Monday, 2 December 2013

GUEST POST: Investing for a Better Future

Elliot Dolan-Evans (elliot@surgia.org)
(Year 3 MBBS; Past President of the Surgical Interest Association; CEO Investing for Charity Health)

As a medical student, I don’t often write blogs in economics pages – but I have been a long-term admirer of the opportunities, power, resources and capabilities that the finance and economics sectors hold. I entered medicine with the common idealism that many do; to help those less fortunate than I. However, more and more as I move through medicine, I have come to the realisation that to enact significant and sustainable change for those who suffer with curable disease or are affected by widespread transmittable pathogens, the medical field must look for help. Medical teams and health organisations simply do not have the resources or even the expertise to effectively address wide-spread social issues. Experts in business, the wealthy organisations that shape the economy, and the leaders in the finance sector are the ones who possess what well-meaning charities and medical practitioners do not – expertise, professionalism and resources. It is imperative that the health and medical field partner with business, and utilise each other’s areas of expertise to address the avoidable and fixable health inequalities that are engulfing people around the world.

Leaders in the business field have already realised this fact; Gates, Buffet and others are leading the revolution – but the effort needs to be wider, and involve the whole community. Indeed, a culture change may be what is required in the financial world, to involve and empower everyone in combating these pertinent social issues. And to do this, cultural reformation must occur at the grassroots level – with ambitious young people and enthusiastic students. These individuals are the future of the world’s wealth, and to develop a philanthropic and socially conscious attitude in them would change the face of this world for the best. Students need to feel empowered to address wider social problems and inequalities. Young people with an interest in finance and investing often do not have the opportunity to learn about sound, responsible and socially conscious investment principles; and how their decisions and actions can potentially influence the lives of millions.

I, along with others around the world, are creating an outlet for philanthropic students and young people in the finance and business world, a charity that utilises sound financial and investing principles to raise money and combat health inequality. Investing for Charity Health (I4C Health) has been established to draw attention to global problems, and empower students and young professionals with a means to really make a difference in terms of worldwide health inequalities. I4C Health is starting on the Gold Coast in 2014, and will provide an opportunity for ambitious, young leaders in the business and finance worlds to enact meaningful change. The organisation will teach students principles of practical investing on the share market, and then those so trained will invest money for the charity, with the eventual profits passed on to where it is needed most.

I4C Health will invest in students and young professionals, providing them with opportunities to enhance their personal brand, leadership and professional skills through practical investment experience, networking with the professionals on the Board and mentors in I4C Health and through becoming a leader in the organisation. By investing into young people and creating a culture of selflessness and giving I4C will promote inter-professional collaboration with the goal of directly addressing global societal problems.

I am looking for others to share in my vision for a healthier future, and the I4C Health fund will be the key component of this vision. To leave you all with the mission of the charity:

Investing for Charity Health will provide education in responsible investing and create a culture of philanthropy and integrity in young Australians, with the ultimate aim of sustainably and significantly supporting health-related charities.

Monday, 18 November 2013

Nobel Prize in Economics

So for those who missed it, the Nobel Memorial Prize in Economic Sciences was awarded last month to three Americans - Eugene Fama, Lars Hansen, and Robert Shiller "for their empirical analysis of asset prices."

http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2013/press.html

I found this an interesting move because Fama and Shiller are at opposite ends of spectrum when it comes to their views on market efficiency (the former developed the efficient market hypothesis, while the latter is famous for his contributions to behavioural finance and identifying market inefficiencies). Meanwhile, you also have Hansen who developed the Generalised Method of Moments (GMM, a method for estimating the parameters in an econometric model) that has much wider applications for finance and economics. A bit of an assorted bag here.

Personally, I would have liked to have seen Shiller share the prize with Richard Thaler (a key figure in behavioural economics), but I guess that's my own bias given I have been researching behavioural economics for the best part of the last 12 months!

Anyone else have thoughts on the recent Nobel Prize announcement? Feel free to disagree.

Australian Households' Exposure to Banks

Here is a very interesting article courtesy of Brett Doran concerning the relatively high exposure of Australian households to bank securities. What implications do you see this having for fund managers or financial planners in the short and long term? Should we be concerned?


Looking forward to reading your comments!

And We're Back!

Welcome back! The Griffith Economics Blog is up and running for the summer and you can expect more frequent posts in the coming weeks. Hopefully this blog will continue to generate some interesting discussion and give you some food for thought over the break.

Given that my time at Griffith is coming to an end this year, I am interested in having a few co-authors on board for next year who would be willing to start new threads in this blog on a relatively frequent basis. If you are interested, send me an email using your Griffith student email address to griffitheconomicsblog@gmail.com and let me know what you are studying and any ideas you would like to bring to the blog. It would be nice to get a mix of undergrads, honours, PhDs, and even recent Griffith graduates if possible!

I am also interested in exploring some different topics with this blog in addition to discussing recent economic news. Grad recruitment? Internship stories? Honours? Course selection? I am happy to share my personal experiences in this blog, and I am sure there are other readers prepared to do the same. Comment on this post or email me with ideas, please.

