News & Commentary:

Articles/Commentary

A clearing house crisis will pose a particular threat to Europe
John Dizard (FT) Mar 1, 2019
Grandma is all set to lose again, either on her fund statements or her tax bill.

Trump’s grand growth promises are evaporating
Gillian Tett (FT) Mar 1, 2019
The expectation of low GDP growth has led observers to search for evidence of looming trouble.

Markets must adjust to a new type of sudden shock
Robin Wigglesworth (FT) Mar 1, 2019
Analysis suggests that the calm is being punctuated by a different type of turbulence.

How a second Brexit referendum could be won
Camilla Cavendish (FT) Mar 1, 2019
A spirit of mutual understanding would need to inform debate the second time around.

President Xi to map out China’s road ahead
Gordon Watts (AT) Mar 1, 2019
His keynote speech at the National People’s Congress next week comes amid a changing international landscape.

The alpha shift in Chinese financials
David Goldman (AT) Mar 1, 2019
A buoyant financial sector in the context of last year’s market decline suggests an encouraging structural change.

The most effective way to help Venezuelans: Stop politicizing aid
Jeremy Konyndyk (WP) Mar 1, 2019
This isn't just a matter of doing what’s right — it's a matter of doing what works.

What Happens to Europe When Germany's Economy Slows?
Claudio Grass (Mises Wire) Mar 1, 2019
Germany’s role as the locomotive and economic leader of the entire bloc has been crucial for the last decade.

Ask Your Central Banker If Climate Change Is Hurting You
Nathaniel Bullard (Bloomberg View) Mar 1, 2019
By the time financial companies realize just how natural disasters and rising seas will affect their business, it will probably be too late.

India's Economy Is No Longer One of the Cool Kids
Daniel Moss (Bloomberg View) Mar 1, 2019
A slowdown in GDP growth affirms the nation’s membership of the struggling emerging markets club.

U.K. Inequality Runs Deeper Than You Think
Ferdinando Giugliano (Bloomberg View) Mar 1, 2019
A recent pickup in the Gini coefficient is certainly unwelcome. Persistent intergenerational inequality is more worrying.

Maybe What We Love About the Brexit Drama Is … the Drama
Mark Buchanan (Bloomberg View) Mar 1, 2019
To its most fervent fans, abandoning the whole endeavor would mean crashing back to cold, boring reality.

How Brexit Britain Managed to Lose All of Its Friends
Lionel Laurent (Bloomberg View) Mar 1, 2019
Theresa May’s original negotiating stance didn’t help, but even the U.K.’s most euroskeptic allies have other reasons to toe the Brussels line.

Europe’s Leaders Are Aiding Italy’s Populists
Yanis Varoufakis (Project Syndicate) Mar 1, 2019
The fact that Italy’s public debt has a lower credit rating than private debt is a reflection not of public debt’s intrinsic inferiority but of a political choice made by European leaders. And, by bolstering an authoritarian politician, that choice is now blowing back on them.

The Social Solution to Automation
Nicholas Agar (Project Syndicate) Mar 1, 2019
In our efficiency-obsessed society, new technologies are deployed with the single-minded objective of boosting productivity and eliminating the need for human labor. But rather than worry about the "end of work," we should be expanding the opportunities for human interactions within the framework of a new social economy.

Europe’s Missing Champions
Guy Verhofstadt (Project Syndicate) Mar 1, 2019
There is little doubt that US and Chinese industrial and digital champions will dominate large shares of the global economy in the decades to come. But whether they will be competing with European multinationals depends on the EU’s willingness to update its antitrust policies and expand its digital strategy.

China Syndrome redux: New results on global labour reallocation
Harald Hau, Difei Ouyang and Weidi Yuan (VoxEU) Mar 1, 2019
Trade between the US and China is widely thought to have contributed significantly to the decline in US manufacturing employment between 1999 and 2007. Flipping the point of view, this column examines the impact on China of the growth in trade and finds that for every US manufacturing job lost, almost six new Chinese manufacturing jobs were created. International trade did not contribute to faster wage rises for Chinese industrial workers but instead channelled agricultural and non-participating workers into the industrial labour market.

Historical legacies and African development
Stelios Michalopoulos and Elias Papaioannou (VoxDev) Mar 1, 2019
The effect of colonisation on Africa’s modernisation is a highly contentious and emotional debate. The reality is trickier than you think.

Portugal and the Global Economy: The Way Forward
Christine Lagarde (IMF) Mar 1, 2019
Portugal will have to continue relying on its illustrious tradition of resilience, because the waters of the global economy are likely to become more treacherous.

Brexit Talks Enter a High-Stakes Game-Theory Stage
Amy Davidson Sorkin (New Yorker) Mar 1, 2019
Theresa May’s and Jeremy Corbyn’s recent concessions should make the prospect of a chaotic Brexit in four weeks less likely. But a great deal of uncertainty remains.

The North Korean Economy Is Growing More Capitalist
Toby Harshaw (Bloomberg View) Mar 2, 2019
The question is just how close will it get – the East Germany model or the Vietnam approach? Stephan Haggard explores the possibilities.

'The Globotics Upheaval' Review: When the Robot Gets an Office
Marc Levinson (WSJ) Mar 3, 2019
New robotics and AI technologies may soon be coming for the jobs of those who untili now have only known globalization's benefits.

Who brought us this long boom?
Robert Samuelson (WP) Mar 3, 2019
We’re months away from setting the record for the longest economic expansion in U.S. history.

Trump Should Take Aim at China’s Joint-Venture Rule
Noah Smith (Bloomberg View) Mar 3, 2019
The partnerships required to do business in the country are a cover for stealing U.S. know-how.

The $22 Billion That's Spooking India's Bond Market
Andy Mukherjee (Bloomberg View) Mar 3, 2019
Off-budget borrowing by state firms is adding strain and pushing up the cost of long-term money. Animal spirits are noticeably tame.

The Bomb That Blew Up in 2008? We’re Planting Another One
Satyajit Das (Bloomberg View) Mar 3, 2019
Collateralized loan obligations may look safe but they pose risks that are poorly appreciated.

Immigration and wage dynamics after Mexico's peso crisis
Joan Monras (VoxEU) Mar 3, 2019
Arguments over the effect of immigration on labour market outcomes focus on a single number: the impact on low-skill wages. The column uses a model of the adjustment process of labour markets in the US to the peso crisis of 1995 to show there is a difference between short-run and long-run effects. The model suggests that state-level policies are unlikely to be effective.

The agency of CoCos: Why contingent convertible bonds aren’t for everyone
Roman Goncharenko, Steven Ongena and Asad Rauf (VoxEU) Mar 3, 2019
Most regulators grant contingent convertible bonds the status of equity. The theory, however, suggests that these securities can distort banks’ incentives to issue new equity. Using a model and European data, this column shows that banks with lower risk are more likely to issue CoCos compared to their riskier counterparts. In line with Basel III, banks are expected to raise equity prior to CoCo conversion, which makes the bonds an expensive source of capital. The design of CoCos should be revised if they are to enjoy equity-like treatment.

Federal Reserve’s fundamental rethink about inflation
Gavyn Davies (FT) Mar 3, 2019
Can monetary regime prevent US from morphing into eurozone or Japan in next recession?

China gains the upper hand over Germany
Wolfgang Münchau (FT) Mar 3, 2019
Berlin is paying for its political choices on public sector debt reduction.

China’s winning streak driven by investors taking long view
Fabiana Fedeli (FT) Mar 4, 2019
Despite the threat of the trade dispute, most see some light at the end of the tunnel.

China, India and the rise of the ‘civilisation state’
Gideon Rachman (FT) Mar 4, 2019
This illiberal idea is also appealing to some on the American right.

The left’s embrace of modern monetary theory is a recipe for disaster
Lawrence Summers (WP) Mar 4, 2019
Modern monetary theory is the “voodoo economics” of our time.

Finding an antidote for China’s economic flu
Gordan Watts (AT) Mar 4, 2019
Premier Li Keqiang is expected to reveal parts of the remedy at the National People’s Congress.

China and its orbit are where the returns are
David Goldman (AT) Mar 4, 2019
There are a number of reasons to believe this year’s rally in Chinese equities has legs.

Deutsche and Commerzbank: why Berlin is backing a merger
Stephen Morris, David Crow and Olaf Storbeck (FT) Mar 4, 2019
Rumoured for a decade, the move to combine Germany’s two largest banks now has political backing.

Behind China’s Desire for a Trade Deal With Trump
Jonathan Kolatch (WSJ) Mar 4, 2019
President Xi’s nationalism is running into the reality of slower growth and a fear of political instability.

Global Insurance Pricing Continues Its Rise
Dean Klisura (Brink) Mar 4, 2019
Global commercial insurance prices rose by 2 percent in the fourth quarter of 2018, marking a fifth consecutive quarter of increases, according to the Marsh Global Insurance Market Index. The results of the survey—and what they mean.

The Africa Continental Free Trade Area: An opportunity to deepen cooperation on regional public goods
Jaime de Melo (Brookings) Mar 4, 2019
The Africa Continental Free Trade Area (AfCFTA) signed in March 2018 aims to establish a single market across the continent. This challenge is also an opportunity to extend the provision of regional public goods beyond hard infrastructure. Peace and security, mining, and energy are such examples covered in the Africa Economic Outlook 2019.

The possible Chinese-US trade deal
Jan Mazza (Bruegel) Mar 4, 2019
The future of Sino-American relations after the incoming end of trade talks between Beijing and Washington. We review opinions in the English-speaking blogosphere on the likely content of the deal and the message this agreement sends to the world.

The welfare debate the US should be having
Michael Strain (AEI) Mar 4, 2019
What does society owe those who are “unwilling to work,” and what do they owe their communities?

The Fed Is Moving to Take Even More Control of Debt Markets and Interest Rates
Thorsten Polleit (Mises Daily) Mar 4, 2019
The Fed is prepared to squeeze out what little is left of the free market forces in the debt market. The Fed wants full control so it can do "whatever it takes" to keep interest rates from rising above its very-low targets.

The ECB Is Speaking With Too Many Voices
Marcus Ashworth (Bloomberg View) Mar 4, 2019
It’s hard to get a clear sense of how the bank will manage the slowdown in Europe. The euro zone needs to identify Mario Draghi’s successor quickly.

For Europe, Hell Is Two More Years of Brexit
Lionel Laurent (Bloomberg View) Mar 4, 2019
A long delay to the Brexit process is a bad idea for everyone, both in the U.K. and Europe. The EU should quit while it’s ahead.

China and India Stumble Into Monetary Leadership
Daniel Moss (Bloomberg View) Mar 4, 2019
As the world's central banks turn dovish, Beijing and New Delhi stand out for taking action. Yet few economists see imminent steps elsewhere.

Europeans Are Leaving Britain (Poorer)
Therese Raphael (Bloomberg View) Mar 4, 2019
Shunning low-skilled labour, as the U.K. is doing post-Brexit, is a monumental act of self-harm.

Three Things Trump Can Do to Keep the Economy Humming
Karl W Smith (Bloomberg View) Mar 4, 2019
The president should end the trade war, extend tax reform and expand immigration.

Deficit Hubris Looks Like the Next Economics Mistake
Noah Smith (Bloomberg View) Mar 4, 2019
Those who now say debt doesn’t matter are repeating the errors of those who said the Great Recession couldn’t happen.

Renewing Europe
Emmanuel Macron (Project Syndicate) Mar 4, 2019
European citizens need to learn from the Brexit impasse and apply those lessons ahead of and after the European Parliament election in May. That means embracing reforms that advance the three goals that lie at the heart of the European project.

Brexit Is Hell
Harold James (Project Syndicate) Mar 4, 2019
Over time, public conceptions of hell have migrated from the realm of religious belief to that of literature and political aphorism. And nowhere is the idea of eternal damnation as punishment for one's own choices more appropriate than in the case of the United Kingdom as it hurdles toward the Brexit abyss.

Modern Monetary Nonsense
Kenneth Rogoff (Project Syndicate) Mar 4, 2019
A number of leading progressive US politicians advocate using the Federal Reserve's balance sheet to fund expansive new government programs. Although their arguments have a grain of truth, they also rest on some fundamental misconceptions, and could have unpredictable and potentially serious consequences.

The Schumpeterian role of banks
Christian Keuschnigg and Michael Kogler (VoxEU) Mar 4, 2019
Only strong banks can fulfil their Schumpeterian role by efficiently reallocating credit. The column argues that high capital standards, efficient bankruptcy laws, and a lower cost of bank equity improve credit reallocation and thereby support the productive specialisation of the economy. An efficient banking sector also magnifies the gains from trade liberalisation by easing the process of capital reallocation.

France, inequality, and the social elevator
Laurence Boone and Antoine Goujard (VoxEU) Mar 4, 2019
The ‘yellow vest’ demonstrations in France appear, at least in part, to be another example of the anti-globalisation sentiment that has emerged in a number of OECD countries. This column argues that the movement is also rooted in the country’s broken social elevator. Redistribution through taxes and social transfers is not sufficient to curb the inequality in opportunity, which is mostly linked to the educational system and perpetuates economic and social situations from one generation to the next.

Modeling Financial Crises
Pascal Paul (FRBSF Econ Letter) Mar 4, 2019
Research has revealed several facts about financial crises based on historical data. Crises are rare events that are associated with severe recessions that are typically deeper than normal recessions. They are usually preceded by a buildup of system imbalances, particularly a rapid increase of credit. Financial crises tend to occur after prolonged booms but do not necessarily result from large shocks. Recent work shows a novel way to replicate these facts in a standard macroeconomic model, which policymakers could use to gain insights to prevent future crises.

Two Thine Own Inflation Target Be True?
Jay H. Bryson, Sarah House and Erik Nelson (WF) Mar 4, 2019
In the first of a series of reports examining how the Fed's framework and toolkit may evolve in the coming years, we look at potential changes to the Fed's current inflation target. After watching inflation average less than 2% over the past two decades, officials would like to see it run slightly higher in order to provide more space to cut real interest rates during future recessions.

Japan’s foreign bond binge suggests yen weakness will linger
Leo Lewis (FT) Mar 5, 2019
The currency is also particularly susceptible to momentum trading.

Brexiters are refusing to accept their victory
Robert Shrimsley (FT) Mar 5, 2019
Hardliners now pose the biggest threat to the UK leaving the EU.

The US strategy is not the best way to deal with Huawei
Kishore Mahbubani (FT) Mar 5, 2019
The Chinese telecoms company has made strenuous efforts to adapt to global norms.

What if All the World’s Economic Woes Are Part of the Same Problem?
Neil Irwin (NYT) Mar 5, 2019
Research suggests that the challenges aren’t a series of single strands, but a spider web of them.

The World Bank must reject Trump’s nominee to lead it
John Podesta and Kristina Costa (WP) Mar 5, 2019
David Malpass is unfit for the post.

The Art of Italian Bookkeeping (Cont.)
Agnieszka Gehringer (Globalist) Mar 5, 2019
Italy’s budget plan should be treated for what it is – a pie in the sky.

China Has a Dirty $1 Trillion Stimulus Secret
Shuli Ren (Bloomberg View) Mar 5, 2019
Another economy-boosting infrastructure binge is afoot, but you won’t find it reflected in the fiscal deficit target.

China’s Too Big Not to Slow Down
Daniel Moss (Bloomberg View) Mar 5, 2019
Get used to growth estimates grinding lower. That’s what happens when you become a big, maturing economy.

Taleb Was Right. We’re Still Fooled by Randomness
Mark Gilbert (Bloomberg View) Mar 5, 2019
You know you shouldn’t chase “hot hands” in the fund management industry. This study says you really, really shouldn’t.

Frankenstein Capitalism Is Stalking Europe
Ferdinando Giugliano (Bloomberg View) Mar 5, 2019
After getting knocked back on Alstom-Siemens, France and Germany are eager to back the cobbling together of European champions. It’s a recipe for disaster.

Macron Is Getting Ahead of Himself on Europe
Leonid Bershidsky (Bloomberg View) Mar 5, 2019
The French president’s European election agenda is overambitious and badly thought out.

China’s Tax Cuts Just Won’t Cut It
Anjani Trivedi (Bloomberg View) Mar 5, 2019
The manufacturing sector needs something better. Ramping up government spending or monetary easing would be more effective.

Tense transatlantic relations put EU in tough spot
Maria Demertzis (Bruegel/Capital) Mar 5, 2019
The global multilateral system is being challenged by the US and China, which prompts the EU to rethink how well it can compete in the world.

