reproduced from Fullermoney: a suggestion that Germany should leave the Euro.

I still think the simplest solution is to get out of the EU. This novel version seems to suggest that all would be well if Germany pulled out of the Euro. It’s just papering over the cracks, I reckon.

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Bloomberg Part 1 – Save Europe: Split the Euro – Here is the opening for the first of two interesting articles from Bloomberg on why the euro should be split:  

On the eve of the American Civil War, Abraham Lincoln famously said that “a house divided cannot stand.” Today, the European Union — committed for decades to the quest for “ever closer union” — must confront an agonizing truth. Lincoln’s maxim must be inverted. For the EU to survive, the euro must divide.   Between the Treaty of Rome in 1957 and the Single European Act in 1986, Europe’s governments brought about the one great peaceful revolution the continent has seen in its long and troubled history. The creation of a single European currency would build on this remarkable success. It was the next vital step to greater unity and prosperity. The economic crisis in southern Europe shows that the euro system, at least in its current form, has instead become a mortal threat to both.   Greece, Spain, Portugal, Italy and Cyprus are trapped in a recession and cannot restore their competitiveness by devaluing their currencies. The euro area’s northern economies have had to join in repeated bailouts and put aside their notions of prudent finance. A vicious circle of resentment and populism in the south and strengthening nationalism in the north is tearing the union apart.   And the crisis isn’t yet abating. France, Europe’s second-largest economy, is now sinking into a grave economic slump. Like the southern countries, it must restore its competitiveness; like them, as part of the euro system, it lacks the means. Because of its size and because of the guiding role it has played in the EU’s development, France, we’ll argue in Part 2 of this article, will be crucial in breaking the vicious circle.   Bloomberg Part 2 – France Must Lead Breakup of Euro – Here is a middle section from Part 2:   For France and for the euro system as a whole, the best strategy is to dismantle the monetary union from the top — via the exit of Germany and the other most competitive countries. Appreciation of the new German currency would improve the deficit countries’ trade balances.

In some cases, debt write-offs would still be necessary, but the scale of reduction and the cost to creditors would be smaller because the monetary dismantling would boost the deficit countries’ growth. The surplus countries would have to recapitalize their banks after losses due to any debt reduction, so exiting the system doesn’t mean abandoning the crisis countries. The difference is that, after the exits, their assistance would help put the deficit countries on a recovery path, whereas the current bailouts lead only to a dead end.   The European Central Bank would have to strive to maintain credibility and trust during any controlled dismantling of the euro system. The ECB could be preserved, at least for some time, as the central bank responsible for monetary policy in all 17 member countries, even after some had replaced the euro with new currencies.   This would facilitate strong policy coordination among the former members and demonstrate that the segmentation was an orderly transformation carried out under the control of the most respected and credible European institution.   Many observers concede that the euro was a mistake but think there’s no going back. They reckon that dissolving the monetary union would lead to economic chaos, first in Europe, and then around the world. European leaders are afraid that backtracking on the euro project would also be a lethal blow to the larger cause of European integration and could be the beginning of the end of the EU and the single market. These fears give rise to what we regard as the disastrous strategy of defending the euro at all costs.   Although a controlled segmentation of the euro system through the exit of the most competitive countries would actually be the most effective way to help the deficit countries, it could still be seen as a decision by the strong to abandon the weak. Europe’s history makes it difficult for Germany’s leaders to initiate such a move.   My view – Veteran subscribers may recall that I favoured retention of the European Free Trade Association, to preserve peace and promote economic growth within Europe, long before the single currency was launched. Currency unions, formed by aligned countries which wish to remain independent, have had a difficult history.

Predictably, the euro has not avoided similar problems. It was the triumph of ego and naivety, rather than common sense. It has also compromised democracy within modern Europe. Worse still, it has revived historic enmities among ancient civilisations.

