Going with the flow

Article Abstract:

Institutional investors from abroad have been blamed for some financial crises, but it is not always clear whether these institutions have caused or responded to a crisis. State Street is involved in custody and securities lending, and has provded data to assess the impact of these investors. Foreign investors may predict price changes more accurately than domestic investors on emerging economies, and they tend not to withdraw large amounts except when they need cash. Expectations of foreign investment decisions may be linked to crises, and the herd behavior of some foreign investors can exacerbate problems. Evidence on this issue is not clear-cut.

Financial Services, Finance and Insurance, Foreign investments, Developing countries, International relations, Industrialized countries

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A rude awakening

Article Abstract:

Japanese companies may face high costs, especially if they rely on raw materials from the Japanese agricultural sector. Transportation and warehouse rental costs are also high. There are two tiers in the Japanese economy, and the automotive and consumer electronics industries are highly efficient, but many sectors and companies within those sectors are less efficient. This is a result of government protection and anti-competitive behavior such as price fixing. Deregulation is being carried out, but there is still a need for greater levels of competition.

Economic Programs, Administration of Economic Programs, Japan, Economic policy, Deregulation

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Not awakening the dead

Article Abstract:

Institutional investors now own over 50% of the shares in large US companies and they are now much more influential in company management than before. Whether this shareholder activism has led to more profitable companies is not known though, as there are conflicting reports on the issue.

Management, Column, Stockholders, Investor relations

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