News & Commentary:

Articles/Commentary

May is right to be cautious about China trade links
FT View Feb 1, 2018
The UK should not give blanket support to risky infrastructure projects.

Making the right choice on education in emerging markets
Gayle Smith (FT) Feb 1, 2018
Investment in the poorest countries promises life-changing benefits.

China believes in free and fair trade, too
Gu Bin (FT) Feb 1, 2018
The Chinese model of a market economy is just different from traditional western ones.

Vietnam has a cryptocurrency dilemma
Nate Fischler (AT) Feb 1, 2018
Legal ambiguity means courts, law enforcement and tax authorities are all dealing differently with virtual money

NAFTA Parties Wrap Up Anti-Corruption Chapter, Acknowledge Continued Divides
Bridges, Volume 22, Number 3 Feb 1, 2018
Ministers from the North American Free Trade Agreement (NAFTA) countries said on Monday 29 January that they had essentially wrapped up a chapter on anti-corruption and advanced in various other negotiating areas, while acknowledging that deep divides still remain on the more contentious topics.

Davos Meet Wraps Up, As Speakers Outline Approaches to Global Economic Cooperation
Bridges, Volume 22, Number 3 Feb 1, 2018
The World Economic Forum’s (WEF) Annual Meeting in Davos, Switzerland, wrapped up on Friday 26 January, capping several days of high-level speeches and meetings on the global economy, inclusive growth, sustainability, and multilateralism.

UK, China Leaders to Weigh Deeper Trade Ties, Economic Integration
Bridges, Volume 22, Number 3 Feb 1, 2018
UK Prime Minister Theresa May is travelling through China this week for a series of talks with Chinese officials, with the meetings slated to focus on potential areas for deeper trade and economic integration, as well as trade irritants or concerns.

A New Agenda for the MDBs: Five Practical Reforms
Mark Plant (CGD) Feb 1, 2018
Today, the Center for Global Development, the Brookings Institution, and the Overseas Development Institute released The New Global Agenda and the Future of the MDB System, a report we jointly prepared as input to the deliberations of the G20-convened Eminent Persons Group on Global Financial Governance. We argue that current global economic challenges require a rethink of the role that multilateral development banks (MDBs) can play in developing countries. Here are the top five areas where MDB reform is needed to help meet the 2030 Sustainable Development Goals:

Bitcoin Is Not a Systemic Risk—Yet
Brink Feb 1, 2018
A large majority of leading European economists do not believe that cryptocurrencies are a threat to the financial system, though they want to see them placed under greater regulatory oversight. Economists said that the total value of cryptocurrencies is too small to pose a systemic risk, but they are concerned about their use for money laundering and tax evasion.

Brexit Politics Goes From Bad to Worse
Bloomberg View Feb 1, 2018
The split in Britain's Conservative Party is doing enormous damage.

The Fed's Dilemma Isn't Going Away Under Powell
Gary Shilling (Bloomberg View) Feb 1, 2018
Inflation and wage increases continue to undershoot expectations at the same time the central bank confronts forces pressuring it to credit tightening.

If the Fed Is Right, Then Markets Are in Trouble
Jim Bianco (Bloomberg View) Feb 1, 2018
Meeting the 2 percent inflation goal could signal a downturn.

Burying the Legal Ghosts of Brazil’s Hyperinflation
Camila Villard Duran and Arnoldo Wald (Project Syndicate) Feb 1, 2018
Three decades after a series of failed stabilization policies wiped out many Brazilians' savings, a legal fight over compensation appears to be nearing an end. But more than a long-awaited payday for some one million claimants, the restitution will also mark an end to Brazil's seemingly endless war on hyperinflation.

Post-Davos Depression
Joseph E. Stiglitz (Project Syndicate) Feb 1, 2018
The CEOs of Davos were euphoric this year about the return to growth, strong profits, and soaring executive compensation. Economists reminded them that this growth is not sustainable, and has never been inclusive; but in a world where greed is always good, such arguments have little impact.

Russia’s Economic Stagnation Is Here to Stay
Konstantin Sonin (Project Syndicate) Feb 1, 2018
The Russian economy is stagnating across almost all sectors, meaning that boosting growth will be impossible without deep structural reforms. But with President Vladimir Putin approaching a fourth term after having shown little appetite for such reform, there is no reason to expect much to change in the foreseeable future.

Banking crisis, bail-ins and money holdings: Lessons from Cyprus
Martin Brown, Ioanna S Evangelou and Helmut Stix (VoxEU) Feb 1, 2018
A cornerstone of new bank resolution policies across the world is the introduction of bail-ins to redistribute the costs of bank failures from taxpayers to bank creditors. This column uses the bail-in of two banks in Cyprus to examine how bank depositors react to this way of resolving a crisis. In the short run, customers who experienced deposit or bond bail-ins increased their holdings of cash and reduced deposits, while those who faced only an equity bail-in did not change their behaviour. In the medium run, confidence in the banking system among all depositors remained low.

Economic crisis and structural reforms in Southern Europe
Paolo Manasse and Dimitris Katsikas (VoxEU) Feb 1, 2018
The basic ingredients of the policy prescriptions in response to the euro area debt crisis were quite similar across Southern Europe. This column explores the economic, political, and institutional factors that differentially affected the success of these prescriptions from country to country. Policy timing and sequencing, the balance between fiscal consolidation and structural reforms, and external constraints all play crucial roles. Future reform programmes should be calibrated to the distinct economic, social, and political features of targeted countries.

The remarkable revival of US oil production
FT View Feb 2, 2018
Shale is shaking up global markets to mostly positive effect.

Beijing uses its advantage to press May on trade
Isabel Hilton (FT) Feb 2, 2018
The visit offered the painful sight of Britain’s prime minister under savage attack.

Renminbi flies after Beijing removes shackles
Steve Johnson (FT) Feb 2, 2018
China has stopped trying to hold its currency down in the wake of Trump trade tensions.

Blockchain good, cryptocurrencies bad. How true?
Richard Cook (AT) Feb 2, 2018
Examples of clever 'token tech' starting to work in the mainstream financial world suggest it may be too early to start ringing the crypto death bell

Inside the IFC's Portfolio: The IFC Responds
Charles Kenny and Vijaya Ramachandran (CGD) Feb 2, 2018
IFC Spokesman Frederick Jones has replied to our blog on the IFC’s risk appetite. First off, thanks to Fred and the IFC for replying. The Corporation has a unique role to play in global development finance and we’re keen for that role to grow, so we’re happy that the report has generated so much conversation about IFC’s portfolio, both within and outside IFC. And second, we commend IFC for its plans to do more in poor countries and those that are classified as fragile states—it is where the Corporation can have the most impact and where it is most needed.

How Trustworthy Is Big Data?
Timo Elliott (Brink) Feb 2, 2018
Over the last decade, big data has gone from being used in niche applications to becoming an increasingly mainstream part of modern business. But compared to traditional IT architectures, there’s typically a lot less control and governance built into big data systems. So how can businesses actually trust the data coming from these new systems?

The Market's Goldilocks Era Is Nearing an End
Lars Christensen (Bloomberg View) Feb 2, 2018
It seems like a good time to take a more cautious approach to U.S. and global stocks.

Bank of Japan Is Missing a Big Opportunity
Daniel Moss (Bloomberg View) Feb 2, 2018
Investors think things are looking up. Central bankers should stop telling them they're wrong.

India Takes a Wrong Turn
Mihir Sharma (Bloomberg View) Feb 2, 2018
The government is casting aside its one true achievement.

Universities in the Age of AI
Andrew Wachtel (Project Syndicate) Feb 2, 2018
Over the next 50 years or so, as AI and machine learning become more powerful, human labor will be cannibalized by technologies that outperform people in nearly every job function. How should higher education prepare students for this eventuality?

Could the Renminbi Challenge the Dollar?
Christopher Smart (Project Syndicate) Feb 2, 2018
China’s rapid economic growth, coupled with savvy monetary management by its leaders, has internationalized the renminbi to a degree that scarcely could have been imagined just a few decades ago. But if China’s leaders ever want to challenge the US for global currency dominance, they will need to think and act more radically.

The Bitcoin Threat
Harold James (Project Syndicate) Feb 2, 2018
Unless a currency has been authenticated by a government, it is unlikely to be fully trusted. But that does not mean that it cannot become a plaything for the naïve and gullible, or a weapon of financial mass destruction for political belligerents around the world.

Upgrading outputs means upgrading inputs
Paulo Bastos, Joana Silva and Eric Verhoogen (VoxDev) Feb 2, 2018
Success when exporting to richer countries requires upgrading the quality of products, but also of inputs.

Why Is China Buying Up Europe’s Ports?
Keith Johnson (FP) Feb 2, 2018
Chinese state-owned port operators are the aggressive leading edge of Beijing’s massive Belt and Road project.

Whisper it, Germany can afford higher inflation
FT View Feb 3, 2018
There is limited evidence of overheating, despite the streak of growth.

Pyramid schemes cause huge social harm in China
Economist Feb 3, 2018
Crackdowns may not be working.

This is what an immigration policy for the 21st century should actually look like
Robert J. Samuelson (WP) Feb 4, 2018
How quickly should we absorb immigrants, and who should they be?

Powell’s challenge at the Fed
Lawrence Summers (FT) Feb 4, 2018
He must work out how to achieve growth that is adequate and financially sustainable.

Anatomy of the escalating bond bear market
Gavyn Davies (FT) Feb 4, 2018
With term premia now back to ‘normal’ bonds look better underpinned.

There’s good news behind higher bond yields
Mohamed El-Erian (FT) Feb 4, 2018
Despite a risk of a disorderly sell-off, yields are rising because of faster growth and inflation.

Modi will struggle to meet promises to poor
FT View Feb 5, 2018
The prime minister shows signs of weakness ahead of next year’s polls.

Guyana and the oil curse
Nick Butler (FT) Feb 5, 2018
The commodity can bring both wealth and trouble and it is easy to think of countries that have been damaged by its discovery.

The Return to Normal Risk
WSJ Feb 5, 2018
Equity markets welcome Jay Powell as Federal Reserve Chairman.

Has Trumphoria Finally Hit a Wall?
Paul Krugman (NYT) Feb 5, 2018
The market isn’t the economy; still, it looks as if reality is breaking in.

The stock market dive might actually mean good news for the economy
Sebastian Mallaby (WP) Feb 5, 2018
The cloud that has hung since 2008 could be lifting.

World markets crash, except for China
David P. Goldman (AT) Feb 5, 2018
Far from being the source of risk, China looks like an island of stability.

Inside Asia’s love-hate relationship with virtual currencies
William Pesek (AT) Feb 5, 2018
The debate around Bitcoin and its many clones swings from absurdity to unstoppable bullishness to real-world consequences – often all in the same day

India: Massive Expansion in Schooling, Too Little Learning, Now What?
Lant Pritchett (CGD) Feb 5, 2018
The main story of the youth assessment is a massive mismatch between their aspirations of how they will be able to use their schooling and their actual capability.

