Tag: economics

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Weapons and trade

The 21st century demonstrates again the direct power of weapons and the indirect power of trade. In 2026-10 we experience the use of both as a force in international politics. Big as well as smaller powers push for the weaponization of trade as part of the overall arsenal of weapons. Rare earths, microchips, oil again, all serve to coerce nations into more lenient behavior. Welcome to the era of behavioral strategies in international politics. The revival of game theories and multiple applications in those markets or policy domains seems inevitable. Only the rational part of the behavioral strategies has changed to include higher stakes into the loss function of loosing a (repeated) game. States gamble not only in specific policy domains, but they raise the stakes even to their own survival. Populations of such states become hostage to the ruling elite and have hardly any exit possibilities from disaster. As nutrition and public infrastructures have become targets and weaponized as well. Modern warfare has entered an even more harmful phase on the global level. (blog entry inspired by Victor d. Cha, China’s weaponization of trade, 2026). 

power display of DragonBall characters 2026-11
power display of DragonBall characters 2026-11
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swop Credit default swops

Credit default swops (CDS) are popular again in the financial markets. Taking insurance against the risk of AI-giants, unused data centers or chipmakers defaulting on their massive debts has been on top of the agenda in the Financial Times on 2026-10-21. The last time a similar run on CDS happened was related to the bank, then much bigger financial crisis about 20 years ago. Remember those days “Too big to fail” and the huge bill put on governments and tax payers subsequently. The drop on Wall street on Thursday 29th and Friday 30-10-2026 send shivers through the financial markets. There seems to be the opinion that we have witnessed the peak of the AI-hype towards the end of October 2026. In the New York Times (2026-10) there was already an article which advocated that if the AI technology is not viable as a private enterprise, it should be nationalized to guard against abuses and make sure the military applications could continue to be exploited at full potential as other superpowers might equally do so.
We all heard or read the warnings about the riskiness of such investments even when hedged through CDSs, it is about time to return to investments that do not primarily build on other people’s intellectual property. 

credit-default-swops-swoped-2026-11

credit-default-swops-swoped-2026-11
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Forecasting error

In the October 17th edition of The New Scientist we learn about the long time series of events related to of El Niño and El Niña. These series of linked events make forecasting of what is to be expected in 2026-2027 less error bound. Monthly or bimonthly forecasts across the globe can actually predict droughts and floods quite well except the precise geolocations in a country or region. As a consequence crops will suffer and countries with little provision of stocks or purchasing power shall suffer the most. We have about 6 months left to prepare for such events as a global community. Rather than continue to pile on additional risks for the planet we have to address the root problems of CO2 emissions urgently, all of us. 

Berlin Wannsee weather forecast 2026-8
Berlin Wannsee weather forecast 2026-8

 

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Splendid Isolation Iceland

In international politics the term “splendid isolation” refers to the British diplomacy of the 19th century to keep Great Britain out of the power struggles across Europe and as a separate force. Maybe the Brexit in the 21st century can be figured in terms of  a return to the ideal of a splendid isolation, despite the close economic links and joint democratic heritage since the 2WW.
Iceland had a referendum on opening EU-accession talks which it dismissed by 53% against to 47% in favor. As with the Brexit vote, countries rarely vote similar in all regions. Therefore, it is no surprise that an even larger majority of the population of Reykjavik voted in favor, but the 2/3 of the population living in rural areas, many related to the fishing industries, rejected the prospects of EU-integration. As a member of the EEA Iceland is already part of the more economic aspects of the EU, but a strong isolationist and independent diplomatic stance dominated. Sometimes it takes a generational change before the prospects for younger generations are taken into account in politics.

splendid-isolation-in-Paris-2026-10
splendid-isolation-in-Paris-2026-10
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Queue to learn

The protests of students in France has been biased by reports on the violence by people who looted shops. The broadly unmatched learning ambitions of students has entered little into the reporting. In the 2 weeks after the protest students flocked to public libraries to learn in decent conditions. Nowadays, this includes access to fast internet and other sources of inspiration depending on interests. Researchers who were the primary users of the BNF have been outnumbered by advanced pupils and students ready to queue for 1 hour to catch a place even sitting on floors. This brings back the time of the baby boomers who entered with large birth cohorts into high schools and universities later on. Such social trends are predictable and adequate policy responses not even extremely expensive. Until education institutions are expanded there will be queues to learn. 

