Although I’ve been looking around recently, there’s hardly any discussion about the scenario that China’s economy could nose dive.Β The prospect would be interesting to say the least, and would have a dramatic effect on the world economy.Β However yesterday The Independent published a piece looking at the possibility of China slowing down post-Olympics.Β The most riveting statement was this:
The basic point is that Chinese consumers have taken over from those in the US as the main drivers of additional demand in the world economy. […] All eyes will be on China over the next month. It will be the first time for most of us in the West that we will have to contemplate a world where China takes over from the US as the largest economy. That tipping point is probably still 25 years away, but long before that the shift of power will shape our perception of global economics.
The World Bank has made an announcement that the Chinese economy is expected to recover some time this year, possibly on the second half of 2009. How do you think investment banks in China would fare during this recovery? Do you agree with this post – http://www.topemployers.co.uk/teb/finance-jobs/NY_Wang/1/China-Banking-Jobs-for-Blue-Ocean-Strategists.htm
The post you mention does resonate. Innovation suffers from an irony in many organisations – when things are going well, senior leaders think they don’t need an innovation capacity. After all, they’re making money so what value would it add?
However in a downturn innovation is one of the first things to be cut. This is a mistake, and there’s a myriad of great examples of where investment in innovation during a downturn has paid off when the economy picks up. The classic example of this is Apple – have a look here for more detail: http://www.rogerdennis.com/ideaport/?p=160
There’s no reason why investment banking would be any different.