A Change in World Bank Methodology (Not Reform) Explains India’s Rise in Doing Business Rankings
Justin Sandefur and Divyanshi Wadhwa (CGD) Feb 5, 2018
While Modi has celebrated India’s rapid rise in the Doing Business rankings, the World Bank’s Chief Economist recently resigned amid controversy over methodological changes. Without those changes, India’s “jump” in the rankings looks much more modest.

Energy Access Is Critical to Economic Growth
Molly A. Walton (Brink) Feb 5, 2018
In recent years, the way we think about energy and development has started to shift, and measurable progress is now being made on energy access. But despite this, some 1.1 billion people globally still lack access to electricity, and 2.8 billion people lack access to clean cooking facilities.

Extend and Pretend Can't Work Forever
Satyajit Das (Bloomberg View) Feb 5, 2018
Around the world, current benefits and future costs are dangerously unbalanced.

Why the Growth Bears Have It Wrong
Neil Dutta (Bloomberg View) Feb 5, 2018
U.S. domestic demand is expanding at the fastest pace in three years.

Inclusive Growth or Else
Sergei Guriev, Danny Leipziger and Jonathan D. Ostry (Project Syndicate) Feb 5, 2018
The decision to place inequality at the center of the discussion at Davos this year was a promising development. But actual solutions remain undeveloped, and concern about widening economic disparities within many countries remains inadequate, which must change if the current global economic recovery is to continue.

When Will Tech Disrupt Higher Education?
Kenneth Rogoff (Project Syndicate) Feb 5, 2018
Universities pride themselves on producing creative ideas that disrupt the rest of society, yet higher-education teaching techniques continue to evolve at a glacial pace. Given education’s centrality to raising productivity, shouldn’t efforts to reinvigorate today’s sclerotic Western economies focus on how to reinvent higher education?

Recent developments in the regulatory treatment of sovereign exposures
Michele Lanotte and Pietro Tommasino (VoxEU) Feb 5, 2018
Late last year, the Basel Committee decided to maintain the status quo regarding regulation of banks’ sovereign debt holdings. This column summarises the reasons to be cautious of stricter regulation of banks’ sovereign exposures. Theory and experience suggest small net benefits from such a reform, with possible increases in tail risks. The best instrument to tackle the problem is not microprudential regulation, but sounder public finances and the completion of the banking union.

Hungary and Poland Aren’t Democratic. They’re Authoritarian.
Dalibor Rohac (FP) Feb 5, 2018
Central Europe’s populist revolt against the European Union isn’t about safeguarding the West. It’s about rolling back freedoms and cozying up to Russia.

Expecting the Expected: Staying Calm When the Data Meet the Forecasts
John C. Williams (FRBSF Econ Letter) Feb 5, 2018
The expansion is proceeding at a good pace, unemployment is low, and inflation is finally headed in the right direction. The data show no signs of an economy going into overdrive. This suggests that further gradual increases in interest rates are likely in 2018, assuming the data continue to come in largely as expected.

Algorithms at work risk management by numbers
Sarah O'Connor (FT) Feb 6, 2018
In the quest for more efficiency, companies should be wary of losing the human touch.

A threat that could upend the economy
Lance Fritz (WP) Feb 6, 2018
Business is booming, thanks to tax reform. Exiting NAFTA would undo that progress.

Oil majors’ misery shows what the market is worried about
David P. Goldman (AT) Feb 6, 2018
A 'capital light' recovery has left the US economy with a backlog of capital spending; companies now have to play catch up

Energy for Education Is Vital for Developing Economies
Lawrence E. Jones, Emmanuel K. Akyeampong, Chris Kutarna, and Jacek Jaroslaw Jasieniak (Brink) Feb 6, 2018
An estimated 188 million children—equal to one in three globally—attend schools that have no lights, no running water, no refrigerators, no fans, no computers or printers. As young populations grow rapidly and economic opportunities emerge, one question looms large: Will the available workforce be properly equipped in terms of literacy and skills to fulfill emerging job opportunities?

Why a Dip in Asset Prices Might Be a Good Thing
Tyler Cowen (Bloomberg View) Feb 6, 2018
There's a lot of wealth being created and not enough safe places to store it.

Falling Stocks and Rising Yields Aren't the New Normal
Komal S Sri-Kumar (Bloomberg View) Feb 6, 2018
The medium-term outlook will be determined by Trump's policies on trade and the dollar.

Decision Time at Bank Indonesia
Daniel Moss (Bloomberg View) Feb 6, 2018
The current governor deserves another term. But his future is unavoidably tied to the Fed.

Presidents Can Weather Market Meltdowns
Jonathan Bernstein (Bloomberg View) Feb 6, 2018
The electoral problems start when equity losses turn into deeper slumps.

Don't Forget What Causes a Recession
Noah Smith (Bloomberg View) Feb 6, 2018
They have this nasty habit of showing up when least expected.

Markets Are Trapped as Policy Experiments Collide
Joseph G Carson (Bloomberg View) Feb 6, 2018
Unconventional monetary policy is reversing at the same time as a bold and risky fiscal spending plan is being enacted.

The revenge of the places that don't matter
Andrés Rodríguez-Pose (VoxEU) Feb 6, 2018
Persistent poverty, economic decay and lack of opportunities cause discontent in declining regions, while policymakers reason that successful agglomeration economies drive economic dynamism, and that regeneration has failed. This column argues that this disconnect has led many of these ‘places that don’t matter’ to revolt in a wave of political populism with strong territorial, rather than social, foundations. Better territorial development policies are needed that tap potential and provide opportunities to those people living in the places that ‘don’t matter’.

Population policies and fertility convergence
Tiloka de Silva and Silvana Tenreyro (VoxDev) Feb 6, 2018
While urbanisation and socioeconomic factors played a role, the global decline in fertility is largely due to successful population control programmes.

US abdication in Africa hands China opportunities
David Pilling (FT) Feb 7, 2018
China’s influence is everywhere: in roads, rail, telecoms and infrastructure.

Modi’s India is on course to top China for growth
Martin Wolf (FT) Feb 7, 2018
Further business and legal reforms are needed to maintain progress.

On Immigration, Do as the Romans Did
Gerard J. Tellis and Stav Rosenzweig (WSJ) Feb 7, 2018
For 2,000 years, countries that embrace outsiders have risen, while closed societies have stagnated.

The Two Faces of Middle East Economies
Masood Ahmed (CGD) Feb 7, 2018
Like the mythical Roman god Janus, there are two faces to most of the economies of the MENA region. We can call them the young and the old. And that the choice for MENA governments to make is not which face of Janus to support, but rather how to ensure that both can co-exist and prosper.

Let Us Eradicate Poverty, Not Demolish Wealth
Daniel Lacalle (Mises Wire) Feb 7, 2018
We are living in a time when actual poverty reduction is ignored to focus on interventionist messages about "inequality."

Market Turmoil Isn't Enough to Make the Fed Change Its Plans
Timothy A Duy (Bloomberg View) Feb 7, 2018
It would take more upheaval to alter the fundamental outlook for rates or the economy.

Is the Stock Market Loaded for Bear?
Dambisa Moyo (Project Syndicate) Feb 7, 2018
As 2018 progresses, business leaders and market participants should – and undoubtedly will – bear in mind that we are moving ever closer to the date when payment for today’s recovery will fall due. The capital market gyrations of recent days suggest that awareness of the inevitable reckoning is already beginning to dawn.

Future drivers of labour force participation growth in Europe
Cristina Fernández and David Martínez Turégano (VoxEU) Feb 7, 2018
European labour force participation has increased over recent decades, fuelled in large part by increased female labour participation, improvements in education levels, and socioeconomic factors. This column explores whether this trend will continue, or whether we will see a decline similar to that in the US. Results indicate that while Europe’s labour participation is not on the verge of a reversal, targeted policies will need to take over from socio-educational developments in driving further growth.

Measuring Chinese Shadow Banking: Banks’ Shadow and Traditional Shadow Banking
Guofeng Sun (VoxChina) Feb 7, 2018
Shadow banking in China includes an important role for Banks’ Shadow in the credit money creation process, which poses challenges to monetary policy regulation and financial risk management. I urge regulators to closely track the evolution of various shadow banking channels both on- and off-balance sheet. To strengthen supervision, separate macro-prudential regulation tools, such as asset reserves and risk reserves, are needed for Banks’ Shadow and Traditional Shadow Banking, respectively.

Goldilocks, Keynes, and Fluctuations in the Stock Market
John Cassidy (New Yorker) Feb 7, 2018
When markets are trading at extremely high levels, they are sensitive to sudden changes in sentiment, and that is what we are now witnessing.

The Surprising Success of Putinomics
Chris Miller (FA) Feb 7, 2018
Behind Putin's formula for holding onto power.

Trade deficit reality starts to bite for Trump
FT View Feb 8, 2018
The White House is slowly discovering the limitations of US policy.

The corporate debt problem refuses to recede
Gillian Tett (FT) Feb 8, 2018
Non-financial leverage is higher today than it was before the crisis.

A union pay victory that central bankers can cheer
Claire Jones (FT) Feb 8, 2018
IG Metall deal could help eurozone central bankers hit inflation target.

Pacific Alliance, Associate Members Advance Trade Talks, Eye New Economic Opportunities
Bridges, Volume 22, Number 4 Feb 8, 2018
The second round of the Pacific Alliance’s negotiations with its potential “associate members” wrapped up on Friday 2 February in Gold Coast, Australia, with officials from the countries involved reporting steady advances in the talks across various subject areas.

Brazil Circulates Proposal for WTO Investment Facilitation Deal
Bridges, Volume 22, Number 4 Feb 8, 2018
Brazil submitted an extensive draft proposal for a potential agreement on investment facilitation to the WTO’s General Council last week, in a bid to jumpstart more “structured discussions” on the subject.

WTO Roundup: New Safeguard Consultation Requests on US Tariffs, Biodiesel Case Update
Bridges, Volume 22, Number 4 Feb 8, 2018
The past few weeks have seen a series of developments within WTO dispute settlement, including the filing of new cases as well as the release of a long-awaited panel report on European duties involving imported biodiesel from Indonesia.

Are Equity Markets Anticipating a Macroeconomic Regime Change?
Tiffany Wilding (PIMCO) Feb 8, 2018
The U.S. is starting to look more like an economy that is in the later stages of its business cycle.

Tax and Development: Beyond the Big Numbers
Maya Forstater (CGD) Feb 8, 2018
Discussion on tax and development can be incoherent, both within and between different sectors. A symptom of this is the tendency for inflated expectations about the scale of revenues at stake in relation to multinational corporations and misunderstandings and contested definitions on the issue of illicit financial flows.

Regulators Need to Look Hard at Bitcoin
Bloomberg View Feb 8, 2018
Cryptocurrencies and the speculative mania surrounding them pose a financial risk.

Amid Market Turmoil, Where's China?
Daniel Moss (Bloomberg View) Feb 8, 2018
China's economy is growing fast. But its capital markets still punch below their weight.

