Travels etc.

While reading some paperwork regarding International Tax Law subject following statement drew my attention: "The complexity of the international tax rules makes it nearly impossible to diffuse the public sensibility about the issues." It is from the speech "Sense and Sensibility: The Policy and Politics of BEPS" by Manal S. Corwin.  The full text can be found here: https://www.kpmg-institutes.com/content/dam/kpmg/taxwatch/pdf/2014/beps-corwin-tillinghast-tn-100614.pdf That thought is not unique to tax law. In my experience of more than 3 years doing what I call “applied dispute resolution” which correlates with law research and paralegal activities I see that in any area of law, social matters, environmental, humanities, economics and others we can witness increasing level of challenges that our society face. Let’s take as an example The Law. Carefully crafted legal framework is one of the essentials of contemporary society. However ...

There is usually two distinct perspectives on multi-tasking: 1. Multitasking is counterproductive. We get distracted by multiple tasks that all get our way and fight for our scarce attention, time and resources. This leads to a common fallacy that if you do multiple activities “at a time” you are not doing good work in any of those. 2. Multitasking is a way of getting many things done in a short period of time or in a long run. Indeed it can be either a disaster or a great helper depending on how it is used and practiced. Most recent research shows that we don’t do multiple tasks purely in parallel or simultaneously. That means we don’t purely multi-task, but switch between tasks and execute them one at a time, but by spending very small timeframes on each task. A good example from the history is a story about Julius Caesar capabilities in that area. Plutarch writes, “Caesar disciplined himself so far as to be able to dictate letters from on horseback, and to give directi...

We all have probably seen on the Web pictures which may look like the following: It implies that if someone quotes to a customer low (or lower than average, I presume) price for the services or products it necessary means low/lower quality of the services or products provided. This is very interesting assumption and I had a short conversation a while ago on Twitter with another SharePoint specialist about it: Original Bjørn's article should be here http://t.co/36brwYq4Kf A study in Journal of Consumer Research http://www.jstor.org/userimages/ContentEditor/1351717003127/DevalRelease.pdf in regards to the subject clearly shows: '" Consumers rarely have complete information and use various strategies to fill the gaps in their knowledge as they consider and choose products. One of these strategies involves using naive theories : informal, common sense, explanations that consumers use to make sense of their environment. For example, consumers may believe th...

It’s hard to underestimate importance of planning. It is (or should be) integral part of any conscious activity that requires more than 1 step and implies a target. Especially when we deal with complex processes of various kinds. Contemporary prejudice about planning is that it’s only relevant to big projects like construction, IT, space exploration, military operations, massive production etc. However any activity that involves setting up a goal and steps to achieve it requires planning. Why is it necessary? Because we need to: 1. Estimate approximate date/time to reach the goal 2. Understand what/who is required to achieve the goal 3. Measure success or failure 4. Review and adjust the plan if needed. So planning may help not only at work, but also in personal life which will in turn positively influence our so-called work-life balance. Planning should only serve one purpose – reaching as close as possible to the target. Very often this idea is being overlooked and burie...

Have read an ambiguous article today about " Young People in the UK to Choose Between Poverty and Debt ". What is apparent, there are socio-economical issues that the UK people would like to resolve: growing unemployment growing poverty young people sitting on welfare payments competition from skilled people from other countries The initiative David Cameron announced sounds very interesting, especially in it's part where jobless "would have to accept mandatory 'community work'" if failing to find employment within reasonable timeframe. I would like to highlight some failing points in the article that are presenting the initiative as "predictably vindictive" and with permission from a reader to provide advice to "young" persons like me. One of the complaints is low level of payment for apprenticeship and for young men and women who just finished studies. This claim is based on presumption that every business owner (and...

An article about Canadian problems regarding mortgage, but advice is international though http://www.cbc.ca/news/business/paying-off-your-mortgage-faster-can-pay-huge-dividends-1.2719753 However, in Canada the level of household debt relative to disposable income was a near record 163.2% this year. That means majority of people just don't have money to implement the strategies outlined in the article.

