All about what is happening in the global economy...
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Thanks MadScientist. Basically, from what I understand US is not going to get any better in a long long time because they have spent their future. Hence it is quite a good choice to relocate.
Europe as the financial centre does sound a little strange at this point. -
jeestan:
If I may offer a contrarian view...Thanks MadScientist. Basically, from what I understand US is not going to get any better in a long long time because they have spent their future. Hence it is quite a good choice to relocate.
Europe as the financial centre does sound a little strange at this point.
It is actually a good idea to relocate TO USA. :yikes:
Particularly if one has a very stable job...
Things will be a lot cheaper there... and it is already so. Unlike times where economies are booming, and you want to be where the economies are booming, the coming times would probably be like low growth and high inflation... so, surviving also means to have a low base. To earn less and spend more is devastating... can survive, but devastating. That's how the 30s-40s were like. -
which part of Europe is controlling financial centre being shifted to ?
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phtthp:
which part of Europe is controlling financial centre being shifted to ?
That's a long term hypothesis...
From the looks of it, Germany is a contender for now.
The others are lagging way too far behind... even France. -
MadScientist:
Hmm, your input always makes me think. My sister is in New York, her job is quite stable so far. Now they are not buying, just saving and saving. Why would the coming times be low growth and high inflation? I thought inflation was tied to growth?
If I may offer a contrarian view...jeestan:
Thanks MadScientist. Basically, from what I understand US is not going to get any better in a long long time because they have spent their future. Hence it is quite a good choice to relocate.
Europe as the financial centre does sound a little strange at this point.
It is actually a good idea to relocate TO USA. :yikes:
Particularly if one has a very stable job...
Things will be a lot cheaper there... and it is already so. Unlike times where economies are booming, and you want to be where the economies are booming, the coming times would probably be like low growth and high inflation... so, surviving also means to have a low base. To earn less and spend more is devastating... can survive, but devastating. That's how the 30s-40s were like. -
jeestan:
That IS the idea, isn't it?
Hmm, your input always makes me think. My sister is in New York, her job is quite stable so far. Now they are not buying, just saving and saving. Why would the coming times be low growth and high inflation? I thought inflation was tied to growth?
Gimme a cookie. :boogie:
Yes, I absolutely agree with that thought... I did think so too, until recently (in early 2008).
Low growth and high inflation is called STAGflation.
Globally, we went through one round in the 70s. As your parents, they will remember how it is like. I never got enough of an answer from anyone who lived through that time... and clearly, those in this time, have no idea what it is like.
Look at Greece, if not most of Europe...
They are having low growth now, and inflation will start to creep in, if not already.
SG is a little luckier in Asia... even as Asia is battling huge inflation pressures now (SG CPI in excess of 4%), our growth rate is nothing spectacular to the years of 2004-2007.
Add to that the low interest rate environment, the alleged safe haven status of our SGD (seen after a deleveraging bout usually), the influx of FI (aka hot money) for our economic growth (read GDP growth)... can anyone really say that our inflation is in line with our economic growth? What's more is that there is an increasing disparity with headline inflation rate, and the real inflation rate we experience. Case in point, my wife noticed that our favourite green tea can is now the same price for 315ml, instead of the 330ml we used to get. Check carefully... you will see that there is a 4.5% reduction of volume. Another case in point, the price of basic food like rice, or bread... has escalated more than 10% in the last 2-3 years. For rice, particularly.
Your sister is smart... they need not only to save, but also to grow. The game just got harder, to grow your investments, etc. in an environment of low growth? That's why a lot of money is moving into real assets like physical gold and real estate. The low interest environment is not helping the latter either (in US, it is not spurring sales; in SG, it's the opposite but the statement holds true as well!). -
European worries... and UBS...
Something you might like to know about UBS... The CEO resigned IMMEDIATELY taking responsibility for the rogue trading.
http://www.marketwatch.com/story/ubs-ceo-gruebel-resigns-in-wake-of-rogue-trades-2011-09-24
Bloomberg News
Gruebel Resigns From UBS After $2.3 Billion Trading Loss
Sept. 24 (Bloomberg) -- Oswald Gruebel, chief executive officer of UBS AG since February 2009, resigned his post at Switzerland’s largest bank after a $2.3 billion loss from unauthorized trading.
He will be replaced on an interim basis by Sergio P. Ermotti, the bank’s CEO for Europe, the Middle East and Africa, UBS said in a statement today. Gruebel, 67, leaves after the Zurich-based bank’s board of directors met in Singapore.
Gruebel joined UBS after about 37 years at rival Credit Suisse Group AG and is the only person to have served as CEO of both of the biggest Swiss banks. He returned UBS to profit about six months after arriving, resolved a dispute with the U.S. over banking secrecy that threatened the firm’s existence and stemmed nine straight quarters of client defections at the private bank.
