This guest article was written by William Laraque who is the Managing Director of US-International Trade Services.
The Promise of a Different World
According to Mme. Lagarde of the IMF: "Tech gurus estimate that 66% of the jobs that people now in high school will have don’t yet exist." The trick is how do we prepare them? How do we retrain those whose jobs will be eliminated by robots, to make sure that we don’t have more inequality and more disruption in the social contract?”
Good economic policy is how we can keep the gap between the rich and the poor from growing and how we can ensure that global economies are growing both profits and jobs — that is, that they’re truly productive.
Only 1 percent of small businesses in the United States tap global markets for fresh revenue growth, according to government statistics. Of that total, only 2 percent export to more than one country. German small businesses export to an average of 6 countries. Chilean exporters, trained and educated in ProChile, that country's excellent export-directed program, sell to an average of 13 countries. In short, competition is scarce. There’s a lot of money to be potentially gained from sales generated abroad, where Dell reminded US citizens that 95% of our potential customers are.
The Mobile Banking Connection
The global spread of mobile banking has exceeded all projections. Yet today, more than two billion people have no access to financial services, severely limiting their ability to borrow, save, invest, and participate in the mainstream economy.
But that is changing fast. A new report by scholars at the Brookings Institute confirms that many countries are making national commitments to financial inclusion and helping mobile banking reach critical mass. Kenya is a good example of what’s possible. Today 75 percent of adults there have accounts with a bank or mobile-money provider, up from only 42 percent in 2011.
Other countries that are making huge strides include Brazil, Rwanda, Tanzania, Bangladesh, and India. According to Bill Gates: "I love the fact that when I’ve travelled in these countries, I’ve seen digital financial innovation that’s even outpacing what we see in rich countries."
Recession and Disruption in the Global Economy
It is incontrovertible that the global economy is undergoing almost unprecedented disruption both in extent and in pace. The traditional ways of accumulating wealth are being simultaneously challenged by a changing demographic and by changing trade flows. There were 28 persons working for every retired person during my prime working years, my heyday in the 1980s; now there are 14. OPEC dominated the global economy in 1974 and 1975 when I started my banking career.
Fracking, horizontal drilling, and other technological developments have made the US less dependent on domestic coal and imported oil and natural gas. As an aside, the technological difficulties of fracking were solved by an 89-year old George Mitchell, son of a goat-herd.
Trade, the Internet and Economic Diffusion
The fact that the emerging world is no longer solely dependent on trade with the developed world does not mean that the developed world goes into recession. It signifies that the developed world will have to exercise leadership and a flexibility and fluidity of mind to deal with an ever changing global scenario.
Jeremy Rifkin warned us about the scenario in which the internet (and hydrogen) would lead to a diffusion of energy, of political power and of wealth. Disruption does not occur without chauvinism, without the digging-in of heels, the dragging, kicking and screaming that attend those who will not accept change and the accelerating pace of change; what my friend Adrian Rutter calls "the thunderous mediocrity of established Interests."
The Unprepared
The greatest disruption of all will come from e-commerce and its conflation of logistics, mobile banking and 31 other disciplines. As it becomes a mainstream means of exchanging goods for money, disruption will accelerate because those who are self-appointed to benefit from plutocracy and oligarchy, to command economies from the heights, will be disrupted by the most influential of all political movements, namely democracy and egalitarianism on a global playing field.
The Gig Economy
Uber and Airbnb are producing hundreds of thousands of 'gig' jobs and the implications regarding startups, employment, benefits and the social safety net are massive.
What our US politicians uniformly fail to realize is that the gig economy in the US is a microcosm of entrepreneurship and its global spread.
Entrepreneurs constitute an important and growing part of the global economy. The culturally-connected entrepreneur is the inter-economy link to global trade flows. What many politicians, economists and bankers fail to understand is that the financial tools to empower a full global trade participation by both entrepreneurs and economies, with the consequent economic and job growth, are available and have been since the 1970s.
Transitioning to Global Engagement
Multinational corporations have had their run. Plutocracy has been fundamental to the economic success and proliferation of such corporations.
Prior to the Trump election, Princeton University studies had declared the US to be a plutocracy. State-directed economies resorted to oligarchy in order to compete against the plutocracy of Western economies. While the US insisted on evidence of human rights and environmental 'sensitivity' in other countries as a condition of trading with them, China through its R4I or Resources for Infrastructure Investment program has rampaged through Africa and to a significant extent, South America.
