Manufacturing, despite all that, remains crucial to our economy

Dr. John Psarouthakis, Executive Editor of, Founder and former CEO, JP Industries, Inc., a Fortune 500 industrial corporation, Adjunct Professor(ret.), Ross School of Business, University of Michigan.

Let me recap the ways one might, at a glance, think of the manufacturing sector as having become an afterthought in sustaining America’s future as a prosperous nation, a place where quality of life is high, and a place that is the world’s destination of choice.

First, manufacturing for decades has not, and never again will, directly employ Americans in anywhere near the numbers it used to, and those it does employ will increasingly need more skills. Second, the rest of the world will always be able make things as well as us, and cheaper. That ought to be enough to seal the idea that manufacturing has become deadwood? Wrong. The first point is true, but surprisingly irrelevant. The second point is simply false.

Keeping high-tech manufacturing in this country when possible even if the direct workforce shrinks drastically, because otherwise the technology will tend to flee offshore, along with the factories. Innovation has always been America’s strong suit in the global economy. Meanwhile, the R&D surrounding even a shrunken manufacturing sector is itself an important source of employment—as are the host of vendors serving manufacturers. Our great educational establishment is the world’s model, but on the vital science and technology side needs to be near a prosperous industrial, commercial, health-care, and pharmaceutical infrastructure in order to remain great.

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Forget planned obsolescence; it will happen, planned or not

Dr. John Psarouthakis, Executive Editor of, Founder and former CEO, JP Industries, Inc., a Fortune 500 industrial corporation, Adjunct Professor(ret.), Ross School of Business, University of Michigan.

Millions of American “smokestack” jobs no longer exist. Millions of other American jobs, from nearly every sector, have been exported. Tens of millions of Americans are now sustained only by the “safety net,” or by working multiple part-time jobs at low wages with no benefits. More than one-quarter of working Americans lack enough resources to sustain themselves three months if laid off, a number that no doubt has risen since it was last compiled. This is a very, very bad time to be an unskilled worker with no prospects of being retrained in a way that will land a job. A human being whose skills are obsolete is among the saddest of stories. Some of these Americans, especially older workers, are going to be left behind. Millions more will never earn the kind of living they once did. This states one hellacious problem; but it does not define the problem in any useful way for a problem-solver.

In getting one’s arms around what might seem like an unprecedented catastrophe, it’s good to start by realizing that today’s displaced workers are not alone in the American experience. Our workforce is undergoing massive transition, a tectonic shift, really, in the way Americans earn their livelihood. But it is not unprecedented.

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Greek Banks in the Balkans: the big crunch

Ms. Athanasia Dimitriadou, M.B.A. Student – Specialization in Finance

Dr. Periklis Gogas, Associate Professor

Department of Economics


Democritus University of Thrace

Mergers and acquisitions are often used as a means of bank expansion both nationally and even more so internationally. Greece joined the EMU in 1999 and was in the first group of EU countries that abandoned their national currencies and adopted the euro in its physical form in 2002. From that point on the Greek banking sector became an integral part of the European monetary and economic union. There were multiple benefits from this integration. On the top of the list was the stability that was guaranteed by the European Central Bank (ECB) and its supervision mechanisms. This stability and the related risk minimization was reflected in the low financing costs of the European banks in general and Greek banks specifically. This fact significantly widened the spread between lending and deposit rates for Greek financial institutions so that profit margins increased. These margins were sufficiently large that Greek banks did not need to invest (at least not greatly) in financial instruments such as Asset Backed Securities (ABS) or other derivative financial instruments that appeared to have high yields. After the crash in the markets were these assets were traded they became widely known as “toxic bonds”.

Greek banks did not have a high exposure to these bonds as they found an alternative source of high revenues: the expansion to neighboring countries in the Balkans. These emerging economies started their financial liberalization process and opened their financial sector to international investors. In Table 1 below we report the most important investments of Greek banks in the Balkans before the Greek Debt Crisis. The five major Greek banks were very active in investing in the Balkans. These were more specifically: the National Bank of Greece, Eurobank, Piraeus Bank, ATE Bank and Alpha Bank. In the first column of Table 1, we present the Greek bank that invested in the Balkans, in the second column we report the acquired foreign bank, in the third column we report the country of the acquired bank and in the final column the percentage stake of participation. In all, fifteen banks were acquired in total or in a major stake by the five systemic Greek banks.

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