News & Commentary:

Articles/Commentary

Wall Street's frustrations in China and Hong Kong rise
Tabby Kinder (FT) Feb 1, 2022
Groups flag concern about new regulation as Bank of America reviews job levels in territory.

Who benefits from Japan's panic over ageing?
Leo Lewis (FT) Feb 1, 2022
Outsourcing jobs overseas makes sense but corporate Japan may not be ready.

Why we're no longer 'team transitory'
Claire Jones (FT) Feb 1, 2022
Inflation may well disappear later this year. That doesn't make it any less painful in the present for some.

A Normal Supply Chain? It's 'Unlikely' in 2022.
Peter S. Goodman (NYT) Feb 1, 2022
The chaos at ports, warehouses and retailers will probably persist through the year, and perhaps even longer.

Xi Jinping's Year of the Tiger
WSJ View Feb 1, 2022
The stage-managed Olympics can't conceal economic worries.

If America Doesn't Set the Digital Trade Agenda, China Will
Robert B. Zoellick (WSJ) Feb 1, 2022
A chance for Biden to defy protectionists on the left, rally allies, create jobs and promote economic growth.

Biden must end this ruinous solar power trade war with China
WaPo View Feb 1, 2022
Transitioning off fossil fuels — not propping up a small domestic industry — must be the priority.

Powell's Fed has Asia bracing for a crash s
William Pesek (AT) Feb 1, 2022
Asia's central banks are doing their jobs in ways Fed Chairman Jerome Powell won't. From Seoul to Singapore to Wellington, officials are actively hitting the brakes as inflation risks intensify. They are getting ahead of the inflation curve. The Fed, meantime, continues to talk about a rate hike. This uncertainty is making for some choppy trading in Asian asset markets.

ECB must tighten now to avoid sharper correction later
Jürgen Stark (OMFIF) Feb 1, 2022
Independent central bankers are not known for taking undue risks. But what happens when they misjudge sharply rising inflation rates and fail to live up to their mandate? The core mandate of the European Central Bank is to ensure a stable price level. However, the governing council has neglected increasing signs of a prolonged and unacceptably higher inflation that could become self-reinforcing.

What Investors Can Expect from High Inflation and Rate Hikes
K@W Feb 1, 2022
In a recent LinkedIn Live panel titled "Investing in a High Inflation World," Wharton finance faculty weighed the likely outcomes of the U.S. Federal Reserve's attempts to fight inflation.

The Fed Knows What It Needs to Do. Now Comes the Tricky Part.
William C Dudley (Bloomberg Opinion) Feb 1, 2022
The central bank has to balance timing, magnitude and the mix of levers in tightening monetary policy.

How Worried Should I Be About Soaring Inflation?
Erin Lowry (Bloomberg Opinion) Feb 1, 2022
Don't panic, but do think about how to adjust your budget for higher prices and potentially higher interest rates.

A U.S. Digital Dollar Should Serve the Public, Not Banks
Lev Menand and Morgan Ricks (Bloomberg Opinion) Feb 1, 2022
Americans shouldn't settle for a "skim milk" version of a central bank currency that's watered down to benefit financial institutions.

India's Plan for Post-Pandemic Economy Is a Risky Ploy
Andy Mukherjee (Bloomberg Opinion) Feb 1, 2022
Modi has ambitions to harness his country's youth. But if things go wrong, progress might skip a generation.

Rethinking Migration in Latin America
Erika Mouynes and Meghan Lopez (Project Syndicate) Feb 1, 2022
Migrant waves in Latin America are growing and will continue to cause humanitarian crises across the region until the root causes of displacement are addressed. The worsening situation demands a new compact to coordinate and intensify the efforts of donors, governments, and aid organizations.

The Winter of Our Discomfort
Mohamed A. El-Erian (Project Syndicate) Feb 1, 2022
From the pandemic and geopolitical tensions to broader macroeconomic developments, new obstacles to "normality" seem to be cropping up everywhere. As the uncertainties continue to mount, the risk of misjudgments and policy errors at all levels of society will grow.

The Fed's Wary Embrace of Digital Dollars
Kenneth Rogoff (Project Syndicate) Feb 1, 2022
It is not difficult to fathom why the United States' central bank is especially resistant to any quantum change in the existing financial system. But while policymakers' reluctance to rush into launching a digital dollar is understandable, that is no excuse for the slow pace of cryptocurrency regulation.

Argentina and the IMF Turn Away From Austerity
Joseph E. Stiglitz (FP) Feb 1, 2022
Last week's agreement may set a better precedent for dealing with debt levels around the world.

The Fed is too late to remove the punchbowl
Martin Wolf (FT) Feb 2, 2022
Policy is still aggressively loose, even though the recovery and surge in inflation have long been clear.

The great resignation is not going away
FT View Feb 2, 2022
Tight US labour market and changing worker attitudes will challenge employers.

IMF's Argentina deal needs tougher conditions
FT View Feb 2, 2022
Broader steps are required to tackle long-running structural problems.

The US doesn't need CPTPP to assert itself in the Asia-Pacific
Alan Beattie (FT) Feb 2, 2022
Trade deals don't automatically mean political alignment or influence: actual firepower is more important than the economic kind.

Has the Fed 'put' been put to bed?
Liz Ann Sonders (FT) Feb 2, 2022
Don't count on the central bank intervening over market volatility.

Inflation squeezing US stocks and profits
David P. Goldman (AT) Feb 2, 2022
Labor and raw materials costs are squeezing corporate profit margins in the United States, as prices received lag input costs. Major US corporations raised prices fast enough during the first three quarters of 2021 to stay in front of the inflation wave, but rising costs, especially for labor, are now overtaking them.

India's e-rupee follows China's digital currency lead
William Pesek (AT) Feb 2, 2022
The same week New Delhi shared plans for a central bank digital currency, or CBDC, Beijing was gearing up for its biggest trial yet at the Winter Olympics, which start on Friday. The Reserve Bank of India (RBI) is joining the People's Bank of China (PBOC) by launching an e-rupee in part because the trajectory of global money demands it.

The Good News in India's Bleak Budget
Mihir Sharma (Bloomberg Opinion) Feb 2, 2022
As a statement of accounts, it makes for grim reading. But a strong emphasis on green growth may offer the country the economic narrative it's been lacking.

ECB's Lagarde Needs To Chose Her Words Carefully
Marcus Ashworth (Bloomberg Opinion) Feb 2, 2022
It's a delicate time and she needs to push back on rate-hike expectations while not dispelling them completely.

Rise in Inventories Sounds an Alarm About Inflation
Richard Cookson (Bloomberg Opinion) Feb 2, 2022
The move doesn't signal waning demand. It shows how entrenched higher prices have already become.

Kicking Russia Out of Swift Payment System Could Backfire
Leonid Bershidsky (Bloomberg Opinion) Feb 2, 2022
The Society for Worldwide Interbank Financial Telecommunication is vulnerable to the kind of disruption that sanctions could accelerate.

China's Economy Is Heading Toward Stagnation, Not Collapse
Diana Choyleva (FP) Feb 2, 2022
Xi's ideology is knocking out the twin pillars of growth.

Why US workers will return to the labour market
Megan Greene (FT) Feb 3, 2022
The Fed should take care how much and how quickly it raises interest rates in the post-Covid economy.

Fed faces choices as challenging as any since the 1970s
Bob Prince (FT) Feb 3, 2022
Too much delay in monetary policy tightening risks a much bigger response as the central bank catches up with inflation.

Covid entrepreneurs can lead a new wave of creative destruction
John Thornhill (FT) Feb 3, 2022
The pandemic has torn down unnecessary work infrastructure, enabling an explosion of business formation.

The true and fair economic outlook is pretty grim
Chris Giles (FT) Feb 3, 2022
A clear-sighted view shows an internationally mediocre UK recovery with a significant deterioration in prospect.

Sarah Raskin's Systemic Risk at the Federal Reserve
WSJ View Feb 3, 2022
Her desire for politicized credit allocation would damage the economy and the central bank.

US temporizing trade terms with China
Urban C. Lehner (AT) Feb 3, 2022
In the two years since the signing of the so-called phase-one trade agreement, China's purchases of American ag products have soared. The increase drove agriculture-commodity prices higher and swelled American farmers' profits. Ag purchases have, however, fell short of the level set in the phase-one pact and it is unclear what the Biden administration intends to do about it.

Pandemic Scars May be Twice as Deep for Students in Developing Countries
Ruchir Agarwal (IMF) Feb 3, 2022
The duration of disrupted classroom time for those from ages 5 to 19, who make up about a quarter of the world's population. Today, more than two years into the crisis, schools remain closed for millions worldwide—with many more shuttered again by the highly transmissible Omicron.

Countries in the IMF Financial Stability Spotlight in 2022
IMF Feb 3, 2022
This year's assessments address seven economies with systemically important financial sectors: Germany, United Kingdom, Mexico, Russia, Turkey and Ireland, which are reviewed every five years, and South Africa, which is assessed once every 10 years. The others, which requested the assessments themselves, are Colombia, Uruguay and the West African Economic and Monetary Union.

The Bank of England Wakes Up Hawkishly to Inflation Risks
Marcus Ashworth (Bloomberg Opinion) Feb 3, 2022
The central bank's monetary policy committee is taking aggressive action to slay the inflation beast at last.

Building a state one step at a time
Cédric Chambru, Emeric Henry, and Benjamin Marx (VoxEU) Feb 3, 2022
Effective states can raise taxes and armies, enforce laws, and produce public goods, but how these functions are built over time is not well understood. This column studies the administrative reform initiated by the French Revolution, one of history's most ambitious state-building experiments, to shed light on the sequence of steps needed to build effective states. Cities chosen as local administrative centres initially invested in the state's capacity to extract resources from citizens. These cities may not have grown in the short run, but the investments eventually delivered payoffs in terms of public goods, which stimulated long-run growth.

Discovering the 'true' Schumpeter: New insights on the finance and growth nexus
Peter Bofinger, Lisa Geißendörfer, Thomas Haas, and Fabian Mayer (VoxEU) Feb 3, 2022
Joseph Schumpeter made pioneering contributions to economic theory on the relationship between the financial system and economic growth. However, the economic literature has often misinterpreted his work, particularly on the importance of banks and liquidity creation for development. This column argues that a correct interpretation of Schumpeter helps resolve many empirical puzzles which have emerged in the last decades. Using a panel of 43 countries, it finds strong positive effects of credit growth on GDP growth and little effect of saving on GDP and credit growth.

Boom time for trading outside the commodities benchmarks
Mark Keenan (FT) Feb 4, 2022
Non-constituents of main indices such as European natural gas and German power have soared.

Regulators must act to rein in Wall Street risks as rates rise
Sheila Bair (FT) Feb 4, 2022
The Fed needs to reverse course on regulatory easing to ensure financial stability when borrowing costs increase.

Why real inflation is so hard to measure
Tim Harford (FT) Feb 4, 2022
Scientists and bean-counters everywhere need to fill gaps in our knowledge rather than stumble into them.

Latin American leaders target economic prizes during Beijing Winter Olympics
Lucinda Elliott and Gideon Long (FT) Feb 4, 2022
Argentina and Ecuador’s presidents to meet Xi Jinping to discuss debt and investments.

