Category Archives: Economics

Book Review: Fourth Industrial Revolution by Klaus Schwab

Dear All,

One of the January reading list book, Fourth Industrial Revolution, was recommended by a bright young gentleman, Ogul Havayir. He was so kind to agree to write a book review on this book to share with all the followers.

Thank you dear Ogul!

The Fourth Industrial Revolution

Klaus Schwab starts with a very simple and visionary thesis: human beings are now facing with an unprecedented transformation of their lives from various aspects including work, relations, and institutions. Schwab defines this transformation as a fourth industrial revolution and singles out this industrial revolution from previous ones in terms of its breadth, speed, and scope. Schwab’s intention is to shed light on how this revolution will impact us and how human beings can leverage this revolution for the common good. Most of the arguments advocated by Schwab are supported by the relevant data which cements his views and illustrated through practical examples.

In my opinion, Schwab defines a great and condensed framework in outlining the backbone and the potential outcomes of this revolution not only from humankind’s perspective but also governmental, business and global perspectives through accompanying these stakeholders’ relations with very key drivers, ideas, and technologies. What I particularly like about this book is that it enables everyone to be aware of what kind of a transformation that we are currently witnessing and allows us to grasp how we can contribute it and position our lives to fully cope with it.

The book prioritizes some new developments and trends as key factors of fourth industrial revolution in 3 main fields such as physical, digital and biological. Schwab gives unique and explanatory examples to underline how deep the impact of megatrends will be. One of the most vivid examples was related to physical technological megatrends. Schwab gives an example of developments of new materials, especially a material called graphene, which is roughly 200 times stronger than steel and a million times thinner than a human hair, and an efficient conductor of heat and electricity. This material is expected to be a superior substitute of steel which numerous economies relied on. Thus, Schwab implies that when graphene becomes price competitive, it will have an enormous impact on steel-based economies such as China, Japan, and the US, and reshuffle the cards in the global economic competitiveness in that field. Several other key trends are discussed with practical examples by Schwab including but not limited to autonomous vehicles, 3D printing, robotics. Schwab also pays heed to how to direct key biological developments toward the best possible outcomes by recapping the importance of the meaning of human, which data and information should be shared with others and what rights and responsibilities we have when it comes to changing the biological genetic code of future generations.

Next key topic according to Schwab is that the fourth industrial revolution will have a profound impact on economies, businesses, societies and the individuals. As a techno-optimist, Schwab thinks that humankind has just started to be influenced by the fourth industrial revolution and his thoughts are backed by 3 main sources in which I totally accepted. Firstly, Schwab advocates that this revolution will unearth the latent demand from undeveloped part of the world through making existing products and services available for them. Secondly, the fourth industrial revolution will be facilitating us to deal with negative externalities like carbon emissions and fuel economic growth further. Lastly, businesses, governments, and civil societies will able to grasp the merits of this revolution for the purpose of fully utilizing these merits. In my view, the most important impact of the fourth industrial revolution on the economy will be related to employment. Schwab argues that through the deployment of newly-emerging technologies including AI, robotics and machine learning, various jobs and skills are expected to be automated, indicating a risk associated with the labor substitution. However, his discussion also encapsulates that acceptance and prevalence of these newly-emerging technologies will create new jobs and skills. The counter arguments give rise to the question of which effect will supersede other. Another key impact of the revolution on the economy is the potential deterioration of income inequalities across the world. Schwab argues that whether this revolution will be a winner takes all phenomenon or allow undeveloped parts of the world to catch up developed economies.

I was mostly influenced by the impacts of this transformation on the way we work, the way we operate businesses and the way we allocate our resources to create value. Schwab advocates that creation and harnessing of cutting-edge technologies will lower the entry barriers for various industries and will lead to disruption coming from startups and vanishing market shares of well-established large incumbents. These disruptions may result in fundamental changes in the value chains for various industries. According to Schwab, the fourth industrial revolution will have four main effects on business including major shifts in customer expectation, enhancement of products via data utilization and increasing collaboration among companies as well as digitalization of operating models. In my opinion, digitalization of operating models is the most vital effect among all. In order for companies to fully adopt their organizations to fourth industrial revolution, their strategic planning should be able to design the required frameworks and roadmaps to operate companies more agile and faster. Schwab stresses the importance of “platform” strategy and sees it as a disruptive and profitable. Schwab further explains the effects of platforms and underlines how the ownership is redefined with increasing scope and size of platforms. Customers become more willing to pay for services such as access to an online service such as Amazon Kindle or delivery instead of ownership of physical products.

