Categories ArchivesNews and Analysis

How to Stop Puerto Rico’s Death Spiral link

Long before Hurricanes Irma and Maria delivered their knockout blow to Puerto Rico and many islands in the Caribbean, the U.S. territory was suffering a long-standing economic malaise. The human and economic costs of restoring Puerto Rico’s luster are proving far too great for the scarce resources on the island and far too complex and long-term for an increasingly myopic U.S. Both on and off the island, the lack of political will and leadership has left millions of American citizens of Puerto Rico to fend for themselves. Those who can have left the island in an accelerating mass exodus exceeding 300,000 people since Hurricane Maria struck in September of 2017 – adding to the 600,000 or more who have abandoned ...

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What is Your Default Setting? link

While we may not realize it, a mix of natural tendencies, social norms and codes of conduct give us an almost algorithmic framework to how we make decisions. Add in our natural risk aversion, which has been formed by millennia of falling prey to saber-toothed tigers (or believing one is lurking around the bend), understanding how we are hardcoded to make or avoid decisions, ironically will help us make better choices. What better time to confront this dilemma than at the cusp of a New Year, when so many possibilities may be missed by our deep-seated apprehensions and decision-avoidance biases. If life is nothing more than the sum of our experiences and time is at once our most precious and ...

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Who’s Counting Hurricane Maria’s Human Toll in Puerto Rico link

Puerto Rico is now ground zero for U.S. emergency response and public health efforts to avert a worsening humanitarian crisis. Puerto Rico, the U.S. Virgin Islands and other parts of the Caribbean endured near total devastation of infrastructure, electricity supply and, insidiously, healthcare systems, caused by Hurricanes Irma and Maria. Hurricane Maria, the most powerful storm to hit Puerto Rico in more than 80 years, was just 1 mile below a category five storm sparing no part of the island. Puerto Rico’s already dilapidated infrastructure and downtrodden people, 3.4 million American citizens, were ill-prepared for this devastating event. Now that relief efforts are underway and the island struggles through months to get the electricity grid back to full capacity, efforts ...

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Invest Now or Pay Later link

Long-term asset holders, such as pension funds, sovereign wealth funds and insurers, hold their capital – and with it the retirement, security and educational dreams of their customers – in conservative financial instruments in perceptually safe markets. These investments are closely pegged to underlying asset classes that have historically proven to be safe, somewhat predictable and almost entirely held in mature, highly liquid advanced economies. Whether these are municipal bonds, commercial property or blends of mature domestic stocks, long-term asset managers are prized for their steady hands and unflinching commitment to a long-term investment horizon. This much is required by the investment mandate to protect, preserve and build wealth. This patient investment model, however, is being tested by the convergence ...

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Hard Market on the Horizon link

Disaster fatigue is an understatement for how insurers, first responders and relief agencies such as the U.S. Federal Emergency Management Agency must be feeling about 2017. Communities around the world are reeling from the record loss of life, property and livelihoods following this annus horribilis, which, just in the United States, has seen apocalyptic wildfires in California, record-flooding in Houston, and wide-scale devastation across the Caribbean and Florida Peninsula, courtesy of Hurricanes Harvey, Irma and Maria. These events, along with the devastating earthquake in Mexico City, have conspired to make 2017 what will no doubt prove to be the costliest on record for natural disasters for insurers, as well as for many of the inhabitants of the impacted locations. These ...

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Bitcoin: An Asset, Currency or Collectible? link

For a digital asset that began its life in 2009 and began the year trading around $1,000, the fact that Bitcoin is set to break the $10,000 ceiling is certainly impressive. Other than the many celebrations that will surely follow this milestone, interspersed with a mix of investor remorse or Casandra’s calling this the digital twin of Tulip Mania, many questions remain about the advantages and disadvantages of digital assets. Crypto numismatists who have been collecting Bitcoins are surely happy these days. Investors and early adopters like these assets because they are untethered from the regular economy where fiat currencies, more traditional forms of exchange and value transfer reign the day. It is not without a sense of irony that ...

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24,000 Uber Drivers May Lose Their Side Hustle link

Uber is truly a fascinating company. The 8-year-old firm is at once the source of strategy and business model admiration, as well as the source of a growing volley of corporate scandals and negative market reactions. The firm has wrestled with a barrage of setbacks culminating most recently with the ouster of its crestfallen co-founder and CEO, Travis Kalanick. There may yet be more trouble ahead. This time, however, for Uber’s drivers, who may face a decline in demand for their side hustling, as Uber recently announced the purchase of a fleet of 24,000 autonomous vehicles from Volvo. This purchase marks a radical point of departure in Uber’s business model, which up until now has relied on an asset-light approach, ...

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Months of Darkness for a Glimmer of Hope link

The motto of the United States is E Pluribus Unum – out of many one. At no time is this message of unity more important than during times of crisis. The U.S., like many countries, has been beset on all sides by increasingly severe natural disasters. Whatever their cause, our communities and national ability (or in some cases willingness) to respond is being strained by a dangerous disaster fatigue. This includes the ongoing suffering in the U.S. territory of Puerto Rico, the U.S. Virgin Islands and the Caribbean, which runs the risk of becoming a forgotten crisis, as memory, the news cycle and commitment fades. More than 90 days since Hurricanes Irma and Maria devastated the region, millions in the ...

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Amazon’s HQ2 Belongs in Puerto Rico link

When Hurricane Hugo destroyed my house in Punta Las Marias, Puerto Rico in 1989, I had just turned 12 years old. The category 3 storm devastated much of the island, but compared to Hurricane Maria, Hugo was a near miss. And yet, my life changed forever and the ruin was too much for my mother to bear as she raised four children on her own in abject poverty. After this devastating event, my mother and siblings faced the false choice of sacrificing their own future and education to save the youngest in the family. Thus, I became the child the village raised and was the first in my family to get through high school or college, eventually leaving Puerto Rico ...

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Christian Science Monitor: From Puerto Rico’s ruins, an opportunity to build back better link

A bold, innovative vision is emerging for how to rebuild after hurricanes Irma and Maria battered the island’s shattered infrastructure. But some worry the staggering challenges could overshadow it. As Puerto Rico continues the slow process of recovery from September’s near-knockout one-two punch of hurricanes Irma and Maria, the phrase “build back better” has become something of a mantra. From the governor’s office to still-dark industrial parks, from roofless homes to flattened community health centers, the imperative to “reconstruir mejor” has sprouted as quickly as the fresh green shoots bursting from the swaths of bowed trees that now define the tropical island’s landscape. Speaking Thursday to a convention of Puerto Rican builders, Governor Ricardo Rosselló said that in the wake ...

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