Have recently watched "Four Horsemen" - documentary on current global economic issues. It was interesting, because I have recently read a book Confessions of an Economic Hit Man  by John Perkins who is also featured in the documentary. What I found is that though the general idea towards "greater good" is natural, the ways how issues are explained in the movie and the reasons and solutions that are briefly outlined are not consistent sometimes with either logic or obvious observations. 33:00 - The narrator states that the inflow of lending money into the housing market led to an unprecedent inflation. "House prices rose and rose." This completely satisfies the classical economic theory that guys just praised a bit earlier in the video. Because interest rates were low and people borrowed more and more to buy properties. But is it not because there is always a demand for property? People have to live somewhere. At 33:40 Prof. Simon Johnson (for...

Interesting article regarding increasing childcare prices in Australia: http://www.sbs.com.au/news/article/2014/06/22/rocketing-childcare-fees-sees-parents-lose-60-salary In my opinion, the explanation by principal researcher of rising prices is not all valid. I agree with lack of supply though. This is due to following reasons: Too much regulation and red-tape before a childcare facility can start operating. This is reasonable, because not everybody should be allowed to open a childcare facility.  High wages that childcare centres have to pay to a high number of employees. It's not high salary that each childcare worker receives - in reality it's indeed opposite. There is a requirement that children per teacher ratio should be 4 or 5. Therefore many teachers are required.  High rent.  I accept the items 1 & 2, because it's is valid to keep the regulations high and keep proper basic childcare at a good level of compliance. However "high standards...

I am about to complete the " Understanding economic policymaking " course from IE Business School . Done the assignment - develop an ideal policy program for the hypothetical country with the following indicators in the past 4 years: high inflation, increasing unemployment, slow GDP growth, growing public debt and other similar nice things in addition to very high business regulations. I offered a policy program for two years. Results: Year 1 – economic boom, GDP grew up to the potential level, unemployment decreased; Year 2 – economy growth with increase in aggregate supply, unemployment decrease, GDP growth and public debt decrease (extra bonus). Now looking for a real country that would agree to implement this practically.

Situation Coal in Africa: An opportunity is available to invest in a coal mine in West Virginia. The mine’s value is less than in past years because of actual and anticipated restrictions on coal-fired power generation in the United States. However, the mine has a chance to sell its coal on contract to a public utility in West Africa. The utility is working through the World Bank for financing to build a number of coal-fired power plants. If they obtain World Bank financing, then a customer for the coal mine is assured, at least for the duration of the contracts. The power plants will employ the best current technology for burning coal, which exceeds all current air quality standards for the region. However, the power plants will not be designed to attempt carbon capture. The area of Africa the plants will serve suffers from extreme energy poverty, with some of the lowest per capita energy consumption in the world. Overview of the Region West Africa is the westernmost reg...

Have recently started  Understanding economic policymaking  course by  IE Business School . Though the name doesn't say macroeconomics, it's the best macroeconomy lectures I have ever attended. Even some specific economy courses didn't do much for me to start understand the principles and rules. Professor Gayle Allard is a great instructor and the structure of the course is very easy to follow and to learn. The course is an awesome opportunity for everybody interested in how the economy works.

Have got an interesting read this morning -  America's young workers: Destined for failure? In regards to the education and "The obvious solution is for university, community college, and industry leaders to get together and design the coursework and the on-the-job experiences young workers need to be productive, learn, grow, and gain access to better and higher paying jobs.", I see a couple of issues here: 1. Current education system is still mentally a centuries old master-apprentice type of concept. At the times when it was relevant and apprenticeship may take years to spend on learning the certain trade the trade wouldn't change much and after somebody finishes the studies the trade would still be the same for the lifetime of the person or even several generations. This system just simply doesn't cope effectively with our modern challenges of industries appearing and disappearing and older traditional occupations paying less and less to their practitio...

Let's look at the February 2014 information about Australian retail trade and check what the trends are in comparison with the same period last year in the major and minor industries of that trade and the most recent quarter. Turnover includes: retail sales;  wholesale sales;  takings from repairs,  meals and hiring of goods (except for rent, leasing and hiring of land and buildings);  commissions from agency activity (e.g. commissions received from collecting dry cleaning, selling lottery tickets, etc.);  and the goods and services tax. Will start with NSW.  Here's the top 2 industries - Supermarket and grocery stores & Food retailing ($ Millions): What is obvious - food retailing follows the trend of supermarket and grocery stores. In comparison with same period last year both industries have grown by 0.1% Two others from top 5 industries in NSW retail - Household goods retailing & Cafes, restaurants and takeaway food service...

