News & Commentary:

Articles/Commentary

Germany’s economy needs a spring clean
FT View May 1, 2019
A proven export model should tilt toward more investment at home.

Rise of the robots threatens developing world workers
Simon Johnson (FT) May 1, 2019
Investment may already be shifting to richer countries amid automation and reshoring.

Don’t get carried away by the big China rally
Laurence Fletcher (FT) May 1, 2019
Stimulus effects to be limited, in the world’s second-largest economy and beyond.

Africa will be the new China
Basil El-Baz (FT) May 1, 2019
Investment, co-operation and strategic advantage will boost the continent’s exports to Europe.

Both sides would suffer in new EU-US trade clash
Isabelle Mateos y Lago (FT) May 1, 2019
Europeans should not be complacent about the effect of uncertainty on investment.

Why Boris Johnson looms large over Brexit
George Parker (FT) May 1, 2019
The prospect of the former foreign secretary becoming prime minister permeates all debates on what comes next.

Honey, We Shrunk the Ex-Im Bank
WSJ May 1, 2019
And nobody outside Washington noticed.

Forget inflation. We should be concerned about deflation.
Robert Samuelson (WP) May 1, 2019
Our worries about inflation are rising faster than it is.

The EU is a doomed empire
Wolfgang Streeck (LMD) May 1, 2019
European tensions are growing. There is Brexit, a Germany without direction, and nationalist forces that aim to bend the EU to serve their own project.

Trump's Trade War Against China Covers Historically Huge Amount of Imports
Chad P. Bown, Eva (Yiwen) Zhang (PIIE) May 1, 2019
The United States has imposed special protection on imports from China for decades, but the long, historical view shows the enormous scope of tariffs imposed in 2018.

Europe’s Rebound Shows Draghi Got it Right
Ferdinando Giugliano (Bloomberg View) May 1, 2019
Better-than-expected economic data vindicates the ECB’s decision to offer only a limited stimulus package in March.

Value Workers as Much as Shareholders
Raghuram G Rajan (Bloomberg View) May 1, 2019
Corporations need to take a much more holistic view of what ultimately adds to their bottom lines.

The World Shouldn’t Save the Belt and Road
Mihir Sharma (Bloomberg View) May 1, 2019
China doesn’t have the money to fulfill its infrastructure-building ambitions. That doesn’t mean the West should pay up.

Jeremy Corbyn Is Playing a Strong Hand Well on Brexit
Therese Raphael (Bloomberg View) May 1, 2019
The Labour Party’s contortions on Brexit are sound political strategy. The big question is whether it all holds together until the next national election.

We Are All Active Investors Now
Larry Hatheway (Project Syndicate) May 1, 2019
Strategic asset-allocation decisions determine most of an investment portfolio’s subsequent return. Investors need to focus more on the composition of their portfolios and worry less about whether they are actively or passively managed.

The World’s Next Big Growth Challenge
Michael Spence (Project Syndicate) May 1, 2019
The economic performance of lower-income developing countries will be crucial to reducing poverty further. Although these economies face significant headwinds, they could also seize important new growth opportunities – especially with the help of digital platforms.

The Time Has Come for a Global Carbon Emissions Tax
Mats Persson (Project Syndicate) May 1, 2019
Since the 2015 UN climate conference in Paris, emissions have continued to rise steadily, increasing the concentration of atmospheric CO2 at an alarming rate. Clearly, the prevailing approach to climate action – centered on voluntary, quantitative targets – is fundamentally flawed.

How to Rebuild America’s Economic Foundations
Jonathan Gruber and Simon Johnson (Project Syndicate) May 1, 2019
Unfortunately, the US is not making the best use of one of its biggest advantages, relative to its international competitors: a lot of smart people are dispersed, for historical reasons, across many cities. Any effective infrastructure strategy must reckon with the problem of coastal economic agglomeration.

Tax hikes are not always contractionary
Samara Gunter, Daniel Riera-Crichton, Carlos Vegh and Guillermo Vuletin (VoxEU) May 1, 2019
Based on evidence from the industrial world, and particularly Europe, tax hikes have a significant negative effect on economic activity. The column shows that this empirical finding does not hold for a broader sample. In the developing world, higher taxes may be an effective way to raise revenues without reducing GDP. This is especially true in countries with low provision of public goods or commodity-dependent countries.

