News & Commentary:

Articles/Commentary

The Fed’s actions are undermined by its words
FT View Aug 1, 2019
Jay Powell needs to improve his communication of monetary policy.

Investors and companies lose faith in public markets
FT View Aug 1, 2019
Going private looks appealing to both firms and fund managers.

Trade tensions are strangling American manufacturing
Megan Greene (FT) Aug 1, 2019
Slowing industrial production could portend a wider economic contraction.

Negative gas prices are set to stay in an industry based on faith
John Dizard (FT) Aug 1, 2019
The shortage of pipeline is nearly over but then overcapacity will bite.

Investors rediscover appeal of Russian bonds
Giancarlo Perasso (FT) Aug 1, 2019
Monetary policy and a bit of luck in higher oil prices have helped offset effect of sanctions.

Why Rate Cuts Don’t Help Much Anymore
Austan Goolsbee (NYT) Aug 1, 2019
Interest rates have been so low for so long that further cuts may not do a lot to stave off a slowdown.

The China Tariff Ratchet
WSJ Aug 1, 2019
Trump escalates his coercive trade showdown with China. ">The Fed should dial back on public speeches and focus on doing its job
Lawrence Summers (WP) Aug 1, 2019
Everyone knows it cannot predict the economic future.

The Fed makes its move
Economist Aug 1, 2019
America’s central bank cuts rates for the first time in over a decade.

The Fed Nailed It, Even If Markets Disagree
Daniel Moss (Bloomberg View) Aug 1, 2019
Powell isn’t responding to a global crisis, just a slowdown. One or two reductions is appropriate.

China Smiles and Waits as World Cuts Rates
Shuli Ren (Bloomberg View) Aug 1, 2019
Central bankers are using up their ammunition because they’re hostage to traders and politicians. Beijing has its eye on the long term.

Mario Draghi Sends His Love and Thanks to Jay Powell
Ferdinando Giugliano (Bloomberg View) Aug 1, 2019
The ECB chief will be very grateful for a stronger dollar, which will help the euro zone’s struggling manufacturers.

The Next Bailout May Come From Consumers
Conor Sen (Bloomberg View) Aug 1, 2019
A personal saving rate of 8.1% shows that if the economy turns south, Americans have room to spend more.

Trump’s Economy Is Plagued by Even More Uncertainty Than Obama’s
Justin Fox (Bloomberg View) Aug 1, 2019
Which is pretty wild, when you think back to the Great Recession.

Who’s Winning Trump’s Trade War? No One So Far
Noah Smith (Bloomberg View) Aug 1, 2019
There are signs of economic losses in both China and the U.S.

U.S.-China Trade War May Finally Be Coming for Apple
Shira Ovide (Bloomberg View) Aug 1, 2019
The iPhone maker has said little publicly about its potential hit or what steps it might take to mitigate the impact.

5 Smart Reasons to Tax Foreign Capital
Michael Pettis (Bloomberg View) Aug 1, 2019
A bipartisan bill that would create a trade-balancing exchange rate for the dollar also aims to reduce foreign purchases of certain U.S. assets.

The Fed Can't Give Markets the Certainty They Desire
Timothy A Duy (Bloomberg View) Aug 1, 2019
The status quo is likely sufficient to result in another rate cut in September, but not sufficient for anything more.

What About Rochester?
Kenneth Rogoff (Project Syndicate) Aug 1, 2019
There is much to be celebrated in the rise of modern megacities, especially in developing countries. But if the trend persists in advanced economies, which is by no means certain, greater public and private innovation will be required to strike a better regional growth balance.

From Football Victory to Economic Success in Algeria
Rabah Arezki (Project Syndicate) Aug 1, 2019
Algeria created a winning national football team in the midst of a political revolution that toppled the country's autocratic president, Abdelaziz Bouteflika. How it did so also provides a way to understand the economic reforms Algeria desperately needs.

ECB Loosening Is Not Enough
Lucrezia Reichlin (Project Syndicate) Aug 1, 2019
The European Central Bank's negative interest rates and quantitative easing measures cannot by themselves address the pervasive risk aversion holding back the eurozone economy. Eurozone policymakers must, therefore, find the political will to design a comprehensive package of financial and fiscal measures aimed at injecting new energy into the European project.

The Inequality of Nations
Michael Spence (Project Syndicate) Aug 1, 2019
Markets are mechanisms of social choice, in which dollars effectively equal votes; those with more purchasing power thus have more influence over market outcomes. Governments are also social choice mechanisms, but voting power is – or is supposed to be – distributed equally, regardless of wealth.

The international evidence on forward guidance
Michael Ehrmann, Gaetano Gaballo, Peter Hoffmann, and Georg Strasser (VoxEU) Aug 1, 2019
Forward guidance – communication by a central bank about the likely future path of interest rates – usually reduces uncertainty. This column argues that how this is done in practice matters, however, because forward guidance with a short time horizon can raise uncertainty. This occurs if the forward guidance impairs the aggregation of private information in financial markets, thus making market prices less informative.

The potential impact of machine translation on foreign trade
Jacques Melitz and Farid Toubal (VoxEU) Aug 1, 2019
Artificial intelligence has made spectacular progress in recent years. One particular source of high expectations is automatic translation and whether it will finally bring about the long-predicted death of distance in trade. This column examines the impact of a common language on bilateral trade and finds that the net result of reducing linguistic frictions with a set of trading partners is not apparent.The potential impact of machine translation on foreign trade remains up in the air.

Asia’s Great Huawei Debate
Pauline C. Reich, June Park, Aman Thakker, Motohiro Tsuchiya and Danielle Cave (Diplomat) Aug 1, 2019
On the Chinese telecom firm’s reception in Singapore, South Korea, India, Japan, and Australia.

Competition Without Catastrophe
Kurt M. Campbell and Jake Sullivan (FA) Aug 1, 2019
How America can both challenge and coexist with China.

Trump’s gamble weaves monetary policy into trade war
Michael Mackenzie (FT) Aug 2, 2019
Investors must judge whether rate cuts can offset trade stress.

Central banks should consider giving people money
Eric Lonergan (FT) Aug 2, 2019
Expecting the fiscal authorities to help out looks like wishful thinking.

The case for a centralised country
Janan Ganesh (FT) Aug 2, 2019
The world’s megacities attract jealousy — but they also draw in the most talented.

Cry Havoc! And let slip the dogs of trade war
Andrew Salmona and Lee Shin-Hyung (AT) Aug 2, 2019
Seoul outraged at removal from Japan’s favored trade partners’ list, but source calls brouhaha overblown.

Protectionist Diplomacy Goes Global
WSJ Aug 2, 2019
Tokyo is taking after Trump in using coercive trade against Seoul.

Trump's War on US Exports
C. Fred Bergsten (PIIE) Aug 2, 2019
President Donald Trump’s tariffs on US imports, ratcheted up Thursday to cover another $300 billion in goods that Americans buy from China, are only half the trade war he has been waging since taking office. The other half is to push other countries to buy more US industrial goods, energy products, and farm produce. Ironically, however, US exports have instead become one of the chief victims of the president’s trade conflicts. Export growth has plummeted over the last six months.

The pound’s wakeup call for Boris
Desmond Lachman (AEI) Aug 2, 2019
Johnson might heed the very clear warnings that he is now receiving from the currency market that risking a no-deal Brexit could be a very costly proposition for his country. However, it could also very well be the case that Johnson has already dug himself into a political hole from which it will be impossible to get out.

The Fed’s Rate Cut: Growth ‘Insurance’
Tiffany Wilding (PIMCO) Aug 2, 2019
We find the Fed’s statement clear, and we expect another rate cut as soon as September with possible additional cuts thereafter.

The Trade War Heads to American Households
David Fickling (Bloomberg View) Aug 2, 2019
Trump’s latest China tariffs will affect consumers, who have been spared the pain until now.

Boris Johnson Dreams of a “Side-Deal” Brexit
Lionel Laurent (Bloomberg View) Aug 2, 2019
The prime minister’s “madman” strategy will put a serious strain on EU unity, with enormous pressure to strike country-to-country deals with the U.K.

Don’t Be Bummed That GDP Can’t Measure Happiness
Noah Smith (Bloomberg View) Aug 2, 2019
No one number reliably captures every aspect of human well-being.

China’s Cambodian Invasion
Sam Rainsy (Project Syndicate) Aug 2, 2019
China’s dangerous military expansionism depends on compliant local regimes and inaction on the part of the international community. In the case of Cambodia, which has reportedly given China rights to a naval base, the international community should demand a new general election that does not exclude real challengers.

The High-Growth Promise of an Integrated Africa
Landry Signé and Ameenah Gurib-Fakim (Project Syndicate) Aug 2, 2019
Integrated economies, powered by innovative and high-growth businesses and strong private investment, are the key to a prosperous future for Africa. Initiatives like the recently launched African Continental Free Trade Area are an important step in the right direction.

What’s Next for China’s Political Economy?
Kevin Rudd (Project Syndicate) Aug 2, 2019
Slowing growth and the ongoing trade and technology war with the United States have forced China’s leaders to address a fundamental dilemma at the core of the Chinese political economy. Can the Communist Party of China both deliver on the “Chinese Dream” and maintain absolute control over the country?

Lagarde’s ECB Must Modernize
Marcel Fratzscher (Project Syndicate) Aug 2, 2019
Following her likely confirmation in November, Christine Lagarde will succeed European Central Bank President Mario Draghi at a time of deepening polarization among eurozone member states. It will take all of her skills as a leader and communicator to safeguard the institution's independence and ensure that it has the tools it needs.

Survey beliefs and portfolio allocations
Stefano Giglio, Matteo Maggiori, Johannes Stroebel, and Stephen P. Utkus (VoxEU) Aug 2, 2019
Though economists have made progress determining how investors form expectations, less is known about how those expectations inform portfolio choices. Until recently, few large-scale surveys contained the data to connect individual investors’ beliefs to their actual behaviour. This column uses data collected from a novel ongoing survey eliciting investors’ expectations about GDP growth and future stock and bond returns. By measuring the extent to which investors’ persistent and heterogeneous beliefs and confidence correspond to their portfolio allocations, the research presented here highlights the potential for survey data to inform macro-finance theories.

Global declining competition
Federico Diez, Jiayue Fan, and Carolina Villegas-Sanchez (VoxEU) Aug 2, 2019
Studies of the evolution of market power since 2000 have focused mostly on publicly traded US firms. This column introduces a new global study that incorporates private firms, and decomposes the aggregate effect into intensive and extensive margins. It shows the increase in markup is broad-based across countries and sectors, but is driven by a small number of firms. The markup increase is mainly explained by increases in the average markup of incumbents, and reallocation effects towards new firms that gain market share from incumbents.

Trump Hired Robert Lighthizer to Win a Trade War. He Lost.
Edward Alden (FP) Aug 2, 2019
The Trump administration’s policy of tariffs, threats, and forcing allies to bend to the United States’ will was based on a fallacy. Now, the future of trade remains unclear.

Is There Too Much Debt in the Eurozone?: Part I
Jay H. Bryson and Michael Pugliese (WF) Aug 2, 2019
In the first report in an upcoming series on debt in the Eurozone we show that the debt-to-GDP ratio in the Eurozone has receded modestly in recent years. However, it probably would be premature to sound the all-clear siren because leverage could rise again if the euro area were to slip into recession.

Retail investor leverage and speculation
Rawley Heimer and Alp Simsek (VoxEU) Aug 3, 2019
Policymakers for long have attempted to curb financial speculation while preserving markets for useful trading. This column analyses the impact of a recent US policy which restricts leverage in the foreign exchange market. It finds that the policy reduced speculative trading without impeding markets, and thus provides important lessons to address excessive growth in financial markets.

Illiquidity will amplify magnitude of next bear market
Amin Rajan (FT) Aug 4, 2019
Nuanced forces are at play and the Woodford saga may be the tip of the iceberg.

The UK and EU need mediation to unpick the Brexit mess
Horst Eidenmüller (FT) Aug 4, 2019
A commercial mediator makes the case for intervention to tease out an agreement.

The age of wealth accumulation is over
Rana Foroohar (FT) Aug 4, 2019
Voters and politicians agree it is time to slice the economic pie more evenly.

Germany is replaying Britain’s Brexit debate
Wolfgang Münchau (FT) Aug 4, 2019
Pro-Europeans should remember how the battle was lost in the UK.

The real story behind the Fed’s interest rate cut? Jobs.
Robert Samuelson (WP) Aug 4, 2019
Economists have argued a “hot” labor market could pay out huge dividends.

RCEP is now vital in defending the global trading order
Peter Drysdale and Mari Pangestu (EAF) Aug 4, 2019
The past ten days have seen two developments in global trade diplomacy that seem to offer important ways to deal with the US leadership deficit and, hopefully, over the long term, to attract the United States back into more productive global economic engagement.

The BoJ risks falling out of sync on global easing
FT View Aug 5, 2019
The ‘policy pioneer’ must face up to increasingly tough challenges.

No one wins in the rabbit-hole world of negative interest rates
Patrick Jenkins (FT) Aug 5, 2019
Hiding money in vaults might not be the ultimate intention but it’s a cheaper option.

Swiss franc hits highest level against euro in 2 years
Eva Szalay (FT) Aug 5, 2019
Speculation grows that central bank will intervene to cap currency’s appreciation.

The Asian strategic order is dying
Gideon Rachman (FT) Aug 5, 2019
Forty years of prosperity in the region are now under threat.

What next for the renminbi after it breaches Rmb7 per dollar?
Hudson Lockett (FT) Aug 5, 2019
Investors ask why China’s central bank has allowed currency to weaken beyond symbolic threshold.

Relying on liquidity risks leaving investors in hot water
Mohamed El-Erian (FT) Aug 5, 2019
Economic and political headwinds are poised to frustrate profitable strategies.

China using its currency to soften worst effects of trade war
Tom Mitchell (FT) Aug 5, 2019
By letting renminbi ‘crack seven’, Beijing has signalled near-term deal with US is unlikely.

China shows its strength by allowing the renminbi to slide
FT View Aug 5, 2019
The drop through Rmb7 per dollar will have limited economic impact.

Swiss franc hits highest level against euro in more than 2 years
Eva Szalay (FT) Aug 5, 2019
Speculation grows that central bank will intervene to cap currency’s appreciation.

Can China beat its addiction to real estate?
FTCR Aug 5, 2019
Housing stimulus has been ruled out but economy will struggle with withdrawal symptoms.

The Adults Are Back in Charge of Greece. And They Are Really Right-Wing.
Matthaios Tsimitakis (NYT) Aug 5, 2019
The return of order is proving to be the return of the right.

Trade War Becomes Currency War
WSJ Aug 5, 2019
Exchange-rate shifts introduce a new risk to global growth.

The Very Political Fed
WSJ Aug 5, 2019
The central bank looks to dominate the real-time payments market.

America Needs an Independent Fed
WSJ Aug 5, 2019
The economy functions best when the central bank is free of short-term political pressures.

Why a weakening yuan is rattling markets
Economist Aug 5, 2019
As the trade war with America worsens, China has stopped propping up its currency.

ECB Signals Easing, But What’s Left in the Policy Arsenal?
Andrew Bosomworth (PIMCO) Aug 5, 2019
Come the fall, the ECB will likely deliver yet another easing package that could effectively deplete its monetary policy toolbox.

