Global Economy

admin August 23, 2019

FOR A CASE study in the complexity of transitions from central planning, consider the knotty mess that is China’s interest-rate system. More than 40 years after Mao Zedong died, the country is an economic superpower, yet it still struggles to manage bank lending using interest rates, rather than through heavy-handed interventions such as credit quotas. […]

admin August 22, 2019

SHAWNEA ROSSER earned upwards of $29 an hour when she worked for General Motors in Dayton, Ohio. But in 2008 the factory closed. Years later the building was bought by Fuyao Group, a Chinese multinational company that makes glass. The new American managers promised that the “historic” project would “give people jobs, and give a […]

admin August 22, 2019

TIDJANE THIAM is not the first non-Swiss chief executive of Credit Suisse. His American predecessor, Brady Dougan, held the job for eight years. But Mr Dougan was an insider, having been at the firm for ages. Mr Thiam was anything but. A citizen of France and Ivory Coast, where he was a government minister in […]

admin August 16, 2019

IN THE AUTUMN of 2008, strange and novel things happened in financial markets, such as the emergence of negative yields on Treasury bills. In times of fear, the safest assets are at a premium. What was once strange is now ordinary. Negative yields are a familiar feature of European bond markets. But such is the […]

admin August 16, 2019

SINCE BRITAIN voted to leave the European Union (EU) in June 2016, Leavers have been gloating. Despite the Remain camp’s dire predictions, the economy seemed to trundle on well enough. But the crowing is dying down. Figures released on August 9th showed that Britain’s GDP shrank in the second quarter. And a growing body of […]

admin August 15, 2019

“THERE’S TARIFFS on games and tariffs on toys—try explaining tariffs to your little boy. Santa’s workshop is struggling, you’ll find yourself saying. I think the reindeer are backed up with their sleighing.” Wendy Lazar, who runs a company called I Heart Guts, submitted this peeved poem to the United States Trade Representative (USTR) in June. […]

admin August 8, 2019

CARL VON CLAUSEWITZ, the Prussian military theorist, never wrote about currency wars. But some policymakers see them in his terms: as the continuation of trade politics by other means. That, at least, is how the Trump administration views China’s decision on August 5th to let its currency weaken past seven yuan to the dollar for […]

admin August 2, 2019

THE MITTELSTAND, exports and thrift—all are matters of German national pride. Thanks to them Germany has run the world’s biggest current-account surplus since 2016, last year just shy of $300bn (7.3% of GDP). This sign that it saves more than it invests at home, and sells abroad more than it imports, has earned the ire […]

admin August 2, 2019

INTEREST RATES set by the Federal Reserve have been rising since 2015. The gradual approach, explained the Fed’s chairman, Jerome Powell, last September, was intended to leave time to see how well the economy could absorb each raise. “So far the economy has performed very well, and very much in keeping with our expectations,” he […]

admin August 1, 2019

FOR A RICH economy, a growth rate beginning with a five would be cause for ecstasy. For India, it is a huge disappointment. Its most recent quarterly growth figure translates into an annualised rate of only 5.8%, the fourth consecutive quarterly slowdown. That is slower than China (a 6.2% annualised rate in the second quarter […]