• What is a corporation?

    Ahead of teaching corporate finance each year, I like to try to explain what a corporation actually is. * A corporation is a particular way of organising economic activities. What is called a corporation in the US is called a … Continued

  • Climate change and finance

    Climate change is a systematic risk * In the standard theory of portfolio diversification, we divide risk into systematic and idiosyncratic or diversifiable risk. We argue that idiosyncratic risks can be diversified away, so there is no market reward for … Continued

  • Multiple causation in history: the case of the Global Financial Crisis

    Each year on the Master of Finance core course on Financial Institutions and Markets, I do a session on the Great Financial Crisis of 2007-09. One thing I emphasise is the many different causes of this highly influential event, which … Continued

  • Nuclear is only a small part of the answer to climate change

    Nuclear has a role to play in providing reliable carbon-free electricity, but in the US and Europe it is likely to be too expensive to have more than a small role. * As I have written two books about nuclear … Continued

  • Why markets ignore sovereign debt ratings for the US

    Debt rating agencies have no particular expertise or special information on sovereign debt, especially for developed economies, so their views don’t matter * News that Fitch downgraded the US sovereign debt rating from AAA (the highest rating) to AA+ (the … Continued

  • You can’t insure against climate change

    Climate change involves systemic risk, so it’s not possible to insure against, or diversify away the risk. * Over the years I have sometimes heard investors talk of insuring their portfolios against climate change risks. A group of students once … Continued

  • What is geopolitics?

    Geopolitics has two related but distinct meanings * International politics, the relationship between states, is complicated. What are a nation’s interests? Determined by who? How do national politics affect foreign policy? Can technology transcend geography? How do culture and “national … Continued

  • Avoiding another Cold War

    A child’s enquiry about the Cold War brings back memories and raises concerns for the future * The other day a friend’s child asked me, what was the Cold War? Children ask about history all the time, but perhaps in … Continued

  • The paradox of Chinese Communist ideology

    A country with several thousand years of distinctive cultural history is governed through European ideology * It is often said that China is one of the world’s oldest civilisations, tracing a history back to around 2,200BCE. Of course there were … Continued

  • The beginning of the end of the oil age

    Some people who know me don’t believe it, but as a child I wasn’t interested in international politics. But, like most people in Britain in the 1970s, I knew the name of the Saudi oil minister, because he was a … Continued