Trading nations, fighting firms (first notes)

Exxon Mobil, the US oil giant, had recent annual revenues of $438 Billion. It’s Samsung’s apparent goal to become the world’s first company to have an annual revenue topping $1 Trillion. In this context, Exxon Mobil’s annual revenues already exceed the GDP of Nigeria and Belgium (both about $414 Billion). Samsung’s target revenue would exceed the current GDP of all but 16 of the world’s largest economies, and today would fit in between Turkey (16^th largest at about $1.1 Trillion) and Iran (17^th, $991 Billion).

Today, I can go and buy shares in Exxon Mobil (NYSE: XOM) and thereby both participate in that firm’s fortunes and in the governance of the firm (albeit, at my scale, that’s a faint voice). Samsung, in contrast, is more difficult for me to invest in, since its shares (005930.KS, Seoul) aren’t traded as much outside Korea, and the combine’s common stock shareholders have a much weaker voice in governance. It’s the largest part of the Korean economy – by far, creating considerable sensitivity about broad international trading of this national asset and the potential implications for the nation’s economic health should it be broadly traded elsewhere.

In these notes, I’m going to explore a few threads:

• That the roles generally ascribed to firms and to nations will evolve
• The potential for firms, as opposed to nations, to initiate hostilities – including wars.
• The implication for firms, instead of countries, setting the standards for social compacts
• The idea that shares in countries, and not just their bonds, could be traded on stock exchanges.

NOTE: Source data on national GDPs from Wikipedia, http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29 current as of February 2^nd, 2013; data on company gross revenues from Forbes’ annual ranking of the 2,000 largest public companies, http://www.forbes.com/global2000/

An index for carrots

Carrots, we all know, are bright orange, conical or cylindrical root vegetables. Great in salads, stews, the eponymous cake and divine in the Indian dessert Halva. 

They are also produced in the USA in a market structure that, if it were something people really cared about, would provoke federal government anti-trust action.

80% of all carrots sold in America are produced by two companies. And this provides a nice opportunity to think about market concentration.

The perfect storm in global employment

The changes ahead in work – what it is and does and why it’s done – could well make many of our ideas about work by humans about as relevant in 2040 as the idea of transportation by horses is today in the USA or Europe.

Facing us, in the coming decades, is a new and perfect storm of changes in work, the workforce, the availability and, eventually, the value of work. In the coming decades, the imbalance between the size of the workforce and the scale of available work will grow. Hundreds of millions of would-be-workers will be without work for decades, in countries rich and poor.

There are four major factors shaping this:  Two act to dramatically boost the size of the skilled global workforce, and two act to reduce the availability of good jobs for that growing workforce. The factors are -

• The surge in the global workforce; 
• The increasing skills in that workforce;  
• The concentration of work within ever-more-powerful corporations;
• The rising use of information technologies and robotics to do work that people do or used to do – or that people cannot do.

The scale of these forces and their seeming inevitability seem to set in motion some titanic troubles ahead.

Against these trends, what will we do? What is the world of work going to look like in 30 years’ time? What will people be doing, and why? Will the world hit an apex of “peak jobs” – an absolute maximum in the number of people in employment, and if it does, what happens then?