Recessions Are Getting Tougher to Predict
Timothy A Duy (Bloomberg View) Mar 5, 2019
Slower growth and higher variability means there is a greater probability of periodic economic contractions.

The impact of population ageing on monetary policy
Marcin Bielecki, Michal Brzoza-Brzezina & Marcin Kolasa (VoxEU) Mar 5, 2019
Population ageing is likely to affect many areas of life, from pension system sustainability to housing markets. This column shows that monetary policy can be considered another victim. Low fertility rates and increasing life expectancy substantially lower the natural rate of interest. As a consequence, central banks are more likely to hit the lower bound constraint on the nominal interest rate and face long periods of low inflation, especially if they fail to account for the impact of demographic trends on the natural interest rate in real time.

The noise in stock prices matters for the real economy
Olivier Dessaint, Thierry Foucault, Laurent Frésard and Adrien Matray (VoxEU) Mar 5, 2019
Stock prices respond to fundamental shocks (i.e. news) and non-fundamental shocks (noise). Using US data from 1996 to 2011, this column argues that stock prices are a ‘faulty informant’ for corporate managers because managers have limited ability to separate information from noise when using prices as signals about their prospects. The ensuing losses of capital investment and shareholders’ wealth are large and even affect firms that are not facing severe financing constraints or agency problems.

The impact of population ageing on monetary policy
Marcin Bielecki, Michal Brzoza-Brzezina and Marcin Kolasa (VoxEU) Mar 5, 2019
Population ageing is likely to affect many areas of life, from pension system sustainability to housing markets. This column shows that monetary policy can be considered another victim. Low fertility rates and increasing life expectancy substantially lower the natural rate of interest. As a consequence, central banks are more likely to hit the lower bound constraint on the nominal interest rate and face long periods of low inflation, especially if they fail to account for the impact of demographic trends on the natural interest rate in real time.

Firm's expectations of inflation matter: New evidence
Olivier Coibion, Yuriy Gorodnichenko and Tiziano Ropele (VoxEU) Mar 5, 2019
With nominal short-term interest rates close to their effective lower bound, monetary policies partly operate through changing the inflation expectations. This column analyses the causal effect of inflation expectations on firms’ economic decisions in Italy. Higher inflation expectations on the part of firms leads them to raise their prices, increase their utilisation of credit, and reduce their employment. But when policy rates are constrained by the effective lower bound, expansionary effects are stronger, leading firms to raise their prices more and no longer reduce their employment.

Does a Strong Currency Help, or a Weak One?
Farok J. Contractor (YaleGlobal) Mar 10, 2019
Currencies are fluid with pros and cons to over- and undervaluation, depending on a nation's circumstances.

A Central American Marshall Plan Won’t Work
Ryan C. Berg (FP) Mar 5, 2019
Mexican President Andrés Manuel López Obrador’s calls for a Central American Marshall Plan rest on a common misunderstanding of the original.

Can China’s superstar tech companies connect with US customers?
Elaine Moore (FT) Mar 6, 2019
WeChat and Alipay are growing fast but the trade war and a tech backlash may hold them back.

Dirty money scandal taints image of Nordic nations
Richard Milne (FT) Mar 6, 2019
Western countries with clean reputations are an essential part of alleged corruption.

Emerging markets cut reliance on foreign bank credit
Steve Johnson (FT) Mar 6, 2019
Trend should help developing countries withstand global shocks.

‘Big Oil’ is rapidly becoming ‘Big Shale’
David Sheppard (FT) Mar 6, 2019
Bullish production forecasts from US supermajors make unhappy reading for Opec nations.

Xi needs a trade deal as much as Trump does
Raghuram Rajan (FT) Mar 6, 2019
While elected leaders can blame predecessors in bad times, Beijing must appear unfailing.

The ECB must reconsider its plan to tighten
Martin Wolf (FT) Mar 6, 2019
Central bank should act to prevent the eurozone from slipping into another recession.

Will the Fed be there if markets cry out for another quick fix?
Katie Martin (FT) Mar 6, 2019
Risks of complacency rise as investors struggle to remember the last bear market.

Trade Deficit Freak Out
WSJ Mar 6, 2019
The rising gap is the result of faster growth. There’s no need to panic.

What’s behind the ballooning trade deficit
Catherine Rampell (WP) Mar 6, 2019
Spoiler: It's President Trump's own policies.

China’s GDP high-wire act heats up
William Pesek (AT) Mar 6, 2019
Premier Li tries to pull off a balancing act as trade war trips up the world's second-largest economy

Unbreaking the glass
David Goldman (AT) Mar 6, 2019
Amid persistent trade tensions and weak consumption there is no indication that business investment will recover this year

What Can Brexit Teach Us About Blockchain’s Use Cases?
Alisa DiCaprio and George Calle (Brink) Mar 6, 2019
Blockchain is not a Band-Aid. It can't "solve" Brexit. But, as trade uncertainty continues to disrupt supply chains, Brexit presents a rare opportunity to explore the potential for blockchain to link up and smooth some of the most difficult areas of trade. How blockchain can help resolve trade disruption.

Greece’s Pyrrhic Victory
Thomas Mayer (Globalist) Mar 6, 2019
EMU membership keeps Greece locked in deflationary debt and cost reduction.

China's Slowdown is Exposing the Cracks in the Global Economy
Claudio Grass (Mises Wire) Mar 6, 2019
Since 2008, China has amassed a mountain of debt, and continues to operate countless "zombie" companies and money-losing factories.

Fiscal Discipline Is Not Passé
Bloomberg View Mar 6, 2019
Government borrowing is often essential — but it needs to be done responsibly.

Trump’s Huge Trade Deficit Means America Is Doing Great
Karl W Smith (Bloomberg View) Mar 6, 2019
It's a sign of economic strength when consumers snap up imports.

U.S. Trade Snub Should Be Wake-Up Call for India
Mihir Sharma (Bloomberg View) Mar 6, 2019
The global manufacturing scene is changing rapidly, but a protectionist New Delhi has put itself in no position to benefit.

Aussie Workers Can Make or Break a Famous Run
Daniel Moss (Bloomberg View) Mar 6, 2019
The nation’s three-decade expansion streak hinges on jobs and income, not house prices. The central bank may want some insurance.

Girls Have Always Been Better at School. Now It Matters More.
Justin Fox (Bloomberg View) Mar 6, 2019
The higher-education gender gap has become a major factor in American political and economic life, and it yawns even wider in other rich countries.

Will Trump’s India Tariffs Work? Here’s a Shiny Clue
Andy Mukherjee (Bloomberg View) Mar 6, 2019
An analysis of jewelry exports shows that higher duties may be a less-decisive factor than consumers’ shifting tastes.

The Beneficial Ripple Effects of Greater Women’s Empowerment
Mohamed Aly El-Erian (Bloomberg View) Mar 6, 2019
A White House initiative is well designed. The next step is effective implementation.

Why Eastern Europe Doesn’t Want to Join the Euro
Leonid Bershidsky (Bloomberg View) Mar 6, 2019
Czech Prime Minister Andrej Babis dresses up his political objections in woolly economic logic.

Don’t Assume That the Fed Is Done Raising Rates
William C Dudley (Bloomberg View) Mar 6, 2019
The economy could yet justify more tightening.

Even the Germans Can’t Deny Economic Reality in Europe
Marcus Ashworth (Bloomberg View) Mar 6, 2019
The Bundesbank said it would need a monetary policy reason for bringing back cheap loans. It appears to have one now. More ECB stimulus is needed.

How to Achieve Health Equity
Eric A. Friedman (Project Syndicate) Mar 6, 2019
Last year’s United Nations report on progress toward achieving the SDGs showed that the number of people facing hunger is actually growing, as is the number of malaria cases. This is disappointing, but not surprising.

Trump’s Imperial Overreach on Trade
Daniel Gros (Project Syndicate) Mar 6, 2019
As part of its effort to contain its main global rival, the US is trying to secure the power to prevent the United Kingdom and the European Union from so much as negotiating trade agreements with China. Although a post-Brexit UK will probably have little choice but to follow Canada’s lead and comply, the EU is big enough to say no.

China’s Quiet Central Banking Revolution
Miao Yanliang and Yanliang Miao (Project Syndicate) Mar 6, 2019
Since Yi Gang became governor in March 2018, the People’s Bank of China has improved its communications, boosted its transparency, and moved toward a flexible exchange rate. Although the PBOC has plenty of room for further improvement, its progress so far is good news for China and international policymakers alike.

In the Shadows of the Government: Relationship-building during Political Turnovers
Hanming Fang, Zhe Li, Nianhang Xu and Hongjun Yan (VoxDev) Mar 6, 2019
We document that firms use two instruments to build relationships with local government officials in China: “perk spending” and personnel changes. Following a turnover in the positions of Party Secretary or Mayor of a city in China, firms (especially private firms) headquartered in that city significantly increase their perk spending. Both the instrumental variable-based results and heterogeneity analysis support the interpretation that perk spending is used to build relationships with local governments. Moreover, state-owned firms, particularly those controlled by the local government, tend to change their key personnel (Chairmen or CEOs) following the local political turnover. However, the Chairmen or CEOs who have connections with local government officials are less likely to be replaced.

Central bank digital currency: Concepts and trends
Sayuri Shirai (VoxEU) Mar 6, 2019
Recent years have seen the emergence of digital currencies such as Bitcoin as potential private sector money. Central banks are also considering whether to issue their own digital tokens to enable decentralised verification of transactions while maintaining attractive cash-like features. This column lays out the four existing proposals for implementing central bank digital currency. Due largely to technical constraints, however, central banks in general have not found a compelling reason to issue their own digital currency.

Spatial correlation and inequality
Jonathan Dingel and Kyle Meng (VoxEU) Mar 6, 2019
Climate change is expected to reshape the global distribution of productivities. In theory, shifts in the spatial structure of economic conditions will affect international inequality by altering the pattern of international trade. In practice, it is hard to identify natural experiments to causally validate predictions about global conditions. This column describes research that exploits a global climatic phenomenon to estimate the general equilibrium consequences of changes in the spatial correlation of productivities.

Will Thailand’s China-Built Railway Be Worth It?
Pechnipa Dominique Lam (Diplomat) Mar 6, 2019
The government is rushing ahead with the high-speed rail, even as the public is left in the dark.

Demystifying Debt Along China’s New Silk Road
Sophie van der Meer (Diplomat) Mar 6, 2019
Is Beijing really seeking to buy political influence abroad?

The Economic Outlook: The ‘New Normal’ Is Now
John C. Williams (FRBNY) Mar 6, 2019
Understanding the fundamentals driving g-star and r-star provides a helpful backdrop for what’s going on in the economy today, and an indication of what we should expect in the future.

The Problem With Xi’s China Model
Elizabeth C. Economy (FA) Mar 6, 2019
Why its successes are becoming liabilities.

Window Closes on Further Bank of Japan Policy Action
Brendan McKenna and Nick Bennenbroek (WF) Mar 6, 2019
After a period of steady growth, Japan's economy has slowed more recently, while inflation remains well below the central bank's target. As the economic outlook remains underwhelming, along with a more dovish tone from global central banks, we no longer expect the Bank of Japan to tighten monetary policy in Q2-2019. Despite our forecast policy change, we believe the path for the yen remains relatively unchanged.

Nigeria’s president has a chance to make amends
FT View Mar 7, 2019
Muhammadu Buhari should use his second term to pursue a dynamic and coherent agenda.

The EU must match China’s drive to invest
FT View Mar 7, 2019
Italy and others should recognise the Belt and Road Initiative’s geopolitical goals.

For clues on the dollar, watch Beijing not Washington
Ebrahim Rahbari (FT) Mar 7, 2019
A turn in the greenback is due, but it will take global growth to improve first.

Macro hedge funds keep praying for volatility
Laurence Fletcher (FT) Mar 7, 2019
The outlook for big bets on stocks, bonds and currencies should really be improving.

Will ECB ever be able to abandon monetary stimulus?
Martin Sandbu (FT) Mar 7, 2019
The economy has turned out, time and again, to be weaker than expected.

Uzbekistan embarks on unexpected economic reforms
Economist Mar 7, 2019
Government officials are forbidden from harassing small businesses.

How to revive Algeria
Economist Mar 7, 2019
Decrepit rulers are holding back a country with enormous potential.

The new scramble for Africa
Economist Mar 7, 2019
This time, the winners could be Africans themselves.

How About We Try Modern Monetary Theory in a Small Country First?
Neil Irwin (NYT) Mar 7, 2019
People are taking its ideas more seriously, but reinventing the system in the world’s largest economy on the fly seems risky.

Emerging Market Equities: Looking Beyond Near-Term Fear
Christopher J. Brightman and Raji O. Manasseh (PIMCO) Mar 7, 2019
We see two overarching reasons for long-term investors to consider continuing to hold a strategic allocation to EM equities: fundamentals and valuations.

What’s next for Brexit as Britain plays the ultimate game of ‘Deal or No Deal’
Amanda Sloat (Brookings) Mar 7, 2019
As the British Parliament prepares to hold another key vote tomorrow on Theresa May’s withdrawal agreement, Amanda Sloat examines the remaining possible Brexit outcomes and the paths to those outcomes as the March 29 deadline looms.

Why the ECB Followed the Fed’s Flip-Flopping
Mohamed Aly El-Erian (Bloomberg View) Mar 7, 2019
Extraordinary steps tell markets to expect sharply slower growth, continued low interest rates and increased central bank liquidity.

Fishing for Alpha? Take Your Investing Net to China
Shuli Ren (Bloomberg View) Mar 7, 2019
A market bursting with IPO candidates and dominated by retail investors offers a rare haven for stock pickers.

China’s Thirst for Oil Is No Tempest in a Teapot
David Fickling (Bloomberg View) Mar 7, 2019
Demand from small refiners is triggering a surge of exports that threatens to undermine profits for rivals across Asia.

China Finds a G-7 Ally for Belt and Road
Ferdinando Giugliano (Bloomberg View) Mar 7, 2019
Italy’s trading relationship with China goes back to Marco Polo, but it’s ironic that the “Italy first” populists want to cosy up to Beijing.

The World’s Favorite Scapegoat Gets a Pass
Daniel Moss (Bloomberg View) Mar 7, 2019
Lower projections for global growth have become a cottage industry. China has been a noticeably low-profile factor.

The World Really Is Getting Richer as Poor Countries Catch Up
Noah Smith (Bloomberg View) Mar 7, 2019
Arguments that extreme poverty is on the rise don’t match the data.

ECB Takes a First Step to Admitting Its Mistake
Marcus Ashworth (Bloomberg View) Mar 7, 2019
Officials have growing concerns on the economy. That their stimulus came so soon after QE ended suggests some issues with decision making.

From microeconomic favouritism to macroeconomic populism
Gilles Saint-Paul (VoxEU) Mar 7, 2019
Macroeconomic populism typically leads to higher levels of public debt, public spending, deficits, and crises. Nevertheless, this column argues that it is rational for groups of voters to vote for a populist who reflects their interests, because they will be favoured when a fiscal adjustment occurs. The greater the fiscal adjustment required, the more likely voters are to elect a populist who will discriminate between groups.

How finance affects income inequality
Michael Brei, Giovanni Ferri and Leonardo Gambacorta (VoxEU) Mar 7, 2019
There is mounting evidence that income inequality and disparities in wealth have been rising in advanced economies in the recent decades. Using data on advanced and emerging economies, this column investigates the link between an economy's financial structure – that is, the mix of bank-provided versus market-provided funds – and income inequality. Results show that the relationship is not monotonic. More finance reduces income inequality up to a point, but beyond that point inequality rises, especially if finance is expanded via market-based financing.

Banking on Refugees
Jacqueline Musiitwa (Project Syndicate) Mar 7, 2019
Refugees have long been excluded from financial services, leaving them struggling to integrate into host economies. But new technologies have made the lack of an identity card, loan collateral, or a fixed address irrelevant, and the world's displaced people may be only the first to benefit.

China and Saudi Arabia Converge on Pakistan
Dilip Hiro (YaleGlobal) Mar 7, 2019
Gwadar Port links China and Saudi Arabia after the US cuts $2.1 billion in aid.

Navigating Cautiously
Lael Brainard (FRB) Mar 7, 2019
While our economy continues to add jobs at a solid pace, demand appears to have softened against a backdrop of greater downside risks. Prudence counsels a period of watchful waiting--especially with no signs that inflation is picking up. With balance sheet normalization now well advanced, it will be appropriate to wind down asset redemptions later in the year.

The Looming UK Brexit Mess
Dan Steinbock (WFR) Mar 7, 2019
After the misguided referendum three years ago, the Brexit end-game is about to begin. In the UK, it means political division and fiscal erosion. Moreover, global growth prospects will not remain immune to turmoil in the world’s fifth largest economy.

