News & Commentary:

Articles/Commentary

Cutting China tariffs will offer no respite from rising prices
Oren Cass (FT) May 1, 2022
US policymakers must stand firm on the need to confront Beijing and rebalance global trade.

Western leaders must prepare public for a war economy
Martin Sandbu (FT) May 1, 2022
The cost of living crisis is likely to get worse before it gets better.

An ageing population grapples with the spectacle of the plunging yen
Leo Lewis (FT) May 1, 2022
Despite popular disquiet, a weak currency is good for corporate Japan.

The Bitter Fruit of Inflation: Dow 29500
Arthur Laffer and Stephen Moore (WSJ) May 1, 2022
The debacle of the 1970s reveals how disastrous surging prices can be for the economy and markets.

The G20 is too big to fail, so time to compromise on Russia and save the world economy
Yose Rizal Damuri and Peter Drysdale (EAF) May 1, 2022
Indonesia's role both in the G20, its standing in the developing world and its weight within ASEAN make it vital to the United States and China both. Indonesia's diplomatic instinct is to build bridges between the developed and developing world, an asset in the G20 which brings together all. Indonesia's size, legitimacy and its tradition of non-alignment mean it is one of the few that can lead the G20 in difficult times like these. The United States also needs Indonesia more than it realises for its own purposes: the Biden administration's Indo-Pacific Framework and indeed anything the United States does in Asia will need Indonesian buy-in in order to succeed.

The Extraordinary Wealth Created by the Pandemic Housing Market
Emily Badger and Quoctrung Bui (NYT) May 1, 2022
Rarely have so many Americans gained so much equity in so little time, but it's also inseparable from the housing affordability crisis.

The World's Economic Outlook Turns Grim
Lara Williams (Bloomberg Opinion) May 1, 2022
Between inflation, war, gas and Covid — and the specter of more problems on the horizon — it's hard to be optimistic for the rest of 2022.

Crypto and the Dollar Are Partners, Not Rivals
Niall Ferguson (Bloomberg Opinion) May 1, 2022
The disruptions of Covid and Russia's invasion of Ukraine have shown the strength of the Western system and the weakness of China's.

The Yen Is Tanking. And That's Just Fine
Gearoid Reidy, Daniel Moss, and Yuko Takeo (Bloomberg Opinion) May 1, 2022
The Bank of Japan appears to be comfortable with the currency's path, which puts inflation targets within reach. Consumers face a different reality.

Yen weakness is an opportunity, not a threat, for Japan
FT View May 2, 2022
For the central bank to raise interest rates would be a mistake.

Investors face volatility as demand stalls amid supply disruptions
Mohamed El-Erian (FT) May 2, 2022
Central bank tightening will pressure an already-slowing global economy.

A Global Tax System Is Good for the U.S.
Jason Furman (WSJ) May 2, 2022
Congress should implement the agreement that Yellen negotiated last year.

Is the UK Economy Heading for a Perfect Storm?
Alex Chapman (BRINK) May 2, 2022
The U.K. is bracing for the biggest drop in its living standards since the 1950s.

Fed Needs to Do More Than Raise Interest Rates
Mohamed A El-Erian (Bloomberg Opinion) May 2, 2022
The central bank must make progress on four critical issues to regain credibility and stabilize the economy.

The Ideal Portfolio to Survive a Bear Market
Gary Shilling (Bloomberg Opinion) May 2, 2022
Given how much the economy has changed in such a short period, what worked in the past may not work now.

Why the Federal Reserve Keeps Underestimating Inflation
Allison Schrager (Bloomberg Opinion) May 2, 2022
A Q&A with Dartmouth economist Andrew Levin about the economic risks the U.S. is facing and why the central bank got it so wrong.

Private-Debt Risks Are Hiding in Plain Sight
Carmen M. Reinhart and Leora Klapper (Project Syndicate) May 2, 2022
The debt moratoria introduced early in the pandemic provided temporary relief for private borrowers, and may have limited the fallout of the economic disruption. But recent data reveal that they also created a potentially disastrous non-performing loan problem.

The global inequality boomerang
Ravi Kanbur, Eduardo Ortiz-Juarez, and Andy Sumner (VoxEU) May 2, 2022
Global inequality has fallen over the last three decades, despite a rise in inequality within some large countries. This column argues that the decline in global inequality will reverse in the coming years, due to a turnaround in the between-country component of inequality. This inequality 'boomerang' is forecast to happen near end-2020s or early-2030s, although an inequal recovery from the Covid crisis could hasten the reversal. Thus, the 'sunshine' narrative of declining global inequality could prove temporary, and a boomerang would require new policies to combat inequality in the future.

How the Fed lost the plot
Edward Luce (FT) May 3, 2022
The era in which American monetary policy could rely on the 'Goldilocks' scenario is receding.

The consequences of a marked-to-market world
Peter Atwater (FT) May 3, 2022
With more real-time information on tap for retail investors and consumers, impact of falling asset prices can be felt more quickly.

The Era of Cheap and Plenty May Be Ending
Jeanna Smialek and Ana Swanson (NYT) May 3, 2022
Supplies of goods are coming up short in the pandemic, and prices have jumped. Some economists warn that the changes could linger.

Fed behind the curve on preventing US recession
Alex Domash and Lawrence H Summers (AT) May 3, 2022
The Federal Reserve will likely soon learn what gymnasts already know: sticking a landing is hard. By raising interest rates, the central bank is hoping to achieve for the US economy a proverbial "soft landing" in which it's able to tame rapid inflation without causing unemployment to rise or triggering a recession.

Don't Fret for Hong Kong's Dollar Peg Just Yet
Matthew Brooker (Bloomberg Opinion) May 3, 2022
The currency system is doing what it's supposed to do, and there's little sign of stress so far.

The Hideous Strength of the U.S. Dollar
Marcus Ashworth (Bloomberg Opinion) May 3, 2022
The U.S. currency's rapid rise will make it harder for other countries to curb inflation.

The Fed Does Not Deserve All the Inflation Blame
Kenneth Rogoff (Project Syndicate) May 3, 2022
The US Federal Reserve certainly bears its share of responsibility for the great inflation of the 2020s. But powerful political pressures from the left and overly-optimistic analyses of open-ended debt policy, not to mention genuine uncertainties about inflation and real interest rates, also played a very large role.

When Does Inflation Stop?
Koichi Hamada (Project Syndicate) May 3, 2022
To understand the increase in consumer price inflation around the world, one must look not only at supply and demand but also at the wedge that the coronavirus introduced between them. And now Russia's war on Ukraine has added another source of inflationary pressure.

Historical lessons on the real effects of unstable stablecoins
Chenzi Xu and He Yang (VoxEU) May 3, 2022
Innovations in private money creation, such as stablecoins, can be economically useful because they improve efficiency in the payments system. However, if these currencies are not fully 'stable', uncertainty over their value may be a source of transactions friction that have real costs. The column discusses how the National Banking Act of 1864 in the US provides a natural experiment for evaluating the effects of stabilising the value of private money. The act introduced a new type of private money that was fully stable for the first time. Gaining access to the stable money generated growth in economic sectors that were sensitive to transaction costs.

The Dangerous New Anti-Globalization Consensus
Edward Alden (FP) May 3, 2022
Soaring inflation is just one reason for Washington to keep global disintegration in check.

China's Doomed Fight Against Demographic Decline
Carl Minzner (FA) May 3, 2022
Beijing's efforts to boost fertility are making the problem worse.

An EU oil ban is a tightening noose on Russia's economy
FT View May 4, 2022
Moscow has limited scope to redirect crude sales to alternative markets.

The Fed Is Set to Pull Back Economic Help Rapidly. Is It Too Late?
Jeanna Smialek (NYT) May 4, 2022
Federal Reserve officials took a while to recognize that inflation was lasting. The question is whether they can tame it gently now.

The Fed's interest-rate hikes will hurt
Economist May 4, 2022
Financial markets are adjusting to the reality of tighter money.

The RBI Needs to Raise Rates More to Regain Credibility
Andy Mukherjee (Bloomberg Opinion) May 4, 2022
India's central bank took a relaxed approach toward inflation. Now it has to play catch-up and it'll be complicated.

Trade-Policy Dynamics: Evidence from 60 Years of US-China Trade
George Alessandria, Shafaat Khan, Armen Khederlarian, Kim Ruhl, and Joseph Steinberg (VoxChina) May 4, 2022
International trade depends on the effects of past trade policy and expectations of future trade policy. Disentangling these two forces is difficult, but the US-China trade relationship is ideally suited for study. A large, and largely unexpected, trade liberalization in 1980 kicked off a long, gradual expansion of Chinese exports to the United States. Until China's accession to the World Trade Organization (WTO) in 2001, these low tariff rates were relatively easy to revoke, generating time-varying uncertainty over their future values. We show that the dynamics of Chinese exports to the United States are shaped by both forces, with policy uncertainty depressing trade throughout the period, particularly during the 1980s. Coinciding with China's application to the General Agreement on Tariffs and Trade (GATT) in 1986, the likelihood of reversal fell dramatically, allowing trade in high tariff-risk goods to catch up. By the early 1990s the probability of higher tariff rates stood at about 10%. The persistence of this probability throughout the 1990s delayed the final adjustment to the initial 1980 reform until China's Permanent Normal Trade Relations (PNTR) access.

Zombie firms and the take-up of support measures during Covid-19
Marco Pelosi, Giacomo Rodano, and Enrico Sette (VoxEU) May 4, 2022
Governments around the world enacted unprecedented measures to support firms impacted by the Covid-19 pandemic. This column focuses on Italy to examine the extent to which these measures ended up also benefitting non-viable but still active firms. The authors find that 'zombie firms' were less likely than healthy firms to access public support measures in the form of either grants, debt moratoria, or government-guaranteed loans, suggesting that these measures did not contribute to a zombification of the economy.

The supply chain crisis kicks off a dangerous spiral of state subsidies
Alan Beattie (FT) May 5, 2022
It's hard to argue against governments giving handouts to farmers during a global food emergency.

The yen: a cheap haven for uncertain times
Zach Pandl (FT) May 5, 2022
Japanese currency will find support at a time of rising global recession risks and structural threats to the dollar.

Inflation and the investment outlook
John Redwood (FT) May 5, 2022
Official money printing has been replaced by rising interest rates.

The carbon offset market is falling short. Here's how to fix it
Thomas Hale (FT) May 5, 2022
Offsets are not necessarily a no-no — but companies must be transparent in how they use them.

China's zero-Covid stance is a warning to investors
Diana Choyleva (FT) May 5, 2022
Communist Party's reputation for pragmatism has been damaged by strategy to contain the pandemic.

Pakistan's economy is on the brink
Yousuf Nazar (FT) May 5, 2022
Failure to carry out meaningful reform will exacerbate existing political turmoil.

