I’m reminding you that access is free : QB lecture room, every Monday from 4 to 6 P.M., Pleinlaan, 1050 Brussels.
My intervention is part of the filmed account of the session on the Parliament’s own TV channel.
“The future of the Eurozone from an interest rate standpoint”, European Parliament, November 5, 2013
Here my contribution to European Parliament, Committee on Economic and Monetary Affairs, November 5, 2013, 3:30 to 6:30 p.m.
The future of the Eurozone can be approached as a logical problem. If not solved, it can at least be significantly clarified when the issue is examined from the single standpoint of the sovereign debt’s coupon for the nations belonging to the zone.
Within the economic zone where a currency applies, a single coupon level only should be in existence for each obligatory maturity. The founding fathers of the Eurozone assumed no doubt that such would be the case also for the zone – or at least would tend to become so on the long run. They did not envisage that measurable default risk would develop for individual member nations of the zone, neither of course that reverting to the old currency would ever be considered an option. The fact that for a single maturity coupons vary according to country within the Eurozone is as such an alarming symptom of its current troubles.
European Parliament, Committee on Economic and Monetary Affairs, November 5, 2013, 3:30 to 6:30 p.m.
I will be the first speaker at 3:30 p.m.
The full programme can be found here.
My “Stewardship of Finance” lectures at the VUB resume on September 30.
Lectures will be delivered in English, they are held on Mondays from 4 to 6 p.m. in lecture hall QB (2 Pleinlaan, 1050 Brussels); auditors are free to attend.
Lectures are videotaped and can be viewed on YouTube as well as here on the blog.
1. Why stewardship of finance?, September 30
2. Is rational behaviour necessarily ethical?, October 7
3. Regulation and self-regulation. Adam Smith’s “invisible hand”, October 14
4. Law, Ethics and the business world, October 28
5. The business world and its regulators, November 4
6. National order and international disorder. Tax havens/shadow banking/mafias, November 18
7. Lord Adair Turner: socially useful and socially useless financial activities, November 25
8. Profit and Ethics. Aristotle’s chrematistics, December 2
“Stewardship of Finance” lectures will be held in French at the ULB (Université Libre de Bruxelles) during the second semester, their programme will be communicated in due time.
A mail exchange about JP Morgan’s “The Euro area adjustment: about halfway there”, Europe Economic Research, 28 May 2013
From : Paul Jorion
Object : The Euro area adjustment: about halfway there
Date : 21 June 2013 21:33:20 UTC+02:00
To : Malcolm Barr, David Mackie
Good day MM. Barr and Mackie,
I’m writing to you as I receive several mails drawing my attention to the following paragraph of your recent May report:
“The political systems in the periphery were established in the aftermath of dictatorship, and were defined by that experience. Constitutions tend to show a strong socialist influence, reflecting the political strength that left wing parties gained after the defeat of fascism. Political systems around the periphery typically display several of the following features: weak executives; weak central states relative to regions; constitutional protection of labor rights; consensus building systems which foster political clientalism; and the right to protest if unwelcome changes are made to the political status quo. The shortcomings of this political legacy have been revealed by the crisis.”
The authors of the mails I receive are under the impression that this paragraph means that you regard “constitutional protection of labor rights” and “the right to protest if unwelcome changes are made to the political status quo” as detrimental to business. There is however a wide consensus in the community that such principles are basic to democracy.
Would you be so kind as to dispel any doubts about this, so that I can reply to the mails I received?
Should I not receive any reply from you, I would conclude that you, Gentlemen, do indeed regard some basic democratic principles as detrimental to business, and mention that fact on my blog for the education of the public.
From : David Mackie
Object : Rép : The Euro area adjustment: about halfway there
Date : 23 June 2013 14:39:56 UTC+02:00
To : Paul Jorion
Thank you for your email.
The paragraph that you refer to is not intended to suggest that there is a clash between democracy and business and, in any case, we do not believe that to be the case. Rather, the paragraph is intended to be about the functioning of EMU.
There are many ways that EMU can be constructed. One of the key trade offs is between regional burden sharing and national level flexibility.
In principle, the region can choose any point on this trade off. For now, the region is moving towards a point on this trade off which involves a very modest amount of regional burden sharing and a lot of national level flexibility.
Against this background, some countries are struggling to make the adjustments required by this particular vision of EMU.
I hope this clarifies the point we were trying to make.
N. B. : Published with Mr. Mackie’s full approval.
VUB and ULB, “Stewardship of Finance” chair, Prince Philip and Princess Mathilda of Belgium ask students about their research, Avril 18 2013
Well, call me sentimental, but in a world of confrontation, disarray and dearth of proper answers, the whole occasion was, please forgive me for being so blunt, perfect.
“What Can We Tell about the Future?” was my final lecture at the Stewardship of Finance chair in the academic year 2012-2013. The lecture was held in English as had been the case with prior ones. Most questions which then came from the room were in French, I answered them in the same tongue.
As a supplement, with yours truly in a somewhat unusual capacity, for the final session taking place on the following day on April 18, students made presentations of their work to Prince Philip and to Princess Mathilda of Belgium.
Here the podcast only of my own lecture:
(Many thanks to Manu Berquin!)
I’ve just heard from Jacques Attali who is currently in Shanghai that he will need to be in New York on Thursday morning. This will make it impossible for him to give the lecture planned at the VUB on Wednesday April 17. I’m sure this will be especially disappointing for those of you for whom it was their second attempt at attending his talk.