A Strong Dollar Is Just What the U.S. Needs
Jared Dillian (Bloomberg View) Feb 8, 2018
It forces manufacturers to become more competitive against foreign rivals.

Crypto Cynics Stand to Profit the Most
Noah Smith (Bloomberg View) Feb 8, 2018
Bubbles look like a uniquely predatory financial phenomenon.

How the 'Places That Don't Matter' Fueled Populism
Leonid Bershidsky (Bloomberg View) Feb 8, 2018
A geographer's new theory puts regional inequality ahead of personal inequity as a cause of revolt.

Germany's Wage Deal Is Good for Europe Too
Ferdinando Giugliano (Bloomberg View) Feb 8, 2018
The end of pay moderation will help the European Central Bank meet its inflation target.

Stock Bulls Better Be Careful What They Wish For
Jim Bianco (Bloomberg View) Feb 8, 2018
Rather than acting as a tailwind to stocks, faster inflation may actually prove to be a headwind.

Pay-or-Play Capitalism
Jim O'Neill (Project Syndicate) Feb 8, 2018
Too many corporate executives have forgotten the principle of enlightened self-interest. But rather than wait around for CEOs to see that healthy societies are essential to their firms' own long-term success, policymakers should start imposing costs on companies that free-ride on public and social goods.

India’s Path From Crony Socialism to Stigmatized Capitalism
Arvind Subramanian (Project Syndicate) Feb 8, 2018
Over the past few years, the Indian government has pursued far-reaching economic reforms to address the twin problems of overly indebted private-sector firms and under-capitalized public-sector banks. But, more fundamentally, the government is finally trying to deliver the country from the legacy of its socialist past.

India’s Path From Crony Socialism to Stigmatized Capitalism
Arvind Subramanian (Project Syndicate) Feb 8, 2018
Over the past few years, the Indian government has pursued far-reaching economic reforms to address the twin problems of overly indebted private-sector firms and under-capitalized public-sector banks. But, more fundamentally, the government is finally trying to deliver the country from the legacy of its socialist past.

Measuring Chinese Shadow Banking: Banks’ Shadow and Traditional Shadow Banking
Guofeng Sun (VoxChina) Feb 8, 2018
Shadow banking in China includes an important role for Banks’ Shadow in the credit money creation process, which poses challenges to monetary policy regulation and financial risk management. I urge regulators to closely track the evolution of various shadow banking channels both on- and off-balance sheet. To strengthen supervision, separate macro-prudential regulation tools, such as asset reserves and risk reserves, are needed for Banks’ Shadow and Traditional Shadow Banking, respectively.

Economic predictions with big data: The illusion of sparsity
Domenico Giannone, Michele Lenza and Giorgio Primiceri (VoxEU) Feb 8, 2018
The availability of large datasets has sparked interest in predictive models with many possible predictors. Using six examples of data from macroeconomics, microeconomics, and finance, this column argues that it is not usually possible to identify sparse models by selecting a handful of predictors from these larger pools. The idea that economic data are informative enough to identify sparse predictive models might be an illusion.

The euro area economy is shedding the crisis legacies
Marco Buti, Björn Döhring and José Leandro (VoxEU) Feb 8, 2018
The outlook for the euro area economy depends to a large extent on whether the impact of the crisis will turn out to be permanent or transitory. This column attempts to chart out the path ahead, starting from what different narratives of the 'atypical recovery' imply about the further trajectory of GDP and inflation. In view of remaining slack, and barring an exogenous shock or policy mistakes, there is scope for solid GDP growth above potential for some time. The factors that should eventually drive an increase in core inflation are gaining force, but only gradually. The current supportive policy mix is thus appropriate for the euro area as a whole, but reforms that raise productivity and increase the economy's resilience to shocks should be accelerated.

Volatility Returns to the Global Economy
David Dapice (YaleGlobal) Feb 8, 2018
The United States, world’s largest economy, adds to global market worries with tax cuts, treasury yields, trade wars and talk of treason

Where Brexit hits hard, a customs union will help
FT View Feb 9, 2018
The regions of the UK that voted to leave have the most to lose.

The Stock Market Has Turned Nasty. It Was Long Overdue.
Jeff Sommer (NYT) Feb 9, 2018
Losses mounted in the markets this past week. The downturn is a reminder that while stock investing has been profitable over the long run, it is a risky and often painful pursuit, our columnist says

Will China Impose a New World Order?
Tunku Varadarajan (WSJ) Feb 9, 2018
When Pax Britannica gave way to Pax Americana, the transition was peaceful. A repeat is unlikely, says the author of ‘Safe Passage.’

Governments eye their own blockchain cryptocurrencies
Lucas Mearian (CW) Feb 9, 2018
This year will see the maturation of blockchain, as 2017's pilot projects turn into 2018's real-world implementations in a variety of industries. That includes governments, some of whom are now testing cryptocurrencies as fiat money.

Is This Week's Mini-Crash Just the Beginning?
Brendan Brown (Mises Wire) Feb 9, 2018
The shaky stock market will shake investor confidence, and spells trouble for the future of the current boom.

Wrong Criticisms of Doing Business
Shanta Devarajan (CGD) Feb 9, 2018
While I welcome criticism and comments on the Doing Business (DB) report—or any other data and research product of the World Bank, for that matter—I find Justin Sandefur’s and Divyanshi Wadhwa’s recent blog posts on DB in Chile and India neither enlightening nor useful.

The Pitfalls of Leverage Targets
Paddy Carter (CGD) Feb 9, 2018
Since the 2015 financing for development agreement, donor governments and their development finance institutions have all been singing from the same hymn sheet: we must do more to mobilize private investment. Here I will argue that setting leverage targets in isolation might not get us what we want: more investment in developing countries. Overall investment volumes in chosen markets may make a better target, but any incentives must be soft to minimize the temptation to put public money where it is not needed.

A New Era for China's Central Bank
Daniel Moss (Bloomberg View) Feb 9, 2018
The next governor of the PBOC will have his work cut out for him.

The U.K. Is Down Since Brexit. Guess Who's Up.
Matthew A Winkler (Bloomberg View) Feb 9, 2018
Greece is growing faster than the U.K. and is outperforming it in financial markets.

Market Turmoil Won't Deter Central Banks
Mohamed Aly El-Erian (Bloomberg View) Feb 9, 2018
The Bank of England signaled that it will continue to shift toward less stimulative policies.

Inverse Volatility Products Almost Worked
Matthew S Levine (Bloomberg View) Feb 9, 2018
And people like them so much they keep coming back for more.

Piketty Thinks the EU Is Bad for Eastern Europe. He's Half Right.
Leonid Bershidsky (Bloomberg View) Feb 9, 2018
Economic colonization by western Europe works differently than the rock star economist believes.

Lessons From a Slow-Motion Robot Takeover
Virginia Postrel (Bloomberg View) Feb 9, 2018
Cotton harvesting is now dominated by machines. But it took decades to happen.

The World Bank Needs to Return to Its Mission
Jeffrey D. Sachs (Project Syndicate) Feb 9, 2018
With a clear plan, the World Bank would be able to find partners to help it support progress toward achieving the Sustainable Development Goals, which has been disappointing so far. Instead, the Bank is adopting an approach that would leave poor countries mired in debt, by relying on Wall Street to finance their basic needs.

The Chinese banking system
Eugenio Cerutti and Haonan Zhou (VoxEU) Feb 9, 2018
Chinese banks have continued to expand rapidly both domestically and abroad. Together, they constitute the largest banking sector in the world by far. This column places the Chinese banking system in a global context. Although very small relative to their domestic claims, Chinese banks’ foreign claims are substantial for many borrower countries in Asia, Africa, and the Caribbean in particular. Many of these banking connections are related to Chinese outward foreign direct investment, with fewer related to trade linkages.

Does Fair Trade work?
Raluca Dragusanu and Nathan Nunn (VoxDev) Feb 9, 2018
Fair Trade coffee produced in Costa Rica benefits the producers and skilled workers, but not the unskilled workers.

Era of market tranquility comes to an abrupt end
Nicole Bullock, Eric Platt and Alexandra Scaggs (FT) Feb 10, 2018
Wall Street suffered its worst week in years as investors grasped that the era of cheap money is set to disappear.

10 Things to Know About the Stock-Market Selloff
Mohamed Aly El-Erian (Bloomberg View) Feb 10, 2018
Experienced investors understand how hard it is to call a bottom.

Markets Show What They Don't Know About Derivatives
Dean C Curnutt (Bloomberg View) Feb 10, 2018
An unvirtuous cycle of new money is pushing prices higher in a chase for returns.

There's a Crack Between the U.S. and Europe Over China
Henry Brands (Bloomberg View) Feb 10, 2018
Transatlantic differences over Beijing's rise threaten the future of the liberal world order.

Rising 10-Year Yields Point to Higher Commodity Prices
Shelley Goldberg (Bloomberg View) Feb 10, 2018
If long-term rates rise enough, investors will turn to gold and crude oil.

Equity melt up turns towards melt down
Gavyn Davies (FT) Feb 11, 2018
Volatility is back as equity markets pay attention to inflation and interest rate risks.

Inflation Stalks Macri in Argentina
Mary Anastasia O’Grady (WSJ) Feb 11, 2018
The Peronists hope to end his presidency prematurely. They may well succeed.

The one-word reason Congress’s debt deal should worry us
Robert J. Samuelson (WP) Feb 11, 2018
We don’t know where the line is on deficit spending. Let’s not find out.

Global trade and the dollar
Emine Boz, Gita Gopinath and Mikkel Plagborg-Moller (VoxEU) Feb 11, 2018
In international macroeconomics, it is typically assumed that the exchange rate between two trading partners matters most for trade prices, quantities, and terms of trade. This column presents evidence supporting an alternate view – that a country’s exchange rate relative to the US dollar is most important. This is because invoicing in dollars is common, even when the US is not part of a transaction. The findings have important implications for the conduct of monetary and exchange rate policies.

America’s balancing act on debt grows trickier
FT View Feb 12, 2018
The budget drama was resolved, but the day of reckoning still looms.

Why South Africa matters to the world
Gideon Rachman (FT) Feb 12, 2018
As it awaits the departure of Jacob Zuma, the country’s future hangs in the balance.

Trump’s warnings about unfair trade with China ring true
Nick Butler (FT) Feb 12, 2018
There is no sign that Beijing accepts the responsibilities needed to build stronger links.

Drillers turn to big data in the hunt for more, cheaper oil
Ed Crooks (FT) Feb 12, 2018
Under pressure from renewables, energy groups are again looking to tech for answers.

Congress Flirts With Disaster on Bank Leverage Ratios
Sheila Bair (WSJ) Feb 12, 2018
Legislators who want to weaken capital standards must have forgotten the lessons of the 2008 crisis.

China will not fall into the ‘Thucydides Trap’ with India
Pepe Escobar (AT) Feb 12, 2018
President Xi Jinping projects China as a 'benevolent power' but at the Raisina Dialogue in Delhi the 'Quad' nations lined up against him.