A Stock Market Reality Check
WSJ View May 5, 2022
Prices are volatile as investors try to judge the risks of tighter money.

The rising risk of China's tech decoupling
Marina Yue Zhang, David Gann and Mark Dodgson (AT) May 6, 2022
Tensions between China and the West are straining international cooperation in industries such as semiconductor and biopharmaceutical manufacturing. Taken together with the shocks of the Covid pandemic, and particularly China's rapid and large-scale lockdowns, these developments could lead to a decoupling of China's innovation system from the rest of the world.

Coping with high inflation and borrowing costs in emerging market and developing economies
Jongrim Ha, M. Ayhan Kose, and Franziska Ohnsorge (Brookings) May 5, 2022
As the old adage goes, all good things come to an end. Gone are the days of low inflation and easy global financial conditions. Many emerging market and developing economies (EMDEs) have recently been experiencing an unpleasant combination of elevated inflation and rising borrowing costs. At 8.5 percent in March 2022, inflation in EMDEs has reached its highest level since 2008 (Figure 1). In advanced economies, inflation is now at its highest level since 1991. Global financing conditions are tightening, as major advanced economy central banks are expected to raise policy interest rates at a faster pace than previously anticipated to contain inflationary pressures.

Don't Expect the Fed to Work Miracles
Bloomberg View May 5, 2022
In conditions like these, monetary policy can only do so much.

The Philippines Economy Is Great — By the Numbers
Daniel Moss (Bloomberg Opinion) May 5, 2022
Bullish growth forecasts mask serious vulnerabilities at the ground level. Whoever wins the presidential election has a delicate task ahead.

Central Bankers Are Handcuffed by Old Narratives
Clive Crook (Bloomberg Opinion) May 5, 2022
The sudden shift in views on inflation are a reminder of the danger of narratives that encompass too much and tie down policy makers.

It's a Long, Bumpy Road Back to 2% Inflation
Allison Schrager (Bloomberg Opinion) May 5, 2022
A Q&A with Dartmouth economist Andrew Levin about what it will take for the Fed to return the economy to "normal."

Stock Buybacks Are Helping Fight Inflation
Conor Sen (Bloomberg Opinion) May 5, 2022
Companies spending money to purchase their shares instead of expanding their businesses will help bring demand back in line with supply.

Bank of England Wobbles on the Tightrope Between Inflation and Recession
Marcus Ashworth (Bloomberg Opinion) May 5, 2022
The U.K. central bank seems to have lost some of its willingness to tackle inflation by raising interest rates.

Addressing Europe's Corporate Technology Gap
Jan Mischke and Jurica Novak (Project Syndicate) May 5, 2022
European firms currently lack the scale and agility they need to compete with their US and Chinese counterparts. Wise policymakers would harness the cooperative momentum generated by the Ukraine war and embrace the "transversal technologies" that are crucial to the region's future prosperity.

How the war in Ukraine may reshape globalisation
Michele Ruta (VoxEU) May 5, 2022
The war in Ukraine has suddenly increased geopolitical risks. This column argues that firms will respond to the shock by reassessing security-related risks, leading to changes in the structure of supply chains. But given the capital in place, the cost of searching for alternatives, and factors such as wage differentials across countries, this process is likely to be gradual rather than sudden and will affect different sectors and products differently. It will not result in a reversal of globalisation, unless it is supported by pronounced government intervention.

Dockworkers Worldwide Are Trying to Stop Russia's War
Elisabeth Braw (FP) May 5, 2022
Manual laborers keep the world moving—and can slow it down.

Central banks must play economic manoeuvres in the dark
FT View May 6, 2022
This has been a time of remarkable and unforeseeable shocks. More is to come.

We need to revitalise the world economy in inclusive ways
Raghuram Rajan (FT) May 6, 2022
It is hard but necessary for governments to reverse the trend towards deglobalisation.

The Fed owes the American people some plain-speaking
Gillian Tett (FT) May 6, 2022
Chair Jay Powell must acknowledge that free money has made asset prices unsustainably high.

Sanity appears to be returning to central bank policymaking
John Plender (FT) May 6, 2022
Years of overblown asset prices and mispricing of risk may be giving way to more normal conditions.

Policy-makers should shift focus to economic resilience
Tamim Bayoumi (OMFIF) May 6, 2022
The last decade-and-a-half has been hectic for economic policy-makers. They have had to cope with a global financial crisis, a worldwide pandemic and now a generalised burst of inflation combined with a European war. By responding sequentially, policy-makers risk missing the forest for the trees. A gestalt switch is needed that recognises that the evidence points to a major rise in instability. Restraint may not be a welcome message in a world with so many unknown unknowns. But facing entrenched economic instability, it just may be the correct one.

Industrial Demand May Finally Be Slowing
Brooke Sutherland (Bloomberg Opinion) May 6, 2022
Sales aren't falling off a cliff, but there are signs that growth has peaked.

Giving Up on the Bond Market Now Would Be a Mistake
Aaron Brown (Bloomberg Opinion) May 6, 2022
The five other times in history when stocks and Treasuries both had double-digit real drawdowns, government debt securities went on to soar.

Sri Lanka Needs a Currency Board
R. M. Manivannan (Project Syndicate) May 6, 2022
The time has come for Sri Lanka to face its financial demons head-on. It will be a difficult fight, but a currency board – which strips the government and the central bank of the opportunity to mismanage the budget and the exchange rate – vastly improves its chances of winning.

Europe's Gas Conundrum
Daniel Gros (Project Syndicate) May 6, 2022
If Europe is willing to pay the price of expensive LNG imports, it could severely undermine Russia's ability to earn hard currency via gas exports to finance the war in Ukraine. But this would carry high costs for Europe, too.

Biden's Foreign Aid Is Funding the Washington Bubble
Charles Kenny and Scott Morris (FP) May 6, 2022
As usual, U.S. assistance pays everyone except governments actually providing services to the world's poor.

As Tunisia's Democratic Experiment Unravels, Economic Collapse Looms
Vivian Yee (NYT) May 7, 2022
The president is consolidating one-man rule while the economy, sapped by mismanagement, the pandemic and war in Ukraine, flails. Groups that helped avert a past crisis are largely silent.

Globalization Isn't Dead, It's Just Not American Anymore
Henry Huiyao Wang (Bloomberg Opinion) May 7, 2022
Trade, investment and technology links between nations are growing more controlled and less mediated by Hollywood and Washington, but they are still thriving.

Learning about inflation expectations from the data
Francesco D'Acunto, Ulrike Malmendier, and Michael Weber (VoxEU) May 7, 2022
Inflation has surged to historic levels around the globe. Designing the correct policy responses requires a deep understanding of how consumers form and update their inflation expectations, and how expectations influence economic behaviour. This column summarises key findings in the literature on inflation expectations, particularly how they deviate from the full-information rational expectations paradigm. Household inflation expectations are typically biased upwards, systematically skewed, and correlated with social/demographic characteristics. Studying these heterogeneities and their impact on aggregate outcomes is a key challenge for policymakers going forward.

The world needs a 12-step programme for better trade
Rana Foroohar (FT) May 8, 2022
We have to start by admitting that there is a problem with the old model of globalisation.

Draghi and Scholz show how Europe's power balance is shifting
Anne-Sylvaine Chassany (FT) May 8, 2022
The contrasting fortunes of the German and Italian leaders mirror changing relations between north and south.

Spare America From Yellen's Global Tax
WSJ View May 8, 2022
Other countries aren't following a plan meant to hide Biden's corporate tax increases.

The international financial consequences of Mr Putin
Barry Eichengreen (EAF) May 8, 2022
What will be the reaction of China and of other countries worried about similarly being on the out with the United States? Will they shift their foreign exchange reserves away from US Treasury bonds? Will they reduce their reliance on the dollar and US banks? Will they curtail their commercial and technological dependence on the United States, cutting supply chains and reshoring production? Will the global economy be reconfigured into rival blocs?

The Philippines Can't Afford to Go Back to the Past
Bloomberg View May 8, 2022
Long-term prosperity requires that the country's next leader provide a bold vision, not nostalgia.

Sorry, But for You, Oil Trades at $250 a Barrel
Javier Blas (Bloomberg Opinion) May 8, 2022
The culprit is the refinery margin and the consequences are huge for global inflation.

The matching between workers and jobs explains productivity differentials across firms
Luca Coraggio, Marco Pagano, Annalisa Scognamiglio, and Joacim Tåg (VoxEU) May 8, 2022
Recent research has highlighted the contribution that managerial decisions make to firms' productivity. This column uses a novel measure of job-worker allocation quality to document how firms that match their employees to their most suitable jobs are more productive, and their ability to do so depends on the quality and experience of their management. The measure is helpful for uncovering a hitherto neglected dimension of managerial practices, and could be particularly valuable at times when the need to cope with technological innovation, pandemics, climate change, or wars requires widespread firm restructuring and workers' reallocation.

Explaining the disappointing trade effects of regional trade agreements
Youngmin Baek and Kazunobu Hayakawa (VoxEU) May 8, 2022
What can explain the small or even negative effects of regional trade agreements on trade? Using trade data between Japan and other 68 countries from 2002 to 2018, this column argues that RTAs reduce fixed costs for foreign direct investment more than exporters. This could have a negative effect on trade. A simulation exercise indicates that introducing RTA between Japan and China would incentivise Japanese firms to set up production in China and sell locally rather than export from Japan.

Investors are too bearish about the US stock market
Edward Yardeni (FT) May 9, 2022
S&P 500 still likely to hit record territory next year, even after a correction.

US Fed needs a Goldilocks touch to avoid recession
Urban C. Lehner (AT) May 9, 2022
Fed Chairman Jerome Powell's recent dismissal of three-quarter point hikes did indeed sound like good news to markets. But by taking such bigger increases off the table, the Fed risks underestimating the strength and durability of the inflationary forces troubling the economy. The consequences of such an underestimation could be profound.

Gold's Strange Behavior Shows It's No Haven
Jared Dillian (Bloomberg Opinion) May 9, 2022
Lately the precious metal is adding to portfolio volatility, moving with the broader markets instead of against them.

The war in Ukraine is likely to worsen Europe's economic problems
Olivier Blanchard and Jean Pisani-Ferry (PIIE) May 9, 2022
European policymakers must devise ways to protect consumers and businesses from economic hardship resulting from the war in Ukraine. This PIIE Chart lays out short- and long-term effects of the war, difficulties including loss of exports to Russia, the fallout of sanctions, and the humanitarian crisis of dealing with millions of refugees.

Fed's Kashkari Reveals an Uncomfortable Truth
Lisa Abramowicz (Bloomberg Opinion) May 9, 2022
The head of the central bank's Minneapolis branch lays bare the risks to the U.S. economy from China's lockdowns and a lingering war in Ukraine.