According to the British Petroleum Statistical Review of World Energy, 2013 , global coal reserves declined in the decade ending 2012: Figure 1. Proved coal reserves . Proved reserves of coal are generally taken to be those quantities that geological and engineering information indicates with reasonable certainly can be recovered in the future from known deposits under existing economic and operating conditions. If we look at supply and demand factors in the decline, we can see that: a) Coal price has grown significantly in the decade ending 2012 1 :   Figure 2.  Prices in US Dollars per tonne . b) Coal consumption has also grown significantly worldwide 2 : Figure 3. Coal consumption by region . c) The price of substitutes (i.e. Natural Gas) has also grown. Not so in North America though, but if we look at the world trend it is growing 3 : Figure 4. Natural gas prices . Therefore if the rule of supply and demand worked we would see increase i...

The Wealth of Nations: An Inquiry into the Nature & Causes of the Wealth of Nations by Adam Smith My rating: 5 of 5 stars Have just finished this book. It has been a long process, but fully rewarding. It's the hardest book I have ever read. Firstly because of the author style and secondly because of my habit to read everything in the book and not jump to the next section until I understand the current one. I have heard of Adam Smith's ideas from other sources before, but now I see that majority of those who said Smith is this or Smith is that - haven't read this book at all. In addition to that, many people think theories of 17th and 18th century don't work today. however during the whole time of reading I have had a feeling that Smith has written about today with only a few differences. I highly recommend this book to everyone who is interested in how everything works around us. View all my reviews

Some interesting ideas from the Wealth of Nations by Adam Smith regarding big capital: "The trade of a joint-stock company is always managed by a court of directors. This court, indeed, is frequently subject, in many respects, to the control of a general court of proprietors. But the greater part of these proprietors seldom pretend to understand any thing of the business of the company ; and when the spirit of faction happens not to prevail among them, give themselves no trouble about it , but receive contentedly such halfyearly or yearly dividend as the directors think proper to make to them." "The directors of such companies, however, being the managers rather of other people’s money than of their own , it cannot well be expected that they should watch over it with the same anxious vigilance with which the partners in a private copartnery frequently watch over their own. Like the stewards of a rich man, they are apt to consider attention to small matters as not ...

Not long ago I published an article  Economic Lessons - Consumer Influence on Price  with an intent to show that not everywhere rules of supply and demand work as per the textbooks and as per wishes of some people. I have discussed this topic with many people and majority seem to still believe in supply-demand mantra. Today I stumbled upon the article by BT Financial Group -  4 surprising facts about the property market : "Supply and demand pricing rules don’t always work with property".

Have read the article  The Collapse of Big Law: A Cautionary Tale for Big Med In my opinion it is all logical. When instead of thinking about health (or law, or education) as a goal, but of money as a goal - this is a natural consequence. If everybody else around is focused on maximizing the profits why lawyers, teachers or medics should be exceptional? They are part of the society.

From time to time an opinion comes up regarding state deficits, national debts etc. Here's the insight on how it is relevant and whether it does influence wealth of the country or not: "The balance of produce and consumption may be constantly in favour of a nation, though what is called the balance of trade be generally against it. A nation may import to a greater value than it exports for half a century, perhaps, together; the gold and silver which comes into it during all this time, may be all immediately sent out of it; its circulating coin may gradually decay, different sorts of paper money being substituted in its place, and even the debts, too, which it contracts in the principal nations with whom it deals, may be gradually increasing; and yet its real wealth, the exchangeable value of the annual produce of its lands and labour, may, during the same period, have been increasing in a much greater proportion. The state of our North American colonies, and of the trade ...

We have not long ago discussed some aspects of sociology. There is an opinion that theories of 17-19th centuries are not applicable today - in the 21st century. However as I am reading Adam Smith at the moment, here's quite an interesting quote: "In every country it always is, and must be, the interest of the great body of the people, to buy whatever they want of those who sell it cheapest . The proposition is so very manifest, that it seems ridiculous to take any pains to prove it; nor could it ever have been called in question, had not the interested sophistry of merchants and manufacturers confounded the common sense of mankind. Their interest is, in this respect, directly opposite to that of the great body of the people . As it is the interest of the freemen of a corporation to hinder the rest of the inhabitants from employing any workmen but themselves; so it is the interest of the merchants and manufacturers of every country to secure to themselves the monopoly o...