Yuan at 7 Is China’s Warning Shot to Trump
Shuli Ren (Bloomberg View) Aug 5, 2019
Beijing is showing it won’t be used as a pawn in the president’s campaign for lower rates and a weaker dollar.

IMF’s Top Job Shouldn't Be Another Stitch-Up
Ferdinando Giugliano (Bloomberg View) Aug 5, 2019
Kristalina Georgieva is a strong candidate to head the fund, but non-Europeans like Singapore’s Tharman Shanmugaratnam shouldn’t be excluded.

China Is Playing Trump on Trade
David Fickling (Bloomberg View) Aug 5, 2019
Holding off on big agricultural purchases now is a low-cost, high-opportunity strategy.

Locating Equality
Harold James (Project Syndicate) Aug 5, 2019
For years, wealth and income inequalities have been rising within industrialized countries, kicking off a broader debate about technology and globalization. But at the heart of the issue is a fundamental good that has been driving social and economic inequality for centuries: real estate.

A long-run view of the structure of global trade finance
Olivier Accominotti and Stefano Ugolini (VoxEU) Aug 5, 2019
The 2008 crisis has revealed how banking and liquidity problems can have far-reaching consequences on global trade. This column reconstructs the evolution of global trade finance from the Middle Ages until today. Just like in medieval times, today’s global trade is predominantly financed through banks so that banking problems automatically transmit to international trade. In contrast, from the 16th to the 20th century, trade finance was mostly market-based. The decline of market-based trade finance was triggered by major geopolitical shocks.

The Brexit Price Spike
Neil Gerstein, Bart Hobijn, Fernanda Nechio, and Adam Shapiro (FRBSF Econ Letter) Aug 5, 2019
In June 2016, citizens of the United Kingdom voted to leave the European Union by a small majority. This looming departure became known as “Brexit.” As a consequence of the Brexit referendum, the British pound depreciated sharply, and overall inflation ramped up in the following months. Comparing price movements between tradable and nontradable goods shows that close to two-thirds of the inflation spike in the United Kingdom since the Brexit vote can be attributed to the sharp movement in the exchange rate.

Consumers Now Directly in Tariff Crossfire
Tim Quinlan, Sarah House, and Shannon Seery (WF) Aug 5, 2019
The recent escalation in the trade war involves levying a 10% tariff on an additional $300 billion worth of goods coming in from China. Our bet is that consumer price inflation will rise slightly, and, although that will not derail consumer spending, the latest round of tariffs could weigh on confidence.

HK flips from China’s prized relative to financial rival
Henny Sender (FT) Aug 6, 2019
Mainland’s dynamism contrasts with the territory’s reliance on older sectors.

Legality is not the problem with parallel currencies
Izabella Kaminska (FT) Aug 6, 2019
Critics of Italy’s mini-BOT identify the threat in the wrong place.

The threat of a US-China currency war
John Plender (FT) Aug 6, 2019
Were Beijing to sell off its Treasury holdings, extreme market volatility would follow.

Renminbi row shows depth of US-China schism
Tom Mitchell and Xinning Liu (FT) Aug 6, 2019
Beijing sees ‘managed float’ as key to stability but Washington sees it as manipulation.

Circulating in China’s Financial System: More Than $200 Billion in I.O.U.s
Alexandra Stevenson and Cao Li (NYT) Aug 6, 2019
As the trade war escalates, Beijing needs private companies to pull China’s economy out of its rut. But for some, ready money can be hard to find.

The U.S. Labeled China a Currency Manipulator. Here’s What It Means
Ana Swanson (NYT) Aug 6, 2019
The move is mainly symbolic but will escalate tensions with Beijing.

President Trump’s Fruitless Trade War
NYT Aug 6, 2019
The Trump administration continues to escalate its confrontation with China, but there is no clear goal — and no end in sight.

Hong Kong, the Trade Wild Card
WSJ Aug 6, 2019
An army crackdown could be the end of a U.S.-China deal.

HK's economic loss is Singapore's capital gain
Nile Bowie (AT) Aug 6, 2019
Businesses and investors are starting to look to Singapore as an exit strategy from Hong Kong's civil unrest and economic decline.

US using ‘dirty tactics’ in trade war
Gordon Watts (AT) Aug 6, 2019
China increases the rhetoric as fears grow about the global economy and markets.

The Trump administration labels China a currency manipulator
Economist Aug 6, 2019
The complaint is more than a bit muddled.

Trump's Latest Trade War Escalation Will Push Average Tariffs on China Above 20 Percent
Chad P. Bown and Eva (Yiwen) Zhang (PIIE) Aug 6, 2019
President Trump said on August 1, 2019, immediately following another round of US-China trade negotiations, that the United States would impose a 10 percent tariff on an additional $300 billion of imports from China, going into effect September 1, 2019. This would raise the average US tariff on China to 21.5 percent, up from 18.3 percent in May 2019 and from 3.1 percent since Trump took office.

Trump's Attack on China's Currency Policy
C. Fred Bergsten (PIIE) Aug 6, 2019
President Donald Trump has forced Secretary of the Treasury Steven Mnuchin to label China a “currency manipulator,” despite the absence of any evidence to that end. China did manipulate from 2003 to 2013, intervening massively in the foreign exchange markets to strengthen its competitive position by buying dollars to hold the renminbi down. Since then, however, it has on balance intervened heavily on the other side of the market: selling dollars to keep the renminbi from weakening and thereby supporting American rather than Chinese competitiveness. China has manipulated in favor of the United States for the past five years or so.

Five Flaws in the USMCA and How to Fix Them
Jeffrey J. Schott (PIIE) Aug 6, 2019
The stars seem to be aligning for passage in September of President Donald Trump’s heralded and terribly flawed trade pact, the United States–Mexico–Canada Agreement (USMCA).

Trade Tension Flare-Up: Not So Surprising
Libby Cantrill (PIMCO) Aug 6, 2019
We think investors should take President Donald Trump at his word that he will move forward with the next round of tariffs on China come September.

Interest Rates: Naturally Negative?
Joachim Fels (PIMCO) Aug 6, 2019
It is no longer absurd to think that the nominal yield on U.S. Treasury securities could go negative.

Making Technology Work for Workers
Shamina Singh (Project Syndicate) Aug 6, 2019
For workers, coping with the rapid technology-driven transformation of labor markets, without sacrificing dignity, autonomy, or ambition, will require a combination of economic mobility and financial security that can be delivered through a new kind of social safety net – one that puts benefits squarely in the hands of the individual.

The Real Cost of Trump’s Trade Wars
Daniel Gros (Project Syndicate) Aug 6, 2019
Economic analysis suggests that bilateral trade wars are unwinnable in an interconnected world. By firing his latest tariff salvo against China, US President Donald Trump has further raised the stakes in an increasingly damaging dispute – and America is likely to emerge as the bigger loser.

Central banks and reputation risk
Jon Danielsson (VoxEU) Aug 6, 2019
As central banks accumulate ever more job functions, their reputation risk increases. This column offers a cautionary tale from Iceland where, after the central bank was put in charge of capital controls, it was subject to severe attacks because of perceived mistakes in how the capital controls were enforced. The accumulation of powers erodes a central bank’s independence and subjects it to regulatory paralysis.

Japan Started a War It Wasn’t Ready to Fight
William Sposato (FP) Aug 6, 2019
Japan’s growing trade dispute with South Korea signals a shift in its foreign policy. But Tokyo may have overestimated its ability to take on Seoul.

Currency War With China Dooms Trade Talks
Keith Johnson (FP) Aug 6, 2019
U.S. President Donald Trump’s currency war with China has the potential to doom trade talks and ratchet up the likelihood of a global recession.

Trump’s Trade War with China Is Spiralling Out of Control
John Cassidy (New Yorker) Aug 6, 2019
The U.S.-China trade dispute is now a currency war as well, and, judging by the events of the past few days, it could well expand in other directions.

Investors must weigh the risk of rising inflation
John Redwood (FT) Aug 7, 2019
Trump leans on the Fed ahead of his re-election year.

The silver lining of ageing populations in emerging markets
Lauren Johnston (FT) Aug 7, 2019
China offers lessons in how to prepare for getting old before getting rich.

Currency war fears bolsters demand for havens
Eva Szalay (FT) Aug 7, 2019
Test for policymakers as worries mount over global economy and Sino-US tensions.

A Navarro Recession?
WSJ Aug 7, 2019
Trade and currency mistakes are eroding economic growth.

China’s Hand Is Stronger Than Trump Thinks
Shuli Ren (Bloomberg View) Aug 7, 2019
Beijing is less concerned about capital flight than in the past and could easily let the yuan weaken further.

Big Tech’s Harvest of Sorrow?
Daron Acemoglu (Project Syndicate) Aug 7, 2019
At the same time that science and technology have vastly improved human lives, they have also given certain visionaries the means to transform entire societies from above. Ominously, what was true of Soviet central planners is true of Big Tech today: namely, the assumption that society can be improved through pure "rationality."

The Real Reason for China’s Rise
Zhang Jun (Project Syndicate) Aug 7, 2019
The standard account of China’s economic rise focuses on its state capitalism, whereby the government, endowed with huge assets, can pursue a wide-ranging industrial policy and intervene to mitigate risks. This explanation is wrong.

The parliamentary Brexit endgame
Christopher Tyson (VoxEU) Aug 7, 2019
The Brexit deliberations in the House of Commons have been chaotic, protracted, and inconclusive, but the impasse cannot last forever. This column outlines a model of parliamentary preferences, calibrated to the profiles of members on the meaningful and indicative votes, that can be used to analyse the Brexit ‘endgame’ in a reasoned manner.

Germany’s economy needs a fiscal boost
FT View Aug 8, 2019
Berlin must loosen the purse strings to avoid the economy tipping into recession.

Infinite growth is a pipe dream
Vaclav Smil (FT) Aug 8, 2019
Moore’s law for memory chips is a one-off that will not be replicated.

The euro must prepare for future shocks
Laurence Boone (FT) Aug 8, 2019
Monetary policy is not enough on its own — fiscal co-ordination is essential.

Pricey bond proxies make safety trade more dangerous
Richard Henderson (FT) Aug 8, 2019
Sought-after real estate and utilities stocks are still prone to dips during a crisis.

China’s new renminbi level set to pressure Asia currencies
Hudson Lockett (FT) Aug 8, 2019
Central bank fixes midpoint for trading band above 7 to the dollar.

‘Weaponized’ Currency and Mining Limits: China’s Responses to Trump Take Shape
Alexandra Stevenson (NYT) Aug 8, 2019
Beijing’s signals suggest it is ready to retaliate should the White House follow through on its new tariff threat, with potentially disruptive results.

Trump’s trade war clearly isn’t working
Fareed Zakaria (WP) Aug 8, 2019
It has turned into a highly politicized and out-of-control wrecking ball.

Japan steps back from South Korean trade war
Andrew Salmon and Lee Shin-Hyung (AT) Aug 8, 2019
Tokyo's move to export key chemical used for chip manufacturing seen as step back from the brink.

The trade war escalates, and the fog of war descends
Economist Aug 8, 2019
America brands China a currency manipulator, and global markets swoon.

Prices for many goods do not move the way economists think they should
Economist Aug 8, 2019
When firms opt to tweak a product’s quality instead of its price, problems ensue.

1984 Revisited: The Rise of the Neo-Authoritarians
James M. Dorsey (Globalist) Aug 8, 2019
The graphic warnings in George Orwell’s prophetic novel 1984 are as relevant today as they were when it was first published 70 years ago.

Summer of Discontent: Market Volatility Underscores Fragility of Aging Expansion
Scott A. Mather (PIMCO) Aug 8, 2019
The last few days have highlighted the inherent fragility in markets – and the growth outlook globally.

The ECB Is Dragging Us Deeper Into Madness
Marcus Ashworth (Bloomberg View) Aug 8, 2019
With markets already pricing in a cut into even deeper negative rates, the yield curve is collapsing. This is alarming for the real economy.

Britain, Show Us Growth, Not Cash
Chris Hughes (Bloomberg View) Aug 8, 2019
Many U.K. companies are paying out heaps of cash and it’s still not enough to lure global investors.

The Fed's Coy Stance on Rates Risks Further Damage
Timothy A Duy (Bloomberg View) Aug 8, 2019
The more policy makers resist a strong response to global headwinds, the greater the likelihood that deeper rate cuts will be required in the future.

History Hints at How Trump's Tariffs Will Hurt Americans
Conor Sen (Bloomberg View) Aug 8, 2019
The latest round would take $30 billion from households. Think back to some surges in gasoline prices for a sense of how that feels.

'Geno-economics' Is a Thing, But Maybe It Shouldn't Be
Noah Smith (Bloomberg View) Aug 8, 2019
Biologists don’t understand the link between genes and behavior, so why should economists?

Saudi ‘Whatever It Takes’ Runs into Oil Market's ‘Whatever’
Liam Denning (Bloomberg View) Aug 8, 2019
Jawboning won’t hold back the forces driving prices lower.

Can America and China Avoid a Currency War?
Benjamin J. Cohen (Project Syndicate) Aug 8, 2019
Although the current poor state of Sino-American relations may make even a very limited currency détente unattainable, such a pact is not outside the realm of possibility. Ultimately, both America and China might see some advantage in taking currency conflict off the table, in the hope of preventing wider damage to themselves and others.

Elizabeth Warren’s Trade Makeover
Dani Rodrik (Project Syndicate) Aug 8, 2019
Senator Elizabeth Warren’s plan is not inherently protectionist. But if it occasionally requires some degree of trade protection – to shield labor, local communities, the tax regime, or environmental rules – it would be because there is a domestic program worth protecting.

Climate Action: Sustainable Floating Cities
Stefan Huebner (YaleGlobal) Aug 8, 2019
The United Nations Human Settlements Programme prepares for rising seas and mass migration.

The economics of bubbles
Brent Goldfarb and David A Kirsch (Aeon) Aug 8, 2019
Market booms and busts may be irrational, but we can understand why they happen – and what to do to mitigate the damage.

Reading the tea leaves amid market turmoil
FT View Aug 9, 2019
Escalation in the trade war is turning into a global demand shock.

There will be no winners in a currency war
Eswar Prasad (FT) Aug 9, 2019
Devaluation may seem tempting, but it helps neither China nor the US.

China looks to ‘staple’ together regional trade deal
Alan Beattie (FT) Aug 9, 2019
A prospective accord is slipping behind schedule as trade bigwigs make grandiose claims.

ECB’s conventional tools will not solve eurozone woes
Rick Rieder (FT) Aug 9, 2019
The European Central Bank should buy equities, lowering cost of capital to promote higher levels of demand.

Only a brutal shock will free markets whipsawed by trade fear
Michael Mackenzie (FT) Aug 9, 2019
A significant drop in US equities might convince Donald Trump to change tack.

Yes, There Is a Trade-Off Between Inflation and Unemployment
N. Gregory Mankiw (NYT) Aug 9, 2019
With unemployment and inflation now low, it might seem that their relationship no longer matters. Not so fast.

Italy’s Biggest Economic Problem? It’s Still Italy
Peter S. Goodman (NYT) Aug 9, 2019
Political chaos and confrontation with the European Union over spending rules have reinforced what a finance professor calls the country’s “serial stagnation.”

A Political Steel Trap
WSJ Aug 9, 2019
A company that praised Trump’s tariffs is now saying they’re unfair.

