Khalifah and the Return of the Gold Dinar” explains the theological motives which are pushing Islamic State (IS) to…
It is the abundance of cash resources which has propelled financial markets, likewise for all assets in general, since 2009. This gigantic reflation, orchestrated to the sound of 10 to 12 trillion dollars being injected into the system, has been the main and fundamental source, having authorised a global assessment, and even euphoria, since certain…
Capitalism must become the business of everybody again because it is in the hands of a miniscule minority who have taken charge. An imperceptible shift has occurred since the beginning of the ‘80s: the power of money having passed from the hands of the captains of industry to those of high finance. Because of this,…
Might Islamic State (IS) be on the verge of setting up its own bank? It is in fact following the footprints of other terrorist organisations by trying to equip itself with the attributes of a genuine state in order to send the message to its sympathisers outside of Syria and Iraq that it is now…
One after another, every establishment which has the power to print money has joined in on the feast. In the absence of public policies dedicated to openly relaunching growth and battling unemployment, and in the presence of indecisive politicians who are not versed in economics, only central banks have had the ammunition capable of neutralising…
The debacle of oil prices has greatly exceeded that of the global financial crisis of 2008 and the Asian crisis of 1998. And it is much more severe. At the end of this summer of 2015, OPEC is just a shadow of its former self: simply put, it has been de facto dissolved and this…
The severe damage that China is currently suffering is not necessarily what it may appear to be. It’s actually these “zombie” companies that are degrading the economic fabric of the nation; they are the failing businesses that the Chinese government is nevertheless keeping alive on artificial respirators. The easy money and low prices which have…
People instinctively like record breakers: fastest man, tallest building or longest winning streak. Records provide us with a frame of reference and a benchmark by which to judge what has gone before as well as what lies ahead. Records, we are often told, are there to be broken: they can inspire greater performances and…
The meager European economic growth – often described as anemic – stems from a savings glut. Economic stagnation becomes secular from the moment the money stops flowing, that is, once the investor keeps his precious cash in his bank account and that bank is no longer able to recycle it towards productive sectors of the…
Let us be inspired by the British example where, against all expectations, David Cameron was re-elected Prime Minister. He had previously imposed on UK’s citizens and economy a pitiless austerity. But, a few months before the election he authorized a recovery in economic growth. Had he not done so, he would not have been re-elected!…
Humans have always had to work to support themselves. However, in its current form, work is a very recent concept in the course of human history. Until the advent of the tradable joint stock company (Dutch East India Company) towards the end of the Renaissance in 1602, human beings had indeed worked for themselves. Creative…
The cash bonuses, stock options, pensions and mega salaries received by corporate executives are clearly a wealth transfer mechanism. In this regard, the Euro 300,000 annual pension to be paid to Philippe Varin, departing CEO of PSA Peugeot Citroën, pales in comparison to the remuneration of the great American bosses. Does Nicholas Woodman, GoPro founder,…
A debate rages on, mostly in the United States, regarding the secular stagnation of our economies. This secular stagnation is due, in my opinion, to the extraordinary productivity of capitalism. The very low, zero-boundary or even negative interest rates are simply the consequence of capital’s very efficient productivity. As for unemployment, it is itself a…
Money is only a means of payment. Moreover, any vehicle generally accepted as payment for goods and services is by definition comparable to money. This broader definition of money allows us to find several other means of payment in circulation and in use in our societies and economies. Indeed, bank notes and electronic transactions passing…
At the height of the 2008 financial crisis, the U.S. government seriously considered nationalizing a large chunk of the American banking system. Instead, what it did was take effective control of the massive U.S. mortgage market. Without Federal guarantees and full government support, the U.S. real estate market (already under critical pressure from the subprime…
How should we live in a world where interest rates are negative? It is a genuine paradigm shift that tells us to prepare for global deflation. While the U.S. will be spared, our Europe is sinking into economic stagnation, an ice age likely to be secular in nature. Switzerland and Denmark are leading the way…
The time when Voltaire stated in Candide that “Work saves us from three great evils: boredom, vice and need” is over. Today, it is no longer appropriate to work regardless of the cost. In other words, less work could improve our living conditions and could undoubtedly improve the way we do work. The belief that…
Do not be fooled by deflation. It is the decades-old general decline in wages, which inevitably leads to the lowering of consumer prices. And consumer prices will be made to adjust to the deterioration of our standard of living. Deflation is only the natural result of our shrinking purchasing power. Prices collapse for an obvious…
Europe and Switzerland are in full deflation, aggregate demand is at best anemic and only the emergence of a single or multiple asset bubbles is likely to revive their economies. Retail prices decline as consumers, who no longer have the means to maintain their current living standard, refuse to listen to the “credit sirens” and…
The European government elites are sinking into denial. Their frightened posture against public deficits and preference for strict financial orthodoxy is a reflection of an age-old tendency for self-destruction. However, the current version of this tendency is about to lead them to a nasty state of affairs. I am referring to the ascension of extreme-right…
German politicians live and evolve in a parallel universe. Their trade surpluses, their fiscal and restrictive fiscal policies and their anemic domestic investment are all compelling evidence of the “economic autism” of their government elites. Those political leaders incessantly affirm in public the validity of these surpluses as if trying to convince themselves that these…