Economist 2/20/15

  1. In Philadelphia and San Francisco, presumed gentrifiers have been the target of protests and attacks. Elsewhere, the term is used as an insult.Yet the evidence suggests that gentrification is both rare and, on balance, a good thing.Newcomers with more money supposedly crowd out older residents. In Washington DC, according to a study by Governing magazine, 52% of census tracts that were poor in 2000 have since gentrified—more than in any other city bar Portland, Oregon.Between 1990 and 2010, the number of African-Americans in the District declined by almost 100,000, falling from 66% of the population to 51%.In New York and San Francisco, which both have rent-control rules, soaring property prices create an incentive for property owners to get rid of their tenants. Stories abound of unscrupulous developers buying up rent-controlled properties and then using legal loopholes or trickery to force residents to leave.Yet there is little evidence that gentrification is responsible for displacing the poor or minorities.The bigger problem for most American cities, says Mr Butler, is not gentrification but the opposite: the concentration of poverty. Of neighbourhoods that were more than 30% poor in 1970, just 9% are now less poor than the national average.
  2. Next month the European Union is due to abolish its national quotas on milk production, allowing those big dairy producers being held back by their limits—including Germany, the Netherlands, Poland, Denmark and Ireland—to expand output and seek new export markets.The quotas were a bad idea introduced in 1984 to try to fix the ill-effects of another curdled policy. The EU’s price-intervention scheme, by which it bought farmers’ output whenever milk prices fell below a certain level, was leading to overproduction, and politically embarrassing “milk lakes” and “butter mountains”.Both New Zealand and America, the world’s third-biggest exporter, have expansion plans of their own, of course.Russia’s ban on dairy imports last year, in retaliation for Western sanctions over the Ukraine conflict, hit its European suppliers hard.
  3. THE contrast between the compound of Saudi Aramco, Saudi Arabia’s national oil company, and the kingdom beyond its walls is stark. The box-style houses with neatly manicured lawns make it look more like American suburbia than the surrounding city of Dammam, with its apartment blocks.Aramco is a rare example of competence in the country’s often mediocre and royal-infused bureaucracy.Aramco was believed to be making profits of more than $180 billion a year, far outstripping the $33 billion of Exxon Mobil, the largest listed oil firm.It is developing a new industrial city in Jizan in the country’s south-west, to boost non-oil exports. It runs KAUST, the kingdom’s first mixed-gender university. It was called on to take over from Jeddah’s local council in protecting the Red Sea city from floods. It is charged with building a cultural centre in Dammam, along with 11 sports stadiums. It runs an energy think-tank in Riyadh and a technology cluster in Dhahran.Aramco is not the only national oil company to get dragged into doing the state’s economic-development work, but no other has quite such a smorgasbord of tasks.
  4. Kaspersky Lab has repeatedly impressed sceptics by exposing genuine and serious cyber-security problems. In 2010, for instance, it helped uncover Stuxnet, a computer worm designed to sabotage the Iranian nuclear programme. On February 16th Kaspersky appeared to repeat this feat, not once, but twice. First it released a report detailing how a gang it calls Carbanak had hacked the computer systems of banks around the world. It said the gang had stolen several hundred million dollars by moving money to fake accounts and making cash machines dispense their contents. The same day the firm said it had discovered the “Equation Group”, apparently part of the NSA, which it said was able to embed spyware in computers that gives it total control over them, even after the hard disk has been erased and the operating system reinstalled.Kaspersky Lab, founded in 1997 in Moscow, the company now has offices in 30 countries, 3,000 employees and 400m users, and had $667m in sales in 2013. Consumers generate about 60% of revenues, the rest comes from corporate customers.
  5. Reports emerged this week that Apple is planning to make an electric car. Apple’s plans are unclear and unconfirmed.Despite a reputation, once richly deserved, for sloth in adopting new technologies, most big carmakers are pouring resources both into battery power and other alternative forms of propulsion, and into automated driving. Ford and Nissan have both opened research labs in Silicon Valley.The likes of Apple may not know much about pistons and gearboxes, but the big challenge for electric cars is batteries. Nissan’s Leaf, the world’s best-selling electric car, attracted only 40,000 buyers last year compared with the 250,000 the company once hoped to shift. Tesla aspires to enter the mass market but so far it has dealt with the battery problem by putting lots of them in a big, expensive car, thereby limiting it to a luxury niche.he hope of would-be entrants to the industry may well be that the big carmakers have invested so heavily in internal-combustion engines that they will be loth to switch to electric power. That is overoptimistic. Even if a breakthrough in battery chemistry makes electricity competitive with petrol, big carmakers may yet be able to change course fast.The Chevrolet Bolt, for example, unveiled as a concept car in January, is expected to arrive in 2017 with a price tag of $30,000 and a range of 200 miles.

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