Commodities Drop Looks Secular, Not Cyclical
www.bloomberg.com/opinion/articles/2018-11-30/commodities-drop-looks-secular-not-cyclical
The Stock Market’s Dangers Are Easier to See Now
Attention Economy
Friday, November 30, 2018
Trade and Manufacturing Jobs
Paul Krugman notes:
“…even countries that run huge trade surpluses, like Germany, have seen big declines in manufacturing as a share of employment. Trade just isn’t the main story. What’s happening instead is that as overall spending grows, an increasing share goes to services, not goods. Consumption of manufactured goods keeps rising, but technological progress lets us produce those goods with ever fewer workers; so the economy shifts toward services.”
Related:
Foreign Car Brands versus American Car Brands
www.bloomberg.com/opinion/articles/2018-11-29/chevrolet-sedans-suffer-while-toyota-and-honda-hang-onThursday, November 29, 2018
Emerging Markets are Back
That Emerging Markets Rally Might Finally Be Real
www.bloomberg.com/opinion/articles/2018-11-29/ashmore-group-the-emerging-markets-rally-might-be-real
UBS Report: Thinking strategically about Emerging Markets
Monday, November 26, 2018
US Monetary Policy - Future Path of Policy Interest Rates
US Economic Update:
https://www.nytimes.com/2018/11/28/us/politics/us-economy-health-recession.html
Fed Chairman Powell on Financial Stability
https://www.federalreserve.gov/newsevents/speech/files/powell20181128a.pdf
Fed Vice-Chair Clarida on Data Dependence and Future Interest Rate Path
https://www.federalreserve.gov/newsevents/speech/files/clarida20181127a.pdf
Harvard economist Jeffrey Frankel notes:
https://www.nytimes.com/2018/11/28/us/politics/us-economy-health-recession.html
Fed Chairman Powell on Financial Stability
https://www.federalreserve.gov/newsevents/speech/files/powell20181128a.pdf
Fed Vice-Chair Clarida on Data Dependence and Future Interest Rate Path
https://www.federalreserve.gov/newsevents/speech/files/clarida20181127a.pdf
Harvard economist Jeffrey Frankel notes:
A Trade War is No Reason to Ease Monetary
Policy
“Adverse trade
developments are a negative supply shock. Skillful monetary policy can help
offset a negative demand shock, but can do little or nothing to offset a supply
shock. Slower growth and higher prices are inevitable effects. The Fed
understands that if it were to apply monetary stimulus in an effort to prolong
the current expansion artificially (as Trump has pressured it to do), the
result would be to fuel inflation.”
Nobel Prize winning economist Robert Shiller notes:
Silent Inflation
“An inflation
target of a few percentage points may seem to promote stability, and perhaps it
really does. But we need to consider the possibility that it may lead to subtle
misperceptions that have the opposite effect on the stability of our judgments.”
Trump’s Disastrous Trade Policies
After Losing $1 Billion to Tariffs, General
Motors Announces 14,000 Layoffs
Steel Tariffs and Hot Economy Take Toll on
Infrastructure Projects
Trump’s
trade-policy uncertainty deters investment
http://review.chicagobooth.edu/economics/2018/article/trump-s-trade-policy-uncertainty-deters-investment
Trump’s Protectionist Quagmire
Trump’s Protectionist Quagmire
Bitcoin versus Bolivar - Race for the Worst Performing Currency of 2018
Bolivar has declined even more than Bitcoin so far this year:
www.washingtonpost.com/business/2018/11/26/only-currency-worse-than-bitcoin-is-venezuelas/
www.washingtonpost.com/business/2018/11/26/only-currency-worse-than-bitcoin-is-venezuelas/
Friday, November 23, 2018
Work Requirements for Medicaid Eligibility - Law of Unintended Consequences
Arkansas’s Medicaid experiment has proved disastrous
Are work requirements inherently, irredeemably flawed?