Schwab also discussed the impact of fourth industrial revolution on governments and countries, societies and the individuals. Schwab points out that government has a very key role to nurture innovation and incentivize learning and adaptation of any developments that can contribute community. Lastly, potential impacts of this revolution on the individual were discussed by Schwab and concluded that rapid adoption of the technology could weaken basic human capacities such as self-reflection, empathy, and compassion.

Thank you again dear Ogul Havayir!

All the best from Singapore.
Sukru Haskan
Twitter: @sukru_haskan

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Reading List: March 2018

Dear All,

We are almost in the last month of first quarter and my reading challenge has been going really good so far.

During the first two months, I really enjoyed reading each of the books.

If I need to highlight the best books of the month, I would choose “The Art of Thinking Clearly by Rolf Dobelli” from January list and “Shoe Dog by Phil Knight” from February list.

I am publishing the reading list for March 2018 below. Enjoy!

Reading List: March 2018 

  1. The Book of Joy by Dalai Lama, Desmond Tutu, Douglas Carlton
    Genre: Spirituality, Philosophy 
    Douglas Carlton captures the visit of Desmond Tutu to Dalai Lama’s hometown and their couple of days together. Even though they believe in different religions, they show the world that they can be really good friends and they talk about happiness as well as having fun through journey of life.
  2. Mindset: The New Psychology of Success by Dr Carol Dweck
    Genre: Business, Leadership
    Dr. Carol Dweck talks about the differences between the fixed and growth mindset in her book and she gives a lot of great insights from business life, parenting, and personal relationships. Such a great book to understand the difference between a boss and a leader.
  3. The Richest Man in Babylon by George Clason
    Genre: Economics, Personal Help 
    It is a book of small stories about how the richest man in Babylon has become the richest man in that era. There are quite a lot of practical information in this book which is easily applicable to our modern lives.
  4. Elon Musk by Ashlee Vance
    Genre: Business, Biography 
    Elon Musk is attracting a lot of attention nowadays, but there are not many biographies about his childhood and his  journey through Paypal, SpaceX and the other ventures.  This book enlightens us about how a great entrepreneur such as Elon Musk becomes as he is today.

All the best from Singapore.
Sukru Haskan
Twitter: @sukru_haskan

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Reading List: February 2018

Dear All,

As usual, time always flies. We are almost in the second month of 2018!

I hope that you have enjoyed the reading list of January 2018. Please give feedback by emailing me on!

I am publishing reading list February 2018 below.



Reading List: February 2018 

  1. Shoe Dog by Phil Knight
    Genre:Business, Biography 
    Founder of Nike, Phil Knight, talks about his journey with Nike. An inspiring true story of a giant brand which started with USD 50 loan from the founder’s father.
  2. Capital Without Borders by Brooke Harrington
    Genre:Business, Economics
    Brooke Harrington got into the world of wealth managers to figure out private banking world and share her invaluable insights about the industry.
  3. Empire by Niall Ferguson
    Genres: History
    Great book about British Empire on which sun never set at one point! Reading the book will enhance one’s vision to understand current conflicts in Asia, Africa and Middle East.
  4. Start with Why by Simon Sinek
    Genres: Business, Leadership
    Author argues that any initiative should start with a good reason rather than a materialistic short term target. Not only good reasoning helps companies and individuals to succeed, but more importantly to sustain for long term. Readers will find plenty of real-life examples from Apple and Google.
  5. Who moved my cheese? by Dr Spencer Johnson
    Genres: Business, Psychology
    A book to read in an hour, but to stay with you for a life time. It is a story of two mice and two men in a maze who are after their cheese. Their attitude towards change is highly affected by their backgrounds. It is a good guide on how to deal with change.