Trump’s economy was on fire two years ago. But voters have a short memory.
David Von Drehle (WP) Aug 9, 2019
If Americans’ prosperity takes a turn for the worse, it could cost the president a second term.

Latin America was making progress fighting corruption. Now impunity is roaring back.
Brendan O’Boyle and Brian Winter (WP) Aug 9, 2019
The historic crackdown on corruption that has sent presidents to jail across the region is now facing setbacks.

Singapore slings a trade war antidote
Nile Bowie (AT) Aug 9, 2019
New Singapore Convention on Mediation promises neutral settlement of commercial and trade disputes. China, US are among its backers.

China faces economic dilemma amid currency row
Gordon Watts (AT) Aug 9, 2019
Mixed data points to sluggish demand in the world’s second-largest economy.

China's Economic Outlook in Six Charts
IMF Aug 9, 2019
China’s economic growth is moderating and is projected to be 6.2 percent in 2019. In its latest annual assessment of China’s economy, the IMF found the quality of growth had improved in three ways in 2018. First, the pace of debt accumulation had slowed. Second, the financial system is better regulated and supervised. Finally, the current account surplus is no longer excessive. But trade tensions cloud the outlook, and reforms need to deepen if this progress is to be continued.

Boris Johnson Love Bombs the Other Union
Therese Raphael (Bloomberg View) Aug 9, 2019
As Brexit pulls the United Kingdom apart, the prime minister is struggling to keep it together.

U.S. Should Play an Easy Huawei Bargaining Chip With China
David Fickling (Bloomberg View) Aug 9, 2019
Washington’s tough line on licenses could help ease tensions if both sides now make a simple trade-off.

Italy Faces Its Moment of Truth on the Euro
Ferdinando Giugliano (Bloomberg View) Aug 9, 2019
Matteo Salvini won’t be able to hide behind Giovanni Tria and Luigi Di Maio now. He’ll have to show exactly where he stands on fiscal policy and Europe.

How Low Can Bond Yields Go? A Lot Lower
Komal S Sri-Kumar (Bloomberg View) Aug 9, 2019
There are five primary reasons why market rates are likely to set record lows sooner rather than later.

The Fed Isn’t Sending a Signal to Buy Stocks
Nir Kaissar (Bloomberg View) Aug 9, 2019
Set aside intuition and recent experience. The data don’t support the conclusion that lower interest rates bolster equities.

Great Ideas Are Growing Scarce. That’s Not So Great.
Noah Smith (Bloomberg View) Aug 9, 2019
Technological innovation is slowing, threatening not just growth but even our survival.

Pound Slide More About Brexit Than the Economy
Marcus Ashworth (Bloomberg View) Aug 9, 2019
A shrinking economy is bad, but a political crisis far worse.

Down the Rabbit Hole With Trump and Xi
Shuli Ren (Bloomberg View) Aug 9, 2019
The U.S. and China are carrying out a modern re-enactment of the tortoise-and-hare tale, in which neither side wins.

Financial constraints and the diffusion of technology
Çagatay Bircan and Ralph De Haas (VoxEU) Aug 10, 2019
Recent debates about the global productivity slowdown point to a large and increasing productivity gap between firms operating at the global technological frontier and those trailing behind. This column analyses whether better access to bank credit can accelerate technological diffusion and narrow the productivity gap between leading and lagging firms. Using data from a large emerging market – Russia – it shows that while bank loans can encourage firms to adopt new technologies and become more productive, long-run benefits vary substantially across industries and regions.

Narendra Modi’s New-Model India
Shashi Tharoor (Project Syndicate) Aug 9, 2019
By asserting direct government control over Kashmir, India's prime minister is remaking the country in the image of his chauvinist party. The new India is a far cry from the land of Mahatma Gandhi and Jawaharlal Nehru, who preached non-violence, religious co-existence, and the acceptance of difference.

Trump’s Manipulation of Currency Manipulation
Paola Subacchi (Project Syndicate) Aug 9, 2019
By treating international trade as a zero-sum game in which the US makes its own rules, President Donald Trump's administration has weakened the incentive for countries to engage in policy cooperation. Why should China bow to a US that treats it as an enemy?

Trump’s Deficit Economy
Joseph E. Stiglitz (Project Syndicate) Aug 9, 2019
Economists have repeatedly tried to explain to Donald Trump that trade agreements may affect which countries the US buys from and sells to, but not the magnitude of the overall deficit. But, as usual, Trump believes what he wants to believes, leaving those who can least afford it to pay the price.

The Currency Manipulation Game
Jeffrey Frankel (Project Syndicate) Aug 9, 2019
The United States government's assertion that the recent depreciation of the renminbi amounts to currency manipulation is not true. It would be more correct to say that the Chinese authorities gave in to market pressure – the immediate source of which was US President Donald Trump’s announcement of new tariffs on Chinese goods.

The Myth of Welfare Dependency
Rema Hanna (Project Syndicate) Aug 9, 2019
In most countries, rich and poor people alike worry that social programs for low-income households end up weakening work incentives and create an underclass of indigents. In fact, recent research suggests just the opposite: the longer families receive stable and predictable support, the better they and their children do.

Trade Disruption Is a Symptom of a Deeper Malaise
Mohamed A. El-Erian (Project Syndicate) Aug 9, 2019
Trade tensions are a symptom rather than a cause of the world’s underlying economic and financial malaise. Moreover, an excessive focus on trade could deflect policymakers’ attention from other measures needed to ensure faster and more inclusive growth in a genuinely stable financial environment.

The Japan-US ‘Mini-Deal’ Has Big Implications
Stephen Olson (Diplomat) Aug 9, 2019
As the US and Japan intensify trade negotiations, the push for a quick “mini-deal” on agriculture and autos will have far-reaching impact.

No, Productivity Does Not Explain Income
Blair Fix (Evonomics) Aug 10, 2019
Marginal productivity is a thought virus that is sabotaging the scientific study of income

Shrinking UK economy is a Brexit warning
FT View Aug 11, 2019
A contraction in the second quarter shows the need to avoid no deal.

Threats to European integration are mounting
Wolfgang Münchau (FT) Aug 11, 2019
The EU is facing an economic downturn, a currency war and a political crisis in Italy.

Old EU order should not dictate new IMF head
John Taylor (FT) Aug 11, 2019
The fund needs leadership from outside the bloc to meet the challenges of a multipolar world.

Braced for the global downturn
Rana Foroohar (FT) Aug 11, 2019
Well-meaning central bankers cannot offset the impact of an erratic US president on the real economy.

Is the economy turning against Trump?
Robert Samuelson (WP) Aug 11, 2019
Most economists aren’t yet predicting a recession, but they’re drifting in that direction.

Europe’s Autumn of Economic Discontent
WSJ Aug 11, 2019
The looming dismal season is bigger than Trump, or Germany.

The Trade War Hits China Where It Hurts
By Andy Puzder and Jim Talent (WSJ) Aug 11, 2019
Beijing’s doctored data shows growth has slowed to 6.2%. The actual rate is almost certainly worse.

Venezuela Grows More Unequal
Mary Anastasia O’Grady (WSJ) Aug 11, 2019
The haves find ways to provide basic services. The have-nots suffer intensely.

How to Stop Trump’s Trade War Madness
Jenniver A. Hillman (NYT) Aug 11, 2019
Congress has the authority to limit the president’s reckless endangerment of the economy.

Why ASEAN’s Indo-Pacific outlook matters
Amitav Acharya (EAF) Aug 11, 2019
Indonesia is uncomfortable with the US approach to the concept of the Indo-Pacific, seeing it as exclusionary and aimed at isolating China.

Gloom Over Oil Demand Will Only Get Worse
Julian Lee (Bloomberg View) Aug 11, 2019
Behind small tweaks to annual forecasts, the trend is becoming clear. Oil demand growth is drying up.

Danger Signs From an Esoteric Corner of Finance
Andy Mukherjee (Bloomberg View) Aug 11, 2019
A scarcity of greenbacks in the swaps market is worsening. This has been a predictor of past trouble, including the 2008 crisis.

US should drop concerns around state planning
FT View Aug 12, 2019
The need to transition to a worker-led economy is increasingly clear.

Argentina needs a long-term economic plan
FT View Aug 12, 2019
A markets crisis is in nobody’s interest as election approaches.

US banks hope to avoid the fate of those in Europe
Robert Armstrong (FT) Aug 12, 2019
Falling long-term interest rates create challenges, but a more dynamic economy will help.

Investors would be wise to be wary of Chinese assets
Diana Choyleva (FT) Aug 12, 2019
Get set for a lengthy, all-encompassing power struggle between Washington and Beijing.

Why we should measure national wealth in assets
Diane Coyle (FT) Aug 12, 2019
There are problems in using gross domestic product as the metric of economic success.

US-China trade war data belie Donald Trump’s bragging
James Kynge (FT) Aug 12, 2019
One year in, Chinese trade surplus with the US has swollen.

Trump Is Right—the Fed Is Still Tightening
Donald L. Luskin (WSJ) Aug 12, 2019
Sure, the size of the balance sheet is holding steady, but leaving riskier assets in the market will slow growth.

The Myth of Chinese Exceptionalism in Africa
Irene Yuan Sun (CGD) Aug 12, 2019
Those of us who research Chinese business in Africa have always struggled with a seeming paradox: we study Chinese firms specifically because they are such a critical, rising force in African economies, yet many of us balk at the hype and hysteria often perpetuated by the media and politicians about Chinese businesses in Africa simply because they are Chinese. And I’ll be the first to admit that my own work contributed to this sense of Chinese exceptionalism in Africa: by targeting Chinese firms as the object of research, I had no way to draw rigorous comparisons with local firms or firms of other nationalities operating in Africa.

Banking fears add to China's economic headache
Gordon Watts (AT) Aug 12, 2019
Trade war, slowing economy and debt woes threaten to spoil birthday bash for the People's Republic of China.

Saudi Aramco Bets $15 Billion on India’s Crude Habit
David Fickling (Bloomberg View) Aug 12, 2019
The investment in Reliance’s petroleum business is likely to pay for itself even as the country works to cap its dependence on oil.

Lower Mortgage Rates Aren't Boosting U.S. Housing
Danielle DiMartino Booth (Bloomberg View) Aug 12, 2019
The residential real estate market is less affordable now than anytime since before the financial crisis.

Tourism Is Eating the World
Noah Smith (Noah Smith) Aug 12, 2019
Congestion taxes seem like the inevitable answer.

Trump’s Currency War Smacks of the 1930s
Stephen Mihm (Bloomberg View) Aug 12, 2019
Too many have forgotten the searing pain of the last “uncoordinated break-up” of the world’s currency regime.

To Conquer World, China Needs to Get Smarter
Michael Schuman (Bloomberg View) Aug 12, 2019
A poorly educated workforce is a major impediment to its hopes of challenging the U.S. in technology.

Democracies in Danger
Ngaire Woods (Project Syndicate) Aug 12, 2019
Recent unilateral decisions by the Indian, American, and British governments are part of a worrying trend in the world’s leading democracies. But instead of resorting to outrage, democrats everywhere should focus their efforts on protecting public debate, reinforcing key institutions, and limiting the personalization of power.

America’s Superpower Panic
J. Bradford DeLong (Project Syndicate) Aug 12, 2019
History suggests that a global superpower in relative decline should aim for a soft landing, so that it still has a comfortable place in the world once its dominance fades. By contrast, US President Donald Trump's incoherent, confrontational approach toward China could seriously damage America’s long-term interests.

How Africa Can Adapt to the Digital Revolution
Kartik Akileswaran and Georgina Hutchinson (Project Syndicate) Aug 12, 2019
The Fourth Industrial Revolution does not mean the end of traditional manufacturing-based development models in Africa, but it will require governments and policymakers to become more innovative and experimental. Africa can find a path to the economy of the future if its governments are ready and willing to adapt.

Trump’s Cross of Gold
Barry Eichengreen (Project Syndicate) Aug 12, 2019
US President Donald Trump wants to compress the United States trade deficit and enhance the competitiveness of domestic manufacturers by using tariffs to raise the price of imported goods. And the fixed exchange rates he needs to achieve that goal are the real reason behind his nomination of Judy Shelton to the Federal Reserve Board.

The dissonance of the short and long term
Jon Danielsson and Robert Macrae (VoxEU) Aug 12, 2019
The type of risk we most care about is long-term, what happens over years or decades, but we tend to manage that risk over short periods. This column argues that the dissonance of risk is that we measure and manage what we don't care about and ignore what we do.

How Sweden became more entrepreneurial than the US
Fredrik Heyman, Pehr-Johan Norbäck, and Lars Persson (VoxEU) Aug 12, 2019
Recent studies document a 30-year decline in various measures of dynamism in the US, manifested in a decline in the share of young firms as well as their share of job creation. This column shows that this has not been the case in Sweden. Young firms have been more prominent in the Swedish business sector than in the US in recent decades, and policies to encourage entrepreneurship are key to this.

Spatial patterns and city size distribution
Tomoya Mori (VoxEU) Aug 12, 2019
The growth of large cities is often attributed to their proximity to exogenous, first-nature advantages. This column uses data on 450 Japanese cities to show that in fact, the regularity of agglomeration holds as a natural consequence of endogenous agglomeration and dispersion forces at the global or local level, rather than exogenous factors.

Boris Johnson Doesn’t Want a No-Deal Brexit. He Wants to Win an Election.
Aleks Eror (FP) Aug 12, 2019
British Prime Minister Boris Johnson has touted his willingness to move forward with a no-deal Brexit. But Johnson’s rhetoric is meant to provoke Remainers into blocking Brexit and help him electorally.

Manufacturing and Inclusive Growth Challenges for China
Robert Z. Lawrence (PIIE) Aug 12, 2019
For more than three decades the goal of becoming “the factory of the world” has been at the core of China’s development strategy. This strategy, in combination with high rates of domestic investment and low rates of consumption, made Chinese production the most manufacturing intensive in the world. But as its wages have risen, China’s competitiveness in the most labor-intensive manufacturing industries has eroded. Its ability to assemble products remains a major source of its exports, but it has also tried to shift toward more sophisticated value-added production domestically. Chinese domestic spending has shifted away from investment toward more consumption as citizens’ incomes have grown. Like Americans, Chinese people are also spending more on services than on manufactured goods. All these changes are fundamentally altering the structure of China’s production, reducing the role of manufacturing, and increasing the skill levels of workers in manufacturing. This Policy Brief reviews the challenges posed by these developments for China’s long-term goal of achieving more inclusive growth. It presents evidence that commonly held perceptions that Chinese manufacturing employment growth is robust are wrong. In fact, such growth has peaked and China is now following the pattern of structural change that is typical of a more mature emerging economy, in which the share of employment in manufacturing declines as workers are increasingly employed in services.

Saudi Arabia needs more Opec production cuts, and soon
David Sheppard (FT) Aug 13, 2019
Looming US election and Saudi Aramco float plans mean the kingdom needs higher oil prices urgently.

Argentina’s political rivals must face economic reality
Hector Torres (FT) Aug 13, 2019
Mauricio Macri cannot cajole middle class voters by saying he keeps the markets happy.

Currency manipulation charges against China are unfounded
Liu Guoqiang (FT) Aug 13, 2019
Trade tensions with the US have inevitably put the renminbi under pressure.