The Billionaire Raj?
Amit Tyagi (Project Syndicate) May 9, 2022
As India's economy continues its upward growth trajectory, wealth and income inequality have become more pronounced. But the country remains less unequal than many of its peers, and rising inequality may be a small price to pay for the overall reduction in poverty.

The Fed Waves Its Wand
James K. Galbraith (Project Syndicate) May 9, 2022
By announcing its largest rate hike in two decades, the US Federal Reserve has sent precisely the signal that inflation hawks and moneylenders wanted to hear. Even better, the Fed no longer has to worry about the "transitory vs. persistent" debate, because it will get credit for a decline in inflation either way.

A Better Globalization Might Rise from Hyper-Globalization's Ashes
Dani Rodrik (Project Syndicate) May 9, 2022
With the end of post-1990s hyper-globalization, scenarios for the world economy run the gamut. In the best case, achieving a better balance between the prerogatives of the nation-state and the requirements of an open economy might enable inclusive prosperity at home and peace and security abroad.

Locking China Out of the Global Order Could Backfire
Robert A. Manning (FP) May 9, 2022
Washington is wrong to assume Beijing is incapable of accommodation.

Current Recession Risk According to the Yield Curve
Michael D. Bauer and Thomas M. Mertens (FRBSF Econ Letter) May 9, 2022
The slope of the Treasury yield curve is a popular recession predictor with an excellent track record. The two most common alternative measures of the slope typically move together but have diverged recently, making the resulting recession signals unclear. Economic arguments and empirical evidence, including its more accurate predictions, favor the difference between 10-year and 3-month Treasury securities. Recession probabilities for the next year derived from this spread so far remain modest.

You are what your real fed funds rate says you are
Richard Bernstein (FT) May 10, 2022
Timid US central bank is still very far from hawkish with policy benchmark deep in negative territory after taking into account inflation.

Emerging markets hit by 'toxic' mix of rising rates and slower growth
Tommy Stubbington (FT) May 10, 2022
Currencies such as China's renminbi fall sharply as risks mount for developing economies.

Fed Confronts Why It May Have Acted Too Slowly on Inflation
Jeanna Smialek (NYT) May 10, 2022
Central bankers have been asking whether they should have reacted faster to rising inflation last year — and are learning from the recent past. s

Dollar rally could signal trouble for Asia
William Pesek (AT) May 10, 2022
The US currency was supposed to be on life-support right about now. With inflation surging, Washington's debt topping US$30 trillion, politics as polarized as ever and governments from China to Russia to Saudi Arabia searching for alternatives, it was almost certain to tank. Yet, the opposite is happening as capital zooms out of the yuan and yen into greenbacks.

Xi Jinping Scrambles as China's Economy Stumbles
Kevin Rudd (WSJ) May 10, 2022
His recipe for stagnation: Hostility to the private sector, friendship with Russia, and 'zero Covid.'

Made-in-China PC Rule Won't Advance Nation's Tech Prowess
Tim Culpan (Bloomberg Opinion) May 10, 2022
Requiring government computers to be sourced locally probably will boost domestic sales, but it won't do much to spur development of advanced technologies.

Does Your Country Really Need Digital Cash?
Andy Mukherjee (Bloomberg Opinion) May 10, 2022
Everyone's jumping on the bandwagon. But it all depends if your economy is more like Poland's or Peru's.

Shaping a Marshall Plan for Ukraine
Barry Eichengreen (Project Syndicate) May 10, 2022
The postwar Marshall Plan provided Europe with the finance not only to rebuild itself, but also to leapfrog a generation technologically. Ukraine's reconstruction offers a similar opportunity, but only if the most relevant features of the Marshall Plan are fully appreciated.

The West Has Got Its Russia Sanctions Wrong
Arvind Subramanian and Josh Feldman (Project Syndicate) May 10, 2022
Russia's illegal invasion of Ukraine can and should be countered by an economic response that is principled, effective, fair, and legal. The West can achieve such a response by replacing its current sanctions with collective restrictions on exports of goods to Russia.

Trade policy cannot fix America's inequality problem
Alan Beattie (FT) May 11, 2022
The Biden administration can't protect its way to prosperity in a post-industrial economy.

How risk managers can survive a 'perfect storm'
Evgueni Ivantsov (FT) May 11, 2022
It is vital to strengthen operational resilience and crisis management frameworks.

Survive inflation by balancing your portfolio
Simon Edelsten (FT) May 11, 2022
Know when to hold 'em, know when to fold 'em, so you are ready for an investment upturn.

Inflation Stays in the Heights
WSJ View May 11, 2022
The policy mix of blowout government spending and easy money is punishing workers.

The trade deficit is up again. No worries.
Jeff Jacoby (BG) May 11, 2022
The dollars Americans spend on imports aren't 'lost.' They are exchanged for goods and services that strengthen our economy and elevate our lifestyle.

How the Ukraine Conflict Is Impacting India's Economy
Venkatachalam Anbumozhi (BRINK) May 11, 2022
Two months into the Ukraine-Russia conflict, India's business leaders and policymakers are seriously evaluating the impact of this crisis just as business has started to come out of the pandemic.

Protectionism Is a Mounting Threat to Global Growth
Bloomberg View May 11, 2022
A "post-globalization" world would be poorer, less innovative, and more vulnerable to conflict. Free trade needs a spirited defense.

Market Is Still in the Denial Stage About Inflation
Jonathan Levin (Bloomberg Opinion) May 11, 2022
The latest consumer price index confirmed that rising prices have spread from goods to services and indicates a long journey back to stability.

Central Banks Can't Fend Off Stagflation Alone
Marcus Ashworth (Bloomberg Opinion) May 11, 2022
Fiscal and monetary policy makers need to work in harmony to address what's ailing the global economy.

The Fed Needs to Get Real About Interest Rates
William C Dudley (Bloomberg Opinion) May 11, 2022
Sugarcoating the outlook will only complicate its job and undermine its credibility.

Tesla Is Hedging Its Global Supply Chain Bets
Anjani Trivedi (Bloomberg Opinion) May 11, 2022
Elon Musk is hunting for new Asian production hubs for his EVs. Indonesia looks like the clear winner, while India appears to have missed the boat.

Sterling's Drop to Parity With the Dollar Is a Growing Risk
John Authers (Bloomberg Opinion) May 11, 2022
Traders fear that high inflation and weak economic growth will make it impossible to keep the UK currency from dropping further.

Good Inflation News from the Bond Market
J. Bradford DeLong (Project Syndicate) May 11, 2022
With commentators offering increasingly dismal warnings about the inflation situation in the United States, one might think that the US Federal Reserve has failed completely at its primary task. But the bond market is telling a different story, and there is no reason to think that it is driven by doves.

The effect of China's two-child policy on household savings
Scott Baker, Efraim Benmelech, Zhishu Yang, and Qi Zhang (VoxEU) May 11, 2022
China's high household savings rate remains a puzzle, with potential explanations including demographic, policy, and financial causes. This column investigates China's savings rate using individual income and spending transactions linked to demographic characteristics and financial information on loan applications and credit availability. The authors match bank customers to administrative records covering marriage and births to obtain a unique insight into consumption and savings patterns around important life events. The results point to income growth, financial instability, and credit access, rather than directives such as the one-child policy, as the primary drivers of high savings among Chinese households.

Shocks, international trade, and diversification
Ting Lan, Davide Malacrino, Adil Mohommad, Andrea Presbitero, and Galen Sher (VoxEU) May 11, 2022
Trade in goods has rebounded quickly from the pandemic, while trade in services has not. This column finds that the pandemic broke the old trade patterns and that lockdowns had unintended international spillovers. Although global value chains have adapted, ongoing supply disruptions and the risk of future adverse shocks point to the need for more resilient value chains. The authors argue that in contrast to those calling for reshoring, a better way to build resilience is to diversify away from domestic sourcing of inputs and make it easier for producers to substitute between inputs supplied by different countries.

Xi's strongman tactics need flexibility to tackle Covid
FT View May 12, 2022
The economic fallout of China's lockdowns looks set to be profound.

Brexit reality bites as stagflation looms
Adam Posen (FT) May 12, 2022
Bank of England will have to raise rates higher than it has forecast and even more than markets have priced in.

Warnings From the Crypto Crash
WSJ View May 11, 2022
As the Federal Reserve withdraws liquidity to fight inflation, stablecoins won't be the last casualties.

Strong Policies Help Korea Navigate Uncertain Times
Martin Kaufman and Krishna Srinivasan (IMF) May 12, 2022
Korea's economic recovery has been resilient, but inflation has been rising and the war in Ukraine and developments in China continue to weigh on the outlook for exports and activity.

The Fed Shouldn't Rule Out Faster Tightening
Bloomberg View May 12, 2022
If inflation keeps refusing to cooperate, the central bank will have to be more forceful.

The Rising Dollar Is Wreaking Havoc With US Trade
Gary Shilling (Bloomberg Opinion) May 12, 2022
A strong currency may be in America's national interests over the long term, but right now the hit to exports is a concern.

A Recession Won't Be as Scary as It Sounds
Allison Schrager (Bloomberg Opinion) May 12, 2022
While the Fed's inflation fight could throw the economy into reverse, a mild slowdown now might help avoid a deeper downturn later.

If This Is Another Dot-Com Bubble, the Cloud Has a Silver Lining
Trung Phan (Bloomberg Opinion) May 12, 2022
Digital transformation is still in an early phase, which means many hard-hit cloud and "software-as-a-service" stocks could bounce back in years to come.

To Fight Inflation, Fight Protectionism
Pinelopi Koujianou Goldberg (Project Syndicate) May 12, 2022
Surging inflation has made it much more difficult for US President Joe Biden's administration to justify a continuation of Donald Trump's protectionist policies. Though "openness" and "globalization" may have fallen out of political favor, free trade remains sound economic policy.

The Great Inflation Trade-Off
Hippolyte Fofack (Project Syndicate May 12, 2022
Leading central banks are now deploying tools that should help to contain growing price pressures. But these measures will impose a high economic cost, and could push the most vulnerable economies into recession.

Supplying the Green Transition Must Be Fast and Fair
Mary Robinson (Project Syndicate) May 12, 2022
Achieving global climate goals will require a quantum leap in investments to secure sufficient supplies of key minerals needed for clean-energy technologies. But while these inputs can greatly accelerate emission-reduction efforts, protecting human rights when extracting them is an essential condition for climate justice.

Seizures of foreign exchange reserves will not weaken the dollar's role as dominant reserve currency
Michael Dooley, Peter Garber, and David Folkerts-Landau (VoxEU) May 12, 2022
Recent sanctions imposed by the US on Russia have called into question the US dollar's dominant role as a reserve currency. This column argues that sanctions will, in fact, reinforce the dollar's dominance rather than weakening it. It emphasises the importance of 'collateral' demand for reserves, especially by developing countries. Countries which choose to exit the dollar bloc will have restricted ability to reassure foreign investors, which could impact a growth strategy that involves participation of centre country capital.