BNF queues to learn 2026-10-26
BNF queues to learn 2026-10-26
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Rural urban interrelationship

Cities are no isolated microcosms. They rely on being delivered a huge range of products. Cities have been markets, hubs or platforms for exchange with their surroundings, neighboring communities as well as distant ones. Historically, quite many cities have built walls to limit access and strictly regulated access. In the 21st century with low levels of fertility, the demographic pressure to leave the countryside for jobs is less pressing, but many regions face the shrinkage of the countryside’s population. The interrelationship between the urban centers and the rural surroundings has to be studied and addressed due to the far-reaching consequences for both. Transportation into cities needs public infrastructure which can handle the necessary flows and exchanges of people and products. For too many decades we have focused on an either/or cleavage of an apparent dichotomy of urban versus rural. It is about time to correct this bias and take the rural-urban interdependence more systematically into account. 

uri urban rural interrelationship in food and drink

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Productive organizational energy

Productive organizational energy is more than the sum of individual efforts. Only if you manage to align the productivity of all employees and managers towards the same objectives, you are likely to reap the full benefits of productive organizational energy. The scientific literature is quite clear in this regard. The authors Vogel, Raes and Bruch (2026) highlighted the need to investigate current as well as anticipated Productive organizational energy using a tool called the “energy pattern explorer”. Through the repeated measurement it is possible to learn about trajectories which can be related to leadership styles, external and internal influences as well as to evaluate detailed leadership activities in more detail. Once in office, many leaders no longer deem it necessary to check or evaluate their decision-making processes, although the baseline measures should be taken at that time or before departure of the previous chief executive. About time to take productive organizational energy seriously to mobilize the energy of the many rather than the usual one man show.

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Long run

The future orientation is a principal component of any investment. If a society stops investing its impeding its own ability to adapt and grow. Investment costs today will likely generate returns in the medium or long run. A caveat applies. Some investments may cause long running liabilities, like nuclear energy. The choice of which investment to choose, therefore, is crucial. The investment in people is likely to have a positive return in the long run because it remains an investment that has a high potential to adapt to changing circumstances rapidly. Training as scientist allows to do both fundamental research or to choose an applied field with little reorientation. A focus on the long run has advantages of likely stable returns if previous forecasts in what to invest were correct and reliable. This is the point where besides the difficulty to make good (technological) choices, probabilities enter the equation. The longer the time horizon, the greater the probability that relevant changes, which impact the future returns, shall occur. At best, some of these may cancel out each other in the long run. The potential that some risks are “too big to fail” does not mean that shall not occur (zero probability does not exist in technical nor human decisions. A sound theory of social investment would be a great step ahead for humanity in the 21st century. (Image: Ostend street art 2026-6) 

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Marilyn Monroe TM

The image and probably even the person of Marilyn Monroe has become a trademark of its own. Since the choice to change her name and outlook to become or be created as the objectified trademark of Marilyn Monroe, the financial interests to gain money using every image, sound or video have reached above average returns. The profits mostly accrue to those owning the commercial rights. At the occasion of her 100th birthday, this continued rent seeking keeps spinning.
It has been well documented that the early death at just 36 years of age is linked to her exploitation or “commodification” as a trademark rather than a person able to cope with the overloaded imagery of herself. Bookshops, even in 2026-6, decorate their windows with books with her image on the cover as eye catcher. As with few other persons, Marilyn Monroe stands for an objectified person where the property rights of the image keep being exploited long after her tragic death. (Image: Marilyn Monroe, tramage by Bruno James BdF, left and algorithmic on the right. Transbordeur 2026).

 

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Litfaß Advertisement Column

Berlin has renovated some of its early say notice boards and advertising columns. The original „Litfaßsäule“ has already the round column shape where you clued a poster on the sirface so that it was visible to several persons interested to look and read. After more than 150 years after its invention, Berlin has digital advertising columns which resemble the original Litfaß design. Rather than the spectator walking around the column, the column now turns around in a steady manner so that nearby you can see the whole advertising content from all points in the neighborhood. Simple change, but a remarkable improvement in the reach of the advertisement. Retro-lighting increases the duration of the effects as well. Mass communication and commercial innovation can sometimes just improve on an existing marketing channel, and still reach a specifically targeted audience.