Hong Kong’s future hangs by a thread
Jamil Anderlini (FT) Aug 13, 2019
It has become an obstacle to Xi Jinping’s vision of a ‘great rejuvenation’ of China.

A Tactical Tariff Retreat
WSJ Aug 13, 2019
A tacit admission that trade wars aren’t cost-free to consumers.

Last Exit Before a Cold War?
Holman W. Jenkins, Jr. (WSJ) Aug 13, 2019
What China would say if it really understood President Trump’s ideas about trade.

What comes after Bretton Woods II?
Economist Aug 13, 2019
The world’s monetary system is breaking down.

Time to Switch Rates: Preparing for the Libor Transition
Serge Gwynne, Jennifer Tsim and Adam Schneider (Brink) Aug 13, 2019
Banks and industry groups prepare for a transition from Libor, despite some uncertainty about the process. Oliver Wyman’s new report on replacing Libor outlines why the speed of change needs to accelerate ahead of 2021 and lays out some actions for banks, regulators and market infrastructure to take.

Why the Dollar Rules the World — And Why Its Reign Could End
Antony P. Mueller (Mises Wire) Aug 13, 2019
The US dollar came to rule the world in the wake of two world wars. But back then, the dollar's hegemony was based on a solid foundation of savings and capital accumulation. But today, the dollar's growth is based on huge piles of debt.

China’s state capitalism: can it last?
Brian Caplen (Banker) Aug 13, 2019
Donald Trump should relax his China bashing. There are reasons why China will have to reform its model of its own accord.

Singapore Adds a Dour Note to Grim Global Outlook
Daniel Moss (Bloomberg View) Aug 13, 2019
The city-state that stands at the crossroads of global trade and capital flows may not grow at all this year.

Christine Lagarde's Biggest Problem Is Germany
Ferdinando Giugliano (Bloomberg View) Aug 13, 2019
The incoming ECB chief has the political skills to try to persuade Berlin to loosen its fiscal stance. Sadly, her chances of success are still very slim.

Warren’s Trade Plan Does Poor Nations No Favors
Noah Smith (Bloomberg View) Aug 13, 2019
Requiring developing countries to match U.S. labor and environmental standards is unrealistic.

Let China Build The Longest Undersea Rail Tunnel
Leonid Bershidsky (Bloomberg View) Aug 13, 2019
The Tallinn-Helsinki link offers Europe more geopolitical advantages than risks.

What Markets Are Telling Argentina’s Next Leader
Mac Margolis (Bloomberg View) Aug 13, 2019
Even before the fall election, Alberto Fernandez should embrace the current president’s economic agenda.

Trump’s Trade War Revives Xi’s Silk Road
Shuli Ren (Bloomberg View) Aug 13, 2019
China’s global infrastructure initiative was in trouble a year ago, but emerging countries are signing on again.

Trump’s One-Way Economy
Jim O'Neill (Project Syndicate) Aug 13, 2019
If these were normal times, recent global developments would be showing up as sharply rising risk premia. But with monetary policymakers trying to sustain the current growth cycle in the face of disruptions from an incompetent US administration, these are anything but normal times.

Global Money for the Poor
Camila Villard Duran (Project Syndicate) Aug 13, 2019
Perhaps remittances today are what the small-coin debasement was for the medieval monetary system: an incomplete and temporary cure for the shortage of money. What is really needed is an effective and reliable means of international payment to provide cross-border liquidity for the poor.

The Puzzle of Economic Progress
Diane Coyle (Project Syndicate) Aug 13, 2019
Current academic research – into the impact of new technologies, the economics of innovation, and the quality of management, for example – may be providing ever more pieces of the puzzle. But many crucial questions about economic progress remain unanswered, and others have not yet even been properly posed.

Fast trading and the virtue of entropy
Giancarlo Corsetti, Romain Lafarguette, and Arnaud Mehl (VoxEU) Aug 13, 2019
Many policymakers are concerned that fast trading has adverse effects on markets, although the existing evidence is ambiguous. This column argues that high-frequency trading can increase market efficiency and the quality of trade. By creating noise, fast trades may prevent traders with a herd mentality from pushing prices in one direction.

Is China a “Currency Manipulator”?
Farok J. Contractor (YaleGlobal) Aug 13, 2019
US tariffs target the renminbi, allow Chinese exporters to keep profits and low prices for US consumers.

Reprieve: Roughly 60% of New Tariffs Delayed
Tim Quinlan, Sarah House, and Shannon Seery (WF) Aug 13, 2019
Our analysis of today's announcement of a postponement of a subset of the tariffs on imported Chinese goods suggests that about 60% of the total, or roughly $155 billion worth of goods, will be delayed. The delay reduces the risk that trade tensions will take a meaningful toll on consumer confidence and weaken real household spending, at least in the near term.

State ownership is back in the spotlight
Ben Hall (FT) Aug 14, 2019
SOEs can be useful for policy and patronage reasons but some are much less productive than they could be.

Emerging market bond rally can turn on a sixpence
Steve Johnson (FT) Aug 14, 2019
Yield-seeking EM investors should not forget that currencies are vulnerable to swings.

China hot pot stocks offer EM investors limited nourishment
James Kynge (FT) Aug 14, 2019
Fears over US trade war and Hong Kong protests are hurting wider sentiment.

Year with a 9 to survive or thrive: China’s 2019
Yu Jie (FT) Aug 14, 2019
Communist party leadership focuses on domestic policy, not trade war or decoupling.

Zimbabwe’s crisis has reached a breaking point
David Pilling (FT) Aug 14, 2019
The fault lies entirely with the ruling Zanu-PF party, which has lost its legitimacy.

Macri setback hits Trump’s Latin America agenda
Michael Stott (FT) Aug 14, 2019
Argentina's shift to the left creates political headache for Washington.

The Navarro Recession, II
WSJ Aug 14, 2019
Evidence of a tariff-inspired slowdown spooks the markets.

Argentina’s Race to the Bottom
WSJ Aug 14, 2019
Investors flee on the prospect of a return of the Peronists to power.

Global Economic Trouble Is Brewing, and the Trade War Is Only Part of It
Neil Irwin (NYT) Aug 14, 2019
A clear signal from the bond market that investors are pessimistic about the economy’s longer-term prospects.

China’s “currency manipulation” in context
Stephen Grenville (Interpreter) Aug 14, 2019
China previously mirrored the policies of other emerging economies, with the same success – only on a huge scale.

What’s Really Behind the Fall in China’s GDP?
Richard Dasher (Brink) Aug 14, 2019
China’s GDP growth in the second quarter of 2019 had the smallest gain since 1992. How much of this is due to the current U.S.-China trade conflict, and how much of it is being caused by longer-term issues in China itself?

Strong Core CPI Inflation Won’t Sway the Fed From Rate Cuts
Tiffany Wilding (PIMCO) Aug 14, 2019
We think the Federal Reserve will look past stronger-than-expected consumer price increases in June and July.

U.S. Businesses Are Stuck in Trade War Uncertainty
Michael R Strain (Bloomberg View) Aug 14, 2019
Worry grows that the president just doesn’t understand international economics.

When the End of the Earth Isn’t Far Enough to Escape the World
Daniel Moss (Bloomberg View) Aug 14, 2019
Australia and New Zealand thought they were immune from everywhere else’s economic ills. Monetary policy suggests otherwise.

The Bond Raters Still Need to Be Fixed
Barry Ritholtz (Bloomberg View) Aug 14, 2019
The reforms adopted after the financial crisis didn’t resolve the industry’s inherent conflicts.

It's Gotten Too Hard to Strike It Rich In America
Noah Smith (Bloomberg View) Aug 14, 2019
Many of the traditional ways of accumulating wealth are out of reach.

The Fed Needs a Radical New Approach
Clive Crook (Bloomberg View) Aug 14, 2019
It should change not only the way it makes policy but also the way it talks about it.

Germany Needs a Recession to Start Spending
Leonid Bershidsky (Bloomberg View) Aug 14, 2019
The pressure on Angela Merkel to give up the zero deficit policy is mounting as the economy weakens, but she will wait before turning on the spending taps.

Italy’s Economic Rot Is Europe’s Problem, Too
Tyler Cowen (Bloomberg View) Aug 14, 2019
Two decades of nearly nonexistent growth is hurting both the country and the continent.

China’s Slumping, So What’s Up With Coal?
David Fickling (Bloomberg View) Aug 14, 2019
Blame the trade war and Xi Jinping’s creed of self-reliance for this spending boom. Prices will suffer.

Switzerland Is Held Captive By Its Big Neighbor
Marcus Ashworth (Bloomberg View) Aug 14, 2019
With the ECB set to cut rates, the Swiss will have little choice but to go even deeper into negative territory. The SNB is a price-taker, not a price-maker.

Forget the Yield Curve. The 30-Year Treasury Is Scary.
Brian Chappatta (Bloomberg View) Aug 14, 2019
A record low yield shows bond traders have lost all fear of rising interest rates, a stronger economy or a sustained rebound in inflation.

The American Dream 2.0
Alexander Friedman (Project Syndicate) Aug 14, 2019
As an idea that encapsulated the principles of equitable, broadly shared growth and meritocracy, the American Dream allowed the United States to become the world's premier economy. But in recent decades, the dream has ceased to be a reality, and more and more workers have fallen behind – possibly for good.

The IMF’s Latest Victims
Jayati Ghosh (Project Syndicate) Aug 14, 2019
In 2013, the International Monetary Fund produced a report acknowledging that it had “underestimated” the effects that austerity would have on Greece’s economy. Yet the Fund has made the same mistakes in its subsequent deals with Argentina and Ecuador.

Purely financial market participants improve spot market performance
Akshaya Jha and Frank Wolak (VoxEU) Aug 14, 2019
Futures trading should make spot markets more efficient. The column uses the introduction of purely financial traders in the California energy market to show that their presence reduced average price differences between day-ahead and real-time markets. The introduction of financial trading in high-demand hours saved $23 million in fuel costs and reduced emissions and pollution.

How ergodicity reimagines economics for the benefit of us all
Mark Buchanan (Aeon) Aug 14, 2019
A subtle and mostly forgotten centuries-old choice in mathematical thinking has sent economics hurtling down a strange path

Down, Not Out: Late Cycle Business Spending
Tim Quinlan and Sarah House (WF) Aug 14, 2019
Business fixed investment has shifted into a lower gear, but despite late cycle dynamics like fading profits and elevated debt levels, we have measured optimism for business spending in the second half of the year.

Italy Back in Poll Position
Erik Nelson and Michael Pugliese (WF) Aug 14, 2019
Italian political risk is back in the headlines, with a confidence vote in the current government possible next week. If the current government falls, Italy could have another snap election in the coming months, perhaps around late October.

The Yield Curve: Is Recession Coming?
Jay H. Bryson (WF) Aug 14, 2019
The yield on the 10-year Treasury note has traded below the yield on the 2-year note. But the underlying fundamentals of the economy are generally sound. Could we "talk ourselves" into recession?

The Population Bust
Zachary Karabell (FA) Aug 14, 2019
Demographic decline and the end of capitalism as we know it.

Trump’s Trade War Could Make the Trump Recession a Reality
John Cassidy (New Yorker) Aug 14, 2019
The longer the President persists in his trade war with China, the greater the chances are of an outright slump developing in the U.S. economy.

A currency war Trump was never going to win
Megan Greene (FT) Aug 15, 2019
The US cannot unilaterally weaken the dollar.

Bond yields: ahead of the curve
Lex (FT) Aug 15, 2019
Anyone can tell an economic downturn lies ahead; disentangling cause and effect is harder.

Fed chair must be wary of a market running ahead of itself
Adam Samson (FT) Aug 15, 2019
The costs of another ‘taper tantrum’ could be much higher now than six years ago.

Shrunken stock markets are a rising political risk
Robert Buckland (FT) Aug 15, 2019
Trend towards ‘de-equitisation’ is not likely to reverse any time soon.

How the trade war is damaging the US tech industry
Richard Waters (FT) Aug 15, 2019
Executives conclude their world is changing for good — and not in ways they wanted.

Central Bankers in Glass Houses
Charles W. Calomiris (WSJ) Aug 15, 2019
The Fed was politicized long before Donald Trump got to the White House or even started tweeting.

What’s the Deal With That Inverted Yield Curve? A Sports Analogy Might Help
Neil Irwin (NYT) Aug 15, 2019
A bet by investors that the future will be worse than the present.

How World Leaders Ruined the Global Economy
Steven Rattner (NYT) Aug 15, 2019
They took the best growth picture in a decade and put us in danger of recession.

As Recession Concerns Mount, Dozens of Central Banks Are Cutting Rates
Jeanna Smialek and Karl Russell (NYT) Aug 15, 2019
More than 30 around the world have acted in the face of recession fears. Economists warn of a currency-tied competition.

Why the international community should prioritize democracy over development in Africa
Jeffrey Smith (WP) Aug 15, 2019
Africans want more democracy. Why aren't we helping them to get it?

Why Trump’s Hong Kong gamble won’t fix anything
William Pesek (AT) Aug 15, 2019
Investors should keep their seatbelts buckled for more turmoil to come as Trump brings Hong Hong into the trade war with China.

Recession fears stalk global markets
Gordon Watts (AT) Aug 15, 2019
US-China trade war, Brexit and Hong Kong turmoil fuel concerns of a perfect economic storm.

The trade war is leading some firms to crimp investment
Economist Aug 15, 2019
Much depends on whether hostilities between America and China intensify.

Zimbabwe’s economy is crashing and its people are hungry
Economist Aug 15, 2019
Outsiders can help, but should demand real reform.

Offshoring and the decline in US manufacturing employment
Christoph Boehm, Aaron Flaaen, and Nitya Pandalai-Nayar (VoxEU) Aug 15, 2019
What has caused the rapid decline in US manufacturing employment in recent decades? This column uses novel data to investigate the role of US multinationals and finds that they were a key driver behind the job losses. Insights from a theoretical framework imply that a reduction in the costs of foreign sourcing led firms to increase offshoring, and to shed labour.

Financial crises, regulation, and the structure of interbank networks
Matthew Jaremski and David Wheelock (VoxEU) Aug 15, 2019
In response to the Global Crisis a decade ago, banks have tried to make themselves more resilient to shocks transmitted through interbank connections. But the opacity of interbank networks makes it difficult to measure the effectiveness of such policies. This column uses evidence from 20th century America to show how the founding of the Federal Reserve and the Great Depression affected interbank networks and lending practices. The creation of the Fed reduced network concentration and therefore contagion risk, but the system remained vulnerable to local panics.

Islamophobia Embraced as Anti-Globalization Tool
Azeem Ibrahim (YaleGlobal) Aug 15, 2019
Nationalist populists target Muslims as scapegoats and ignore big challenges.

What the Last Recession Tells Us About the Next One
FP Aug 15, 2019
A transcript of U.S. Federal Reserve Chairman Jerome Powell’s remarks in Paris.

Is There Too Much Debt in the Eurozone?: Part II
Jay H. Bryson, Michael Pugliese, and Hop Mathews (WF) Aug 15, 2019
Instability in the Eurozone economy has reinvigorated concerns about a potentially unsustainable build-up of debt in certain sectors and countries. In this report, which is our second installment in a series of reports on debt in the euro area, we analyze the household sector to determine whether it could be the potential catalyst for a debt crisis in the foreseeable future.

Trump’s Assault on the Global Trading System
Chad P. Bown and Douglas A. Irwin (FA) Aug 15, 2019
And why decoupling from China will change everything.