Argentina's IMF deal offers a warning on emerging market debt
Gillian Tett (FT) Feb 4, 2022
With China the largest lender, the old, western-centric approach to restructuring no longer works.

The Wages of Inflation
WSJ View Feb 4, 2022
Average hourly earnings are up 5.7% in a year, and they're rising fast.

Soros vs Dalio in an Olympian debate on China
William Pesek (AT) Feb 4, 2022
George Soros and Southeast Asia are at odds again. This time, though, it's about China. The billionaire that developing nation governments love to hate is making headlines by aiming his megaphone at Xi Jinping's competence. The crux of Soros's argument is that falling prices will "turn many of those who invested the bulk of their savings in real estate against Xi."

America Is Facing a Great Talent Recession
Adrian Wooldridge (Bloomberg Opinion) Feb 4, 2022
If the U.S. is to stand up to a resurgent China, it needs to think as hard about finding top talent as it does about promoting equity.

The Fed's Fight Against Inflation Looks Harder Now
Mark Whitehouse (Bloomberg Opinion) Feb 4, 2022
The strong January employment report suggests the central bank will have to raise rates faster and sooner.

The New Crisis of Central Banking
Mario I. Blejer and Piroska Nagy Mohacsi (Project Syndicate) Feb 4, 2022
For the past few decades, central banks have been at the vanguard of a successful campaign to ward off recessions, even in the aftermath of major crises. But their huge role in propping up markets has had dangerous unintended consequences, that can no longer be ignored.

Supply chain disruptions and mitigation strategies
Raphaël Lafrogne-Joussier, Julien Martin, and Isabelle Mejean (VoxEU) Feb 5, 2022
Global supply chains have been central in economic and policy debates since the start of the Covid-19 pandemic. This column uses the first lockdown in China in 2020 to study how firms involved in global value chains can help mitigate the effects of supply disruptions. Using monthly data on French firms, it finds that inventory management helped firms mitigate the shock, but the geographic diversification of input sourcing did not. Governments may thus consider giving incentives to firms to depart from just-in-time production processes, especially for those engaged in the production of critical products.

China Can't Carry the Russian Economy
Eugene Chausovsky (FP) Feb 4, 2022
Putin's courting of Beijing has paid more diplomatic than economic dividends.

Trigger points loom over equity markets
Philip Coggan (FT) Feb 5, 2022
After declining for 40 years, rising bond yields pose a risk for stocks.

Interest rates may have to rise sharply to fight inflation
Economist Feb 5, 2022
But the low-rate era is unlikely to come to a permanent end.

The global interest bill is about to jump
Economist Feb 5, 2022
The world paid $11trn in interest last year. As rates begin to rise, we calculate who is most exposed to the squeeze.

US trade policy needs a radical redesign
Rana Foroohar (FT) Feb 6, 2022
Chinese strategy makes it unrealistic to return to the 'one world, two systems' vision of the 1990s.

The Fed Should Raise Interest Rates, but Gently
Alan S. Blinder (WSJ) Feb 6, 2022
Tightening is obviously necessary, but getting it right calls for caution, flexibility and humility.

Gasoline Prices Aren't Dropping Anytime Soon
Julian Lee (Bloomberg Opinion) Feb 6, 2022
Demand for oil is likely to be higher and supply lower than forecasts suggest.

The Global Real Yield Tantrum of 2022 Is Here
Lisa Abramowicz (Bloomberg Opinion) Feb 6, 2022
This week we got a glimpse of what was once commonplace: a world where investors in developed markets could actually earn money from bonds. Brace for more shocks ahead.

Jay Powell May Be the Most Important Climate Decision-Maker
David Fickling (Bloomberg Opinion) Feb 6, 2022
The speed of our transition to a carbon neutral world could become collateral damage in the trend toward rate hikes. Central banks should take note.

Fed and ECB still behind the inflation curve
Mohamed El-Erian (FT) Feb 7, 2022
Central banks risk a pile-up of monetary policy tightening as inflation expectations become more embedded.

The Folly of 'Modern Supply-Side' Economics
Phil Gramma and Mike Solon (WSJ) Feb 7, 2022
Janet Yellen tries to sell even more spending as a growth and anti-inflation policy. It's the opposite of what's needed now.

Russia shifting energy flows from West to East
Nikola Mikovic (AT) Feb 7, 2022
A potential large-scale conflict in Ukraine, or even just the persistent threat of one, could result in significant shifts in global energy trade flows. While Russia is strengthening economic and energy ties with China, Europe is simultaneously seeking to reduce its strong dependence on Russian natural gas and oil imports.

The currency of empires
Francesco Sisci (AT) Feb 7, 2022
The American empire is a global order. However, as it applied in the last three decades, using structures conceived 80 years ago, during and after World War II, it should be changed in-depth to keep working. In this, digital money implies a monopoly of power by one or more governments, or a total surrender of power to cryptocurrencies.

Euro Area is Recovering Strongly, But Challenges Lie Ahead
IMF Feb 7, 2022
Economic policies in the euro area have forcefully supported household incomes and protected corporate balance sheets. High levels of vaccination and increasing adaptation to the pandemic have also helped to foster a strong economic recovery. The challenge now is to coordinate the normalization of economic policy in the face of elevated uncertainty, including the evolution and legacies of the pandemic, as well as ongoing geopolitical tensions. Agility will be key, as policies become increasingly targeted to contain scarring and mitigate a potential rise in inequality and poverty.

The Digital Rupee Needs More Thought, Less Haste
Andy Mukherjee (Bloomberg Opinion) Feb 7, 2022
There are many benefits to an Indian CBDC. But is this rush just an attempt to get ahead of China?

Why So Negative? Interest Rates Bid Goodbye to the Insanity
Marcus Ashworth (Bloomberg Opinion) Feb 7, 2022
Cheap money doesn't guarantee solid financial futures. Rejoice that the ECB and perhaps the BOJ will soon be on the other side of zero.

Every Picture Is Telling a Story of Markets Regime Change
John Authers (Bloomberg Opinion) Feb 7, 2022
A turning point is a process and while we're in it, elevated volatility will create great opportunities for traders.

Investing in Africa's Digital Transformation
Sundar Pichai (Project Syndicate) Feb 7, 2022
With its young, enthusiastic, entrepreneurial population, the continent has the potential to reap far-reaching rewards through digitization and adoption of new technologies. But additional, well-targeted investments will be needed to support African innovation and bring more Africans online.

The Price of Modi's Economic Incompetence
Shashi Tharoor (Project Syndicate) Feb 7, 2022
Unless the Indian economy returns to growth rates of 9% or more, the country risks creating a mass of young, poorly educated, unemployed, and angry people – the classic formula for social and political unrest. If the government's economic incompetence continues, hopes of a demographic dividend may turn into a nightmare.

A Balanced Response to Inflation
Joseph E. Stiglitz (Project Syndicate) Feb 7, 2022
Although it is anyone's guess what will happen next with inflation, the data show that there is no reason to react rashly with large across-the-board interest-rate hikes. The economy is working through an unprecedented transition that could ultimately be a boon for workers; but only if policymakers let the process play out.

IMF surcharges: A lose-lose policy for global recovery
Joseph Stiglitz and Kevin P. Gallagher (VoxEU) Feb 7, 2022
The IMF has imposed significant surcharges on countries that have had to undertake large borrowings and are unable to pay their debts back quickly. This column argues that these surcharges are pro-cyclical financial penalties imposed on countries precisely at a time when they can least afford them. They worsen potential outcomes for both the borrowing country and its investors, with gains accruing to the IMF at the expense of both. This transfer of resources to the IMF affects not just the level of poverty, health, education, and overall wellbeing in the country in crisis, but also its potential growth.

Oaktree's China deal is a positive sign for investors
FT View Feb 8, 2022
Seizure of Evergrande asset suggests foreign capital can still have a role.

The message from rising real rates
Robert Armstrong (FT) Feb 8, 2022
And why crypto isn't just another meme.

Euro bond markets risk getting carried away
FT View Feb 8, 2022
The ECB's rising worries about inflation may not yet amount to a hawkish pivot.

Economic sorrows come in battalions
Martin Wolf (FT) Feb 8, 2022
High inflation, rising energy cost and a weakening economy are now with us, and the impending tax rise will make it worse.

US can't decouple from China without China's help
David P. Goldman (AT) Feb 8, 2022
Decoupling the US economy from China sounds like a good idea to Americans who blame the Asian giant for the massive loss of US factory jobs during the past 20 years. The trouble is that the US imports most of its capital goods, so it would have to import more capital goods for years—including from China—in order to reduce its dependence on China in the long term.

China bought none of the extra $200 billion of US exports in Trump's trade deal
Chad P. Bown (PIIE) Feb 8, 2022
Two years ago, President Donald Trump signed what he called a "historical trade deal" with China that committed China to purchase $200 billion of additional US exports before December 31, 2021. Today the only undisputed "historical" aspect of that agreement is its failure. One lesson is not to make deals that cannot be fulfilled when unforeseen events inevitably occur—in this case, a pandemic and a recession. Another is not to forget the complementary policies needed to give an agreement a chance to succeed.

Are Corporate Profits the Key to Weathering a Stock Slide?
Nir Kaissar (Bloomberg Opinion) Feb 8, 2022
The data from bear markets suggests that companies' ability to make money protects investors in turbulent markets.

Bond Market Tantrum Should Give ECB Moment of Pause
Mark Gilbert (Bloomberg Opinion) Feb 8, 2022
Rising yields threaten to tighten monetary conditions before the euro-zone economy is able to cope with higher borrowing costs

Populism May Be Losing Its Influence Over Markets
Aaron Brown (Bloomberg Opinion) Feb 8, 2022
Data suggest that the world economy is headed into a more prosperous, peaceful, egalitarian and cohesive environment over the next decade.

America's Frackers Are Back, and They're Looking Leaner
David Fickling (Bloomberg Opinion) Feb 8, 2022
As the shale industry matures, it has sharpened its ability to reduce costs and increase productivity. OPEC+ should be worried.

Outlaw Cryptocurrencies Now
Willem H. Buiter (Project Syndicate) Feb 8, 2022
In addition to undergoing wild price swings on a regular basis, Bitcoin and other cryptocurrencies are also consuming massive amounts of energy, enabling criminal activity, and creating new financial risks. Their booming yet unfathomable popularity demands an urgent regulatory response.

China's Big Picture
Jim O'Neill (Project Syndicate) Feb 8, 2022
Over the past three decades, China's economy has grown massively and consistently, because its policymakers have proven capable of managing a wide variety of global and domestic challenges. But the government is increasingly becoming the source of headwinds, and the country's outlook is growing cloudier.

Anchoring inflation expectations in emerging and developing economies
Jongrim Ha, M. Ayhan Kose, Hideaki Matsuoka, Ugo Panizza, and Dana Vorisek (VoxEU) Feb 8, 2022
In 2021, inflation in emerging market and developing economies reached its highest level since 2011, prompting many to increase their policy rates. This column argues that these economies need to employ credible, carefully calibrated, and well communicated monetary policies to contain inflationary pressures. Such policies tend to be more successful in anchoring inflation expectations in the presence of an inflation-targeting regime, high central bank transparency, and lower levels of debt.

