Category Archives: Regulations

From an industrial renaissance to an economy of value

By Francisco Jaime Quesado – While having to endure the ongoing era of a global pandemic, we are facing the prospect of an effective industrial renaissance that can change the way our economy works

In the new global economy, in which industry is becoming more important, companies have a new challenge – to redefine its value chain and to integrate the existing global networks with new ideas, new solutions and new proposals of competence. This industrial renaissance will be a contract of trust in this new agenda of change and a new effective vision for the future as it should mobilize those that have a set of effective value creations in the economy.

A post-pandemic industrial renaissance is the point of contact between those that believe in the power of people to create new solutions to more complex problems that are arising in society and those that want innovation and creativity to be the platform for the creation of value in a globally competitive economy. This ‘renaissance’ is, in essence, the confirmation of a process of integration of people into society – an individual’s contribution must be a commitment to the organization of society and its main elements.

The next stage in the process of rebirth must apply to the most critical factors of competence and trust, which includes a focus on innovation and the sharing of positive dynamics. We need society to have a new challenge. Society must be able to be the real platform of a more entrepreneurial society that is centered on new areas of knowledge and sectors of value.

In a modern and active society, the keyword is ‘co-creation’, which is used to promote a dynamic and active creation process that involves each citizen in the next big challenge for society. more>

The Texas Power Grid Failure Is a Climate Change Cautionary Tale

By Justin Worland – For scientists, the havoc wreaked by the extreme winter weather that hit Texas in mid-February dropping several inches of snow and leaving millions without power did not come as a surprise. Ten years ago, in 2011, energy regulators warned the state’s electric-grid operators that they were ill-prepared for an unprecedented winter storm. And for decades before that, climate scientists had cautioned that a warming planet would cause climate chaos, raising the average global temperature while driving unusual weather events like this one. For Texas, it was always just a matter of time.

Despite these warnings, the state was unprepared—which Texans realized as soon as the storm swept in. Equipment froze at power plants, leaving about half of the state’s electricity-generating capacity offline. Natural gas wells iced over, slowing the fuel supply that heats homes. Millions were left without electricity, at least one city turned off its water supply, and Harris County, where Houston is located, reported hundreds of cases of carbon monoxide poisoning as Texans turned on their own generators to warm up. “This shows a disastrous level of underpreparation,” says Daniel Cohan, an associate professor of civil and environmental engineering at Rice University in Houston, speaking to TIME shortly after he had lost water pressure. “We knew this weather event was coming … What went wrong?”

The catastrophe can be linked to a string of planning failures that didn’t take that threat seriously. Much of the electricity infrastructure in Texas wasn’t hardened-think of insulation and other protections that allow it to function in extreme winter weather. Several power plants remained offline for scheduled maintenance, ignoring weather forecasters’ warnings of the fast-approaching storm. And the storm disrupted the supply of fuel needed to run other such plants.

The cascade of failures in Texas signals what is perhaps the greatest challenge ahead in this climate-changed world: accepting that business as usual isn’t working. Across the planet, humans have built civilization to withstand the vagaries of a 20th century climate. The extreme weather events of the 21st century will look nothing like those that came before—and hundreds of years of past preparation will not suffice. “The future is not going to be like the past,” says Melissa Finucane, a co-director of the Rand Climate Resilience Center. “If we could just plan a little better, we could anticipate some of these problems.” more>

Updates from Ciena

For years we’ve been hearing that 2020 would be the year that 5G networks would begin to be deployed. Well, it’s finally here, and MNOs are indeed starting to roll out 5G services. But beyond new phones and RAN technology, it’s going to be those that embrace automation who will ultimately drive faster transitions to 5G. To that end, Blue Planet has unveiled new capabilities for 5G automation.
By Kailem Anderson – As we watched the standard come together, 5G set some lofty expectations in terms of performance gains that 5G networks will deliver to users over 4G. These included things like 10 to 100 times faster speeds, 1000 times the bandwidth, support for 10 to 100 times more devices, 99.999% availability, and latency as low as 1 millisecond.

This vastly improved speed, capacity and latency opens up all kinds of new use cases for mobile network operators (MNOs). The increase in users and use cases also means the number of network services connections required of 5G networks is unprecedented and, more importantly, the speed at which these services need to be created and managed, typically in a multi-vendor environment, is significantly faster than what today’s OSS, NMS, and manual processes can handle. This velocity and volume will affect the entire network lifecycle, including planning, designing and deploying services, and day-to-day operations. Automation will play a critical role in helping operators meet these challenges to speed the delivery of 5G networks and derive new revenues.

Finally, with 5G still being an emerging technology, the standards associated with it too are evolving. In order to adhere to the emerging 5G standards, MNOs need a cloud-native 5G solution that is designed and developed based on openness and works in a multi-vendor network with no vendor lock in.

