Interesting Items - Jan 8

Fiscal Policy Related Issues:

Fiscal Austerity Debate – An Interesting and Controversial Argument for Austerity from Economist Anders Aslund

Economist Joe Stiglitz on Post-Crisis Crises

Stiglitz makes an important point that is not widely appreciated:

“America’s overall trade deficit will not disappear without an increase in domestic savings and a more fundamental change in global monetary arrangements. The former would exacerbate the country’s slowdown, and neither change is in the cards. As China increases its consumption, it will not necessarily buy more goods from the United States. In fact, it is more likely to increase consumption of non-traded goods – like health care and education – resulting in profound disturbances to the global supply chain, especially in countries that had been supplying the inputs to China’s manufacturing exporters.”

Should the US Get Rid of Farm Subsidies? - According to Washington Post's Robert Samuelson, the answer is YES.

Emerging Market Related News:

Financial Reforms in China

Emerging World Consumers