How Trump’s weak dollar could backfire
William Pesek (AT) Feb 12, 2018
The rising yuan could mean it's open season on American companies for acquisitive mainlanders.

African Migration to Europe Is Not a Crisis. It’s an Opportunity.
Masood Ahmed and Kate Gough (CGD) Feb 12, 2018
An increasingly common justification for European development assistance to Africa is the notion that it will reduce migration from the South. While this sounds intuitive and makes for an appealing argument, the research shows that it is highly unlikely. As communities become less poor, more people gain the abilities and wherewithal to undertake an expensive journey to a better life elsewhere. Development often increases migration—at least initially.

How Can Foreign Firms Avoid Corruption in U.S.?
Richard Levick (Brink) Feb 12, 2018
Despite assumptions that enforcement of the Foreign Corrupt Practices Act might slow to a crawl, nothing could be further from the truth. For complex organizations, knowing how to communicate in America is not only the wise thing to do, it is a business imperative.

Where the System Works in India
Mihir Sharma (Bloomberg View) Feb 12, 2018
The strength of its institutions and civil society should reassure foreign investors.

Where China Can and Can't Innovate
Adam Minter (Bloomberg View) Feb 12, 2018
Some new technologies may be developing too fast for official tastes.

The Bank of England Would Do Better to Wait
Ferdinando Giugliano (Bloomberg View) Feb 12, 2018
The best strategy until Brexit is settled is a simple one: Do nothing.

Why the World Is Watching U.S. Interest Rates
Mark Whitehouse (Bloomberg View) Feb 12, 2018
Foreign governments and companies owe more in dollars than ever before.

The Lessons of Black Monday
Barry Eichengreen (Project Syndicate) Feb 12, 2018
When interpreting sharp drops in stock prices and their impact, many will think back to 2008 and the market turbulence surrounding Lehman Brothers’ bankruptcy filing. But a better historical precedent for current conditions is the huge one-day drop on October 19, 1987.

The Future of Economic Convergence
Kemal Dervis (Project Syndicate) Feb 12, 2018
If developing economies are to continue to converge with their advanced counterparts, they will need to deploy new technologies relatively efficiently, taking into account the role of labor-market skills and regulations. This will not be easy, but it is possible – and, indeed, necessary.

Populism’s Second Wind
Zaki Laïdi (Project Syndicate) Feb 12, 2018
An economic-growth uptick, together with the election of French President Emmanuel Macron, suggest that Europe's travails may be behind it. But recent elections in Austria, Germany, and the Czech Republic tell a different story.

Hawks and doves: Deeds and words - new eBook on the economics and politics of monetary policymaking
Sylvester Eijffinger and Donato Masciandaro (VoxEU) Feb 12, 2018
The role of the monetary policy decisions in influencing markets and economies has increased sharply over the past 30 years. A new VoxEU eBook presents the state of the art of the economics and politics of modern monetary policy governance as a story of two tales: on the one side, the tale of how monetary policy decisions are reached; on the other side, the tale of how such decisions can influence the shape of the markets via central banks’ communication policies.

In search of fiscal space: A new database
M. Ayhan Kose, Franziska Ohnsorge and Naotaka Sugawara (VoxEU) Feb 14, 2018
The availability of fiscal space has been at the centre of recent debates on the effective use of fiscal policy. This column introduces a new cross-country database of fiscal space indicators and applies it to the analysis of the evolution of fiscal space over the past quarter century and during oil price plunges. Fiscal space has weakened materially in many emerging and developing economies since the Global Crisis. Fiscal space tends to deteriorate in energy-exporting emerging and developing economies during oil price plunges but later improves, often because of procyclical fiscal tightening.

Putin Isn’t a Genius. He’s Leonid Brezhnev.
Chris Miller (FP) Feb 12, 2018
Russia's economy is stagnating, and Putin isn't doing anything about it.

The Disappointing Recovery in U.S. Output after 2009
John Fernald, Robert E. Hall, James H. Stock, and Mark W. Watson (FRBSF Econ Letter) Feb 12, 2018
U.S. output has expanded only slowly since the recession trough in 2009, counter to normal expectations of a rapid cyclical recovery. Removing cyclical effects reveals that the deep recession was superimposed on a sharply slowing trend in underlying growth. The slowing trend reflects two factors: slow growth of innovation and declining labor force participation. Both of these powerful adverse forces were in place before the recession and, thus, were not the result of the financial crisis or policy changes since 2009.

US inflation of 3% is danger level for emerging market equities
Steve Johnson (FT) Feb 13, 2018
Four out of five EM crashes since the 1990s have coincided with 3% trigger.

A bit of fear is good for markets
Martin Wolf (FT) Feb 13, 2018
The jump in volatility may be disturbing but it should help puncture some of the previous complacency

Brexiters owe us clarity on sovereignty dividend
Janan Ganesh (FT) Feb 13, 2018
Leavers know that voters do not want a much less regulated, much more open economy.

Big Profits Drove a Stock Boom. Did the Economy Pay a Price?
Eduardo Porter (NYT) Feb 13, 2018
Companies free of competitive pressures, with the power to set prices largely at will, pad the bottom line at the expense of customers and workers.

Frontier banks and the school of hard knocks
Brian Caplen (Banker) Feb 13, 2018
G7 bankers complain about QE destroying net interest margins. They should try a spell in a frontier market where sovereign borrowing may be deterring depositors.

The road to ending poverty runs through 31 severely off track countries
Geoffrey Gertz and Homi Kharas (Brookings) Feb 13, 2018
The past 15 years saw the most rapid decline in global poverty ever, but 31 countries still lag behind. How those countries can get back on track and achieve the first U.N. Sustainable Development Goal: End poverty everywhere.

Europe Is Giving Investors More Reason to Cheer
Komal S Sri-Kumar (Bloomberg View) Feb 13, 2018
The bloc is inching toward a unified economic policy.

The End of Free Money for the U.S. Government
Justin Fox (Bloomberg View) Feb 13, 2018
Borrowing is going up; interest rates are going up. It's not great timing.

Bond Bear Markets Aren't Measured in Losses Alone
Ben Carlson (Bloomberg View) Feb 13, 2018
The real risk to investors is the loss of purchasing power over the long term due to inflation.

'More of the Same' Isn't an Option for the Bank of Japan
Daniel Moss (Bloomberg View) Feb 13, 2018
Reports that Haruhiko Kuroda will be reappointed don't mean he can continue stimulus forever.

China Isn't America's Enemy, at Least Not Yet
James G Stavridis (Bloomberg View) Feb 13, 2018
While we play checkers, they play a 200-year game of Go.

The Eurozone Island of Stability
Daniel Gros (Project Syndicate) Feb 13, 2018
After a decade of struggles, the eurozone is an island of relative stability in a turbulent sea. To ensure that it stays that way, its leaders must remember a fundamental truth: no predominantly domestic problem will ever be resolved by a loan or transfer of resources from abroad.

China’s Modernization Ambitions
Yao Yang (Project Syndicate) Feb 13, 2018
Once living standards in China reach a certain level, citizens will almost certainly demand far more personal freedom and political accountability. The most fundamental challenge facing China’s leaders, then, is to find a governance model that fulfills these demands while continuing to exclude electoral democracy.

The Double Threat to Liberal Democracy
Dani Rodrik (Project Syndicate) Feb 13, 2018
Illiberal democracy – or populism – is not the only political menace confronting Western countries. Liberal democracy is also being undermined by a tendency to emphasize “liberal” at the expense of “democracy.”

Cryptocurrencies don't make sense
Jon Danielsson (VoxEU) Feb 13, 2018
Cryptocurrencies are supposedly a new and superior form of money and investments – the way of the future. The author of this column, however, does not see the point of cryptocurrencies, finding them no better than existing fiat money or good investments.

The Trump Administration Is Optimistic About Economic Growth. Be Skeptical.
Neil Irwin (NYT) Feb 14, 2018
For its forecast to come true would require productivity improvements not seen in decades and an atypical policy on interest rates.

The Inflation Surge
WSJ Feb 14, 2018
Republicans should be worried about the impact on real earnings.

What Explains the Dollar’s Doldrums?
Michael Heise (WSJ) Feb 14, 2018
Since December 2016, the euro has risen to $1.23 from $1.05. Under the circumstances one would expect the opposite.

Is the World Trade Organization Dying?
Daniel Gros (Brink) Feb 14, 2018
The WTO can work only if its major members recognize the body's sometimes politically inconvenient judgements. Unfortunately, this is increasingly in doubt. Today, the global trading system is dominated by three large economies none of which is large enough to dominate the system: The EU, the US and China. In the absence of explicit cooperation among them, the present rules-based system may be in danger.

The World Bank’s Misleading Defense of the Doing Business Index
Justin Sandefur (CGD) Feb 14, 2018
Reasonable people can disagree about the usefulness of the World Bank’s country rankings. But after the Chief Economist resigned amidst a controversy about the index, the Bank has made a number of misleading claims, including defending numbers in the press that its researchers have quietly repudiated.

Is it a Transatlantic, Transpacific or Eurasian global economy?
Nicolas Moës (Bruegel) Feb 14, 2018
A look at the data on bilateral trade, services, investment and protectionism between Asia, Europe and the US in recent years gives some indication of the future shape of the world economy.

Don't Be Complacent About Italy's Elections
Bloomberg View Feb 14, 2018
The country's public debt is a threat to global financial stability.

Turmoil Could Help Restore More Normal Markets
Mohamed Aly El-Erian (Bloomberg View) Feb 14, 2018
Investors shouldn't yearn for a return to the comforting calm of 2017.

Run the Economy Extra-Hot
Karl W Smith (Bloomberg View) Feb 14, 2018
Yes, unemployment is low. But it needs to be lower still to heal lingering recessionary scars.

Inflation's Real Threat to the Economy
Danielle DiMartino Booth (Bloomberg View) Feb 14, 2018
The risk is that growth will be thrown off course before wage gains have a chance to take hold.

Europe’s Poverty Time Bomb
Edoardo Campanella (Project Syndicate)/I> Feb 14, 2018
Poverty, especially among the young, has been a growing problem across many European countries since the 2008 financial crisis. And now political leaders in hard-hit countries like Italy are calling attention to the issue in the worst way possible: by promising quick fixes that won't work and would jeopardize government budgets.

Urban concentration and economic growth
Susanne Frick and Andrés Rodríguez-Pose (VoxEU) Feb 14, 2018
Urban concentration is typically deemed to lead to greater national economic growth. This column challenges this view, using an original dataset covering 68 countries over the past three decades.

China’s Rise, Changing Stripes, and Global Implications of a Potential Slowdown
Shaghil Ahmed (VoxChina) Feb 14, 2018
China’s remarkable economic rise over the past three decades has yielded many benefits to its own citizens and to people all around the globe. But the export-led growth model that underpinned China’s success and its increased role in the global economy has also led over time to the development of some serious imbalances in its economy. How China deals with these imbalances will have important implications for the rest of the world going forward—in particular, the quantitative analysis reported here suggests that were China to experience a financial crisis, the hit to the rest of the world would be substantial.

