Economist Dec 1st 2012

Survival of the biggest: digital giants become too powerful for consumers’ good

  • winner-take-almost-all;
  • get consumers hooked on their own platforms;
  • habit of gobbling up promising firms before they become a threat.

Not what it used to be: declining value of American universities

  • in 1962 one cent of every dollar spent went on higher education and now the figure has tripled, but additional value has not been created to match this extra spending;
  • graduates earned no more in 2007 than they did in 1979;
  • young graduates facing decline in earnings and a lot more debt.

The Obama doctrine: to avoid costly entanglement in his second term

  • “come home and rebuild America”: fix failing schools, potholed roads, snail-like internet networks, or a broken immigrant system;
  • present but not deeply involved;
  • compared with the 1990s America looks far lonelier: EU cannot offer significant help, Russia intensely suspicious, and China is a distilled essence of self-interest.

The dust settles: hints of reform from China’s new leaders

  • from “demographic dividend” to “reform dividend” to boost development;
  • state-owned monopolies, the biggest one? Li did not say whether he agreed but did speak the need for reform of household-registration system and land management;
  • talked for years, but progress has been sluggish. how many will support him?
  • far less swiftly in foreign affairs, not sure who will replace Dai Bingguo.

Alone at the top: Putin initiated high-profile battles against corruption

  • anti-corruption purge would make Putin weaker, not stronger;
  • after held in power in a decade, the “typical syndrome of an ageing general secretary;”
  • now less faith in counsel and more certainty in his own judgment, “think he understands the situation, but in fact it can be quite incomprehensible for him.”

Getting a grip: Gary Gorton’s new book on financial crisis

  • systemic financial crises are the result of a broad loss of confidence in bank debt;
  • should apply Livingston doctrine to Lehman Brothers in 2008, where the subsequent panics were so devastating;
  • it might be true that the Dodd-Frank act does not deal adequately with the liquidity cause of crises, but his alternatives seem impractical.

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