Transfer multipliers: Evidence from Brazil
Raphael Corbi, Elias Papaioannou and Paolo Surico (VoxEU) May 1, 2019
The recent political crisis in the euro area has brought the design of fiscal policy to the forefront of public debate, with many arguing that EU-level transfers are necessary for the ‘completion’ of EMU. This column uses extensive data from a Brazilian federal transfer scheme to show that transfers can play a valuable stabilisation role in a currency union.

China’s Belt and Road Partners Aren’t Fools
Jacob Mardell (FP) May 1, 2019
China's Belt and Road Initiative might not be perfect—but its partners are going in with both eyes open.

‘Global Britain’ Is a Pipe Dream
Dalibor Rohac (FP) May 1, 2019
The idea of a Global Britain always rested on shaky premises, and if Brexit slogans centered on taking back control sounded good in 2016, that won’t be so easy in the Trump era.

The Jones Act does not add to our nation’s defenses
Philip Hoxie and Vincent H. Smith (AEI) May 1, 2019
Advocates for the Jones Act claim that the act is essential for the US military shipbuilding industry’s long-run survival. However, the companies that build vessels for the Navy largely do not rely on the Jones Act for their economic survival. Current Jones Act merchant vessels have accounted for under 5 percent of all orders since 2000 among firms that build both military and Jones Act merchant vessels.

Burst of US economic growth may yet subside
FT View May 2, 2019
The Federal Reserve is right to remain cautious about short-term developments.

Brexit makes the case for an independent Scotland
Philip Stephens (FT) May 2, 2019
At the whim of the Tory party, Scots have been told to surrender their European identity.

The SEC must solve its cryptocurrency custody conundrum
Jay Baris (FT) May 2, 2019
Too much regulation may stifle innovation but too little will put Main Street investors at risk.

US shale boom has blunted impact of global oil threats
David Sheppard (FT) May 2, 2019
Despite sanctions, civil war and tainted supplies, traders are fixated on the long term.

Manufacturing Can’t Create Enough Jobs. Infrastructure Can.
Louis Uchitelle (NYT) May 2, 2019
Automation and offshoring have replaced many laborers on American assembly lines, but signature public works projects could generate an alternate source of well-paid hourly work.

Tech’s raid on the banks
Economist May 2, 2019
Digital disruption is coming to banking at last.

Fed Evaluates Policy and Portfolio Strategy
Tiffany Wilding (PIMCO) May 2, 2019
A quiet and unsurprising FOMC statement belies the important policy discussions and decisions ongoing at the Fed.

The Fed Needs a Better Feel for Markets
Mohamed Aly El-Erian (Bloomberg View) May 2, 2019
Selloffs even after a no-drama meeting show that the U.S. central bank doesn’t understand prevailing narratives well enough.

Europe Tries to Sidestep the U.S. Finance System
Lionel Laurent (Bloomberg View) May 2, 2019
The vehicle being touted as a way to get around Trump’s Iran sanctions has faced plenty of skepticism. But it’s serving a political purpose already.

U.S. Expansion May Be Nowhere Near an End
Nir Kaissar (Nir Kaissar) May 2, 2019
As the current period of growth nears the longest on record, history suggests it may have much further to run.

No, South Korea Doesn’t Need Another IMF Rescue
Daniel Moss (Bloomberg View) May 2, 2019
It does need to find a way out of this rut, though.

Why Stephen Moore Wasn’t Fit for the Fed
Narayana Kocherlakota (Bloomberg View) May 2, 2019
It’s not just his controversial comments and tax issues. It’s not even his advocacy of commodity-price stabilization. It’s that his positions seem to shift for partisan reasons.

The Fed Muddled Its Inflation Message
Timothy A Duy (Bloomberg View) May 2, 2019
Central bank policy makers are looking for reasons to ignore the lack of upward pressure in consumer prices.

The Real Stimulus Choice in China
Dinny McMahon (Bloomberg View) May 2, 2019
It’s not between boosting the economy and deleveraging. It’s between current efforts and much worse.

The Commercial Case for EU Solidarity
Joschka Fischer (Project Syndicate) May 2, 2019
In the 15 years since the European Union expanded eastward, cultural, political, and historical divisions between East and West have continued to stand in the way of genuine solidarity. But the continent's integrated industrial ecosystems – the value of which even staunch nationalists cannot ignore – still gives reason for hope.

Fight Corruption to Reclaim Europe’s Soul
Guy Verhofstadt (Project Syndicate) May 2, 2019
Laura Codruta Kövesi, the highly effective former head of Romania's anti-corruption office and a candidate to fill a similar role at the EU level, is now the subject of a smear campaign and trumped-up criminal charges. Her case is a perfect example of why Europe needs stronger mechanisms to uphold its values.

