#2 Islam and the Arab Revolutions (April 2nd, 2011)

#2 Islam and the Arab Revolutions (April 2nd, 2011 Full edition)

April 10, 2011 (SUN) 10:30~13:30

At SHIBUYA EXCELSIOR COFFEE

ONO, YAMAGATA, OGAWA

Articles we discussed

[Leaders] Green Revolution

[US] Recycled

[Business] Broken Links

[Finance & Economics] Liquidity and Lottery Ticket

[Finance & Economics] Cash Machines

　　　This week we discussed 3 main topics: Investment approach, Global supply chain, German Politics. The difference from last week is that we focused more on financial articles and we first picked up a political issue of the other country (Germany).

　　　First we focused on “Liquidity and Lottery Tickets” from Finance and economic section. This article says investors have two kinds of tendency when they invest their money to certain assets. One can be called as Lottery tickets preference. Like a person who occasionally bet on horse races and overpay 100-1 outsiders, investors tend to demand higher-volatility but lower long return assets. The other is Liquidity preference that we prefer cash rather than long-term bonds if expected return is the same level. The article says because of these tendencies we humans have, the markets do not work as financial models suggest and we can see these anomalies of this kind for example in carry trade.

　　　Next we moved to “Cash Machine” from finance and “Broken Links” from business. These are different issues but I thought that they are related with each other. First article emphasis on the importance of service industries in economical analysis mentioning that the high share of GDP that comes from services. We discussed how important manufacturing is in developed countries such as Japan. Mr. Ono said it’s not so important nowadays as the article mentioned. I objected to his insistence mentioning that most of the services, which have a high share of GDP, are accompanied with manufacturing. So I insisted manufacturing is a key industry even if the share of itself is not so much compare to services. “Broken Links” is the article that mentions challenging of global supply chains that manufacturing in all over the world is facing on now. If global manufacturers avoid Japan when they make productions, what will happen to Japan? Not only manufacturing itself but also accompanying services such as delivery would be damaged heavily.

　　　Lastly we picked up the political issues from Germany. I myself don’t know so much about German politics but Mr. Yamagata studied when he was in graduate school so he taught us about it. The title of this article “A Green Revolution” is from the name of a political party “The Greens”. German Parties have their unique colors; Black, Red, Green, Yellow and Red again. We followed stances of these parties and corporations with each other.

　　　This week, Mr. Yamagata brought his new Kindle with him. It was so cool so I wanted to get mine from Amazon.com website. (not yet done) Cherry blossoms were at their best and Sakuragaoka in Shibuya was tinged with Sakura pink.