ECB: When Doves Fly
Erik Nelson, Nick Bennenbroek and Brendan McKenna (WF) Mar 7, 2019
The ECB made two key policy changes today. First, it pushed back its interest rate guidance to signal the first hike probably will not come this year. It also announced a new package of TLTROs, the terms of which were not as favorable as past offerings.

World needs to change the way it taxes companies
Martin Wolf (FT) Mar 8, 2019
A ‘destination-based’ corporate taxation system has a great deal going for it.

Why big loans are unravelling old empires in India
Simon Mundy (FT) Mar 8, 2019
Investors wary of companies that have pledged large amounts of stock as collateral

Don’t let emerging markets be the ‘something that breaks’
José Antonio González (FT) Mar 8, 2019
The Fed is stirring a perfect storm and EM policymakers must act while they can.

Xi’s Economy Needs Trump’s Help
WSJ Mar 8, 2019
A trade deal could help China’s economy more than Beijing’s tepid stimulus.

Our ballooning budget deficit reflects an unhealthy democracy
WP Mar 8, 2019
Why aren’t our leaders worried about the deficit?

The more we learn about Brexit, the more crooked it looks
Anne Applebaum (WP) Mar 8, 2019
The strange story of Arron Banks.

Erdogan cannot ignore Trump's trade wars
Byozlem Albayrak (AT) Mar 8, 2019

A Global Imperative
Christine Lagarde (IMF) Mar 8, 2019
March 8 marks International Women’s Day, which provides a chance to reflect on the struggle for greater gender equality. The roots of this annual event reach back more than a century, yet its focus on respect and opportunities for women remains strikingly relevant today—from sexual harassment and violence to unequal laws and unfairness in the workplace, where women are too often underemployed, underpaid, and underpromoted.
In the past, the US president's trade move against Turkey would not have made a dent – but now it's different

US Trade Deficit with China Keeps Growing, Even with Tariffs
Jeffrey J. Schott and Zhiyao (Lucy) Lu (PIIE) Mar 8, 2019
Despite the Trump administration’s penalty tariffs on China, the US goods trade deficit with the country is 10 percent higher than it was in 2017, projected to reach $413 billion in 2018. The US-China trade war has not prevented Chinese firms from shipping more exports to the United States. Total US imports from China are up 6 percent from 2017, while US exports to China are down 5 percent. The global US goods trade deficit is up 10 percent from last year, with China’s share of the deficit remaining constant.

Don’t Let ‘Opportunity Zones’ Be Just Another Tax Loophole
Bloomberg View Mar 9, 2019
To ensure taxpayers get value for their money, investors in struggling areas should share detailed information about their projects.

Europe Isn’t Ready for the Next Recession
Bloomberg View Mar 8, 2019
Its central bank just loosened monetary policy. What if that isn’t enough?

History Could Doom U.S.-China Trade Deal
Michael Schuman (Bloomberg View) Mar 8, 2019
By pushing for something that looks like an unequal treaty, Washington is virtually guaranteeing it will break down.

The Real Problem With Negative Rates
Richard Barwell (Bloomberg View) Mar 8, 2019
The ECB knows negative rates can mean lower bank lending; but retreating brings other risks.

China Could Outrun the U.S. Next Year. Or Never
David Fickling (Bloomberg View) Mar 8, 2019
Extrapolating when the world’s second-biggest economy will overtake the first is a tricky business riddled with caveats.

Is China Really the Economic Juggernaut We Feared?
Daniel Moss (Bloomberg View) Mar 8, 2019
In a week bookended by Premier Li’s address and a buzzy academic paper, we get a reminder that growth just isn’t what it used to be.

Draghi’s Stimulus Gift Looks a Bit Stingy
Ferdinando Giugliano (Bloomberg View) Mar 8, 2019
A murky economic outlook supports a moderate approach to policy. Since the ECB chose to act rather than wait, it could only do so much.

China's Retail Investors Are No Suckers
Shuli Ren (Bloomberg View) Mar 8, 2019
There were sound reasons to favor the high-flying stocks that led the market’s stumble on Friday.

Keep an Eye on That Unemployment Rate
Justin Fox (Bloomberg View) Mar 8, 2019
Unemployment troughs invariably precede recessions. We’re not there yet, but the rate does seem to have stopped falling.

Norway’s Oil Disposal Drama Descends Into Farce
Liam Denning (Bloomberg View) Mar 8, 2019
Sovereign wealth fund divestments may answer a political need but don’t move the needle much.

The Conventional Wisdom About Stock Buybacks Is Wrong
Stephen Gandel (Bloomberg View) Mar 8, 2019
Stock repurchases may not be the best use of a company’s money, but not because they benefit shareholders over everyone else.

Helping Women Crack the “Export Code”
Arancha González (Project Syndicate) Mar 8, 2019
As the world commemorates this year's International Women's Day, there can be no doubt that significant progress has been made worldwide toward achieving gender parity. But until the barriers blocking women's access to global trade are removed, that goal will remain out of reach.

The Revolt Against Big Food
Jayati Ghosh (Project Syndicate) Mar 8, 2019
Today’s food problem is not absolute scarcity. It is that food is so unequally distributed and irrationally consumed that the world’s most deprived people die or suffer from cognitive impairment because of undernutrition, while others face death or disease because of obesity.

Europe in the Shadows
Sigmar Gabriel (Project Syndicate) Mar 8, 2019
With the world increasingly dominated by the US and China, Europe must develop a much stronger common voice on economics, defense, and trade. But this will require Germany, in particular, to rethink some of its long-held positions.

Foreign Exchange Intervention in Latin American Countries with Inflation Targets
David Lipton (IMF) Mar 8, 2019
Since the 1990s, most large Latin American economies have transitioned to inflation targeting with flexible exchange rates. In some cases, this transition came after crises that highlighted the shortcomings of pegged currency regimes. Within this transition to inflation targeting, countries experimented with various degrees of exchange rate flexibility. While some rarely intervene anymore, some use it actively. But our understanding of many aspects of foreign exchange intervention remains limited.

The Brexit Endgame
Amy Davidson Sorkin (New Yorker) Mar 8, 2019
Brexit is scheduled to take place on March 29th—but the United Kingdom isn’t ready.

A Weak Jobs Report Isn’t All That Donald Trump Has to Worry About
John Cassidy (New Yorker) Mar 8, 2019
A recession may not be in the cards anytime soon, but an economic slowdown is apparently under way—just in time for an election year.

The ECB is attempting to get ahead of events
FT View Mar 9, 2019
With economic risks again mounting, the EU needs new instruments.

Why asset managers are mimicking the activists
James Fontanella-Khan (FT) Mar 9, 2019
Wellington’s intervention in Bristol-Myers M&A battle could prove a turning point.

The safe exit from this bull market will be narrow
Michael Mackenzie (FT) Mar 9, 2019
A decade ago was the time to buy, but a decade of cheap money has also created hazards.

Will Trump Trade the Future for a Hill of Beans?
NYT Mar 9, 2019
The outlines of a potential trade deal with China suggest President Trump once again is prioritizing superficial gains over America’s long-term economic interests.

America’s Most Profitable Export: Money
Binyamin Appelbaum (NYT) Mar 9, 2019
The world has a growing appetite for small green pieces of paper with Benjamin Franklin on the front.

How Do You Replace the Most Important Number in the World?
Satyajit Das (Bloomberg View) Mar 9, 2019
As markets prepare to move away from the benchmark Libor, they risk sparking confusion and chaos.

Slashing Tariffs Won't Redeem a No-Deal Brexit
Therese Raphael (Bloomberg View) Mar 9, 2019
Eliminating trade barriers is always welcome. Just don't claim it will make a big difference to the cost of leaving the EU.

Firm financing after the Global Crisis
Natasha Kalara, Lu Zhang, Karen van der Wiel (VoxEU) Mar 9, 2019
The Global Crisis has profoundly changed the financial landscape, including firm financing. This column examines the development of various channels of firm financing before and after the crisis among four groups of EU countries, the US, and Japan. While bank finance and, to some extent, equity finance are under pressure, alternative finance, although small, seems to be on the rise.

China’s cyclical recovery is picking up steam
Gavyn Davies (FT) Mar 10, 2019
Growth rebounds as the threat of trade war recedes and domestic stimulus takes effect.

South Africa: Battling to keep the lights on
Joseph Cotterill (FT) Mar 10, 2019
Amid escalating debt and widespread blackouts, state power company Eskom could lose its century-old monopoly.

The Stock Buyback Panic
WSJ Mar 10, 2019
Repurchases reallocate under-utilized capital to more efficient purposes.

Trump failed by his own trade metric. Pursue it further, and we’re doomed.
Robert Samuelson (WP) Mar 10, 2019
The president argues that a rising deficit destroys jobs — but then boasts about low unemployment under his watch.

India’s elections a struggle for the country’s soul
Robin Jeffrey (EAF) Mar 10, 2019
Modi's many initiatives have achieved mixed results and face implementation challenges.

China Is Strangling Its Private Champions
Christopher Balding (Bloomberg View) Mar 10, 2019
By taking over the deposits of platforms like Alipay and WeChat Pay, the PBOC is making a power grab. All in the name of protecting consumers.

Want to Understand the Shale Boom? Try a Microscope
Julian Lee (Bloomberg View) Mar 10, 2019
All crude oil is not created equal. Once you know why, you'll understand how OPEC cuts and the U.S. oil boom are upending markets.

Accounting for macro-finance trends
Emmanuel Farhi and Francois Gourio (VoxEU) Mar 10, 2019
Most developed economies have experienced large declines in risk-free interest rates and lacklustre investment over the past 30 years, while the profitability of private capital has increased slightly. Using an extension of the neoclassical growth model, this column identifies what accounts for these developments. It finds that rising market power, rising unmeasured intangibles, and rising risk premia play a crucial role, over and above the traditional culprits of increasing savings supply and technological growth slowdown.

Easing financial controls is cause for wariness
FT View Mar 11, 2019
The peak of the market is just the time when defences should be raised.

International tax overhaul essential
Christine Lagarde (FT) Mar 11, 2019
IMF chief argues rise of highly profitable digital businesses makes rethink urgent.

Accounting is now the opposite of useful for users
Jonathan Ford (FT) Mar 11, 2019
GAAP earnings in recent years have seen a big divergence from national statistics.

Emerging markets in a ‘Goldilocks’ environment
Robin Wigglesworth (FT) Mar 11, 2019
There is plenty of money to be made but it is a delicate balancing act

Don’t be seduced by emerging market bulls or bears
Mohamed El-Erian (FT) Mar 11, 2019
When both viewpoints have a strong argument, being selective is key.

US, China and the return of a two-bloc world
Gideon Rachman (FT) Mar 11, 2019
Technology, not military power, will be the basis for this new global split.

A Currency Deal with China?
C. Fred Bergsten (PIIE) Mar 11, 2019
While running for president in 2016, Donald Trump pledged that “on day one of a Trump Administration the US Treasury Department will designate China a currency manipulator.” As recently as August 2018, the president tweeted that China’s practices were hurting US interests: “I think China’s manipulating their currency, absolutely.” It is thus highly ironic (to put it mildly) that he may now be asking China to manipulate its exchange rate to help the United States.

Trump’s Worst Economic Idea
Bloomberg View Mar 11, 2019
Tariffs on cars and parts would cause great damage and do no good. Congress should intervene.

Don’t Underestimate China’s Low-Inflation Headache
Daniel Moss (Bloomberg View) Mar 11, 2019
Price gauges are retreating, as they are in many economies. It’s a challenge with global dimensions.

Democracy vs. Disinformation
Ana Palacio (Project Syndicate) Mar 11, 2019
Efforts to combat disinformation in the West have so far focused on tactical approaches that target the "supply side" of the problem. To succeed, they must be accompanied by efforts that tackle the demand side of the problem: the factors that make liberal democratic societies today so susceptible to manipulation.

The Case for a Bold Economics
Dani Rodrik (Project Syndicate) Mar 11, 2019
Although economists are well positioned to imagine new institutional arrangements, their habit of thinking at the margin and sticking close to the evidence at hand encourages an aversion to radical change. But, when presented with new challenges, economists must envision new solutions – as a new group is determined to do.

Market Concentration Is Threatening the US Economy
Joseph E. Stiglitz (Project Syndicate) Mar 11, 2019
Rising inequality and slow growth are widely recognized as key factors behind the spread of public discontent in advanced economies, particularly in the United States. But these problems are themselves symptoms of an underlying malady that the US political system may be unable to address.

The Challenge of Monetary Independence
Andrés Velasco (Project Syndicate) Mar 11, 2019
By shadowing the US Federal Reserve so closely, Latin American countries are foregoing the policy flexibility that their floating exchange-rate regimes are intended to allow. They also risk relying too heavily on possible US interest-rate cuts to boost their economies, and not enough on deeper, long-term reforms.

Bank networks and systemic risk in the Great Depression
Sanjiv Das, Kris Mitchener and Angela Vossmeyer (VoxEU) Mar 11, 2019
The Global Crisis brought attention to how connections among financial institutions may make systems more prone to crises. Turning to a major financial crisis from the past, this column uses data from the Great Depression to study risk in the commercial banking network leading up to the crisis and how the network structure influenced the outcomes. It demonstrates that when the distribution of risk is more concentrated at the top of the system, as it was in 1929, fragility and the propensity for risk to spread increases.

Household credit cycles and financial crises
Jan Hannes Lang and Peter Welz (VoxEU) Mar 11, 2019
Financial crises are often preceded by credit excesses, but how do we know when credit is excessive? This column shows that deviations of household credit from levels that are justified by economic fundamentals exhibit long cycles of 15 to 25 years with large amplitudes of around 20%. Household credit excesses build up many years ahead of financial crises and only gradually unwind thereafter. Most importantly, higher levels of household credit imbalances are associated with larger declines in real GDP once a financial crisis hits. The findings suggest that household credit cycles should be carefully monitored by macroprudential policymakers to ensure financial stability.

Opportunity costs: can carbon taxing become a positive-sum game?
John Quiggin (Aeon) Mar 11, 2019
Decades ago, economists developed solutions – or variants on the same solution – to the problem of pollution, the key being the imposition of a price on the generation of pollutants such as carbon dioxide (CO2). The idea was to make visible, and accountable, the true environmental costs of any production process.

What’s Causing China’s Economic Slowdown
Christopher Balding (FA) Mar 11, 2019
And how Beijing will respond.

The Evolution of the Strongman
Erica Frantz (FP) Mar 11, 2019
Ironically, democracies that once seemed safe have slipped, and today’s authoritarian regimes have grown more liberal—at least in terms of their facades.

Monetary policy has run its course
Martin Wolf (FT) Mar 12, 2019
It has made secular stagnation worse. Fiscal alternatives look a safer bet.

Would rising populism be so bad for investors in Europe?
John Redwood (FT) Mar 12, 2019
The eurozone is under siege from parties seeking a change to the current fiscal rules.

EMs face a new debt crisis; Chinese lending is not the only cause
Paul Callan, Bassem Bendary and Yohann Sequeira (FT) Mar 12, 2019
Borrowers and lenders must act now to bring loans under control.

Why ‘Japanification’ looms for the sluggish eurozone
John Plender (FT) Mar 12, 2019
Low growth and inflation and ample central bank liquidity recall post-bubble Japan.

Do not expect rating agencies to dock the US
Moritz Kraemer (FT) Mar 12, 2019
S&P and Co are maintaining stable outlooks despite shutdowns and widening deficit.

Risks remain high in Argentina
Colby Smith (FT) Mar 12, 2019
But the country is equipped to muddle through.

Gaming the US-China deal
David Goldman (AT) Mar 12, 2019
US chipmakers rally on trade speculation; volatility in China explained by rising market leverage

Greece: Economy Improves, Key Reforms Still Needed
IMF Mar 12, 2019
Greece has now entered a period of economic growth that puts it among the top performers in the eurozone. It must now persevere with efforts to address crisis legacies and pursue needed reforms to ensure continued success, says the IMF in its recent assessment of the country’s economy.

Are stress tests fit for purpose?
Brian Caplen (Banker) Mar 12, 2019
The next crisis will have different causes from the last one. Banks need to look beyond stress tests in their risk management.

Brexit Vote Trilogy: Predictions and Observations
Kallum Pickering (Globalist) Mar 12, 2019
A surprise outcome in the key votes in the UK parliament this week is unlikely.

Brexit Has Failed, and Only a New Vote Can Fix It
Bloomberg View Mar 12, 2019
Theresa May’s deal is a dud. Parliament should vote it down and move on.