Skill-biased production makes high-skill workers more efficient in rich countries
Federico Rossi (VoxEU) May 12, 2022
How does the productivity of different types of workers vary across countries? This column uses micro data from countries at different levels of development to document that highly educated workers are relatively more productive in rich countries. Exploiting variation in the skill premia of foreign-educated migrants, the author concludes that this is mostly due to the technological environment in rich countries being more complementary to high-skill labour.

The Cryptocurrency Crash Is Replaying 2008 as Absurdly as Possible
David Gerard (FP) May 12, 2022
Substitute dollars backed by almost nothing are taking down the market.

Why foreign private equity is eyeing deals in Japan
Leo Lewis (FT) May 13, 2022
The country increasingly represents the safest choice for a regional hub.

Reasons why the tech stock crash may be far from over
Richard Waters (FT) May 13, 2022
The axe is hanging over high-growth companies with stretched valuations.

The Stock Market, After Soaring for Years, Returns to Earth
Michael Corkery (NYT) May 13, 2022
The market has been producing double-digit returns for investors, even at moments of great national strife. But the party has ended and it may be a long time before it begins again.

Malaysia squandering a palm oil price windfall
Nile Bowie (AT) May 13, 2022
Indonesia's controversial ban on palm oil exports has sent global edible oil prices soaring, creating a supply gap that Malaysia is in a pole position to fill. But ongoing labor shortages due to more than two years of Covid-19 border curbs have left the country ill-equipped to fully capitalize on a golden opportunity to expand its market share.

The Indian economy is being rewired. The opportunity is immense
Economist May 13, 2022
And so are the stakes.

The Inflation Tail Is Wagging the Policy Dog
Daniel J. Arbess (Project Syndicate) May 13, 2022
Now that markets have finally been conditioned for interest-rate hikes, the danger of financial over-tightening looms large. Just as central bankers have embarked on a long-overdue process of balance-sheet unwinding, global developments have pushed the economy to the edge of recession.

Beware a Global Economy with Little Fires Everywherehttps://www.project-syndicate.org/commentary/ukraine-war-economic-consequences-for-developing-countries-by-mohamed-a-el-erian-2022-05
Mohamed A. El-Erian (Project Syndicate) May 13, 2022
Rich countries have shown impressive unity in helping Ukraine counter the Russian invasion. They now need to demonstrate the same level of resolve to prevent the global economic fallout from the conflict from destroying the lives or livelihoods of many of the world's most vulnerable people.

Algorithmic stablecoins and devaluation risk
Amit Chaudhary and Ganesh Viswanath-Natraj (VoxEU) May 13, 2022
On 10 May 2022, the price of TerraUSD, an algorithmic stablecoin operating on the Terra blockchain, fell and it lost its peg to one US dollar. Using the devaluation of the TerraUSD peg as a case study, this column shows how algorithmic stablecoins are vulnerable to speculative attacks when the system is under-collateralised. The authors point to solutions – stable collateral and over-collateralisation – to stabilise the peg.

Analysing cost-push inflation using world input-output tables
Guillaume Daudin and Violaine Faubert (VoxEU) May 13, 2022
The rise of global value chains has led to a greater use of input-output tables to study international linkages. This column analyses cost-push inflation using world input-output tables. In the light of the recent surge in commodity prices, it explores which countries are most vulnerable to energy cost-push inflation and documents the large exposure of Eastern and central European economies to a rise in Russian hydrocarbon prices. Input-output tables are used to document the heterogeneous reactions of consumer prices to exchange rate variations across countries, reflecting differences in foreign product content of consumption and intermediate products.

A central bank view of reforming Europe's fiscal framework
Stephan Haroutunian, Sebastian Hauptmeier, Nadine Leiner-Killinger, and Philip Muggenthaler (VoxEU) May 13, 2022
The economic landscape has changed dramatically since the European fiscal rules were designed some 30 years ago. This column contributes to the debate on reform by proposing a two-tier fiscal framework combining an expenditure rule that accounts for the ECB's inflation objective with a lower speed of adjustment under the Stability and Growth Pact's debt rule. Counter-cyclicality may be improved by automatic modulation of adjustment requirements, creating fiscal space when domestic inflation is low and constraining more when inflation is above target. The link to the debt anchor ensures a gradual phasing-in of debt reduction in the aftermath of COVID-19.

It's Africa's Century—for Better or Worse
Adam Tooze (FP) May 13, 2022
Asia gets the attention, but the real economic revolution is the inevitable growth of an overlooked continent.

Where the next financial crisis could come from
John Dizard (FT) May 14, 2022
Private equity has become a group of self-dealing oligarchs.

Junk bond party starts to wind down
Joe Rennison (FT) May 14, 2022
Investors are reassessing the ability of high-yield issuers to withstand the strained economic outlook.

How Do Higher Interest Rates Bring Down Inflation?
Jeff Sommer (NYT) May 14, 2022
Our columnist is responding to readers' questions. This week, he focuses on inflation, with the help of a bond maven and a Nobel laureate.

Even outside America, inflation is starting to look entrenched
Economist May 14, 2022
Five indicators suggest Anglophone countries are suffering the most.

China's extraordinary export boom comes to an end
Economist May 14, 2022
Covid-related supply bottlenecks meet slowing foreign demand.

India is likely to be the world's fastest-growing big economy this year
Economist May 14, 2022
Can the expansion continue?

Tech bubbles are bursting all over the place
Economist May 14, 2022
Some more loudly than others.

The Fed Sure Sounds as If It Expects a Recession
Robert Burgess (Bloomberg Opinion) May 14, 2022
The central bank chief's confidence that the economy can avoid a downturn has taken a beating in just more than a week.

Housing Defies Fed's Campaign to Control Inflation
Jonathan Levin (Bloomberg Opinion) May 14, 2022
Home prices just keep rising despite surging mortgage rates, and they are baked into indexes that track rising prices.

Assortative mating and the wealth inequality debate
Luigi Guiso and Luigi Pistaferri (VoxEU) May 14, 2022
The literature on assortative mating has largely focused on whether children of wealthy parents tend to marry children of similarly wealthy parents. Using data from Norway, this column shows that people tend to match based on their own pre-marriage wealth, not their parent's wealth, and that individuals also match based on their personal returns to wealth. Among wealthy couples, the partner with the highest pre-marriage return tends to manage the household's assets, allowing the households to grow their assets even faster over time and boosting wealth concentration.

The Slow Crash on Wall Street Likely Isn't Over Yet
John Cassidy (New Yorker) May 14, 2022
As tens of millions of Americans watch the values of their retirement savings decline, many of them are asking what is causing the sell-off and when it will end.

Stablecoins need to be tethered by real-world rules
FT View May 15, 2022
Shocks to the cryptosphere's vital cog can reverberate to financial markets.

Global growth is slowing, but not stopping—yet
Economist May 15, 2022
The Chinese and Russian economies, though, are probably shrinking.

Biden Can Do Much More to Fight Inflation
Matthew G Yglesias (Bloomberg Opinion) May 15, 2022
The president says that slowing the rise in prices is his top priority, but he's not running his administration that way.

Magic Prices Did Warn of India's Sticky Inflation
Andy Mukherjee (Bloomberg Opinion) May 15, 2022
Easy-to-remember retail prices are important to both budget-conscious consumers and brands. When a 10-rupee detergent starts selling for 12, policy makers are already looking at entrenched inflation.

Let the Fed put money where it is really needed
Rana Foroohar (FT) May 16, 2022
Inflation pressures and asset bubbles are a sign that the central bank has been distracted from its core mission.

EU's proposed crypto regulations are flawed
Karel Lannoo (FT) May 16, 2022
Light-touch rules on digital assets and exchanges leave investors vulnerable and increase misunderstanding.

Food insecurity is a bigger problem than energy
Megan Greene (FT) May 16, 2022
Targeted cash and expertise are needed in the worst-hit areas, rather than sending food stocks.

Falling Markets Will Crush Government Budgets
Red Jahncke (WSJ) May 16, 2022
Tax revenue from capital gains is about to dry up. Are federal and state officials ready for it?

China's 'zero-Covid' plan makes 5.5% growth a reach
William Pesek (AT) May 16, 2022
China's dream of 5.5% growth this year sure sounded grand while it lasted. Covid-19 has a different trajectory in mind for Asia's biggest economy. The damage from President Xi Jinping's "zero-Covid" policy went from theoretical to official with news that industrial output fell 2.9% in April from a year ago, far surpassing predictions from a gentler 0.5% contraction.

Pakistan facing bankruptcy as the economy crumbles
FM Shakil (AT) May 16, 2022
Foreign exchange reserves are falling, food inflation is spiraling and the rupee has been on a slippery slope.

The new global tax deal is bad for development
Julie McCarthy (Brookings) May 16, 2022
A missed opportunity to boost development finance.

What Will Happen When the ECB Stops Buying Euro Bonds?
Alex Privitera (BRINK) May 16, 2022
The European Central Bank is on the verge of ending its long-standing bond-buying program. While its stated aim is to contain inflation, the ECB also has to try to prevent financial fragmentation within the euro area, represented by a widening of spreads in sovereign bond yields.

What reducing inflation means for BoE independence
Peter Sedgwick (OMFIF) May 16, 2022
With inflation possibly approaching 10%, the Bank of England faces its toughest test since gaining independence in 1997. There is no post-war precedent for UK inflation on this scale being reduced without the government taking the crucial policy decisions – mainly to raise interest rates substantially – and coping with the political pressures when policy changes turn out to be unpopular.

The Euro Will Survive Falling Below Parity With the Dollar
Marcus Ashworth (Bloomberg Opinion) May 16, 2022
The common currency's decline is a collective problem that's unlikely to stress the union.

It's a Good Time to Think About Stagflation Havens
John Authers (Bloomberg Opinion) May 16, 2022
With China contracting and recession the dominant risk, the market is offering some generous odds.

Credit Market Pain Is Too Muted to Save Stocks
Lisa Abramowicz (Bloomberg Opinion) May 16, 2022
The bar is much higher for the Federal Reserve to back down from its plans to aggressively raise interest rates.

Fiscal Capture at the ECB
Willem H. Buiter (Project Syndicate) May 16, 2022
By using all the means at its disposal to support potentially debt-distressed member states, the European Central Bank is not merely serving as a market maker of last resort. Rather, it is engaged in fiscal-support operations, potentially to the detriment of its mandated objectives.