Why many firms get a bad deal when hedging currency risk
Harald Hau, Peter Hoffmann, Sam Langfield, and Yannick Timmer (VoxEU) Feb 8, 2022
Corporate foreign exchange risk hedging mostly occurs through forward rate contracts with a dealer bank in over-the-counter markets. Unlike in a centralised market, prices are negotiated bilaterally, which gives rise to a large dispersion of transaction prices. It is often difficult for less sophisticated market participants to gauge the quote and execution quality due to the absence of relevant benchmarks, especially in real-time. This column uses new regulatory data to reveal how often firms get a bad deal and what they can do to avoid it.

Part III: Central Bank Digital Currencies
Jay H. Bryson and Karl Vesely (WF Econ Group) Feb 8, 2022
In this third installment in our four-part series on digital currencies, we discuss efforts by central banks to develop their own digital currencies, which are known as CBDCs.

European Central Bank Starts Heading More Hawkish
Nick Bennenbroek, Brendan McKenna, and Jessica Guo (WF Econ Group) Feb 8, 2022
Eurozone economic growth softened around the turn of the year, and although consumer fundamentals should support continued expansion, GDP growth should be slower in 2022 than in 2021. In contrast, CPI inflation remains elevated, with January's 5.1% year-over-year increase the largest on record. While much of the increase has been driven by energy, price pressures are becoming more broad-based, and neither headline nor core inflation have likely peaked. These persistent price pressures have attracted the attention of European Central Bank (ECB) policymakers, who delivered a hawkish monetary policy announcement in early February. ECB President Lagarde said inflation risks were tilted to the upside, and did not take the opportunity to repeat that a 2022 rate hike is very unlikely. The ECB appears to be laying the groundwork for an eventual rate increase, which we think the central bank will build further at its March meeting by announcing a faster tapering of bond purchases. In March, we expect the ECB to signal €40B per month of bond purchases during Q2-2022, €20B per month of purchases during Q3-2022, and to say it intends to end bond purchases in September. Beyond March, we expect the ECB to start raising its Deposit Rate shortly after it completes its net bond purchases. Specifically, we see an initial 25 bps Deposit Rate hike in December 2022 and another 25 bps hike in March 2023. Beyond that, we see ongoing, but slower hikes, with 10 bps increases expected in June 2023, September 2023 and December 2023.

Markets lose trust in central banks
John Redwood (FT) Feb 9, 2022
Western countries were too slow in taking action to control inflation.

Crypto accounting: investors need more clarity on the rules
Francine McKenna (FT) Feb 9, 2022
Companies should have stronger guidance on how to present the changing value of their digital asset holdings.

Emerging markets signal end to aggressive rate-raising cycles
Jonathan Wheatley (FT) Feb 9, 2022
Brazil, Russia and others jumped ahead of the Fed to control inflation but may have stifled growth.

How could sanctions against Russia hit European economies?
Valentina Romei, Martin Arnold, and Nastassia Astrasheuskaya (FT) Feb 9, 2022
Europe’s energy, trade, manufacturing, banking and markets may be affected if Moscow invades Ukraine.

Decarbonizing Steel: How the Demand for Greener Steel Will Upend the Supply Chain
Nils Naujok, Holger Stamm, and Markus Knopf (BRINK) Feb 9, 2022
The decarbonization of steel — a basic building block of the global economy — will require the reinvention of not only how steel is made, but essentially a reimagining of the entire steel supply chain.

The Growing Pile of Public Debt Shows that Inflation Is Here to Stay
Mihai Macovei (Mises Wire) Feb 9, 2022
One obstacle to weeding out inflation is the large stock of public debt, which is growing even in countries once known for relative fiscal frugality. This suggests interest rates must be kept low indefinitely.

How Should Investors Value Gold?
Urban Jermann (K@W) Feb 9, 2022
Investors of all kinds have always been lured by the king of metals, and even the most hardnosed of them know it holds extra value for those who adorn themselves with it. A new approach to capture that extra value in gold jewelry, allowing investors a better way to price gold.

Have Bond Investors Gone Completely Insane?
Robert Burgess (Bloomberg Opinion) Feb 9, 2022
The debt market continues to slide, yet traders are clamoring for Treasuries. What gives?

In Japan, All that Glitter Can Be Cryptocurrency
Andy Mukherjee (Bloomberg Opinion) Feb 9, 2022
But Mitsui's gold coin isn't the one to watch. Why do you need an inflation hedge in a deflation-prone country?

The Housing Party Is Starting to Wind Down
Gary Shilling (Bloomberg Opinion) Feb 9, 2022
Builders are ramping up supply just as a record low percentage of Americans say it's a good time to buy a home.

Markets Are Right to Test the BOJ
Daniel Moss (Bloomberg Opinion) Feb 9, 2022
Kuroda may have said that rate hikes are "unthinkable," but that still leaves a lot of possibilities on the table.

Reviving Appropriate Technology
Dani Rodrik (Project Syndicate) Feb 9, 2022
Manufacturing technologies have become increasingly skill-intensive, and automation and other forms of innovation have reduced labor's share of manufacturing value added. Reorienting global innovation in a more labor-friendly direction would benefit developing countries and advanced economies alike.

The Anatomy of Technology Regulation
Nicholas Davis , Mark Esposito, and Landry Signé (Project Syndicate) Feb 9, 2022
With the United States, the European Union, and China each adopting its own characteristic approach to technology regulation, it is tempting to conclude that ideology is driving them. But anyone hoping to divine where tech policies are heading will need to focus on more granular and mundane factors at the national level.

Make Capitalism Competitive Again
Ruben Maximiano (Project Syndicate) Feb 9, 2022
President Joe Biden's recent decision to take on the entrenched oligopoly in the US meatpacking inudstry highlights the boldness of his antitrust agenda. His administration's message is clear: market capitalism functions properly only when there is healthy competition.

Intergenerational transfers and wealth inequality
Juan C. Palomino, Gustavo A. Marrero, Brian Nolan, and Juan Gabriel Rodríguez (VoxEU) Feb 9, 2022
Wealth inequality can limit people's ability to accumulate human capital, carry out business projects, or cope with major economic crises. Focusing on France, Spain, the UK, and the US, this column shows that intergenerational transfers, such as inheritances and inter vivos gifts, play a significant role in underpinning wealth inequality. When inheritancesand gifts exceed a certain threshold, the opportunities to accumulate more wealth are greatly expanded.

Supranational cooperation and regulatory arbitrage
Thorsten Beck, Consuelo Silva-Buston, and Wolf Wagner (VoxEU) Feb 9, 2022
Large cross-border banking groups dominate the global banking landscape. This column shows that supervisory cooperation can result in regulatory arbitrage by these global banking groups, shifting risky activities into third-country subsidiaries not covered by cooperation. The findings suggest that supervisory cooperation agreements can have negative externalities on third countries, undermining their overall effectiveness and pointing to a need to 'cooperate on cooperation'.

Debt: The eye of the storm
Laurence Boone, Joachim Fels, Òscar Jordà, Moritz Schularick, and Alan M. Taylor (VoxEU) Feb 9, 2022
The Covid-19 pandemic will go down as one of the most severe human, economic, and financial events in the history of the modern world. Nations have accumulated public debt levels not seen since WWII in their efforts to tackle the health crisis and mitigate the ensuing economic dislocation. The private sector has also experienced a run-up in debt, but unlike the Great Mortgaging of the 2000s, this time led by the corporate sector. The 24th Geneva Report on the World Economy explores the geo-economic risks entailed by these historic levels of overall debt and concludes that while debt should not be ignored, neither should it be feared.

Why countries should restructure debts sooner rather than later
Simon Hinrichsen (FT) Feb 10, 2022
Delays lead to harder knock-on effects from a restructuring of borrowings.

Inflation Haunts the Biden Economy
WSJ View Feb 10, 2022
An historic policy failure calls for a sharp turn at the Fed and White House.

Debt-ridden Pakistan begs China for a bailout
FM Shakil (AT) Feb 10, 2022
Pakistan's Prime Minister Imran Khan has asked China for a US$9 billion bailout package comprised of financial support and the rollover of existing debts to prevent a possible default on external payments worth $8.6 billion that come due at the end of June. Chinese leadership "took note" of the request but it's not yet clear whether Beijing will oblige.

Who's to blame for 'phase one' trade deal failure?
Jeff Pao (AT) Feb 10, 2022
China fulfilled just 57% of its full two-year purchase quotas in the "phase one" trade deal signed between the Trump administration and Chinese authorities in January 2020. US officials quoted in media reports said that Washington was losing patience with Beijing, which they claimed had shown no signs of meeting the trade deal's purchase agreements.

Price Hikes in Retail Goods Spur U.S. Inflation – and the Fed Is Watching
Tiffany Wilding (PIMCO) Feb 10, 2022
U.S. inflation outpaced consensus estimates for January, likely complicating the policy path for the central bank.

Despite Inflation Surge, the Fed Should Keep Steady
Bloomberg View Feb 10, 2022
The central bank's gradual and patient approach remains on target, even as a wage-price spiral looms large.

The Bond Market Can Finally Do Its Job Again
Marcus Ashworth (Bloomberg Opinion) Feb 10, 2022
Its behavior is supposed to warn about inflation but the function was smothered by a decade of QE bond buying

A Renewable Energy Bubble Is Hit By the Perfect Storm
Chris Bryant (Bloomberg Opinion) Feb 10, 2022
The wind industry still looks like a long-term winner, but it's more vulnerable to supply-chain issues than investors appreciated.

The Market Is Finally Putting a Realistic Price on Carbon
David Fickling (Bloomberg Opinion) Feb 10, 2022
This surge should be seen as a success. Politicians need to resist the populist impulse to intervene and drag down prices.

What Would Modern Monetary Theory Do About Inflation?
Clive Crook (Bloomberg Opinion) Feb 10, 2022
MMT correctly acknowledges the problem of rising prices, but it offers no plausible solution.

China's Triangulation Gambit
Stephen S. Roach (Project Syndicate) Feb 10, 2022
America's rapprochement with China, 50 years ago this month, isolated the former Soviet Union at a time when its economic foundation was starting to crumble. Today, there can be little doubt that China has revived triangulation as a strategic gambit – or that this time America is the one being triangulated.

America's Not-So-Great Inflation
Barry Eichengreen (Project Syndicate) Feb 10, 2022
The acceleration of US inflation in recent months has led many alarmed observers to point to parallels with the 1970s, when commodity prices shot up, the US Federal Reserve fell behind the curve, and inflation expectations became unmoored. In fact, today's circumstances could not be more different.

Surging inflation in the UK
Ethan Ilzetzki (VoxEU) Feb 10, 2022
Consumer prices in the UK rose by 5.4% (year-on-year) in December 2021, the highest annual rate of inflation since the UK adopted an inflation target in 1992. The January CfM survey asked a panel of experts on the UK economy to evaluate the causes and prospects of the current inflation surge. The panel was nearly unanimous in thinking it was caused by supply side factors that are mostly global in nature (commodity prices, supply chain disruptions) and fall outside government control.