U.S.-China Trade
K@W May 2, 2019
Is a Deal Imminent?

China grapples with its BRI lending binge
Gillian Tett (FT) May 3, 2019
The wider world should applaud and strongly encourage these hints of change.

Why America’s great corporate debt binge is probably not over
Robin Wigglesworth (FT) May 3, 2019
Debt-fuelled share buybacks go on, despite investors’ desire for stronger balance sheets.

Why Argentina’s latest policy pivot might just work
Colby Smith (FT) May 3, 2019
Sceptics fear that a return to currency intervention would spell doom for Buenos Aires.

Crisis-era creation revival shows credit markets strain
Joe Rennison (FT) May 3, 2019
New branch of synthetic CDO has lower leverage and different buyers — but risks lurk.

How a Lone Norwegian Trader Shook the World’s Financial System
Jack Ewing and Milan Schreuer (NYT) May 3, 2019
A futures bet gone spectacularly wrong provoked a daylong crisis at one of the clearinghouses that are supposed to be global safeguards.

Banks need to shape up in eastern Europe
Brian Caplen (Banker) May 3, 2019
A new report from the EBRD champions equity over debt and bank finance as the way forward for countries aiming to avoid the middle-income trap, as Brian Caplen describes.

Five Things to Look for in Any Trump-China Deal on Subsidies
Chad P. Bown (PIIE) May 3, 2019
The United States and China have remained tight-lipped during the months-long negotiations to resolve their trade war.

The Future Without Libor, Part I: Transition Framework for Derivatives
Courtney Garcia and Jerome M. Schneider (PIMCO) May 3, 2019
Many investors wonder what will happen in their portfolios following the retirement of Libor as the predominant floating-rate benchmark index. The derivative industry, including investment managers, is preparing for the transition, though uncertainties remain.

The Future Without Libor, Part II: How Will Non-Derivative Markets Transition to Alternative Rates?
Courtney Garcia and Jerome M. Schneider (PIMCO) May 3, 2019
As the transition away from Libor (the London Interbank Offered Rate) as the industry-preferred floating-rate benchmark continues, many investors are raising concerns about how both new and existing short-term and floating-rate instruments currently indexed to Libor will adjust when Libor is no longer available.

Leave the Renminbi Out of US-China Trade Talks
Kenneth Rogoff (Project Syndicate) May 3, 2019
A potential agreement could contain many “win-win” elements, notably concerning intellectual property rights and export subsidies. But pushing China to commit to a more stable exchange rate risks creating major problems when the next big Asian recession hits.

Turbocharging India’s Digital Economy
Alok Kshirsagar and Anu Madgavkar (Project Syndicate) May 3, 2019
New digital ecosystems are springing up across India's economy, transforming business models and delivering huge productivity, efficiency, and growth benefits. And sectors that have not traditionally had technology at their core – such as agriculture, banking, health care, and logistics – are among those with the most potential.

The Economy We Need
Joseph E. Stiglitz (Project Syndicate) May 3, 2019
After 40 years of market fundamentalism, America and like-minded European countries are failing the vast majority of their citizens. At this point, only a new social contract – guaranteeing citizens health care, education, retirement security, affordable housing, and decent work for decent pay – can save capitalism and liberal democracy.

The effects of trade policy might be more diverse than most economists think
Peter Egger and Katharina Erhardt (VoxEU) May 3, 2019
When economists model changes in tariffs, their models make assumptions about the impact of those changes. The column argues that those assumptions are often contradicted in the real world and proposes an approach that relaxes these restrictions. Estimates using this approach show that customary models may severely underestimate the impact of recent tariff increases.

Making Basel III work for emerging markets
Thorsten Beck and Liliana Rojas-Suarez (VoxEU) May 3, 2019
The Global Crisis originated in the financial systems of advanced countries, so it is unsurprising that the Basel III international standards focused on the stability needs of these countries. This column assesses the implications of Basel III for emerging markets and developing economies. It also outlines the recommendations from a task force of current and former senior officials from central banks in these countries on how to make Basel III work for them.

The next US recession is likely to be around the corner
Franck Portier (VoxEU) May 3, 2019
Business economists argue that the length of an expansion is a good indicator of when a recession will hit. Using both parametric and non-parametric measures, this column finds strong support for the theory from post-WWII data on the US economy. The findings suggest there is good reason to expect a US recession in the next two years.