Upside down world marks limits of monetary policy
FT View Aug 16, 2019
Borrowing for free comes with rising risks over financial stability.

Bank of England may have no choice but join race to the bottom
Geoffrey Yu (FT) Aug 16, 2019
Central banks around the world are sending out worrying signals about the economy.

Dogma and complacency put the German economy at risk
Christian Odendahl (FT) Aug 16, 2019
A lack of political ambition, reform and investment when times were good have hobbled the country.

Dogma and complacency put the German economy at risk
Christian Odendahl (FT) Aug 16, 2019
A lack of political ambition, reform and investment when times were good have hobbled the country.

A hard Brexit could test UK’s reliance on the kindness of strangers
Tommy Stubbington (FT) Aug 16, 2019
Yawning current account deficit is a vulnerability associated with emerging markets

Argentine assets still look vulnerable to another selling frenzy
Colby Smith (FT) Aug 16, 2019
Stocks shed about 40 per cent in dollar terms this week but further dangers loom.

Germany Has Powered Europe’s Economy. What Happens When Its Engine Stalls?
Jack Ewing (NYT) Aug 16, 2019
The economic woes afflicting the region’s biggest economy will drag down the region, despite growth in countries like Greece, Portugal and Spain, analysts say.

The developing world's water crisis has arrived
Saikay Datta (AT) Aug 16, 2019
A study across 15 cities in South Asia, Africa and South America shows that water is inaccessible and unaffordable.

China plans another round of ‘belt-tightening’
Gordon Watts (AT) Aug 16, 2019
Finance Minister Liu Kun comes up with a stark austerity message as China’s economy slows.

The End of “Peak Germany” and the Return of France
Jacek Rostowski and Arnab Das (Project Syndicate) Aug 18, 2019
Europe works best, as the old quip has it, with the Russians out, the Germans down, and the Americans in. Today’s new European order has the Russians up, the Germans on the way down, the Americans potentially bowing out, Britons struggling toward Brexit – and France rising.

The Case for a Guaranteed Job
Robert Skidelsky (Project Syndicate) Aug 16, 2019
A government’s job is to protect its people from misfortune, in particular want of work, and one that abandons this duty of care to the market deserves to be cast out. This is the best argument for giving a government job-guarantee program a fair trial.

Externalities - and cheating - in the financial crisis
Marcus Miller and Lei Zhang (VoxEU) Aug 16, 2019
Externalities can have a powerful effect on financial stability. This column studies the amplification effect that can operate despite value at risk regulation, which suffers from the ‘fallacy of composition’. It shows that the magnitudes of booms and busts are amplified by two significant externalities triggered by aggregate shocks: the endogeneity of bank equity due to mark-to-market accounting and of bank liquidity due to 'fire-sales' of securitised assets. In addition to economic models, legal and political factors should also be considered.

Inter-city trade
Tomoya Mori and Jens Wrona (VoxEU) Aug 16, 2019
The gravity equation has often been used to explain trade between regions or cities within countries. But it assumes that the distribution of industries is exogenous. This column explains how trade estimates are affected if we assume that large, centrally located cities attract more industries whose firms are more likely to export to other cities. Japanese data show exports from these cities are systematically underpredicted by aggregate gravity estimations, as the theory predicts.

The Next Battleground in Trump’s Trade War: Vietnam
Alexander Hitch (Diplomat) Aug 16, 2019
Vietnam is likely the Trump administration’s next trade target. But the calculus differs in key ways from China.

Trump’s Plan to Slash Foreign Aid Puts Humanitarian Programs in Jeopardy
Robbie Gramer and Colum Lynch (FP) Aug 16, 2019
The Trump administration intends to cut billions of dollars from congressionally approved foreign aid programs.

What’s Wrong With the Global Economy?
Ruchir Sharma (NYT) Aug 17, 2019
The problem goes much deeper than Trump or tariffs.

How the Recession of 2020 Could Happen
Neil Irwin (NYT) Aug 17, 2019
The freeze-up in business confidence, caused in part by the trade war, could wind up affecting consumer confidence.

Markets are braced for a global downturn
Economist Aug 17, 2019
The signals from bonds, currencies and commodities are increasingly alarming.

International business cycle co-movement in the global production network
Zhen Huo, Andrei Levchenko, and Nitya Pandalai-Nayar (VoxEU) Aug 17, 2019
The international co-movements of business cycles is a key determinant of trade and monetary policy, but the ways in which it is affected by technology, TFP, and trade openness are not fully understood. This column shows how such co-movements are affected by trade linkages and technology. It finds that non-technology shocks contribute more to international co-movement than TFP shocks, and that transmission plays a notable but small part in co-movements.

Rise of Bank Competition: Evidence from Banking Deregulation in China
Haoyu Gao, Hong Ru, Robert Townsend, and Xiaoguang Yang (VoxChina) Aug 17, 2019
This paper documents a novel trade-off of banking deregulation in the context of China by using loan-level big data. We find that following a deregulation in the form of geographically lowered bank entry barriers, the potential benefits such as the lower interest rates for borrowers were mitigated adversely by the worsening credit allocation. The soft budget constraint of SOEs, with implicit government guarantees, makes new entrant banks prefer inefficient SOEs to contemporaneously-opaque local private firms.

Washington warms to the idea of a weaker dollar
Brendan Greeley (FT) Aug 18, 2019
The novelty of an interventionist approach gains cross-party traction on Capitol Hill.

Markets are adjusting to a turbulent world
Rana Foroohar (FT) Aug 18, 2019
A synchronised global recession is likely, punctuated by a step-by-step downturn.

Argentina Needs the Dollar
Mary Anastasia O’Grady (WSJ) Aug 18, 2019
The peso swoons after a presidential vote, showing the risk of an inflation tax.

We need to get back to a pro-trade consensus. But it’ll take a fight.
Frederick W. Smith, William Brock and Charlene Barshefsky (WP) Aug 18, 2019
Engagement is essential to our survival; trade is an integral part of our engagement.

What we should learn from the Great Depression
Robert Samuelson (WP) Aug 18, 2019
Leadership is conspicuous by its absence.

UK Will Face Labor Shortages in a Post-Brexit World
Gary Simmons (Brink) Aug 18, 2019
Post Brexit could create significant challenges for the U.K. labor force. It will start experiencing competition in a shrinking pool with other countries that are offering free movement and more stable currencies attractive for remittances.

Saudi Arabia Can’t Save the Oil Market
Julian Lee (Bloomberg View) Aug 18, 2019
If you’re waiting for a big production cut from the kingdom to rescue the crude market – don’t.

Indonesia Makes a Big Fiscal Bet
Daniel Moss (Bloomberg View) Aug 18, 2019
Joko Widodo is putting money into roads, power plants and airports in pursuit of higher growth. Neighbors will watch closely.

Yield Curve Panic Was an Overreaction, But That Doesn't Mean It Was Harmless
Mohamed Aly El-Erian (Bloomberg View) Aug 18, 2019
If consumers are spooked by breathless coverage in the news media, they could cut spending and start some real trouble.

Low interest rates hurt the poor and vulnerable
Karen Petrou (FT) Aug 19, 2019
Most households have no hope of accumulating savings; they are better off being profligate.

IMF and World Bank must get tough on corruption
Frank Vogl (FT) Aug 19, 2019
This is a particularly good time for a new approach as new leaders take charge at both institutions.

Policymakers can fight next recession by ‘going direct’
Jean Boivin (FT) Aug 19, 2019
On eve of Jackson Hole meeting, the worrying reality is that central banks are out of ammo.

Democracies need retooling if they are to survive
Tony Barber (FT) Aug 19, 2019
They can be modernised and restored, though never to permanent, perfect health.

What if there was a miracle treatment for world poverty? It might already exist.
Francisco Toro (WP) Aug 19, 2019
Giving cash directly to the world’s poorest people is one of those radical ideas that, on second thought, is obvious.

Why Brexit is a strategic disaster for the United States
John R. Deni (WP) Aug 19, 2019
An economically and militarily weakened Britain is nothing to celebrate.

Trump Is Losing the Trade War With China
Jason Furman (WSJ) Aug 19, 2019
The markets doubt tariffs will bring about any major concessions. The U.S. needs a multilateral approach.

Trump Says China Is Manipulating Its Currency. What Can He Do About It?
Edwin M. Truman (PIIE) Aug 19, 2019
No stranger to empty threats, President Donald Trump designated China as a “currency manipulator” earlier this month and has complained about the strong US dollar despite having few tools to deal with it even if action were justified, which is not the case.

US institutions will keep Trump’s currency war at bay, but for how long?
Adam Triggs (Brookings) Aug 19, 2019
Earlier this month, U.S. authorities labeled China a currency manipulator for the first time in 25 years. Adam Triggs calls the move a dangerous escalation in U.S.-China tensions and says the Trump administration’s approach could endanger the United States and global economies.

Yield Curve Inversion: Markets Are Correct to Price In Higher Recession Risk
Tiffany Wilding and Anmol Sinha (PIMCO) Aug 19, 2019
The risk of recession has risen, but it’s not a foregone conclusion.

China’s Central Bank Bids to Join the Grown-Ups
Daniel Moss (Bloomberg View) Aug 19, 2019
Setting a regular date and time for a new rate brings Beijing closer to peers such as the Federal Reserve and European Central Bank.

No, China Isn't Easing. It Just Has a New Benchmark
Shuli Ren (Bloomberg View) Aug 19, 2019
The central bank knows that a policy rate cut would be ineffective, so it’s finding ways to get funding to the corners of the economy that need it.

A Self-Inflicted Recession Is a Bad Soap Opera
Shira Ovide (Bloomberg View) Aug 19, 2019
Even more dangerous than disrupted trade is the message U.S. actions send about wrecking global integration.

100-Year Bonds Are a Dangerous Temptation
Marcus Ashworth (Bloomberg View) Aug 19, 2019
Austria’s century debt has performed much better than Argentina’s on value terms, but even the safest stuff carries real risk at this duration.

No, Germany Isn't About to Go on a Spending Spree
Leonid Bershidsky (Bloomberg View) Aug 19, 2019
Finance Minister Olaf Scholz's 50 billion-euro idea is only a contingency plan at this point.

What If Everyone’s Wrong About China?
Tyler Cowen (Bloomberg View) Aug 19, 2019
Most predictions about its future fail to account for the human capacity to shape events.

The Smart Way Into Emerging-Market Investing
Mohamed Aly El-Erian (Bloomberg View) Aug 19, 2019
There will come a time for long-term investors to broadly buy in, but we are not there yet.

Remembering the Miracle of 1989
Carl Bildt (Project Syndicate) Aug 19, 2019
Thirty years ago this month, a series of peaceful demonstrations in Eastern Europe set off a chain of events that culminated in the collapse of the Soviet Union. Looking back, it is now clear that Europe experienced a miracle in 1989: the story could have had a much darker and bloodier ending.

Managerial quality and productivity dynamics
Achyuta Adhvaryu, Sadish D, Anant Nyshadham, and Jorge Tamayo (VoxEU) Aug 19, 2019
Managerial quality remains low in firms in developing countries. In the context of the Indian garment industry, this column shows that manager characteristics matter for productivity. It argues that firms might not know what constitutes good management or how valuable it is, and that they could benefit from screening and training management in these qualities.

Cash and the economy: Evidence from India’s demonetisation
Gabriel Chodorow-Reich (VoxDev) Aug 20, 2019
Demonetisation in India in December 2016, whilst not reflected in official GDP, led to temporary reductions in employment, output, and credit.

The United States Will Miss China’s Money
Zachary Karabell (FP) Aug 19, 2019
The top casualty of the U.S.-China trade war is Chinese investment in the United States.

Unemployment: Lower for Longer?
Nicolas Petrosky-Nadeau and Robert G. Valletta (FRBSF Econ Letter) Aug 19, 2019
Unemployment is running near its 50-year low, but inflation has not picked up as expected. This suggests that the unemployment rate consistent with stable inflation has fallen. Combining a conventional Phillips curve tradeoff between unemployment and inflation with a noninflationary unemployment rate that can change over time shows that estimates of this unemployment threshold have declined toward 4% in recent years. One possible reason for this decline is improvements in how job matches are made, reflected in unusually favorable job-finding rates for disadvantaged groups.

Only a technical recession? It is all about risks!
Josef Auer, Barbara Böttcher, Dieter Bräuninger, Eric Heymann, Kevin Körner, Jochen Möbert & Jan Schildbach (DB Research) Aug 19, 2019
We see Germany in a technical recession, as we expect another ¼% GDP drop in Q3. Our forecast for 2019 is now 0.3%. Given no indication for a rebound we lowered our 2020 forecast to 0.7%. We acknowledge these revisions do not properly account for the recent accumulation of risks. Given the increasingly fragile state of the global economy, the realization of one or more risks could easily push the economy into a completely different scenario, where growth revisions of a few tenths of a percentage point will not be sufficient. (Also in this issue: German automotive industry, chemical industry, house prices, corporate lending, the view from Berlin, digital politics.)

EU migrants must not be Brexit bargaining chips
FT View Aug 20, 2019
Ending free movement under a no-deal exit risks a repeat of the Windrush scandal.

US sanctions are worsening Venezuela’s agony
FT View Aug 20, 2019
Ending the suffering needs broad diplomatic push and engagement with Russia and China.

Europe must brace for a trio of trade shocks
Martin Sandbu (FT) Aug 20, 2019
It is high time for the EU to unlock the fiscal side of its macroeconomic armoury.

Watch China’s balance of payments data for signs of capital flight
Jonathan Wheatley (FT) Aug 20, 2019
Unrest in Hong Kong could accelerate weakening of the renminbi.

Want to Prevent a Recession, Mr. Trump? Stop Hurting the Economy
NYT Aug 20, 2019
As the administration tries to keep growth going, its trade war weakens it.

Recession Fears Are Overblown
Andy Puzder and Jon Hartley (WSJ) Aug 21, 2019
The yield curve is no longer a reliable predictor, and other economic indicators are strong.

Dodgy data and the health of China’s economy
Gordon Watts (AT) Aug 20, 2019
‘Skepticism about the accuracy’ of the official Chinese statistics has intensified.

Europe’s deadly banking cocktail
Brian Caplen (Banker) Aug 20, 2019
Europe’s banks are facing pressures from all sides and will hardly be able to assist with a eurozone recovery, writes Brian Caplen.

Italian Politics Meet European Rigidity
Bloomberg View Aug 20, 2019
Italy’s governments are mostly to blame for the country’s problems — but the EU should tread carefully.

China Could Use a Libor-Rigging Scandal
Shuli Ren (Bloomberg View) Aug 20, 2019
You need to have a functioning market before you can manipulate it. Don’t worry about any funny business with the new loan prime rate.

Is the ECB Poised to Fire Up the Whirlybird?
Mark Gilbert (Bloomberg View) Aug 20, 2019
For bond investors, the list of never-seen-before happenings is only getting longer.

Italy Stumbles Into Its Next Absurd Crisis
Ferdinando Giugliano (Bloomberg View) Aug 20, 2019
A Five Star-Democrat coalition wouldn’t deliver the economic clarity that the country needs so desperately.

Headed to Recession? Keep an Eye on Business Investment
Conor Sen (Bloomberg View) Aug 20, 2019
But you won’t yet find signs of trouble.

