Comment, analysis and other offerings from Tuesday’s FT,
Analysis: Corporate earnings – revival of the fittest
As large western groups reap the benefit of costs cut when the crisis hit, the worry is that the sources of this season’s buoyant results may be only fleeting, write FT reporters.
Jagdish Bhagwat: ‘Made in America’ is not the way out
A new fascination with manufacturing is a direct consequence of the financial crisis, writes Bhagwati, university professor of economics and law at Columbia. The crisis began on Wall Street, so many conclude that the financial services sector is socially harmful or over-expanded and needs to be restricted. By contrast, it seems logical that manufacturing is both socially useful and ought to be larger.
Joachim von Braun: Time to regulate volatile food markets
With the current extreme price increases for wheat, we are observing potentially the early stages of another global food-price crisis. Even if this does not evolve into something as dramatic as the crisis of 2007-08, which triggered food riots from Bangladesh to Haiti, it is a stark indication of the perilous state of the world food market, writes the former director-general of the International Food Policy Research Institute.
News analysis: Tide turns against annual raw materials contacts
Most European companies that depend on raw materials markets believe annual price contracts are “no longer appropriate”, dealing a blow to proponents of yearly benchmarks at a time when the pricing system for many key commodities is in flux, reports the FT’s Jack Farchy.
Management: ‘I don’t have time to think’
After the diagnosis team at The Mind Gym had heard this for the umpteenth time from managers at a well-known telecoms company, we decided to run an experiment, writes Octavius Black, Mind Gym’s CEO. On the first day of a three-day summit we hosted a silent lunch. BlackBerrys were handed in at the “phone spa” and everyone was given a hearty meal to enjoy on Trappist monk terms – strictly no talking. There was an executive riot.
Market Insight: Improve banks’ survival with living wills
We believe that the authorities, under the exceptional circumstances in late 2008, had no choice but to support the financial system, write Charles Goodhart, emeritus professor of banking and finance at the London School of Economics, and Dirk Schoenmaker, dean of the Duisenberg School of Finance in Amsterdam. But, if anything, the handling of the current financial crisis has reinforced too big to fail doctrine. So how can one reduce moral hazard and reduce expectations of future bail-outs?
Energy Source: Controversial peak oilist Matthew Simmons dies
Matthew R. Simmons died suddenly of a heart attack on Sunday, writes the FT’s Carola Hoyos. He was the controversial author of Twilight in the Desert, which shed doubt on Saudi Arabia’s continued ability to supply the world with oil.
Westminster: How will councils be financially rewarded for new homebuilding?
It’s a question that lies at the nub of Grant Shapps’ plans — announced on Monday — for rewarding areas where more homes are built, notes the FT’s Jim Pickard.
Gavyn Davies: Fed expected to buy insurance against a double dip recession
The financial markets have now discounted some form of Fed easing at tomorrow’s FOMC meeting, and it seems to me unlikely that policy makers will allow these expectations to be completely dashed, writes the macroeconomist.