Technology-based manufacturing of all sorts, Mr. Immelt says, has to be a central part of reinvigorating the economy. In speeches and position papers, Mr. Immelt, a member of the White House’s Economic Recovery Advisory Board, has called for doubling manufacturing employment in America, to 20 percent of the work force, which he concedes is an “aspirational” goal.
Making progress, he adds, will require significantly improving the nation’s prowess as an exporter. G.E., by the way, happens to be America’s second-largest exporter, after Boeing. So Mr. Immelt’s views about what changes would benefit the economy would probably help G.E. as well.
“Many bought into the idea that America could go from a technology-based, export-oriented powerhouse to a services-led, consumption-based economy — and somehow still expect to prosper,” Mr. Immelt said in a typical speech last year before the Detroit Economic Club. “That idea was flat wrong.” He added: “Our economy tilted instead toward the quicker profits of financial services.”
“Never have so few owed so much to so many, and given them so small a return,” Mr. Kane said. “We see, for example, how little these institutions have given back to troubled homeowners whose houses are threatened with foreclosure.”
Mr. Kane’s point is important. Certainly, the low interest rates the Fed charged to institutional borrowers during the disaster translate into a significant subsidy, indeed a gift, to many of the firms that set the financial collapse in motion.
But the Fed is silent on how big that subsidy actually was.
Google’s income shifting — involving strategies known to lawyers as the “Double Irish” and the “Dutch Sandwich” — helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization, according to regulatory filings in six countries.
As they detected that they had amassed excessive “long” positions, they began to sell aggressively, which caused the mutual fund’s algorithm in turn to accelerate its selling.
Startlingly, as the computers of the high-frequency traders traded contracts back and forth, a “hot potato” effect was created, the report said, as contracts changed hands 27,000 times in 14 seconds, but with eventually only 200 actually being bought or sold.
The selling pressure was then transferred from the futures markets to the stock market by arbitrageurs who started to buy the cheap futures contracts but sell cash shares on markets like the New York Stock Exchange.
What they do doesn’t show up in Google Finance, let alone in the pages of the Wall Street Journal. No one really knows how they operate or why. But over the past few weeks, Nanex, a data services firm has dragged some of the odder algorithm specimens into the light. The trading bots visualized in the stock charts in this story aren’t doing anything that could be construed to help the market. Unknown entities for unknown reasons are sending thousands of orders a second through the electronic stock exchanges with no intent to actually trade.