The scheduled plan was that I would be giving the second part of the talk, I will thus give it all. I’ll be speaking on the arranged topic: “What can we tell about the future?” and I will explain why the future is particularly unpredictable for those few who, as is the case with Jacques Attali, hold a clearer view than most about where precisely we’re heading.
Hoping to see you in any case on Wednesday at 6:30 pm at the VUB in the Promotie Hall, building D, 2 Pleinlaan, 1050 Brussels.
On the 18th of April will come to an end the first year of my teaching about the “Stewardship of Finance” at the VUB (Vrije Universiteit Brussel). The videos of my lectures can all be viewed here on this blog and the full set can be accessed here.
I’m currently writing up my lectures under book form in the language they were held in i.e. English. My (excellent) French publishers do not publish in that tongue. Interested English-speaking publishers may get in touch with me here.
The fourteenth lecture of the course about on speculation. Pro (LoL) and contra.
The author whose name I unfortunately don’t remember during the lecture: Donald MacKenzie, An Engine, Not a Camera. How Financial Models Shape Markets, Cambridge (Mass.) : MIT Press 2006
The thirteenth lecture on ethical ways of sharing newly created wealth. The situation in Cyprus served as an illustration.
The world in which we live today increasingly resembles a science fiction film from the 1950s. Some of those films were excellent because they raised fundamental questions about how machines seize power. Put more simply, they explored how the invasion of the machines–an invasion we have actively fostered for several centuries–leads us to lose control of the world. The film 2001, A Space Odyssey (1968) culminates in a battle: the machine that is really in charge of the mission―and knows how to carry it out―is pitted against the human crew member whom the machine has been programmed to sacrifice. Incapable even of imagining that he is not in command, the human is led by his arrogance to fight back and eventually to escape, although the nature of his salvation turns out to be quite problematic.
Today’s financial markets are the prey of robots that fight their duels in computerized space. This is the result of high-frequency trading algorithms, or algos. Of course there are programmers behind these algos, who write the software and can evaluate its effects at day’s end, fine-tuning when necessary and adding improvements and innovations. Nevertheless, and this is just like neural networks and genetic algorithms (whose inner workings are impenetrable to human perception), certain machine-learning techniques produce highly autonomous behavior in algos as long as they remain in operation. The upshot of this is that the “Skynet effect,” as we have come to call it, is now in play. This is a reference to the omnipotent computer network featured in the Terminator series. In those films, human beings no longer have a role except in a broader context where major decisions are all really made by a confederation of computers.
We must ask ourselves today with the utmost seriousness whether we still have control of computers and robots (other than having the power to flip the “Off” switch, of course). If not, what do we need to do to get it back?
Since this post was written, its object was illustrated in the graphic novel La survie de l’espèce (Futuropolis 2012) by Gregory Maklès and myself.
Twelfth lecture of the « Stewardship of Finance » chair. It is the notion of risk and the different forms of risk sharing which allow the building of a reasoned catalogue of all types of financial instruments and analysing them in an ethical perspective.
Is it admissible that taxpayers were required not only to pay for all the losses due to defaulting borrowers but also for all the bets between financiers which turned sour (a larger amount by a factor of ten)?
The eleventh lecture of the « Stewardship of Finance » Chair, devoted entirely to the tragic story of the Texan corporation called Enron which was the topic of my book Investing in a Post-Enron World (2003).
« Dédicace too big to … »
Have you heard of “too big to fail !”?
Now they say “too big to jail !”
They know they have the whole power
Because they finance the lawyer!
They don’t care about Justice
Nor about the State Police
They have put the money somewhere
But no one can really know where!
They only want to be The Boss
And let the others share the loss
They will be away if the war
Starts at the corner or next door!
They act as the worst parasites
Because they have more than 2 seats
And they look for good protection
Even with weapons in action!
Are they part of Humanity
Or just dealers in the city?
Can their children say anything
Else than “Bring me here everything!”?
Signature : luami CREER
« Un médiateur d’ l’innovation
Qui allie raison et passion
Pour mieux vivre le temps restant
Et en partager les instants ! »
For registration, precise location and times, please look here.
On March 7th, my lecture will be devoted to the Enron corporation and its downfall as a counter-example of stewardship of finance.
On March 13, Jacques Attali will be our guest. He is head of Pla-Net Finance and of the study group on a positive economy (of which I have the privilege of being a member). He will answer the question “Peut-on théoriser l’avenir ?”
On the following day, on March 14th, I will be discussing “Financial instruments in an ethical perspective”, with an extensive review of those which are at the centre of the current crisis: Credit-Default Swaps, Asset-Backed Securities, Collateralised Debt Obligations and synthetic CDOs.
On the 20th and the 21st of March will be held a three-part, two-day, event dedicated to answer “Is there an ethical manner to ensure the redistribution of newly created wealth?”
It will be initiated by European Commissioner for Trade Karel de Gucht on March 20th. On the following day I will deliver my lecture on the same subject, which will be followed by a Panel discussion with distinguished guests: Bruno Colmant (Roland Berger), Hilde Vernaillen (P&V Group), Benoît Verwilghen (CFO and vice-CEO of Ethias) and Benoît Lallemand (Finance Watch), moderated by Steven Rombaut (VRT journalist).
My lecture on March 28th will be devoted to “Speculation. Its causes, consequences, and history”.
On April 17th, I will be talking about “Our species and the planet which hosts it”. Finally on April 18th there will be a private event for our students writing a Master dissertation within the Chair’s framework (on the occasion of which I will deliver the introductory speech).