China’s AI Agenda Advances
Elsa Kania (Diplomat) Feb 14, 2018
As China throws state support behind AI development, major Chinese technology companies will remain integral players.

All Tortoise, No Hare: Japan's Economic Growth Continues
Tim Quinlan and Shannon Seery (WF) Feb 14, 2018
Japan extended its longest stretch of uninterrupted growth since 1986 in the fourth quarter. Although the pace of growth slowed, the economy was up 1.6 percent for the whole of 2017.

Zuma Has Fallen
Sisonke Msimang (FP) Feb 14, 2018
Jacob Zuma weathered scandal after scandal while driving South Africa’s economy and reputation into the ground. His luck has finally run out.

How to read the regime change at the US Fed
Gillian Tett (FT) Feb 15, 2018
It would be a mistake to presume the bank will ride to the rescue if equities tumble.

Eurozone must be serious about risk-sharing
Marcello Minenna (FT) Feb 15, 2018
This is the only way to address the imbalances inside the single currency.

EM bond buying ‘sows the seeds for future crises’
Steve Johnson (FT) Feb 15, 2018
Voracious appetite for fixed income ‘increases risk of debt binges’.

The European Union’s Democracy Deficit
Joseph C. Sternberg (WSJ) Feb 15, 2018
To make the bureaucracy more accountable, leaders in Brussels consider a plan for a quasi-president.

How does Chinese tech stack up against American tech?
Economist Feb 15, 2018
Silicon Valley may not hold onto its global superiority for much longer.

Trudeau, Freeland Make Case for NAFTA As Trade Negotiators Prepare for Next Round
Bridges, Volume 22, Number 5 Feb 15, 2018
Canadian Prime Minister Justin Trudeau concluded a trip to the US this past weekend to discuss trade and other areas of cooperation with state and local leaders, touting the potential for an updated North American Free Trade Agreement (NAFTA) while cautioning that the final deal would still need to go far enough to serve Canadian interests.

EU, UK Debate Transition Period Terms as Brexit Negotiations Continue
Bridges, Volume 22, Number 5 Feb 15, 2018
The latest formal round of Brexit negotiations drew to a close last Friday, covering issues related to the Irish border, the governance of the withdrawal agreement, and the transition period after the UK leaves the European Union. The meetings in Brussels also saw officials afterward note significant substantive differences across these areas, with some concerns over what this could mean for the timing of the process.

EU Officials: US Participation in Paris Climate Deal Key for Resuming Trade Talks
Bridges, Volume 22, Number 5 Feb 15, 2018
Officials from some EU member states and the bloc’s executive branch have affirmed in recent weeks that the US’ continued participation in the UN’s Paris Agreement on climate change is essential if the two sides are to resume formal trade talks in the future.

Japan Keeps the Right Person to Run Its Central Bank
Noah Smith (Bloomberg View) Feb 15, 2018
Abenomics required an end to timid monetary policy. Haruhiko Kuroda is providing it.

As China Rises, Fed Is U.S.'s Bulwark in Asia
Daniel Moss (Bloomberg View) Feb 15, 2018
Asians still care more about the dollar than about Donald Trump.

Chinese Need to Learn to Save Again
Andrew Polk (Bloomberg View) Feb 15, 2018
After decades of thrift, they're taking on too much personal debt.

Three Keys to a New South Africa
Fred Phaswana (Project Syndicate) Feb 15, 2018
After nearly a decade of Jacob Zuma's misrule, South Africans are eager for a leader who can reverse their country's political and economic fortunes. ANC President Cyril Ramaphosa may have the mandate to do so, but delivering change will require urgent measures to boost economic growth in the short term and long-term potential output.

Macroprudential stress tests
Ron Anderson, Chikako Baba, Jon Danielsson, Heedon Kang, Udaibir Das and Miguel Segoviano (VoxEU) Feb 15, 2018
Current stress testing of banks is focused on the resiliency of individual banks to exogenous shocks. This column describes how the next generation of macroprudential stress tests aim to capture the endogenous nature of systemic risk caused by the interaction of all the institutions and markets making up the financial system. This will lead to a better policy mix aimed at preserving financial stability.

European Banking Needs Its Own Ryanair
Boris Liedtke (EFR) Feb 15, 2018
With the unprecedented technological developments and innovations, the soundness of the banking system is also affected as new regulations are put in place. In this article, the author elaborates on how the model of Ryanair banking can make banks truly stable and adaptive to the new low-cost service providers, which retail customers demand.

EM inflation threatens local currency debt investors
Jonathan Wheatley (FT) Feb 16, 2018
Dollar weakness is no longer the given it has been for the past 18 months.

China’s WTO entry has been a boon, not an error
Andy Rothman (FT) Feb 16, 2018
The US economy has enjoyed significant benefits from its inclusion.

The Vix horror show will not deter future suckers
John Dizard (FT) Feb 16, 2018
Investors looking for safer products should look to the municipal bond market.

Higher bond yields fail to arrest weakening dollar
John Authers (FT) Feb 16, 2018
Strong run for gold hints at worries over inflation that also hamper the US currency.

Two cheers for the return of volatility
John Authers (FT) Feb 16, 2018
An end to a period of unusual calm is welcome, but problems lie in wait for investors.

How to end South Africa’s economic crisis
Michael Power (FT) Feb 16, 2018
To meet the challenge, the new president must take a leaf out of China’s book.

Europe needs to step up vigilance on China’s influence
Thorsten Benner and Kristin Shi-Kupfer (FT) Feb 16, 2018
Beijing’s authoritarian brand presents a direct challenge to liberal traditions.

China’s role in market volatility
Paul Hodges, Daniël de Blocq van Scheltinga and Paul Satchell (FT) Feb 17, 2018
Beijing’s shifting priorities raise questions over assumptions of global growth.

Why Economists Are Worried About International Trade
Gregory Mankiw (NYT) Feb 16, 2018
ost agree that the net impact of free trade is beneficial. Yet the Trump administration's imposition of tariffs suggests that this truth isn't obvious to everyone.
Immediately following the US presidential election in November 2016, many economists were concerned that increased uncertainty over economic policy would lead to a decline in the US stock market. From the time of the election to the end of 2017, however, the stock market, as measured by the Standard and Poor's (S&P) 500 index, increased by about 25 percent. Price swings since then have led investors and economists to increasingly ask: Was the stock market rise justified by an increase in actual and expected future dividends, or did it reflect unhealthy price developments, which may reverse in the future?

How IT Threatens Democracy
Kofi A. Annan (Project Syndicate) Feb 16, 2018
Social media could be just the start of a slippery slope leading to an Orwellian world controlled by Big Data Brother, accelerated by convergence with the sensors in our devices and rapid advances in artificial intelligence. Some authoritarian regimes are already marshaling these developments to exercise control on an unprecedented scale.

The Data-Driven City
Ana Lucía Moya (Project Syndicate) Feb 16, 2018
One of the most significant innovations in urban planning is the embrace of "open data": user-generated information that can provide valuable insights into how people use cities. If shared and analyzed properly, these nuggets of digital detail can be a real-time blueprint for solving cities' most pressing challenges.

Average income per capita, health outcomes, and the allocation of development assistance for health
Olivier Sterck, Max Roser, Mthuli Ncube and Stefan Thewissen (VoxEU) Feb 16, 2018
Large multilateral organisations like WHO and the UN rely heavily on average income data in determining eligibility for, and the allocation of, development assistance for health. This column tests this paradigm by analysing the determinants of health outcomes for 99 countries. A country’s epidemiological surroundings, poverty gap, and institutional capacity appear to be much better predictors of health outcomes than gross national income. These findings suggest alternative metrics that could be leveraged in allocating development assistance for health.

Olivier Blanchard, Christopher G. Collins, Mohammad R. Jahan-Parvar, Thomas Pellet and Beth Anne Wilson (PIIE) Feb 16, 2018

Sadly, Brexit must mean leaving the single market
Malcolm Rifkind (FT) Feb 18, 2018
I have concluded this is essential for fundamental democratic reasons.

Eurozone reformers act as if the crisis never happened
Wolfgang Münchau (FT) Feb 18, 2018
Safe bonds are a bad idea whose time has definitely not come.

Today, inflation. Tomorrow, crisis?
Robert J. Samuelson (WP) Feb 18, 2018
New Fed chair Jerome Powell has his work cut out for him.

Trump’s fiscal gamble and the US twin deficits
Gavyn Davies (FT) Feb 19, 2018

Productivity surprise could set agenda for markets
Karen Ward (FT) Feb 19, 2018
Investors are on inflation alert but an increase in output could be powerful.
A large fiscal boost so late in the US cycle will add to pressure on the Fed.

Brexit Britain sees Europe through a distorting lens
Gideon Rachman (FT) Feb 19, 2018
The Leave and Remain camps are divided and incapable of dispassionate analysis.

Start preparing for the next financial crisis now
William White (FT) Feb 19, 2018
We need measures to limit the likelihood of disorderly market processes in the next downturn.

Venezuela’s hyperinflation
Silvia Merler (Bruegel) Feb 19, 2018
The International Monetary Fund forecasts Venezuelan inflation spiralling to 13,000 percent this year. As President Maduro is expected to introduce the “petro” cryptocurrency next week, we review economists’ recent (and less recent) opinions on the current crisis.

Here’s Who Really Matters at the Bank of Japan
Daniel Moss (Bloomberg View) Feb 19, 2018
Masayoshi Amamiya could provide the central bank with much-needed room to maneuver.

Europe Can't Get Its Stories Straight
Leonid Bershidsky (Bloomberg View) Feb 19, 2018
A look back at news coverage of the euro crisis shows how the top economies don't share a reality.

Keep Looking for the Brexit Effect on U.K. Banking
Mark Whitehouse (Bloomberg View) Feb 19, 2018
The country has grown as a base for global lending since the 2016 referendum.

The Irresponsible ECB
Jürgen Stark (Project Syndicate) Feb 19, 2018
Ultra-loose monetary policy stopped being appropriate long ago, and is especially inadvisable now, with the global economy – especially the developed world – experiencing an increasingly strong recovery. As recent stock-market turbulence shows, refusal to normalize policy faster is drastically increasing the risks to financial stability.

Growth-equity trade-offs in structural reforms
Jonathan D. Ostry, Andrew Berg and Siddharth Kothari (VoxEU) Feb 19, 2018
While there is consensus that structural reforms can increase growth, there is also a fear that certain reforms can exacerbate inequality. This column argues – based on a dataset covering financial, institutional, and real sector reforms – that certain reforms do indeed increase inequality but despite this, the net effect on growth remains positive.

Two ways to read Mrs Watanabe’s splurge on Japanese stocks
Leo Lewis (FT) Feb 20, 2018
The biggest weekly buying of Japanese equities since 1987 offers conflicting historical signals.

Rebuild internet governance before it is too late
Vint Cerf (FT) Feb 20, 2018
Managing the way separate frameworks apply to the internet remains a big challenge.

