A growing chorus of experts argue that they’re strangling the economy—and must be stopped.
By Frank Partnoy – Index funds have grown exponentially since John Bogle founded Vanguard in the mid-1970s.
The top three families of index funds each manage trillions of dollars, collectively holding 15 to 20 percent of all the stock of major U.S. corporations. Best of all for their investors, index funds have consistently beaten the performance of stock-pickers and actively managed funds, whose higher fees may support the Manhattan lifestyle of many bankers, but turn out not to deliver much to customers.
Concerns about the potential dangers of shareholder diversification first surfaced back in 1984, not long after index funds themselves did. Julio Rotemberg, then a newly minted economist from Princeton, posited that “firms, acting in the interest of their shareholders,” might “tend to act collusively when their shareholders have diversified portfolios.” The idea, which Rotemberg explored in a working paper, was that if investors own a slice of every firm, they will make more money if firms compete less and collectively raise prices, at the expense of consumers. Knowing this, the firms’ managers will de-emphasize competition and behave more cooperatively with one another. more> https://goo.gl/AWXivG
Posted in Banking, CONGRESS WATCH, Economy, Education, History, Media, Net
Tagged Capital, Financial crisis, Government, index funds, Industrial economy, Regulations, United States
Sea Change: GE’s French Wind Turbine Factory Will Power Germany’s Renewables Revolution
By Tomas Kellner – GE is a relative newcomer to offshore wind. The company explored the field a decade ago and returned to the industry in 2015, when it acquired the energy assets of Alstom, and built its first wind farm in Long Island Sound near Block Island, Rhode Island, last year. As the inaugural offshore wind farm in the United States, the project made a splash even though it holds just five turbines. But Merkur, which will have 66 turbines, is a much bigger beast. “This one is special,” says Pascal Girault, who runs the Saint-Nazaire plant. “Everything is big.”
Girault spent the early part of his career managing supply chains for the car industry, but ramping up production for Merkur is no Sunday drive. Workers in Saint-Nazaire make generators and assemble nacelles for the 6-megawatt GE Haliade turbine. The nacelle is the casing on top of the tower that shelters the generator and other equipment. It includes some 30,000 components.
Adding to the task’s complexity, the composite blades for the machines’ 150-meter-diameter rotors come from GE’s LM Wind Power factory in Spain. The steel segments for the tower are being made in Germany and China. U.S. and European companies supply electronics and mechanical components for the converter and generator. “The scale and the speed of the project are challenging,” Girault says. more> https://goo.gl/GSScqV
Posted in Construction, EARTH WATCH, Economic development, Economy, Energy, Nature, Product, Technology
Tagged Business improvement, GE, Industrial economy, Manufacturing, Technology, Wind turbine
Autodesk Highlights Next-Gen Storytelling & Collaboration Tools at SIGGRAPH 2017
Autodesk – Leading up to SIGGRAPH 2017, Autodesk released a series of updates for its media and entertainment tools, including Autodesk Media & Entertainment Collection, Autodesk Maya, Shotgun, Arnold, Autodesk 3ds Max, and Autodesk Flame. Engineered to streamline and accelerate production on films, TV shows, games and immersive experiences, the new releases include improvements and user-requested enhancements that connect creative workflows and teams, helping them bring engaging stories to life for a worldwide audience.
“The continued growth of AR and VR and steady flow of new productions from Netflix, Amazon and others, mean animation and VFX houses are in more demand than ever. We’re focused on helping our customers create, connect and compute faster and more efficiently so they can balance their increasing project loads with tighter schedules and budgets,” Chris Bradshaw, Senior Vice President, Media & Entertainment, Autodesk, stated. “Everything we’re showing at SIGGRAPH streamlines production and equips artists with the tools to handle nearly any creative scenario.” more> cadinnovation.com
Posted in Broadband, Business, Economic development, Economy, Education, How to, Media, Net, Technology
Tagged Autodesk, Broadband, Industrial economy, Internet, Jobs, Skills
By Joseph P. Williams – The willingness to buck convention, smash important precedents and use Twitter like a shotgun has historians and analysts considering whether the impulsive CEO president, unbound by political customs and arguably unaware of limits to his authority, has redefined the office for his successor while tailoring it for himself.
“Trump was elected to blow up the office,” says Jeremi Suri, a historian and scholar at The University of Texas-Austin. Mission accomplished, Suri says – but at a price, for the Republican Party, the president’s own legacy and perhaps American democracy.
