Speaking at a pensions summit in the Netherlands, Professor Laurence Kotlikoff of Boston University told delegates that the global financial system – which remains largely unreconstructed despite near implosion following the collapse of Lehman Brothers two years ago – is a massive con trick, characterised by lack of transparency, and largely made up of fraudulent guarantees and financial promises that cannot be kept.
The response of the European Union to the unfolding eurozone sovereign debt crisis has, so far, been of the headless chicken variety. Or to put it more politely, it has revolved around treating the symptoms rather than the causes of Europe's closely interwoven sovereign debt and banking crises. Brussels has been sticking the equivalent of Band-Aids on limbs that in fact need much more radical surgery.
What is it about politicians that makes them think we’re all stupid? Is it because we are? I think not, though taken as that pliable mass, “the general public”, we sometimes act as if we were. But the “public” are, hopefully, becoming a lot less lethargic and a lot more interested in holding governments to account.
FairPensions has produced an in-depth report which lifts the lid on the conflicts of interest at the heart of pensions management, and calls on institutional investors to mend their ways by adopting what it calls an “enlightened fiduciary” model. Under the FairPensions proposals, which were launched at an event attended by government minister Ed Vaisey last month, investors would be forced to prioritize the interests of their end users (savers, beneficiaries etc), whose interests they are supposed to represent, rather than just paying lip-service to them.
Everyone complains about corporate politics but, interestingly, it’s rare that anyone admits they participate in them. It’s more of a victim thing. For the most part, that’s correct. There are far more victims than perpetrators of corporate politics. The problem is, the “perps” are too often in the power positions – which leads to a general disempowerment and disengagement of the majority of people.
As the euro sovereign debt crisis continues to gnaw away at market confidence, sometimes fading into the background, sometimes zooming back to centre focus as some funding or political crisis affecting the peripheral countries grabs the headlines, it is worth bearing in mind that all the bailout fund has done so far is to kick the can of a Greek or Irish default further down the road.
This blog was written just hours before the US government was due to find itself in a total stalemate over President Obama’s 2012 Budget. The Republicans, headed by House Budget Committee Chairman Paul Ryan, want to see more than $6 trillion worth of spending cuts over the next 10 years to pull the US fiscal deficit back to something like a manageable number.
It looks like the UK life insurance sector is to be saved from the consequences of its own short-termism thanks to timely re-regulation by the Financial Services Authority. Five years ago I quoted the leading insurance analyst Ned Cazalet as saying that the practice of churning was...
If there is anything surprising about gold moving to new record highs on the back of the unrest in North Africa and fears that the Persian Gulf could get drawn in to the changes sweeping autocrats from power, it is that it has taken this long for gold to surge past the highs it set...
When prime minister Jose Socrates formally requested a bailout for Portugal on April 6, it left just two of the five PIIGS countries standing. While the details of Portugal's expected €80bn facility from the EFSF have yet to be hammered out, it left only Italy and Spain still able to refinance their sovereign debt - albeit with significant support from the ECB - from the markets without external assistance. So which of these two Mediterranean countries is likely to be the next domino to fall?