All the best from Singapore.
Sukru Haskan
Twitter: @sukru_haskan

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Unutilised Youth in Emerging Markets

I consider myself quite lucky that I can travel to many countries throughout the year for business and pleasure.

I had the chance to visit Athens after almost four years for a weekend and lately I was in Istanbul for a week. One of my latest observations is  that emerging countries, such as Greece and Turkey, are unable to utilise their very well educated youth not only in the labour force, but also in the social arena.

Consider Greece… Youth unemployment is close to 45 per cent and overall unemployment is around 25 per cent.

Consider Spain… Youth unemployment is close to 50 per cent and overall unemployment is around 22 per cent.

And finally Turkey… Youth unemployment is around 20 per cent and overall unemployment is around 10 percent.

A common point among all these countries—besides the fact that they are all Mediterranean—is that they have a highly educated minority youth population, whether they be not fully utilised in the labour force and inactive in the country’s social arena, or fully utilised in the labour force (very few of them), but again inactive in the social arena.

To be sure, a minority of the minority is active in the both arena and this is huge loss for these countries in closing the gap between them and highly developed nations.

Another common point among these countries is that there have been coup attempts and coups in their recent histories: a coup attempt in Spain in 1982, a coup in Greece in 1967–1974, and most recently, a coup attempt in Turkey in 2016.

Whether we like it or not, the common history of violence and coups has pushed the youth of these countries away from voluntary social  work and has made them completely apolitical, as well as more individualistic and disinterested in local/global issues.

Given that they are living in much better conditions than their peers, these groups of people live completely for themselves, make fun of everything and, more significantly, do not produce much.

It is no secret that all societies are becoming more individualistic, irrespective of the culture and countries that we live in, but it is always important to feed the soul as well as the stomach.

We should reincorporate these youths back into society and grow together! Unfortunately, I do not have a concrete plan to act upon, but I have the ambition to start somewhere!

All the best from a beautiful Mediterrean country.

Sukru Haskan
Twitter: @sukru_haskan

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Lecturing in China

I was honoured to give a short lecture on wealth management last week in Beijing at Renmin University. It was my first time in Beijing and I wish I could have spent more time discovering the city, but giving a short lecture was definitely more accommodating.

This has been my second teaching experience; my first one was in late 2014 at Singapore Management University.

Public speaking skill is a virtue which I really want to develop further, as it is always good to give back to society and meeting younger people to connect with different generations is always a great opportunity.

My session took about 45 minutes and I spoke about various aspects of wealth management such as its challenges and the opportunities ahead, along with its advantages and disadvantages compared to other departments in an ordinary bank.

What I am amazed by was the quality of the questions and the level of spoken English in the class.

It was such a good experience and I hope to avail of similar opportunities more regularly.

Thank you Eric Sim for the invitation!

All the best from Sri Lanka.

Sukru Haskan
Twitter: @sukru_haskan

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Book Review: Homo Deus

After reading Yuval Harari’s book, Sapiens: A Brief History of Humankind early this year, it was almost impossible not to read his next book, Homo Deus: A Brief History of Tomorrow as soon as it is published and I can get it.


Homo Deus is the second book written by Harari and talks about the future of mankind. Since Deus is “God” in Latin, he argues in his book that a new religion called Dataism to raise and humans will not need gods anymore since we will very accurately predict what will happen or who will do what by the help of gather data.

The book starts with striking statistics about the past and the present. Almost three million people–15% of the French population–starved to death between 1692 and 1694.  Today, more people are dying of diabetes, which is linked to being overweight rather than a result of starvation.  According to Harari, in 2014 more than two billion people were overweight compared to 850 million who suffered from malnutrition. Half of humankind is expected to be overweight by 2030.

Some of the quotes from the book that I really liked:

“Sugar is more dangerous than gunpowder”

“We don’t become satisfied by leading a peaceful and prosperous existence. Rather, we become satisfied when reality matches our expectations. The bad news is that as conditions improve, expectations balloon”

Does the above quote remind you of someone?