Long-term and intergenerational effects of education
Richard Akresh, Daniel Halim and Marieke Kleemans (VoxDev) May 3, 2019
Evidence from Indonesia shows school construction improves labour and marriage market outcomes, and benefits are transmitted intergenerationally.

Don’t Be Shocked If Trump’s Economy Goes the Way of Bush’s
Richard J Carroll (Bloomberg View) May 3, 2019
The formula is basically the same: tax cuts, higher spending and deregulation.

Southeast Asia: Identity in Search of a Name
Philip Bowring (Globalist) May 4, 2019
What does “Southeast Asia” mean beyond a random chunk of geography?

The implications of non-tariff measures for developing countries’ exports
Jaime de Melo and Alessandro Nicita (VoxEU) May 4, 2019
Developing countries often struggle to access international markets. One reason is that trade regulatory frameworks are becoming more complex, and that contemporary economic integration strategies need to confront policy measures that are well beyond the scope of traditional trade policy. This column discusses those policy measures and options for integrating them into developing countries' strategies.

Eurozone to rebound on domestic and China stimulus
Gavyn Davies (FT) May 5, 2019
Despite lagging the global recovery the outlook is good.

The $100 trillion question: What to do about wealth?
Robert Samuelson (WP) May 6, 2019
Populists are blaming greed for sky-high inequality; that’s simplistic and could lead to the wrong solutions.

I’m Running to Save Capitalism
John Hickenlooper (WSJ) May 5, 2019
Massive deregulation and socialism would both ruin the economic system that allows America to flourish.

How is Brexit affecting FDI into Britain?
Economist May 5, 2019
Foreign investment remains strong, but it would be stronger still were Britain not leaving the EU.

China, Russia and the United States contest a new world order
Dmitri Trenin (EAF) May 5, 2019
It's no G2 world we live in today and that defining strategies as if it were or could be is likely a loser's game.

Southeast Asia: The Silk Road and the Roman Route
Philip Bowring (Globalist) May 5, 2019
The Silk Road’s historical importance has been vastly exaggerated. It was the sea that was the most important link between east and west.

India Needs an Investment Czar
Andy Mukherjee (Bloomberg View) May 5, 2019
The next government must find a technocrat to fix the turmoil in finance and attract overseas capital.

Books not bullets
Dominic Rohner and Alessandro Saia (VoxEU) May 5, 2019
It is widely believed that education is a crucial factor in curbing political violence, but establishing causal evidence of this notoriously difficult. This column uses a large-scale school construction programme in Indonesia and newspaper reports of violence to tackle this problem. The results show that the construction of primary schools led to statistically significant reductions in conflict that grew larger over time.

A bull market in bluff: why guff and baloney are on the rise
Andrew Hill (FT) May 6, 2019
Even if they avoid the jargon trap, innovators and leaders find the temptation to talk crap strong.

A new Brexit divide is driving the UK to a second vote
Robert Shrimsley (FT) May 6, 2019
Intransigent purists on both sides are going to force the issue back to the electorate.

Trump’s latest China tariff threat is just bluster
Edward Luce (FT) May 6, 2019
The US president has a long history of failing to follow through on his warnings.

Eurozone is running low on ways to boost growth
Silvia Ardagna (FT) May 6, 2019
More radical measures from the ECB and other policymakers may be needed.

Why oil could help resolve the US-China trade stand-off
David Sheppard (FT) May 6, 2019
Energy is one area where the two countries have a mutual interest in finding common ground.

Rising cost of government debt unsettles investors in Nigeria
Jonathan Wheatley (FT) May 7, 2019
Lagos makes push for tax revenue, as debt-servicing eats up big portion of receipts.

Why Democrats don’t want to mention Trump’s (trade) war
Demetri Sevastopulo and James Politi (FT) May 6, 2019
Dispute with China has hit farmers but US presidential hopefuls are reluctant to campaign against it.

Trump’s China Brinksmanship
WSJ May 6, 2019
The incentives for a deal are overwhelming on both sides.

Mind the Productivity Gap to Reduce Inequality
Edward P. Lazear (WSJ) May 6, 2019
It isn’t only an American problem, but the U.S. has lessons to learn from other wealthy countries.

Why Trump Is Raising Tariffs on China
Michael Pillsbury (WSJ) May 6, 2019
The president’s tough line will reduce friction later by giving Beijing an incentive to comply with a trade deal.

