Noticias

AT A bar called “University” in San Giovanni a Teduccio, a rundown suburb of Naples, two blown-up photos adorn the walls: Albert Einstein and Steve Jobs, founder of Apple. Nelson Ciarravolo, the owner, put them up when the bar opened two years ago, long before the news came that Apple would open its first European iOS (its mobile operating system) developer academy in the district. Locals joke that Mr Jobs’s photo may have gone up more recently. Either way, it signals that Naples has embraced the American tech giant. On October 6th Apple held the opening event for the new academy, which it will run in collaboration with Federico II University, after which the bar is named.

“We go to places nobody thought were possible”, explained Lisa Jackson, vice president of environment, policy and social initiatives at Apple, at the inaugural event. Naples lags far behind northern Italy for transport and digital infrastructure, and criminality is rife. The Camorra, a mafia gang, runs one of the biggest drug-trafficking enterprises in the world from the city. The neighbourhood in which Apple has opened the academy (it is located inside a new campus of Federico II University) used to be more dangerous. “We used to see our friends die on the ground,” recalls Davide Varlese, a cousin of Mr Ciarravolo. But things have improved over the past decade as authorities have…Continue reading

Better reality

AT THE heart of an emerging technology cluster in London’s Shoreditch lies the Stage, a big mixed-use building complex that is being developed by Vanke, a Chinese real-estate company, among a few others. A potential Chinese buyer of one of the flats in its 37-storey residential tower recently had a look around. She went from room to room, observing the furnishings and fittings. She marvelled at the city views from the balcony and peeped inside the refrigerator. There was no need for a flight to London. She toured the property using virtual reality (VR) goggles at Vanke’s global marketing centre in Shanghai.

The use of VR kit is quickly becoming widespread in China’s property industry. Few real-estate firms in other countries are as advanced. China is fast emerging as the world’s most important VR market, thanks to rapid adoption by property firms and by companies in other industries. The prompt take-up is not because Chinese firms make the best VR headsets, which they do not. In fact, the pioneers in cutting-edge hardware are America’s Oculus, which is owned by Facebook, Japan’s Sony, South Korea’s…Continue reading

TO CELEBRATE its 40th birthday, Vinamilk, a big Vietnamese dairy firm, filmed a children’s choir crooning adorably from the helipad of one of the country’s tallest towers. In truth the company hardly needs to sing its own praises. Vinamilk is probably Vietnam’s most familiar consumer brand, and it is widely considered to be the country’s best-run firm. Over a decade its profits have grown by close to one-third each year.

Hence the interest among foreigners in a 9% share to be sold by the government this year—the first tranche in a disposal which should eventually see Vietnam’s communist government give up its entire 45% stake in the firm. It is one of several big companies which the ruling party now promises to part with; two others are the Hanoi and Saigon beer companies, known as Habeco and Sabeco. After years of divesting mainly small slivers of unappealing enterprises, Vietnam is at last offering foreigners a slice of its best assets.

Vinamilk meets much of Vietnam’s daily demand for dairy products, including four-fifths of its condensed milk (most often found lurking sweetly at the bottom of the country’s famous…Continue reading

WHEN Samsung Electronics announced on October 11th that it would discontinue its flagship smartphone, the Galaxy Note 7, one crucial event in the history of the world’s second-biggest technology company by revenues (after Apple) sprang to mind. In 1995 Lee Kun-hee, then its boss, ordered 150,000 mobile phones burned and bulldozed in front of 2,000 weeping employees. Business partners who had received the devices as gifts from him had reported back that they did not work properly.

The South Korean auto-da-fé is said to have helped create a culture of permanent crisis at the firm, which drives employees to work incredibly hard. Now the question is how the ignominious end of the Galaxy Note 7 handset, which some hardware aficionados had called the best “phablet” (or large smartphone) ever made, will change Samsung, which is going through a leadership transition. In the midst of the crisis, the firm announced that Lee Jae-yong, the son of Mr Lee, would join the board of Samsung Electronics later this year, taking another step towards succeeding his father, who two years ago suffered a debilitating heart…Continue reading

IN 1966 a medical journal identified a condition it dubbed “credit-carditis”: lower-back ache, with pain radiating down the leg—caused by a back-pocket wallet stuffed with plastic. Payment cards still inflict pain of a different sort. American merchants paid more than $40 billion to process debit- and credit-card transactions in 2015. Despite a reform by the Federal Reserve in 2011 aimed at reducing these costs, revenue from these so-called “interchange fees” has more than doubled since the financial crisis. Retailers are still in revolt; banks are still resisting. That is not surprising, since they rely on the fees for a large and growing share of their income.