The IMF Is Still Behind the Times on Capital Controls
Joseph E. Stiglitz and Jonathan Ostry (Project Syndicate) May 16, 2022
Although the International Monetary Fund's newly revised policy framework on capital controls makes some improvements on what came before, it is still likely to do more harm than good. Real-world experience and advances in economic theory have shown that the IMF's suspicions about such policies are misplaced.

Political power and market power: Evidence from mergers
Bo Cowgill, Andrea Prat, and Tommaso Valletti (VoxEU) May 16, 2022
Industry concentration leads to increased market power, but can it also lead to increased political power? This question, first asked by Brandeis in 1914, is receiving renewed attention. This column investigates the effect of a merger on the amount of political activity of the merging firms. While theoretical predictions are ambiguous, US data from the past 20 years indicate that the average merger involving listed companies is associated with a 30% increase in lobbying spending.

Sanctions and the exchange rate
Oleg Itskhoki and Dmitry Mukhin (VoxEU) May 16, 2022
Despite an increasing number of sanctions imposed on the Russian economy since its invasion of Ukraine in February 2022, the ruble has appreciated back to its pre-war level. This column argues that the prevalence of import over export sanctions and the financial repression imposed in Russia, which lowered the local demand for foreign currency, have driven the appreciation. Despite the opposite effects on the exchange rate, the sanctions on imports and exports are equivalent in terms of their impact on consumption, welfare, and government fiscal losses. Nonetheless, the level of the exchange rate remains relevant for imports, savings, and monetary policy.

The dollar's rapid rise increases risks for global economy
Mohamed El-Erian (FT) May 17, 2022
Dangers are particularly acute for developing countries already facing number of crises.

The EU cannot be a green island in a dirty world
Heather Grabbe (FT) May 17, 2022
Europe must help other countries to change their economic systems and reduce emissions.

Poor Countries Face a Mounting Catastrophe Fueled by Inflation and Debt
Peter S. Goodman, Ruth Maclean, Salman Masood, Elif Ince, Flávia Milhorance, Muktita Suhartono, and Brenda Kiven (NYT) May 17, 2022
Russia's war in Ukraine is combining with a global tightening of credit and an economic slowdown in China to sow misery in low- and middle-income countries.

Congress Has a Stake in the Dollar's Integrity
Judy Shelton (WSJ) May 17, 2022
The Fed's independence gives Americans no democratic recourse when the currency is debased.

Healing the Pandemic's Economic Scars Demands Prompt Action
Mehdi Benatiya Andaloussi, Lone Engbo Christiansen, Ashique Habib and Davide Malacrino (IMF) May 17, 2022
Challenges facing emerging market workers and students everywhere could turn to long-term damage.

The Global Safety Net Against Hunger Is Frailer Than You Think
David Fickling (Bloomberg Opinion) May 17, 2022
Political upheaval can accelerate food insecurity, particularly when the system is based on such shaky foundations.

The Oil Market Needn't Fear a Calamitous US Recession
Javier Blas (Bloomberg Opinion) May 17, 2022
A quick history lesson suggests that an economic slowdown might not be too terrible.

The City of London Doesn't Need a Regulatory Reboot
Paul J Davies (Bloomberg Opinion) May 17, 2022
Britain remains a global leader in financial services despite Brexit. Keeping its reputation for safety and strong rules should be its focus.

Understanding the unemployment and welfare effects of the China shock
Andres Rodríguez-Clare, Mauricio Ulate, and Jose P. Vasquez (VoxEU) May 17, 2022
Concerns about international trade have grown, as recent studies document a negative effect of Chinese import competition on US labour markets. This column provides a new framework to explain this observation, which relies on the presence of downward nominal wage rigidity in US labour markets. The increased competition from China improves US terms of trade, but nominal wage frictions prevent the labour market from adjusting, so that both employment and labour force participation fall in the short run. The welfare implications vary substantially across states, but the favourable terms-of-trade shock drives a positive overall effect.

Another Global Recession?
Jim O'Neill (Project Syndicate) May 17, 2022
Between falling real incomes in advanced economies, China's weakening outlook, and the uncertainties stemming from Russia's war in Ukraine, there is more than enough reason to worry that the post-pandemic recovery is giving way to a downturn. But there is still much that policymakers could do to mitigate the blow.

Realizing Africa's Sustainable Energy Future
Michael R. Bloomberg and Damilola Ogunbiyi (Project Syndicate) May 17, 2022
Without international support, including investment at scale, African countries will not be able to expand energy access to all and still reach their climate goals. The alternative – an increased reliance on coal – would have devastating consequences.

The Great Crypto Grift May Be Unwinding
John Cassidy (New Yorker) May 17, 2022
As an inevitable crash occurs, many of the swindles and alleged swindles are coming to light.

The World Needs an Economic NATO
Bruce Stokes (FP) May 17, 2022
Russia's war has made sanctions a powerful tool of statecraft. It's time to formally enshrine them.

Beating inflation will require more than rate rises
FT View May 18, 2022
The Bank of England governor has shown how not to manage expectations.

Divest fossil fuels — the time for engagement is over
Daniel Godfrey (FT) May 18, 2022
Investors must use their collective might to accelerate the transition to renewable energy.

India's export shock exacerbates a global food crisis
Alan Beattie (FT) May 18, 2022
Wheat prices are soaring after government plans to feed the world fell apart under domestic pressure.

The Next Emerging-Market Crisis?
WSJ View May 18, 2022
Developing economies face a perilous return to monetary normal.

COVID-19 and poverty vulnerability
Fabian Mendez Ramos and Jaime Lara (Brookings) May 18, 2022
Beyond poverty headcount: Macro-poverty vulnerability.

This Crypto Winter Will Be Long, Cold and Harsh
Jared Dillian (Bloomberg Opinion) May 18, 2022
In previous bear markets, people wondered if digital currencies would rebound. Now, they wonder if even the blockchain will survive.

Workers in Japan Should Ask Their Bosses for a Raise
Gearoid Reidy (Bloomberg Opinion) May 18, 2022
Rising inflation and the weak yen are seen as a crisis, but in fact provide a rare opportunity for real change in wage growth.

Will US Inflation Lead to Recession?
Michael R. Strain (Project Syndicate) May 18, 2022
While some economic indicators suggest that the recovery remains on track, others show that consumers may be stalling out, and that households and businesses are becoming increasingly pessimistic. The US Federal Reserve will have to respond more nimbly to economic softening than it did to strengthening in 2021.

Have We Reached the Limits to Growth?
Michael Jacobs and Xhulia Likaj (Project Syndicate) May 18, 2022
The Club of Rome's landmark 1972 report warning of the potentially catastrophic consequences of exponential economic growth was widely dismissed by mainstream economists at the time. Had that not happened, The Limits to Growth would not be required reading today.

Global insecurity is no reason to divest from the WTO
Arancha González Laya (FT) May 19, 2022
International co-operation remains vital for protecting against everything from climate change to recurring pandemics.

Biden has the means to reduce inflation. Why isn't he acting?
Fareed Zakaria (WaPo) May 19, 2022
The repeal of most or all of former president Donald Trump's tariffs would be the single most effective way of reducing inflation in the near future.

China's turbo boosts come too late for 2Q growth
Jeff Pao (AT) May 19, 2022
China's central government urged the top 10 provinces with the strongest gross domestic products to launch all possible measures this month to boost China's economic growth in the second quarter as Beijing pushes to achieve its full-year GDP target of 5.5%, which analysts and forecasters increasing say the country will not be able to hit even with more supportive measures.

Congress shouldn't let global tax deal fail
BG View May 19, 2022
The United States must get on track to complying with the international tax agreement that it's trying to sell to the rest of the world.

The coming food catastrophe
Economist May 19, 2022
War is tipping a fragile world towards mass hunger. Fixing that is everyone's business.

Why Countries Must Cooperate on Carbon Prices
Jean Chateau, Florence Jaumotte and Gregor Schwerhoff (IMF) May 19, 2022
An international floor price for carbon could speed the world's transition to green energy without compromising countries' competitiveness.

Welcome to Our Be-Careful-What-You-Wish-For Economy
Conor Sen (Bloomberg Opinion) May 19, 2022
Just six months ago, economists were arguing urgently that the US needed to slow growth and deflate an eruption of market bubbles. So it's all going to plan, right?

Stock Selloff May Be Entering a New Phase
Mohamed A El-Erian (Bloomberg Opinion) May 19, 2022
Worries about growth and earnings are joining concerns about higher interest rates and tightening financial conditions.

Searching for the Least Bad Version of Monetary Hell
Daniel Moss (Bloomberg Opinion) May 19, 2022
Central bankers have to pick between the immediate fight against inflation and the looming battle to stave off a recession.

China's Golden Tech Grab
Angela Huyue Zhang (Project Syndicate) May 19, 2022
The authorities' effort to discipline Chinese tech firms over the last 18 months has been clumsy and highly costly, featuring a raft of opaque and unpredictable regulations. But the approach the government seems poised to replace it with is not much better.

The Global Hunger Crisis Is Here
Seta Tutundjian (Project Syndicate) May 19, 2022
A more resilient, sustainable, and equitable food system must be a pillar of any climate mitigation or adaptation agenda. But the barriers to building one should not be underestimated, especially for countries and regions where soil is poor, land has little agricultural value, and other natural resources, such as water, are limited or degraded.

Measuring robot quality
Ippei Fujiwara, Ryo Kimoto, Shigenori Shiratsuka, and Toyoichiro Shirota (VoxEU) May 19, 2022
A large literature explores the implications of the introduction of robots into the workplace for the labour market, yet few studies exist which measure robot quality over time. This column uses data from the Japan Robot Association and the Bank of Japan to document a significant decline in the improvement in robot quality in Japan in the last decade. The differences in the growth rates of robot quality between the 2000s and 2010s are large, at around -3 percentage points per year.

Remote wages in a globalised labour market
Agostina Brinatti, Alberto Cavallo, Javier Cravino, and Andres Drenik (VoxEU) May 19, 2022
Web-based job platforms that match employers and workers around the world to trade tasks which are delivered online are becoming increasingly popular. This column uses a new dataset from one of the largest job platforms to examine remote wages across locations and offshorability of work. Remote wages are more equalised than local wages across countries, but wage gaps across locations are still large. Outside the US, local-currency remote wages are strongly affected by fluctuations in the dollar exchange rate. Whether a job is performed remotely is an imperfect proxy for whether a job can be easily offshored.

The Goldilocks crisis may have arrived for crypto
Gillian Tett (FT) May 20, 2022
Key player and policymakers must now embrace reform to weed out the bad, while retaining some good.

What are investors supposed to trust in now?
Merryn Somerset Webb (FT) May 20, 2022
Equity and bond markets appear to be imploding at the same time.

Investors spooked as gloom grips markets
Katie Martin (FT) May 20, 2022
Even veterans accept we are at a historic juncture as inflation surges.

