Posts Tagged ‘michael baxter’

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In their new book entitled iDisrupted by John Straw and Michael Baxter, the two co-authors claim that only 19 of the world’s 100 largest companies in 2012 will still be in that list in 2042. However, it says that even this bold claim may be understating how things will pan out.

Throughout history, new technologies have had a disruptive effect on businesses and the economy, proving fatal to some well-known companies. In the new book, iDisrupted, the authors claim that the rate of fatality is set to increase.

Of the top 100 global companies identified in 1912, 29 companies had experienced bankruptcy or similar; and 48 had disappeared by 1995. Eastman Kodak was one of just 19 companies that stayed in the list during these years, yet at the start of the 21st century, with the onset of digital cameras, home printing and photo sharing websites, it too fell victim to the rise of new technologies.

In iDisrupted, co-authors John Straw and Michael Baxter claim that many of the industries we currently see as strong, such as oil, car manufacturers, banks and energy companies, could also be heading for the corporate graveyard within the next few decades.  They say that only 19 of the world’s 100 largest companies in 2012 will be in that list in 2042. However, even this may be an understatement.

Straw states: “The big corporate success story of the 20 century related to oil companies, but  just because they flourished in the 20th century, this does not necessarily mean they will flourish in the 21st century.” The rise in electric cars, self-driving cars and advances in solar power and energy storage, will all play a part in the energy industry as we currently understand it

Baxter, aka The Money Spy adds: “In our book, we try to explain why it is that technology is set to change the world like it has never been changed before. This is exciting, but it is also scary. There will be winners and losers, and some of the world’s largest companies will be amongst the losers.”

iDisrupted is a book about disruptive technology, how it will affect business, jobs, the economy and even what it is to be human.

iDisrupted –  Disruptive technology: changing the human race forever – will be available in all good bookshops and online from November 2014 or visit www.idisrupted.com for more details.

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A new book entitled iDisrupted: Disruptive technology, changing the human race forever looks at how technology will change the economy, business and even the human race. One of the technologies it cites that will have a huge impact on the world is Virtual Reality. Despite it first appearing in the 1980s, we are now on the cusp of seeing Virtual Reality’s existence and use in our daily lives in a way that will change us forever.

Hype has been building about Virtual Reality since its conception, but with high prices, small screens, cumbersome technology, and initial disappointment in the technology, many individuals have had their doubts about its impact. However, a new book written by John Straw and Michael Baxter, iDisrupted claims that, thanks to recent evolution in this technology, we will soon be holding face-to-face meetings in Virtual Reality as well as viewing holiday destinations, carrying out online shopping, and watching movies, and of course playing video games.

Combine the improvements in video, sound and computer graphics  with other advances, such as Leap Motion, which enables users to control their computers by the wave of their hand, with technologies that can fool our brains into perceiving smell, touch and taste, and the original dream of Virtual Reality is set to become reality.

Co-author Baxter, aka The Money Spy, says: “In our view, there are three stages in the story of new technology and how it is received by the market. There is the hype phase, the sceptical phase (as we react to what appear to have been unrealistic promises of the previous phase), and then the transformational phase, as previous innovations converge, create wealth, and – in the case of the period we are set to enter – lead to an acceleration in innovation. We are poised to enter the greatest transformational phase ever.”

John Straw added: “With the massive changes in technology that are about to occur, iDisrupted is a book that seeks to open a debate on what is surely the most important topic of the age, but which is barely discussed. Technology threatens society, but could be hugely beneficial. It is time we laid down plans to ensure it affects us in a positive way.”

Now available to purchase via Amazon, iDisrupted is a book about disruptive technology, how it will affect business, jobs, the economy, and even what it is to be human.

For more information about iDisrupted visit www.idisrupted.com

The world had de-coupled, we were told. Time was, that when the US consumer sneezed, the rest of the world got a cold.

Then in 2008, the US consumer was sent to bed, with a thermometer in his/her mouth, and the rest of the world was in agony.

Then something odd happened. After a few months, in which everyone suffered, the emerging world did okay. China did more than okay, it boomed.  The BRICs, or if you want to include South Africa in that illustrious group, the BRICS, took the baton of growth from the US.

Sure there was talk of currency wars, sure the UK limped along like a cripple on broken crutches, but the global economy did well. It had de-coupled we were told.

Or did it? There are time lags in these things.