“Oswald Gruebel feels that it is his duty to assume responsibility for the recent unauthorized trading incident,” Chairman Kaspar Villiger said in the statement. “During his tenure, he achieved an impressive turnaround and strengthened UBS fundamentally.”
The board had asked Gruebel to remain until the annual shareholders meeting next year, Villiger said on a conference call with reporters today.
UBS has said it may be unprofitable in the third quarter after last week’s unauthorized trading. The loss, less than two months after Gruebel said the firm had “one of the best” risk- management units in the industry, raised questions about the bank’s controls.
Investment Bank
“They’ve got to change the aspirations of the investment bank and they’ve got to shrink it,” said Peter Thorne, a London-based analyst at Helvea SA. “I presume Gruebel was a bit of an obstruction to that because he felt the world was going back to the good old days and UBS was going to be a powerful investment bank.”
The loss resulted from trading in Standard & Poor’s 500, DAX and EuroStoxx index futures over the past three months, UBS said on Sept. 18. While the positions were taken within the “normal business flow of a large global equity trading house,” the size of the risk was hidden by phony trades, UBS said at the time.
Kweku Adoboli, 31, the UBS trader charged with fraud and false accounting that may have resulted in the loss, remained in custody after a hearing in London on Sept. 22. He has yet to enter a plea.
Succession Plan
“In the future, the investment bank will be less complex, carry less risk and use less capital to produce reliable returns and contribute more optimally to UBS’s overall objectives,” Villiger said today. “The investment bank will continue to strengthen its alignment with UBS’s wealth management businesses.”
The bank will announce further changes to the investment back in a presentation to investors scheduled for Nov. 17, Ermotti said on a conference call with the reporters today.
Gruebel’s departure throws into relief the lack of a succession plan at UBS. Chairman Villiger, 70, is scheduled to step down in 2013 and be replaced by former Bundesbank President Axel Weber, 54, who lacks hands-on experience running a commercial bank. The trading loss also reduces the chance that Carsten Kengeter, the 44-year-old head of the investment bank, will ascend to the top job.
Ermotti
Ermotti, a 51-year-old Swiss national who joined UBS in April after working at Merrill Lynch & Co. and UniCredit SpA, will be interim CEO while the board seeks a permanent successor to Gruebel, the bank said. In his 18 years at Merrill Lynch, Ermotti oversaw businesses including the global equities division before leaving in 2003 to join UniCredit, Italy’s biggest bank.
As UniCredit’s investment banking chief, Ermotti also supervised global transaction and private banking. Ermotti had aimed to compete with the world’s top securities firms as mergers soared and business flourished before the subprime crisis spread and credit became scarce. He later scaled back the plan to focus on corporate and investment banking business in the lender’s home markets.
Ermotti, who became UniCredit’s deputy CEO in July 2007, will be a “permanent candidate” for the top job at UBS, Helvea’s Thorne said.
To contact the reporter on this story: Giles Broom in Geneva at [email protected]
To contact the editor responsible for this story: Frank Connelly in Paris at [email protected]
Find out more about Bloomberg for iPad: http://m.bloomberg.com/ipad/
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My concern is that the exit was very abrupt.
He is a very smart man, aptly put by one of my buddies...
and so when he moves this fast, I cannot help but sense something else more than the rogue trades.
There may be more that meets the eye at this point IMHO... only time will tell.
As for Europe, Paul Krugman is one of the best NYTimes writers...
in his recent article:
http://www.nytimes.com/2011/09/26/opinion/euro-zone-death-trip.html?hp
Cheers! -
MadScientist:
Well, I read quite a bit of Paul Krugman and his pal, Joseph Stiglitz. A bit too leftist for my taste. But his analysis of the Euro (and Europe) is a fair one I believe.
As for Europe, Paul Krugman is one of the best NYTimes writers...
in his recent article:
http://www.nytimes.com/2011/09/26/opinion/euro-zone-death-trip.html?hp
Cheers! -
3Boys:
I have to agree with you on that.
Well, I read quite a bit of Paul Krugman and his pal, Joseph Stiglitz. A bit too leftist for my taste. But his analysis of the Euro (and Europe) is a fair one I believe.MadScientist:
As for Europe, Paul Krugman is one of the best NYTimes writers...
in his recent article:
http://www.nytimes.com/2011/09/26/opinion/euro-zone-death-trip.html?hp
Cheers!
I also like John Mauldin's editorials about Europe. Very comprehensive and easily digestible. -
http://www.washingtonpost.com/business/clsas-napier-recommends-buying-asian-currencies/2011/09/23/gIQAJfWgpK_video.html
One of the best economist/analyst IMHO... one that is about 95% accurate since 2005! He is the authour of Anatomy of a Bear.
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