Author: Pamela Heaven

 If you believe that technological progress drives economic progress, then China and Brazil are the emerging nations to watch over the next couple of decades. Russia, on the other hand, may be headed toward stagnation.

According to figures compiled by Thomson Reuters for the Financial Times, China is on the brink of becoming the centre of global scientific research.

The country’s “awe-inspiring” growth as a research power over the past three decades puts it in second place to the United States based on a survey of the number of articles produced by different countries in peer-reviewed scientific articles. If current trends continue China will be the largest producer of scientific knowledge by 2020.

The news is also good for Brazil, which is making surprising advances in the life sciences and agricultural research. While Brazil produced only one-seventh the number of scientific papers as India did in 1981, it has largely caught up to India.

India’s slowing pace in science may be the result of its most talented researchers choosing to go into private industry than university research. But India is still doing better than Russia, which produced fewer research papers than either Brazil or India in 2008.

Freelance business journalist Ian McGugan blogs for the Financial Post.
 

Where are U.S. interest rates going next? Nowhere but up, according to the Wells Fargo & Co. conference call on Wednesday. In answer to an analyst’s question, the bank’s top management explained that it believes in keeping lots of cash on hand rather than jumping into the fixed-income market at today’s low yields. It expects better rates to emerge soon, when the Federal Reserve stops buying mortgage-backed securities and thus driving down mortgage interest rates. “I think when rates move up, they are going to move at some speed,” said John Stumpf, Wells Fargo’s CEO.

This is interesting on a number of levels. It seems to suggest that other banks are making a mistake by moving more aggressively into fixed income investments. It also raises questions about the U.S. housing market. If Wells Fargo is right and mortgage rates are going to shoot up, it seems likely that the still vulnerable U.S. housing market is going to endure yet more pain over the year ahead. This does not bode well for a strong recovery.

Freelance business journalist Ian McGugan blogs for the Financial Post.