How Might Emerging FX Perform in a 2022 Taper Tantrum?
Brendan McKenna (WF Econ Group) Feb 10, 2022
Central banks around the world have become more concerned around the faster pace of inflation. The Bank of England and European Central Bank recently turned more hawkish to address inflationary pressures, while the Fed has dramatically shifted course on its outlook for monetary policy. With U.S. CPI hitting a new high since the 1980s, it's possible the Fed could tighten monetary policy more aggressively than financial markets expect. While this is not our base case view at the moment, a 2022 version of the "Taper Tantrum" could be brewing and emerging market currencies could come under more pressure than we expect. In this report, we discuss central bank responses to inflationary pressures and use our emerging market FX vulnerability framework to identify currencies most at risk, as well as emerging currencies that could be more insulated from a Fed monetary policy surprise. In addition, we examine how emerging market currencies have evolved since the 2013 Taper Tantrum.

Brexit opportunities, not opportunism, are needed
FT View Feb 11, 2022
The UK's future regulatory design depends on detail, not performative debate.

Economics should never waste a good crisis
FT View Feb 11, 2022
The dismal science learns the most on those occasions when things go very wrong.

Why Turkey's economic resilience has defied worst fears
Francesc Balcells (FT) Feb 11, 2022
Country has avoided the implosion some predicted with every round of currency depreciation.

Beware the algorithms driving up oil prices
Gillian Tett (FT) Feb 11, 2022
Automated trading by investors can lead to 'robo-herding' in markets.

People Hate Inflation. But We Need to Keep Higher Prices in Perspective.
Peter Coy (NYT) Feb 11, 2022
It's important to keep the damage from high prices in perspective.

Inflation May Have Already Peaked. The Fed Needs to Step Gingerly.
Jeff Sommer (NYT) Feb 11, 2022
Part of the surge in prices stems from the pandemic's effects and the money poured into the economy to ease that harm.

Worse to come from worst US inflation in 40 years
David P. Goldman (AT) Feb 11, 2022
US stocks took a nasty turn downward after the Bureau of Labor Statistics announced a higher-than-expected 7.5% jump in consumer prices over the last 12 months, the worst inflation in forty years. The likelihood is that inflation will continue to raise at painfully high levels for the next year. That leaves the Federal Reserve in a pickle.

Bond Traders Haven't Hit Their Pain Threshold  Yet
Mark Gilbert (Bloomberg Opinion) Feb 11, 2022
Fixed-income returns aren't likely to improve any time soon. Borrowers should accelerate their issuance plans.

The Fed Should Pick 'Boomflation' Over a Recession
Conor Sen (Bloomberg Opinion) Feb 11, 2022
Letting inflation run hotter than planned is a better outcome than crushing economic growth with overly severe interest rate increases.

The Return of Global Inflation
Carmen M. Reinhart (Project Syndicate) Feb 11, 2022
Today's inflationary surge is being felt not just by the advanced economies but also by the majority of emerging markets and developing economies. And though its causes vary across countries, the task of resolving the problem ultimately will fall to the world's major central banks.

The New Land Economy
Giulio Boccaletti (Project Syndicate) Feb 11, 2022
While it is well known that reducing global carbon emissions to net-zero will require widespread economic change, far too little attention has been paid to the issue of land use. The green transition will require a fundamental reconsideration of how we apportion rights to the planet's surface.

The impact of monetary policy on income and wealth inequality
Petri Mäki-Fränti, Aino Silvo, Adam Gulan, and Juha Kilponen (VoxEU) Feb 11, 2022
New monetary policy instruments introduced by the ECB following the 2008-2013 financial and debt crisis have raised concerns that central banks' securities purchase programmes disproportionately benefited wealthy households. Using Finnish data, this column finds that while the impact on economic growth has been significant, on average the changes in income and wealth disparities have been small. Nevertheless, the results suggest the precise channels through which monetary policy affects inequality may differ across countries.

Note to the Federal Reserve: Don't Panic About Inflation
John Cassidy (New Yorker) Feb 11, 2022
Jerome Powell and his colleagues have the capacity, if they overreact, to crash the housing market, the stock market, and the economy.

Stablecoin firms should be regulated like the banks they are
Brendan Greeley (FT) Feb 12, 2022
Holders of the digital assets should have similar protections to depositors.

Markets on edge over central bank action to tame inflation
Katie Martin (FT) Feb 12, 2022
Monetary policy is data-dependent — and the data are pretty wild.

Are Activist Short Sellers Misunderstood?
Michelle Celarier (NYT) Feb 12, 2022
A government investigation and proposed rules aim to rein in investors who talk down stocks. But some argue abuse by activist short sellers isn't as common as believed.

What would happen if financial markets crashed?
Economist Feb 12, 2022
Look to history for a guide, but know that next time will be different.

ECB policymakers are right to hold their nerve on inflation
Martin Sandbu (FT) Feb 13, 2022
Today's febrile narrative insists on emphasising signs of overheating and ignoring those of spare capacity.

Inflation Is Everywhere
WSJ View Feb 13, 2022
Some 55% of items saw price increases of 5% or higher in January.

The World Has Been Using A Lot More Oil Than We Thought
Julian Lee (Bloomberg Opinion) Feb 13, 2022
Global oil stockpiles are a lot lower than previous estimates suggest.

Will this truly, finally be 'the year of the stockpicker'?
Robin Wigglesworth (FT) Feb 14, 2022
Fund inflows suggest optimism that active fund managers will perform better in 2022.

Slower growth and higher inflation are the hallmarks of a post-Covid world
Ruchir Sharma (FT) Feb 14, 2022
Despite last year's bounceback, the question is how fast economies can grow once pandemic stimulus recedes.

Digital currencies carry threats as well as promises
Eswar Prasad (FT) Feb 14, 2022
The proliferation of new financial technologies calls for better cross-border regulation and supervision.

Federal Reserve officials call for a measured response to inflation.
Jeanna Smialek (NYT) Feb 14, 2022
Central bankers panned the idea that they will raise interest rates between meetings. Nor have they settled on a big rate increase.

Biden's Cost-of-Carbon Inflation
WSJ View Feb 14, 2022
A judge calls out a regulatory ruse to gut cost-benefit analysis.

Median Inflation Gauge Offers Better Read on Price Trends
Laurence Ball, Daniel Leigh, Prachi Mishra and Antonio Spilimbergo (IMF) Feb 14, 2022
Using an alternative measure may help separate the signal from the noise.

Immigration is the key to emerging markets becoming innovation hubs
Dany Bahar, Prithwiraj Choudhury, and Sara Signorelli (Brookings) Feb 14, 2022
In 2019, the World Intellectual Property Organization (WIPO) reported that China alone accounted for almost half of all the world's patent filings, with India also registering impressive increases in global patent production. "Asia has become a global hub for innovation," declared WIPO Director General Francis Gurry.

Hold That Tesla! Inflation Will Be Made of Aluminum
Javier Blas (Bloomberg Opinion) Feb 14, 2022
The metal used to be dirt cheap. No longer. It's going to affect everything from government policy to the price of groceries.

Europe Must Be Africa's Partner of Choice
Josep Borrell (Project Syndicate) Feb 14, 2022
Having committed to pursuing a much closer partnership with African governments and the African Union, the European Union must consider how it can best contribute to Africa's security and economic prospects. With other global powers competing for influence, much more than trade and investment is at stake.

Free the Money We Need
Jayati Ghosh (Project Syndicate) Feb 14, 2022
One major reason for the highly uneven global economic recovery is the huge variation in fiscal responses between rich countries and the rest of the world. An annual issuance of special drawing rights, the International Monetary Fund's reserve asset, could help to bring about a more equitable and climate-friendly rebound.

Intranational trade barriers and firm productivity: Evidence from India
Ama Baafra Abeberese and Mary Chen (VoxDev) Feb 14, 2022
Highway construction in India improved productivity by inducing firms to focus on products in which they are most efficient

The rise of exporters and importers in US job growth
Kyle Handley, Fariha Kamal, and Wei Ouyang (VoxEU) Feb 14, 2022
Assessing the effects of trade participation on domestic job growth is complicated by global supply chains – both exporters and domestic producers rely on imported inputs. This column describes findings from a new US Census Bureau public-use data product combining longitudinal information on firms, workers, and merchandise trade transactions. The statistics reveal the growing importance of exporters and importers for US job growth. A direct implication is that protectionism can dampen US traders' competitiveness and adversely impact overall domestic job growth.

Changing views on trade's impact on inequality in wealthy countries
David Dorn and Peter Levell (VoxEU) Feb 14, 2022
The consensus view until the 2010s was that trade had little impact on inequality in high-income countries. This column reviews the recent evidence that challenges this view. Manufacturing employment contracted sharply in countries like the US and the UK which faced rapid net import growth from China. The resulting, persistent adverse effects on employment and incomes of low-skilled workers do not appear to have been offset by trade's effect on prices, which seems to have benefited rich and poor households alike. Mitigating these effects is an important but difficult task for policymakers.

Will Rising Rents Push Up Future Inflation?
Kevin J. Lansing, Luiz E. Oliveira, and Adam Hale Shapiro (FRBSF Econ Letter) Feb 14, 2022
Rising rents account for a significant portion of recent inflation. Estimates of how rent inflation typically responds to two leading indicators—current asking rents and current house prices—can help forecast the path of overall inflation for the next two years. This method predicts that higher rent inflation could add about 0.5 percentage point to personal consumption expenditures price inflation for both 2022 and 2023. These potential additions are important in light of the Federal Reserve's 2% inflation target.

Does Inequality Provoke Populism?
Paolo Gerbaudo (FP) Feb 14, 2022
A new book argues that economic unfairness is more important than unequal incomes—but only redistributive policies can restore social mobility.

The Covid aftermath requires sovereign debt restructuring
FT View Feb 15, 2022
Better mechanisms are needed to help Sri Lanka, Zambia and others resolve their debts.

When you count users instead of dollars, the NFT world is tiny
Tim Bradshaw (FT) Feb 15, 2022
Why the infancy of non-fungible tokens may last a long time.

Emerging markets: all risk and few rewards?
Jonathan Wheatley (FT) Feb 15, 2022
As inflation spirals and growth rates slow, the case for investing in emerging markets has rarely been weaker.

Trump's Big China Flop and Other Failures
Paul Krugman (NYT) Feb 15, 2022
Oh, what a lousy trade war.

Argentina joins China's Belt and Road Initiative
Scott Foster (AT) Feb 15, 2022
Argentine President Alberto Fernandez added another event to a highly politicized Winter Olympics when he met in Beijing last week with Chinese President Xi Jinping and agreed to join China's Belt and Road Initiative, putting an official seal on what was already an extensive and growing economic relationship.

Quant Momentum Strategy Is Being Maligned Unfairly
Aaron Brown (Bloomberg Opinion) Feb 15, 2022
Over the long run, betting that things will continue as they have in the recent past is like being the casino in roulette: You lose a lot of bets, but you end up winning more than you lose.

Inflation Will Be Exactly What People Expect It to Be
Tyler Cowen (Bloomberg Opinion) Feb 15, 2022
A lot of uncertainty over whether prices will rise or fall can be settled with one question: What do you think?