US economy: The growth puzzle
Sam Fleming (FT) Feb 20, 2018
After several years of weak demand and low inflation, investment is rising. But an increase in long-term growth requires a big jump in productivity.

Modi’s tariff rise will hurt the Indian economy
Mary Lovely (FT) Feb 20, 2018
The country’s answer to a perceived Chinese threat risks detaching it from supply chains.

South Korea’s Most Dangerous Enemy: Demographics
Brook Larmer (NYT) Feb 20, 2018
The countries of East Asia may need to overcome their ethno-nationalistic resistance to immigration if they want to remain economic powerhouses.

Why are foreign banks fleeing Vietnam?
Pham Chi Dung (AT) Feb 20, 2018
Answer: poor risk management, impending bank bankruptcies and rising political risks.

Why Asia ought to shift gear and welcome rising currencies
William Pesek (AT) Feb 20, 2018
Mercantilism helped propel Asian economies to today’s heights, but it’s no longer clear that their weak-currency doctrine is still viable

Positive Signs in European Labor Markets in 10 Charts
Jacob Funk Kirkegaard (PIIE) Feb 20, 2018
The European Commission estimates the euro area economy grew at 2.5 percent in 2017, an upward revision of its previous estimates, suggesting that the pattern will continue in 2018.

Portugal in a new context of capital flows
Inês Goncalves Raposo (Publico/Bruegel) Feb 20, 2018
The euro area is now the world’s largest exporter of capital. Here we look at the post-crisis transition of one euro-area country – Portugal – from net recipient to net provider of capital, in the context of the European Commission’s plans for deeper capital markets.

What’s Next for Investors in the Bond Market
Tony Crescenzi (PIMCO) Feb 20, 2018
Recent market volatility suggests that investors are questioning whether the post-crisis subpar pace of economic growth, which we dubbed The New Normal, is subsiding.

International Cooperation 2.0
Ngaire Woods (Project Syndicate) Feb 20, 2018
As faith in US leadership declines, so may other countries’ commitment to international cooperation – trends that could culminate in an economic race to the bottom or even violent conflict. But another way already seems to be emerging, based on new coalitions, as well as updated global institutions, spearheaded by more diverse actors.

Job and Cultural Insecurity, More Than Inequality, Fuels Populism
Pranab Bardhan (YaleGlobal) Feb 20, 2018
Populist leaders convince working-class voters that job security and loss of culture are more treacherous than inequality

On the link between US pay and productivity
Anna Stansbury and Lawrence Summers (VoxEU) Feb 20, 2018
Since 1973, there has been divergence between labour productivity and the typical worker’s pay in the US as productivity has continued to grow strongly and growth in average compensation has slowed substantially. This column explores the causes and implications of this trend. Productivity growth appears to have continued to push workers’ wages up, with other factors to blame for the divergence. The evidence casts doubt on the idea that rapid technological progress is the primary driver here, suggesting rather that institutional and structural factors are to blame.

Absolute poverty: when necessity displaces desire
Robert Allen (MI) Feb 20, 2018
How many poor people are there in the world? Where are they located? Are economic development and globalisation increasing or decreasing their number? If so, which countries have been most affected? To answer these questions, we need a metric to measure poverty.

Rising Household Leverage: Should We Be Worried?
Jay H. Bryson and Abigail Kinnaman (WF) Feb 20, 2018
Some advanced economies have experienced increases in household leverage and household debt servicing ratios in recent years. With many central banks beginning the process of normalizing their respective policy stances do these economies face a risk of stalling if debt servicing among households shoots higher? Could growth in the global economy be threatened again? Our analysis suggests that any such concerns are probably premature.

Italian risks to the eurozone
Desmond Lachman and Ryan Nabil (AEI) Feb 20, 2018
Italy's forthcoming parliamentary elections must produce a government committed to solving the country's crippling economic problems via far-reaching reforms. Judging by Italy's poor economic performance since 2000, it would seem that adopting the euro as its currency in 1999 was a big mistake. However, leaving the euro at this stage would not seem to be a viable alternative for the country. Most economists would agree that Italy needs faster economic growth if it is to resolve its public debt and banking-sector problems in an orderly manner. With an appreciable risk that Italy could crash out of the euro, hopefully the elections produce a united government committed to serious economic reform.

Happily there’s more to Japan Inc than the Bank of Japan
Henny Sender (FT) Feb 21, 2018
BoJ governor’s reappointment offers continuity but investors should look beyond that.

Gulf between the two camps of eurozone reformists
Tony Barber (FT) Feb 21, 2018
The German-led group remains opposed to the France and Italy contingent on sovereign debt.

The latest pro-Brexit analysis has got its sums badly wrong
Chris Giles (FT) Feb 21, 2018
Assumptions used for the Economists for Free Trade paper are absurd.

The silver lining for bond traders
Michael Mackenzie (FT) Feb 21, 2018
A US bond market escaping the influence of central bank buying will offer trading opportunities.

What most threatens the economy? You might be surprised.
Robert J. Samuelson (WP) Feb 21, 2018
The annual report of the White House Council of Economic Advisers gives us a warning.

Emerging Markets: Standing Up to Higher Volatility
Yacov Arnopolin, Pramol Dhawan and Gene Frieda (PIMCO) Feb 21, 2018
During the second most significant repricing in U.S. Treasury bond yields since 2013, emerging market debt has so far significantly outperformed equity, oil and U.S. Treasury beta.

Can Robots Save Banks? RegTech’s Potential to Solve De-Risking
Vijaya Ramachandran and Jim Woodsome (CGD) Feb 21, 2018
Policies put in place to counter financial crimes have unfortunately had a chilling effect on banks’ willingness to do business in markets perceived to be risky—due in part to the high price of compliance. Even as changes are being made to address this problem, financial institutions are developing solutions in the form of new cutting-edge technologies to help them comply better and faster with anti-money laundering regulations.

The Economy Is Getting Hotter. Is a Productivity Boom Next?
Neil Irwan (NYT) Feb 21, 2018
New research suggests that for the economy to become more productive, demand matters.

Can’t Wait a Month for Inflation Data? Daily Gauge Shows Prices in Real Time
Eric Morath (WSJ) Feb 21, 2018
PriceStats, based on MIT's Billion Prices Project, takes a daily temperature using online sales.

Why America Is Going Broke
John F. Cogan (WSJ) Feb 21, 2018
Entitlements are driving deficits and debt. Absent reform, the problem will soon become a crisis.

The Euro Zone Needs More Risk Sharing, But Fewer Risks
Ferdinando Giugliano (Bloomberg View) Feb 21, 2018
France and Germany are making a good start, but it will be hard to build a consensus.

A Strong U.S. Economy Can Be Tough on Immigrants
Conor Sen (Bloomberg View) Feb 21, 2018
Wage growth and real-estate development could ravage working-class communities.

Connect to Trade
Haoyuan Ding, Haichao Fan and Shu Lin (VoxChina) Feb 21, 2018
A key foundation of Chinese-style institutions is that different levels of government control resources and utilize their power to support businesses connected to them. Professors Haoyuan Ding of Shanghai University of Finance and Economics, Haichao Fan of Fudan University, and Shu Lin of the Chinese University of Hong Kong develop a theoretical model and present supporting empirical evidence to show how this institutional feature affects firm exports in China. In particular, they find that political connection has a positive effect on export in industries that heavily rely on external finance and contracting environment, but a negative effect on export in other industries.

Bank bail-ins: Lessons from the Cypriot crisis
Panicos Demetriades (VoxEU) Feb 21, 2018
Europe’s new framework for resolving banks includes a ‘bail-in’ mechanism which aims to ensure that banks’ shareholders and creditors pay their share of costs, and which was first used to resolve the 2013 banking crisis in Cyprus. This column, written by the economist who was the country’s central bank governor at the time, examines the unintended consequences of the bail-in, which have proved more toxic than could ever have been imagined, and not just in Cyprus. Several euro area central banks and their governors have found themselves in the eye of political and legal storms when taking actions to resolve failing banks and/or restore stability in their banking systems.

How to stop Brexit
Simon Kuper (FT) Feb 22, 2018
Flawed though the referendum was, everyone agreed its rules in advance. Yet Stoppers finally feel they can win.

Volatility upsurge puts real interest rates in focus
Michael Mackenzie (FT) Feb 22, 2018
Ten-year yields adjusted for inflation have not broken out of long-term range.

The renewed strength of south-east Asia in 7 charts
FTCR Feb 22, 2018
Global equities sell-off poses little immediate risk to underlying Asean-5 economies.

Trump and Canada May Chill a Nafta Deal
F.H. Buckley (WSJ) Feb 22, 2018
Trudeau’s politically correct demands only heighten antagonism with the president.

Grantham gushes about emerging markets – what’s he onto?
William Pesek (AT) Feb 22, 2018
Veteran investor has been right on vital calls before; there's plenty of reason to think he has a good read on developing Asia

OPEC mulls a long-term alliance with Russia to keep oil prices stable
Economist Feb 22, 2018
One aim is to allay fears that a current pact will unravel.

Canada, Mercosur Eyeing Possible Trade Negotiations Launch Next Month
Bridges, Volume 22, Number 6 Feb 22, 2018
Canada and the South American trading bloc Mercosur are reportedly expected to announce the formal launch of trade talks next month, during a meeting on 9 March between Canadian trade minister François-Philippe Champagne and his Mercosur counterparts in Asunción, Paraguay.

Canadian, Indian Leaders Look to Reinvigorate Economic Ties
Bridges, Volume 22, Number 6 Feb 22, 2018
Canadian Prime Minister Justin Trudeau is in India this week for a series of talks with domestic leaders and business officials, including a highly anticipated meeting on Friday 23 February with Indian Prime Minister Narendra Modi that is slated to focus on trade, investment, and other shared priorities.

CPTPP Partners Gear Up for Signing Ceremony, Ratification Process
Bridges, Volume 22, Number 6 Feb 22, 2018
Countries in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) are preparing to gather in Santiago, Chile, in two weeks to sign the updated trade accord, whose text was released publicly on Wednesday 21 February.

Officials, Steel Industry Groups React to US Agency’s Tariff Recommendations
Bridges, Volume 22, Number 6 Feb 22, 2018
The prospect of US tariffs on imported steel and aluminium has drawn scrutiny and concern from industry groups and government officials from various trading partners, as well as from some domestic lawmakers, following the release of reports from the US Commerce Department on 16 February that recommended the move.

A Latvian Test for the European Central Bank
Bloomberg View Feb 22, 2018
The ECB should acknowledge what's at stake in dealing with the scandal.

Inflation Is a Bigger Danger to Stocks Than Rising Rates
Ben Carlson (Bloomberg View) Feb 22, 2018
Rising prices have a stronger relationship with poor market outcomes.

Financing intangible capital
Stephen Cecchetti and Kim Schoenholtz (VoxEU) Feb 22, 2018
Investment is shifting from tangible physical assets to intangible goods like software, data, and R&D. This column analyses the impact of this shift on the structure of firm financing. The financial system’s shift from public to private equity is, on the whole, an encouraging reflection of its response to the changing needs of the economy.