Wednesday, November 21, 2018
Moral Principles and US Foreign Policy
Trump’s Black Friday Sale: Oil, Guns and
Morals
Related:
https://www.newyorker.com/news/news-desk/trumps-utter-denial-about-saudi-arabia-and-its-crown-prince
For Trump, the bottom line on Saudi Arabia
takes precedence over human rights
Sunday, November 18, 2018
China - Long-Term Socio-Economic and Political Developments
The Land That Failed to Fail [Graphics Rich and Insightful]
https://www.nytimes.com/interactive/2018/11/18/world/asia/china-rules.html
www.nytimes.com/interactive/2018/11/18/world/asia/china-social-mobility.html
The World, Built by China
The World, Built by China
--
Related:
Tough economic reforms may help in the long run
https://www.bloomberg.com/news/articles/2018-11-20/china-s-economy-under-xi-slower-safer-and-more-productive
Tsinghua University may soon top the world league in science research
Saturday, November 17, 2018
Agglomeration Effects and Regional Concentration
SUPERSTAR EFFECT WINS AGAIN AS AMAZON
CHOOSES NEW YORK, WASHINGTON FOR HQ2/3
Related:
https://www.newyorker.com/tech/annals-of-technology/the-new-york-hustle-of-amazons-second-headquarters
http://www.themoneyillusion.com/the-magnificent-seven/
https://www.theguardian.com/commentisfree/2018/nov/14/amazon-hq-what-bezos-choice-says-about-us-societyhttp://www.themoneyillusion.com/the-magnificent-seven/
www.washingtonpost.com/business/2018/11/16/big-city-paradox-theyre-getting-richer-losing-electoral-clout/
--
Rise of the Creative Class Worked a Little Too Well
Why Big Cities Thrive, and Smaller Ones Are Being Left Behind
https://www.nytimes.com/2017/10/10/business/economy/big-cities.htmlInternational Politics
Malaysia – A Bright Spot for Democracy
www.bloomberg.com/opinion/articles/2018-11-17/can-malaysia-s-mahathir-mohamad-revive-faith-in-democracy
Autocrats versus Populists
Autocrats versus Populists
Joshua Kurlantzick notes:
“Autocratic populists like Orban — leaders who win democratic elections and then undermine democratic institutions and norms without becoming outright dictators — have gained control of Brazil, the Philippines, Turkey, Hungary, Venezuela and Poland, among other nations, in recent years. While these leaders continually pit “the people” against supposedly corrupt elites, they often still hold free (if not always fair) elections. But in office, they act autocratically to unwind the conventions and institutions of democracy. This distinguishes them from populists (such as incoming Mexican president Andrés Manuel López Obrador, those who have recently run Greece and a host of other politicians in the West) who embrace populist economic messages and even the elite-popular divide but still mostly work within democratic constraints and rules.”Thursday, November 15, 2018
2018 Mundell Fleming Lecture - US Monetary Policy Spillovers
Mundell-Fleming Lecture: The Spillovers from Easy Liquidity and its Implications for Multilateralism
Related:
Aging Population and Long-Term Fiscal Sustainability
Lessons from Japan -
How Japan can cope with the 100-year-life society
How Japan’s prime minister plans to cope with daunting demography
The Tenuous Myth of Japan’s Fiscal Infallibility
China's Economic Rebalancing
Domestic policies (aimed at reining in credit and investment-driven growth), and not trade disputes, are slowing China’s economic growth
Tuesday, November 13, 2018
History of Financial Crises [Updated]
Hedge fund billionaire Ray Dalio on Rising Inequality
Ray Dalio’s Book – Principles for Navigating Big Debt Crises [FREE PDF COPY]
Monday, November 12, 2018
Italian Budget Drama
An Italian budget showdown underlines the need for euro-zone reform
Luigi Zingales on the Italy-EU fight over budget rules:
Sunday, November 11, 2018
Saturday, November 10, 2018
Premier League - Money and Sports
Der Spiegel special report: Manchester City Exposed:
Chapter 1: Bending the Rules to the Tune of
Millions
Chapter 2: The Secret 'Project Longbow'
Chapter 3: Recruiting Pep Guardiola
Chapter 4: A Global Empire
Thursday, November 8, 2018
US Monetary Policy - Rules versus Discretion
Fed Keeps Rates Unchanged and Signals December
Increase Is on Track
Rules Would Make Monetary Policy More
Transparent, Independent
Jay Powell’s Fed and the Right Monetary
Policy Rule
China - Economic Update
A Fifth of China's Housing Is Empty. That's
50 Million Homes
The Global Impact of a Chinese Recession
The Myth of China’s Forced Technology Transfer
Political Science – Democracy and the Nation State
Is More Democracy Always Better Democracy?
