1. Economic
8. These Are the Best Countries to Live and Work in—And to
Boost Your Salary
Moving abroad boosts the average worker’s income by $21,000,
with the best-paid staff found in Switzerland, the U.S. and Hong Kong. That’s
the conclusion in a survey showing that 45 percent of expats said their
existing job paid more internationally and 28 percent changed locations for a
promotion. In Switzerland, famous for both sky-high mountains and prices, the
annual income boost totaled $61,000. Expat salaries there averaged $203,000 per
year — twice the global level.
In HSBC’s annual Expat Explorer, Singapore topped the ranking
as best place to live and work for a fourth straight year, beating New Zealand,
Germany and Canada. Switzerland ranked only eighth, with the high cost of
raising children and difficulty making friends going against it. “Singapore
packs everything a budding expat could want into one of the world’s smallest territories,”
said John Goddard, head of HSBC Expat. Sweden, one of the world’s most
gender-equal countries, got top billing for family, while New Zealand, Spain
and Taiwan led the way in the experience category.
Despite the cultural, financial and professional advantages
of moving abroad, the survey of 22,318 people uncovered that women trailed on a
variety of metrics.
While relocating boosted women’s income by roughly 27 percent
— topping the increase experienced by men — only about a quarter moved to develop
their careers, compared with 47 percent of their male counterparts. Just half
worked full time, and the overall level of education was somewhat lower.
Women’s average annual salary was also $42,000 lower than men’s.
(Source: Bloomberg – By
Catherine Bosley, 11 October 2018)
9. Rupee has slipped way too much and needs to be reined in
The oldest trick in the high school debater’s book is to make
the opponents’ propositions appear so risible that the judges are left
wondering whether the debate should be taking place at all. Some of the
defenders of unchecked depreciation of the rupee have adopted this tack. They
claim, for instance, that the case for a more managed currency is based on the
perception that the rupee is a symbol of ‘national pride’. I am, however, yet
to find any evidence of this uber-nationalism among economists who ask for
closer currency control.
Others have defended depreciation as a process of the
currency ‘finding its own level’ and cautioned against meddling too much in the
natural order of things. To me, this dogma in its most extreme could involve
gross oversimplification and misreading of the forces and mechanisms that drive
the rupee. The public debate on the rupee is not a high school competition, and
the arguments for and against a more active management have to rise above
adolescent tactics of point-scoring. So, let’s have a more meaningful
conversation.
Time for Practicals
Of the myriad things that make a currency market different
from an elementary textbook model (where demand and supply curves dutifully
intersect and price finds its own level), the one that needs to be emphasised
is the role of expectations in influencing market participant behaviour.
Throw in active speculation on the rupee in the offshore
non-deliverable forwards (NDF) market (any forex trader would corroborate its
massive influence on local rates), and you have a situation where bets on the
future hold the key to the rupee’s trajectory. So, any meaningful debate on a
‘hands-off ’ strategy must address the following questions. Does the free play
of forces in such a complex market bring the rupee close to a ‘desirable’
level? Or does it instead breed expectations that can take the currency further
and further away from it?
Should we try instead to manage these expectations to bring
the currency closer to this desirable level? What happens to the cost of
servicing external debt with this large depreciation? What is the future of the
nascent corporate debt market if overseas investors sense that policymakers are
indifferent to the future of the currency even in the throes of acrisis? Is our
domestic financial system with its problems of stressed assets and capital
shortage adequate to fund our growth needs? Let me add a couple of more
queries. How quickly can the current account compress on the back of rapid
depreciation?
Let’s take a recent
example from our neighbourhood. In the first bout of depreciation of emerging
market currencies that started in March this year, the Philippines Central Bank
chose to let the market guide its currency, the peso.
The result: high inflation without any noticeable rise in
exports that ultimately forced four policy rate hikes in quick succession. Are
we letting ourselves into the same trap by ignoring strong input price
inflation led by oil prices simply because food prices are soft?
The issue of the current account brings me to the point that
the ‘free depreciators’ champion: the overvaluation of the rupee. Yes, going by
simple real effective exchange rate (REER) measures, the rupee would have to
fall to around 72 or 73 to the dollar to correct for overvaluation. But is the
simple REER — which focuses entirely on trade competitiveness — necessarily be
the best measure of fair value?
REERing its Head
Let’s face the fact. We will continue to have a current
account deficit (CAD) if we have an economy where domestic demand is the
principal driver. That’s not necessarily a bad thing, but it means that we need
to get foreign capital to fund it.
If the capital account does matter, should the fairness
metric focus on trade alone? Don’t we, in the process of chasing trade
competitiveness, risk the possibility of chasing capital away? Instead,
shouldn’t the valuation measure bring balance trade (or current) account
competitiveness with capital account ‘attractiveness’? Fortunately, we don’t
really need a Nobel Prize-winning research breakthrough for this.
The textbook prescription of adjusting REER by productivity
differentials (usually proxied by per-capita GDP) does the trick. It partly
reduces the impact of higher inflation in India more than its trading partners
do by factoring in India’s growth advantage over its trading partners or
competitors. It might be good to remind ourselves that higher growth (usually
associated with higher interest rates) remains somewhat the strongest magnet
for capital. The adjusted REER would show a fair value of a little less than
Rs. 70 to the dollar. Going by this, the rupee has indeed slipped excessively
much and needs to be reined in.
I lay no claim to have the correct answers to the many
questions I have raised here. Perhaps a freer float for the rupee is the best
way forward. However, I am sanguine about a couple of things. Money will get
even tighter in the global financial system.
There is a vicious trade war between two global superpowers,
and the oil market is in the fragile balance. So, it would be risky to assume
that the recent respite in the rupee’s fall will last. Secondly, I need
convincing answers to some of my queries to switch sides. That, I hope, is a
fair demand
(Source: Economic Times, 24 October 2018)
2. Business
10. Facebook News: After Oculus Co-Founder Departs, Company
Says New Oculus Rift Still Coming
Facebook drew headlines on 22 October 2018 when Brian Iribe,
the co-founder and former CEO of Oculus VR, announced his departure from the
social media giant. The news was also accompanied by reports that Iribe left
because Facebook canceled an upcoming successor to the Oculus Rift headset,
which Facebook has denied, according to TechCrunch.
Iribe’s exit was announced in a Facebook post, which included
his intent to “recharge, reflect and be creative.” However, TechCrunch reported
that Facebook’s cancelation of the so-called Oculus Rift 2 may have played a
part in his decision. In response, Facebook told TechCrunch that there will be
another version of the Rift headset.
“While we can’t comment on our product roadmap specifics, we
do have future plans, and can confirm that we are planning for a future version
of Rift,” Facebook’s statement said.
Oculus makes a few different VR headsets. Rift was the
original, and is still the most expensive, as it must be wired to a high-end
gaming PC to function. In return, it can play the widest variety of VR
experiences. Oculus Go and the recently announced Oculus Quest are wireless and
cheaper, but do not support as many applications.It is possible the specific
Rift follow-up Iribe worked on was indeed canceled, but Facebook still plans to
support the higher end of the Oculus lineup down the road.
Iribe would not be the first founder of an acquired property
to leave Facebook after reports of internal tension. Instagram co-founders Mike
Krieger and Kevin Systrom left Facebook at the end of September, and reports
indicated there were disagreements between them and Facebook executives about
the future of Instagram.
WhatsApp co-founders Brian Acton and Jan Koum also left the
company in 2017 and 2018, respectively. Acton recently admitted to
disagreements with Facebook about the monetisation of WhatsApp.
(Source: International Business Times – By Alex Perry, 23
October 2018)