Good News, Growth Laggards. You're Ahead of the Game
Daniel Moss (Bloomberg Opinion) Feb 15, 2022
Some economists are starting to worry that central bankers will overreact with aggressive rate hikes. Japan's disappointing recovery means that's not an option.

Measuring Poverty Properly
Nurul Izzah Anwar (Project Syndicate) Feb 15, 2022
The gap between rich and poor continues to widen around the world, but governments cannot provide the necessary resources to raise living standards without accurate measures of the scope of the problem. The Multidimensional Poverty Index offers policymakers an essential tool for building an adequate safety net.

Can Africa Unite?
Malado Kaba (Project Syndicate) Feb 15, 2022
As African heads of state and government meet with their European counterparts to discuss how to deepen relations between the two continents, they should heed the lessons of Europe's own past. Forging a united bloc takes time, and it starts with economic integration and strategic capacity-building.

Digital Revolution: Will Cryptocurrencies Take Over the World? Part IV: Conclusions
Jay H. Bryson and Karl Vesely (WF Econ Group) Feb 15, 2022
In this final report in our four-part series on digital currencies, we offer some conclusions from the first three installments.

The looming threat of long financial Covid
Martin Wolf (FT) Feb 16, 2022
Necessary debt restructurings will be prolonged and messy while people and economies suffer.

South Korea’s push for developed nation status may not be the win it hopes
Leo Lewis (FT) Feb 16, 2022
Promotion in MSCI equity index is a key issue in presidential polls — but it has risks as well as attractions.

East-west divergence in central bank action will not last much longer
Alicia Garcia-Herrero (FT) Feb 16, 2022
Fed shift towards raising rates will make it hard for China and Japan not to tighten monetary policy.

It’s time for the Federal Reserve to make a decisive move on inflation
WaPo view Feb 16, 2022
This is not a moment for the Fed to fret about how the public and markets will react.

India's biggest IPO is also a big distraction
William Pesek (AT) Feb 16, 2022
With India's stock market outperforming its peers in Asia, now may seem an ideal moment for Prime Minister Narendra Modi to pull off his government's biggest divestment transaction to date. Yet for many global investors, India's largest initial public offering ever is too little too late. It's also a reminder that the structural reforms New Delhi promised remain more talk than action.

Three Policy Priorities for a Robust Recovery
Kristalina Georgieva (IMF) Feb 16, 2022
We must work together to end the pandemic, navigate monetary tightening and shift focus to fiscal sustainability.

The Japanese Economy Has Reinvented Itself
John West (BRINK) Feb 16, 2022
Japan's economy often gets a bad rap, but Japanese companies have become competitive by concentrating on high-value-added advanced materials that go into Asia's consumer product supply chains, especially electronics.

Getting out of the coronavirus economic contraction
Indermit Gill, M. Ayhan Kose, and Dana Vorisek (Brookings) Feb 16, 2022
By the end of next year, COVID-19's economic sting is likely to be an ugly but fading memory for the world's wealthiest economies: Their GDP levels are forecast to be somewhat higher than pre-pandemic projections indicated they would be by 2023. Not so for most emerging market and developing economies (EMDEs), which will remain debilitated well into this decade. The World Bank's latest Global Economic Prospects report forecasts that by 2023, just one EMDE region—Europe and Central Asia—will come anywhere close to regaining the GDP level that had been expected before the pandemic (Figure 1). In Latin America and the Caribbean, the Middle East and North Africa, and sub-Saharan Africa, the gap with the pre-pandemic projection is expected to be 4 percent or more. South Asia will be the farthest behind, with its GDP level nearly 8 percent below where it might have been but for COVID-19.

Americans Shrug Off Inflation With Some Retail Therapy
Robert Burgess (Bloomberg Opinion) Feb 16, 2022
Rising prices don't appear to be deterring consumers from opening their wallets.

Will All These Rate Hikes Cause a Recession?
Daniel Moss (Bloomberg Opinion) Feb 16, 2022
Policy makers are beginning to worry that raising the cost of borrowing too quickly could have dire consequences.

Argentina's Debt Deal Promises No Salvation
David Wainer (Bloomberg Opinion) Feb 16, 2022
The flaws in the planned 22nd agreement with the International Monetary Fund make it all too likely that the country may default again this decade.

Bond Funds Lurk as a Challenge to Fed's Inflation Fight
Eric Balchunas (Bloomberg Opinion) Feb 16, 2022
If outflows continue, they could accelerate and ultimately lead to redemption halts and subsequent panic by retail investors.

An Argentinian Haircut for the IMF
Willem H. Buiter (Project Syndicate) Feb 16, 2022
By approving an unprecedentedly large loan to Argentina in mid-2018, despite the country's failure to meet basic borrowing conditions, the International Monetary Fund committed a major blunder. Rather than compounding the mistake with another similar program, it should accept reality – and responsibility.

Bury the US-China Trade Agreement
Chang-Tai Hsieh (Project Syndicate) Feb 16, 2022
China's failure to purchase enough US exports under the flawed "phase one" trade deal is cause for celebration. The only way the pact could have been fully implemented was if China used the same opaque, non-market tools that have long bedeviled American firms trying to do business there.

The Fight Against Inflation Is Becoming a Class War
Leah Downey (FP) Feb 16, 2022
Central banks have decided that heads, the rich win—tails, the poor lose.

Pressure Check: Past the Turning Point but a Long Way from Victory
Tim Quinlan, Sarah House, Shannon Seery, and Sara Cotsakis (WF Econ Group) Feb 16, 2022
This report checks the Pressure Gauge, our tool for keeping tabs on where things stand with supply chains, and discusses some recent fine-tuning of our tool. The fever may be starting to break, particularly as goods demand has cooled and allowed for some domestic shipping measures to catch up, but a tight labor market and sustained back-up at ports tell us that we have a long way to go before we can point to a definitive improvement.

The EU's new tools to defend the rule of law
FT View Feb 17, 2022
Ruling allows Brussels to suspend funds for Hungary and Poland.

Central banks face a set of hard choices
FT View Feb 17, 2022
Any trade-off between inflation and growth is at heart of monetary policy.

Are the US GDP data missing a capital spending boom?
Matthew C Klein (FT) Feb 17, 2022
There is a disconnect between the size of the trade deficit and the apparent weakness of corporate investment.

Inflation bites: what it would take for Japan to get a national pay rise
Antoni Slodkowski, Eri Sugiuram and Leo Lewis (FT) Feb 17, 2022
With the prime minister’s support, can Japan’s unions convince employers to raise wages after 30 stagnant years?

Malaysian economy grows, but pandemic risks remain
Nile Bowie (AT) Feb 17, 2022
Malaysia’s economy is firmly in recovery territory with full-year growth for 2021 having expanded within the official forecast range at 3.1% after a rebound in the final quarter of last year. But Southeast Asia’s third-largest economy isn’t out of the woods as inflationary headwinds threaten to stymie growth-spurring private consumption.

RMB tail wags US inflation dog
David P. Goldman (AT) Feb 17, 2022
Remarkably, the best predictor of US inflation expectations during the past three years is the RMB’s exchange rate against the US dollar. That’s because the marginal item bought by an American consumer with the $6 trillion of pandemic stimulus handouts is likely to be imported, and likely to be imported from China.

Supply Disruptions Add to Inflation, Undermine Recovery in Europe
Kristalina Georgieva, Oya Celasun and Alfred Kammer (IMF) Feb 17, 2022
With supply constraints likely to persist, the challenge for policymakers is to support recovery without allowing high inflation to become entrenched.

Why Central Banks Are Getting Inflation So Wrong
Javier Blas and Marcus Ashworth (Bloomberg Opinion) Feb 17, 2022
Monetary policy makers have hamstrung their own efforts by misjudging commodity markets.

U.S. Treasury's Golden Fed Goose Is About to Get Cooked
William C Dudley (Bloomberg Opinion) Feb 17, 2022
Quantitative easing generated ample income for the government. That’s about to change.

Hong Kong’s Brain Drain Is Causing Real Pain
Matthew Brooker (Bloomberg Opinion) Feb 17, 2022
The market watchdog has lost 25% of junior professional staff over the past year. It’s a warning sign for the territory’s future as a financial center.

Biden's Misery Index
Michael J. Boskin (Project Syndicate) Feb 17, 2022
Historically, the Misery Index – the sum of the unemployment and inflation rates – has offered a sound benchmark for assessing an incumbent party's electoral prospects. While it isn't perfect, recent polling also suggests that the US Democrats have little reason for optimism about November's midterm congressional elections.

How to Make the Pandemic History
Ban Ki-moon (Project Syndicate) Feb 17, 2022
As the COVID-19 pandemic enters its third year, millions of people around the world remain in the grip of fear and uncertainty, owing to our collective failure to achieve universal vaccination. Still, three upcoming events offer world leaders a chance to begin to remove this moral stain.

How PR Firms Captured the Sustainability Agenda
Melissa Aronczyk (FP) Feb 17, 2022
More than just “spin artists,” consultancies have promoted economic growth and environmental protection as mutually reinforcing.

Forces driving semiconductor boom are far from over
Kathrin Hille (FT) Feb 18, 2022
Long-term trends raise industry hopes of defying past cycles of building too much capacity as demand weakens.

Regulators have cryptocurrencies in their sights
Gillian Tett (FT) Feb 18, 2022
As digital assets go mainstream, investors should take heed of the dangers they bring.

Wonking Out: What to Expect When You’re Expecting Inflation
Paul Krugman (NYT) Feb 18, 2022
Some surprising good news from consumer surveys.

March 2020: How the Fed Averted Economic Disaster
Nick Timiraos (WSJ) Feb 18, 2022
As markets plunged, Jerome Powell and his colleagues vastly expanded the reach of the central bank, with implications that will be felt for years to come.

How Government Spending Fuels Inflation
Tunku Varadarajan (WSJ) Feb 18, 2022
When debt grows so much that people don’t believe the Treasury will pay it, they sell their bonds and buy other things, sending prices through the roof.

China’s currency scores a win during the Olympics
William Pesek (AT) Feb 18, 2022
The People’s Bank of China is making its own history at the Olympics: first out of the gate with a digital currency. Yet this week also sees the PBOC making history in another respect: the yuan’s fast-increasing role in the global payments race and the currency’s increasing popularity, in other words, is pushing demand for Beijing’s IOUs to record highs.

Stepping Up With and For Africa
Kristalina Georgieva (IMF) Feb 18, 2022
As the world emerges from an unprecedented crisis, all countries are struggling with challenges–but it is particularly true for Africa. Africa experienced a painful contraction in 2020. Since then, it has started growing again—but for many countries growth falls short of what is needed.

The 2% Inflation Target Should Be Consigned to History
Marcus Ashworth (Bloomberg Opinion) Feb 18, 2022
Policy makers need a new compass to navigate the post-QE, post-Covid world.

Beware the Invisible Losses Inflation Foists on Investors
Richard Cookson (Bloomberg Opinion) Feb 18, 2022
It’s more important than ever to understand the difference between nominal and real returns. Unfortunately, too many don’t.

The Fed Is Not the Right Place to Fight Climate Change
Karl W Smith (Bloomberg Opinion) Feb 18, 2022
Sarah Bloom Raskin’s ideas about how to combat global warming would threaten the central bank’s independence.