As 5G scales, automation will, in turn, increasingly rely on AI and ML (machine learning) to fully automate some operational processes, including predicting situations like a network fault before it occurs and taking corrective actions before it impacts customers, or understanding when specific network resources are near capacity and scaling them up to meet the growing requirements of the services that rely on them. Of course, this type of AI-assisted operations is a topic I’ve been discussing for quite some time.

The promises of 5G, automation and AI are great, but the path to get there is filled with many technical hurdles. Here on the Blue Planet team, we’ve been working hard to deliver an intelligent 5G automation solution that helps MNOs lessen the bumps. more>

Rapid Money Supply Growth Does Not Cause Inflation

Neither do rapid growth in government debt, declining interest rates, or rapid Increases in a central bank’s balance sheet
By Richard Vague – Monetarist theory, which came to dominate economic thinking in the 1980s and the decades that followed, holds that rapid money supply growth is the cause of inflation. The theory, however, fails an actual test of the available evidence. In our review of 47 countries, generally from 1960 forward, we found that more often than not high inflation does not follow rapid money supply growth, and in contrast to this, high inflation has occurred frequently when it has not been preceded by rapid money supply growth.

The purpose of this paper is to present these findings and solicit feedback on our data, methods, and conclusions.

To analyze the issue, we developed a database of 47 countries that together constitute 91 percent of global GDP and looked at each episode of rapid money supply growth to see if it was followed by high inflation. In the majority of cases, it was not. In fact, the opposite was true—a large percentage of the cases of high inflation were not preceded by high money supply growth. These 47 countries all rank within the top 70 largest economies as measured by GDP and include each of the top 20 countries. If a country was not included, it was because we could not get a complete enough set of historical data on that country.

There are several reasons to want to better understand the causes of inflation. Currently, central banks in Japan, Europe and elsewhere are trying to engender a moderately higher level of inflation in order to stave off the drift toward deflation and under the belief that it will add to job and economic growth. Also, both public and private debt have reached such high levels in ratio to GDP that some policymakers are beginning to reflect on potential paths to deleveraging, and inflation is one such path. Lastly, a number of countries are trying to moderate levels of inflation that are deemed too high. For these countries, too, a deeper understanding of the mechanisms of inflation is important. more>

Updates from McKinsey

How capital markets keep us connected
Nasdaq’s 50th anniversary reminds us that markets should be more inclusive, share more information, inspire innovation, and bring the world together.
By Tim Koller – Fifty years ago this February 8, a UNIVAC 1108 mainframe computer blinked on in sleepy Trumbull, Connecticut. Thus was born the National Association of Securities Dealers Automated Quotation system, or Nasdaq, the world’s first all-electronic stock exchange, where securities could be bought and sold online in real time.

Well, almost.

While the network did flash “bids” and “asks” of prices, users could not actually buy or sell through their computers. Instead, dealers sat before individual Nasdaq terminals and made their trades by telephone—as they would for the next 13 years. The Nasdaq came into being not as a platform for execution but as a source of information and innovation to help facilitate trades by participants across distant locations.

In that way, Nasdaq took its cues from the first modern stock market, the Amsterdam Stock Exchange (now known as Euronext). It didn’t convene at a single or set address during its early years, nor did it actually sell stock certificates, at least in present-day terms. Founded in 1602, the Amsterdam Stock Exchange arose initially as a means for people to subscribe to, and then to sell, percentages of Dutch East India Company net profits. The selling and reselling of these interests, in an iterative series of individual, bargained-for trades, aggregated into “the market.” Trades took place wherever merchants happened to meet, at any hour of the day.

As trading proliferated, the imperative for information did, too. Prices weren’t imposed by fiat; they couldn’t be. Why part from your money or your shares if you didn’t believe you would come out ahead in the bargain? Within a few decades of its founding, the Amsterdam Stock Exchange included trades by forward contracts (already well in use in Europe and around the world for commodities transactions), selling securities short and even buying on margin. Investors understood that the value of their trade relied on the probability of future profits, which meant that the advantage tilted to the diligent, the perceptive, and the informed.

Early stock market investors (there were more than a thousand of them, right from the start) were eager to subscribe when the Dutch East India Company “went public” because, as merchants and traders themselves, they could perceive the potential for high returns. It wasn’t unusual for ships sailing back from East India to realize profits of 100-fold. It also wasn’t unusual for profits to be zero; when fleets set out from Amsterdam, Delft, Rotterdam, and Zeeland, all might be lost to weather, pirates, or scurvy. That vessels did manage to travel the thousands of miles and back was a triumph of innovation and risk taking. Pooling investments and sailing multiple times allowed more investors to create wealth. It also helped protect against losing everything in a single, misbegotten voyage. 1

Soon, stock exchanges were forming or emerging out of existing bourses across the Atlantic and Mediterranean. The more people the better. Larger markets meant greater liquidity, the opportunity to sell and resell equity interests to an ever-growing pool of investors. More markets also meant more opportunity to be closer to the action, as shipping, trade, and commerce brought continents and cultures together. more>

Updates ITU

Beyond 5G: What’s next for IMT?
ITU – The ITU Radiocommunication Sector (ITU-R) has recently published Recommendation ITU-R M.2150 titled ‘Detailed specifications of the radio interfaces of IMT-2020’.