A Weak Euro Heads to an Uncomfortable Milestone: Parity With the Dollar
Eshe Nelson (NYT) May 20, 2022
The euro hasn't fallen below the one-to-one exchange rate with the U.S. dollar for two decades. But as economic risks grow, more analysts predict deeper lows for the shared currency.

Macro realities offer yuan bulls hope against dollar
William Pesek (AT) May 20, 2022
Currency traders betting on a rising dollar and sliding yuan may be missing a significant shift in the trajectories of the world's two biggest economies. Already, there are signs the dollar's 6.4% rise versus the yuan is losing momentum, and it's no mystery why. Widespread recession talk in the US is reaching fever-pitch dimensions while China is hitting the economic gas.

Biden shrugs off ASEAN's free trade mantra
Nile Bowie (AT) May 20, 2022
Biden told Southeast Asian leaders that strengthening US ties with ASEAN is "at the very heart" of his foreign policy strategy. But absent an economic alternative to Beijing's various big-ticket initiatives, the administration's Indo-Pacific Strategy risks being viewed through the prism of security and what some regard as an effort to geopolitically contain China.

Social Unrest is Rising, Adding to Risks for Global Economy
Philip Barrett (IMF) May 20, 2022
Although social unrest remains low relative to pre-pandemic levels for now, the lifting of pandemic-era restrictions and the continued cost-of-living squeeze mean that protests may yet increase. This could impose significant economic costs.

Reasons to be optimistic about China's recovery
Andy Rothman (OMFIF) May 20, 2022
With Covid-19 in retreat, the Chinese government has an opportunity to return to a more pragmatic approach to public health and the economy. Once the lockdowns are lifted, significant stimulus is likely to be introduced, which should lead to a second-half recovery. Soon after people are released from lockdowns, expect the government to initiate a major stimulus programme, designed to support a visible economic recovery by the time of the Party Congress in autumn this year.

America, China, Russia and the Avalanche of History
Niall Ferguson (Bloomberg Opinion) May 20, 2022
The world doesn't move in cycles or with a grand design. Echoes of the 1970s remind us that one disaster often begets others.

BOE Governor Proves Inflation Targeting Is a Bad Idea
Richard Cookson (Bloomberg Opinion) May 20, 2022
The lesson is that central banks should instead have a much broader and vaguer mandate of protecting the internal and external value of their currencies.

Stagflation Is Looming, Right? Wrong, Economists Say
Matthew A Winkler (Bloomberg Opinion) May 20, 2022
The headlines shouting "inflation" and "contraction" are contradicted by a consensus of forecasting professionals who expect price growth to abate and business to hold up nicely.

Impacts of firm global value chain participation on productivity
Shujiro Urata and Youngmin Baek (VoxEU) May 20, 2022
Participation in global value chains is commonly seen as an important driver of productivity growth. This column uses Japanese firm-level data to estimate the productivity-enhancing impacts of participation. On average, firms that form part of global value chains are found to exhibit higher productivity than non-participating firms. In addition, longer partitipation in strengthens the productivity-enhancing effects. Policymakers should support firms by protecting intellectual property rights, ensuring competition, and lowering costs and risks associated with global value chain participation.

How Crypto Disappeared Into Thin Air
James Surowiecki (New Yorker) May 20, 2022
When a currency's value is based on belief alone, it's liable to evaporate.

The impact of institutions on innovation
Alexander Donges, Jean-Marie Meier, and Rui Silva (VoxEU) May 20, 2022
A large part of the world operates under oligarchic and authoritarian regimes, where access to economic opportunities is not offered to all citizens. This column discusses the impact of such 'extractive institutions' in stifling innovation and future economic growth. Using novel hand-collected data, it documents that 'inclusive institutions', which promote equal access to economic opportunities, are a first-order determinant of innovation. Geographical regions with more inclusive institutions are able to produce more than twice as much innovation (proxied with patents per capita) as regions with worse institutions.

The eternal dream of automatic money
Brendan Greeley (FT) May 21, 2022
A currency that cannot be corrupted by bad decisions is not what humans really want.

Pessimism engulfs the Chinese economy as foreign investment fades
James Kynge (FT) May 21, 2022
The unpredictable outlook for many multinationals may herald a shift in how the global economy works.

The Fed's Latest Housing Bubble
Mark Thornton (Mises Wire) May 21, 2022
After the 2008 housing bust, the government supposedly set up a fail-safe mortgage program aimed at preventing future bubbles. It failed.

For markets, inflation fears are joined by recession risks
FT View May 22, 2022
Sell-off that began with speculative tech stocks has become broader-based.

Davos and the new era of deglobalisation
Rana Foroohar (FT) May 22, 2022
Technological progress suggests the turn from globalisation can bring benefits as well as challenges.

Biden's Solar Tariff Brawl
WSJ View May 22, 2022
Democrats are fighting as demands rise for trade protectionism in the name of climate change.

Asia's ambivalence towards sanctioning Russia
Susan Thornton (EAF) May 22, 2022
In Asia, the attitude towards Russia's invasion and accompanying de-globalisation effects are viewed with more ambivalence by many.

Why We Must Resist Geoeconomic Fragmentation—And How
Kristalina Georgieva , Gita Gopinath and Ceyla Pazarbasioglu (IMF) May 22, 2022
Only international cooperation can address urgent global issues such as fixing shortages of food and other products, eliminating barriers to growth, and saving our climate.

Davos Meetings Are Full of Potential But Rarely Full of Solutions
Mohamed A El-Erian (Bloomberg Opinion) May 22, 2022
The World Economic Forum is gathering again and the list of economic problems facing the world is long and getting longer.

Sri Lanka Is a Small Preview of a Global Default Crisis
Ruth Pollard (Bloomberg Opinion) May 22, 2022
The country is already wracked with shortages. The social order may shatter if the economy isn't infused with cash soon.

Overdue reality check for Fed and markets has barely begun
Sonal Desai (FT) May 23, 2022
Investors' expectations that interest rates will not rise much may be very misguided.

Global tensions strain weak links in tech supply chains
Siddharth Venkataramakrishnan (FT) May 23, 2022
Business leaders and students must prepare for disruption to people and parts.

The threat shadow banks pose to the global economy
Ruchir Sharma (FT) May 23, 2022
This realm beyond regulators is where the next crisis will arise.

Europe must put more pressure on Russian oil exports
Christof Ruhl (FT) May 23, 2022
EU countries are better placed than others to absorb the effects of a price shock.

Debate Over Tariffs Reveals Biden's Difficulties on China Trade
Ana Swanson, Edward Wong and Alan Rappeport (NYT) May 23, 2022
Sixteen months into the Biden presidency, U.S. officials are still divided over what to do about a trade legacy left by President Donald J. Trump.

End of globalisation concerns are exaggerated
Mark Sobel (OMFIF) May 23, 2022
Russia's war against Ukraine has given rise to much discussion about the world moving towards two blocs, decoupling and the end of globalisation. While these factors will spawn geopolitical and economic changes, many of the prognostications seem exaggerated.

The 1970s Had a Big Bright Side, Too
Adrian Wooldridge (Bloomberg Opinion) May 23, 2022
For all the decade's turmoil, it was also a time of commercial and intellectual innovation and resilience.

Will the Ukraine War Revive the WTO?
Anne O. Krueger (Project Syndicate) May 23, 2022
After continuing many of Donald Trump's destructive trade policies, US President Joe Biden's administration finally seems to be changing its tune in response to Russia's war in Ukraine. But as it seeks to restore US global leadership, it will need to proceed carefully to preserve the essential principles of free and open trade.

The education–innovation gap
Barbara Biasi and Song Ma (VoxEU) May 23, 2022
Higher education programmes are essential for innovation and economic growth. This column introduces the education–innovation gap, a metric that captures the distance between education content and the knowledge frontier. Among US higher education institutions, the education–innovation gap is significantly lower for courses taught by instructors who are more active in producing research. The gap is higher in schools with students from lower socioeconomic status. On average, exposure to frontier knowledge is associated with better student outcomes.

Untangling Persistent versus Transitory Shocks to Inflation
Kevin J. Lansing (FRBSF Econ Letter) May 23, 2022
How much persistent versus transitory forces contribute to inflation influences the Federal Reserve's ability to achieve its goal of 2% average inflation over time. If elevated inflation is driven mainly by persistent shocks, then a stronger and longer-lasting policy response is likely to be needed to bring inflation back down. Recent data show that consecutive changes in monthly inflation rates have tended to move increasingly in the same direction. This pattern suggests that the contribution of persistent shocks to inflation has been rising since mid-2019.

Now is the time for stockpickers in markets
Abby Joseph Cohen (FT) May 24, 2022
Best returns can occur when a less cheerful scenario is reflected in security prices.

The Fed must act now to ward off the threat of stagflation
Martin Wolf (FT) May 24, 2022
We know from the 1970s that the time to throttle an inflationary upsurge is at the beginning.

How the great generational wealth transfer will shape our political future
Stephen Bush (FT) May 24, 2022
Asset ownership and affluence remain key predictors in explaining electoral behaviour.

Tariffs on China Throw Shade on the U.S. Solar Industry
T.J. Rodgers (WSJ) May 24, 2022
Intended to punish Chinese panel makers, the import taxes are crushing U.S. companies and consumers.

China should move reserves out of US Treasuries
Yu Yongding (AT) May 24, 2022
China has built a foreign exchange-earning economy and accumulated US$3.3 trillion in reserves over the past few decades, but such policies are outdated and need to be adjusted in the wake of the Russian-Ukrainian conflict, which has shown it is completely possible for the US to seize China's overseas assets, particularly forex reserves, if it deems it necessary.

Biden bids to win back Asia with IPEF trade gambit
Richard Javad Heydarian (AT) May 24, 2022
After almost a year of intense anticipation, Biden unveiled the much-vaunted the Indo-Pacific Economic Framework (IPEF) during his five-day visit to Asia. The new economic initiative aims to plug in the strategic gap left by the Trump administration's nixing of the Trans-Pacific Partnership Agreement (TPP) and offer economic alternatives to China.

America's new Asian economic pact: just don't call it a trade deal
Economist May 24, 2022
And China is not invited.

ECB interest rate hesitancy behind currency misalignments
Bob Bischof and David Marsh (OMFIF) May 24, 2022
The European Central Bank's hesitancy in raising interest rates to counteract spiralling inflation is compounding problems of misaligned exchange rates, intensifying disequilibrium in international current account balances. Widespread perception that the ECB is falling behind the US Federal Reserve and Bank of England in rate-tightening, by depressing the euro on the foreign exchanges, is likely to stoke further euro area inflation by raising import prices.

