Paradise Papers:

Paradise Papers:

Recently, the public debate has focused on tax paradise: what are they? It's hard to pin down an exact definition. Tax haven is the term usually used in the media and public, whereas the industry would prefer the term offshore financial centre (OFC). It is essentially a financial jurisdiction outside the regulations of your own … Continue reading Paradise Papers:

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What is a Ponzi scheme?

What is a Ponzi scheme?

A Ponzi scheme is a fraudulent investing system promising high rates of return with little risk to investors. In brief, a Ponzi scheme generates returns for older investors by acquiring new investors. In this, a Ponzi scheme is similar to a pyramid scheme, since both are based on using new investors' funds to pay the earlier ones. Companies that engage … Continue reading What is a Ponzi scheme?

Moral Hazard: a simple explanation

Moral Hazard: a simple explanation

Kenneth Arrow in 1963 published an article about the uncertainty in economics, focusing in its consequences on the medical insurance. This article introduced for the first time in history the concept of moral hazard. A practical explanation of what moral hazard means can be found in the movie "Wall Street: money never sleep", directed by … Continue reading Moral Hazard: a simple explanation

How economics saves you from traffic

How economics saves you from traffic

The C40 is a gathering of 91 metropolis from all over the world, at the moment directed by Anne Hidalgo. The mayor of C40 have reached, the 23rd of October, an agreement: to transform their cities in greener, healthier and clean energy based territories. In Paris for the annual summit Together4Climate, the mayor of Paris, … Continue reading How economics saves you from traffic

Black Monday: the stock market crash of 1987

Black Monday: the stock market crash of 1987

After the Great Depression, started with the famous stock market crash of 1929, American people became so afraid of losing again all their saving that they left the markets, being replaced by institutional investors, such as insurance companies, pension funds, hedge funds, mutual funds and commercial banks. Moreover, the Securities and Exchange Commission (SEC), created … Continue reading Black Monday: the stock market crash of 1987

Is Herbalife a fraud? Bill Ackman says it is a huge one

Is Herbalife a fraud? Bill Ackman says it is a huge one

It was May 1st , 2012 when David Einhorn, a well-known hedge fund manager, founder and president of Greenlight Capital, asked accurate questions about Herbalife International's business and sales models during the first quarter's earnings call, setting off suspicions that he had a short position on the stock. In fact, in January 2013 Einhord revealed that … Continue reading Is Herbalife a fraud? Bill Ackman says it is a huge one