Following the evaluation of various radio technology candidates for IMT-2020 at the end of last year, the newly published Recommendation represents a set of terrestrial radio interface specifications which have been combined into a single document.

The development and approval of this international mobile technology (IMT) standard will support several use cases that leverage the advantages of 5G.

For instance, it will contribute, amongst many other things, to accelerating the response time of autonomous vehicles and enable new and more realistic augmented/virtual reality (AR/VR) experiences.

Understanding the IMT process

A solid grasp of the IMT process is key to understand the significance of the latest 5G developments at ITU. The process consists of 4 main phases:

1. “ITU-R Vision” and definitions
2. Minimum requirements and evaluation criteria
3. Invitation for proposals, evaluation, and consensus building
4. Specification, approval, and implementation

Note: The results of these procedural steps are documented in ITU-R Recommendations and ITU-R Reports. more>

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Updates from Chicago Booth

How central bankers misjudge forward guidance
By Rose Jacobs – One of the best ways to spur an economy is to get people spending, and policy makers have a number of tools to do that. Yet growing evidence suggests a favored approach of late—forward guidance by central banks—doesn’t work. Such guidance, usually focusing on the outlook for interest rates, is meant to make clear to consumers that prices are likely to rise soon, so buying big items now would be smart.

While people may agree with the buy-now logic, they still may not react as economists and policy makers expect, according to Boston College’s Francesco D’Acunto, Karlsruhe Institute of Technology’s Daniel Hoang, and Chicago Booth’s Michael Weber. That’s because they don’t understand the signal, the researchers find.

“If you’re an economist too much stuck in your model world, this is very surprising to you,” Weber says. On the other hand, he acknowledges that not everyone can follow the logic chain that leads from a central banker predicting depressed interest rates, to lower borrowing costs, to higher inflation, to the urgency of buying now. “If you’re not too detached from reality, it’s not surprising,” Weber says.

The researchers analyzed two events in which governments or central banks signaled that prices were set to rise. One was a 2005 announcement by the German government that the country’s value-added tax (similar to the US sales tax) would increase from 16 percent to 19 percent in 2007. The second was a 2013 statement by then European Central Bank president Mario Draghi that interest rates would stay low or decline further for some time. To economists, this statement was a clear signal that price inflation would soon follow. more>

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The rule of law: a simple phrase with exacting demands

If the finger is to be pointed—rightly—at Hungary and Poland, then the EU must insist on compliance by all with universal norms.
By Albena Azmanova and Kalypso Nicolaidis – That the European Union, in its moment of public healthcare emergency and acute economic plight, should find itself paralysed over such a seemingly abstract matter as the rule of law is one of the great paradoxes of our times. And yet this is exactly the conundrum plaguing approval of the EU’s seven-year budget and recovery fund, totaling €1.81 trillion, which Poland and Hungary have been blocking over rule-of-law conditionality for the funds’ disbursement.

Respect for the rule of law is one of those self-evident truths—the absolute minimum requirement of decent political rule—which should be unproblematic in the family of liberal democracies that is the EU. It is equally beyond doubt that the prompt approval of the pandemic recovery fund is in everyone’s interest.

Many commentators assert that the EU should stand up to the defiant governments, in the name of its fundamental values. We do too. But our hope is that we, in Europe, can use this moment as an opportunity to question ourselves further.

Most of us may believe that the arguments put forward to resist rule-of-law conditionality are disingenuous. And they are. But we must still take them seriously when they are presented in line with … the rule of law.

Hungary and Poland are claiming that, by being poorly defined, the rule-of-law principle opens the door to discretionary decisions and thus to the abuse of power.

The rule of law as a political principle and legal norm was indeed born of the ambition to constrain the arbitrary power of central authority. This was why the English barons forced King John to adopt the royal charter of rights, the Magna Carta, on June 15th 1215. The specification of basic freedoms, codified not as privileges for a handful of aristocrats but as abstract and unconditional rights, was meant to ensure that no authority could place itself above these rights in pursuit of its political ends

It is true that the EU should make no compromises with the very foundation of the liberal political order. But the EU itself has complied with these principles erratically and selectively, thus violating the spirit of the rule of law.

