The Big Board most of the world knows has been reduced to a server farm and a bell.
– Source: Bloomberg
To the above I would add … Everything else is theater.
The bearish stories mount in China. We have the municipal debt debacle, plus continuing signs of troubles in the industrial heart of things:
China’s southeastern Guangdong province, the country’s main export manufacturing hub often referred to as “the factory of the world,” is in danger of losing its economic mojo amid a litany of woes.
Small and midsize manufacturers of clothes and other export goods that have been flooding markets around the world are struggling with rising materials costs, shortages of workers and funds and the upward trend of the Chinese currency, the renminbi or yuan.
Many of these businesses have gone under or cut back on production sharply during the current hard times, which some local business owners say are even harsher than the economic slump triggered by the global financial crisis in 2008.
Gathering economic gloom is fomenting social unrest in this heartland of China’s export-oriented economy, as a recent series of riots in the province show.
From a letter to the editor in the current issue of The Economist on Italy:
SIR – I refer you to some apt lines uttered by Orson Welles in “The Third Man”: “In Italy for 30 years under the Borgias they had warfare, terror, murder, and bloodshed, but they produced Michelangelo, Leonardo da Vinci and the Renaissance. In Switzerland they had brotherly love, they had 500 years of democracy and peace, and what did that produce? The cuckoo clock.”
Recent-ish paper on a favorite subject: vagueness. The authors show that in certain contexts, like weight loss, it is better to know less than more. The fuzzier the information was, the more weight people lost. People with more precise information gained weight.
Is the eternal quest for precise information always worthwhile? Our research suggests that, at times, vagueness has its merits. Previous research has demonstrated that people prefer precise information over vague information because it gives them a sense of security and makes their environments more predictable. However, we show that the fuzzy boundaries afforded by vague information can actually help individuals perform better than can precise information. We document these findings across two laboratory studies and one quasi–field study that involved different performance-related contexts (mental acuity, physical strength, and weight loss). We argue that the malleability of vague information allows people to interpret it in the manner they desire, so that they can generate positive response expectancies and, thereby, perform better. The rigidity of precise information discourages desirable interpretations. Hence, on certain occasions, precise information is not as helpful as vague information in boosting performance.