Finance: Past, Present and Future

Last night I attended the annual Queen's University Students' Union Volunteering Awards . It was an inspiring evening and I was delighted that Mogue Lawless, one of our students, was recognised with a special award for his volunteering efforts which centre around helping people with mental health issues. Andrew Haldane , the Bank of England's Chief Economist, is a very interesting economist who likes to look at issues in a novel fashion. He gave a speech last year entitled In giving, how much do we receive?: The social value of volunteering . In his speech, he attempts to measure the benefits to society of volunteering - it truly is a three-figure billion big business, which makes a major contribution to social well-being. However, he suggests that with a little nudge, we could increase even further the social and economic benefit of volunteering. So this raises a challenge for us. What will I do? What will you do? How can we mobilise an army of volunteers?

Part of the fun of writing a book is that you get invited to give talks on it at cool places. This Friday evening I'll be talking about my book Banking in Crisis at the Library of Mistakes in Edinburgh. The idea of this library, which was the brainchild of Russell Napier, is that it contains books on business, economic and financial mistakes so that the present and future generations learn not to repeat them. It is a great idea. Hopefully my book on the history of British banking crises contributes something to our knowledge of why crises happen and how they can be prevented (if there is the political will). 

I was visiting Shenzhen last week and during my visit I was speaking with alumni who work in the investment industry. The main topic of conversation was the huge increases in stock and property prices in China. The Shenzhen Index has doubled since January. The Shanghai Composite has increased 140% in a year. Jincheng Umbrella Holdings floated on the Hong Kong market in February and its shares are up 1700%!  Click here for a New Yorker piece on the Chinese stock market and here for a tongue-in-cheek piece by Tyler Cowen over at Marginal Revolution. After speaking with alumni and after making comparisons with historical bubbles, it looks like China may be experiencing a simultaneous bubble in its stock and property markets. Here are five reasons why I think that China may be experiencing a bubble.  1. Chinese stocks cannot be short sold and property by its nature cannot be short sold. Constraints on short selling have been common features of historical bubbles. 2. The People