IMF’s Bitter Medicine Brought Growth, But Also Inequality
Steven Borowiec (YaleGlobal) Feb 22, 2018
Many South Koreans blame the IMF for economic woes, but President Moon relies on the IMF formula for reducing inequality

The U.S. economy after the global financial crisis
Randal K. Quarles (FRB) Feb 22, 2018
The U.S. economy appears to be performing very well and, certainly, is in the best shape that it has been in since the crisis and, by many metrics, since well before the crisis.

A world of debt mortgages our economic future
Derek Scissors (FT) Feb 23, 2018
Irresponsible borrowing by the US, China and India imperils global growth.

Yen strength talk changes if dollar frailty systemic
Leo Lewis (FT) Feb 23, 2018
World’s largest net creditor nation means currency faces upward pressure for years.

Modi Should Practice What He Preaches on Trade
Bloomberg View Feb 23, 2018
The last thing India needs is a lurch toward protectionism.

No, the Fed Isn't Behind the Curve on Stagflation
Neil Dutta (Bloomberg View) Feb 23, 2018
The low risk of inflation should curb the recent increase in Treasury yields and provide relief to equity investors.

What Campbell’s Soup Tells Us About the Economy
Conor Sen (Bloomberg View) Feb 23, 2018
Inequality is likely to shrink along with profit margins.

Inflation Worrywarts Just Need to Calm Down
Daniel Moss (Bloomberg View) Feb 23, 2018
The Fed isn't rattled by a little rise in jobs and wages. That's what it's been seeking for years.

Education in the Digital Age
Koichi Hamada (Project Syndicate) Feb 23, 2018
While no human will be able to compete with intelligent machines when it comes to reciting facts or performing formulaic calculations, human ingenuity and creativity remain unmatched. We should make the most of that fact, and give young people the opportunity to use their advantages as effectively as possible.

The Alibaba effect: Spatial inequality and the welfare gains from e-commerce
Jingting Fan, Lixin Tang, Weiming Zhu and Ben Zou (VoxDev) Feb 23, 2018
E-commerce disproportionately benefits consumers in small and remote places, helping to reduce disparities in living standards across locations.

Foreign exchange interventions: Frequent and effective
Marcel Fratzscher, Lukas Menkhoff, Lucio Sarno and Tobias Stöhr (VoxEU) Feb 23, 2018
Central bank interventions in foreign exchange markets have long been viewed with scepticism by academics. This column examines foreign exchange interventions for a sample of 33 advanced and developing economies. Interventions occur frequently, in episodes that can last several days, and are often successful in smoothing exchange rates. These results show that central bankers, particularly in emerging markets, appreciate the efficacy of interventions.

The World Bank’s Doing Business Indicators Still Work
Daniel Runde (FP) Feb 23, 2018
The World Bank’s "Doing Business" indicators are among the institution's most powerful tools — heed not the critics.

Latvia: a banking scandal on the Baltic
Neil Buckley (FT) Feb 24, 2018
The eurozone member state has been hit hard by bribery and money laundering allegations that have raised questions about overseas money.

Try timing the market but accept your limitations
John Authers (FT) Feb 24, 2018
There are limits on an ability to judge future probabilities and never pay too much.

The Fed Should Aim Higher Than 2% Inflation
Steven Englander (Bloomberg View) Feb 24, 2018
How policy makers interpret the target is more important than whether they raise rates three or four times this year.

Money and monetary stability in Europe, 1300-1914
K. Kivanc Karaman, Sevket Pamuk and Secil Yildirim-Karaman (VoxEU) Feb 24, 2018
There is a notable lack of long-run analyses of monetary systems and their stability. This column addresses this gap by looking at the monetary systems of major European states between 1300 and 1914. The evidence collected suggests that, despite many switches between standards and systems, fiscal capacity and political regimes ultimately shaped patterns of monetary stability. Theories of monetary stability that rely on the mechanics of monetary systems perform poorly when such a long-run perspective is taken.

Trump’s plan to keep ‘competitor’ China at bay
Shawn Donnan (FT) Feb 25, 2018
The US wants more scrutiny of deals with Chinese companies but critics fear the system will hurt innovation.

Three questions for the Fed chairman Powell
Rana Foroohar (FT) Feb 25, 2018
The Senate should ask about wage compression, power concentration and share buybacks.

The US risks making a strategic blunder over China
Zhou Bo (FT) Feb 25, 2018
Washington mistakenly views its relationship with Beijing as a power struggle.

Weaving the UK’s Brexit strategy into three baskets
Nick Clegg (FT) Feb 25, 2018
Prime minister Theresa May will reveal the blueprint in a speech next week.

The political consequences of slower economic growth
Robert J. Samuelson (WP) Feb 25, 2018
Expect intensifying competition among Americans for ever-larger shares of the nation’s slow-growing income.

Achieving balance in Australia’s strategic thinking
Gordon de Brouwer (EAF) Feb 25, 2018
There is no binary choice between security and economic interests for countries trying to manage the uncertainties of the post-American economic order.

More openness could have swung the regional Brexit vote
Harry Garretsen, Janka I. Stoker, Dimitrios Soudis, Ron Martin and Jason Rentfrow (VoxEU) Feb 25, 2018
The outcome of the UK’s referendum on EU membership came as a shock to most academic and policy experts. This column uses an extensive dataset of personality traits combined with socioeconomic data to show how the clustering of personality traits contributes to an understanding of the regional dispersion of the Brexit vote. Openness appears to be the trait that matters most – modest changes in this openness could actually have swung the vote across UK districts.

A customs union would avoid the worst of all post-Brexit worlds
Wolfgang Münchau (FT) Feb 26, 2018
The EU is likely to approve such a deal, but it would also impose stringent controls.

Narendra Modi’s jobs claim proves a political hot pakora
Amy Kazmin (FT) Feb 26, 2018
Indian PM’s comments about self-employment have been widely mocked by his rivals.

Europe’s Tax Reform Losers
WSJ Feb 26, 2018
The Continent scrambles to respond to a more competitive America.

Don’t Misjudge Trump’s Trade Tirade
Walter Russell Mead (WSJ) Feb 26, 2018
The president may be shifting the discussion more than GOP elites think is possible.

President Xi turns to old friends to manage economy
Gordon Watts (AT) Feb 26, 2018
Economic guru Liu and former ‘enforcer’ Wang look certain to play leading roles in dealing with China’s economic and financial risks

Rising Interest Rates Would Explode the Federal Debt
Veronique de Rugy and Justin Leventhal (Mercatus) Feb 26, 2018
A new chart series uses CBO estimates to demonstrate how the federal budget and debt would be affected by various future Treasury bond interest rates.

Political Risk 2018: Tensions and Turbulence Ahead
Angela Duca (Brink) Feb 26, 2018
The political risk environment for multinational organizations is complex and ever-changing. Social instability, adverse government actions, and terrorist threats are among the most common—but by no means the only—political risks that multinational organizations will face in 2018 when trading or investing outside their home borders.

Debating the Outlook for U.S. Workers
Conor Sen and Karl W Smith (Bloomberg View) Feb 26, 2018
Is the economy running hot enough to generate pay raises? Conor Sen and Karl W. Smith discuss.

The Myth of Sound Fundamentals
Stephen S. Roach (Project Syndicate) Feb 26, 2018
The recent correction in the US stock market is now being characterized as a fleeting aberration – a volatility shock – in what is still deemed to be a very accommodating investment climate. In fact, for a US economy that has a razor-thin cushion of saving, dependence on rising asset prices has never been more obvious.

China Confronts the Mundell-Fleming Trilemma
Yu Yongding (Project Syndicate) Feb 26, 2018
For the last year or so, the People's Bank of China has stopped intervening daily in the foreign-exchange market. Whatever challenges it faces, the PBOC must stay the course, and convince markets that China really is committed to a floating exchange-rate regime.

How Europe’s Band-Aid Ensures Greece’s Bondage
Yanis Varoufakis (Project Syndicate) Feb 26, 2018
All the happy talk about impending “debt relief” and a “clean exit” from Greece’s third “bailout” obscures an uglier truth: the country’s debt bondage is being extended to 2060. Worse, by ossifying Greece’s insolvency, while pretending to have overcome it, Europe’s establishment is demonstrating its refusal to fix the eurozone’s flaws.

Closing the Global Economy’s New Digital Divide
Shamel Azmeh (Project Syndicate) Feb 26, 2018
As the global economy is transformed by new technologies, developing countries are at risk of losing out. While overcoming the resource constraints that limit developing countries’ investment in the digital economy will not be easy, failing to do so will carry a steeper price.

Demand for agricultural commodities to grow more slowly in the next decade
Koen Deconinck, Hubertus Gay and Holger Matthey (VoxEU) Feb 26, 2018
As the world’s population becomes more numerous, more prosperous, and more urbanised, it is often assumed that growth in global demand for food will accelerate. This column argues, however, that for most agricultural commodities a slowdown in demand growth over the next ten years is more likely, allowing policymakers to focus on the parallel requirements of using the earth’s natural resources sustainably and making an effective contribution to climate change mitigation.

Senator Raises Alarm Bells on Diversity at U.S. Foreign Aid Agency
Robbie Gramer (FP) Feb 26, 2018

China's Stability Myth Is Dead
James Palmer (FP) Feb 26, 2018
With Xi Jinping's great power comes great irresponsibility.
The new leadership at the Millennium Challenge Corporation is coming under scrutiny after “disturbing” comments by a senior official.

Globalization Has Created a Chinese Monster
Emile Simpson (FP) Feb 26, 2018
Xi Jinping's dictatorship isn't what the end of history was supposed to look like.

Monetary Policy Cycles and Financial Stability
Pascal Paul (FRBSF Econ Letter) Feb 26, 2018
Recent research suggests that sustained accommodative monetary policy has the potential to increase financial instability. However, under some circumstances tighter monetary policy may increase financial fragility through two channels. First, a surprise tightening tends to reduce the market value of banks’ equity and raise their market leverage, exacerbating balance sheet fragility in the short run. Second, increases in the federal funds rate have historically been followed by an expansion of assets held by money market funds, which proved to be a source of instability in the 2007-09 financial crisis

Is Corporate Debt a Global Systemic Problem?
Jay H. Bryson (WF) Feb 26, 2018
Businesses in many economies have become increasingly leveraged since the financial crisis. The bottom line is that we are not overly concerned about corporate debt short circuiting the global economic expansion, at least not in the foreseeable future.

What happens if there is no Brexit withdrawal agreement
David Allen Green (FT) Feb 27, 2018
Failure in this area would mean the UK facing yet more difficult decisions.

Sixty years of investing, with plenty of ups and downs
John Lee (FT) Feb 27, 2018
2018 looks very uncertain, I’ll be happy to maintain my 2017 values.

Fox and Johnson show Brexiters are losing sway
Sebastian Payne (FT) Feb 27, 2018
Those in favour of leaving the EU are failing to address the UK’s serious situation.