What China's $30 Trillion Credit Pile Doesn’t Tell You
Anjani Trivedi (Bloomberg View) Mar 12, 2019
Monthly data align poorly with business activity. For a better gauge of where things are headed, keep an eye on borrowing cycles.

What Venezuela Needs
Mohamed Aly El-Erian (Bloomberg View) Mar 12, 2019
International coordination of the nation’s debts will be essential so the humanitarian crisis can be addressed.

There’s No Sugarcoating Corporate Debt
John Authers (Bloomberg View) Mar 12, 2019
It looks like borrowers are gaming the ratings firms, and not for the first time. Also, Brexit follies and literary winners.

Duterte Feels Lucky. Inflation May Make His Day
Daniel Moss (Bloomberg View) Mar 12, 2019
Like Modi in India, the Philippine leader bucked orthodoxy with his choice of a central bank head. Both are fortunate that conditions favor monetary easing.

How Europe Can Trade with Iran and Avoid US Sanctions
Barry Eichengreen (Project Syndicate) Mar 12, 2019
Since President Donald Trump withdrew the United States from the 2015 Iran nuclear deal, European firms and banks have risked incurring US sanctions if they do business with the Islamic Republic. Fortunately for European leaders, who are eager to engage with Iran to keep the deal alive, a solution can be found in Europe's recent past.

Historically, GDP Growth has been Higher than the Interest Rate
Olivier Blanchard (PIIE) Mar 12, 2019
In his presidential address entitled “Public Debt and Low Interest Rates” at the annual American Economic Association, Olivier Blanchard said that public debt was not as inherently undesirable as many analysts say. In the current era of low interest rates, when GDP growth rates are higher than the interest rate on safe assets, limited deficits and debt may allow governments to expand investment and improve social welfare without producing an undue fiscal burden. This chart shows that for the United States, nominal GDP growth at a rate higher than the interest rate on risk-free assets has been the norm.

Bridging the Divide between Developed and Developing Countries in WTO Negotiations
Anabel González (PIIE) Mar 12, 2019
The Trump administration, in another sign of its tough approach to trade, moved in March to exclude India and Turkey from a program that has long granted the two countries preferential duty-free access to US markets. India, said the president, was being punished for failing to provide “equitable and reasonable access” to its markets for US goods. The administration’s action came after Brazil and Australia lodged parallel claims that India’s sugar subsidy regime has depressed world prices. Earlier this year, the World Trade Organization (WTO) took a similar step, ruling against China’s rice and wheat subsidies.

In US-China Trade Disputes, the WTO Usually Sides with the United States
Jeffrey J. Schott and Euijin Jung (PIIE) Mar 12, 2019
Trade wars are not as easy to win as President Donald Trump thought. But the United States generally wins trade disputes, particularly against China, when the case is brought to the World Trade Organization (WTO). This conclusion from the data is at odds with what Trump has asserted in his threats to pull the United States out of the WTO. In 2018, he declared that the WTO was set up "to benefit everybody but us" and added: "We lose the lawsuits, almost all of the lawsuits in the WTO."

British Politics Enters the Meltdown Phase
Therese Raphael (Bloomberg View) Mar 12, 2019
Theresa May's Brexit deal is dead. Now what?

Three Buzzwords Point to a China Stocks Boom
Shuli Ren (Bloomberg View) Mar 12, 2019
Supply-side reform is back. This time, Beijing’s bureaucratic catchphrase is code for fewer bank loans and more equity and bond sales.

How to Lose Friends and Impoverish People
Anne O. Krueger (Project Syndicate) Mar 12, 2019
In his single-minded quest to reduce US bilateral deficits with key trading partners, President Donald Trump has adopted a strategy that promises to make America's economic "adversaries" even more competitive in the future. Worse, he is alienating America's friends just when it needs them most.

ECB after Draghi: ‘You need an actor who can act fast’
Claire Jones (FT) Mar 13, 2019
Mario Draghi used bold policies to rescue the eurozone, but will his successor have the firepower to deal with any global slowdown?

Italy Inc needs Rome to stay on the rails
Ben Hall (FT) Mar 13, 2019
Coalition partners’ disjointed attitude to infrastructure projects cannot be sustained.

The Fed Is a Threat to Growth
Stephen Moore and Louis Woodhill (WSJ) Mar 15, 2019
The real economy is ready to reignite, but Powell’s tight-money policy is acting like a wet blanket.

Cities Are Engaged in a Global Competition. How Do the Best Keep Winning?
Slagin Parakatil (Brink) Mar 13, 2019
Today’s cities are engaged in a global competition, and many cities that were once relegated to the shadows of the world’s well-established urban centers are charting a new course. But what are the actual qualities of an attractive city—one that draws global talent and investment and ensures sustainable growth?

Brexit Mess: The EU Angle
Holger Schmieding (Globalist) Mar 13, 2019
A short eight-week delay to adjust the joint statement on post-Brexit relations accordingly would be fine for the EU27.

Asset Managers Lead Britain’s Brexit Exodus
Mark Gilbert (Bloomberg View) Mar 13, 2019
Having prepared for Brexit, U.K. fund managers will want to squeeze an advantage from their sunk costs.

For Its Own Sake, the EU Should Do More For the Arab World
Amr Ismail Ahmed Adly (Bloomberg View) Mar 13, 2019
European concerns about security and migration can best be addressed through better economic partnership.

Traders Make a Dangerous Bet on Brexit
Lionel Laurent (Bloomberg View) Mar 13, 2019
The pound rose on Wednesday despite Theresa May’s second crushing defeat. There’s a huge amount of wishful thinking in the markets.

Unilateral Free Trade Won’t Save the U.K.
Leonid Bershidsky (Bloomberg View) Mar 13, 2019
Non-tariff barriers mean there will be no return to the free trade of the 19th century.

Not Even Rothschild Can Buck the Swiss Gloom
Elisa Martinuzzi (Bloomberg View) Mar 13, 2019
Life for the country’s private bankers is getting harder, even for old money.

The Spell That Made China’s Debt Vanish Is Broken
Shuli Ren (Bloomberg View) Mar 13, 2019
Beijing is now classifying perpetual bonds as liabilities, not equity. That means borrowers’ balance sheets could look a lot more precarious.

What’s Wrong with Contemporary Capitalism?
Angus Deaton (Project Syndicate) Mar 13, 2019
Behind today's populist upheavals is a widespread recognition that the economy no longer serves the public good, or even the interests of most of its participants. To understand why, one must identify what has been lost amid so much material technological gain.

Bringing Poland Back to Europe
Grzegorz Schetyna (Project Syndicate) Mar 13, 2019
Thirty years ago, Poles overcame their internal divisions and resoundingly rejected communism and subservience to the Soviet Union. Today, confronted by a divisive populist government, they must remain as united in the cause of democracy and the rule of law as they were in 1989.

Optimising Production: Industrial Policies in Networks
Ernest Liu (VoxChina) Mar 13, 2019
Many developing countries adopt industrial policies favoring upstream sectors. Liu (2018) shows these policies might enhance aggregate production efficiency. When sectors form a production network, market imperfections generate distortions that compound through input demand linkages, accumulating into upstream sectors and creating an incentive for well-meaning governments to subsidize these sectors. The study proposes the measure “distortion centrality,” which is a sufficient statistic that can guide policy interventions in arbitrary networks. Distortion centrality predicts sectors that were promoted in South Korea in the 1970s and modern-day China, suggesting that these policies might have generated positive aggregate effects.

What’s wrong with the WTO’s Environmental Goods Agreement
Jaime de Melo and Jean-Marc Solleder (VoxEU) Mar 13, 2019
Developing countries have not participated in the WTO-led negotiations aimed at bringing down barriers to trade in environmental goods. If negotiations conclude, would the win for trade and for the environment be extended to a win for developing countries? This column draws insights from a newly assembled comprehensive dataset on barriers to trade in environmental goods and provides evidence that tariffs and non-tariff barriers are still an impediment to trade while similar regulations stimulate it. A larger list of environmental goods would entice developing-country participation, but this will also require protecting developing countries from challenges at the WTO.

Revisiting the efficacy of the ECB’s balance sheet policies
Adam Elbourne, Kan Ji and Bert Smid (VoxEU) Mar 13, 2019
Previous research has shown that changes to the size of the ECB’s balance sheet were followed by meaningful changes in macroeconomic aggregates. This column argues that the econometric technique these studies employed does not provide reliable estimates. Impulse responses to purported balance sheet shocks are statistically indistinguishable from those from nonsensical identification schemes. The effectiveness of the ECB’s balance sheet policies is therefore still unproven.

India is Trump’s Next Target in the Trade War
Arvind Panagariya (FP) Mar 13, 2019
Ending India’s preferential trade relationship with the United States is politically dangerous.

Two Big Brexit Myths Are Slayed at Last
Therese Raphael (Bloomberg View) Mar 13, 2019
British lawmakers have decisively rejected a no-deal Brexit. They just need to decide what they want instead.

Trump’s Big Trade Opening
Robert Porter (WSJ) Mar 14, 2019
The impending deal with China is a chance for America to lead a new era of liberalization.

Brexit will mark the end of Britain’s role as a great power
Fareed Zakaria (WP) Mar 14, 2019
If the deal goes through, Britain, Europe and the United States would lose big.

China may soon run its first annual current-account deficit in decades
Economist Mar 14, 2019
China is switching from being a net lender to the world to being a net borrower. The implications will be profound.

Oh **UK! What next for Brexit?
Economist Mar 14, 2019
Britain’s political crisis has reached new depths. Parliament must seize the initiative.

Brexit: Will It Ever Happen?
Denis MacShane (Globalist) Mar 14, 2019
EU countries are wary to allow for yet more time wasting by futile Brexit discussions occupying the EU agenda just because British politicians are incapable of making up their minds.

Trump Is Actually Making the Trade Deficit Bigger
Justin Fox (Bloomberg View) Mar 14, 2019
If you don’t understand what causes the trade deficit, you can’t fix it.

Don’t Let a China Trade Deal Kill the U.S. Campaign Against Huawei
Eli Lake (Bloomberg View) Mar 14, 2019
The U.S. shouldn’t be so desperate for an agreement that it gives China a worldwide advantage in surveillance.

Why Japan’s Massive Stimulus Still Isn’t Enough
Daniel Moss (Bloomberg View) Mar 14, 2019
The central bank prints lots of money. With doves ascendant around the globe, more might be needed.

Britain’s Next Great Brexit Mistake
Clive Crook (Bloomberg View) Mar 14, 2019
A short delay before the U.K. leaves the European Union won’t work. Brexit should be canceled altogether.

Hammond offers a carrot for a Brexit compromise
FT View Mar 14, 2019
Chancellor warns UK’s economic progress is imperilled by a no-deal exit.

Nigeria ‘needs structural reform’ to escape low-growth trap
Steve Johnson (FT) Mar 14, 2019
Call for investment, energy shake-up and education push to stop GDP per head sliding.

Driven to default: what’s causing the rise in subprime auto loans?
Gillian Tett (FT) Mar 14, 2019
US default rates have risen fastest among borrowers under the age of 30.

Europe must learn to love fiscal stimulus
Reza Moghadam (FT) Mar 14, 2019
Most countries can support economic growth without jeopardising debt sustainability.

May could be losing her way to Brexit victory
Sebastian Payne (FT) Mar 14, 2019
Latest Commons defeat may be what helps prime minister pass her deal.

Oil sanctions bolster bets that crude prices will rise
David Sheppard (FT) Mar 14, 2019
In the short term there may not be as much slack in the oil market as the US believes.

Greece maps the long way back to a Brexit deal
Philip Stephens (FT) Mar 14, 2019
Kamikaze Leavers who have wrecked Theresa May’s deal cannot win support for their own.

The High Costs of the New Cold War
Minxin Pei (Project Syndicate) Mar 14, 2019
The new cold war against China will be won not through ideology or even weaponry, but through economic pressure, and the winning strategy will not be one that weaponizes only America’s greed. In this sense, by nickel-and-diming its allies, the US is effectively disarming itself.

The Dangerous Absurdity of America’s Trade Wars
Jeffrey D. Sachs (Project Syndicate) Mar 14, 2019
US President Donald Trump’s trade policies not only seek to improve America’s external balance, but also represent a misguided attempt to contain China and even to weaken Europe. Seen in this context, Trump’s misconceived trade wars are nearly as predictable as the macroeconomic imbalances they have so spectacularly failed to address.

Tax-Cut Time for Germany?
Clemens Fuest (Project Syndicate) Mar 14, 2019
The country's tax burden has been increasing for years, and economic growth is slowing. Tax cuts would help to keep investment and jobs in Germany, and would force its politicians to reexamine existing government expenditure rather than automatically increasing it.

The geopolitics of bilateral trade agreements
Barry Eichengreen, Arnaud Mehl and Livia Chitu (VoxEU) Mar 14, 2019
Both economics and geopolitics matter for trade agreements. In particular, defence pacts raise the probability of a trade agreement between a pair of countries by as much as 20 percentage points. This column estimates that were the US to alienate its geopolitical allies, the likelihood and benefits of successful bilateral agreements would diminish significantly. Expected trade creation from an agreement between the US and EU countries would decline by 0.6% of total US exports.

Vietnam – Globalized Party-State
Börje Ljunggren (YaleGlobal) Mar 14, 2019
The nation takes an unorthodox path to a market economy, but may need to move beyond the party-state for full potential.

China’s Provinces Can’t Afford Beijing’s Development Plans
Edoardo Campanella (FP) Mar 14, 2019
Rising local debt is making the Chinese economy even more fragile.

Ghana currency plunge recalls Argentina fears
Steve Johnson (FT) Mar 15, 2019
Surprise rate cut blamed for this year’s worst forex sell-off.

Global debt —when is the day of reckoning?
Laurence Fletcher (FT) Mar 15, 2019
Central banks and companies still have ways of kicking the can down the road.

Japan’s imperial transition puts yen flash crash on the radar
Leo Lewis (FT) Mar 15, 2019
‘Golden Week’ holidays will shut equity and bond markets for 10 consecutive days.

Brexit delay but May is still fighting for her deal
Robert Shrimsley (FT) Mar 15, 2019
Battered by events she may be, but the prime minister has bought herself more time.

Politics is failing on Brexit, not economics
Chris Giles (FT) Mar 15, 2019
The first years of this saga has proved the case for listening to experts.

Liquidity is the scary absentee in stocks’ rebound
Robin Wigglesworth (FT) Mar 15, 2019
Bounce in equities has masked worries over the structure of the market.

Wile E Coyote and market volatility
David P. Goldman (AT) Mar 15, 2019
After two months doing nothing, US markets have a very heavy feel.

How Worrying Is the Recent Downgrading of German Growth Forecasts?
Álvaro Leandro and Jeromin Zettelmeyer (PIIE) Mar 15, 2019
Growth in Germany has been very weak since the third quarter of 2018. The reason is a combination of one-off factors, including a drought and a new EU emissions testing procedure, which held back car sales last year, as well as cooling demand for German exports. As a result, growth projections for 2019 have been steadily downgraded, contributing to a sense of gloom. But observers of the German economy should not worry too much about the recent downgrades in growth forecasts, because these do not, in fact, imply pessimism about the future. They merely reflect the slowdown that has already happened, not expectations that the slowdown will continue.

Trump’s Foreign Assistance Budget Request, in 3 Charts
Erin Collinson (CGD) Mar 15, 2019
President Trump’s FY2020 budget request landed with a thud on Capitol Hill Monday. Once again, the administration is proposing deep cuts to the international affairs budget and, once again, members of Congress on both sides of the aisle have pledged to reject the proposed reductions in US development and diplomacy spending.

Establishing Credibility and Legitimacy: Seven Challenges for David Malpass
Masood Ahmed (CGD) Mar 15, 2019
All incoming World Bank presidents bring a public record of their views about the bank and about development more generally. David Malpass, who is on track to become the bank’s next president, has not been shy in criticizing the role and management of the institution he now leads. The commentary on his nomination has detailed how his vision of the World Bank’s role and his reservations about multilateral solutions to global development challenges are at odds with the views of the bank’s shareholders and staff and—most importantly—with the needs of its clients, developing countries.

China’s Debt Is Still Piling Up—And the Pileup Is Getting Faster
Alicia García-Herrero (Brink) Mar 15, 2019
If you think China’s monetary policy became more lax in 2018, wait for 2019. Pushed by gloomier activity data, China’s policymakers have moved from an orthodox monetary policy to a much more heterodox one. An assessment of how leveraged China really is, and which sectors of the economy are the most indebted. Learn more »

Theresa May Might Have Outmaneuvered All Her Brexit Critics
Mohamed Aly El-Erian (Bloomberg View) Mar 15, 2019
In the end, timing is everything: EU elections this spring play into the prime minister’s plans.