Nevertheless, I have also maintained that the euro would survive, if that is what most Europeans actually want. Today, European governments still proclaim their commitment to the euro, publicly, but this has an increasingly hollow ring. Few European politicians would test this resolve with a ‘yes or no’ referendum on whether or not their citizens favour remaining within the single currency.

Obviously, the single currency would be less contentious if Europe’s economic performance improved. It could, and should, as Europe has moved somewhat closer to fiscal union. Mario Draghi’s ECB has been very effective in lowering interest rates among Europe’s countries with deficit problems. This has bought time but the ECB does not have the mandate to institute pro-growth policies.

The new industrial age is on us and the advantages need to be shared by all not just the 1%

I’ve copied this (see below), verbatim, because it points out a process, which was foreseen back in the 1980’s, and which has yet to be properly addressed by our politicians; or by Political and Economic Theorists.

It is something which the 99% needs to force Politicians etc. to act on, or else the 1% will foolishly try to claim all the benefits of I.T. to prosper themselves, alone.

I say foolishly because the Capitalist Utopia consists of the 99%, having just sufficient income to survive upon, yet still consuming (and therefore paying for) the products produced by the robot factories, owned solely by the 1%.

Explaining the paradox to such people won’t help, because these people are wealth addicts, who can’t see that when there is only one of them left and he/she has all the money, the game (as in Monopoly) is over.

If the game is to continue, there needs to be a continual flow of cash back to the other players and a periodic redistribution of monopoly rights.

 

As in the parable of the ten talents, we could do with something along the lines of each person, entering Society, being apportioned a share of its wealth.

Then, at their departure, they return what they have left.

Some will have used their talents to improve the Commonwealth and be praised.

Some will have simply squandered them and be despised.

Other’s will have hidden their talents under a bush and be pitied.

I’m not an Economist, or Political Theorist and would have no idea on how to turn this, or any variation, into a coherent system but someone needs to.

Marxist and Keynsian Economics no longer have any support and I suspect that Milton Friedman’s theories won’t survive the next decade (for the reasons outlined above).

A new premise needs to be worked out soon, to soften the impact of political implosion, when Government has privatised itself out of business.

 

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Skilled Work, Without the Worker – This is an interesting article on robotics for manufacturing, and ultimately, much more. Written by John Markoff for the NYT & IHT,

DRACHTEN, the Netherlands – At the Philips Electronics factory on the coast of China, hundreds of workers use their hands and specialized tools to assemble electric shavers. That is the old way.

 

At a sister factory here in the Dutch countryside, 128 robot arms do the same work with yoga-like flexibility. Video cameras guide them through feats well beyond the capability of the most dexterous human.

 One robot arm endlessly forms three perfect bends in two connector wires and slips them into holes almost too small for the eye to see. The arms work so fast that they must be enclosed in glass cages to prevent the people supervising them from being injured. And they do it all without a coffee break – three shifts a day, 365 days a year.

 All told, the factory here has several dozen workers per shift, about a tenth as many as the plant in the Chinese city of Zhuhai.

 This is the future. A new wave of robots, far more adept than those now commonly used by automakers and other heavy manufacturers, are replacing workers around the world in both manufacturing and distribution. Factories like the one here in the Netherlands are a striking counterpoint to those used by Apple and other consumer electronics giants, which employ hundreds of thousands of low-skilled workers.

 “With these machines, we can make any consumer device in the world,” said Binne Visser, an electrical engineer who manages the Philips assembly line in Drachten.

 Many industry executives and technology experts say Philips’s approach is gaining ground on Apple’s. Even as Foxconn, Apple’s iPhone manufacturer, continues to build new plants and hire thousands of additional workers to make smartphones,

it plans to install more than a million robots within a few years to supplement its work force in China.

 Foxconn has not disclosed how many workers will be displaced or when. But its chairman, Terry Gou, has publicly endorsed a growing use of robots. Speaking of his more than one million employees worldwide, he said in January, according to the official Xinhua news agency: “As human beings are also animals, to manage one million animals gives me a headache.”