Related:
Revenge of the Nation State
Yascha Mounk notes:
“Across the world,
party systems that seemed frozen a few decades ago have rapidly thawed, then
boiled. Populist insurgents have celebrated unprecedented victories by
promising to drain the swamp and send the political caste packing. In many
democracies that political scientists once considered stable and secure,
elected strongmen are putting immense pressure on the judiciary, restricting
the freedom of the press, and curtailing the rights of the opposition.
These countries
have vastly different institutions: some have the kinds of parliamentary
systems favored by Rosenbluth and Shapiro, others the system of proportional
representation that the two disdain. Yet populists have been able to gain
ground in all of them. The reason, it seems, lies less in the institutional
arrangements that divide these countries than in the larger cultural and
economic trends that they have in common—trends like migration, economic
discontent, and the rise of digital technology.”
Related:
Revenge of the Nation State
Wednesday, November 7, 2018
Tuesday, November 6, 2018
Monday, November 5, 2018
World’s New Economic Growth Engines
The World’s New Economic Engines
Aviation Boom in India
The Irresistible Urge to Build Cities from Scratch
https://www.bloomberg.com/news/features/2018-11-02/the-irresistible-urge-to-build-cities-from-scratch
The path to economic development is growing more treacherous, again
The Future of Economic Convergence
https://www.project-syndicate.org/commentary/future-of-economic-convergence-by-simon-johnson-2018-10
The Reforms China Needs
Sunday, November 4, 2018
Ease of Doing Business Rankings
World Bank’s Ease of Doing Business
Most criticisms of the Doing Business rankings miss the point
How the big emerging economies climbed the World Bank business ranking
--
Relevance of World Bank Ratings:
“As economists Mary Hallward-Driemeier and Lant Pritchett have noted, where the informal economy thrives and regulations are poorly enforced, the de jure regulations measured by the World Bank are often only tangentially related to the de facto processes that businesses encounter.”
Related:
Besley, Timothy. 2015. "Law, Regulation, and the Business Climate: The Nature and Influence of the World Bank Doing Business Project." Journal of Economic Perspectives, 29(3): 99-120.
Hallward-Driemeier, Mary, and Lant Pritchett. 2015. "How Business Is Done in the Developing World: Deals versus Rules." Journal of Economic Perspectives, 29(3): 121-40.
Friday, November 2, 2018
Emerging Markets - Crisis and Political Change
Matt O'Brien notes:
“Brazil’s economy has been going through a fairly standard emerging-markets crisis. It started in the early 2000s when the global commodity boom sent Brazil’s growth up so much that households began borrowing a lot more, and foreign money came pouring in to try to get a piece of the pie. This was good while it lasted, but the problem is that it didn’t last.
By 2014, all this had gone into reverse: Commodities had collapsed, consumers had slowed down their borrowing, and, in part because of the end of the U.S. Federal Reserve’s quantitative easing program, money that had gone to Brazil in search of higher returns now returned to the United States….
In normal times, this kind of economic failure would just be a political one for the party in power. It would lose the next election to its main rival. But these were not normal times. A pervasive corruption scandal at the state-owned oil company implicated not only the center-left Workers Party, but also the center-right Democratic Movement party. That meant there was an opening for someone to argue that it was time to throw all the bums out — and with a vigor that wasn’t necessarily compatible with democratic niceties”.
Update:
Populism's Common Denominator by Barry Eichengreen
Update:
Populism's Common Denominator by Barry Eichengreen
Thursday, November 1, 2018
Talent and Performance
You’ve Become Rich. That Doesn’t Mean You’re Great at Everything.
Harvard’s Sendhil Mullainathan notes:
“Success and wealth that move from one arena to another often breed inefficiency.
The economists Alan Benson at the University of Minnesota, Danielle Li at the Massachusetts Institute of Technology and Kelly Shue at Yale illustrate the perils of a variant of this in the corporate world. Good salespeople are not necessarily good managers of sales-people. Yet the scholars find that firms pick their managers based simply on sales performance. The result is that successful salespeople are promoted — and turned into mediocre managers.”
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