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There are some that now believe the US has lost ground as a competitive economy:

The United States was knocked out of the top spot in this year’s ranking of the world’s most competitive countries, a position it had held since 2013.

This according to the annual evaluation by the International Institute for Management Development (IMD), a Switzerland-based private business school whose World Competitiveness Center research group has ranked nations on their competitiveness on the global business stage since 1989.
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The United States fell two positions on the annual ranking, supplanted by Hong Kong and Switzerland. Hong Kong’s role as the gateway to the economic might of the Chinese Mainland (which ranked 25 on the list), as well as the rest of Asia, gives it fuel for its economic machine. At the same time it is diversified and therefore safer from economic shocks within the region. But there are other factors at play, says Professor Arturo Bris, director of the IMD World Competitiveness Center.

“Hong Kong has an amazing regulatory system,” Bris told Forbes. “Business-friendly, promoting competition, and at the same time investing in public education. It has built an amazing public sector – which, of course is easy to do in a small economy – but Hong Kong is extremely efficient.”
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Switzerland, which jumped two places to settle at No. 2 this year, withstood currency depreciation to surge in 2016. “Exports have increased and capital influx has increased as well and the GDP has grown,” explained Bris. “The Swiss economy has performed well, despite these monetary imbalances.”
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. Hungary, for example, has given fiscal incentives to the IT business community, says Bris. “In Hungary, if you are an IT professional, you don’t pay income taxes—same thing in Estonia or Lithuania.” Professionals in Eastern European nations, he added, have played a role in innovations by companies like WhatsApp and Spotify.

The problems with risk-assessment are apparent in fields other than investment:

Millions of Americans are missing out on a chance to avoid debilitating fractures from weakened bones, researchers say, because they are terrified of exceedingly rare side effects from drugs that can help them.

Reports of the drugs’ causing jawbones to rot and thighbones to snap in two have shaken many osteoporosis patients so much that they say they would rather take their chances with the disease. Use of the most commonly prescribed osteoporosis drugs fell by 50 percent from 2008 to 2012, according to a recent paper, and doctors say the trend is continuing.
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There is little question that fractures caused by fragile bones are a real problem, particularly for women. A 50-year-old woman has a 50 percent chance of having an osteoporotic fracture in her remaining years. The drugs, meant to be started when bone density falls very low and the chance of a fracture soars, can reduce that risk by half, studies show.

But to many, it matters little that the drugs’ frightening side effects are extremely rare. Estimates are that 10 to 40 in 100,000 osteoporosis patients taking the drugs — including alendronate, ibandronate, risedronate and zoledronate — have sustained broken thighbones. Fewer than one in 100,000 have had the jawbone problem.

“You only need to treat 50 people to prevent a fracture, but you need to treat 40,000 to see an atypical fracture,” said Dr. Clifford J. Rosen, a professor of medicine at Tufts University who has no association with the makers of the drugs.

PerpetualDiscounts now yield 5.50%, equivalent to 7.15% interest at the standard equivalency factor of 1.3x. Long corporates now yield about 3.95%, so the pre-tax interest-equivalent spread is now about 320bp, unchanged from the value reported May 25.

This entry was posted on Wednesday, June 1st, 2016 at 11:06 pm and is filed under Market Action. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.