 

And from the conclusion:

 

Inside a spartan garage in an industrial neighborhood in Palo Alto, Calif., a robot armed with electronic “eyes” and a small scoop and suction cups repeatedly picks up boxes and drops them onto a conveyor belt.

 It is doing what low-wage workers do every day around the world.

 Older robots cannot do such work because computer vision systems were costly and limited to carefully controlled environments where the lighting was just right. But thanks to an inexpensive stereo camera and software that lets the system see shapes with the same ease as humans, this robot can quickly discern the irregular dimensions of randomly placed objects.

 The robot uses a technology pioneered in Microsoft’s Kinect motion sensing system for its Xbox video game system.

 Such robots will put automation within range of companies like Federal Express and United Parcel Service that now employ tens of thousands of workers doing such tasks.

 The start-up behind the robot, Industrial Perception Inc., is the first spinoff of Willow Garage, an ambitious robotics research firm based in Menlo Park, Calif. The first customer is likely to be a company that now employs thousands of workers to load and unload its trucks. The workers can move one box every six seconds on average. But each box can weigh more than 130 pounds, so the workers tire easily and sometimes hurt their backs.

 Industrial Perception will win its contract if its machine can reliably move one box every four seconds. The engineers are confident that the robot will soon do much better than that, picking up and setting down one box per second.

 “We’re on the cusp of completely changing manufacturing and distribution,” said Gary Bradski, a machine-vision scientist who is a founder of Industrial Perception. “I think it’s not as singular an event, but it will ultimately have as big an impact as the Internet.”

 

My view – Robotic assembly has been with us for several decades, slowly improving year after year. Now the process is accelerating, thanks to super-fast processors and increasingly sophisticated software. I think the rate of development in robotics is now on the cusp of exponential growth, just as we have seen with computers and communications devices.

This is genuine manufacturing progress of unprecedented speed and proportion. It will increase quality and greatly reduce costs, improving profits for successful enterprises. It will considerably nullify the low wage advantage of developing countries, although they too can benefit from robotics. Yes, robotics is playing its part in levelling the playing field in terms of costs, bringing more manufacturing back to developed countries in the process.

As the cost of manufacturing becomes less of a factor from country to country, companies will be able to produce goods in closer proximity to their component suppliers and especially their customers. Also, competitive rates of taxation will remain a crucial factor in attracting manufacturing sites. Successful Autonomies will thrive more than ever in this environment.

The social problems of permanently high unemployment are daunting and no more likely to be resolved by Luddite policies in the era of robotics than at any other time in human history. Far greater vision will be required to deal with this problem than we have seen to date. If we think about it, there is very little in the way of human endeavour that future generations of robots will not be able to do more successfully than people, aside from recreational pursuits. We will always enjoy social sciences, the arts in their various forms and sport.

My bet is still on October for the Euro to hit the fan.

A neat little summary, from FullerMoney of the present political farce of the Eurozone

Let us summarise the problem:

A number of European countries remain in recession, even Germany is at risk of contraction and unemployment remains stubbornly high on the periphery.

The European banking sector is broke.

No one has a clear idea of what the sector’s liabilities are.

To date governments have been too optimistic in their forecasts for earnings potential and not pessimistic enough about the scale of the losses which need to be written off.

While governments agreed to the idea of a central banking authority for the Eurozone last month, the implementation process remains fraught with uncertainty.

Policy across Europe is now focused on deeper integration but politicians are having difficulty convincing electorates of the merits of such moves.

Yes! In many parts of Europe, protests are ongoing but are not getting reported.

Politicians must think the Olympics a god-send.

What will they do when the last story has been chewed over and there’s no meat left on it?

September could be exciting, especially when MP’s get back from their hard-earned rest in October.

The arrangements for Greece’s return to the Drachma.