This has been evident in several instances—from lack of concern with the Silvio Berlusconi media monopoly in Italy to France’s semi-permanent state of emergency, Malta’s and Slovakia’s complacency with political murder and the Spanish government’s response to the 2017 independence referendum in Catalonia. Often, the EU is content with narrowly reducing the remit of the rule of law to a simple matter of legality—ignoring routine violations of core values, such as the right to peaceful assembly, freedom of speech or even the right to liberty and life itself.

Has the EU not thereby set itself up for the current crisis, supplying the ammunition for autocrats to try to absolve themselves from compliance with the rule of law? more>

How to Build Better Sidewalk Connectivity

TI is working to improve near the sidewalk edge connectivity for household wireless devices.
By John Blyler – Late last year, Amazon announced their “Sidewalk,” a neighborhood network designed to help customer devices work better both at home and beyond the front door. A little less than a year later, the company announced additional details on the Amazon Sidewalk, which highlighted the low-power, long-range connectivity benefits for IoT devices. For anyone who has attempted to install a smart security camera or a connected doorbell at the edge of their Wi-Fi connectivity range, this announcement came as a welcome respite from the difficulties in getting IoT devices to connect and stay connected.

Texas Instruments (TI) is among the chipmakers working with Amazon to make Sidewalk a reality. When TI announced its support for Amazon Sidewalk, it highlighted several low-power, multi-band devices that enabled developers to build applications that leveraged the Sidewalk protocol as well as Bluetooth Low Energy.

To learn more about these multi-band wireless devices and how they support the Sidewalk, Design News talked with Casey O’Grady, marketing manager at Texas Instruments. She focuses on removing barriers for the global deployment of Sub-1 GHz connectivity to achieve greater distances with ultra-low power.

O’Grady: Amazon Sidewalk can extend the range of low-bandwidth devices and make it simpler and more convenient for consumers to connect. Ultimately, it will bring more connected devices together into an ecosystem where products such as lights and locks can all communicate on the same network. Sidewalk can enable devices connected inside the home to effortlessly expand throughout the neighborhood. more>

The EU’s credibility is at stake

By Otmar Lahodynsky – In July, after a four-day marathon summit in Brussels, there was agreement on the EU budget for 2021-2027 and a recovery fund for the EU’s 27 members following the COVID-19 crisis.

Together, almost €2 trillion have been reserved for this purpose. The €750 billion corona aid package is intended to help those countries that have been the most affected by the disease, including as Italy, Spain and France, but also the other Member States as they will need to rebuild their economies.

At the EU summit, a typical Brussels-style compromise was reached – each head of government presented themself as a winner at home if they will receive a lot of money for economic recovery. It was then that the so-called “frugal four” – Denmark, the Netherlands, Austria and Sweden (plus Finland) – forced a reduction in the number of grants in exchange for an increase in the share of loans and a cut in their membership fees. The heads of Poland and Hungary also celebrated at home after the successfully de-linked their access to EU funding from their records on the rule of law.

Subsequently, however, the other EU states introduced this clause by a clear majority.

The Poles and Hungarians felt pressured and they vetoed the seven-year EU budget, which requires unanimity despite the fact that they were not bothered that they had previously approved it.

In his explanatory statement, Polish Prime Minister Mateusz Morawiecki railed against an “attack on Polish sovereignty” and adding that the EU was no longer the same as when Poland had joined the bloc in 2004, a generation after the end of Communism. Morawiecki said the Polish economy was so strong that it no longer needed any subsidies from Brussels (more than €12 billion each year). Morawiecki said that Poles were even considering an EU withdrawal along the lines of Brexit.

Hungarian Prime Minister Viktor Orban, Brussels’ bête noire, went even further. In his view, the EU is acting like the Soviet Union once did. It wants to blackmail Hungary and force it to accept Middle Eastern refugees. In the future, Orban added, the European Commission would have the power to meddle in the internal politics of all of the Member States, as it sees fit. Orban also emphasized that the EU’s previous accusations against Hungary were all unfounded and that the concept of the rule of law was not precisely or universally defined.

The reality is that these core concepts of the bloc were long-ago enshrined in the EU treaties and in Europe’s charter of fundamental rights. Conditions for EU accession were already laid down in the 1993 Copenhagen criteria and include the stability of institutions, democracy, the rule of law, respect for human rights and respect and protection of minorities.

The Commission has, for too long, turned a blind eye to the transgressions of the nationalistic populists in Poland, Hungary and other Eastern European countries. The isolated attempts to bring about punitive proceedings under Article 7 of the EU Treaty did not act as a deterrent, because sanctions were not imposed. For this reason, the governments of Hungary and Poland mutually helped each other.

But now the basic principles of the EU, above all the rule of law, are being put to the test. more>