Fighting Climate Change Won’t Be Painless
Mark Buchanan (Bloomberg View) Mar 15, 2019
Ensuring a sustainable future for humanity will require some setbacks before real progress is made.

Why the U.S. Trade Deficit Keeps Growing
William C Dudley (Bloomberg View) Mar 15, 2019
Trump’s fiscal policy is undermining his trade agenda.

The U.S. Is That Awful Country That Everyone Wants to Move To
Justin Fox (Bloomberg View) Mar 15, 2019
If the quality of life is better in Canada and Europe, why don’t more Americans emigrate?

The AI Governance Challenge
Alissa Amico (Project Syndicate) Mar 15, 2019
Masayoshi Son, CEO of the Japanese multinational conglomerate SoftBank and an enthusiastic investor in AI, recently said that his company seeks “to develop affectionate robots that can make people smile.” But if AI is truly to make people happier, let alone make society as a whole better off, we have to get the rules and standards right.

The Fed Should Buy Recession Insurance
J. Bradford DeLong (Project Syndicate) Mar 15, 2019
If the United States falls into recession in the next year or two, the US Federal Reserve may have very little room to loosen policy, yet it is not taking any steps to cover that risk. Unless the Fed rectifies this soon, the US – and the world – may well face much bigger problems later.

Modern Monetary Realism
James K. Galbraith (Project Syndicate) Mar 15, 2019
Kenneth Rogoff's criticism of Modern Monetary Theory assumes that MMT advocates don't care about budget deficits or the independence of the US Federal Reserve. But these assumptions are wide of the mark, and Rogoff himself sometimes undermines his own arguments.

What Europe’s Populist Right Is Getting Right
Mitchell A. Orenstein (Project Syndicate) Mar 15, 2019
Authoritarian nationalists such as Hungarian Prime Minister Viktor Orbán win support not only by attacking immigrants, but also by delivering economic policies that benefit the poor and middle class. Western analysts and, more important, Western leaders need to learn this lesson before it's too late.

Selling China Short
Stephen S. Roach (Project Syndicate) Mar 15, 2019
The flow of doom-mongering books about China has lately become more like a tidal wave. Whatever their strengths, recent contributions also tell a compelling – and seemingly timeless – story about how Western observers’ assumptions shape their conclusions, leaving one to wonder how China ever got to where it is today.

Failing banks and Hitler's path to power
Sebastian Doerr, José-Luis Peydró and Hans-Joachim Voth (VoxEU) Mar 15, 2019
Polarised politics in the wake of financial crises echo throughout modern history, but evidence of a causal link between economic downturns and populism is limited. This column shows that financial crisis-induced misery boosted far right-wing voting in interwar Germany. In towns and cities where many firms were exposed to failing banks, Nazi votes surged. In particular, places exposed to the one bank led by a Jewish chairman registered particularly strong increases of support – scapegoating Jews was easier with seemingly damning evidence of their negative influence.

Emerging Markets Aren’t Out of the Woods Yet
Agustín Carstens and Hyun Song Shin (FA) Mar 15, 2019
How they can manage the risks.

U.S. Debt: Is It the Calm Before the Storm?
K@W Mar 15, 2019
The U.S. national debt has crossed $22 trillion---the highest ever. Addressing the problem now, rather than delaying the inevitable, would be the best approach to keeping the economy strong, experts say.

Is Cryptocurrency Really a New Idea?
William N. Goetzmann (Yale Insights) Mar 15, 2019
Bitcoin meshes digital technology with an approach to money that predates the development of cash and coin. The cryptocurrency craze offers a glimpse of the social meaning of money and the difficulties of innovating on an effective system.

No Exit
Lionel Shriver (Harper's) Mar 15, 2019
As I’ve watched Brexit grind on, what seems increasingly at stake is whether democracy pays off.

Why US equities may yet have the last laugh
Michael Mackenzie (FT) Mar 16, 2019
Although the S&P 500 looks expensive versus rivals, it has plenty running in its favour.

Thai Growth Will Ride Out Any Election Unrest
Ronald W Chan (Bloomberg View) Mar 16, 2019
Once the dust settles, attention will return to completing a key economic project that’s already attracted billions of dollars in foreign investment.

A long Brexit delay spells danger for the EU
Wolfgang Münchau (FT) Mar 17, 2019
Extended UK divorce will suck up union’s resources and distract it from more pressing business.

America’s new housing bubble
Rana Foroohar (FT) Mar 17, 2019
Loose monetary policy has buoyed assets but did not create meaningful supply.

Quit Worrying and Learn To Love Trade With China
Deirdre Nansen McCloskey (Reason) Mar 17, 2019
Get ready for the Great Trump-Xi Depression.

Burden-sharing a remedy for falling birth rates in East Asia
Mary Brinton (EAF) Mar 17, 2019
Japan was the first in the region to experience birth rates below population-replacement level, dipping below two children per woman in the late 1970s.

China’s Banks Have a Hidden Wave of Bad Debt
Christopher Balding (Bloomberg View) Mar 17, 2019
Factor in the amount of soured loans they stripped from their balance sheets last year, and the situation looks a lot more troubling.

Algeria's Not Alone -- OPEC's Ailing Brothers Are Under Serious Threat
Julian Lee (Bloomberg View) Mar 17, 2019
Meet "The Shaky Six," a band of OPEC's ailing brothers whose oil output is at risk of falling.

Central bank digital currencies and private banks
David Andolfatto (VoxEU) Mar 17, 2019
The idea of a central bank digital currency has prompted a mixed reaction among economists. This column uses a simple theoretical framework to investigate the impact of such a currency on a monopolistic banking sector. There are two main results. First, the introduction of an interest-bearing digital currency increases financial inclusion, diminishing the demand for physical cash. Second, while an interest-bearing digital currency reduces monopoly profit, it need not disintermediate banks in any way. A central bank digital currency may, in fact, lead to an expansion of bank deposits if the resulting competition compels banks to raise their deposit rates.

MPs must act in national interest to resolve Brexit
FT View Mar 18, 2019
Parliament should use a delay to find where a majority lies for an exit option.

Transition to renewables demands investment
Nick Butler (FT) Mar 18, 2019
Norway’s sovereign wealth fund is misguided in cutting its oil and gas holdings.

Minimum-volatility funds have had their time in the sun
Robin Wigglesworth (FT) Mar 18, 2019
The risk is that a strong performance so far this year will start to fade.

Why Macron should have mercy on May over Brexit
Gideon Rachman (FT) Mar 18, 2019
A rapid withdrawal by the UK would only strengthen the EU’s enemies.

Wall Street’s Latest Love Affair With Risky Repackaged Debt
William D. Cohan (NYT) Mar 18, 2019
Investors in collateralized loan obligations are ignoring the signs of danger.

Limiting Too Big to Fail
WSJ Mar 18, 2019
The feds narrow the rules for naming firms ‘systemically important.

How Are Those Steel Tariffs Working?
WSJ Mar 18, 2019
Let’s look at the evidence a year later in jobs and trade flows.

The quest for Brexit has killed Britain
Nick Cohen (WP) Mar 18, 2019
No compromise, no opposition — and above all, no common sense.

Deflation Fears Drive Developing Countries to Even Lower Interest Rates
George Pickering (Mises Wire) Mar 18, 2019
While the US's central bank strikes a "cautiously optimistic" stance (as usual), central banks in developing countries are driven to easy money by economic uncertainty and a weakening dollar.

Africa Will Bear the Brunt of Climate Change. Will Economic Growth Reverse the Trend?
John Asafu-Adjaye (Brink) Mar 18, 2019
Although Africa has contributed the least to climate change, it is likely to bear the brunt of future global warming. What role can renewable energy, investment and governance play in mitigating the crisis?

Stop the Brexit Countdown and Think Again
Bloomberg View Mar 18, 2019
It isn’t too late for the U.K. to extricate itself from this mess.

India’s Central Bank Is Full of Surprises These Days
Andy Mukherjee (Bloomberg View) Mar 18, 2019
The latest rupee-dollar swap took markets off-guard. Ample theorizing has yielded little consensus about the impact.

Hero to Zero: Exports Turn to Source of Fragility in Asia
Daniel Moss (Bloomberg View) Mar 18, 2019
A decades-old model needs reappraisal as the global downdraft causes trade-reliant economies to reel.

Italy Can’t Keep Both China and Donald Trump Happy
Ferdinando Giugliano (Bloomberg View) Mar 18, 2019
Rome is split over joining Xi Jinping's Belt and Road plan. The populists are finding out how hard it is play both sides in a geopolitical struggle.

A Recession Is Coming, And Maybe a Bear Market, Too
Gary Shilling (Bloomberg View) Mar 18, 2019
History shows that equities normally drop about 21 percent when the economy contracts.

Think Local, Develop Better
Zara Kayani (Project Syndicate) Mar 18, 2019
The development debate in Pakistan has moved on considerably in the past 30 years, and local communities are playing an increasingly important role. Their involvement should be welcomed and encouraged, because it is vital for ensuring the acceptability and sustainability of development initiatives.

No Choice and No Exit for the UK
Robert Skidelsky (Project Syndicate) Mar 18, 2019
The outcome of the simple binary choice given to UK voters in the June 2016 Brexit referendum has proved almost impossible to implement. The main obstacle is not the complications of negotiating new treaties, but rather the judgment by those in charge of Britain’s political life that the costs of an emphatic withdrawal are too great.

Bretton Woods at 75
Arminio Fraga (Project Syndicate) Mar 19, 2019
The framework of multilateral economic cooperation established in 1944 is under serious strain, if not broken. Nevertheless, the Bretton Woods institutions, together with more recently established international and regional forums, still have a meaningful long-term role to play in global economic governance.

Understanding the Fed’s Dovish Turn
Nouriel Roubini (Project Syndicate) Mar 18, 2019
Over the past few years, the US Federal Reserve has been ahead of other major central banks in normalizing monetary policy. But now the Fed has abruptly put further interest-rate hikes on hold, owing to key changes in macroeconomic conditions and the political environment.

Brexit delay will not postpone deglobalisation
Peter A.G. van Bergeijk (VoxEU) Mar 18, 2019
Many associate Brexit and the Trumpian trade wars with the start of a new phase of deglobalisation. This column argues that we should view them as symptoms rather than causes, as the world had already started to fundamentally change before either came on the horizon. Neither the delay to Brexit nor the extended pause in the US–China tariff war means that the risks of deglobalisation have diminished.

Learning from Brexit
Oonagh Fitzgerald (CIGI) Mar 18, 2019
Those of us watching Brexit from outside the United Kingdom should learn lessons about the fragility of the international legal order, the trickiness of managing referenda and parliamentary democracy’s failings when pushed to its limits.

China’s appetite for US assets imperilled at worst time
Bill Campbell (FT) Mar 19, 2019
A shrinking Chinese current account surplus poses problems for US public and private sectors.

China needs to overhaul its financial sector
Liu Jun (FT) Mar 19, 2019
Companies in burgeoning technology require new sources of funding.

Is the equity bull market too big to fail?
Joseph Carson (FT) Mar 19, 2019
Private sector’s growing reliance on stocks means a crash could substantially damage the economy.

Brexit, Bercow and the constitution
David Allen Green (FT) Mar 19, 2019
How Britain has avoided a crisis, not been gripped by one.

Why further financial crises are inevitable
Martin Wolf (FT) Mar 19, 2019
As time passes, regulation degrades and risks rise.

Turkey: Erdogan’s struggle to lift flagging business
Laura Pitel (FT) Mar 19, 2019
The country is in recession, but with banks loath to lend and bankruptcies on the rise the president has few options.

Europe’s China Dilemma
WSJ Mar 19, 2019
The Continent shows a new realism as Xi seeks to divide and dominate.

To Understand China, Look to America’s History
Katherine C. Epstein (WSJ) Mar 19, 2019
In challenging Britain’s hegemony a century ago, U.S. tactics look similar to Beijing’s today.

Hong Kong’s dollar stability is getting trumped
William Pesek (AT) Mar 19, 2019
If ever there were a time to brainstorm about a new way forward, it’s now.

Italy’s courting of China has operatic undertones
Gordon Watts (AT) Mar 19, 2019
Despite the thunderous background music from the EU and the US, Rome sees economic advantages in BRI deal.

What if the middle class gets poorer?
Brian Caplen (Banker) Mar 19, 2019
Banks could find that the bulk of their client base faces declining living standards and financial hardship. They should start preparing now.

Navigating Uncertainty in Inflation Markets: The UK Case
Lorenzo Pagani (PIMCO) Mar 19, 2019
Investors in UK inflation-linked bonds are facing two critical sources of structural uncertainty: Brexit-induced volatility and questions about the deeply entrenched (yet problematic) Retail Price Index (RPI).

Quants in the Muni Market Show Bond Liquidity Will Be Fine
Brian Chappatta (Bloomberg View) Mar 19, 2019
Debt markets continue to evolve in an era of diminished Wall Street influence.

The Models Are Going to Be in Charge
Barry L Ritholtz (Bloomberg View) Mar 19, 2019
Humans and machines aren’t alternatives; they’re complementary.

When the Evidence Is Solid and the Returns Aren’t
Nir Kaissar (Bloomberg View) Mar 19, 2019
The numbers said other strategies should have beaten growth stocks after the financial crisis. They didn’t (so far).

Australia Is Being Dragged Toward an Interest-Rate Cut
Daniel Moss (Bloomberg View) Mar 19, 2019
The RBA is officially agnostic on its next move, but the main scenario might need a nudge.

Showing Europe’s True Colors
Romano Prodi and Stefano Micossi (Project Syndicate) Mar 19, 2019
In the face of the challenge posed by nationalists and populists ahead of the European Parliament elections in May, standing up for Europe’s fundamental values has never been more important. Flying the EU flag from our homes and offices can send an undeniable signal that the Union will not be hollowed out by its enemies, within or without.

Stagnant Capitalism
Yanis Varoufakis (Project Syndicate) Mar 19, 2019
A decade after the 2008 financial crisis, faith in markets' self-regulating abilities once again lies in tatters. There simply is no single real interest rate that would spur investors to funnel all existing savings into productive investments, and employers to hire all who wish to work at the prevailing wage.

For Somaliland and Djibouti, Will New Friends Bring Benefits?
Matt Kennard and and Ismail Einashe (FP) Mar 19, 2019
The breakaway territory of Somaliland is hoping that international investment will bring international recognition, but outside influence always comes with risks.

Why Governments Count People
Joseph Chamie (YaleGlobal) Mar 19, 2019
Accurate censuses help with government planning – an odd question or unrepresentative sample can erode results.

Yukon Huang on China's Foreign Investment Law and US-China Trade Friction
Shannon Tiezzi (Diplomat) Mar 19, 2019
Huang discusses the prospects for continued economic reform in China and the outlook for a US-China trade deal.

The EU should be ready to grant a long Brexit delay
FT View Mar 20, 2019
Principle of Commons speaker John Bercow’s intervention was correct.

Transatlantic front opens in Brexit derivatives battle
Gillian Tett (FT) Mar 20, 2019
Britain is caught in the middle of a regulatory tussle between the US and the EU.

We ignore the index providers’ power at our peril
John Plender (FT) Mar 20, 2019
Their growing muscle, and the fact it is unregulated, is increasingly a worry.

India is well placed to be a global economic force
Gaurav Dalmia (FT) Mar 20, 2019
Beyond the election, the issues of jobs and institutions will require unrelenting focus.

Whatever happened to the EM rally?
Jonathan Wheatley (FT) Mar 20, 2019
Strong positioning data suggest investors may have little appetite for more.

Condemned to Repeat the History of Bank Failures?
NYT Mar 20, 2019
The 2008 crisis showed what happens when financial regulation is weakened while the economy is strong. The Trump administration is doing it again.

The Debt Crisis Is Coming Soon
Martin Feldstein (WSJ) Mar 20, 2019
To avoid economic distress, the government has to reduce future entitlement spending.

Italy’s plan to join China’s Belt and Road Initiative ruffles feathers
Economist Mar 20, 2019
At home and abroad.

Gavi@20: What’s Next for Global Immunization Efforts
Amanda Glassman (CGD) Mar 20, 2019
The Board of Gavi, The Vaccine Alliance, will retreat next week to discuss a new strategy and replenishment. Ahead of its 20-year anniversary next year, the Board will reflect on key questions that will frame Gavi’s mandate, funding, and activities into the next five-year period. On the agenda: questions on Gavi’s role in addressing coverage gaps in immunization, how middle-income countries should be involved, and how the organization will shape vaccine markets and future innovation.