The following is presented in the Fullermoney newsletter as an academic appraisal of how the Eurozone might be downsized.

Essentially it outlines of how Greece’s imminent return to the Drachma should be handled.

It seems to be more than a theoretical plan, as the first bullet point seems to have already been put in place, because the second bullet point about printing new Drachma notes is, according to one report, already well under way.

This proposal is that the Drachma would begin as parity with the Euro, before finally setting at about 60% of its original value.

My interpretation of this, especially in view of the last bullet point, is that if you are a tourist try to avoid buying Greek Euro’s or Drachma until absolutely needed.

If you are a Greek, you’re not going to be allowed to take your cash out of the country and should turn your cash into Gold or some other commodity that will hold its value. In domestic terms its value, in Drachma, will shoot up.

The reason for avoiding panic is simply that someone has to lose out and the powers-that- be would rather it was you.

• It will not be possible to be open about preparations to leave for more than a very short period of time without precipitating damaging outflows of money which could cause a banking collapse. Accordingly, preparations must be made in secret by a small group of officials and then acted on more or less straightaway.  

• Given the short time from announcement to implementation, it will not be possible to have new notes and coins available immediately when a country exits the euro. This is unfortunate, but it is not as serious as is often imagined. The authorities should allow euro notes and coins to continue to be used for small transactions. But straight after the decision to leave the euro has been announced, they should commission new notes and coins to be produced as soon as possible.  

• In order to facilitate the convenient use of euro notes and coins, to help to maintain price transparency and to boost confidence in the new regime, we recommend that the new currency, say the drachma, is introduced at parity with the euro. Accordingly, where a price used to be 1.35 euros, it would now be 1.35 drachmas. Of course, the drachma would be free to fall on the foreign exchange markets and indeed it is vital that it should do so.  

• We reckon that if any or all of the weaker members of the euro-zone left, their currencies would depreciate by something like 30-50%. This would probably add about 10% to consumer prices, which, spread over two years, would cause the annual rate of inflation to rise by roughly half this figure. But international experience suggests that such a spike can be short-lived and inflation can then return to something like its previous level.  

• Just before departure, some form of capital controls will be essential, including at least closure of the banks. But after departure, capital controls should be avoided and, if used, should be withdrawn as soon as possible.

#occupy It seems bankers are giving us money(?)

Another interesting snippet from Fullermoney.

Although its full implications aren’t obvious to me yet, it looks, on the face of it, as if the bankers have either developed a case of altruism (possibly with other people’s money/pension funds), or they are worried about the mess they’ve created.

A third possibility is that they are the headless chickens that we believe them to be, totally undeserving of their obscene bonuses.

A fourth possibility that having bought up everything that can be privatised, they’ve nowhere to put their profits, as their mattresses are already stuffed full to bursting and this is the safest option. If it’s the latter then Gov’t should charge them more for buying Gov’t debt.

Still! The Effective outcome is good news for us.

In the eurozone, there are growing signs that governments in places such as Spain and Ireland are “encouraging” – if not forcing – banks and state pension funds to buy public sector bonds, at potentially unfavourable prices.   Meanwhile, in America something just as remarkable is under way: investors are gobbling up government debt at unfavourable rates without needing to be “repressed” at all. This week, demand for 10-year Treasuries was so high – as fears exploded about the eurozone – that the US government sold debt with a record low coupon of 1.75 per cent. And while the nominal yields on 10-year Treasuries, of about 1.91 per cent, are above last year’s lows, in real terms they are in negative territory, given inflation over 2.5 per cent.   Anybody buying Treasuries, in other words, is essentially agreeing to subsidise the US government in coming years – unless you believe that deep deflation looms. Call it, if you like, a form of “voluntary” repression; either way, it will almost certainly end up helping the US state, to the detriment of investors

@MoneySavingExp Fuel price’s likely to drop!