Understanding China Since Nixon
Shang-Jin Wei (Project Syndicate) Feb 18, 2022
US policymakers may be tempted, for geopolitical reasons, to reverse the policy of economic engagement with China pursued by successive administrations in the decades following President Richard Nixon’s historic 1972 visit. But such a step would carry significant risks.

America and China's Unhappy Anniversary
Richard Haass (Project Syndicate) Feb 18, 2022
Fifty years ago, the United States responded to the Sino-Soviet split with a foreign policy that was creative in both design and execution. Given the current poor state of Sino-American relations, the best way to mark the anniversary is by crafting an equally imaginative approach to reviving bilateral cooperation.

Growth and the Migration Factor
Brigitte Granville (Project Syndicate) Feb 18, 2022
Wars and natural disasters have always forced people to cross political borders to seek safety and a better life. But whether they are well-received when they reach their destination depends on a confluence of political, social, economic, and geographic factors.

Growth expected to regain traction after winter slowdown: The Commission's Winter 2022 Forecast
Maarten Verwey, João Leal, and Przemyslaw Wozniak (VoxEU) Feb 18, 2022
Intensified headwinds softened the EU’s growth momentum around the turn of the year. The European Commission’s Winter 2022 Forecast expects that as these headwinds gradually fade, the expansion of the European economy will regain pace in the second quarter and remain robust until 2023. Following a strong rebound in 2021, growth in the EU is now forecast at 4.0% in 2022 (down from 4.3% in the Autumn Forecast) and 2.8% in 2023. The euro area inflation forecast for 2022 is revised up on the expectation that energy prices will stay high for longer. Inflation is expected to return to just below 2% in 2023.

‘The juncture’ looms for investors
John Dizard (FT) Feb 19, 2022
The likely cost of suppressing inflation is a reduction in Fed balance sheet accompanied by recession.

Labour v capital in the post-lockdown economy
Economist Feb 19, 2022
As prices and wages rise, are workers or firms winning?

The European Central Bank Is Trapped Like the Fed
André Marques (Mises Wire)_ Feb 19, 2022
Like America's central bank, the European Central Bank can't let interest rates rise without facing some big negative repercussions.

China’s Challenge to the U.S. Is So Much More Than Cold War 2
Toby Harshaw (Bloomberg Opinion) Feb 19, 2022
Beijing wants the world to embrace its authoritarian model. But the country is also part of a highly integrated global economy. A Q&A with Elizabeth Economy.

Fishing for Brexit opportunities will end with an unsatisfactory haul
Martin Wolf (FT) Feb 20, 2022
The promised regulatory divergence from the EU is far from an easy win.

Singapore Won’t Displace Hong Kong as a Financial Center
Rachel Rosenthal (Bloomberg Opinion) Feb 20, 2022
The cities work better as complements, rather than competitors for global talent.

The Federal Reserve Is Veering Toward a Hard Landing
Lisa Abramowicz (Bloomberg Opinion) Feb 20, 2022
The recent disruption in financial markets may be just getting started, inflicting damage on the broader economy.

Crypto’s rise requires a global response
FT View Feb 21, 2022
G20 ministers are right to take proactive approach to crypto risks.

There is more to market volatility than Ukraine
Mohamed El-Erian (FT) Feb 21, 2022
Investors need strong stomachs to deal with large swings in asset prices.

It’s not just the economy, stupid
Rana Foroohar (FT) Feb 21, 2022
Politics will play a bigger role in a world where regionalisation, not globalisation, is the future.

In charts: can Erdogan’s gamble keep the Turkish lira steady?
Laura Pitel (FT) Feb 21, 2022
President is backing unorthodox measures to stabilise the currency but analysts are sceptical.

What’s at Stake for the Global Economy as Conflict Looms in Ukraine
Patricia Cohen and Jack Ewing (NYT) Feb 21, 2022
Countries that depend on the region’s rich supply of energy, wheat, nickel and other staples could feel the pain of price spikes.

The Inflation Mess and a Financial Refuge
Joshua Rauh and Kevin Warsh (WSJ) Feb 21, 2022
Biden and the Fed need a sharp policy change, and meantime Treasury can raise the cap on I-bonds.

Xi’s relentless tech squeeze crimping growth hopes
William Pesek (AT) Feb 21, 2022
On January 16, People’s Bank of China (PBOC) Governor Yi Gang voiced optimism that Asia’s biggest economy can return to business as usual in 2022. Yet two days later, his boss – Xi Jinping – reminded Yi how hard that might be when a raft of new regulations on food-delivery platforms triggered a brutal US$1.5 trillion sell-off in tech stocks.

Will Inflation Turn into Stagflation?
Peter St. Onge (Mises Wire) Feb 21, 2022
The Fed is, effectively, a car driving at night, very fast, with no headlights. That is a real threat, probably to an unprecedented degree.

Reviving investment: A pending challenge for Mexico
Alberto González Pandiella and Alessandro Maravalle (OECD Ecoscope) Feb 21, 2022
Mexico is gradually recovering from the pandemic-induced recession.

India’s Giving Inflation Room to Grow, But That May Bite
Andy Mukherjee (Bloomberg Opinion) Feb 21, 2022
The RBI wants to push growth up but cost increases are threatening the survival of smaller firms as they lose market share to their larger rivals.

The Almighty Brent Oil Benchmark Is Broken
Javier Blas (Bloomberg Opinion) Feb 21, 2022
That should be alarming with Brent hovering at $100 a barrel and stoking global inflation. Consider this Brent's Libor moment.

The Hidden Message Behind China’s Big Tech Wipeout
Shuli Ren (Bloomberg Opinion) Feb 21, 2022
Online giants lost more than $90 billion of market value in two days as the government moved to ease the pressure on mom-and-pop businesses

China's Two Traps
Keun Lee (Project Syndicate) Feb 21, 2022
As China’s economic slowdown suggests, the next phase of its development is rife with challenges. While China does not have to adopt Western-style liberal democracy to avoid the “middle-income trap” and the Thucydides Trap, it will have to devise a viable alternative.

China's Real-Estate Balancing Act
Yu Yongding (Project Syndicate) Feb 21, 2022
China’s government has emphasized that policies to address financial vulnerabilities and structural problems should not impede economic growth. But, when it comes to the real-estate sector, that will not be an easy balance to strike – and getting it wrong could have economy-wide repercussions.

The cross-border effects of environmental regulation
Shinsuke Tanaka, Kensuke Teshima, and Eric Verhoogen (VoxEU) Feb 21, 2022
Press accounts of dirty activities springing up in developing countries, in part to evade stricter environmental regulations in developed ones, are all too common. But previous academic research has found little systematic evidence of such pollution-haven effects between the global North and South. This column looks at the recycling of lead-acid batteries in the US and Mexico, and finds that tightened US regulations around lead increased exports of batteries to Mexico for recycling, worsening health outcomes for locals, especially the poor.

Governments should not foot the bill for stranded assets
FT View Feb 22, 2022
Treaties that lead to fossil fuel bailouts need a rethink.

As inflation rises, the monetarist dog is having its day
Martin Wolf (FT) Feb 22, 2022
Economists are being forced to relearn lessons about the importance of the money supply.

MSCI needs to add Israel to its Europe index
Glenn Yago (FT) Feb 22, 2022
Cross-border connections matter more than geography.

How Xi Jinping’s anti-corruption crusade went global
Edward White and Victor Mallet (FT) Feb 22, 2022
As China’s leader appears set for an unprecedented third term, the hunt for fugitives beyond China’s borders has accelerated.

Why post-Brexit race in financial regulation is a bad strategy
Helen Thomas (FT) Feb 22, 2022
UK has hurriedly announced changes to insurance rules but watchdog is right to be cautious.

Why European bank shares are experiencing a false dawn
Patrick Jenkins (FT) Feb 22, 2022
Hopes of fatter margins on lending are offset by risks ignored by investors at their peril.

Global Banks Poised for Turmoil as West Hits Russia With Sanctions
Lananh Nguyen and Alan Rappeport (NYT) Feb 22, 2022
The U.S. and Britain are aiming to throttle Russia’s access to foreign capital. But things could get complicated for the entire global financial system.

Debt and Inflation Threaten U.S. Security
Jeb Hensarling (WSJ) Feb 22, 2022
Servicing costs could soon reach $1 trillion a year, which would crowd out spending on defense.

Indonesia bans mineral exports to move up value chain
Scott Foster (AT) Feb 22, 2022
Indonesia is taking control of its mineral resources, incentivizing investment in processing facilities and shifting the international balance of economic power. By imposing a one-month ban on the export of thermal coal to avoid a domestic shortage in January, President Joko Widodo signaled he would not allow private interests to undermine the national economy.

IMF must regain lost territory
Kevin Gallagher and Rachel Thrasher (OMFIF) Feb 22, 2022
Often depicted as a rigid institution averse to change, the International Monetary Fund deserves credit for embracing climate concerns, showing signs of abandoning austerity and calling out the G20 for its weak debt relief efforts during the pandemic. However, the most profound change came in 2012 when the IMF partially reversed its longstanding view on capital account liberalisation. In March, the IMF board meets to revisit this view, providing a crucial opportunity to take a step forward.

Should Monetary Finance Remain Taboo?
Itai Agur, Damien Capelle, Giovanni Dell’Ariccia, and Damiano Sandri (IMF) Feb 22, 2022
In exceptional times, monetary finance may provide helpful policy support but there are risks.

Norway: Five messages from the latest OECD Economic Survey
Ben Conigrave, Philip Hemmings and Isabelle Joumard (OECD Ecoscope) Feb 22, 2022
Norway has handled the pandemic better than many other countries and continues to have good outcomes on many economic and social dimensions.

Key to Curbing Inflation Lies Within Corporate Costs
Conor Sen (Bloomberg Opinion) Feb 22, 2022
While price increases will probably stick, consumers should get years of stability after costs fall for industry.

Edward N. Wolff (Project Syndicate) Feb 22, 2022
In recent decades, inflation has been a boon to middle-class US households’ balance sheets, thus helping to mitigate the increase in overall wealth inequality. Those worrying about the recent uptick in inflation – beginning with the Federal Reserve – should bear this in mind when considering whether and how much to tamp it down.

The Case Against Fed Gradualism
Willem H. Buiter (Project Syndicate) Feb 22, 2022
After two decades of never raising policy rates by more than 25 basis points at a time, the US Federal Reserve is now confronting macroeconomic conditions that demand more robust action. If the Fed proceeds too slowly, it will jeopardize its own credibility.

Why Democracy Stalled in the Middle East
Amaney A. Jamal and Michael Robbins (FA) Feb 22, 2022
Economic despair and the triumph of the China model.

What’s the Best Measure of Economic Slack?
Regis Barnichon and Adam Hale Shapiro (FRBSF Econ Letter) Feb 22, 2022
Different ways of measuring the economy’s unused capacity, or slack, can result in varying inflation forecasts. Estimates suggest that direct measures of labor market tightness, such as the ratio of job vacancies to unemployment or the rate of employee job switching, provide more accurate forecasts than commonly used measures, such as the unemployment rate or the output gap. Recent elevated values of these measures of labor market tightness suggest greater inflation pressure than is implied by the unemployment rate alone.