Sometimes It Isn’t the Economy, Stupid
Mihir Sharma (Bloomberg View) Aug 20, 2019
Whether in Hong Kong or Kashmir, government handouts aren’t going to quell protests.

Is Britain Becoming a Failed State?
Chris Patten (Project Syndicate) Aug 20, 2019
Failed states used to be largely the preserve of the developing world, where the institutions of democracy do not have deep roots. But given the extent to which the Brexit campaign has undermined Britain's institutions through lies, it is reasonable to worry that the country will soon come to resemble a tinpot dictatorship.

What Russia Thinks About Multilateralism
Alexander Gabuev and Elena Chernenko (Project Syndicate) Aug 20, 2019
While many in the West wring their hands over the plight of the postwar rules-based international order, it is often assumed that Russia would welcome a new era of unilateralism and great-power politics. But in reality, the Russian leadership's perspective on multilateralism is more complicated than that.

The economic impact of India’s demonetisation
Gabriel Chodorow-Reich (VoxEU) Aug 20, 2019
India's demonetisation in 2016 reduced the volume of currency in circulation by 75% overnight. This column uses new data sources to quantify impacts on economic activity and credit growth after the unprecedented natural experiment. These effects can teach us about the short-run economic disruption and long-run benefits of demonetisation.

History Repeats Itself in Zimbabwe
Tendai Biti (FA) Aug 20, 2019
New president, same old problems.

Federal Reserve should use forward guidance now
Neel Kashkari (FT) Aug 21, 2019
Central bank has not fully exploited this new tool to stimulate the economy.

Cut the Trump Uncertainty Tax
WSJ Aug 21, 2019
His best stimulus policy would be to end his tariff campaign.

Trump can’t soothe markets by blaming his Fed chair
WP Aug 21, 2019
Instead, he should end his pugnacious trade policies and pressure British Prime Minister Boris Johnson to deal reasonably on Brexit.

China's Growth Is Slowing, but not Because of the Trade War
Nicholas R. Lardy (PIIE) Aug 21, 2019
President Donald Trump has repeatedly defended his tariff hikes on China by saying that they are not impeding US economic growth but are a main reason why China’s growth is slowing. “China is doing very, very poorly,” Trump told reporters recently, referring to its economy. “The tariffs have really bitten into China. They haven't bitten into us at all." The Chinese economy is so poor, he asserts, Beijing will soon agree to US terms for a trade agreement. The facts don’t support his claims.

Taming the Currency Hype
Gustavo Adler, Luis Cubeddu, and Gita Gopinath (IMF) Aug 21, 2019
Escalating trade tensions are taking a toll on the global economy and are partly responsible for the recent downward revisions to our growth forecasts for 2019-20.

Economic Growth is Making Many Egyptians Poorer
Amr Ismail Ahmed Adly (Bloomberg View) Aug 21, 2019 Germany Is Only Interested In Saving Itself
Ferdinando Giugliano (Bloomberg View) Aug 21, 2019
It’s taken the threat of a German recession to get the promise of German stimulus. This isn’t how a monetary union like the euro zone is meant to work.

Powell’s Tricky Balance at Jackson Hole
Mohamed Aly El-Erian (Bloomberg View) Aug 21, 2019
The Fed chairman’s speech on Friday is an opportunity to reset expectations in large or small ways.

Finally, Germany Issues a Bond That Nobody Wants to Buy
Marcus Ashworth (Bloomberg View) Aug 21, 2019
Investors have balked at a 30-year note that offers less than zero interest. This isn't likely to signal the end of the bond market bubble.

How I Learned to Stop Worrying and Love the Deficit
Karl W Smith (Bloomberg View) Aug 21, 2019
More countries should follow the U.S. lead and spend more than they take in.

Markets Should Be Worried About the Music Stopping
Satyajit Das (Bloomberg View) Aug 21, 2019
A structural decline in trading liquidity could make things very uncomfortable for investors in the next downturn.

Latin America’s Missing Middles
Jaana Remes and Homi Kharas (Project Syndicate) Aug 21, 2019
Decades of weak growth in Latin America have left large parts of the population economically vulnerable. But by taking advantage of digital disruption, the region has a golden opportunity to nurture faster growth that benefits everyone.

Assessing house prices: Insights from a dataset of price level estimates
Jean-Charles Bricongne and Alessandro Turrini (VoxEU) Aug 21, 2019
The increased post-Global Crisis monitoring of house prices still lacks an effective measure for cross-country comparisons. This column outlines the creation of an integrated database covering advanced and emerging economies on the price per square metre of housing. The model shows that price-to-income ratios vary substantially at the extremes, but that the majority economies converge around the median level. Country rankings based on housing prices in euros versus PPP also vary significantly.

The Great Trade Collapse: An evaluation of competing stories
Hakan Yilmazkuday (VoxEU) Aug 21, 2019
During the Global Crisis, international trade decreased more than overall economic activity, despite standard trade models predicting a one-to-one relationship. This ‘Great Trade Collapse’ has been investigated extensively in the literature, resulting in alternative competing explanations. This column evaluates the contribution of each story using data from the US. The results show that retail inventories have contributed the most to the collapse and the corresponding recovery, followed by protectionist policies, intermediate-input trade, and trade finance. Productivity and demand shocks have played negligible roles.

Does technology hinder development?
Dani Rodrik (VoxDev) Aug 21, 2019
Low-income countries are disadvantaged by the introduction of new technologies due to being unable to access skilled employment opportunities

Why investors keep getting drawn to Nordic noir
Robert Smith (FT) Aug 22, 2019
Aggressive central bank easing forces fund managers into ever- riskier territory.

Trade could combat Brazil’s Amazon deforestation
Bard Harstad (FT) Aug 22, 2019
Export industries can be an ally rather than foe of rainforest protection.

Righteous anger will not win the US-China tech war
James Kynge (FT) Aug 22, 2019
Washington’s tech sanctions will not halt Beijing’s industrial advance.

G7 summit should mark return of western alliance
Risto Penttila (FT) Aug 22, 2019
A new approach to global governance is needed and this meeting is the place to start.

Economic Antidote for a Shrinking America: Immigrants
Patricia Cohen (NYT) Aug 22, 2019
Restaurants, farms and other employers say they need more foreign workers. And economic growth may depend on it, given lower birthrates.

A 100-Year Treasury?
WSJ Aug 22, 2019
With demand high, now is the time to float a really long bond.

The turmoil in Hong Kong stems in part from its unaffordable housing
Economist Aug 22, 2019
While undermining autonomy, the Chinese government has preserved the economy in aspic.

No Deal Brexit: What Will Actually Happen
George Pickering (Mises Wire) Aug 22, 2019
Let's set aside the politically tempting task of speculating about what might happen in the event of a No Deal Brexit, what can we say with certainty will happen?

As Low-Cost Labor Pools Shrink, Will Global Supply Chains Become a Thing of the Past?
Amar Hanspal (Brink) Aug 22, 2019
Globalization, simply put, has run its course. There are new trade changes on the horizon, and a localized approach to manufacturing is imperative for companies to succeed. An outline of each new trend that the industry is currently experiencing.

Move Your Bankers to Paris or Frankfurt ... Or Else
Lionel Laurent (Bloomberg View) Aug 22, 2019
The quest by some in Brussels to weaken the post-Brexit City of London and beef up the euro zone’s finance industry might be self-defeating.

Switzerland Tried Negative Rates in the 1970s. It Got Very Ugly
Stephen Mihm (Bloomberg View) Aug 22, 2019
In the looking-glass world of negative-interest rates, the Swiss are in a special category.

As Jackson Hole Starts, Emerging Markets Lose Faith in the Fed
Shuli Ren (Bloomberg View) Aug 22, 2019
Once a beacon of stability, the U.S. has become a source of tumult. Markets now give global central bankers a clearer read on the economy.

What a Yield-Curve Inversion Really Says About the U.S. Economy
Peter Coy (Bloomberg Businessweek) Aug 22, 2019
A reliable recession indicator has lost some of its power to predict.

Thai Economy Weakens, With a Twist:  The Baht’s Too Strong
Daniel Moss (Bloomberg View) Aug 22, 2019
We’re a long way from 1997, but it’s fair to wonder how long the currency can defy the pull toward a slowdown.

Powell Needs to Side With Markets at Jackson Hole
Jim Bianco (Bloomberg View) Aug 22, 2019
If rate cuts really are stimulative, they will work now to halt a worsening economy, not cause the Fed to “run out of bullets.”

Remember When Governments Used to Run Their Economies?
Conor Sen (Bloomberg View) Aug 22, 2019
Central banks have been alone for too long. Rumblings in Germany and the U.S. hint that fiscal policy could finally come back into play.

Should Government ‘Pick Winners’? It’s Worked Before
Noah Smith (Bloomberg View) Aug 22, 2019
Eight books on what's known as industrial policy show the successes and the failures.

Merkel Didn't Give Johnson 30 Days to Fix Brexit
Leonid Bershidsky (Bloomberg View) Aug 22, 2019
The chancellor's comments are being misinterpreted in Britain, perhaps deliberately.

Economic Growth Rates Look Almost Medieval
Justin Fox (Bloomberg View) Aug 22, 2019
Per-capita GDP growth in some rich countries has been awfully slow lately.

Why the Middle East Is Betting on China
Galip Dalay (Project Syndicate) Aug 22, 2019
Chinese foreign policy in the Middle East is highly transactional, focusing on energy and economics, and avoiding sensitive geopolitical issues. In a region as volatile as the Middle East, however, the question is how long such an approach can be sustained.

The Anatomy of the Coming Recession
Nouriel Roubinic (Project Syndicate) Aug 22, 2019
Unlike the 2008 global financial crisis, which was mostly a large negative aggregate demand shock, the next recession is likely to be caused by permanent negative supply shocks from the Sino-American trade and technology war. And trying to undo the damage through never-ending monetary and fiscal stimulus will not be an option.

Managing the Next Gold Rush
Sharon E. Burke (Project Syndicate) Aug 22, 2019
The seafloor is rich in rare-earth elements and other sought-after minerals, but it also contains barely understood components of the global ecosystem. In pursuing these precious resources, the international community must proceed with care, so as not to trigger an environmental catastrophe.

Recession Update: Is the Yield Curve Still Effective?
Azhar Iqbal (WF) Aug 22, 2019
In order to assess whether recent events represent a material change in the probability of recession, we updated our models to estimate potential risks of a recession in the short-term as well as in the medium-term. Despite warnings from the recent yield curve inversion, our models taken together suggest that near-term recession risk remains limited.

Global recycling crisis should be a wake-up call
FT View Aug 23, 2019
The sharply reduced trade in waste could boost efforts towards reuse.

Powell should set out a more predictable course
FT View Aug 23, 2019
Fed chair’s Jackson Hole speech is an opportunity to better guide investors.

Do not expect the Fed to stop global growth unravelling
Peter Cramer (FT) Aug 23, 2019
Jackson Hole symposium should confirm that policymakers are powerless to avert a downturn.

Central banks have lost much of their clout
Adair Turner (FT) Aug 23, 2019
Monetary policy is no longer enough to keep the economy on track.

‘Greater fool’ theory drives weird world of negative yields
Neil Collins (FT) Aug 23, 2019
Lending at a loss only makes sense if there are other buyers willing to risk bigger hits.

A Gyrating Economy, and Trump’s Volatile Approach to It, Raise Alarms
Peter Baker (NYT) Aug 23, 2019
Mr. Trump’s wild pronouncements on Friday renewed questions about his stewardship of the world’s largest economy even as he escalated a trade war with China before heading to France for the G7 summit.

Just Another Manic Friday
WSJ Aug 23, 2019
Trump and Xi see who can take the most trade pain. Everyone loses.

The IMF Needs an Upgrade
WSJ Aug 23, 2019
George Osborne or Mark Carney could be helpful in a global downturn.

Trump’s trade war shows the reality of ‘America First’ in action
George Will (WP) Aug 23, 2019
In a trade war, as in a real one, people are wounded by friendly fire from their side.

Trade war stalls China’s march of the robots
Gordon Watts (AT) Aug 23, 2019
The high-tech sector takes a hit from the standoff between Washington and Beijing.

China Is Only Nibbling at the Problem of "Zombie" State-Owned Enterprises
Tianlei Huang (PIIE) Aug 23, 2019
China’s economic growth in recent years has been hobbled by the many long-term money-losing firms, often state-owned, dubbed as “zombie companies” because they are effectively insolvent but kept alive only by continuous bank loans and government subsidies.

Is Student Debt Dragging Down the U.S. Economy?
Brink Aug 23, 2019
Student loan debt in the United States has more than tripled since 2014, reaching more than $1.5 trillion in 2018. These loans are changing the culture of America, but just how negatively are they affecting the U.S. economy? We examined the data and found that the rise is not only financially impacting the U.S., but also delaying the timeline for young people to start lives post-college.

Negative Rates Are Coming for Your Savings
Mark Gilbert (Bloomberg View) Aug 23, 2019
Wealthy depositors are already being hit. The less well-off are next in the firing line.

What the Fed Could Learn From Canada
Narayana Kocherlakota (Bloomberg View) Aug 23, 2019
It’s hard to meet goals without deadlines.

The EU’s Next Bad Idea? A So-Called Sovereign Wealth Fund
Ferdinando Giugliano (Bloomberg View) Aug 23, 2019
A $110 billion fund won’t help Europe’s lagging tech sector compete against the U.S. and China.

China’s Tariffs Show Why Trump Isn't Energy's Friend
Liam Denning (Bloomberg View) Aug 23, 2019
The administration’s policies are more drill-baby-drill, less sell-baby-sell.

Whither Central Banking?
Lawrence H. Summers and Anna Stansbury (Project Syndicate) Aug 23, 2019
In an environment of secular stagnation in the developed economies, central bankers’ ingenuity in loosening monetary policy is exactly what is not needed. What is needed are admissions of impotence, in order to spur efforts by governments to promote demand through fiscal policies and other means.

The Unsustainability of Inequality
James K. Galbraith (Project Syndicate) Aug 23, 2019
Rising inequality is symptomatic of a wide range of economic and political problems that are standing in the way of achieving a just and sustainable society. But for all the concern about the income and wealth gap within countries in recent years, there has been surprisingly little acknowledgement of the forces actually driving the trend.

Great bond rally makes traders of investors
Michael Mackenzie (FT) Aug 24, 2019
As coupons shrivel and investors rely on rising prices, bonds are becoming stock-like.

Donald Trump’s war on the Federal Reserve
Edward Luce (FT) Aug 24, 2019
The president has left himself just one tool to stop a recession — bullying Jay Powell.

One Crazy Day Showed How Political Chaos Threatens the World Economy.
Neil Irwin (NYT) Aug 24, 2019
An escalating trade war and unpredictable policy shifts. Also, tweets.

How Slavery Hurt the U.S. Economy
Karl W Smith (Bloomberg View) Aug 24, 2019
Slave labor prevented American capitalism from becoming more efficient more quickly.

The fundamental drivers of cryptocurrency prices
Siddharth Bhambhwani, Stefanos Delikouras, and George Korniotis (VoxEU) Aug 24, 2019
We do not know which characteristics affect cryptocurrency prices, if any. The column argues that there are two fundamental factors that drive prices in the long run: the trustworthiness of the cryptocurrency’s blockchain and the adoption of the blockchain. Cryptocurrencies such as Bitcoin, Ethereum, and Monero are affected by these fundamentals. In some periods prices deviate, but eventually retrace the trend.