Extract from Fullermoney newsletter, basically says to expect fuel prices to drop.

One of   the great pleasures in life for economists is watching bubbles burst.

First   the speculative air is pumped in just beyond the point of reason.

There is always   a trader willing to say that a tulip bulb will soon be worth a million guilders;   an investment bank ready to predict $200 oil prices by the end of the year.  

There is always a looming war or a potential harvest failure to add spurious   justification. But the end is inevitably the same. The bubble bursts.  

That is what is happening now in the energy market. Sometimes the bubble deflates   rapidly, as with the US natural gas price – now at a 10-year low of less than   $2 per mmbtu. In other cases the air escapes slowly. That is what has been happening   to the oil price since the announcement of a modest fall in Chinese imports.  

Once the fall begins it tends to continue.

European gas prices are also declining   and utilities tied into long-term contracts are struggling to renegotiate terms.  

If the Japanese succeed in restoring some nuclear power capacity the Asia gas   market will follow the downward trend. Simultaneously the important report from   the UK’s energy department has reopened the door to shale gas development in   Britain and perhaps across Europe.  

The oil market is also set for a serious adjustment. Iran has backed off from   its threats to close the Strait of Hormuz, and another complex negotiating process   has begun in Istanbul to find a way in which Israel and Iran can step back from   a confrontation neither could win.

The sanctions on Iranian oil exports are   an important bargaining chip in these negotiations.

If there is any progress,   Iranian production will come back on to the market.

My (Fullermoney) view – There are a number  of interesting points in this article that I will comment on but it is not far off the Fullermoney view, although as bubbles go, I would say that oil has been  a small one recently.

However, there has certainly been an ‘Iran premium’ in   the market which a number of commentators have estimated at about $20.

That   sounds about right to me in terms of the more expensive Brent  benchmark price which does not reflect the shale (tight oil) impact that we   see in the US WTI price.

I have   often   mentioned in recent months that Brent prices were most likely overstating  the risk of an air strike against Iran’s nuclear facilities.

Nevertheless the  price is what it is and it has been a headwind for the global economy as we  also saw at this time last year.

 

@TheGreenParty: Social Capitalism and Practically Applied Green Energy

A piece from Bloomberg, via Fullermoney. I like this because of  it’s realistic use of Green Energy and its use of Social Capitalism :

Farmers Foil Utilities Using Cell Phones to Access Solar – This is a very good story from Bloomberg on the rapidly developing energy industries in a number of countries. Here is the opening:

On a January evening, Anand is shelling betel nuts by the light of an electric lamp in Halliberu, his village in India’s Karnataka state. As his friends gather on the lamp-lit porch to swap stories, children play in the yard, Bloomberg Markets reports in its May issue. Inside, after decades of cooking in the dark, Anand’s mother prepares the evening meal while a visiting neighbor weaves garlands of flowers. In October, Bangalore-based Simpa Networks Inc. installed a solar panel on Anand’s whitewashed adobe house along with a small metal box in his living room to monitor electricity usage. The 25-year-old rice farmer, who goes by one name, purchases energy credits to unlock the system via his mobile phone on a pay-as-you-go model. When his balance runs low, Anand pays 50 rupees ($1) — money he would have otherwise spent on kerosene. Then he receives a text message with a code to punch into the box, giving him about another week of electric light. When he pays off the full cost of the system in about three years, it will be unlocked and he will get free power. Before the solar panel arrived, Anand lit his home with kerosene lamps that streaked the walls with smoke and barely penetrated the darkness of the village, which lacks electrification. Twice a week, he trudged 45 minutes to a nearby town just to charge his phone. Electricity Revolution

“Things are much easier now,” Anand says, describing how he used to go through 5 liters (1 gallon) of fuel a month, almost half of it bought from the black market at four times the price of government kerosene rations. “There was never enough.” Anand is on the crest of an electricity revolution that’s sweeping through power markets and threatening traditional utilities’ dominance of the world’s supply.