Why the Next ECB President Will Be from Germany—and Probably Jens Weidmann
Jacob Funk Kirkegaard (PIIE) Mar 20, 2019
On top of all their other problems, EU leaders face decisions by June on choosing the next heads of no less than four entities: the European Commission, European Central Bank (ECB), European Council, and European Parliament. The European Parliament to be elected in late May will have a say on these choices,[1] but the EU’s 27 leaders must agree to this “personnel package.”[2] Yet already the stars are lining up for a German to serve as the next president of the ECB, most likely Jens Weidmann, the president of Germany’s central bank, the Bundesbank.

Africa Has a $100 Billion Infrastructure Problem. What’s Missing?
Linus Mofor (Brink) Mar 20, 2019
Africa’s infrastructure is very much at risk from climate change. However, major investments to close the continent's infrastructure gap will have to come from the private sector. This presents a great opportunity for Africa.

Moral Hazard in Emerging Markets: Papering Over the Cracks
Francesc Balcells and Brian Holmes (PIMCO) Mar 20, 2019
With a patchwork of lenders now willing to provide financing on noncommercial terms to countries in distress, “moral hazard plays” have proliferated in emerging markets.

Neutral Rates, Neutral Balance Sheet
Tiffany Wilding (PIMCO) Mar 20, 2019
As widely expected, the Federal Reserve held interest rates steady at this week’s FOMC (Federal Open Market Committee) meeting, but other aspects of the meeting had notable implications for markets and investors.

What Europe Should Do About Brexit
Bloomberg View Mar 20, 2019
Grant Theresa May a delay — to rethink, not to strategize.

What to Expect When the Fed Is Expecting Inflation
Karl W Smith (Bloomberg View) Mar 20, 2019
It has been focused on keeping inflation low for decades. How can the central bank credibly change its approach?

The Stock and Bond Markets Can't Both Be Right
Komal S Sri-Kumar (Bloomberg View) Mar 20, 2019
History shows that fixed-income assets are a better barometer of the economic outlook.

The China Tech Bubble Is Dead. Long Live the China Tech Bubble
Nisha Gopalan (Bloomberg View) Mar 20, 2019
Offshore private equity funds struggled to compete with a wave of onshore money. Now it’s retreating, and the water looks more inviting.

Why the Fed Solidified Its Policy U-Turn
Mohamed Aly El-Erian (Bloomberg View) Mar 20, 2019
The central bank’s guidance on interest rates is more dovish than even the most sanguine bulls had hoped.

The Blind Spot in the Trade Debate
Laura Tyson and Susan Lund (Project Syndicate) Mar 20, 2019
In today’s world, digital flows and services are already too big and important to ignore. As governments assess their external balances and competitive positions, hammer out trade deals, and set national policy agendas, they need to look beyond manufacturing and agriculture.

Italy’s Risky Silk Road
Paola Subacchi (Project Syndicate) Mar 20, 2019
The Italian government is keen to join China’s "Belt and Road Initiative" and plans to sign an agreement to this effect during Chinese President Xi Jinping’s upcoming visit to Italy. But although deeper trade and investment ties with China could boost its sluggish economy, Italy should pursue them through the EU, not bilaterally.

Public versus private digital money: Macroeconomic (ir)relevance
Markus K Brunnermeier and Dirk Niepelt (VoxEU) Mar 20, 2019
Both proponents and opponents of central bank digital currency have suggested that it would fundamentally change the macroeconomy. This column questions this paradigm, arguing that the introduction of such a currency need not alter the allocation nor the price system. Concerns about central bank digital currency choking investment, cutting into banks’ profits, or increasing the likelihood of bank runs are misplaced.

China’s Rebalancing: Recent Progress, Prospects, and Policies
Rui C. Mano and Jiayi Zhang (VoxChina) Mar 20, 2019
While China’s growth gathered momentum in 2017, rebalancing was uneven and decelerated along many dimensions reflecting the temporary factors behind the growth pickup. Going forward, rebalancing is expected to proceed as these temporary factors recede, but elevated income inequality and leverage will remain a challenge. The authorities are already pursuing several pro-rebalancing policies which could be expanded to support each dimension of rebalancing while reducing trade-offs between them.

FOMC Thinks It Will Be on Hold Throughout 2019
Jay H. Bryson (WF) Mar 20, 2019
As widely expected, the FOMC kept rates on hold today, but it now thinks that it will not need to tighten any further this year.

Shifting Burdens of Household Debt
Tim Quinlan and Shannon Seery (WF) Mar 20, 2019
Household debt in the United States is higher now than it was at the height of the prior cycle. But, rather than seeing elevated household debt levels as an immediate catalyst for recession, we see a shift in the composition of debt that will likely weigh on consumer spending for years to come.

Growing payments firms may pose systemic risk
FT View Mar 21, 2019
Regulators must keep pace with the innovation in digital money.

May’s very big gamble risks no-deal Brexit
Robert Shrimsley (FT) Mar 21, 2019
If EU is not bluffing, and Commons cannot agree alternative, then the clock will run down.

New shipping rules leave oil traders strangely paralysed
David Sheppard (FT) Mar 21, 2019
IMO 2020 regulations promoting low-sulphur fuels throw up plenty of unknowns.

The EU’s enemy within: Eurosceptic Remainers
Simon Kuper (FT) Mar 21, 2019
As member states flout the rules, Brussels is like a weak schoolteacher losing control of the class.

Theresa May is taking a hideous Brexit gamble
Martin Wolf (FT) Mar 21, 2019
A bolder and more flexible leader would have stuck to the idea of a long extension.

Brexit advice to May from the quick and the dead
Henry Mance (FT) Mar 21, 2019
Leaders from across the world, past and present, give their thoughts on strategy.

Befuddled sterling shows markets aren’t all-knowing
Katie Martin (FT) Mar 21, 2019
The UK exchange rate is failing to reflect the risk of a disorderly Brexit.

Italy will secure its place on the new Silk Road
Michele Geraci (FT) Mar 21, 2019
Rome’s Belt and Road agreement with Beijing can be a model for other European countries.

What the EU should do next about Brexit
Wolfgang Münchau (FT) Mar 21, 2019
It is time for the other 27 member states to insist the UK make up its mind.

The last way out of the Brexit nightmare
Philip Stephens (FT) Mar 21, 2019
Britain’s MPs should revoke Article 50 and start again to build a national consensus.

Investors in credit are backing hammers that see only nails
Dan Zwirn (FT) Mar 21, 2019
The systematic underpricing of loans will inevitably blow holes in balance sheets.

The shift away from Libor could threaten stability
Megan Greene (FT) Mar 21, 2019
Investors should not be too sanguine about transition from scandal-linked rate.

The oligarchs are suffocating what’s left of democracy in Eastern Europe
Mikheil Saakashvili (WP) Mar 21, 2019
In Ukraine, Moldova and Georgia, the real rulers aren't always the elected ones.

Economic growth does not guarantee rising happiness
Economist Mar 21, 2019
An old paradox lives on.

China’s leaders should study James Bond films
Economist Mar 21, 2019
Revealing one’s master plan too early can be dangerous.

Central Banks Are Messing with Your Head
Thorsten Polleit (Mises Wire) Mar 21, 2019
By tinkering with interest rates, central banks tinker with the way human beings see the present and the future, and their value systems overall.

Ecuador's New Economic Plan Explained
IMF Mar 21, 2019
Ecuador has developed a new economic plan designed to put the country’s debt on a firm downward path, create jobs, protect the poor and most vulnerable, and bolster the fight against corruption.

The shadow of Brexit: Guessing the economic damage to the UK
Francesco Papadia (Bruegel) Mar 21, 2019
This post concludes that UK real income and investment would have been 4% and 6% larger respectively had it not been for the shock of the Brexit referendum result. With somewhat audacious assumptions, the damages already incurred can be scaled up to guess the negative macroeconomic consequence of each of the three possible Brexit outcomes: no-deal, deal or no Brexit.

Sticks and carrots from China’s leadership to Chinese banks
Alicia García Herrero and Gary Ng (Bruegel) Mar 21, 2019
The takeaway from the 13th National People's Congress (NPC) is clear: under the current economic downturn, Chinese authorities will do whatever it takes to support the real economy.

The Fed Is on Hold
Joseph E. Gagnon (PIIE) Mar 21, 2019
The Federal Open Market Committee (FOMC or Fed) left the target for the federal funds rate unchanged at a range of 2.25 to 2.50 percent, as was widely expected. The news in the March 2019 meeting came on two other fronts.

Africa’s Unsung “Industrial Revolution”
Bright Simons (CGD) Mar 21, 2019
There is an industrial revolution underway in sub-Saharan Africa’s most entrepreneurial economies—places such as Ghana, Uganda, Senegal, and Côte d’Ivoire. So far, it has failed to garner much attention, perhaps because it doesn’t fit the expected mould of large-scale structural transformation. But viewed through the kind of close-up ethnographic lens I describe in a recent CGD note, trends in these countries show that the growing engagement of smaller Chinese businesses is fuelling a new kind of industrialisation—what I call Alibaba industrialisation.

The Fed Has Given Up: Get Ready for More QE
Ryan McMaken (Mises Wire) Mar 21, 2019
The Fed has given up on "normalizing" monetary policy, and it's going to keep on with its ultra-low-interest-rate policy which has led to growing inequality while also failing to drive much growth.

Italy Enjoys a Rare Moment of Banking Bliss
Ferdinando Giugliano (Bloomberg View) Mar 21, 2019
EU judges have ruled there’s nothing illegal about Rome using deposit guarantee funds to rescue lenders. This is a Pyrrhic victory, to say the least

The Fed’s Gift to Asia Sits Unopened
Daniel Moss (Bloomberg View) Mar 21, 2019
The question isn’t whether or when the region’s central banks will seize the chance to combat a slowdown. Rather it’s why they haven’t done so already.

Toward a New Global Charter
Carl Bildt (Project Syndicate) Mar 21, 2019
Whereas the failure to forge a lasting world order at Versailles resulted in the catastrophe of World War II, the establishment of shared principles under the 1941 Atlantic Charter led to eight decades of prosperity and relative stability. With the world undergoing another geopolitical sea change, a new global charter is needed.

Italy’s BRI Blunder
Lucrezia Poggetti (Project Syndicate) Mar 21, 2019
Although Italy's governing parties are belatedly debating the wisdom of signing onto Chinese President Xi Jinping's Belt and Road Initiative, it is already too late for Italy to change course. Having spurned joint EU efforts to secure Europe's strategic sectors, Italy will soon find that it got a raw deal.

What’s Next for Kazakhstan?
Nargis Kassenova (Project Syndicate) Mar 21, 2019
The resignation of Nursultan Nazarbayev, the only president that independent Kazakhstan has ever had, marks a critical juncture for the country. Nazarbayev came to power at a time of profound and unexpected change, and his semi-departure could have equally unpredictable consequences.

Xi and Trump Miss Their Chance
Jeffrey Frankel (Project Syndicate) Mar 21, 2019
A successful US-Japan agreement on structural reforms three decades ago could potentially serve as a useful model for the current China-US trade negotiations. But Chinese President Xi Jinping appears to care only about maintaining political control, while US President Donald Trump seems to care only about himself.

Monetary policy in times of uncertainty
Giuseppe Ferrero, Mario Pietrunti and Andrea Tiseno (VoxEU) Mar 21, 2019
Dealing with uncertainty about the state of the economy is one of the main challenges facing monetary policymakers. In recent years there has been an extensive debate on the value of some of the deep parameters driving the economy, such as the natural rate of interest and the slope of the Phillips curve, estimates of which are quite uncertain. This column argues that when facing uncertainty on the structural relationship among macroeconomic variables, central banks should adopt a pragmatic and data-dependent approach to adjusting their monetary policy stance.

https://www.ft.com/content/5edbdc72-4bd6-11e9-8b7f-d49067e0f50d
FT View Mar 22, 2019
The US central bank has improved both its analysis and its messaging.

The Brexit farce is about to turn to tragedy
Robert Cooper (FT) Mar 22, 2019
Britain is paying for its ignorance of how the EU actually works.

Charts that show why Italy wants China’s Belt and Road Initiative
Valentina Romei (FT) Mar 22, 2019
Stuttering economy lags EU peers as a trade and investment partner for Beijing.

The Choice Is Britain's
WSJ Mar 22, 2019
The EU grants a short Brexit reprieve, but the U.K. is still paralyzed.

All roads lead to Rome for Xi
Pepe Escobar (AT) Mar 22, 2019
Italian PM Giuseppe Conte says the partnership on Belt and Road projects with China is strictly business.

Trump turns attention to Japan trade deal
William Pesek (AT) Mar 22, 2019
Abe is now getting trumped as the White House has set its sights on Tokyo.

Make the Fed’s Latest Dot Plot the Last
Bloomberg View Mar 22, 2019
It’s no longer needed, and its message begs to be misunderstood.

The Pound Might Just Survive Brexit
Marcus Ashworth (Bloomberg View) Mar 22, 2019
The U.S. and European economies are in a much weaker state than at the time of the referendum. In the relative world of currencies, that matters.

Bolsonaro’s U.S. Trip Was a Globalist’s Dream
Mac Margolis (Bloomberg View) Mar 22, 2019
The “Trump of the Tropics” comes back from the swamp looking awfully multilateral.

Fed's Pivot Marks a Major Break
Timothy A Duy (Bloomberg View) Mar 22, 2019
Chairman Jerome Powell is moving the central bank away from models that have failed it and led to December’s policy error.

All Signs Point to a Housing Boom Ahead
Conor Sen (Bloomberg View) Mar 22, 2019
Just as many millennials enter their home-buying years, the labor market is strong and interest rates are low.

Inverted Yield Curve Reminds Investors That Cycles End
Brian Chappatta (Bloomberg View) Mar 22, 2019
Buyers of risky assets should begin to brace for a rough patch in the coming years.

Brexit and the Speaker’s Tale
Marion Turner (Project Syndicate) Mar 22, 2019
The recent dramatic intervention in the Brexit debate by the Speaker of the British House of Commons highlights the continued importance of a 643-year-old institution. But whether current incumbent John Bercow is upholding the office's honorable tradition of speaking truth to power probably depends on one's view of Brexit.

The Rich Can Fight Inequality, Too
Kaushik Basu (Project Syndicate) Mar 22, 2019
Many wealthy people in the United States and elsewhere support the objective of curbing extreme economic inequality. They should not allow allow themselves to be silenced by right-wing accusations of hypocrisy.

The Ambition Europe Needs
Dominique Moisi (Project Syndicate) Mar 22, 2019
Whereas the Europe of the 1950s was desperate to ensure peace and freedom, underpinned by liberal democratic systems and values, the Europe of 2019 is electing nationalist and populist parties that are actively undermining that effort. This is not a status quo anyone – especially not Germany – should be defending.

EU-UK global value chain trade and the indirect costs of Brexit
Rita Cappariello, Michele Mancini and Filippo Vergara Caffarelli (VoxEU) Mar 22, 2019
EU and the UK production networks are highly integrated, and Brexit poses a threat to supply and demand linkages between the two economies. This column describes how the effect of tariffs will be magnified due to back-and-forth trade across the Channel. This will increase production costs in the UK and, to a lesser extent, in the EU.

The Mandarin model of growth
Wei Xiong (VoxDev) Mar 22, 2019
What is the Mandarin model and how has it affected China's economic and financial stability?

Brexit Is Postponed, but Chaos Still Reigns
Amy Davidson Sorkin (New Yorker) Mar 22, 2019
The European Union granted the U.K. a short extension to reach a deal on Brexit. It’s not what Theresa May asked for, but she was lucky to get it.

European Recession Revisited
Erik Nelson (WF) Mar 22, 2019
Fears of a Eurozone recession are back in the headlines today after a series of disappointing PMI figures from the currency bloc. We are not convinced that the Eurozone economy is headed for recession, but it is hard to get particularly excited about the region's economic prospects, or the prospects for the euro, at this point.

EM investors can take only small comfort from Fed
Jonathan Wheatley (FT) Mar 23, 2019
Prospect of a central bank more minded to cut rates is not unalloyed good news.

In leveraged loans, sellers are still in near-total control
Joe Rennison (FT) Mar 23, 2019
Market sell-off late last year had raised hopes of extra protections for buyers.