China is now vulnerable to the whims of one man
Martin Wolf (FT) Feb 27, 2018
Autocracy is a risky system, even in a country with a solid bureaucratic tradition.

Xi’s bid to stay in power more of a gamble than it seems
Tom Mitchell (FT) Feb 27, 2018
President’s move risks backlash from China’s urban elites if not the masses.

Italian election: voters frustrated with shallow recovery
James Politi (FT) Feb 27, 2018
Ahead of Sunday’s election many people are still waiting for the promised improvements from economic reform.

As Goldman frets bond yields, Japan bears watching
William Pesek (AT) Feb 27, 2018
Japan's officials risk losing control of a market that harbors the most obvious, and least acknowledged, asset bubble.

ASEAN and the IMF: Working Together to Foster Inclusive Growth
Christine Lagarde (IMF) Feb 27, 2018
Today our discussions will focus on how we can create new growth models that are both sustainable and inclusive. That is our common responsibility.

Sub-Saharan Africa Can Multiply Its Success Stories and Donors Can Help
Ngozi Okonjo-Iweala, Brian Pinto and Nancy Birdsall (CGD) Feb 27, 2018
Many of the world’s poorest countries in sub-Saharan Africa have shown they can reform and improve governance. But the momentum is fizzling out. In a new round of tough reforms, African leaders will need to do the heavy lifting. Africa is still poor, and not yet able to finance the investments critical to a new round of growth and poverty reduction. Here’s what donors could do.

Tapping Yield at the Front End of the Curve
Jerome M. Schneider and Andrew T. Wittkop (PIMCO) Feb 27, 2018
It may be time for investors to actively reevaluate their liquidity management.

The Next Correction?
Jamil Baz and Steve Sapra (PIMCO) Feb 27, 2018
A rise in real yields could lead to a dramatic equity sell-off.

India's Biggest State Is Its Biggest Mess
Mihir Sharma (Bloomberg View) Feb 27, 2018
For the country to fulfill its potential, it has to fix Uttar Pradesh.

The EU Can Do a Lot More With Its Money
Ferdinando Giugliano (Bloomberg View) Feb 27, 2018
A document by Italy and Germany puts a welcome new emphasis on "public goods."

Marxism Has Cornered the Junk-Bond Market
Jim Bianco (Bloomberg View) Feb 27, 2018
Passive investing doesn't discriminate between individual winners and losers.

China's Bailouts Won't End With Anbang
Christopher Balding (Bloomberg View) Feb 27, 2018
Stability remains Beijing's primary concern.

Trump’s Economic Gamble Might Actually Make Sense
Conor Sen (Bloomberg View) Feb 27, 2018
He’s betting that deficits can spur productivity.

China Now Faces the Downsides of Dictatorship
Noah Feldman (Bloomberg View) Feb 27, 2018
The period of term-limited presidents corresponded with unprecedented growth. Now Xi Jinping is changing the rules.

The Making of Lehman Brothers II
Simon Johnson (Project Syndicate) Feb 27, 2018
A serious legislative effort, supported by the Trump administration, is underway to reduce the level of scrutiny applied to banks that are on the verge of becoming systemically important. If congressional Republicans have their way, financial stability will be at greater risk than at any time since the 2008 crisis.

The Market Dogs That Didn’t Bark
Anatole Kaletsky (Project Syndicate) Feb 27, 2018
Did February’s equity-price reversal mark the end of the bull market, or was it just a temporary correction? In addressing this question, one must look not just at the stock market, but also at oil prices, long-term US interest rates, and currencies.

Why There Is No “Beijing Consensus”
Andrew Sheng and Xiao Geng (Project Syndicate) Feb 27, 2018
China observers can’t seem to agree on the underlying logic of the country's development model. But, with faith in the West's long-dominant Washington Consensus breaking down, both sides may be in a similar position – a reality that could facilitate cooperation to deliver global public goods.

Why Are US Interest Rates High and Rising?
Martin Feldstein (Project Syndicate) Feb 27, 2018
New savers in the United States stand to gain as returns on savings – which have been subject to severe financial repression for most of the last decade – begin to rise. But higher interest rates could leave homeowners and shareholders vulnerable to losses.

Working Toward the Next Economic Paradigm
Mohamed A. El-Erian (Project Syndicate) Feb 27, 2018
Building support for a new unifying economic paradigm to replace the discredited Washington Consensus will be an analytically challenging, politically demanding, and time-consuming process. In the meantime, both economists and policymakers must ensure that the existing paradigm doesn't cause more damage than it already has.

Italy’s Election Is a Shipwreck
Luigi Zingales (FP) Feb 27, 2018
Italians are rearranging the deck chairs as their country irrevocably sinks.

Huge fraud at Indian bank spurs privatisation calls
Amy Kazmin (FT) Feb 28, 2018
Critics say scam highlights rot in state lenders and need for change.

Powell takes focus off pressure in money market
Michael Mackenzie (FT) Feb 28, 2018
A combination of factors are pushing up short-term interest rates.

Modern finance must kick its addiction to indices
Miles Johnson (FT) Feb 28, 2018
Drawing conclusions about today’s market based on a study of past indices is misguided.

New Fed chair jolts markets with business-like tone
John Authers (FT) Feb 28, 2018
Powell breaks with recent pattern of central bank chiefs coming from academia.

China’s political changes may sow seeds of slowdown
FTCR Feb 28, 2018
Latest FTCR data show growth remains robust, but political calculus is changing.

We got China wrong. Now what?
Charles Lane (WP) Feb 28, 2018
For years, policymakers have argued that the gravitational pull of the United States would gradually reshape China. That hasn’t happened.

Why fossil fuels survive
Robert J. Samuelson (WP) Feb 28, 2018
The real obstacle to dealing with climate change is our vast dependence on oil, natural gas and coal.

Where are the capital goods orders coming from?
David P. Goldman (AT) Feb 28, 2018
Lopsided investment, yet again favoring energy, is not a good sign for productivity growth.

Inflation Has Been Contained — But Not Because of a Liquidity Trap
Hal Snarr (Mises Wire) Feb 28, 2018
When the Fed began paying interest on bank reserves, it kept a lid on inflation. But now there's no easy way out.

The Worrying Rise of Covert Trade Protectionism
Giovanni Di Lieto (Brink) Feb 28, 2018
The protectionist cloud is growing darker over the G20 economies. Unilateral anti-dumping actions in the commodities industries are creating a new front in the legal trade wars between the major power economies. While the WTO treads water until a more favorable political environment surfaces, the G20 economies face a dilemma. The global trade compact as we know it is broken.

Why Reconsidering the TPP Might Attract Trump
Jeffrey J. Schott (PIIE) Feb 28, 2018
President Donald Trump, who takes pride in being unpredictable, surprised some of the economic bigwigs in Davos in January by declaring that he might reconsider his withdrawal from the Trans-Pacific Partnership (TPP) if he could get a better deal from the other TPP signatories. But it is not clear what he would want from a new deal or whether the other countries would accept significant changes to the TPP-clone accord, renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which they plan to sign in Chile on March 8.

Maybe Cities Don’t Need Tech Hubs to Succeed
Noah Smith (Bloomberg View) Feb 28, 2018
Minneapolis has found a different way to make it in the modern economy.

Trump's Trade Policies Could Work Against Fiscal Stimulus
Timothy A Duy (Bloomberg View) Feb 28, 2018
A steep tariff will undoubtedly impose higher costs on a large swath of the U.S. economy.

Greater Forces Buffet Markets as Fed Seeks 'Normal'
Mark Grant (Bloomberg View) Feb 28, 2018
Higher interest rates will likely cause the current economic expansion to slow, if not stop.

One-Man Rule Isn't Good for the Economy Either
Andrew Polk (Bloomberg View) Feb 28, 2018
In fact, it'll make any serious, liberalizing reforms even harder.

Yen Finds Its Sweet Spot After 50 Years of Trying
Peter Tasker (Bloomberg View) Feb 28, 2018
Japan's currency is finally close to fair value, offering perhaps the healthiest configuration for businesses and investors in decades.

Brexit Is Getting Far Too Much Attention
Daniel Moss (Bloomberg View) Feb 28, 2018
From Asia, it's painfully clear how little Britain's decline actually matters.

Rational Irrational Exuberance?
Andrés Velasco (Project Syndicate) Feb 28, 2018
We tend to be uncomfortable with the notion that an economy’s fundamentals do not determine its asset prices, so we look for causal links between the two. But needing or wanting those links does not make them valid or true.

The Fed Should Be Careful What It Wishes For
Carmen M. Reinhart and Vincent Reinhart (Project Syndicate) Feb 28, 2018
Major central banks’ fixation on inflation betrays a guilty conscience for serially falling short of their targets. It also raises the risk that in fighting the last war, they will be poorly prepared for the next – the battle against too-high inflation.

The ABCs of Doing Business
Kaushik Basu (Project Syndicate) Feb 28, 2018
Every year when the World Bank publishes its report on the "ease of doing business" in 190 economies, countries that fall in the ranking are quick to cry foul or complain about methodological errors. But governments make a much bigger mistake when they view the Doing Business index as a measure of overall wellbeing.

China’s Big-Data Big Brother
Mark Leonard (Project Syndicate) Feb 28, 2018
The Communist Party of China's decision to abolish presidential term limits has raised the possibility that President Xi Jinping, the country's most powerful leader since Mao Zedong, will rule indefinitely. And the cult of personality Xi is creating will be bolstered by the most powerful surveillance state in history.

The EU’s Seven-Year Budget Itch
Jean Pisani-Ferry (Project Syndicate) Feb 28, 2018
On February 23, EU members began negotiations on the bloc's multiannual financial framework for 2021-2027. But, with all countries focusing on net balances – how much they receive minus how much they pay – will the composition of spending bear any relation to the EU’s stated priorities?

The feasibility of sovereign bond-backed securities for the euro area
Philip Lane and Sam Langfield (VoxEU) Feb 28, 2018
The euro area’s macro-financial framework is incomplete and fragile. This column highlights how a market for sovereign bond-backed securities could help to enhance financial stability by providing automatic stabilisation. Drawing on a recent feasibility study published by a High-Level Task Force of the European Systemic Risk Board, it outlines how to pave the way for market development by removing regulatory obstacles.

Can Credit Still Prop Up the Chinese Economy?
Sophia Chen and Lev Ratnovski (VoxChina) Feb 28, 2018
Recent IMF research explores the effectiveness of credit in supporting the Chinese economy, and compares it with the effectiveness of fiscal stimulus. The study finds that credit contributed positively to output growth in China in the early 2000s, but the effect fell to almost zero post-2010. This suggests that, at present, credit cannot effectively support further growth of the Chinese economy. In contrast, the estimated fiscal multiplier is 1.4 post-2010, which is high in international and historic comparisons. Therefore, a targeted fiscal stimulus can cushion the adjustment of the Chinese economy to lower credit growth.

Japan’s Belt and Road Puzzle, Decoded
Titli Basu (Diplomat) Feb 28, 2018
Japan's support for the Belt and Road is contingent on shaping China into a responsible global player.