“You’re going to see something about presidential reforms coming out of this horrible period we’re in right now,” Suri says. Trump, he says, has destroyed “the myth of a true government outsider” running the country, and likely has paved the way for an experienced outsider, like a governor or low-profile congress member, to take his place.
In the next election cycle, “we’re likely to see a full sweep – a new Congress intent on curbing presidential power and recalibrating the checks and balances.”
“The Trump style of the presidency has only resonated with about 30 to 35 percent of the public,” says Jonathan Turley, who notes that a president’s public-approval rating is directly proportional to his or her leverage with Congress. That means Trump is operating at a power deficit, he adds, and therefore “I’m not sure that future presidents would view this administration as a model to replicate.” more> https://goo.gl/Dv7Dwn
By Basil Oberholzer – Two main problems arise from the connections between monetary policy, financial markets and the oil market: the first is financial and economic instability caused by oil price volatility. The second is an environmental problem: a lower oil price inevitably means more oil consumption. This is a threat to the world climate.
Is there a joint answer to these problems? There is. While hitherto existing policy propositions like futures market regulation or a tax on fossil energy face some advantages and disadvantages, they are not able to deal with both the economic instability and the environmental problem at the same time. What is proposed here is a combination of monetary and fiscal policy. Let’s call it the oil price targeting system.
First, to achieve economic stability in the oil market, a stable oil price is needed. Second, to reduce oil consumption, the oil price should be increasing. So, let us imagine that the oil price moves on a stable and continuously rising path in order to fulfill both conditions. To implement this, the oil price has to be determined exogenously. Due to price exogeneity, speculative attacks cannot have any influence on the price and bubbles cannot emerge anymore. The oil price target can be realized by monetary policy by means of purchases and sales of oil futures. Since the central bank has unlimited power to exert demand in the market, it can basically move the oil price wherever it wants. more> https://goo.gl/eUh85j
Posted in Banking, Book review, Business, Economic development, Economy, Energy & emissions, History, Leadership, Media, Transportation
Tagged Climate change, Financial crisis, Industrial economy, Monetary policy, Oil price
Deschooling Society, Author: Ivan Illich.
By Kerry McDonald – Until we separate public education from public schooling–to truly “de-school” our perspective on learning–we will be mired in a debate about reforming one, singular method of education (that is, mass schooling), while ignoring other methods of education that could be better.
The industrial model upon which compulsory public schooling was founded in 1852 is no longer relevant in a new economy that increasingly values creativity over conformity, knowledge workers over factory laborers. Despite the fact that sociologists and economists believe we have left the Industrial Age for the Imagination Age—an era defined by creativity and innovation and technological application—American education is stuck with an outdated system of mass schooling. Instead of adapting to the changing needs of a creative culture, American schooling has sought to become even more restrictive and entrenched. We need a new model of learning, separate from our modern experiment with mass schooling, that taps into the innate, self-educative capacity of humans.
A perfect example of educational webs, as opposed to funnels like school, is the public library. Libraries are ideal examples of existing, taxpayer-funded, community-based, non-coercive learning hubs. They are openly accessible to all members of a community and, unlike public schools, do not segregate by age or ability. They offer classes, lectures, cultural events, ESL lessons, computer courses, mentoring opportunities and a whole host of other public programming. They are brimming with gifted facilitators who love “learning, sharing, and caring” and who are eager to help guide community learning. more> https://goo.gl/heaclm
Leaner Than Lean: How Digitalization Transforms Manufacturing
By Randy Stearns – If you want to see the future of manufacturing, follow the Tama River about 45 kilometers upstream from Tokyo’s Haneda Airport to the GE Healthcare facility in Hino, Japan. Inside this outwardly conventional, low-rise suburban business complex is emerging the blueprint for the future of manufacturing, tweak by painstaking tweak.
The Hino factory makes both parts for large medical scanners and small, precision equipment. Compared with similar facilities, its production lines are exceptionally efficient — fast, with less waste, errors and unplanned downtime — thanks in part to the successful integration of advanced digital information technology with operational systems. GE calls this convergence of hardware and software on the shop floor the brilliant factory.
The Hino plant is where the Industrial Internet meets Kaizen, the Japanese concept of continuous improvement pioneered by Toyota after World War II that undergirds Lean methods for eliminating waste in manufacturing. more> https://goo.gl/euCTYE
Posted in Broadband, Economic development, Economy, Education, Science, Technology
Tagged Business improvement, Digitization, GE, Industrial economy, Manufacturing, Productivity, Super regions, Technology