A sensible Brexit solution is in everybody’s interests
Matteo Renzi (FT) Mar 23, 2019
But if Westminster cannot find a way out, the public must have its say in a referendum.

China’s Hydrogen Economy Is Coming
Adam Minter (Bloomberg View) Mar 23, 2019
The world’s electric-vehicle king is seeking leadership in fuel cells, too. Investors are probably right to be excited.

Europe’s public interest problem with Chinese investment
Jonathan Ford (FT) Mar 24, 2019
To address worries Beijing could ease market access and increase protection of IP.

A no-deal Brexit remains highly likely
Wolfgang Münchau (FT) Mar 24, 2019
EU leaders do not want further delay, and MPs will struggle to unite around an alternative plan.

Decentralisation the best bet for Malaysia’s growth
Wing Thye Woo (EAF) Mar 24, 2019
Growth requires state governments that are empowered to plan and implement their own development strategies.

Is the Recession Red Flag Waving at Emerging Markets?
Shuli Ren (Bloomberg View) Mar 24, 2019
A predictor of past downturns is flashing a warning sign. There may be more room for a recent rally to run, but we all know how this movie ends.

OPEC and the Fed Are in the Same Uncertain Boat
Julian Lee (Bloomberg View) Mar 24, 2019
It’s particularly tough to get a good read on either crude supply or demand. Kicking the can down the road won’t help oil ministers.

India's Crony Capitalist Edifice Is Creaking
Andy Mukherjee (Bloomberg View) Mar 24, 2019
An entrenched feudal system threatens to burden the nation with an equivalent of South Korea’s chaebol discount. Change is needed.

The Global Wealth Illusion Is Paper-Thin
Satyajit Das (Bloomberg View) Mar 24, 2019
Mark-to-market values have become less reliable as more money moves into private investments. The next crisis may bring a rude awakening.

A Bonkers U.K. Establishment Drags Everyone Down
Pankaj Mishra (Bloomberg View) Mar 24, 2019
“Brexit is a symptom, the most ominous yet, of a broader crisis of elite credibility and legitimacy.”

Europe’s public interest problem with Chinese investment
Jonathan Ford (AT) Mar 24, 2019
To address worries Beijing could ease market access and increase protection of IP.

There’s Danger in Misreading the Inverted Yield Curve
Mohamed Aly El-Erian (Bloomberg View) Mar 24, 2019
It doesn’t necessarily signal that a recession is on the way.

US corporate debt is high but not yet dangerous
Gavyn Davies (FT) Mar 25, 2019
Financial balance is strong but the leveraged loan market is a pocket of elevated risk.

National champions are not the way to beat China
Rana Foroohar (FT) Mar 25, 2019
Smart industrial policy is a good thing but oligopoly is not.

China struggling to quit its debt addiction
Gabe Wildau (FT) Mar 25, 2019
State controls have so far seen off any contagion from bad loans.

Brexit is part of a wider European struggle
Gideon Rachman (FT) Mar 25, 2019
All of the EU’s big six countries are facing deep internal divisions.

The Silk Road Trap by Jonathan Holslag
Alan Beattie (FT) Mar 25, 2019
How ‘Belt and Road’ pushes the EU off-track.

The only way out of Brexit lies with the people
Lara Spirit (WP) Mar 25, 2019
Brexit was always an ideological fantasy fostered by Britain’s elite.

Trump's boom and bust
David Goldman (AT) Mar 25, 2019
World trade began contracting during the fourth quarter, as corporations postponed capital investment in response to the US-China tariff war.

Lockin’ tax haven’s door
Enrico Bergamini (Bruegel) Mar 25, 2019
Tax avoidance and evasion harm the public coffers, and increase inequality and poverty. This post summarises the recent debate on several aspects of the issue: the update of the European blacklist of tax havens and the related recent report from Oxfam, a call for reform of international taxation by the IMF, and the request for IRS reform by US democratic senators.

Lessons from Portugal’s Recovery
David Lipton (IMF) Mar 25, 2019
Are Europe and Portugal are properly prepared to sustain growth, to prevent another systemic shock, and to react to whatever comes?

Hustlers, Mavens, and Rainmakers: How the Informal are Inheriting Africa
Bright Simons (CGD) Mar 25, 2019
What is informality—and is it really such a bad thing?

Low Interest Rates Might Be What’s Hurting Growth
Noah Smith (Bloomberg View) Mar 25, 2019
Cheap credit does a poor job of weeding out zombie companies that compete for scarce resources.

How to Govern a Digitally Networked World
Anne-Marie Slaughter and Fadi Chehadé (Project Syndicate) Mar 25, 2019
Because the Internet is a network of networks, its governing structures should be, too. The world needs a digital co-governance order that engages public, civic, and private leaders on the basis of three principles of participation.

Humanitarian Markets
Ricardo Hausmann (Project Syndicate) Mar 25, 2019
The role of humanitarian assistance is like that of a car battery: it gets the cylinders moving until the sequence of internal explosions in the engine recharges the battery and makes the process self-sustaining. That task is made easier by using, rather than replacing, markets.

The Fed Board Unmoored
J. Bradford DeLong (Project Syndicate) Mar 25, 2019
Over the course of his presidency, Donald Trump has consistently prized sycophancy above expertise in his selection of advisers and political appointees. But by nominating the right-wing talking head Stephen Moore to the US Federal Reserve Board of Governors, Trump is taking his war on expertise to a new level.

Truly Taking Back Control
Raghuram G. Rajan (Project Syndicate) Mar 25, 2019
When people are more able to shape their own futures, they are less likely to be convinced that others are to blame for their plight. To the extent that it weakens support for virulent nationalism, devolution of global governance to national and local communities may make the world a little more prosperous – and a lot safer.

The Economic Consequences of Global Uncertainty
Michael Spence (Project Syndicate) Mar 25, 2019
With new sources of uncertainty seemingly proliferating by the day, a broad economic slowdown should come as no surprise. And as long as the rules and institutions governing the global economy remain in doubt, continued underperformance is to be expected.

Which Exchange Rate Regime? Credibility and Exchange Rate Neutrality
Biagio Bossone (RGE) Mar 25, 2019
For highly-indebted and poorly-credible economies, the exchange rate is a ‘veil.’

QE Redux: Have We Been Here Before? Fed Policy Review Part 3
Jay H. Bryson, Sarah House and Erik Nelson (WF) Mar 25, 2019
In the third of a series of reports examining how the Fed's framework and toolkit may evolve in the coming years, we discuss the potential for the Federal Open Market Committee to return to quantitative easing.

Which Economies Can Catch a Cold When the Eurozone Sneezes?
Jay H. Bryson (WF) Mar 25, 2019
Growth has slowed significantly in the Eurozone, but value added in large economies such as the United States, China and Japan are not overly dependent on final spending in the euro area.

Climate Change and the Federal Reserve
Glenn Rudebusch (FRBSF Econ Letter) Mar 25, 2019
Climate change describes the current trend toward higher average global temperatures and accompanying environmental shifts such as rising sea levels and more severe storms, floods, droughts, and heat waves. In coming decades, climate change—and efforts to limit that change and adapt to it—will have increasingly important effects on the U.S. economy. These effects and their associated risks are relevant considerations for the Federal Reserve in fulfilling its mandate for macroeconomic and financial stability.

The Asian century is set to begin
Valentina Romei and John Reed (FT) Mar 26, 2019
The region was the envy of Europe in 17th century and the world is about to turn full circle.

Parliament must restore some sanity over Brexit
FT View Mar 26, 2019
MPs have a chance to take charge of the process. They should seize it.

Do alternatives deserve a place in your portfolio?
Matthew Vincent (FT) Mar 26, 2019
As volatility stalks world equity markets, wealth managers look to alternatives.

Beware the value traps in a falling market
Laurence Fletcher (FT) Mar 26, 2019
Already affordable assets can get a lot more affordable.

Physical oil traders aren’t buying hedge fund optimism
David Sheppard (FT) Mar 26, 2019
Royal Dutch Shell and Glencore remain cautious on whether the oil price recovery has much further to run.

Trump had chance to gain greater leverage over China but blew it
Tom Mitchell (FT) Mar 26, 2019
US multinationals believe TPP pact would have been more effective than trade tariffs.

Slower growth in ageing economies is not inevitable
Economist Mar 26, 2019
But avoiding it means tough policy choices.

The grain of sand that broke the bank
Brian Caplen (Banker) Mar 26, 2019
Risk managers should park their traditional models and head to the beach if they want to understand the latest techniques.

How global development leaders think their field is changing
George Ingram and Kristin M. Lord (Brookings) Mar 26, 2019
Findings from a new report that surveys leaders from government, NGOs, the private sector, and multilateral institutions to understand how they see global development changing, what they forecast for the future, and how their own organizations are adapting.

DIBs: Value for Money or Just an Interesting Financing Mechanism?
Cassandra Nemzoff, Lorcan Clarke and Kalipso Chalkidou (CGD) Mar 26, 2019
At the end of 2018, the world had seven development impact bonds (DIBs) and more in the pipeline. Yet questions remain about the potential of DIBs—still a new financing instrument—compared to other pay-for-performance arrangements. With a dearth of standard and transparent evaluation methods, it is difficult to reliably assess whether DIBs are good value for money, and if they are, how best to structure them to maximize their efficiency.

Central Banks Shouldn't Fight Deflation
Frank Shostak (Mises Wire) Mar 26, 2019
The real problem was the money supply inflation that happened during the boom phase. Combating deflation in the bust phase only superficially treats a symptom of the boom-bust cycle.

Does Capitalism Kill Cooperation?
Peter Turchin (Evonomics) Mar 26, 2019
Evidence that innovation and growth isn’t based on economic self-interest.

High Risk Is Not the Answer to Negative Yields
Brian Chappatta (Bloomberg View) Mar 26, 2019
In a global debt market gripped by volatility, moderation is the best policy.

Struggling to Reach 2 Percent Inflation? Try Three!
Daniel Moss (Bloomberg View) Mar 26, 2019
There’s been talk of weakening support for Japan’s price-increase target. Far from abandoning it, the BOJ should double down to change psychology.

The Muscle That Backed China's Stimulus Is Quaking
Shuli Ren (Bloomberg View) Mar 26, 2019
The country’s $2 trillion development bank has been noticeably low-profile these days. It may not be in shape to help this next round of easing.

Italy’s Hug Makes China Feel Warm Inside
Virginia Postrel (Bloomberg View) Mar 26, 2019
The first G-7 country to join Belt and Road embraces Beijing’s benign view of its place in the world.

Turkey's Problems Appear to Be Ring-Fenced
Marcus Ashworth (Bloomberg View) Mar 26, 2019
So long as the country's focus stays on supporting its currency, the impact on markets will be limited. The domestic situation is a different matter.

The Fed Doesn't Understand How Inflation Works
Jim Bianco (Bloomberg View) Mar 26, 2019
The central bank’s complicated formulas don’t align with real world experiences.

China and Its Western Critics
Andrew Sheng and Xiao Geng (Project Syndicate) Mar 26, 2019
Contrary to popular belief in the West, China's trial-and-error approach to policymaking supports accountability. In fact, the evidence shows that Chinese policy is responsive to feedback from the Chinese people and the international community, with leaders correcting mistakes and updating policies as they gain new information.

Let the People Decide on Brexit
Hans-Werner Sinn (Project Syndicate) Mar 26, 2019
British voters now know far more about Brexit and its possible consequences than they did at the time of the 2016 referendum. Given the narrow majority for leaving the European Union back then, and the impasse at which UK institutions find themselves now, holding a new referendum is both appropriate and necessary.

Investing in Inclusive Growth
Lee Jong-Wha (Project Syndicate) Mar 26, 2019
An inclusive labor market is a prerequisite for inclusive growth. That's why policymakers should be making education and skills development for all workers a top priority, rather than embracing protectionism or excessive social-welfare spending.

China’s Challenge to a US-Led World Order
Xueying Zhang and Yue (Hans) Zhu (YaleGlobal) Mar 26, 2019
World order will shift as long as big problems go unresolved.

Inverted Yield Curve: Is It Different This Time?
Jay H. Bryson (WF) Mar 26, 2019
The recent inversion of the yield curve is not very significant in a historical context, and previous Fed purchases of Treasury securities for its QE program means that the curve is probably flatter than it otherwise would be.

The eurozone needs a dose of fiscal stimulus
FT View Mar 27, 2019
Germany and other surplus countries have room to expand spending.

The Brexit delusion of taking back control
Martin Wolf (FT) Mar 27, 2019
The UK is a large minnow, but still a minnow, in a very big lake.

Emerging market equities justify their existence
Steve Johnson (FT) Mar 27, 2019
Risk, return and diversification benefits appear to stack up, despite criticism.

Reform path looks as rocky as ever for emerging economies
Jonathan Wheatley (FT) Mar 27, 2019
Investors have been unnerved by loss of post-election momentum in Mexico and Brazil.

The other side of Chinese investment in Africa
Emily Feng and David Pilling (FT) Mar 27, 2019
Beyond the Belt and Road infrastructure projects, thousands of entrepreneurs from China are also setting up on the continent.

19th-Century ‘Humiliation’ Haunts China-U.S. Trade Talks
Alan Rappeport (NYT) Mar 27, 2019
China’s surrender to Western powers after the first Opium War helps explain Beijing’s interest for a global trading order that works more on its terms, historians say.

The EU bows to 'systemic rival' China
Pepe Escobar (AT) Mar 27, 2019
Slowly but surely, the EU is shifting its priorities to the East.

Xiplomacy wins in Europe despite US warnings
Simon Roughneen (AT) Mar 27, 2019
Economic opportunities trump Trump's security and strategic concerns.

China’s economic journey skirts road to perdition
Gordon Watts (AT) Mar 27, 2019
President Xi’s triumphant European tour fails to hide the problems lurking on the horizon.

Has the next bubble arrived?
Robert Samuelson (WP) Mar 27, 2019
A new article warns that the economy might be on the edge of a giant “wealth bubble” that will collapse with possibly dire consequences.

Flaws in Bitcoin make a lasting revival unlikely
Economist Mar 27, 2019
The latest bubble invites comparisons with past financial manias.

A no-deal Brexit would send sterling to its lowest level since 1985
Economist Mar 27, 2019
How political betting markets can predict financial asset prices.

Takeaways from Xi Jinping’s visit to France and Italy and ideas for the EU-China summit
Alicia García-Herrero (Bruegel) Mar 27, 2019
The author appraises China's strategy towards Europe ahead of next month's EU-China summit.

Emerging Markets Outlook: The Wealth of Nations
Yacov Arnopolin, Francesc Balcells, Kofi Bentsi, Pramol Dhawan, and Gene Frieda (PIMCO) Mar 27, 2019
Emerging markets (EM) have been fast out of the gate in 2019, recalling last year’s strong start and subsequent stumble. While we have a constructive outlook for EM this year, tensions between uncertainties over global growth and the dovish response from the Federal Reserve mean the journey ahead will likely be circuitous, punctuated by bouts of volatility that separate the strong from the weak. PIMCO sees many opportunities within the asset class by focusing on alpha potential.

Lower Interest Rates Could Come Faster Than We Realize
Daniel Moss (Bloomberg View) Mar 27, 2019
Global deceleration keeps catching officials off-guard. Fed rate cuts were once a fringe view – no longer.

China Bad Debt Is a $300 Billion Value Trap
Anjani Trivedi (Bloomberg View) Mar 27, 2019
Foreign investors without local expertise wade into the market for soured-loan securities at their peril.

A Boycott Is the Underpriced Risk of a Second Brexit Vote
Danny Hatem (Bloomberg View) Mar 27, 2019
Brexit-supporters could just decide to abstain from voting in a second referendum. What then?

Bond Trading Is Only for the Brave in This Shock Rally
Brian Chappatta (Bloomberg View) Mar 27, 2019
Invest at your own risk after a rapid dovish shift among central banks.

Hot Emerging Markets May Be in for a Shock
Komal S Sri-Kumar (Bloomberg View) Mar 27, 2019
The global economic slowdown flagged by lower interest rates and bond yields will ultimately be a net negative.

How 5G Can Advance the SDGs
George Lwanda (Project Syndicate) Mar 27, 2019
A powerful tool for achieving the 2030 Sustainable Development Agenda is already here. African governments must come together not only to invest in building 5G networks, but also to seize all of the opportunities those networks create – including a quality education for all.

Europe Must Unite on China
Guy Verhofstadt (Project Syndicate) Mar 27, 2019
The Italian government's decision to endorse China's "Belt and Road Initiative" is antithetical to European and Italian interests alike, and plays directly into Chinese President Xi Jinping's hands. While the European Union should pursue a closer relationship with China, it must do so as a single bloc – and thus on a co-equal footing.

