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25/02/2018

Toma nota.../Take note...

ANGOLA: Un nuevo presidente reformador sorprende al mundo con un giro hacia la democracia

  • Gerardo E. Martínez-Solanas
  • Visto: 9

Nadie creyó al nuevo Presidente de Angola, João Lourenço, cuando prometió reformas exhaustivas. ... Todos los funcionarios habían sido nombrados por su predecesor José Eduardo dos Santos, quien usó nepotismo y patrocinio para perpetuar su poder como heredero de la intervención militar cubana en Angola. Pero Lourenço, el hombre que alguna vez se consideró un títere del antiguo régimen, ha resultado ser tan bueno como su palabra. Entre otras importantes decisiones y reformas impulsadas desde que asumió el poder, Lourenço despidió a la hija del ex Presidente, Isabel dos Santos, del liderazgo de la empresa petrolera estatal Sonangol. ¿Estará abriendo camino hacia la democracia en Angola? En los próximos meses lo comprobaremos.

Cayó la mujer más rica de África

Isabel dos Santos Lisboa (Uypress/Daniel Toledo).– El despido de Isabel dos Santos de la petrolera angoleña Sonangol pone fin a la etapa más próspera y corrupta de la historia del país.
El recién elegido presidente de Angola, João Lourenço, se ha atrevido a hacer el movimiento que muchos esperaban y unos pocos temían: ha apartado de la presidencia de la petrolera estatal Sonangol a la todopoderosa Isabel dos Santos, hija del expresidente Eduardo dos Santos, en el poder durante 38 años, hasta el pasado 26 de septiembre.

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US recession or expansion - What is next?

  • Democracia Participativa
  • Visto: 92

When the US economy is healthy, the stock market happily rises, but it often happens that wistful speculation makes it rise faster than the economy as a whole, thus creating a baloon that must explode sooner or later. If the economy is still healthy, such an "explosion" is called a "correction". This latest "correction" is in percentage points much smaller than previous ones falling into severe recessions, such as the one in 1978 or the other starting in 2008. The balloon usually explodes when something happens creating uncertainty. In this case there were two major worrying events for investors: the collapse of Wells Fargo's stock and the selection of a new Federal Reserve chairman. Investors worried about a major bank default and a significant raise of interest rates by the new chair. Both events happened simultaneously and provoked a small stampede, but far from starting a new recession at a point when corporations, investors and capitals are returning to the US enticed by President Trump's tax reform. The following article has a different, but interesting perspective.

America’s extraordinary economic gamble

  • Fiscal policy is adding to demand even as the economy is running hot.
  • Just when volatility returns to the markets and inflation replaces stagnation as investors’ biggest fear, the United States is adding a hefty fiscal boost—through tax cuts and, if it holds, this week’s budget deal in Congress. It is going to be a wild ride. 

Washington DC, Feb.8.– Volatility is back. A long spell of calm, in which America’s stockmarket rose steadily without a big sell-off, ended abruptly this week. The catalyst was a report released on February 2nd showing that wage growth in America had accelerated. The S&P 500 fell by a bit that day, and by a lot on the next trading day. The Vix, an index that reflects how changeable investors expect equity markets to be, spiked from a sleepy 14 at the start of the month to an alarmed 37. In other parts of the world nerves frayed.

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Wells Fargo triggers US stock market fall

  • Gerardo E. Martínez-Solanas
  • Visto: 155
The Dow Jones Industrial Average has closed down by 1,175 points in the biggest one day fall since the financial crisis.

Federal Reserve sanctions against Wells Fargo may have triggered the fall. Regulators are requiring a shakeup among the bank's board members, and are limiting assets to no higher than end-of-2017 levels. → read more 

Should people keep riding the market and holding at what has been winning, or should they bet on recent losers — a variation on the long-running Dogs of the Dow strategy, which holds that betting on a diversified set of recent blue-chip losers is a path to future outperformance.

According to historic records, the winning approach is to focus on sub-industries that have done the best and the worst in the run-up preceding the correction. There are 145 sub-industries represented in the S&P 500, and it may be advisable to pick the highest-rated company in each of the 10 best and 10 worst sub-industries on CFRA’s rating scale. That will lead an investor to about 20 stocks to choose from. Since 1991, following this strategy every year has produced 13.6% annualized returns, beating the market by 5.5 percentage points, and topping the S&P 500’s price gain 70% of the time. If history is any guide investors have done better buying both last year's 10 best and 10 worst groups. The following article gives a perspective of what is happening now.

Dow Jones hit by worst fall since 2008

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US budgetary decisions that go under the rug

  • Gerardo E. Martínez-Solanas
  • Visto: 129

The US Congress could save between 50 and 100 billion dollars by eliminating bad or inefficient government programs. But even an aggresive President like Donald Trump has not succeeded in his announced project to eliminate a range of non-defense programs that the government should not be running, that it runs poorly, or that may be harmful to individuals and society. Vested interest in the US Congress, mainly among Democrats, block most proposals that ultimately go down the drain under the threat to paralize government if the budget is not approved in time. One of them is the Transportation Security Administration (TSA), whose demise is argued in the following article.

The TSA is a waste of money that doesn't save lives and might actually cost them.

  • The solution is clear: Airports should kick out the TSA, hire (well-paid and unionized) private screeners, and simply ask people to go through normal metal Huge bottlenecks at airportsdetectors with their shoes on.

Few post-9/11 security measures have proven as enduring as the creation of the Transportation Security Administration, which effectively nationalized airport security and dramatically increased screening procedures on flights. In a matter of months, flights went from something you could arrive 30 minutes to an hour beforehand and be fine to something you needed to budget two hours for, what with the shoe removal and the liquids and the possibility of a random pat-down.

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The €uro as the indispensable European building block

  • Gerardo E. Martínez-Solanas
  • Visto: 133

The European Union has 28 member countries and the €urozone counts 19 of them. Denmark, Sweden and the United Kingdom are among the most important member countries not participating in the single currency, in addition to six other new European Union members who still have to prove that they have taken measures for an ireversible progress toward a functioning free-market and competitive economy and some other requirements to build a lasting macro-economic stability. Within this continental stage, the €uro could have become the currency to consolidate the European Union, turning into a real international reserve currency if the European countries had followed in good faith the progressive course towards a stable Confederation of Nations, but the rejection by 2 of the 28 Union members of the draft Constitution previously approved by the other 26, which could have opened the way toward continental stability, served as fertilizer to the seed of discord. As anyone might expect, a common currency is unsustainable buffeted by a multitude of countries stubbornly clinging to independent monetary and fiscal policies. 

As it is highlighted in the following article, Europe is trying that the puzzle does not disassemble, but if the monetary union collapsed, the project of a United Europe will be dismantled from its own base.

Why the euro was created

by Michael Maibach

There are three reasons the euro was created. First, the euro aimed to deepen the EU single market by eliminating currency exchanges across national borders and creating transnational cost competition. Second, the currency was meant to become an alternative reserve currency to the U.S. dollar. And third, it could set the stage for a unified European superstate. Ironically, the euro has rapidly become a central cause of EU disunity.

While the euro is a single currency, the eurozone has 19 separate parliaments, heads of state, and national banks. These national banks, plus the European Central Bank (ECB), make up the Eurosystem – akin to the U.S. Federal Reserve system. As you might imagine, one airplane and 19 pilots is a formula for an economic plane crash. 

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