Concentration, market power, and dynamism in the euro area
Maria Chiara Cavalleri, Alice Eliet, Peter McAdam, Filippos Petroulakis, Ana Soares, and Isabel Vansteenkiste (VoxEU) Aug 24, 2019
Recent evidence suggests that competitive intensity has been declining in the US. This column aims to contribute to our understanding of these trends in the euro area. It finds that, in contrast to the situation in the US, market power metrics have been relatively stable over recent years and mark-ups have marginally been trending down since the late 1990s. It suggests that more research on the sectoral level and with better data is necessary to analyse the complex welfare and policy implications of these developments.

US, not European, banks more exposed to a slump
FT View Aug 25, 2019
Banks across the continent have been forced to improve efficiency.

Portugal’s bright outlook offers Europe some hope
FT View Aug 25, 2019
Coalition has overseen growing foreign investment and mass tourism.

Ukraine is ready to seize its chance to reform
David Malpass (FT) Aug 25, 2019
The new leadership must revamp agriculture and finance.

What You Haven’t Read About Brazil
Mary Anastasia O’Grady (WSJ) Aug 25, 2019
The Amazon fires are mainly the result of drought, while Bolsonaro’s reforms are paving the way for faster growth.

No end in sight for China and America’s trade warriors
Yang Yao (EAF) Aug 25, 2019
There is a wrongly-placed tendency in China's policy circles to overstate the direct impact of the trade dispute on China's economy and its future growth. While the trade war has serious implications for the multilateral trading system and China's role in it, the dispute is about trade and behind-the-border regulations that can be negotiated and negotiating to take out some of the impediments will be good for China's economic ascendance.

The Summer of 2019
Richard Phillips (Globalist) Aug 25, 2019
In terms of economic contentedness, the summer of 2019 in the U.S. and globally had an eerie feeling of the summer of 1913.

Tide Goes Out for China's Skinny-Dipping Banks
Shuli Ren (Bloomberg View) Aug 25, 2019
An accounting rule change and an economic slowdown are combining to magnify losses on loans and financial assets.

Germany and ECB should do a stimulus deal
Melvyn Krauss (FT) Aug 26, 2019
The eurozone needs a bigger boost than monetary policy can provide.

Bonds with sub-zero yields are a call to action
David Riley (FT) Aug 26, 2019
Governments should respond to consistent distress signals from the bond market.

No-deal Brexit is more likely than ever
Bronwen Maddox (FT) Aug 26, 2019
With scarcely more than a week until parliament returns, opponents have not united behind a plan.

Trump Can Battle China or Expand the Economy. He Can’t Do Both.
Peter s. Goodman (NYT) Aug 26, 2019
The president says Americans must sever commercial dependence on China. He also says he wants powerful economic growth. The trade war threatens to force him to choose.

As Trump Swerves on Trade War, It’s Whiplash for the Rest of the World
Peter Baker (NYT) Aug 26, 2019
At the Group of 7 meeting in France, President Trump changed his approach to the trade war with China time and again, leaving much of the world off balance. “It’s the way I negotiate,” he said.

Global games of chicken are frying the planet
Niall Ferguson (Boston Globe) Aug 26, 2019
From Trump’s trade wars to Brazil’s inferno, the world is on the brink.

Trade war flames scorching global economy
Gordon Watts (AT) Aug 26, 2019
President Trump reiterates that Beijing wants to ‘make a deal’ after China’s Vice-Premier Liu calls for calm.

Monitoring Global Financial Stability
Tobias Adrian, Dong He, Nellie Liang, and Fabio Natalucci (IMF) Aug 26, 2019
We now understand better how financial vulnerabilities can amplify negative shocks and hurt output and employment.

US-China Trade War: The Guns of August
Chad P. Bown (PIIE) Aug 26, 2019
August, which is supposed to be a somnolent month, has erupted in 2019 in a blaze of threats and tariff escalations.

A G-7 Fiasco to Remember
Bloomberg View Aug 26, 2019
Without U.S. leadership, the world is a more dangerous place.

India’s Stimulus Plan Falls Short on Vision
Andy Mukherjee (Bloomberg View) Aug 26, 2019
The government's measures to revive growth lack a cohesive strategy to grab the country's biggest opportunity: exports.

The Big Gamble Not to Follow the Fed
Daniel Moss (Bloomberg View) Aug 26, 2019
Emerging-market central banks are charting more of their own monetary course as the U.S. becomes increasingly chaotic.

For Currency Traders, August Was No Day at the Beach
Shuli Ren (Bloomberg View) Aug 26, 2019
Emerging markets have been getting hammered this month. A less predictable Chinese yuan is only going to make things worse.

Want a U.S. Recession? Try Trump’s China Divestment Plan
David Fickling (Bloomberg View) Aug 26, 2019
President’s trade war order for U.S. companies to get out isn’t just impossible; it would sink the economy.

The French Are Finally Doing Better Than the Germans
Ferdinando Giugliano (Bloomberg View) Aug 26, 2019
France is no longer looking like one of Europe’s walking wounded. Increasingly, that seems to the fate of the export-dependent Germans.

Mexico Is Solidly Middle Class (No Matter What Trump Says)
Noah Smith (Bloomberg View) Aug 26, 2019
The president’s dark rhetoric paints an inaccurate portrait of the country’s economy.

Robots Will Come for Our Jobs. Will We Love Them or Loathe Them?
Faye Flam (Bloomberg View) Aug 26, 2019
There’s hope for a happy transition in one odd discovery: Workers would rather be replaced by a robot than by a human.

Firms Must Drive Africa’s Transformation
Victor Harison and Mario Pezzini (Project Syndicate) Aug 26, 2019
With the launch of a new continental trade bloc, Africa is positioned to compete globally and accelerate its economic development. But success will depend on whether national policymakers and African firms can be mobilized to take advantage of the growth opportunities now available.

The End of Shareholder Primacy?
Michael Spence (Project Syndicate) Aug 26, 2019
The recent decision by America's Business Roundtable to abandon its support for shareholder primacy was a long time coming, and reflects a broader shift toward socially conscious investment. Now that the multi-stakeholder model is receiving the attention it deserves, it will be incumbent on governments to create space for it to succeed.

Party like it’s 1995: Resolving the WTO Appellate Body crisis
Bernard Hoekman and Petros Mavroidis (VoxEU) Aug 26, 2019
In December 2019, the WTO Appellate Body will cease to operate unless the US stops blocking new appointments. This column argues that the Appellate Body should stick to the mandate that was agreed in 1995 and not overstep it, as requested by the US. At the same time, the WTO adjudication process should be reformed by increasing the use of economics in panel reports, by improving the quality of panellists and Appellate Body members, by reducing the politicisation of appointments, and by changing the modus operandi of dispute settlement.

The sterling depreciation and UK price competitiveness
Giancarlo Corsetti, Meredith A. Crowley, and Lu Han (VoxEU) Aug 26, 2019
An immediate impact of the Brexit referendum in 2016 was the large, rapid depreciation of the sterling against all other currencies.The weak pound did not boost UK export volumes, but less clear is whether UK firms lowered their export prices in line with the weaker pound. This column shows that the UK export price response to depreciation depends on the currency in which UK firms invoice their cross-border transactions. Firms invoicing in sterling gained competitiveness by passing the sterling’s weakness through to prices, unlike firms invoicing in vehicle or destination currencies,which adjusted their mark-ups.

Judicial efficiency and firm productivity: Evidence from a world database of judicial reforms
Mathieu Chemin (VoxDev) Aug 26, 2019
Judicial reforms funded by foreign agencies increase firm productivity, but only in specific sectors where contract enforcement is more important.

Hard-Wired to Survive in the US-China Trade War
David De Cremer (EFR) Aug 27, 2019
The escalating friction between the world’s two largest economies – America and China – is not only a traditional battle of economic supremacy but spirals down on winning the war on technological advancement and innovation. Huawei is hard-wired to survive and their strategies, which include the company’s obsession and passion to provide the best service possible has effectively helped them respond to the present crisis.

Negative Interest Rates and Inflation Expectations in Japan
Jens H.E. Christensen and Mark M. Spiegel (FRBSF Econ Letter) Aug 26, 2019
After Japan introduced a negative policy interest rate in 2016, market expectations for inflation over the medium term fell immediately. This can be seen by assessing how prices for Japanese bonds with embedded deflation protection responded to the policy announcement. The reaction stresses the uncertainty surrounding the effectiveness of negative policy rates as expansionary tools when inflation expectations are anchored at low levels. Japan’s experience also illustrates the desirability of taking preemptive steps to avoid the zero interest rate bound.

Macron’s G7 summit calms the storm, for now
FT View Aug 27, 2019
Brexit has already pushed Britain to the margins of global affairs.

Japan Inc wakes up to investor activism in its own backyard
Kana Inagaki (FT) Aug 27, 2019
Recent hostile battles show how woefully unprepared companies are for insurgent shareholders.

Egypt’s economic turnround hailed by investors
Heba Saleh (FT) Aug 27, 2019
Implementation of reforms by regime praised for macroeconomic improvements.

How Trump and Xi Can Both Win Their Trade War
Thomas L. Friedman (NYT) Aug 27, 2019
Each needs to step back for six months and work on a way to get to better, not perfect, or things will turn ugly fast.

Brexit: how not to negotiate
Brian Caplen (Banker) Aug 27, 2019
Negotiations break down when the parties get stuck into hardline positions they cannot retreat from. Bank CEOs can learn from the Brexit mess.

Central Bank Bosses as Lackeys?
Stephan Richter and Uwe Bott (Globalist) Aug 26, 2019
How Trump and Erdogan are like twin brothers.

Should Developing Countries Get Preferential Treatment on Trade?
Anabel González (PIIE) Aug 27, 2019
President Donald Trump thinks that China, India, and other emerging economic powers are taking unfair advantage of the global trading system by calling themselves “developing” countries.

Global Fetters: Insights From Jackson Hole
Joachim Fels (PIMCO) Aug 27, 2019
The institutional “golden fetters” of the interwar period have been replaced by fundamental “global fetters” that severely constrain monetary policy.

Modi Gets Real on the Economy
Mihir Sharma (Bloomberg View) Aug 27, 2019
The best news in years is that India’s government finally seems to recognize the scale of the problems it faces.

A Rainy-Day Giveaway From India’s Central Bank
Andy Mukherjee (Bloomberg View) Aug 27, 2019
RBI Governor Shaktikanta Das’s $24 billion windfall buys the government time to stave off a full-blown economic crisis.

The Fed Shouldn’t Enable Donald Trump
William C Dudley (Bloomberg View) Aug 27, 2019
The central bank should refuse to play along with an economic disaster in the making.

China’s Currency Calm Won't Hold Off the Storm
Mohamed Aly El-Erian (Bloomberg View) Aug 27, 2019
Tensions have eased about the yuan weakening beyond 7 to the dollar, but don’t count on that lasting.

OPEC’s Banking on a Christmas Miracle
Liam Denning (Bloomberg View) Aug 27, 2019
Oil-demand forecasts for the year read more like letters to Santa.

Saving Venezuela
Andrés Velasco (Project Syndicate) Aug 27, 2019
Venezuela was once the pride and democratic example of Latin America. It can be that once again: a free, stable, and productive country, where citizens live in safety and peace – but only if the international community provides support in at least three key areas.

Is Stakeholder Capitalism Really Back?
Joseph E. Stiglitz (Project Syndicate) Aug 27, 2019
We will have to wait and see whether the US Business Roundtable's recent statement renouncing corporate governance based on shareholder primacy is merely a publicity stunt. If America's most powerful CEOs really mean what they say, they will support sweeping legislative reforms.

Hong Kong’s Real Problem Is Inequality
Andrew Sheng and Xiao Geng (Project Syndicate) Aug 27, 2019
A powerful, but oft-ignored factor underlying the frustrations of Hong Kong’s people is inequality. And, contrary to the prevailing pro-democracy narrative, the failure of Hong Kong’s autonomous government to address the problem stems from the electoral politics to which the protesters are so committed.

Flailing at China
Stephen S. Roach (Project Syndicate) Aug 27, 2019
Despite years of denial, there can no longer be any doubt that the US is pursuing a bipartisan containment strategy vis-à-vis China. Whether justified or not, the real problem with this strategy is less the merits of the allegations leveled by US politicians than the incoherence of the Trump administration’s policies to address them.

Challenges in the digital age
Vincent Labhard, Peter McAdam, Filippos Petroulakis, and Lara Vivian (VoxEU) Aug 27, 2019
The fourth industrial revolution is bringing about numerous challenges and opportunities. This column summarises selected takeaways from a recent ECB conference which brought together leading minds from academia, institutions and the private sector on the expected effects of digitalisation on the economy, including labour markets, productivity, investment and inflation, and possible implications for monetary policy.

How Should Canada Respond to US Trade Policy?
Dan Ciuriak (CIGI) Aug 27, 2019
As the global economy faces risks posed by deteriorating economic coordination, Canada must prepare for a rough patch in global economic relations.

The World Bank Was Warned About Funding Repression in Xinjiang
Bethany Allen-Ebrahimian (FP) Aug 27, 2019
A World Bank loan program to a supposed educational project in Xinjiang, China—which has now come under congressional scrutiny—previously faced internal concerns.

Will Trump Break the Yuan?
Salvatore Babones (FP) Aug 27, 2019
The trade war between the United States and China is not going anywhere anytime soon—but the currency war is heating up.

China’s Long March to Technological Supremacy
Julian Baird Gewirtz (FA) Aug 27, 2019
The roots of Xi Jinping’s ambition to “catch up and surpass.”

Trump’s Weird Whoppers at the G-7 Summit
Robin Wright (New Yorker) Aug 27, 2019
The President has proved irascibly intransigent on the world stage. This time, he spouted fabulist views on China, Russia, North Korea, and the environment.

The Real Stakes of Trump’s Trade War With China
Benjamin Studebaker (TNR) Aug 27, 2019
As the media obsesses over each round of tariffs, they're missing a much bigger story about the future of the global economy.

Zeroing in on Germany
Erik Nelson (WF) Aug 27, 2019
The risks of a recession in Germany are rising, but the details underlying today's GDP release show the situation is not quite as dire as the drop in headline GDP would suggest. Still, Germany's economy is clearly struggling, with the uptick in unemployment in recent months perhaps the most concerning sign.

This is a dangerous time to deregulate banks
Brooke Masters (FT) Aug 28, 2019
These days, examiners are much less inclined to put lenders in a ‘penalty box’ to prevent them from growing.

A renminbi ‘weapon’ that is liable to backfire
David Lubin (FT) Aug 28, 2019
There are four good reasons for Beijing to think before shooting.

Europe needs a stronger anchor for fiscal policy
FT View Aug 28, 2019
An EU-wide spending rule would be simpler and clearer than the focus on deficits.

Sub-Saharan Africa’s struggle to attract impact investment
Paul Boynton (FT) Aug 28, 2019
Investors should look beyond financial and green energy sectors for projects of scale.

Introducing a new currency was Zimbabwe’s only viable option
Mthuli Ncube (FT) Aug 28, 2019
If the opposition were in power it would have done the same.

Bond yields across the eurozone look vulnerable
Laurence Fletcher (FT) Aug 28, 2019
Expectations of further European Central Bank support may have run ahead of reality.

