Subject: EconVue Spotlight January 12, 2018
From: "Lyric Hughes Hale" <[email-masked]>
To: "R. Hunter Biden" <[email-masked]>
Date: Fri, 12 Jan 2018 21:24:23 -0800 (PST)

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EconVue Spotlight

Dear R. Hunter,

A hat tip to EconVue contributor Nicholas Benes

https://econvue.com/experts/nicholas-benes

for one of our favorite articles this week, on the "quiet life." The 
thesis of this Harvard Business Review

https://hbr.org/2018/01/the-quiet-life-hypothesis-is-real-managers-will-put-off-hard-decisions-if-they-can

study is that managers are likely to put off hard decisions, preferring 
the "quiet life" to confrontation and change in the absence of 
competition. As our New Year's resolutions fade away, worth keeping in 
mind! As promised, you will find the full forecasts of several EconVue 
experts that were summarized in our forecasting issue earlier this 
month. I've also included some papers from the event that opens the year 
for academic economists, the American Economics Association annual 
meeting. Held the first weekend in January, sadly in snowbound 
Philadelphia, key themes were the lack of opportunity for female 
economists, and of course productivity. One subject was significant by 
its omission- out of hundreds of papers and sessions, only a single 
panel on Fintech, and nothing on cryptocurrencies. Through a Twitter 
exchange I found out that Trinity Prof. Gina Pieters did submit a paper 
that was not selected for presentation. The list of academics working on 
this issue fits on a single page, which Prof. Pieters has kindly 
compiled here: http://www.ginapieters.com/crypto-academics.html

http://www.ginapieters.com/crypto-academics.html

In a world bereft of volatility, I find this subject fascinating. Market 
capitalizations are exaggerated: they are based upon the total number of 
coins outstanding multiplied by the most recent price. In these 
thinly-traded markets, a single transaction can change prices. However, 
cryptocurrencies are beginning to affect the real economy. It is 
estimated that bitcoin is now .3% of Japan's GDP. For a discussion about 
crypto as an asset class, the article below by economics professor 
Lawrence White about how it is and is not like gold is illuminating.

RESEARCH BY ECONVUE EXPERTS 5 Days that Shook the Healthcare World

https://econvue.com/pulse/5-days-shook-healthcare-world

David Johnson

https://econvue.com/experts/david-w-johnson

In early December, a series of blockbuster transaction announcements 
rocked the healthcare industry. Major healthcare payers, providers and 
retailers signaled their intention to reconfigure business models to 
compete effectively in the post-reform marketplace. Their common mantra 
is that status-quo operations are insufficient to meet customer demands 
for higher-value healthcare services. It's not enough to get bigger, 
health companies must also become better. American healthcare may never 
be the same. China on the Rebound

https://econvue.com/pulse/china-rebound

Karim Pakravan

https://econvue.com/experts/karim-pakravan

China's more robust foreign position comes at a time when President Xi 
Jinping is taking a much bolder stance in promoting China as the "other" 
superpower. Furthermore, with the United States under President Trump is 
retreating from its global leadership role, China is positioning itself 
as the guardian of a multilateral-based world order. Data Round-Up: Real 
Consumption Likely Grew a Solid +3.75% in 17Q4

https://econvue.com/reports/michael-lewis/data-round-real-consumption-likely-grew-solid-375-17q4

Michael Lewis

https://econvue.com/experts/michael-lewis

Upward revisions saved the holidays. Even with so-so December sales and 
a rebound in goods inflation to more than +2% annualized in 17Q4 (mostly 
gasoline prices, despite a turn down at the pumps in December), real 
consumption likely grew +3.75% in 17Q4, more than a percent above the 
17Q1-Q3 pace. Note, tax reform bonuses being issued by firms should 
boost early 2018 spending, though history indicates consumers will bank 
much of their windfall. Chicago Rising

https://econvue.com/pulse/chicago-rising

Collin Canright

https://econvue.com/experts/collin-canright

Chicago's FinTech development and investment reputation has been on the 
rise, and we're expecting big things in this city for 2018. Crain's 
Chicago Business suggests that Google is planning

https://fintechrising.us9.list-manage.com/track/click?u=82c52a0b53a861a1cc8630ad0&id=c963e439e4&e=be64b04a10

a major new center here, while city officials remain hopeful that it 
will make the first cut for Amazon's HQ2.