Now things seem to have gone into reverse. Sure China is still growing, but it is struggling to change from export to consumer led growth. India is picking up, Brazil looks dire, Russia looks worse, and if you want to make the small ‘s’ at the end of BRICS into a big “S” South Africa  is struggling.

There are signs Japan may be recovering, more of that in another article, the Eurozone is well and truly stuck in a very low gear, or even reverse, but the UK and US are the new stars.

The UK economy slowed a bit in Q3, with quarterly growth down to 0.7 per cent, from 0.9 per cent the quarter before. But then the UK’s main trading partner is the Eurozone. At least investment is rising at a very brisk pace, and that gives good reason for cheer.

But there is even more reason to cheer the US.

The year got off to an awful start, with a cold winter and unfortunate timing of the inventory cycle hitting  the economy hard. Was the Q1 contraction a one-off?   Or was it a sign of something more serious?

Well the data on the US economy has been unremittingly good, ever since.  Take for example the latest US consumer Confidence Index from the Conference Board. It hit a new seven year high in October. If you like your numbers, then you may be interested to know the index hit 94.5. The last time it was so high was in October 2007.

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Yet, the global economy still struggles. If it has de-coupled, then right now this is negative thing.

But there is one other issue here.

As the US recovers, the Fed makes noises about upping rates. This is spooking markets, and hitting emerging economies hard.

It is not that the US economy is no longer the lynchpin of the global economy. It still is. It is just that the actions of the Fed seem to count for more than the well-being of the US consumer.

But can the US consumer yet save the day? Only time will tell, but it is surely the case that if US Consumer Confidence continues to grow, then the rest of the world will grow with it – eventually.

p.s. I have been away for a while to complete my new book, called ‘iDisrupted‘ which is available to purchase via Amazon. If you are interested in my thoughts about how the incredible changes in technology are likely to change our world forever then you are invited to buy the book and let me know whether you agree or disagree with my predictions. Further details about the book can be found on www.idisrupted.com

Michael Baxter, The Money Spy

It’s confusing isn’t it. We are inundated with news, data and bold claims about the economy and where it is going. One expert tells us one thing,  another tells us something else. Even data is often contradictory. If you don’t find it hard to make sense of it all, then you are a better person than any of us.

So we have summarised it all: put the key facts and premises and hot topics in one document.  It is easy to read, and indeed when you consider the subject matter, quick to read. A snapshot of what we feel are the important bits in other words.

As someone who writes about the economy every day, I have found this document useful, it has helped me tell the things that matter from the noise.  I am guessing that if it is important to you to have a feel for the current state of the economy, then you will find it useful too.

The report is free, no catches, or rather just a minor catch, which you might not think is a catch at all. In return for emailing the report to you, we want your permission to put you on our email list for receiving our free Investment and Business News newsletter. It is quick, entertaining, read and by the way did I mention it was free?

To receive the report just fill in the box below and we will send you a pdf file containing the report. You will also start to receive a regular copy of the Investment and Business News newsletter which you can cancel at any time in the future should you no longer wish to be on our mailing list.

Or you can just email me directly at michaelbaxter@investmentandbusinessnews.co.uk and I will gladly send you a free copy.

Michael Baxter

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And talking about the real world, have you seen the latest forecast from the OBR – the Office of Budget Responsibility?

You may recall, the OBR was set up by George Osborne as an independent economic forecasting group to act as a kind of objective judge on economic performance. And in a master stroke, George turned a poacher into a gamekeeper by recruiting the then boss at the Institute of Fiscal Studies (IFS) Robert Chote  – who had been having great fun ridiculing government projections – to head the OBR.

As it happens, Mr Chote is funny. When he was top man at the IFS he made some genuinely amusing presentations, which may be why he became so popular with the press – he is a good man to quote, as well as good at livening up dull press conferences.

But the forecasts from the OBR are no laughing matter.

It originally projected growth for 2012 at 2.8 per cent. Now it is saying minus 0.1 per cent. It is forecasting growth next year of 1.2 per cent, but frankly it is guessing. It has no idea what next year, 2014 and then 2015 will be like. It might as well stick a pin in a piece of paper, and then carry on with the data muddle it has been working with.

The man who may be closest to the truth is Bill Gross, the world’s leading bond investor. He and his colleagues at Pimco have started talking about what they call a new normal.

“In the past decade,” said Gross recently, “machines and robotics have rather silently replaced humans, as the US and other advanced economies have sought to counter the influence of cheap Asian labour.” He went on to cite a report from MIT, which “affirmed that workers are losing the race against the machine.” And concluded: “Technology may be leading to slower, not faster economic growth despite its productive benefits.”

