1/5 It's not so much Atlanticism but international relations more generally that will remain in retreat no matter who wins the US election, and although the world tends to be obsessed with the US and with its bilateral relationships, this retreat won't...
3/5 intensify, and anti-foreign and anti-immigrant feelings rise, and I think this remains a global issue. Perhaps because of its obsession with the US and with, more recently, the Trump circus, much of the world (and the global press) seems to focus on bilateral problems the...
4/5 US has with Europe, China and Russia, but in fact the three have equally, and often more, serious problems with many of their own immigrants, neighbors and international relationships, and this says nothing about either intra-European conflict or similar problems affecting...
5/5 India, the UK, Saudi Arabia, Brazil etc. Unfortunately I think the widespread desire to turn inwards and reject "foreigners" is structural, based on domestic economic imbalances, and so will continue for a few more years before reversing.
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1/12
A Tsinghua-related think tanks argues that "China should issue 30 trillion yuan in treasury bonds to swap local governments’ hidden liabilities to re-energise growth momentum and cut off financial risks at their root."
via @scmpnewssc.mp/gz8bj?utm_sour…
2/12
This would help in two ways, according to the report. It would transfer debt from local government balance sheets to the central government balance sheet, giving them more breathing space to prop up the economy, and it would reduce interest payments.
3/12
But this is what comes of treating a systemic issue incrementally. The problem is not that local governments have too much debt. The excessive debt burden of local governments is actually a symptom of the real problem. ft.com/content/630f82…
1/8 A China Finance 40 Forum research piece by Yu Fei and Guo Kai argues that when adjusted for purchasing power and for volumes, Chinese consumption is much higher than the current consensus. pekingnology.com/p/chinas-consu…
2/8 They are probably right, although I would caution that using purchasing power adjustments in a system in which producer prices are highly subsidized by households is likely to substantially overstate the real extent of the purchasing power adjustment.
3/8 But while Yu and Guo do not misconstrue the implications of their work for China's internal and external imbalances, I suspect that quite a few analysts will argue that this study shows that China does not have an underconsumption problem.
1/6 A decision by China to offer more debt relief could be a “game changer for the poor and the system,” said Kevin Gallagher, the director of the Boston University Global Development Policy Center. “It’s really in China’s strategic interest to do that.”
2/6 Ironically, debt relief is also in the economic interest of creditor countries, especially if, as in the case of China, the economy is highly dependent on export surpluses.
That's because capital flows are just the reverse of trade flows.
3/6 To put it another way, every dollar an overly-indebted developing country earns from its exports must be recycled, either in the form of debt repayment or in the form of imports. The less that goes to the former, the more that is available for the latter.
1/8 The euro is up 14% against the dollar this year, as well as against the yuan (11%) and the yen (4%), driven by financial inflows rather than by economic fundamentals (i.e. higher relative productivity grown).
2/8 If sustained, it will almost certainly have an adverse impact on EU manufacturing. In that case ECB rate cuts may keep unemployment from rising (by boosting domestic consumption), but they won't prevent the EU economy from shifting out of manufacturing towards services.
3/8 It seems absurd that major, open economies like the EU and the US should allow imbalances in their domestic economies to be determined by changes in global financial flows, and especially by changes in the way less open surplus countries decide to balance their surpluses.
1/4 I just finished Martin Daunton's excellent survey and analysis of the last 100 years of globalization. There is an enormous amount of material here (nearly 900 pages) and it may not be an easy read for those who aren't already very familiar with much of this history.
2/4 But for those who are, or who want to be, it's well worth the effort. While the book is ostensibly about the process of globalization, and the role of government and government institutions in that process, especially in pivotal periods during the 1930-40s, the 1970s and...
3/4 in the past decade, a major theme is the enormous distortions caused by the unfettered flow of capital, the ways in which these flows dislocated domestic economies, and the various (mostly unsuccessful) attempts individually and collectively to control them.
1/4 Good John Authers article on business profits in the US: "After-tax profits account for an unprecedented 10.7% of gross domestic product, when in the last 50 years of the 20th century, they never exceeded 8%."
@johnauthers_ bloomberg.com/opinion/articl…
2/4 "The only time approaching their current share of the economy was in 1929 on the eve of the Great Crash. If the nation is to deal with inequality, money must be redistributed from somewhere; corporate profits are an obvious source of funds."
3/4 Speaking of 1929, we need to re-read Marriner Eccles (FDR's Fed chairman) on the relationship between income inequality, weak domestic demand, rising debt needed to boost domestic demand, and the eventual collapse in production once rising debt can no longer be sustained.