Data Round-Up: Labor Markets Still Look Very Healthy, Will Tighten 
Further in 2018

https://econvue.com/reports/michael-lewis/data-round-labor-markets-still-look-very-healthy-will-tighten-further-2018

Michael Lewis

https://econvue.com/experts/michael-lewis

The December jobs report marked a fairly tepid end for the year. 
Nonetheless, trends point to the labor markets tightening further in 
2018. The FOMC has already decided, we believe, to pause in January, 
Yellen's final meeting. By March, with Powell at the helm, labor market 
and other data should easily justify the next rate hike.

Confronting Complex Multidimensional Security Challenges in Trinidad and 
Tobago

https://econvue.com/pulse/confronting-complex-multidimensional-security-challenges-trinidao-and-tobago

R. Evan Ellis

https://econvue.com/experts/r-evan-ellis

Dr. Ellis' latest report on security challenges facing Trinidad and 
Tobago, two small and relatively unknown nations which have significant 
strategic importance from the perspective of the United States and the 
Western Hemisphere.

2018 ECONVUE PREDICTIONS

https://econvue.com/pulse/econvue-spotlight-econvue-predictions

Highlights of the more non-intuitive analysis of our experts

https://www.econvue.com/experts

on their forecasts for 2018.

The Year in FinTech 2017 to 2018

https://econvue.com/pulse/year-fintech-2017-2018

Collin Canright

https://econvue.com/experts/collin-canright

FMI January 2018 Economic &amp; Investment Outlook

https://econvue.com/reports/michael-lewis/fmi-january-2018-economic-investment-outlook

Michael Lewis

https://econvue.com/experts/michael-lewis

The Year of the Dictators

https://econvue.com/pulse/year-dictators

Robert Madsen

https://econvue.com/experts/robert-madsen

The Key Challenge and Issue for the United States in 2018 is Donald 
Trump

https://econvue.com/pulse/key-challenge-and-issue-united-states-2018-donald-trump

Robert Shapiro

https://econvue.com/experts/robert-shapiro

2018 Global Outlook

https://econvue.com/pulse/2018-global-outlook

Nikolai Tagarov

https://econvue.com/experts/nikolai-tagarov

Whither the US in 2018? US and the Americas and Globally

https://econvue.com/pulse/whither-us-2018-us-and-americas-and-globally

Marsha Vande Berg

https://econvue.com/experts/marsha-vande-berg

STORIES IN OUR SPOTLIGHT Productivity & Labor The "Quiet Life" 
Hypothesis Is Real: Managers Will Put Off Hard Decisions If They Can

https://hbr.org/2018/01/the-quiet-life-hypothesis-is-real-managers-will-put-off-hard-decisions-if-they-can

Kotaro Inoue 1/9/2018 Harvard Business Review As our New Year's 
resolutions fade away, an intriguing study just published in the Harvard 
Business review. Managers, and people in general, are likely to put off 
hard decisions and hard work, preferring the "quiet life." Competition 
is the cure. Automation and Jobs: When technology boosts employment

https://t.co/C6KdlhjD8q

James Bessen November 2017 Boston University School of Law A 
thought-provoking paper from the American Economics Assoc meeting in 
Philadelphia this weekend. Does productivity have and an end game in 
terms of jobs, and are we there yet? How Widespread Is Labor Monopsony? 
Some New Results Suggest It's Pervasive.

http://rooseveltinstitute.org/how-widespread-labor-monopsony-some-new-results-suggest-its-pervasive/

Marshall Steinbaum 12/18/2017 Roosevelt Institute

Or do large firms offer non-wage benefits that employees take into 
account on a rational rather than coercive basis? Illinois Saw Net Loss 
of 101,000 People to Neighboring States Since 2010&nbsp;

https://www.illinoispolicy.org/irs-illinois-saw-net-loss-of-101000-people-to-neighboring-states-since-2010/