“Historians don’t ignore objective factors such as climate changes and genetic mutations, but they give much greater importance to the stories people invention and believe”

Like in his first book, Sapiens: A Brief History of Humankind, in Homo Deus Harari emphasizes the power of stories whether they are true or not. Actually my interpretation is; the less likely they are true and superficial, the more likely the people will listen.

Another point Harari argues is that humankind’s definition of knowledge has kept changing since the Agricultural Revolution. We were simple creatures during this time, so knowledge for reading the scriptures and applying and applying our logic.

“Knowledge= Scriptures x Logic”

Then the Scientific Revolution came and everything focused on collecting data and trying to find meaning for the gathered data.

“Knowledge = Empirical Data x Mathematics”

Finally in 21st century, as much as we are confident about ourselves, we care more about our life experiences and our sensitivities.

Another provocative fact that Harari argues is that there is no free will, and that free will can be manipulated. With the help of technology and data, machines know much better than what we will do or choose. Harari argues that companies are using this to manipulate us. In other words, Harari says what you think you want to do may not be really what you want to do.

He strengthens these points in the following sentence: “We are about to face a flood of extremely useful devices, tools and structures that make no allowance for the free will of individual humans”

Fascinating and provocative! Isn’t it!?

Harari also argues “In the 21st century we might witness the creation of a new massive class: people devoid of any economic, political or even artistic value, who contribute nothing to the prosperity, power and glory of society”  I personally did not get this point. Since societies are manipulated, how can they have this massive new class?

Some other provocative thoughts in the book are about collecting personal data.  Harari states “In the 21st century our personal data is probably the most valuable resource most humans still have to offer, and we are giving it to the tech giants in exchange for email services and funny cat videos”

“After 300 likes, Facebook algorithm can predict your opinions better than your husband or wife!

Yuval Harari is a young and great visionary writer. He definitely make my 2016 and led me to think as well as learn a lot!  He offers great opportunities for readers to think and learn. Harari’s Homo Deus is highly recommended.  His first book, Sapiens: A Brief History of Humankind is suggested as a prerequisite to Homo Deus.

I believe he will be in Istanbul on January, 25th which I am planning to fly and meet him in person!

Best Regards from Singapore.
Sukru Haskan

Twitter: @sukru_haskan

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Can Singapore model be applied in Turkey?

Following from my last article, I would like to find some answers as to whether Turkey could replicate the success of Suzhou Industrial Park in Diyarbakir.

Actually, some work has already been carried out in this field.

A reputable businessman and philanthropist, Erdal Aksoy, aims to replicate the project in Diyarbakir in order to create an eco-system for 1 million people in the region, including Syrian migrants.

Turkey has a strategic role in natural gas transit because of its position between the world’s second largest natural gas market, continental Europe, and the substantial natural gas reserves of the Caspian Basin and the Middle East.

Since Turkey is well placed to serve as a transit hub for oil and natural gas supplies as they move from Russia, Central Asia, and the Middle East to Europe and other Atlantic markets, the project is to develop an energy industrial park as the main platform to:

  • Create employment to improve lives in order to stabilise the region, particularly at the borders.
  • Leverage the energy resources and infrastructure in the region and target markets in Eastern Europe and Western Asia.
  • End the refugee crisis in Turkey and Europe.
  • Eradicate terrorism and maintain stability in the region.

The project will involve social housing (HDB equivalent in Singapore or council housing in the UK), education centres such as nurseries, primary schools, and universities, as well as hospitals for the health services.

To ensure that it is built on strong foundations, the project is intended to be a public private partnership involving the Turkish government and possibly other governments.

Surbana Jurong, a Singapore company that also provided the expertise for Suzhou Industrial Park, has already drafted the project and the Turkish government has already been briefed and promised support for the project.

The next step is to find other sustainable and strong partners, especially from Asian countries such as China and Singapore, to support the project.

Mr Aksoy is quite open to sharing the project with anyone that would like to enhance and take ownership of this huge socio-economic innovation.