R4I has now morphed into other ways of achieving Chinese economic influence and hegemony; namely building bases on rocks and atolls in the South China Sea and OBOR, its One Belt, One Road program. These programs extend Chinese economic and military influence from Southeast Asia to the Horn of Africa and through Central Asia to Europe. This economic and military hegemonic demarche has had a parallel blitzkrieg via e-commerce and mobile banking.
I have sufficiently described the spread of Alibaba, Tencent, Ant Financial and Alipay in numerous other articles. Chinese e-commerce platforms are now raising funds in US capital markets and through IPOs. Such firms as Goldman Sachs and Morgan Stanley and the US VC community are tripping over themselves to facilitate this denouement.
The Counter-Attack
It is not China alone which has advanced its economic and military influence along OBOR and the globe. Such US enterprises as Amazon, Walmart, Paypal, Amazon Web Services have spearheaded a US competitive riposte by providing e-commerce platforms.
A simple comparison between the Chinese and Western e-commerce initiatives can be made by analyzing a single day (pardon the pun), 11 November, Singles Day in China. Last year, this combined e-commerce, mobile banking and logistics masterstroke resulted in sales of $14.5 billion. This year sales of $17.7 billion were achieved.
This one-day tour-de-force utilized some 200 transport aircraft to transport the goods of Costco, Macy's, Mondavi and other in-demand US and European-made goods to Chinese consumers. This masterpiece of logistics and e-commerce left US authorities tongue-tied with allegations of Chinese accounting-related 'misrepresentation' against Alibaba.
Political Change
The Brexit
Brexit
Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis
Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis
Read this Term and the advent of the right-wing populism of Trump represent the need for a more egalitarian distribution of wealth from what will be $85 trillion worth of global trade flows by 2025. Suddenly, this date, this achievement does not seem distant.
What does seem to evade the grasp of US policy-makers, politicians and educators is a concerted educational and policy effort to define what Mme. Lagarde refers to in the beginning of this discourse; defining the economic and political future of our children and grandchildren with leadership.
This guest article was written by William Laraque who is the Managing Director of US-International Trade Services.
The Promise of a Different World
According to Mme. Lagarde of the IMF: "Tech gurus estimate that 66% of the jobs that people now in high school will have don’t yet exist." The trick is how do we prepare them? How do we retrain those whose jobs will be eliminated by robots, to make sure that we don’t have more inequality and more disruption in the social contract?”
Good economic policy is how we can keep the gap between the rich and the poor from growing and how we can ensure that global economies are growing both profits and jobs — that is, that they’re truly productive.
Only 1 percent of small businesses in the United States tap global markets for fresh revenue growth, according to government statistics. Of that total, only 2 percent export to more than one country. German small businesses export to an average of 6 countries. Chilean exporters, trained and educated in ProChile, that country's excellent export-directed program, sell to an average of 13 countries. In short, competition is scarce. There’s a lot of money to be potentially gained from sales generated abroad, where Dell reminded US citizens that 95% of our potential customers are.
The Mobile Banking Connection
The global spread of mobile banking has exceeded all projections. Yet today, more than two billion people have no access to financial services, severely limiting their ability to borrow, save, invest, and participate in the mainstream economy.
But that is changing fast. A new report by scholars at the Brookings Institute confirms that many countries are making national commitments to financial inclusion and helping mobile banking reach critical mass. Kenya is a good example of what’s possible. Today 75 percent of adults there have accounts with a bank or mobile-money provider, up from only 42 percent in 2011.
Other countries that are making huge strides include Brazil, Rwanda, Tanzania, Bangladesh, and India. According to Bill Gates: "I love the fact that when I’ve travelled in these countries, I’ve seen digital financial innovation that’s even outpacing what we see in rich countries."
Recession and Disruption in the Global Economy
It is incontrovertible that the global economy is undergoing almost unprecedented disruption both in extent and in pace. The traditional ways of accumulating wealth are being simultaneously challenged by a changing demographic and by changing trade flows. There were 28 persons working for every retired person during my prime working years, my heyday in the 1980s; now there are 14. OPEC dominated the global economy in 1974 and 1975 when I started my banking career.