Vincent Caruso 1/10/2018 Illinoispolicy.org Since this outflow number is 
only for neighboring states, in effect metro Chicago, it clearly 
demonstrates the effects of laws and policy on residential choice. 
Neighboring towns in Indiana and Wisconsin don't have different 
climates, or a significantly different economic base. Fintech Bitcoin 
could be adding 0.3% to Japanese GDP

http://www.businessinsider.com/bitcoin-could-be-adding-03-to-japanese-gdp-2017-12?r=UK&IR=T

Jim Edwards 1/1/2018 Business Insider

Cryptocurrencies are beginning to have an effect on the real economy. 
One Bank Is Unsure If Any Humans Still Trade Stocks In Japan, Or Have 
All Moved To Bitcoin

https://www.zerohedge.com/news/2017-12-26/one-bank-unsure-if-any-humans-still-trade-stocks-japan-or-have-all-moved-bitcoin

Tyler Durden 12/26/2017 Zero Hedge 40% of cryptocurrency trading is 
Yen-denominated. Are Japanese housewives driving bitcoin? How a Bitcoin 
System is Like and Unlike a Gold Standard

https://www.alt-m.org/2018/01/11/how-a-bitcoin-system-is-like-and-unlike-a-gold-standard/

Larry White 1/11/2018 Alt-M.org Blockchains Use Massive Amounts of 
Energy—But There's a Plan to Fix That

https://www.technologyreview.com/s/609480/bitcoin-uses-massive-amounts-of-energybut-theres-a-plan-to-fix-it/

Mike Orcutt 11/16/2017 MIT Technology Review

Terrific explanation of why mining for cryptocurrencies uses so much 
energy, and what mining actually is. Here's the one currency worse for 
the environment than bitcoin

https://www.marketwatch.com/story/at-last-a-comparison-where-bitcoin-comes-out-environmentally-friendlier-2017-12-06?mod=MW_story_latest_news&link=sfmw_tw

Steve Goldstein 12/7/2017 Market Watch

Yes, creating 1.2 million pennies is worse for the environment than 
mining a bitcoin. 95 Crypto Theses for&nbsp;2018

https://medium.com/@twobitidiot/95-crypto-theses-for-2018-ca7b74f8abcf

Ryan Selkis 1/2/2018 Medium

Great write up-a must read on cryptocurrencies. Beyond Price: Bitcoin's 
impact on the future

https://www.youtube.com/watch?v=rvwVbRQ5Ysc&app=desktop

Andreas Antonopoulos 12/23/2017 YouTube Video PayPal only operates in 19 
countries. Imagine an internet of money with no boundaries, and 
companies like PayPal disintermediated: video with industry guru Andreas 
Antonopoulos. ECB Official Calls for Tax on Bitcoin Transactions

https://www.coindesk.com/ecb-official-calls-for-tax-on-bitcoin-transactions/?utm_content=buffer2a497&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Nikhilesh De 1/3/2018 Coin Desk Of course they did. The VERY simple bear 
case for&nbsp;bitcoin

https://blog.goodaudience.com/the-very-simple-bear-case-for-bitcoin-7f3a5d2953ba

Savneet Singh, Tera Holdings 12/17/2017 Most Bitcoin Exchanges Start 
Refusing New Investors

https://cryptona.co/bitcoin-exchanges-start-refusing-new-investors/

Timothy Olagoke 12/27/2017 Cryptona While bitcoin exchanges upgrade 
their systems, they are refusing new customers. In 2018 they will create 
more capacity to meet this demand. The Criminal Underworld Is Dropping 
Bitcoin for Another Currency

https://www.bloomberg.com/news/articles/2018-01-02/criminal-underworld-is-dropping-bitcoin-for-another-currency

Olga Kharif 1/2/2018 Bloomberg Criminals are by definition 
unintelligent. Bitcoin can't be and never has been hacked. World 18 
Exponential Changes We Can Expect in the Year Ahead

https://www.technologyreview.com/s/609868/18-exponential-changes-we-can-expect-in-the-year-ahead/

Azeem Azhar 12/31/2017 MIT Technology Review

On annual forecasts-absolutely true that we overestimate what can happen 
over one year, and underestimate what can be accomplished in ten. Self 
driving electric cars for example won't be the norm in 2018, but by 2028 
they will be ubiquitous. Interview with Anne Case

https://minneapolisfed.org/publications/the-region/interview-with-anne-case

Douglas Clement 12/12/2017 Federal Reserve Bank of Minneapolis

An extraordinary mind on why there are so few women in economics. Can 
secular stagnation morph into secular expansion?