No Middle-Income Trap for China
Stephen S. Roach (Project Syndicate) Mar 27, 2019
The days of 10% annual growth for the Chinese economy have ended, as was inevitable. But there is good reason to believe that the real story is not the slowdown, but the shift in Chinese output from quantity to quality.

Accounting for Urban China’s Rising Income Inequality: The Roles of the Labor Market, Human Capital, and Marriage Market Factors
Shuaizhang Feng and Gaojie Tang (VoxChina) Mar 27, 2019
China has witnessed persistent increases in economic inequality since the early 1990s when the urban labor market began its transformation — from centrally-controlled to market-driven. Using the Urban Household Survey data, this paper (Feng and Tang, 2018) documents the trends in income inequality over the period of 1992-2009 and decomposes changes in income inequality by considering three main factors: the labor market, human capital, and marriage market. We find that labor market factors account for approximately three-quarters of the overall increases in income inequality while the falling marriage rate has contributed the other quarter. Changes in human capital levels and marital assortativeness have not contributed to the rising inequality.

Monetary policy, macroprudential policy, and financial stability
David Martinez-Miera and Rafael Repullo (VoxEU) Mar 27, 2019
Various factors have been advanced as possible causes of the build-up of risks leading to the Global Crisis, and multiple policies have been put forward to address them. This column discusses the effectiveness of monetary policy and macroprudential policy in responding to the build-up of risks in the financial sector. While both policies are useful, macroprudential policy is more effective in terms of financial stability and can lead to higher welfare gains.

Accounting for Urban China’s Rising Income Inequality: The Roles of the Labor Market, Human Capital, and Marriage Market Factors
Shuaizhang Feng, Gaojie Tang (VoxChina) Mar 27, 2019
China has witnessed persistent increases in economic inequality since the early 1990s when the urban labor market began its transformation — from centrally-controlled to market-driven. Using the Urban Household Survey data, this paper (Feng and Tang, 2018) documents the trends in income inequality over the period of 1992-2009 and decomposes changes in income inequality by considering three main factors: the labor market, human capital, and marriage market. We find that labor market factors account for approximately three-quarters of the overall increases in income inequality while the falling marriage rate has contributed the other quarter. Changes in human capital levels and marital assortativeness have not contributed to the rising inequality.

What Sri Lanka’s 2019 Budget Tells Us About Its Economic Health
Umesh Moramudali (Diplomat) Mar 27, 2019
In the aftermath of political turmoil, Sri Lanka’s government will be hard-pressed to manage debt and growth in 2019.

The US, China and ‘Technology War’
Darren Lim (Global Asia) Mar 27, 2019
From the US block on Huawei to China’s block on Google, the two nations are competing for technological dominance in the 21st century. s

This Is What ‘Taking Back Control’ Looks Like
Stephen Paduano (FP) Mar 27, 2019
Britain will have less and less ability to influence how Brexit evolves from now on.

Investors in EM currencies walk tightrope between risk and return
Eva Szalay (FT) Mar 28, 2019
‘Long’ bets remain popular despite fears about the outlook for global growth.

Why investors can’t get enough of negative-yielding bonds
Robert Smith (FT) Mar 28, 2019
Resurgence of sub-zero debt is a sign of the grab-fest in the European credit markets.

A leveraged loan bust will hurt less than subprime
Anthony Carter (FT) Mar 28, 2019
Expect investors rather than banks to be hardest hit by the next meltdown.

Britain’s most dynamic industries now lack fizz
Chris Giles (FT) Mar 28, 2019
The long tail of mediocre companies is not responsible for the productivity shortfall.

US-China trade deal no cure-all for Chinese exporters
FTCR Mar 28, 2019
Even if an agreement ends the dispute, the global economy is still slowing.

Premier Li emerges from trade war shadowlands
Gordon Watts (AT) Mar 28, 2019
But despite his optimistic speech at Hainan's Boao Forum, all eyes are fixed on the US-China talks in Beijing.

China debt trap fears shake the Philippines
Richard Javad Heydarian (AT) Mar 28, 2019
Exposed terms of a Chinese infrastructure loan to Manila controversially allow for the confiscation of national assets in case of default.

Three Key Takeaways From PIMCO’s Cyclical Outlook: Flatlining at The New Neutral
Joachim Fels (PIMCO) Mar 28, 2019
Following the Federal Reserve’s pivot to patience, we believe U.S. short-term interest rates are now anchored in The New Neutral. Global growth keeps synching lower, but may experience a soft landing later this year if China’s economy stabilizes and trade tensions ease. However, political uncertainties suggest a cautious overall approach to investing. These are three key conclusions we discuss in detail in our latest Cyclical Outlook, “Flatlining at The New Neutral.”

Poverty in Africa is now falling—but not fast enough
Kristofer Hamel, Baldwin Tong and Martin Hofer (Brookings) Mar 28, 2019
Africa is the world’s last frontier in the fight against extreme poverty. Today, one in three Africans—422 million people—live below the global poverty line. They represent more than 70 percent of the world’s poorest people.

The Euro Area: Creating a Stronger Economic Ecosystem
Christine Lagarde (IMF) Mar 28, 2019
Twenty years ago, European countries did not just plant one tree, they planted an entire forest—creating a new economic ecosystem known as the euro area. The fundamental strength of that system lies in its interconnectedness and diversity—a combination that can help Europe to fully unlock its immense economic potential.

Global Shocks and the U.S. Economy
Richard H. Clarida (FRB) Mar 28, 2019
I will discuss how the U.S. economy's increasing integration with the rest of the world has made it more exposed to foreign shocks, and I will focus in particular on the channels of transmission through which these shocks operate.

The Biggest Brexit Loser This Time Wasn't May
Therese Raphael (Bloomberg View) Mar 28, 2019
Her party’s euroskeptic wing overplayed its hand and is now faced with the prospect of Britain not leaving at all or a softer departure.

The ECB Is Struggling With Three Big Questions
Ferdinando Giugliano (Bloomberg View) Mar 28, 2019
Peter Praet’s comment on tiering interest rates is just one example of where the ECB can’t make its mind up. The others are the outlook and inflation.

The Fed’s Future Is Political
Karl W Smith (Bloomberg View) Mar 28, 2019
Monetary policy used to be the topic of presidential debates. The nomination of Stephen Moore could make it so again.

Brexit Fever is Breaking
Anatole Kaletsky (Project Syndicate) Mar 28, 2019
A no-deal disaster is still theoretically possible when the next Brexit deadline arrives on April 12. But a much longer extension is almost certain, now that the principle of a potentially endless negotiation has prevailed.

A Low-Carbon Belt and Road
Ma Jun and Simon Zadek (Project Syndicate) Mar 28, 2019
China’s Belt and Road Initiative is set to spur a sharp acceleration in GDP growth and development across the 60-plus participating economies. In order to ensure that BRI-related infrastructure projects don't also undermine global climate action, meaningful steps must urgently be taken to reduce their carbon footprint.

How to Build a Patient Investment Bank
Mariana Mazzucato and Laurie Macfarlane (Project Syndicate) Mar 28, 2019
If they are well structured and governed, public investment banks can be powerful catalysts for investment-led growth. But governments that establish such institutions should adhere to four guidelines.

The Eurozone’s Real Weakness
Lucrezia Reichlin (Project Syndicate) Mar 28, 2019
A new eurozone crisis would most likely have a less uneven effect than in 2008 or 2011, not least because its largest economies are currently weak. But if a recession hits, policymakers will find it hard to mount an effective response.

Europe Needs a Global Strategy
Joschka Fischer (Project Syndicate) Mar 28, 2019
The increasingly sharp rivalry between the United States and China could have negative economic and other consequences for Europe. But instead of forging a strategic vision suitable to this risk, European leaders are, as per usual, preoccupied with their own problems.

Algeria’s Second Arab Spring?
Ishac Diwan (Project Syndicate) Mar 28, 2019
Since February, the long-entrenched regime of Algerian President Abdelaziz Bouteflika has been beset by mass protests and demands for economic and political liberalization. The potent mix of anger and hope fueling the demonstrations suggests that the country's elite erred in slow-rolling earlier reforms.

Disruption and credit markets
Bo Becker and Victoria Ivashina (VoxEU) Mar 28, 2019
In the past 30 years, defaults on corporate bonds in the US have been substantially above the historical average. Using firm-level data, this column shows that the increase in credit risk can be largely attributed to an increase in the rate at which new and fast-growing firms displace incumbents, a phenomenon defined as ‘disruption’. Incumbent revenue growth suffers when there are many IPOs in an industry, and newly issued bonds in high-disruption industries have higher yields.

Clamour for bonds highlights looming market tension
Michael Mackenzie (FT) Mar 29, 2019
With inverted and sub-zero yields, investors are clearly looking beyond the stock rally.

Multilaterals must earn the right to limited immunity
Daniel Bradlow (FT) Mar 29, 2019
World Bank and others should strengthen independent accountability.

Brexit is not a disappointment — yet
Merryn Somerset Webb (FT) Mar 29, 2019
Leavers are poised to get much more than they hoped for in 2016.

It’s Anyone’s Brexit Now
WSJ Mar 29, 2019
May loses for a third time, so no deal or no Brexit are possible.

The U.K.’s Brexit Journey of Self-Discovery
Joseph C. Sternberg (WSJ) Mar 29, 2019
Crises of identity are common in the West, but Britain’s came with an impossible deadline.

New kind of deflation impels the great bond rally
David P. Goldman (AT) Mar 29, 2019
Bond yields are dropping around the world because the world economy is slowing and inflation is evaporating.

Brexit: When in doubt, slow down
Maria Demertzis and Nicola Viegi (Bruegel) Mar 29, 2019
Uncertainty over Brexit remains high despite looming deadlines. Here, the authors argue that the UK should take the necessary steps to make time to build consensus around the final shape of Brexit, and that the UK population should be consulted.

The Troubling Rise of Economic Nationalism in the European Union
Jeromin Zettelmeyer (PIIE) Mar 29, 2019
German and French politicians have been arguing for a more muscular response from the European Union (EU) to competitive threats from China and the United States. Some of the concerns motivating these calls are valid. But the proposed response—weakening intra-EU competition rules to push European champions (likely involving large French and German companies), adopting Chinese-style industrial policies, perhaps even restricting international trade—is far more likely to undercut than to boost innovation and growth in the EU. It will also make it harder for the EU to credibly advocate an open, multilateral international economic order.

The ECB's Power Struggle Will All End in Tiers
Marcus Ashworth (Bloomberg View) Mar 29, 2019
There’s an arcane battle going on over the future direction of the central bank's monetary policy. So-called “tiering” of deposit rates would solve little.

Yield-Curve Inversion May Speed Up the Dash for Cash
Brian Chappatta (Bloomberg View) Mar 29, 2019
Individual investors have already been piling into Treasury bills.

The Revolution Need Not Be Automated
Daron Acemoglu and Pascual Restrepo (Project Syndicate) Mar 29, 2019
For centuries after the Industrial Revolution, automation did not hinder wage and employment growth, because it was accompanied by new technologies geared toward maintaining the role of human labor in value creation. But in the era of artificial intelligence, it will be up to policymakers to ensure that the pattern continues.

What if Zero Interest Rates Are the New Normal?
Adair Turner (Project Syndicate) Mar 29, 2019
The valid insight behind "modern monetary theory" – that governments and central banks together can always create nominal demand – was explained by Milton Friedman in 1948. But it is vital also to understand that excessive monetary finance is hugely harmful, and it is dangerous to view it as a costless way to solve long-term challenges.

The Brexit Hour Has Come
Chris Patten (Project Syndicate) Mar 29, 2019
With Brexit possibly just two weeks away, most British voters and members of Parliament are still in the dark. Sadly, the national interest has taken a back seat to ideological obsession and the leadership ambitions of some of Prime Minister Theresa May’s cabinet colleagues.

Was the Stock-Market Boom Predictable?
Robert J. Shiller (Project Syndicate) Mar 29, 2019
While the conventional wisdom holds that it is never possible to "time the market," it might seem that major shifts – like the quadrupling of the US stock market over the last decade – should be at least partly foreseeable. Why aren't they?

Border regimes and knowledge spillovers through the supply chain
Bruno Merlevede and Victoria Purice (VoxEU) Mar 29, 2019
Supplying inputs to multinational firms has been shown to increase the productivity of domestic firms, while borders have been shown to substantially reduce trade activities. This column investigates whether spillover effects from multinationals on local firms occur when firms are separated by a national border. Using data for seven Central and Eastern European countries and their neighbours, it finds that cross-border spillovers only occur after EU integration, and that participation in the Schengen Area magnifies these effects. The results bear testimony to successful EU integration and warn about potential productivity costs to local firms should border controls be reinstated.

Xi and Trump miss a chance to expand markets
Jeffrey Frankel (VoxEU) Mar 29, 2019
The supposed deadline for a conclusion to China–US trade negotiations has been postponed until late April. This column argues that the structural reform aspect of the negotiations is reminiscent of US negotiations with Japan three decades ago, and that the Structural Impediments Initiative between the two countries could, in theory, serve as a useful model for the current US–China negotiations. The question is whether Presidents Trump and Xi have as firm a grasp on economic principles as their predecessors.

Theresa May’s Third Brexit Loss Closes More Doors
Amy Davidson Sorkin (New Yorker) Mar 29, 2019
In her desperate attempts to get her Brexit deal approved, the British Prime Minister has increased the potential for upheaval.

Brexit’s failure leaves the UK in a profound crisis
FT View Mar 30, 2019
The only way forward is a delay, a rethink, and a softer form of EU exit.

May confronts Brexit choices she hoped never to face
Robert Shrimsley (FT) Mar 30, 2019
UK prime minister caught between compromise and splitting her party.

The bond market shadow over Trump’s re-election
Sam Fleming and Courtney Weaver (FT) Mar 30, 2019
While the president celebrated the end of the Mueller inquiry this week, the risk of a recession is rising.

How Countries Fall into the Welfare Trap
Antony P. Mueller (Mises Wire) Mar 30, 2019
Before wealth can be redistributed by the state, it must first be produced. But welfare-state policies end up destroying the very wealth which is necessary for redistribution

Message to UK: Make up Your Mind Now
Paul Goldschmidt (Globalist) Mar 30, 2019
The EU’s long term interests should prevail over short term accommodation of the UK’s whims.

The World Better Get Used to Negative Rates
Satyajit Das (Bloomberg View) Mar 30, 2019
They’re the only way to bring down excessive debt levels that have grown too large to be managed.

Firm R&D investment, export market exposure, and trade policy
Bettina Peters, Mark Roberts and Van Anh Vuong (VoxEU) Mar 30, 2019
International markets can provide exporting firms with more opportunities to generate and introduce innovations and capitalise on their investments relative to purely domestic firms. Using German data, this column demonstrates that exporting firms introduce innovations more frequently than domestic firms and have higher economic gains from their innovations. Trade restrictions such as tariffs can affect a firm’s economic activities in foreign markets and also their R&D and innovation activities.

It is time for a truly free market
Rana Foroohar (FT) Mar 31, 2019
Many Americans still argue that their economic system encourages competition.

Ageing and global trade imbalances are G20 priorities
Taro Aso (FT) Mar 31, 2019
With the crisis behind us, we must tackle the structural issues weighing on economic growth.

Ten years of the great bull market
Gavyn Davies (FT) Mar 31, 2019
What does this phenomenal rise in risk assets tell us about the future?

A cross-party approach to Brexit is now required
George Bridges (FT) Mar 31, 2019
An agreement for committing the UK to a customs union with the EU must be built fast.

A ‘Tiny’ Tax on Trades Would Hobble Markets
Jon Hartley (WSJ) Mar 31, 2019
Intended to halt high-frequency swaps, the levy would discourage low-cost investing.

Trump Is Bullying OPEC Again. He Might Get His Way
Julian Lee (Bloomberg View) Mar 31, 2019
The president's pleas to boost oil output are really targeted at the Saudis. There are good political reasons for them to agree.

Public debt through the ages
Barry Eichengreen, Asmaa El-Ganainy, Rui Esteves and Kris Mitchener (VoxEU) Mar 31, 2019
The history of sovereign debt evolved over time along with the purposes for which governments borrowed: first state building, then public-good provision, and most recently social welfare and entitlements. Although many periods when debt-to-GDP ratios rose explosively culminated in funding crises, debasements and restructurings, less widely appreciated are episodes of successful debt consolidation achieved through rapid growth or budgetary discipline. This column analyses the economic and political circumstances that made these debt consolidation episodes possible.