Entries Tagged 'Economics and Investing' ↓

The End of National Economies?

I believe one of the biggest things that will occur in this century is the diminution of theories of national economics.

Instead, there will be an increasing need over the century for a new field of global economics. Along with theory, will come a demand for international agencies to exercise more and more coordination among national economies in order to serve the interests of all countries.

Yes, perhaps we’ll be heading for a global Federation of Planets as portrayed on the 20th century Star Trek TV series.

What’s happening in Greece and Argentina right now suggests that this should happen—sooner rather than later. Each of these countries is in conflict with the national law of a foreign country. Greece is in conflict with German law; Argentina with US law. Continue reading →

Greece: Europe’s Identified Patient

Reprinted from Huffington Post

The German government s determined not to negotiate anew the terms for the expiring 712 billion Euro bailout of Greece.

I have three objections to the German line of “reasoning” about Greek debt.

(1) “Charitable” giving that was really out of self-interest 

Here’s what Martin Wolf, well-known British economist and writer for the Financial Times had to say about self-interest and loans  in June, 2011 in his editorial, “Time for common sense on Greece”. Continue reading →

Greece – Who Really Should Pay?

Reprinted from Huffington Post

This time around, it’s Greeks who should beware of foreigners bearing gifts…

Ever since the financial crisis of 2008 hit Greece, I’ve wondered who really should pay.

Today, trying to find a reason for my unease with what’s happening to the Greek people, I took a look at the definitions of two forms of risk that investors can incur when buying foreign debt: Systemic Risk and Sovereign Risk.

Systemic Risk

Systemic risk is a term that came up quite frequently during the global Financial Crisis of 2008. I could never quite figure out what the term meant just by reading about systemic risk as part of a larger context in news stories.

Recently, however, I saw that familiar term used in relation to medical treatments. What I read was that chemotherapy imposes a systemic risk on the body while surgery and radiation treatments for cancer are more targeted risks to the patient.

In regard to investing, Wikipedia says, “In finance, systemic risk is the risk of collapse of an entire financial system or entire market”

We all know, or think we know, what an entire body is, but what is meant by “an entire market”? Continue reading →