Shadow banking systems don't like the light shining their way. When someone cares about the handshake deal market, it's generally a sign that trouble is brewing. That's why
a recent Financial Times post about a storm developing in China's shadow banking world is worth noting.
Kate Mackenzie's piece essentially reports on a Societe Generale report on the fragile state of the real Chinese economy. Essentially, according to
Soc Gen economist Wei Yao, it's in tough shape, torn between stunting credit growth to "unworthy" companies while continuing to lend to the stronger firms. The analogy used in Soc Gen's report was fish vs. dragons. The ancient Romans might have characterized the distinction as between Christians and lions.
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Telephone Booth, 3 a.m. Rahway, NJ
Photo by George Tice |
Why should we care about this report? The Chinese economy is largely viewed as a key driver to lift the developed world from either its ongoing or upcoming recession. The Soc Gen report effectively throws cold water on Chinese businesses running into phone booths and collectively emerging as an economic Superman. Any other suggestions for growth? Europe? Russia? India? Brazil? Mars?
Of course, the American mainstream media have either referred to recession in the past tense or the future perfect tense. Right now, everything in the US has returned to a sort of false financial grooviness. If you're prosperous and don't have to sweat tepid business growth realities, then, yeah baby, the recession was a passing headache. For most Americans, however, contemporary truth is grimmer.
The number of Americans on food stamps is at an historically high level. Small businesses in the Land of the Free are largely excluded from the credit markets. The housing market, outside of a handful of desirable, insanely expensive areas, seems reminiscent of shipwreck survivors hopefully clinging to floating debris. The feeling is "things will get better, won't they?"
The bewilderment at the heart of this economic conundrum has produced something of a "deer in the headlights" feeling at high fiscal and political policy levels in the United States. Now that we understand China won't -- and can't -- ride to the rescue, the lack of ideas at the top becomes an even greater cause for profound concern.
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| David Packard (left) and Bill Hewlett |
Well, an obvious "way out" of the predicament is for American firms to make products people around the world want. The most prominent example of this path is Apple. I think that's one reason why so many people felt an emotional sense of loss at Steve Jobs' passing. He created things people wanted. The buzz about Apple had always been "what happens after Jobs?" In a larger sense, who in Silicon Valley, or anywhere else, would be able to hold the torch of tech innovation after Jobs died? This was an issue that mattered to Jobs, as
Wired noted in a recent piece on Apple's former CEO. He particularly admired the sensibilities of
Bill Hewlett and
David Packard. Jobs regarded HP as the standard bearer for tech firms, their standards and their values; his tenure at HP unquestionably shaped Jobs' own keen interest in developing Apple's corporate culture.
No one really knows who will take the torch Jobs held and in many ways inherited from Hewlett and Packard. That feeling of uncertainty informs part of the post-Jobs tech world and the uniquely American sense of optimism it embodies. That uneasy sensibility underpins much of the sentiment expressed about Jobs in the aftermath of his passing.
The ascent of dogmatic American political ideology, the moral bankruptcy of US business leadership, a diminishing zeal for invention, and the rise in the nearly unquestioned belief that the achievement of "comfort" is the greatest possible good, are all symptoms of an America in decline. The coming financial storm in China will impact the United States, and leave America with few options to address its own crisis.
Fasten your seat belts: it's going to be a bumpy ride.
Commencement speeches are among the most deadly dull forms of public address. Steve Jobs' words of wisdom to Stanford's 2005 graduating class are an exception. His brief remarks provide useful insight based on Jobs' life and career experiences. They include a window into the mix of thoughtful understanding and irritating hubris characteristic of Apple's guiding light. They're worth reading; his "don't settle" advice is spot on.
Apple's arrogant Steve Jobs, who has kept his firm's shareholders and nosy media inquisitors at arm's length for years, finally met his match today. A U.S. district court judge ordered the wizard industrialist to appear for a two hour deposition involving a class action lawsuit against Apple. The story appeared in the Mercury News' SiliconValley.com column and in the LA Times.
A story originally reported in The Wall Street Journal noted that major Silicon Valley players are in discussions with the Department of Justice over a rumored antitrust action against the firms. The allegations include collusion to not recruit or hire employees of the other conspiring enterprises. The all-star list features many Silicon Valley A-list companies, including Google, Apple, Intel, and Pixar.