Fracking, horizontal drilling, and other technological developments have made the US less dependent on domestic coal and imported oil and natural gas. As an aside, the technological difficulties of fracking were solved by an 89-year old George Mitchell, son of a goat-herd.
Trade, the Internet and Economic Diffusion
The fact that the emerging world is no longer solely dependent on trade with the developed world does not mean that the developed world goes into recession. It signifies that the developed world will have to exercise leadership and a flexibility and fluidity of mind to deal with an ever changing global scenario.
Jeremy Rifkin warned us about the scenario in which the internet (and hydrogen) would lead to a diffusion of energy, of political power and of wealth. Disruption does not occur without chauvinism, without the digging-in of heels, the dragging, kicking and screaming that attend those who will not accept change and the accelerating pace of change; what my friend Adrian Rutter calls "the thunderous mediocrity of established Interests."
The Unprepared
The greatest disruption of all will come from e-commerce and its conflation of logistics, mobile banking and 31 other disciplines. As it becomes a mainstream means of exchanging goods for money, disruption will accelerate because those who are self-appointed to benefit from plutocracy and oligarchy, to command economies from the heights, will be disrupted by the most influential of all political movements, namely democracy and egalitarianism on a global playing field.
The Gig Economy
Uber and Airbnb are producing hundreds of thousands of 'gig' jobs and the implications regarding startups, employment, benefits and the social safety net are massive.
What our US politicians uniformly fail to realize is that the gig economy in the US is a microcosm of entrepreneurship and its global spread.
Entrepreneurs constitute an important and growing part of the global economy. The culturally-connected entrepreneur is the inter-economy link to global trade flows. What many politicians, economists and bankers fail to understand is that the financial tools to empower a full global trade participation by both entrepreneurs and economies, with the consequent economic and job growth, are available and have been since the 1970s.
Transitioning to Global Engagement
Multinational corporations have had their run. Plutocracy has been fundamental to the economic success and proliferation of such corporations.
Prior to the Trump election, Princeton University studies had declared the US to be a plutocracy. State-directed economies resorted to oligarchy in order to compete against the plutocracy of Western economies. While the US insisted on evidence of human rights and environmental 'sensitivity' in other countries as a condition of trading with them, China through its R4I or Resources for Infrastructure Investment program has rampaged through Africa and to a significant extent, South America.
R4I has now morphed into other ways of achieving Chinese economic influence and hegemony; namely building bases on rocks and atolls in the South China Sea and OBOR, its One Belt, One Road program. These programs extend Chinese economic and military influence from Southeast Asia to the Horn of Africa and through Central Asia to Europe. This economic and military hegemonic demarche has had a parallel blitzkrieg via e-commerce and mobile banking.
I have sufficiently described the spread of Alibaba, Tencent, Ant Financial and Alipay in numerous other articles. Chinese e-commerce platforms are now raising funds in US capital markets and through IPOs. Such firms as Goldman Sachs and Morgan Stanley and the US VC community are tripping over themselves to facilitate this denouement.
The Counter-Attack
It is not China alone which has advanced its economic and military influence along OBOR and the globe. Such US enterprises as Amazon, Walmart, Paypal, Amazon Web Services have spearheaded a US competitive riposte by providing e-commerce platforms.
A simple comparison between the Chinese and Western e-commerce initiatives can be made by analyzing a single day (pardon the pun), 11 November, Singles Day in China. Last year, this combined e-commerce, mobile banking and logistics masterstroke resulted in sales of $14.5 billion. This year sales of $17.7 billion were achieved.
This one-day tour-de-force utilized some 200 transport aircraft to transport the goods of Costco, Macy's, Mondavi and other in-demand US and European-made goods to Chinese consumers. This masterpiece of logistics and e-commerce left US authorities tongue-tied with allegations of Chinese accounting-related 'misrepresentation' against Alibaba.
Political Change
The Brexit
Brexit
Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis
Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis
Read this Term and the advent of the right-wing populism of Trump represent the need for a more egalitarian distribution of wealth from what will be $85 trillion worth of global trade flows by 2025. Suddenly, this date, this achievement does not seem distant.
What does seem to evade the grasp of US policy-makers, politicians and educators is a concerted educational and policy effort to define what Mme. Lagarde refers to in the beginning of this discourse; defining the economic and political future of our children and grandchildren with leadership.