The realisation of a project of this scale could bring stability and prosperity to the region, and could potentially be replicated in other parts of the Middle East.

Personally, I believe that this is an exciting project and that everyone who wishes to contribute to peace of Middle East shall be involved in it.

All the best from Singapore.
Sukru Haskan
Twitter: @sukru_haskan




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Suzhou Industrial Park in China

I had an opportunity to go Shanghai last weekend and I took the opportunity to visit Suzhou Industrial Park which is about 1.5 hours away from the city centre of Shanghai.


Suzhou Industrial Park is a landmark project between Chinese and Singaporean governments to create an ecosystem to enhance people’s lives through creating jobs, providing healthcare and education services.


In the late 1980s, when China modernisation gained momentum, Chinese delegations visited Singapore and they were eager to learn modern management methods from Singapore. In 1992, the idea of developing a modern industrial city with Singapore flourished when China’s leader Deng Xiaoping told the public that they must tap into Singapore’s experience and learn how to manage better from Singapore’s good social order.


After several rounds of discussion, both governments decided to develop a modern industrial park in the east of Suzhou, which was founded on February 1994 when Chinese Vice Premier Li Lanqing and Singapore Senior Minister Lee Kuan Yew signed an agreement on the joint development of Suzhou Industrial Park in Suzhou. Suzhou Industrial Park has a total jurisdiction of 288 km2 where China-Singapore cooperation area covers 80 km2 with a residential population of 1.2 million.

Of course, this huge project has gone through many different phases and there were a lot of disagreements with both governments during the journey. Because of these disagreements, Singapore has decreased its share in the park from 65% to 35%. Also, between 1994 and 2000, the park made huge losses. The profit between 2000 and 2003 has erased all the losses made during the period between 1994 and 2000.


The numbers speak for themselves today. Today, the park generates one of the highest incomes per capita in China. The regional GDP per capita is 257,900 yuan in Suzhou Industrial Park where Suzhou is 136,700 yuan and Jiangsu is 88,000 yuan. The per capita disposable income of urban residents in SIP is 56,696 yuan, in Suzhou 50,390 and 37,173 yuan in Jiangsu.

Another interesting statistic is that patents per ten thousand people are 86 in SIP, 25.46 in Suzhou and 14.22 in Jiangsu. A lot of international companies have presence in the park such as Bosch, Samsung, Hitachi, Nokia, Loreal and Panasonic.


Can Turkey copy this model in southeast of Turkey to generate economic growth, to educate Syrian migrants with the Southeastern Turkish population and most importantly to eradicate terrorism in the region?

I will write this in my next article in the coming days. Please keep following!

Best from Singapore.
Sukru Haskan

Twitter: @sukru_haskan

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Fintech idea #2: SmartBonds


Last week, I published the deposit shifting fintech idea and I got quite a lot of positive and negative feedback as to why it would work or not.

It is always great to get some feedback.

This week, I will publish another fintech idea which specifically targets retail and low end HNW clients.

As many of you know, USD denominated international bonds have been quite popular for the last few decades as interest rates were declining steadily and these bonds were a great source of income for investors.

Although with interest hikes in the coming years, the trend will not be that sexy anymore, there will always be an interest in the bond market since it provides a fixed income, unlike the uncertain and highly volatile equity and commodity markets.

These markets are not easily accessible by retail investors since many of new issue require a minimal nominal investment of USD 200K. This is a substantial amount of money and it keeps many investors out of this market.

SmartBond can solve this problem by aggregating demand and it can help retail investors to have access to international bonds.

Since there are many bonds in the market, SmartBonds can market bonds in a Groupon fashion (an e-commerce site which aggregates demand for specific products for a certain period with some discounts to its customer by achieving economics of scale). SmartBond can collect bond orders from retail clients and, once the minimum order amount is reached, it can trade in the market and allocate accordingly after the trade.

SmartBond will be a full pledged technology company like Groupon and it will not recommend any specific bonds to buy or sell. From this point of view like SmartDeposit, it should not be regulated as a financial institution.