@thegreenparty Petrol consumption down…..Fullermoney

Maybe the greenparty should embrace high unemployment as a key factor in cutting the use of Petrol (One of their pet dogma), judging by this piece from Fullermoney.

Musings from the Oil Patch – Thanks to a subscriber for this edition of Allen Brooks’ iconoclastic report for PPHB. The full report is posted in the Subscriber’s Area but here is a section on gasoline:

The rise in gasoline prices and the discovery of this disproportionate impact of sales tax calculations on pump prices has come at a time when gasoline consumption is falling. In fact, the magnitude of the drop in gasoline demand is surprising. Moreover, the reasons for the drop are not totally clear. Do they reflect merely the economic impact of higher prices on consumers, which is limiting their ability to spend on non-essential driving? Or does the fall in gasoline consumption reflect other forces at work in both the economy and our lifestyles?

Because weekly gasoline demand is quite volatile due to factors such as weather and the timing of holidays, we have calculated the four-week average for gasoline demand. The chart in Exhibit 7 shows this demand from the beginning of 1995 to the end of February. We have also plotted in green a parabolic trendline showing the rising demand in the late 1990s and early 2000s and the falling demand in recent years. As can be seen, demand was growing faster than the trendline during the mid-2000s, up to the financial crisis in 2008. The entire 1995-2008 period represented boom times for the U.S. economy and consumer spending. That boom ended with the economic crisis of 2008 and the resulting 2009 recession causing gasoline demand to decline. Gasoline demand recovered in 2010 and early 2011 as signs emerged that the economy was starting to recover. Then gasoline demand seemed to collapse in what appears to be a free-fall that is difficult to tie to the performance of the economy.

There are many factors at work in the automobile market � more fuel-efficient vehicles replacing older less efficient ones; a shifting population mix with different driving records; and altered social patterns eliminating the need to drive � that have cut vehicle miles driven. There is also the distinct possibility that the decline in driving is a more accurate barometer of the health of the economy as it may reflect true employment trends. We have been collecting data to prepare an analysis of these various factors in an attempt to better understand the forces driving gasoline demand in this country. Based on our preliminary results, we believe many of the factors have combined to translate into a permanently lower demand for gasoline in the future.

My view (Fullermoney)� If we look at depressed natural gas prices and the secular uptrend in global supply, high oil and distillate prices, the slow US economic recovery, the squeezing of the middle classes, the government’s need for more revenue, more efficient vehicles and changing social patterns it appears safe to conclude that the energy complex is going through an evolution. Declining gasoline consumption is a symptom of this change. However, the supply side of the equation is keeping pace. Refiners will do what is required to ensure their margins.

 

#occupy Even Capitalists are getting concerned about the actions of banks

From Fullermoney:

MF Global: Uncertain futures – This is a good article (may require subscription registration) on a sorry and damaging saga, written by Hal Weitzman and Gregory Meyer for the Financial Times. Here is the opening:

  Since MF Global filed for bankruptcy on October 31 and revealed that customer money was missing, attention has been focused on Jon Corzine, the firm’s former chief executive. Once a Wall Street “master of the universe”, with a career including stints as head of Goldman Sachs, a US senator and governor of New Jersey, Mr Corzine is now one of the most reviled figures in finance.

There has also been intense scrutiny of CME Group, America’s biggest futures exchange operator and the industry body responsible for regulating MF Global’s commodities business. Some customers are angry at what they say was a lapse in oversight; others say a for-profit entity should not be regulating its own customers. CME responds that no watchdog can guarantee against fraud.

 But the MF Global scandal is more than just a question of tarnished reputations. It has had a profound effect on the entire financial industry. The realisation that customers could lose money kept in segregated accounts separate from the firm’s own money – thought by many to be as safe as a bank – has severely damaged confidence in the 163-year-old US futures market. Before the financial crisis, futures were among the fastest-growing of all exchange-traded products.