A few years ago, the benefit systems had become silly. The incentive to work had diminished. But be careful. Some people who are unemployed have done everything possible to get a job. It may happen to you, too. Even people who have enjoyed tremendous success in the past can find themselves armed with antiquated skills, and have to go from a senior job in business to being turned down for jobs paying the minimum wage.

In an era when technologies, such as 3D printing, make it hard to see where jobs will come from, being unemployed is becoming a sin. In his Autumn Statement George has said he is going to increase benefit payments by less than inflation. A year or so ago, the ‘Telegraph’s’ Nick Cowie argued that the unemployed should not have the vote at elections. See: A tax-based alternative to the Alternative Vote http://blogs.telegraph.co.uk/finance/ianmcowie/100010127/a-tax-based-alternative-to-the-alternative-vote/

Maybe technology is why the OBR keeps getting it wrong. Technology has created a new normal, and economists are so busy insisting that technology is not creating growth, that they miss the real point. It is changing the world, but it is making jobs all the harder to come by. There are solutions, but until the cause is acknowledged, the solutions will not be considered. By the way, there is a new book by Nassim Taleb – author of the Black Swan and possibly the most influential writer in the world at the moment – called ‘Antifragile’ which makes a related point. For that matter ‘The Blindfolded Masochist’ by Michael Baxter, makes a similar point.

©2012 Investment and Business News.

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The Bank of England has been coming in for some flack about QE. In particular pensioners, and those who represent them, hate it. They say that those who live off their savings, those who have diligently saved all their life are being pulverised by QE. It not just unfair, in the long run it will be catastrophic for UK plc, because it is sending out the message that irresponsible spending will be rewarded.

The Bank of England responds by saying QE has pushed up asset prices, and that is good for pensions, and good for savers.

But one thing that the Bank has admitted to is that QE has benefitted the richer more than it has those at the lower end of the wealth spectrum.

Marc Faber is one of those famous investors the media likes to quote. He, along with several others, is also known as Dr Doom.  Recently he told Bloomberg that: “The fallacy of monetary policy in the US is to believe this money will go to the man on street. It won’t. It goes to the Mayfair economy of the well-to-do people and boosts asset prices of Warhols… Very happy. Very Good for the Fed. Congratulations, Mr Bernanke. I’m happy. My asset values go up but as a responsible citizen I have to say monetary policies of the US will destroy the world.”

The truth is that trickle down is one of the biggest problems in the world today. And it was a key problem in the noughties too, but during the boom it just got ignored.

Take the US. Data released last week shows that median income for US workers is now at a 16 year low. That is to say, after allowing for inflation, median US workers are earning less money now than in the late 1990s.

Yet unlike the UK, the US economy is growing; output passed the pre-recession high some time ago. For the last decade or longer we have seen a change in the way in which the economy is balanced. Company profits have been rising, and wages as a share of total GDP falling. For an individual company that may seem like a good thing. But when wages across an economy are not rising, then that means demand cannot rise without a corresponding increase in debt. It is also possible that a side-effect of rising profits at the expense of wages was money sloshing around the money markets, pushing down interest rates, which created easily available credit.

So house prices rose, and households felt richer. Even if wages were not rising fast, people borrowed against their property, and spending was funded by debt.

It is not hard to find a cause for all this. The combination of globalisation and advances in technology had a hollowing out effect.

We aren’t suggesting here that either globalisation or technological progress is a bad thing. But just because you are in favour of something, it does not mean you cannot admit to faults. A parent who is blind to their child’s shortcomings and therefore does not try to correct them is a bad parent. But globalisation’s greatest supporters won’t countenance any criticism at all. Either you are an out an out supporter, or you are some mad protestor – a member of the occupy Wall Street movement.

And because no one is facing up to the problems, we are not moving any closer to a fix.

As for technology, economists seem to have a real problem talking about technology; their theory is just lousy at taking it into account.  Innovations are occurring around us and very few economists even give it a second thought.

QE’s big problem is it that it is very inaccurate; you cannot target it at all – or at least Mervyn King recoils at any attempt to do so. So it may be QE is solving some of the problems around at the moment, but it is doing nothing to address the underlying causes.

Anyway, this is one of the ideas discussed in The Blindfolded Masochist, by Michael Baxter. Sometimes our behaviour can seem logical and sensible when applied by individuals, but across the economy, it can be self-destructive. See The Blindfolded Masochist