Brexit is driving inflation higher in the UK than its European peers after identical supply shocks
Adam S. Posen and Lucas Rengifo-Keller (PIIE) May 24, 2022
Many high-income economies are suffering 40-year highs in inflation. They all have faced the same series of major supply shocks to their economies simultaneously: reopening of the economy after the first wave of the COVID-19 pandemic in spring 2021, global supply chain disruptions for critical goods throughout the last 18 months, and energy and food price shocks caused by Russia's invasion of Ukraine in February 2022.

Middle East and North Africa's Commodity Importers Hit by Higher Prices
Jihad Azour, Jeta Menkulasi and Rodrigo Garcia-Verdu (IMF) May 24, 2022
Higher commodity prices, propelled upwards by war in Ukraine, will have a significant economic impact on the region.

ECB Abandons Strategic Ambiguity on Rate Increases
Marcus Ashworth (Bloomberg Opinion) May 24, 2022
Christine Lagarde's hawkish pivot suggests weakness disguised as strength.

Good Times for the Consumer Economy Come to an End
Andrea Felsted (Bloomberg Opinion) May 24, 2022
Americans are reining in their spending. Is the shift away from pandemic habits to blame? Or is rising inflation really weighing on households?

China Will Soon Aspire to American-Style Growth
Daniel Moss (Bloomberg Opinion) May 24, 2022
The US could outpace its economic rival for the first time in almost half-a-century. Beijng's Covid-zero approach has taken its toll, but there's more to the story.

The US Can't Beat China If It's Scared of Trade
Mihir Sharma (Bloomberg Opinion) May 24, 2022
There's a reason the Biden administration's flagship economic proposal for the Indo-Pacific has been met with disappointment and even derision in the region.

The Next Crisis to Hit Markets May Be About Liquidity
Jared Dillian (Bloomberg Opinion) May 24, 2022
It's becoming tougher to trade securities, and it's not just because the Federal Reserve is tightening monetary policy.

What Is the Fall in the Stock Market Telling Us?
John Cassidy (New Yorker) May 24, 2022
Americans are fearful of a recession, but the White House says the economy is resilient.

US influence in Asia depends on economic engagement
FT View May 25, 2022
Biden's first presidential trip to the region struggles to show a positive agenda.

We're asking the wrong questions about stablecoins
Hilary Allen (FT) May 25, 2022
Real issue is whether these crypto assets should be allowed to exist at all.

The supposed method in El Salvador's crypto madness
Gillian Tett (FT) May 25, 2022
The perspective on bitcoin looks different from an emerging market vantage.

China's premier issues stark warning on economy as growth stalls
Sun Yu, Cheng Leng, and Tom Mitchell (FT) May 25, 2022
Li Keqiang urges officials to help companies resume production after Covid lockdowns.

Saudi Arabia to use oil windfall to bolster sovereign fund
Andrew England and Samer Al-Atrush (FT) May 25, 2022
Finance minister says petrodollar surpluses could accelerate Riyadh's ambitious plans.

Time to Stop Coddling Crypto
Steve H. Hanke and Matt Sekerke (WSJ) May 25, 2022
Volatility among stablecoins has stirred calls for industry rules but proposed legislation is unlikely to end the turmoil.

IPEF will be a hard sell in the Indo-Pacific
M K Bhadrakumar (AT) May 25, 2022
The Biden administration expects that the Indo-Pacific Economic Framework (IPEF) will serve as an important tool of the US in the country's geopolitical and economic competition against China, providing provide an early warning system for supply-chain issues, encourage industries to decarbonize and offer US businesses reliable Asian partners.

Should Central Bankers Be This Clear About Interest Rates?
Daniel Moss (Bloomberg Opinion) May 26, 2022
Traditionally taciturn officials are deploying a startling degree of candor about the direction of monetary policy. They would do well to consider the pitfalls.

The Fed Is in No Mood to Take a Break on Inflation
Jonathan Levin (Bloomberg Opinion) May 25, 2022
Minutes from the central bank's May policy meeting offer no support for the market's notion of a possible pause in interest rate increases.

Jerome Powell's Volcker Deficit
Stephen S. Roach (Project Syndicate) May 25, 2022
If the US Federal Reserve wishes to avoid a return to stagflation, it must recognize the huge gulf between the level of real interest rates under former Fed Chair Paul Volcker and the current incumbent. It is delusional to think that today's wildly accommodative monetary policy can solve the worst inflation problem in a generation.

Get Ready for Reverse Currency Wars
Jeffrey Frankel (Project Syndicate) May 25, 2022
With elevated global inflation likely to persist for some time, the prospect of competitive exchange-rate appreciations is looming larger. Instead of a race to the bottom in the currency market, there may be a scramble to the top – and poorer countries will likely suffer the most.

Growing Apart: Declining Within- and Across-Village Risk Sharing in Rural China
Orazio Attanasio, Costas Meghir, Corina Mommaerts, and Yu Zheng (VoxChina) May 25, 2022
China has embarked on an ambitious campaign to close income gaps, address regional inequality and unfair social welfare provision, and make solid progress toward common prosperity by 2035. This marks a shift in focus from overall growth to promoting equitable and balanced growth. To evaluate the growing inequality during China's recent period of rapid expansion, a number of papers have documented the evolution of income inequality, especially in urban China, since the beginning of the economic reforms and opening up (Khan and Riskin 1998; Meng 2004; Meng, Gregory, and Wang 2005; Ravallion and Chen 2007; Benjamin, Brandt, Giles, and Wang 2008). Others also study the change in consumption inequality alongside income inequality (Cai, Chen, and Zhou 2010; Ding and He 2018).

Sri Lanka Is an Omen
Mark Malloch-Brown (FP) May 25, 2022
To solve a global economic unwinding, the world must learn to focus on more than one crisis at a time.

International Economic Outlook: May 2022
Nick Bennenbroek, Brendan McKenna, and Jessica Guo (WF Econ Group) May 25, 2022
With global inflation pressures remaining elevated, monetary tightening remains a dominant feature of our global economic outlook. Against that backdrop, we continue to see the Federal Reserve leading the monetary tightening theme, though we expect most other major and emerging market central banks to raise interest rates further. There are, however, two key exceptions to this monetary tightening trend. The People's Bank of China and Bank of Japan are likely to keep monetary policy accommodative going forward, and this underpins our views for a weaker Chinese renminbi and Japanese yen over the course of our forecast horizon. In China, the economy continues to face headwinds, and a decelerating Chinese economy represents a downside risk to our already below-consensus global GDP forecast. We maintain our pessimistic outlook on global economic growth and believe risks are tilted toward even slower growth than we forecast. China's economic deceleration is a key contributor to slower global growth; however, contagion risks across the emerging markets could lead to a more pronounced slowdown in the months ahead. While we now forecast a stable U.S. dollar in the short term, we continue to believe the U.S. dollar can broadly strengthen over the medium to long term. Dollar strength should be most apparent against the emerging market currencies; however, we expect the greenback to rise against many of the G10 currencies over the remainder of 2022 and into 2023.

The death of globalisation has been greatly exaggerated
Martin Sandbu (FT) May 26, 2022
So far, slowdown in cross-border activity reflects slowdown in growth.

As Russia Diverges From the Global Economy, Soviet-Style Scarcity Looms
Patricia Cohen, Eshe Nelson, Valeriya Safronova and Michael Levenson (NYT) May 26, 2022
With soaring prices and shortages of basic goods, the Russian people and businesses large and small are feeling the pinch.

How Xi Jinping is damaging China's economy
Economist May 26, 2022
Inflexible policies are trumping pragmatism.

Why investors are increasingly worried about recession in America
Economist May 26, 2022
And why the speed of the market correction offers a crumb of comfort.

Rouble strength is only surface level
Timothy Ash (OMFIF) May 26, 2022
At face value, the Central Bank of Russia is winning the currency war to defend the rouble against the impacts of western sanctions. It has reached its strongest rate for two years, making the rouble one of the best performing emerging market currencies this year. But the aggressive capital controls and policy rate hikes used in its defence are not cost-free. They will further stall economic activity, which will mean weaker growth.

Memo to the Fed: Hurry Up and Hike So We Can Slow Down
Daniel Moss (Bloomberg Opinion) May 26, 2022
New Zealand and South Korea moved early and aggressively on rates. They are starting to acknowledge the costs to the economy.

The Federal Reserve's Next Act Will Test Market Stability
Jenny Paris (Bloomberg Opinion) May 25, 2022
No one can say whether more aggressive tightening of monetary policy will disrupt the financial system's plumbing and force the central bank to alter course, as it has in the past.

Don't Bet on a Soft Landing
Nouriel Roubini (Project Syndicate) May 26, 2022
With "Team Persistent" having clearly prevailed over "Team Transitory" in the debate over the nature of today's surging inflation, the question now is whether prices can be tamed without also causing a recession. The historical evidence suggests not, leaving central banks to choose between bad and worse options.

The Death of Davos?
Carl Bildt (Project Syndicate) May 26, 2022
Gone are the glory days when the World Economic Forum's annual conference in the Swiss Alps perfectly captured the optimism and hype of the post-Cold War era of globalization. Today, the mood is decidedly darker, requiring a more clear-eyed perspective on what, if anything, can be salvaged from the recent past.

Why We Need Davos Man Back
Michael Hirsh (FP) May 26, 2022
It's fun to bash billionaires. But with the global system under assault, we need all the help we can get.

A tariff on Russian oil could pave the way to an embargo
FT View May 27, 2022
The best way to squeeze Moscow's war machine is to deprive it of energy profits.

Markets have become a minefield
Katie Martin (FT) May 27, 2022
Investors are in an extremely unforgiving mood if companies disappoint on earnings.

China's central bank faces a delicate balancing act
Zhu Ning (FT) May 27, 2022
A strong dose of monetary easing may boost short-term growth, but would risk inflating stock and housing bubbles.

Links between energy and food must be weakened
Havard Halland, Ruya Perincek, and Jan Rielander (FT) May 27, 2022
Biofuels and high fertiliser prices must not lead to a hunger catastrophe.

Bull market rhymes lead to a turn in the investing cycle
Howard Marks (FT) May 27, 2022
The influence of psychology on investors' decision-making still largely explains stock gyrations.

A good tale can tempt us to forget the truth about markets
Merryn Somerset Webb (FT) May 27, 2022
Stories have driven an unnatural division between growth stocks and value stocks.

US stock plunge has Asia bracing for a fall
William Pesek (AT) May 27, 2022
A bloodbath in US stocks wasn't high on Asia's risk list for 2022. But as Wall Street's stumble pivots from correction to death-dive territory, Asia's markets are increasingly in harm's way. The losses reverberating around the globe indicate that the biggest economy is about to go through a rough patch of unknown proportions.

Import tsunami sinks US GDP in first quarter
David P. Goldman (AT) May 27, 2022
US real gross domestic product (GDP) shrank at a 1.5% annual rate during the first quarter, more than the preliminary estimate of -1.3%, the Commerce Department reported on May 26. The worst trade performance on record took 3.2% off GDP, more than accounting for the entire drop. Nothing like this has happened before.