Wednesday, 17 April 2013

University Funding Cuts


Sorry for the lack of new threads lately – you know the story, snowed under by assessment items and job applications etc.

Given our vested interest in the higher education sector, I thought it was only logical that this blog open a discussion about the recent announcement of funding cuts to Australian universities. A summary of the cuts can be found here.

Try to think of this decision from a (benevolent) policy-maker's perspective. How would this policy be analysed in terms of equity and efficiency? Where are the funds going and does this seem like a logical trade-off? What would you have done differently? Are there any other issues regarding higher education policy that you would like to discuss (e.g. vouchers vs. the current HECS system, competitiveness of the sector, sustainability)?

Sound off in the comments below! 

Monday, 11 March 2013

The Low Rate Conundrum

This should appeal to all of the fans of macroeconomics. Here is a blog from The Economist on monetary policy in the U.S. from last week.

Some questions to think/comment about: How low is too low with regards to interest rates? Are low U.S. interest rates really just the Fed's fault? Is the Fed setting the U.S. economy up for even more problems in the long-term with it's persistent low interest rates and quantitative easing?

Sound off below!

Saturday, 23 February 2013

The Cost of Crime

Another Ross Gittins article for you - this time related to crime. The link is here.

Personally, I always find it interesting when economics is applied to some non-traditional areas. How can we use our resources more efficiently to reduce crime? Gittins makes a great point about the severity of the punishment being less important that the swiftness with which it is administered. Look at the U.S. - many states still have the death penalty, but inmates usually wait YEARS for their punishment (if it ever comes at all). And the U.S. crime rate? Still substantial for a Western country.

Obviously, there are numerous factors at play when it comes to the determinants of crime, and the type and swiftness of the punishment are only 2 of them. From an econometric perspective, there is also an endogeneity issue at play when modelling and explaining the crime rate - some of the explanatory variables are jointly determined with the crime rate. For example, you would think that increasing the number of police officers would reduce the about of crime. But you would also think that if the crime rate went up, the number of police officers hired would increase. This is endogeneity, and must be carefully dealt with by the analyst in their model.

So given this article, what policies would you put in place to reduce crime and potentially reduce the cost to taxpayers?

Saturday, 9 February 2013

Leaving Comments and Creating a Blogger Account

I put together some instructions on how to post your first comment and simultaneously create your Blogger account using your Griffith student email address.

Hope this helps!



Wednesday, 6 February 2013

Impatient Miners Hijacking Economy

One article that generated a fair bit of discussion among the Economics Internship forum last semester was "Impatient miners hijacking economy" by Ross Gittins. The link is here.

Any opinions on this article? Perhaps some areas to discuss could include how prices create incentives for different economic agents, how risk should be dealt with in discount rates, and how best to consider the welfare of future generations in a traditionally short-sighted economic environment.

Friday, 1 February 2013

Welcome!


Welcome to the Griffith University Economics Blog! Glad you could find it.

For those who don’t know me, my name is Stephanie Parsons and I graduated with a Bachelor of Commerce (Economics and Finance) from Griffith University (Gold Coast) in 2012. I am now completing my Honours in Economics so I will be splitting my time between the Gold Coast and Nathan campuses this year.

The idea for this blog came from the Economics Internship program I completed in 2012, where one assessment item involved posting in an “Economics Forum” frequently during the semester. This forum (which was based in the “Discussion Board” section of Learning@Griffith) discussed various topical issues in economics using newspaper articles, interviews, and op-ed pieces as stimuli. We could even post our own ideas to start a thread.

What I want to do is expand this concept to all students studying economics! I found the writing process to be quite enjoyable and a nice change from the usual academic writing style we use for assignments and exams.

Since we don’t have access to our own Discussion Board on Learning@Griffith, I figured the next best thing was to start a Blogger/Blogspot account. The reason I’ve chosen to use Blogger/Blogspot is that it is powered by Google, as are our student emails. Blogger allows you to sign in with your Griffith email account and password and comment on blogs without actually having to make your own blog if you don’t want to. I’m a first time user of Blogger myself, so there may be some kinks to sort out initially, but I’m hoping we can create a little Griffith blogging community here.

Some basic guidelines for this blog:
·         You must post using your student email address – no personal email accounts otherwise we don’t know who you are.
·         While everyone can comment on blog posts, only I can make new threads. If you have an idea for a new thread you can send it to me at griffitheconomicsblog@gmail.com and I will post it on the blog. They don't need to be very long, just enough to get the conversation started. Sometimes all you'll need to start a new thread is a link. But if you're in the mood to vent about a particular economics issue (i.e. write several hundred words), that's fine too.
·         I know it’s obvious, but please don’t be a troll or post hateful comments here – they will be deleted. If you are going to criticise, be constructive with your comments. Don’t say something online you wouldn’t say in person.
·         Lastly, this is just meant to be a bit of fun. See it as an opportunity to take economics out of the classroom and into the real world.

I hope you enjoy this blog! J

P.S. When it comes to blogs, I say the more contributors the merrier! So tell your friends about this blog, share it on Facebook, Twitter, or LinkedIn, and even mention it to your lecturers and tutors! As I said, anyone with a Griffith email address is welcome to post.