After Brexit, a U.S. Trade Deal
WSJ Aug 28, 2019
As Johnson presses Britain’s EU exit, a U.S.-U.K. deal is crucial.

While Wall St. Talks of Recession, Bond Investors Make a Killing
Matt Phillips (NYT) Aug 28, 2019
You should have bought bonds. They’re doing great.

China's Belt and Road paves over rules and rights
Bejamin Zawacki (AT) Aug 28, 2019
Whatever its uncertain economic benefits, China’s BRI is a harbinger and host of a new repressive and illiberal order.

Is this really a currency war or just a tantrum?
Alicia García-Herrero (Bruegel) Aug 28, 2019
Since the People’s Bank of China (PBOC) allowed the yuan to surpass the dreaded level of 7 to the dollar on August 11, rivers of ink have flowed citing a new matter of contention between the U.S. and China, namely using currencies to gain competitiveness or, more simply, a "currency war."

Last Tango In Biarritz: The End Of The G7?
Alicia García-Herrero (Bruegel) Aug 28, 2019
The seemingly omnipotent G7, the meeting of the seven largest developed economies in the world, is weakening continuously and, as the author suggests, this should worry us all.

How long is the head table?
Jan Mazza and Jean Pisani-Ferry (Bruegel) Aug 28, 2019
An empirical assessment of concentration in global collective action.

Fed Chair Powell’s Jackson Hole Remarks: Two Hands When One Is Needed
Tiffany Wilding (PIMCO) Aug 28, 2019
Even with additional cuts, we think economic growth could slow to a below-trend pace and prompt the unemployment rate to rise over several subsequent quarters.

The Fed Needs to Fight Against Trump’s Trade War, Not Trump
Karl W Smith (Bloomberg View) Aug 28, 2019
The central bank’s job is to respond to shocks to the economy, regardless of their source.

The U.S. Is Spending More on Debt Even as Other Rich Countries Spend Less
Justin Fox (Bloomberg View) Aug 28, 2019
In the U.S., interest payments on government debt are rising again after a long decline. That’s weird.

Yes, the Fed Could Still Stop a Recession
Tyler Cowen (Bloomberg View) Aug 28, 2019
The world’s central banks have a lot of power. What's changed is their willingness to use it.

This Tiny Nation Should Beware China's Belt and Road
David Fickling (Bloomberg View) Aug 28, 2019
Colonized by Portugal, invaded by Indonesia, suckered by Australia. Timor-Leste doesn’t need another abusive relationship.

Dudley’s Vision of a Political Central Bank Is Alive. In Europe.
Ferdinando Giugliano (Bloomberg View) Aug 28, 2019
Mario Draghi shows that central bankers can be politicians, too.

If Trump Causes a Recession, How Severe Will It Be?
Michael R Strain (Bloomberg View) Aug 28, 2019
Economic indicators aren’t even pointing to a mild recession. Here's how the floor could collapse.

Corrupt Anti-Corruption Campaigns
Kaushik Basu (Project Syndicate) Aug 28, 2019
The crisis in the Amazon is a stark example of the damage that can be done when governments bow unequivocally to business. But it also highlights a related, damaging, and increasingly common phenomenon: the cynical manipulation of anti-corruption efforts to undermine democracy and advance an authoritarian political agenda.

The Slow Greening of Finance
Andrew Higham (Project Syndicate) Aug 28, 2019
Although the world is not reducing greenhouse-gas emissions to the extent needed to limit catastrophic global warming, major financial players are finally starting to make the shift away from fossil fuels. With recent divestment decisions now rippling across economies, hope of achieving a carbon-free energy future is not lost.

Could a US Recession End the Trade War?
Shang-Jin Wei (Project Syndicate) Aug 28, 2019
In recent economic downturns, the United States has been more willing than normal to cooperate with China to try to spur a global recovery. So, although the Sino-American trade dispute continues to escalate, a US recession later this year or in 2020 may help to ease bilateral tensions.

China’s Digital Economy: Opportunities and Risks
Longmei Zhang and Sally Chen (VoxChina) Aug 28, 2019
China’s digital economy has expanded rapidly in recent years, including both the emergence of new digital industries and the digitalization of traditional sectors. This brings significant opportunities but also potential risks. The blog discusses the pros and cons of digitalization and how the government can do better in maximizing the benefit while minimizing the risks.

How Roman transport network connectivity shapes economic integration
Matthias Flückiger, Erik Hornung, Mario Larch, Markus Ludwig, and Allard Mees (VoxEU) Aug 28, 2019
Against the backdrop of megaprojects such as the TEN-T Core Network or the Belt and Road initiative, assessing the role of transport infrastructure in fostering economic integration has gained renewed interest. While there is clear evidence that reducing transport costs increases economic integration in the short run, this column emphasises that we should be aware of the profound and lasting effects that past infrastructure investments have on economic and cultural integration.

The rise of digital currency
Tobias Adrian and Tommaso Mancini-Griffoli (VoxEU) Aug 28, 2019
New entrants are vying to occupy the space once used by paper bills. This column, part of the VoxEU debate on the future of digital money, proposes a simple framework to make sense of who is attempting to pry our wallets open. It argues that the adoption of new digital means of payment could be rapid and bring significant benefits to customers and society, but that the risks must be tackled with innovative approaches and heightened collaboration across borders and sectors. One approach is for central banks to engage in a public–private partnership with fintech firms to provide a safe, liquid, and digital alternative to cash: synthetic central bank digital currency.

Brexit: The Show That Never Ends
Erik Nelson (WF) Aug 28, 2019
Today's move from U.K. PM Boris Johnson raises the already-high stakes for U.K. Parliament next week. A no-confidence motion in Johnson's government is a distinct possibility, but may not succeed, and other efforts to block "no-deal" next week may be futile.

Argentina’s debt debacle poses a difficult choice
FT View Aug 29, 2019
Addiction to US dollar borrowing is haunting the country once again.

China’s renminbi and the global ring of fire
Paul Hodges and Daniël de Blocq van Scheltinga (FT) Aug 29, 2019
The next international debt crisis is an accident waiting to happen.

Emerging market assets across Asia show effects of gathering gloom
Steve Johnson (FT) Aug 29, 2019
Capital Economics warns falls in stocks and bond yields may have run ahead of reality.

Consumers want fair trade, but not its price
David Pilling (FT) Aug 29, 2019
Tea industry buyers are near monopolies who outgun the smallholders or day labourers.

Central banks can no longer afford to act in isolation
Megan Greene (FT) Aug 29, 2019
International spillovers from monetary policy have been amplified by increased globalisation.

The British economy is not ready for Brexit
Chris Giles (FT) Aug 29, 2019
Even if the disruption is contained, it could cause a meaningful drop in output.

Trump’s trade war could get him kicked out of office
Eugene Robinson (WP) Aug 29, 2019
Xi can afford to play the long game. That’s bad news for Trump.

Major world economies are becoming increasingly isolationist. Except those in Africa.
Fareed Zakaria (WP) Aug 29, 2019
Africans know the only real and sustainable path out of poverty is to expand free markets.

Refinance U.S. Debt While Rates Are Low
Stephen Moore (WSJ) Aug 29, 2019
Taxpayers will save billions if the government takes new low-interest loans to pay off its current liabilities.

China needs a serious bonding experience, and now
William Pesek (AT) Aug 29, 2019
The global economy would be a very different place if China’s debt universe was open for business.

The Trade War Is Suddenly Getting Worse
Chad P. Bown (PIIE) Aug 29, 2019
President Donald Trump’s trade plan announced on August 23 would nearly double the average US tariff on imports from China in the six months between June 14 and December 15, 2019. US tariffs averaged 12.3 percent right before an increase went into effect on June 15. If Trump’s plan is implemented on schedule, the average US tariff on Chinese imports will increase to 24.3 percent.

China's Manufacturing Job Losses Are Not What They Seem
Nicholas R. Lardy (PIIE) Aug 29, 2019
President Donald Trump’s latest misrepresentation about the Chinese economy would have you believe that China’s manufacturing sector is on the ropes and that President Xi Jinping has no choice but to yield to US demands on trade. In July 2019, for example, President Trump tweeted that China has lost 5 million jobs, with 2 million lost in manufacturing, as a result of his tariffs. At the end of the G-7 meetings in Biarritz in August 2019, he said, “They lost 3 million jobs in a short period of time," using a lower number.

Brazil Finds a Sweet Spot Between Cheap Money and a Trade War
Matthew A Winkler (Bloomberg View) Aug 29, 2019
Low interest rates, tame inflation and coming pension reforms bolster the country’s equity market.

The Fed’s Stimulus Might Be Undermining Growth
Noah Smith (Bloomberg View) Aug 29, 2019
What if low interest rates are bad for productivity?

What If There Was a Trade War Truce?
Daniel Moss (Bloomberg View) Aug 29, 2019
Some countries have benefited from the standoff between the U.S. and China. Resolving it could jeopardize that economic boost.

100-Year Treasuries Are The Final Frontier
Marcus Ashworth (Bloomberg View) Aug 29, 2019
If the U.S. Treasury takes the plunge it could significantly alter how interest-rate risk is traded.

What If There Was a Trade War Truce?
Daniel Moss (Bloomberg View) Aug 29, 2019
Some countries have benefited from the standoff between the U.S. and China. Resolving it could jeopardize that economic boost.

The Reforms Kazakhstan Needs
Kassymkhan Kapparov (Project Syndicate) Aug 29, 2019
Appeasing Kazakhstan’s people – and thus stabilizing its politics – must take priority over economic reform. That means, first and foremost, credible and concerted action to root out corruption and strengthen the rule of law.

More Than a Trade War
Koichi Hamada (Project Syndicate) Aug 29, 2019
US President Donald Trump's trade war with China is driven at least as much by anxiety over China's rise as by economic rationality. As the ancient Greek historian Thucydides observed – and as contemporary behavioral economists have confirmed – that kind of insecurity can have disastrous consequences.

The industry anatomy of the transatlantic productivity growth slowdown
Robert J. Gordon and Hassan Sayed (VoxEU) Aug 29, 2019
Since 2005, productivity growth in the US and Europe has dipped below 1%. Using new industry-level from the US and ten EU countries, this column shows that that the industrial composition of the slowdown was similar in Europe and the US. Falling multifactor productivity growth explains both the magnitude and composition of falling productivity growth on both sides of the Atlantic. Decelerating technical change, rather than slowing investment, was the primary driving force in the transatlantic slowdown.

How central bankers can survive populist attacks
FT View Aug 30, 2019
Rate-setters should remain calm and tell the unvarnished truth.

China’s ‘helicopter money’ is blowing up a bubble
Arthur Budaghyan (FT) Aug 30, 2019
Investment implications go far beyond the mainland’s markets.

Fed can ease the supply of credit but not demand
Joe Rennison (FT) Aug 30, 2019
Markets may be overestimating central bank’s ability to reverse tumultuous events.

India’s efforts to stifle crypto could be doomed to fail
Benjamin Parkin (FT) Aug 30, 2019
Government’s stance seems at odds with policy to embrace tech that can digitise the economy.

Lagarde’s IMF legacy holds clues to her ECB presidency
James Politi (FT) Aug 30, 2019
French appointee’s record rests on political savvy and Argentina’s $57bn bailout.

Negative rates are a risk investors have not seen before
Merryn Somerset Webb (FT) Aug 30, 2019
It is virtually impossible to predict where the best place to put your money will be.

Enter the dragon on the road to a trade war
Paul Blustein (AT) Aug 30, 2019
A new book shows how China's state capitalists overwhelmed the WTO – and how Trump is breaking it.

Argentina’s Mess Doesn't Herald a Comeback for Latin America’s Left
Mac Margolis (Bloomberg View) Aug 30, 2019
President Macri’s primary loss is a warning to reformers that voters want results.

Britain’s Brexit Breakdown
Philippe Legrain (Project Syndicate) Aug 30, 2019
With both hardline Brexiteers and diehard Remainers having rejected the only available deal for the United Kingdom to exit the European Union, the pragmatic center is being squeezed out of British politics. As each side ups the ante, Brexit is now an all-or-nothing fight to the death among absolutists.

Investor ambiguity, leverage cycles, and asset prices
Marzio Bassanin, Ester Faia, and Valeria Patella (VoxEU) Aug 30, 2019
Macroeconomic models with credit frictions do a good job of explaining debt falls during financial crises, but fail to account for pre-crisis debt increases and level pro-cyclicality. This column introduces a model in which investors’ beliefs about future collateral values are non-linear. Greater ambiguity optimism during booms and greater aversion during recessions closely model the empirical shifts seen before and during financial crises, highlighting the joint role of financial frictions and beliefs distortions for market developments.

What Does a Rising Baht Mean for Thailand's Economy?
Phornchanok Cumperayot (Diplomat) Aug 30, 2019
A closer look at the economic implications of recent currency appreciation for the country.

Poland’s Leaders Are the Better Trumps
Mitchell A. Orenstein (FP) Aug 30, 2019
Poland’s ruling Law and Justice government has managed to make nationalist populism an economic and electoral success.

India: In-dire Shape
Brendan McKenna and Nick Bennenbroek (WF) Aug 30, 2019
Over the last year, India's economy has struggled to gain traction, highlighted by a wide GDP miss in Q1-2019. Leading indicators of economic activity have been underwhelming and proved to be prescient of a further slowdown in Q2.

Trump’s spat with Powell is a conflict for the ages
Mark Vandevelde (FT) Aug 31, 2019
Past US presidents have had much cosier relationships with Federal Reserve chairs.

Bond market not betting on China reviving growth
Michael Mackenzie (FT) Aug 31, 2019
Drive into haven assets points to deeper worries than just the trade war.

Only the Fed Can Save Us
Jerome Powell and the Federal Reserve must stand up to Trump. If they don’t, the American economy is heading for disaster.

Parts of America may already be facing recession
Economist Aug 31, 2019
Slowdowns in housing construction and manufacturing are ominous.

Asia Should Fix Its Megacities, Not Move Them
Adam Minter (Bloomberg View) Aug 31, 2019
Shifting bureaucrats to Borneo isn’t going to solve the problems faced by the millions still living in Jakarta.

The Trump Narrative and the Next Recession
Robert J. Shiller (Project Syndicate) Aug 31, 2019
So far, with his flashy lifestyle, the US president has been a resounding inspiration to many consumers and investors. But his personal narrative is unlikely to survive an economic downturn, because people pull back during such periods and reassess their views and the stories they find believable.

Two Systems, One World
Joschka Fischer (Project Syndicate) Aug 31, 2019
Like the twentieth-century Cold War between the United States and the Soviet Union, the new rivalry between China and the West is a contest between fundamentally incompatible political systems. And the idea that freedom and democracy will prevail can no longer be taken for granted.

Brexit, the Novel
Simon Johnson (Project Syndicate) Aug 31, 2019
If UK Prime Minister Boris Johnson had to worry about the value of the pound or the fragility of the British economy, he would need to be much more careful. But the British are resilient, the Bank of England will take the necessary actions, and the value of the pound does not matter much – all of which means that Johnson could win.

For Africa, Going Green Is Not a Luxury
Carlos Lopes (Project Syndicate) Aug 31, 2019
How can Africa realize economic prosperity without contributing further to climate change? The solution lies in a kind of Green New Deal – a comprehensive strategy for achieving sustainable growth, including through coordinated, large-scale investment in renewable-energy deployment.