Sanctions and high energy prices test global economic resilience against Ukraine crisis
Chris Giles (FT) Feb 23, 2022
Advanced countries have capacity to cope but Russia’s actions increase uncertainty over when to tighten monetary policy.

Ukraine conflict: the risks looming for investors
Katie Martin (FT) Feb 23, 2022
Rising energy costs may worsen inflation shock and sap economic growth.

All eyes are on Lebanon’s top banker as the country slides deeper into financial peril
David Gardner (FT) Feb 23, 2022
Riad Salameh has so far eluded the justice system at home, but European investigators are tightening the noose.

Russia Is Sowing Conflict in Ukraine. What Does That Mean for the U.S. Economy?
Jeanna Smialek and Ana Swanson (NYT) Feb 23, 2022
A Russian invasion of Ukraine could push up oil and food prices globally at a time of already-high inflation. In the U.S., it will drive up uncertainty.

Yellen’s Global-Tax Race to Nowhere
WSJ Feb 23, 2022
The 15% minimum corporate rate hits U.S. companies hardest.

UK Economy Rebounding Amid Growing Inflationary Pressures
IMF Feb 23, 2022
Thanks to a rapid vaccination campaign and highly accommodative policies, the United Kingdom’s economic recovery has proceeded faster than expected. The near-term growth outlook remains strong—but so too are inflationary pressures.

Governments Must Choose to Support or Restructure Heavily Indebted Firms
Ceyla Pazarbasioglu and Rhoda Weeks-Brown (IMF) Feb 23, 2022
To stave off risks to recovery, policymakers should focus support on firms that can survive and prepare to restructure or liquidate those that cannot.

Pension Funds Would Benefit From Overseas Adventures
Mark Gilbert (Bloomberg Opinion) Feb 23, 2022
Home bias may become a problem for U.S. pension funds.

Don’t Count on Higher Rates to Stall the Housing Market
Stephen Mihm (Bloomberg Opinion) Feb 23, 2022
Real estate prices can be slow to respond to changes in borrowing costs — if they respond at all. Some economists who have documented this history call it “inertia.”

Africa's Unfinished Trade Agenda
Hippolyte Fofack (Project Syndicate) Feb 23, 2022
While many observers have touted the African Continental Free Trade Area as a game changer for the continent, trade liberalization alone will not necessarily guarantee economic success. Member countries must also implement robust trade facilitation measures, and engage with external partners as a unified trading bloc.

Our New Cloud-Based Ruling Class
Yanis Varoufakis (Project Syndicate) Feb 23, 2022
Capital is everywhere, yet capitalism is on the wane. In an era when the owners of a new form of "command capital" have gained exorbitant power over everyone, including traditional capitalists, this is no contradiction.

Why Isn't E-Commerce Benefiting the Arab World?
Sami Mahroum (Project Syndicate) Feb 23, 2022
Although headline measures of digitalization and e-commerce are growing steadily in the Middle East and North Africa, the outlook is anything but rosy. Not only is internet access largely limited to those with higher incomes, but the bulk of the goods and services being traded comes from foreign suppliers.

Proposing a faster, more progressive approach to trade reform
Klaus Schwab and Sean Doherty (VoxEU) Feb 23, 2022
Concerns about globalisation have intensified in recent years. A recent survey from the World Economic Forum revealed that while three-quarters of those surveyed thought expanding trade was a good thing, less than half thought globalisation was good for their own country. This column argues that globalisation contributes broadly to prosperity and freedom, but that it must be harnessed in ways that bring improved living standards and justice to all. Faster progress toward these goals demands effective public-private cooperation.

Nick Bennenbroek, Brendan McKenna, and Jessica Guo (WF Econ Group) Feb 23, 2022
Inflation remains a key focus of global financial markets as price pressures around the world persist. In response to elevated CPI readings, central banks have continued to shift in a hawkish direction. This month, the Bank of England and European Central Bank moved to a more hawkish inflation-fighting posture on monetary policy. rguably, the Fed has made the most drastic shift in its stance on monetary policy. Financial markets have priced aggressive Fed tightening, and we believe FOMC policymakers are set to raise policy rates five times this year as well as begin the process of shrinking its balance sheet. As the Fed tightens monetary policy, and as financial markets may be priced for too much tightening abroad, we expect the U.S. dollar to strengthen against most foreign currencies. Russia-Ukraine developments have also taken center stage. Tensions have escalated as President Putin officially recognized separatist groups in the Donbas region. In response, the U.S. along with the EU and U.K. have imposed new sanctions in an attempt to curtail further escalations. Global economic growth is likely not at risk should Russia or Ukraine fall into recession; however, given Russia is a major oil exporter, activity could slow and inflation could rise as oil supply potentially gets pulled out of the market.

The ECB must move slowly on interest rates
Megan Greene (FT) Feb 24, 2022
Premature withdrawal of monetary accommodation could kill the recovery.

Why Is China Building So Much in Africa?
Charles Kenny (CGD) Feb 24, 2022
Chinese construction firms have captured a lot of the market in many developing countries and perhaps especially in African countries. By one estimate, they accounted for 31 percent of all construction projects in Africa with a value of $50m or more in 2020. One reason as to why may well be finance—as Nancy Lee and Mauricio Cardenas Gonzalez point out, China is providing a lot more cash for public-private infrastructure partnerships than Western development finance institutions (DFIs), to say nothing of the country’s considerable lending towards public infrastructure. In 2020, perhaps 15 percent of the total finance for all large construction projects in the region came from China. Other explanations for Chinese construction dominance veer towards governance, with accusations of corrupt payments and diplomatic arm-twisting.

Economic Indicators Signal Diminished Growth Momentum at Start of Year
Tryggvi Gudmundsson (IMF) Feb 24, 2022
The economic recovery continues, though the pace of the recovery has slowed. Notably, our global forecast was lowered in January to a still-healthy 4.4 percent expansion this year. This was down from an October projection of 4.9 percent, amid reduced growth prospects for the United States and China, the two largest economies. Meanwhile, inflation has been higher than expected in many economies, while financial markets remain volatile as geopolitical tensions have increased.

Economic Power is the West's Best Weapon Against Putin
Bloomberg View Feb 25, 2022
Harsher sanctions are needed to deter further aggression.

Russia Isn’t the Only Emerging Market Suffering
Marcus Ashworth (Bloomberg Opinion) Feb 24, 2022
The pain of sanctions are definitely starting to be felt, and it’s not just Russia being penalized.

The Questions Investors Now Need to Consider Now
Aaron Brown (Bloomberg Opinion) Feb 24, 2022
The year following aggression events has been slightly better than average for markets, but that doesn’t mean there aren’t risks.

China Can’t Control Its Iron Ore Roller Coaster
David Fickling (Bloomberg Opinion) Feb 24, 2022
Attempts to rein in this market are unlikely to succeed. Just like Beijing’s other failed efforts to regulate commodity prices.

Resilient China
Andrew Sheng and Xiao Geng (Project Syndicate) Feb 24, 2022
Rather than doing what is required to bolster public trust, many political leaders, particularly in the West, have sought to unite their populations by framing and highlighting external threats, especially China and Russia. This has left China with little choice but to redouble its efforts to build resilience at home.

The Challenge of Convergent Crises
Muhammad Hamid Zaman (Project Syndicate) Feb 24, 2022
After more than two years of the COVID-19 pandemic, the global community has little interest in addressing the problem of drug-resistant pathogens. But highlighting the links between antimicrobial resistance, climate change, and violent conflict could encourage world leaders to reconsider their priorities.

Fighting the Last Inflation War
Jeffrey Frankel (Project Syndicate) Feb 24, 2022
In the decade that followed the 2008 global financial crisis, some central banks overestimated the dangers of inflation and pursued unnecessarily tight monetary policies. In 2021, they fought the last war yet again, but this time by underestimating the risks of rising price pressures.

Otaviano Canuto, Justin Yifu Lin, and Pepe Zhang (Project Syndicate) Feb 24, 2022
Supply shortages during the COVID-19 pandemic have set off a rush to reshore or nearshore production in the name of national security and resilience. But policymakers tasked with shaping new industrial policies should have no illusions that there are shortcuts to economic development.

America Is Fueling Chinese Techno-Nationalism
Keyu Jin (Project Syndicate) Feb 24, 2022
The US campaign to limit Chinese firms' access to critical technologies has backfired. China has responded by pursuing its goal of bolstering its technological capabilities with an intensity unseen since Mao Zedong committed to developing nuclear weapons six decades ago.

The private equity industry in the new interest rate environment
Victoria Ivashina (VoxEU) Feb 24, 2022
As interest rates shift from a decades-long decline to hovering at the zero lower bound and potentially increasing significantly, the private equity industry will face new pressures. The inflow of capital to the asset class will decelerate, leading to an increased scrutiny of costs and an opportunity to shift bargaining power to limited partners. The first LTI Report argues that while the private equity industry has made promising steps towards innovation to preserve momentum, the adverse macroeconomic pressures will likely still prevail, affecting the industry’s growth and, subsequently, its cost structure, which remains a controversial subject.

The crisis in Ukraine adds a further dose of uncertainty to markets
Merryn Somerset Webb (FT) Feb 25, 2022
Investors have ridden out previous geopolitical tremors, but this one might be different.

Capital markets union is key to a sovereign EU
Theodor Weimer (FT) Feb 25, 2022
Without it, the bloc will not be able to secure its ambitions for digitisation and the green transition.

How will Russia’s invasion of Ukraine hit the global economy?
Chris Giles, Jonathan Wheatley and Valentina Romei (FT) Mar 25, 2022
Soaring energy prices alone could tip the world into a second recession in three years.

Is there a new supercycle in metals and minerals?
Neil Hume (FT) Mar 25, 2022
Low-carbon policies stoke demand for lithium, cobalt and copper, but investors must judge whether the boom will last.

China’s SWIFT alternative may undercut US sanctions
David P. Goldman (AT) Feb 25, 2022
Washington’s new sanctions against Russia were no match for President Biden’s rhetoric, leaving out the most obvious measure that the United States might take to hurt Moscow, namely exclusion from the SWIFT international payments system. But a new Chinese alternative might allow Russia to conduct most of its trade in yuan rather than dollars.

The Almighty Dollar Isn't the Currency to Fight Russia
Paul J. Davies (Bloomberg Opinion) Feb 25, 2022
The euro’s important role in Russian trade and finance means Europe has to take the lead on sanctions.

Russia's War and the Global Economy
Nouriel Roubini (Project Syndicate) Feb 25, 2022
It is tempting to think that the war in Ukraine will have only a minor economic and financial impact globally, given that Russia represents merely 3% of the world economy. But policymakers and financial analysts need to avoid such wishful thinking.

The political economy of policy learning: Evidence from China
Shaoda Wang and David Yang (VoxDev) Mar 2, 2022
While China’s bureaucracy and institutions allow large-scale policy experimentation, incentives in complex political environments can inhibit policy learning

Inflation: A Slower Climb Down
Sarah House (WF Econ Group) Feb 25, 2022
While it is still plausible for inflation to peak on a year-over-year basis in February, the descent appears to be slower going based on the rise in commodity prices and broad strength in January's CPI data, leading us to raise our estimates for inflation this year.