“This is unprecedented. It’s the single biggest blow the industry has ever had to its business and credibility,” says a former senior CME executive. “It has forced us to ask the question: is the model of the futures industry so flawed that it can never be the same again?”

 Such soul-searching is rare for a business that in the past 30 years has transformed itself from an agricultural backwater. Futures markets – which enable producers such as manufacturers to fix for the longer term the prices at which they buy or sell rather than expose themselves to the risk of volatility on the daily spot markets – were once seen chiefly as a system of crop insurance for farmers. Today investors trade agreements to buy and sell in the future anything from oil to financial products.

My view – The scandal of MF Global has less to do with regulatory problems than a cavalier recklessness on the part of the firm’s management. Jon Corzine, of all people should have known better. Many observers felt that he was treated deferentially by former colleagues during the Congressional committee hearings examining what went wrong at MF Global.   There should be a proper trial and if found guilty, Mr Corzine and others responsible should receive sufficient fines and jail sentences to serve as a deterrent to others who might be tempted to play fast and loose with their fiduciary responsibilities, not least clients’ money.

#occupy.. cost to build iPhones in the United States

This piece is from Fullermoney newsletter.

One point it neglects is that, like many large U.S. companies, they can’t repatriate oversea’s profits, without incurring a 35% tax hit.

Presumably, similar applies to other Western Corporations.

Perhaps Gov’t’s need to work a deal that brings these businesses back to the West, or offers tax breaks for oversea’s profits used for domestic Labour intensive Public Works.

Politicians and Union’s need to find some way of getting Capital and Capitalists to regrow domestic economies.

“It is hard to estimate how much more it would cost to build iPhones in the United  States. However, various academics and manufacturing analysts estimate that  because labor is such a small part of technology manufacturing, paying American  wages would add up to $65 to each iPhone’s expense. Since Apple’s profits are   often hundreds of dollars per phone, building domestically, in theory, would  still give the company a healthy reward.   But such calculations are, in many respects, meaningless because building the iPhone in the United States would demand much more than hiring Americans – it   would require transforming the national and global economies. Apple executives believe there simply aren’t enough American workers with the skills the company   needs or factories with sufficient speed and flexibility (These jobs and skills were exported, just re-import them the same way).

 Other companies that   work with Apple, like Corning, also say they must go abroad.
 Manufacturing glass for the iPhone revived a Corning factory in Kentucky, and   today, much of the glass in iPhones is still made there. After the iPhone became a success, Corning received a flood of orders from other companies hoping to imitate Apple’s designs. Its strengthened glass sales have grown to more than   $700 million a year, and it has hired or continued employing about 1,000 Americans to support the emerging market.
  But as that market has expanded, the bulk of Corning’s strengthened glass manufacturing has occurred at plants in Japan and Taiwan.
  “Our customers are in Taiwan, Korea, Japan and China,” said James B. Flaws, Corning’s vice chairman and chief financial officer. “We could make the glass here, and then ship it by boat, but that takes 35 days. Or, we could ship it by air, but that’s 10 times as expensive. So we build our glass   factories next door to assembly factories, and those are overseas.”
  Corning was founded in America 161 years ago and its headquarters are still in upstate New York. Theoretically, the company could manufacture all its glass   domestically. But it would “require a total overhaul in how the industry is structured,” Mr. Flaws said. “The consumer electronics business has become an Asian business.  As an American, I worry about that, but there’s nothing I can do to stop it. Asia has become what the U.S. was for the last 40 years.”

This is a more likely incentive for the City of London and Wall Street to shift abroad, unless Politicians can find a way to encourage wealth production here that doesn’t rely on I.T., so much.

In British terms, an example would be to give tax breaks to home based entertainment Industry, such as Film. It could fund universities to provide serendipitous research, instead of tying funding to expected/provable outcomes.