Clients may choose to keep their bond holdings in any bank available through the SmartBond platform or in an institution of their own choice.

One may ask what would happen when the client wants to sell their holding since they will again need a minimum order amount of a nominal 200K. The same logic will apply and there will be sell platform along with a buy platform and once the order is aggregated, it will be executed.

In the beginning phase, it will not be possible to include all the bonds available for trading. According to the demand from clients, the platform can be enhanced and this could be a very profitable business if it reaches enough volume quickly.

Please continue to post your positive/negative feedback through my blog, twitter or email.

I will continue to write my ideas in the coming weeks.

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan



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Fintech business idea: SmartDeposit

I have a fintech idea ‒ actually I have more than one, but I will publish only this one as a start.


The environment of low interest rates has pushed many investors to hunt for a yield, and this has led many super-risky asset prices to skyrocket.

Especially, the extended period of ultra-low interest rates has hit pension funds and insurance companies hard, since they have to generate a certain level of income to ensure their sustainability and the ability to pay their liabilities.

High-net-worth individuals and retail clients are not happy either, since their capital is not working for them for the first time in history. Some of them are even paying banks to deposit currencies such as the euro, yen and Swiss franc, since banks are demanding that these investors are charged interest instead of receiving interest from them.

There is nothing new until now …

Everybody who follows the financial markets knows these facts very well.

What if these investors still want to invest simply in plain vanilla deposits but are happy to take higher credit risks in countries such as Brazil, Turkey, Russia or India?

Because of their counterparts’ risk parameters, these pension funds and insurance companies are mainly stuck with high-credit banks, such as all tier 1 global banks, and tier 1 global banks cannot offer any sexy interest rates.

Here, my idea kicks in ‒ what if they could place their deposits with low-investment-grade banks or even banks with junk credit quality that pay a much higher level of interest if they are happy with the risk?

The reams of paperwork for all different types of different banks and the regulatory requirements are a big hassle at the moment.

What if we could create a platform that can place deposits with many different banks without opening an account in each bank and simply shift the deposits from one to another when another bank in the world becomes more attractive?

It may be hard to attract institutional money in the first instance, but I believe high-net-worth (HNW) individuals and retail clients would be happy to test the proposition.

To visualize the idea, let us say that we open an account with ICICI in India, Garantibank in Turkey, VTB in Russia and BTG in Brazil. Assuming that ICICI offers 2.5% p.a., Garanti offers 3% p.a., VTB offers 3.25% p.a. and BTG offers 4% p.a., we can compare these with a tier 1 bank’s 0.30% p.a. deposit rate.

The investor can choose to place his deposit with any institution on the platform, so the availability of different institutions is an important factor to be attractive to investors. Clients will be able to place a deposit in India for a month and then shift it to Brazil in the next month.

The platform would enable emerging market banks to have a diversified deposit base and access to non-conventional HNW and retail investors from all around the world.

Since we are not advising clients and the deposits are held in segregated accounts for the tech company, how should our fintech be regulated? Just like banks or differently? I believe we should be much more lightly regulated.

It is a kind of UBER of finance ‒ simply a technology company facilitating a service rather than a bank.

The main challenge for this fintech would be the KYC (know your customer). It should be possible to know who is placing deposits and that the funds are coming from legitimate sources. We can overcome this hurdle with the help of blockchain technology, which will enable each investor’s details and transactions to be stored safely.

In addition, there is a new business opportunity here to create a global KYC company in which the banks are also stakeholders so that a verified KYC could be used between different banks instead of providing each different bank with thick sets of paper.

Regulators are really the key in this business idea, and they will be the key in any fintech ideas. They will decide whether to kill the fintechs in favour of conventional banks or help them to thrive. Many regulators, such as those in Singapore, the UK and Switzerland, are really helping this industry to excel, so I am quite optimistic.

I will publish another fintech idea for retail clients next week. If you would like to exchange ideas and/or simply discuss matters, please keep in touch through my blog, twitter or email.

All the best from Singapore,

Sukru Haskan
Twitter: sukru_haskan

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