https://www.ft.com/content/38fbdf1a-678d-3c92-8df0-9ee5ba890fae

Avyn Davies 1/7/2018 Financial Times A slight uptick in productivity, 
and signs are hopeful that the broad global expansion we are now 
enjoying will continue in 2018. The known unknown-will rising interest 
rates dampen growth? The Marxist Case for the Nintendo Switch

http://theweek.com/articles/747291/marxist-case-nintendo-switch

Ryan Cooper 1/9/2018 The Week Nintendo trusted their rational analysis 
of their customer base rather than blindly trusting market outcomes — 
and it paid off. US Consumer Credit&nbsp;

https://www.federalreserve.gov/releases/g19/current/default.htm

Federal Reserve 1/8/2018 In November, consumer credit increased at a 
seasonally adjusted annual rate of 8-3/4 percent. Revolving credit 
increased at an annual rate of 13-1/4 percent, while non-revolving 
credit increased at an annual rate of 7-1/4 percent. Kicking the can 
down the road...

America's ‘Retail Apocalypse' Is Really Just Beginning

https://www.bloomberg.com/graphics/2017-retail-debt/

Matt Townsend, Jenny Surane, Emma Orr, Christopher Cannon 11/8/2017 
Bloomberg

Just $100 million of high-yield retail borrowings were set to mature in 
2017, but that will increase to $1.9 billion in 2018. From 2012-2025, it 
will balloon to an annual average of almost $5 billion. Consumer debt 
rising, confidence falling. Neat results from Emi Nakamura. Why didn't 
aggregate consumption-housing wealth elasticity change over fin. crisis?

https://twitter.com/1EquationShort/status/949632979650965504

Ethan Feilich @1EquationShort 1/6/2018

Recovery has been uneven. For households with underwater mortgages, it 
is like driving with a flat tire down a road without a shoulder and no 
off ramp. Asia China Is Heaping Debt on Its Least Productive Companies

https://www.cfr.org/blog/china-heaping-debt-its-least-productive-companies?sp_mid=55747132&sp_rid=YnN0ZWlsQGNmci5vcmcS1

Council on Foreign Relations 1/11/2018 Loans are given to unproductive 
Chinese firms in lieu of of allowing the market to enforce needed 
structural changes. This misallocation of capital could be more onerous 
over the long run than the risk of rising debt. The global decline of 
extreme poverty – was it only China?

https://ourworldindata.org/the-global-decline-of-extreme-poverty-was-it-only-china/

Max Roser 3/7/2017 Our World in Data In a word, no. The decline in 
extreme poverty is worldwide. Rising Japan inflation: a possible shock

https://www.omfif.org/analysis/commentary/2018/january/rising-japan-inflation-a-possible-shock/

Akinari Horii 1/8/2018 In defense of the Philip's Curve by former Bank 
of Japan official Akinari Horii, who says rising Japanese inflation 
could surprise in 2018 due to labor constraints. But what about 
automation? China's debt trap diplomacy

https://www.project-syndicate.org/commentary/china-one-belt-one-road-loans-debt-by-brahma-chellaney-2017-01/english?barrier=accessreg

Brahma Chellaney 1/23/2017 Project Syndicate Worth another read based on 
recent events, in case you find any aspect of the China's One Belt One 
Road initiative troubling. How people in Asia-Pacific view China

http://www.pewresearch.org/fact-tank/2017/10/16/how-people-in-asia-pacific-view-china/?utm_content=bufferc8525&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Laura Silver 10/16/2017 Pew Research Center

I would like to see a similar poll for views on the US impact in Asia 
for comparison purposes. These results will surprise the myriad of 
commentators focused on the China is replacing the US story. USDX and 
USDCNY

https://twitter.com/BaldingsWorld/status/950971656624750592

Comrade Balding 1/9/2018 @baldingsworld How anyone can claim that CNY is 
not still effectively pegged to the USD is beyond me.

With all best wishes,

Lyric Hughes Hale

Editor-in-Chief

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