Cold market logic kicks in after Putin blindsides fund pros Ukraine war disrupts global market for grains
John Dizard (FT) Feb 26, 2022
Black Sea port closures threaten food supplies around the world.

Six factors to guide investors during Ukraine turmoil
Mohamed El-Erian (FT) Feb 26, 2022
Portfolios will need to be prepared to deal with a wide range of ‘what if’ scenarios.

Credit cycle turning as Ukraine war adds to inflation concerns
Joe Rennison (FT) Feb 26, 2022
Oil price surge and supply chain disruptions could add to pressure on rising prices.

The new energy shock: Putin, Ukraine and the global economy
Derek Brower, Tom Wilson and Chris Giles (FT) Feb 26, 2022
The Russian invasion has led to sharp rises in worldwide energy prices, increasing the risk of higher inflation and reduced growth.

The economic consequences of the war in Ukraine
Economist Feb 26, 2022
Expect higher inflation, lower growth and some disruption to financial markets.

The Future of the U.S.-China Relationship Lies in 1972
Robert Bruce Zoellick (Bloomberg Opinion) Feb 26, 2022
A New Shanghai Communique, based on the Nixon-era agreement, could help resolve tensions without mincing words.

The Case for a Punitive Tax on Russian Oil
Ricardo Hausmann (Project Syndicate) Feb 26, 2022
Current demand and supply dynamics mean that a punitive tax on Russian oil would be both onerous for Russia and profitable for the rest of the world, making it more credible and sustainable than an embargo. The idea deserves considerably more attention than it has received.

Global financial risk factors and sovereign risk
Simon Gilchrist, Bin Wei, Vivian Yue, and Egon Zakrajšek (VoxEU) Feb 26, 2022
The interconnections between the balance sheet of a sovereign and those of global financial institutions can lead to a widening of sovereign spreads unrelated to country-specific fundamentals. This column explores this financial-sovereign risk nexus and documents that a substantial portion of the co-movement among sovereign spreads can be accounted for by changes in global financial risk. Specifically, an increase in global financial risk causes a large and persistent widening of sovereign spreads, with the spillover effects especially pronounced for speculative-grade sovereign debt.

The EU must deploy financial shock and awe against Putin’s aggression
Martin Sandbu (FT) Feb 27, 2022
Are Europe and the west willing to maximally isolate the Russian economy?

War in Ukraine Complicates the Fed’s Inflation Strategy
Judy Shelton (WSJ) Feb 27, 2022
The central bank ought to use this moment to reduce its significant footprint in financial markets.

Global Markets and Economy Can’t Escape War in Ukraine
Mohamed A El-Erian (Bloomberg Opinion) Feb 27, 2022
The West’s response to Russia’s invasion will most likely have significant consequences for the financial system and investors.

China Can Bypass SWIFT by Putting Digital Money in Play
Andy Mukherjee (Bloomberg Opinion) Feb 27, 2022
Banks must send messages to move funds. Sanctions against Russia underscore the need for Beijing to cut the cord to the U.S.-dominated system.

Historical gender discrimination does not explain comparative Western European development
Nuno Palma, Jaime Reis, and Lisbeth Rodrigues (VoxEU) Feb 27, 2022
The comparatively slow economic growth of Southwestern Europe since the Middle Ages is often attributed to gender discrimination and the idea that women had more agency in England and the Low Countries, which kept fertility levels low and human-capital formation high. This column combines a dataset from six centuries of archival sources with a qualitative discussion of comparative social norms to show that women in Portugal were no more discriminated against than women in other parts of Western Europe, which suggests that other factors must be responsible for the divergence in incomes.

China, Russia and the race to a post-dollar world
Rana Foroohar (FT) Feb 28, 2022
Financial markets are going to become a major field of battle — a place to defend liberal values and renew old alliances.

The best bet for the 2020s is short tech, long commodities
Ruchir Sharma (FT) Feb 28, 2022
Silicon Valley manias tend to lose steam when investors realise they have been pouring money into unprofitable ideas.

Emerging markets recoil from Ukraine war shock
Jonathan Wheatley (FT) Feb 28, 2022
Russian invasion adds to concerns over impact of higher prices for oil and other commodities.

Russia’s FX reserves slip from its grasp
Joseph Cotterill (FT) Feb 28, 2022
Officials in Moscow will be hard pressed to halt a collapse in the rouble. Here’s why.

Public markets might be set for a comeback
John Plender (FT) Feb 28, 2022
A little of the gloss may finally be coming off private equity investments.

As Sanctions Batter Economy, Russians Face the Anxieties of a Costly War
Anton Troianovski, Ivan Nechepurenko and Sergey Ponomarev (NYT) Feb 28, 2022
The ruble plunged, the stock market was shuttered and foreign investors shed holdings in Russian companies, deepening the concern among citizens who had become accustomed to the perks of globalization.

Boot Russia From the WTO
James Bacchus (WSJ) Feb 28, 2022
Member states have the legal authority. The question is whether they have the political will.

China can break SWIFT sanctions but at a high cost
David P. Goldman (AT) Feb 28, 2022
In the past, exclusion from SWIFT meant complete isolation from global markets and normal trade financing, as in the case of American sanctions against Iran. But the Cross-Border International Payments System (CIPS) system, which China began to develop in 2015, is now fully operational and can replace SWIFT for Russian trade financing.

International Financial Institutions Must Help the Ukrainian People
Nancy Lee, Rakan Aboneaaj and Clemence Landers (CGD) Feb 28, 2022
There are two responses that could show political resolve and ease, at least in a limited way, the suffering of the Ukrainian people. First, as our colleague Scott Morris has suggested, they can issue forceful statements condemning Russia’s violent aggression and cease any remaining finance in Russia. And second, they can provide rapid-disbursing finance for the countries bordering Ukraine that will host the majority of massive refugee inflows. The UN estimates 500,000 Ukrainians have already fled, and an early estimate from the UNHCR suggested that refugee totals could reach up to 4 million.

Developing economies face a rough ride as global interest rates rise
Indermit Gill (Brookings) Feb 28, 2022
Inflation has defied expectations everywhere. Half of all inflation-targeting central banks in developing economies now face inflation rates above their target range. Economic growth is slowing in low- and middle-income economies. And a cycle of monetary-policy tightening has begun that already is unlike any in recent memory. A month from now, the U.S. central bank is expected to raise interest rates, and investors are bracing for a big increase—the largest in more than 20 years.

Wielding SWIFT Against Russia Is a Big Risk
Bloomberg View Feb 28, 2022
There are other ways to punish Vladimir Putin that would cause much less collateral damage.

What Progressives Get Wrong About the Gilded Age
Adrian Wooldridge (Bloomberg Opinion) Feb 28, 2022
Two cheers for the economic competition and dynamism of the historical era — and a raspberry for the eponymous TV show.

Don't Count on an Easy Fed Rescue From the Ukraine Fallout
Daniel Moss (Bloomberg Opinion) Feb 28, 2022
The central bank has options to reassure markets and steady the global economy, but they are neither cost-free nor straightforward.

The West Weaponizes Russia’s Central Bank Against Putin
Timothy L O'Brien (Bloomberg Opinion) Feb 28, 2022
The sanctions have the potential to devastate the country’s economy and sow the seeds of Putin’s downfall.

Markets Still Don’t Get How Far the Fed Might Go
William C Dudley (Bloomberg Opinion) Feb 28, 2022
U.S. debt burdens will be much less of a drag than investors appear to expect.

Pariah Status Starts to Exact a Financial Toll on Russia
Marcus Ashworth and Mark Gilbert (Bloomberg Opinion) Feb 28, 2022
Companies severing Russian financial links could help ostracize the nation.

Stop Financing Putin's War
Simon Johnson (Project Syndicate) Feb 28, 2022
Every day, the European Union, the United Kingdom, and the United States send Russia an average of $500 million for oil and gas. But there is good reason to believe that Russia could not withstand an embargo on its energy products.

Protecting the Democratic Dividend
Kaushik Basu (Project Syndicate) Feb 28, 2022
The close connections between democracy, creativity, and economic progress are subtle and long-term, but they are real. In the face of a growing authoritarian challenge worldwide, democratic governments must act together to protect them.

Biden's Frozen Trade Policy
Anne O. Krueger (Project Syndicate) Feb 28, 2022
The postwar era of widespread, robust global economic growth attests to the power of trade liberalization and US leadership within the international trading system. Unfortunately, the current US administration has failed to reverse its predecessor's disastrous policies, leaving American producers and their workers worse off.

The Fed's Historic Error
Mohamed A. El-Erian (Project Syndicate) Feb 28, 2022
The US Federal Reserve’s series of suboptimal decisions in the last 12 months regarding inflation means that its next policy decision also is likely to be suboptimal. Rather than being able to deliver a smooth landing for the US economy, the Fed must now judge what constitutes the least harmful option.

The post-2008 boom in foreign currency corporate bonds
Charles Calomiris, Mauricio Larrain, Sergio Schmukler, and Tomás Williams (VoxEU) Feb 28, 2022
The 2008 global crisis was followed by a boom of US dollar-denominated bonds in emerging markets. This column shows that this post-2008 growth was characterised particularly by large bonds, with principal greater than or equal to $500 million. Key drivers of this boom were the development of emerging market corporate bond indices and the increasing interest of institutional investors from developed countries in emerging markets. This growth in dollar-denominated borrowing could create instability in emerging markets, especially as US monetary policy begins to tighten.

Prospects of the global economy after Covid-19
Daron Acemo?lu, Thorsten Beck, Maurice Obstfeld, and Yung Chul Park (VoxEU) Feb 28, 2022
As the world is (hopefully) emerging from the Covid-19 pandemic, major challenges await societies across the world related to climate change, inequality, digitalisation, and the undermining of democracy. A new book from CEPR and the Korea Institute of Finance discusses the institutional changes needed to address these challenges and the necessary reforms to make the global financial system more resilient.

Putin’s Economic Miscalculation in Invading Ukraine
John Cassidy (New Yorker) Feb 28, 2022
The Russian leader apparently failed to anticipate the unprecedented targeting of the Central Bank of Russia, a step that has battered the ruble.

Who Has Economic and Financial Exposure to Russia?
Jay H. Bryson and Nicole Cervi (WF Econ Group) Feb 28, 2022
Western countries have imposed significant economic and financial sanctions on Russia. These sanctions could have a crippling effect on the Russian economy, which could then have indirect repercussions for other countries. Who has economic and financial exposure to Russia?

This Time Is Different... Because We Are
Mary C. Daly (FRBSF Econ Letter) Feb 28, 2022
The Federal Reserve has evolved since the “Great Inflation” of the 1970s. With new tools and a deeper understanding of the importance of transparency, it is better prepared to meet the dual mandate goals of price stability and full employment, even in challenging times.

The New Russian Sanctions Playbook
Edward Fishman and Chris Miller (FA) Feb 28, 2022
Deterrence is out, and economic Attrition is in.

Washington and Brussels Let Slip the Dollars of War
Amy Mackinnon (FP) Feb 28, 2022
Unlike in 2014, Western countries are rapidly ramping up economic sanctions against Russia’s attempts to rewrite Europe’s geography.