Mergers, Acquisitions, and Market Manias: The Fed Has Made Things Worse
Joseph Solis-Mullen (Mises Wire) May 27, 2022
As the economy begins to slow, the results of the Fed's money pumping are showing up in mergers and acquisitions.

Commodities Will Be the Next Market to Succumb
Gary Shilling (Bloomberg Opinion) May 27, 2022
The bulls may soon regret their enthusiasm as both demand and supply forces look as if they will soon start to depress prices.

How Big Finance Can Scale Up Sustainability
J. David Stewart and Henry P. Huntington (Project Syndicate) May 27, 2022
The disconnect between those developing sustainability projects and the world of traditional finance means that scaling such initiatives is not straightforward. Three steps in particular are necessary to help mobilize the trillions of dollars needed to address the ever-worsening climate crisis.

Understanding the global rise in inflation
Luca Fornaro, Federica Romei (VoxEU) May 27, 2022
Since the start of the pandemic, global demand for tradable goods relative to non-tradable services has been exceptionally high. This column argues that this unusual demand pattern can push the global economy into stagflation, driven by scarcity of tradable goods. Countries running trade deficits export high inflation abroad, while policies that boost production of tradable goods and current account surpluses act as a benign disinflationary force. Due to a free riding problem, national monetary authorities may fall into a coordination trap leading to excessively high unemployment. High energy prices exacerbate all these effects.

Technology and Finance
Darrell Duffie, Thierry Foucault, Laura Veldkamp, and Xavier Vives (VoxEU) May 27, 2022
The digitalisation of financial services presents formidable tests for incumbent financial intermediaries, firms, exchanges and regulators. The fourth report in the series on The Future of Banking examines the growing impact of technology on financial markets and institutions and identifies the key challenges in payment systems, the use of big data and trading in markets.

Reducing the US deficit will mean pain for the middle classes
Michael Strain (FT) May 29, 2022
Neither taxing the top 2 per cent nor cutting spending on low-income households will ease America's fiscal imbalance.

Where do we go from here: Inflation or recession?
Megan McArdle (WaPo) May 29, 2022
Is a recession better than high inflation?

Is the Great Sri Lanka Fire Sale About to Begin?
Ruth Pollard (Bloomberg Opinion) May 29, 2022
Getting a bailout won't be easy for the financially embattled government, while privatizing key state assets risks more turmoil.

Private equity cannot avoid the reckoning in markets
Mohamed El-Erian (FT) May 30, 2022
Both the real economy and the financial system are in a destabilising phase for both public and private investors.

Why the rich world's fertility problem will force a rethink on immigration
Stephen Bush (FT) May 30, 2022
Keeping a stable population means being more generous to families or attracting people from other countries.

It's time for Biden to lift Trump's China tariffs
WaPo View May 30, 2022
President Biden has another major lever to pull to try to help reduce inflation: removing — or at least reducing — President Donald Trump's tariffs

What a shrinking China means for the world
Xiujian Peng (AT) May 30, 2022
China's population set to contract for first time since the '60's as greying demographics start to impact its economic potential

US e-yuan ban could ignite financial war with China
Jeff Pao (AT) May 30, 2022
China is cranking up efforts to promote its digital currency – known alternately as the e-yuan, e-CNY and e-RMB – and preparing to fight a financial war as US politicians seek ways to ban and sanction the official cryptocurrency. New US draft legislation also proposes to ban the use of digital yuan apps to prevent spying and protect US citizens' data.

Why ASEAN is giving Biden's IPEF a chance
Nile Bowie (AT) May 30, 2022
US President Joe Biden formally announced his administration's Indo-Pacific Economic Framework for Prosperity (IPEF) last week, with a dozen nations – including seven from the Association of Southeast Asian Nations (ASEAN) – stepping forward to join negotiations to formalize the new and loosely defined economic pact.

Will the Russia-Ukraine war speed European fiscal integration?
Jacob Funk Kirkegaard (PIIE) May 30, 2022
The effort by Europe, the United States, and other Group of Seven (G7) members and democracies to sanction Russia and provide military and financial support to Ukraine has been driven by a mixture of idealism and self-interest. But the tragic war in Ukraine also offers the chance for the European Union itself to expand its membership while accelerating fiscal integration and internal governance, overcoming its longstanding economic and institutional reform sclerosis.

When Crypto's Tulipmania Meets The Real Economy
Lionel Laurent (Bloomberg Opinion) May 30, 2022
Regulators begin to consider how to keep DeFi from becoming the next subprime.

Dismantling the Fossil-Fuel Economy at Stockholm+50
Nikki Reisch and Lili Fuhr (Project Syndicate) May 30, 2022
If we have learned one thing in the 50 years since the 1972 Stockholm convention, it is that a future tied to fossil fuels is no future at all. To address the converging crises of climate change, biodiversity loss, and plastic pollution, participants at the upcoming Stockholm+50 conference must confront oil, gas, and coal head-on.

Global Shortages Demand Global Solutions
Kaushik Basu (Project Syndicate) May 30, 2022
Despite recent hiccups, the march of globalization will not end. Policymakers must therefore try to establish minimal global conventions and agreements to deal with shortages of food and other essential commodities.

The Decline and Fall of Davos Man
Mark Leonard (Project Syndicate) May 30, 2022
Russia's war of aggression in Ukraine loomed large at this year's annual World Economic Forum meeting in Davos, where political and business leaders once gathered to celebrate globalization and pursue more of it. Now, the world has entered a new phase of history in which geopolitics will predominate.

The Eurozone's Unusual Policy Playbook
Jean Pisani-Ferry (Project Syndicate) May 30, 2022
Since 2008, the eurozone has faced a financial crisis, a sovereign-debt crisis, and a public-health crisis. With energy prices surging, it should now brace for another trial: an adverse and deeply asymmetric supply shock.

How Global Food Crises Work
Hans-Werner Sinn (Project Syndicate) May 30, 2022
As if the immediate food shortages created by Russia's war in Ukraine were not bad enough, the disruption to this year's harvest means that the problem will become even more acute in the fall and winter. Judging by similar episodes in the recent past, widespread social unrest is sure to follow.

Rising inequality: Industries and mega firms
John Haltiwanger, Henry Hyatt, and Jim Spletzer (VoxEU) May 30, 2022
Earnings inequality has been increasing. This column uses individual US data to understand the causes of this phenomenon from the late 1990s to the late 2010s. Over 60% of the rise in labour earnings inequality is driven by growing inequality between industries, rather than within industries. Moreover, 30 out of a total of 301 industries account for nearly the entire rise in between-industry inequality. Among high-paying industries in this group, this is explained by strong increases in earnings, whereas among the low-paying industries it is driven by rising employment.

Globalisation, not localisation, is the key to post-pandemic prosperity
Maksym Chepeliev, Maryla Maliszewska, Israel Osorio Rodarte, Maria Filipa Seara e Pereira, and Dominique van der Mensbrugghe (VoxEU) May 30, 2022
Growing economic nationalism and protectionism in recent years have tested the resilience of global value chains. This column argues that policies that are supportive of rather than hostile to trade could prove critical to strengthen a recovery from the pandemic and reduce extreme poverty in developing countries. Measures to enhance trade could boost integration into global value chains, increase incomes, and lift over 21 million additional people out of poverty by 2030. A more supportive environment for trade also boosts resilience to future supply shocks by supporting diversification and widening access to raw materials, goods, and services.

Twelve propositions on the state of the world
Martin Wolf (FT) May 31, 2022
Global leaders face formidable challenges, from dizzying technological progress and geopolitical tension to climate change.

Sifting through the stock market wreckage
Maike Currie (FT) May 31, 2022
Look beyond the debate about growth versus value to focus on stock picking.

DeFi's promise of democratising finance remains a distant reality
Eswar Prasad (FT) May 31, 2022
Decentralised finance risks concentrating economic power and exacerbating existing inequities.

Europe Hits Putin Where It Hurts
WSJ View May 31, 2022
A ban on most oil imports from Russia will hit his war financing.

The European Bank of Inflation
WSJ View May 31, 2022
As eurozone prices soar, the ECB is way behind the Federal Reserve in monetary tightening.

Rhee has big plans to overhaul Korea's economy
William Pesek (AT) May 30, 2022
Rhee Chang-yong, the new Bank of Korea governor, is already displaying a sense of mission creep that could make Asia's No 4 economy better off. Less than six weeks into the job, Rhee seems to be priming South Korean officialdom for a far more visible, vocal and activist style of central banking. And it's hard not to root for the 26th man to occupy his new office.

Why oil prices are spiking again
Economist May 31, 2022
A tightening EU embargo of Russian oil is just one explanation.

The Virtue Bubble Is About to Burst. Good Riddance.
Allison Schrager (Bloomberg Opinion) May 31, 2022
Making financial decisions based on your values wasn't making the world a better place. It may have even been making it worse.

Getting Deglobalization Right
Joseph E. Stiglitz (Project Syndicate) May 31, 2022
It was clear at this year's gathering of business and political elites in Davos that the longstanding vision of a world without borders is no longer credible. Unfortunately, it was also clear that recognizing this basic truth is not the same as reckoning fully with past mistakes.

Will US Consumers Keep Spending?
Jason Furman (Project Syndicate) May 31, 2022
Even though US consumer confidence is low, consumer spending remains strong as households spend down excess savings amassed during the pandemic. But while this trend alone should be sufficient to prevent a recession, it also will continue to put upward pressure on inflation.

The Global Economy in Transition
Michael Spence (Project Syndicate) May 31, 2022
Questions about economic growth, inflation, innovation, and the impact of the Ukraine war on the transition to green energy dominate discussions about the global economy's condition and prospects. The picture that plausible answers paint is not bleak, but it's not rosy, either.

Local labour market effects of offshoring
Kozo Kiyota, Kentaro Nakajima, and Miho Takizawa (VoxEU) May 31, 2022
Offshoring is a controversial aspect of globalisation, and its impact on source country welfare remains ambiguous. This column analyses the impacts of offshoring on local labour market outcomes in Japan. It finds that offshoring exposure led to higher local employment, and particularly for non-offshoring firms. Furthermore, offshoring helped mitigate the negative effects of Chinese import competition on manufacturing employment. It highlights the increase in production by domestic plants as a potential mechanism to explain the positive effects of offshoring.

As China's Economy Falters, Be Careful What You Wish For
Clark Packard (FP) May 31, 2022
Why Western schadenfreude about Beijing's economic troubles is misplaced.

Lebanon Has an Opposition Movement Again
Hussain Abdul-Hussain (FP) May 31, 2022
A new coalition could check—or even dislodge—Hezbollah and its iron grip.