American consumers favour debit and credit cards over cash by more than two to one. But this convenience comes at a cost. The seller is charged a fee for every card purchase: in America, typically 0.5% to 3% of its value. These fees are set by payment-card networks, such as Visa and MasterCard and collected by card issuers, such as Wells Fargo and JPMorgan Chase. Some portion of these fees is borne by consumers, including those who pay by cash, in the form of higher…Continue reading

VISITORS to Lisbon, Portugal’s hilly capital, usually seek its nightlife, its sweet custard tarts (pasteis de nata) or its gothic architecture. But no guidebook could help two visitors on October 10th. The pair of analysts, from Dominion Bond Rating Service (DBRS), a Canadian credit-ratings agency, went to assess the creditworthiness of the Portuguese government.

Markets are waiting anxiously for October 21st, when DBRS will update its rating of Portuguese sovereign debt. Hints from DBRS have been playing havoc with the ten-year bond yield: in August a gloomy comment from Fergus McCormick, DBRS’s chief economist, saw it climb 14 basis points (hundredths of a percentage point). This week, word that DBRS was “totally comfortable” with the government’s fiscal position saw it dip by ten basis points.

This unusual attention to a little-known ratings agency is due to the eligibility rules for the European Central Bank’s (ECB) quantitative-easing scheme. The ECB will buy only sovereign debt that is rated as investment grade by at least one of four approved ratings agencies: Fitch, Moody’s,…Continue reading

ESTATE agents in China, as elsewhere in the world, are normally a smooth-talking, self-assured bunch. But Liu Zhendong, a salesman at a large development in the northern reaches of Shanghai, is afflicted by doubts. He had expected business to be solid and steady this year. Instead, it has been manic, with clients jostling to see show apartments. Some had hoped to wait for the market to cool, but capitulated and bought as prices climbed higher week after week. Flats in the area, the once-rural village of Malu, still dotted with fields and scruffy wholesale food markets, now cost 90% more than a year ago. “It feels a bit like a bubble,” he says.

Mr Liu is in good company. Even the head of the central bank’s research bureau, usually cautious in his choice of language, has said a property bubble must be stopped before it gets too big. House prices have climbed by 16% nationwide over the past year, and double or even triple that in big cities. So in the past two weeks more than 20 municipalities have tried to calm the market down—for example, by requiring higher down-payments or limiting purchases by residents of other cities.

As the past…Continue reading

IF A country’s exchange rate represents international investors’ confidence in its government’s policies, the markets have given Britain the thumbs-down. So far this year, only the Nigerian naira among major currencies has put in a worse performance.

The decline seems to be accelerating. On October 7th the pound fell from $1.26 to $1.18 against the dollar within a few minutes, with one trade reported below $1.14. The shift occurred during Asian trading, when liquidity in sterling is likely to be thinnest. The most likely explanation for the plunge lies in the action of algorithmic trades—computer programs that automatically buy and sell assets, from currencies to commodities. Such programs may be designed to sell when an asset’s price falls below a certain level. These sales can be contagious, with one program’s trades setting off the sell signals of other algorithms.

The most famous “flash crash” occurred on Wall Street in May 2010, when the Dow Jones Industrial Average fell by almost 1,000 points in the middle of a trading day. On that occasion, the market righted itself before drifting lower in subsequent…Continue reading

ECONOMICS can seem a rather bloodless science. In its simplest models, prices elegantly balance supply and demand, magically directing individuals’ pursuit of their own self-interest towards the greater good. In the real world, humans often undermine the greater good by grabbing whatever goodies their position allows them. The best economic theorising grapples with this reality, and brings us closer to understanding the role of power relationships in human interactions. This year’s Nobel prize for economic sciences—awarded to Oliver Hart and Bengt Holmström—celebrates their study of economic power, and the tricky business of harnessing it to useful economic ends.

Behind the dull-sounding “contract theory” for which the two were recognised lies an important truth: that when people want to work together, individual self-interest must be kept under control. For a chef and a restaurant-owner to work together productively, for example, the owner must promise not to use the power he has to change the locks in order to deny the chef his share of future profit. Mr Hart, a British economist working at Harvard University, tackled power dynamics while…Continue reading

IT WAS one of the most spectacular robberies of modern times. In February thieves tried to steal nearly $1 billion from accounts held by Bangladesh Bank, the central bank, at the Federal Reserve Bank of New York. They were thwarted, but only after spiriting away $101m. Since then Bangladesh’s government has twice suppressed the publication of a report into the heist, most recently last month, on the ground that making it public would jeopardise efforts to retrieve from the Philippines $81m that is still missing. Interviews with officials and others in Dhaka lead to an obvious conclusion: the report will almost certainly never be made public.

The investigating panel’s remit was to establish why the central bank kept the theft secret for a month, whether bank officials were involved in it and how to avert a similar heist in future. Mohammed Farashuddin, a former central-bank governor, who led the probe and once advocated its publication, will not comment on its findings. The word in Dhaka is that the report is being buried because it exposed lapses at the central bank and implicated its officials or consultants. The government has consistently…Continue reading