Hype, hubris and a solution to England’s penalty shoot-out woes

Afternoon all,

Everyone being a bit rubbish has made this quite a good World Cup so far. Unfortunately it hasn’t had quite the same effect on British politics as the “no-one really has a Brexit plan” roadshow rolls on – but here’s hoping. After all things will only get tougher when facing Boris, Gavin and Phil Colombia in the next round….

In this week’s reads we focus on Bitcoin, the only recent bigger display of hype and hubris than our excitement at beating Panama 6-1. We’ve also bring news of something that the Russians have (thankfully) beaten us at: national narcissism.

As always any feedback/thoughts/suggested reading very welcome indeed. Enjoy the weekend,

Torsten

Director

Resolution Foundation

Bonkers Bitcoin. Not a day goes by without something new on Bitcoin – it’s the future. Apparently. Now I’m not a fan, so enjoyed the most recent piece on the Ponzi-scheme crypto currency’s ludicrousness in which analysts reckon its current annual electricity consumption is 71.12 TWh. No I don’t know what a TWh is either, but this apparently means it is using up a bit more electricity than Switzerland and the Czech Republic and a bit less than Chile. If Bitcoin was a country its electricity usage would put it 41^st in the world. Not great news for Bitcoin investors. Or climate change.

National narcissism. What contribution do you think the country you are living in has made to world history? Answers between 0 and 100 please. A realistic answer for any country, of course, is not very much. But an intriguing paper published this week reports on a survey which asked this question to students in 35 countries (Times report here (£)). The most modest country was Switzerland (with a still-high average response of 11 per cent), while the least modest was Russia (at 61 per cent). Before we start sneering at Russian pomposity, the bad news is that UK students (or at least 92 of them from Brunel University) thought our contribution to the course of history was an almost as ridiculous 55 per cent, putting us in second place in this particular hall of shame…

Boosting profits. Those of you pondering the state of capitalism should read this interesting new paper that considers the implications of big firms (from Amazon to the high profile Asda/Sainsburys tie up here in the UK) having lots of market power. It finds that firms across the developed world are getting more powerful – and are able to make higher profits as a result. This is particularly driven by ‘superstar firms’ doing very well. In the short term that might be good for innovation with those firms investing more – but when they get too powerful they stop bothering to invest much. Oh and workers lose out too. Not a perky read. We’ll be publishing a UK-take on firm concentration shortly…

Cancel your meetings. You can’t have missed the never ending row about why Britain is in the midst of a huge productivity stagnation. Andy Haldane, the Bank of England’s chief economist, had another interesting contribution this week. But leaving aside what has caused the productivity crisis, what can we do to fix it? Since we’re in the middle of a heat wave we’re definitely backing the ideas of Maurice Schweitzer, who has the deeply practical suggestion of having many fewer meetings. You can read his and other ideas in The Economist’s Bartleby column this week. The sun is out people, but it won’t last, so cancel those meetings and head to the nearest park.

Chart of the week – Should central bankers take penalty kicks?

Branko Milanovic is famous for arguing that low and middle income households in advanced countries are losing out on the global income growth stakes (something we don’t completely agree with). But it’s less well known that he has also done some thinking about…. football. This week’s Chart of the Week looks at the (possibly tenuous) correlation between a country’s central bankers hitting their targets, and their footballers’ penalty shoot-out success rate. England are pretty good at the former, but the latter – not so much. So, as England head to the knockout stages of the World Cup, should we be asking Mark Carney to take our penalty kicks? A late call-up and World Cup glory awaits…