We’re in an economic war with China. It’s futile to compromise.
Stephen K. Bannon (WP) May 6, 2019
The president should not soften his stance against the greatest existential threat the U.S. has ever faced.

Trump is standing firm against China. Congress must stand with him.
Henry Olsen (WP) May 7, 2019
The president should ask for a public display of support from congressional Republicans should he have to act this week.

Trump trade war 2.0 is Asia’s nightmare
William Pesek (AT) May 6, 2019
The US president is desperate to change the narrative on his embattled time in office, and Asia will bear the brunt.

US-China trade deal stuck on enforcement impasse
David Goldman (AT) May 6, 2019
Trump threatens to blow up talks, citing ‘great economic results’ of trade war, but data show weakness in the US economy.

The US-China trade talks are at risk of breakdown
Economist May 6, 2019
After hints of progress, a tweet from Donald Trump sows doubts.

Will Auto Trade Be a Casualty of US-Japan Trade Talks?
Gary Clyde Hufbauer and Euijin Jung (PIIE) May 6, 2019
President Trump’s objectives in launching bilateral trade talks with Japan in late April are clear. He wants to boost US agricultural exports to Japan and reduce US auto imports.

India’s Post-Election Outlook: A Fine Balance
Gene Frieda and Taosha Wang (PIMCO) May 6, 2019
A new round of reforms could help maintain the delicate balance between growth and financial prudence.

Repos: A Fresh Look at a Key Driver of Short-Term Returns
Jerome M. Schneider, Tina Adatia, and Kenneth Chambers (PIMCO) May 6, 2019
It’s time to pay attention to repos, the building blocks of return for many short-term strategies.

Germany Needs a Global Role to Suit Its Size
Bloomberg View May 6, 2019
Rebuilding the country’s military would be just the start.

The Theory That (Might) Explain Trump’s Trade War
Karl W Smith (Bloomberg View) May 6, 2019
One school of economic thought argues that bilateral agreements are better than multilateral ones.

Trump’s Trade Threats Hurt the U.S. More Than China
David Fickling (Bloomberg View) May 6, 2019
The president justifies tariffs by arguing that China will foot the bill. That theory doesn’t hold up in the real world.

After the Stock Carnage, Wait for the Yawn
Shuli Ren (Bloomberg View) May 6, 2019
Trade tensions are no longer the driving force for markets, in the U.S. or China.

Poverty Is a Bigger Problem Than Gentrification
Noah Smith (Bloomberg View) May 6, 2019
Millions of people languish in decaying cities, while a relative few are pushed out of reviving neighborhoods.

China’s Path Not Taken
Ian Buruma (Project Syndicate) May 6, 2019
China’s tragic modern political history has led some, inside and outside China, to believe that the Chinese are not ready for liberal democracy, or are even unsuited to it. But the more liberal strands of the May Fourth Movement in 1919 – and of the 1989 Tiananmen Square protests that May 4 inspired – should never be forgotten.

Explaining Inflation Inertia
Carmen M. Reinhart (Project Syndicate) May 6, 2019
Despite central bankers' concerted efforts, credible price-stability targets have proved elusive in countries like Argentina, where inflation is soaring, and Japan, which can't shake the specter of deflation. What can governments do to influence inflation expectations when central banks’ policies prove insufficient to the task?

Why Capitalism Needs Populism
Raghuram G. Rajan (Project Syndicate) May 6, 2019
Globalization, digital technologies, and other factors have allowed competitive US corporations to achieve market dominance. If the past is any guide, it is only right that these "superstar" firms should now be challenged by grassroots political movements protesting against an unholy alliance of private-sector and government elites.

Host-country financial development and multinational activity
Kamran Bilir, Davin Chor and Kalina Manova (VoxEU) May 6, 2019
Understanding how host-country financial conditions influence the global operations of multinational firms is important for encouraging FDI. Using US data, this column show that more financially developed economies have more entry by multinational affiliates and higher aggregate affiliate sales to the local market, back to the US and to third destinations, particularly in more financially vulnerable sectors. Yet at both aggregate and affiliate levels, the share of local sales in total sales is smaller, while the shares of US and third-country sales are bigger.

How did China move up the global value chains?
Hiau Looi Kee and Heiwai Tang (VoxDev) May 6, 2019
Liberalising trade and FDI is key to the promotion of domestic value added into a country’s exports, as the Chinese experience highlights.

Doubling Down on the Trade Dispute with China
Jay H. Bryson and Tim Quinlan (WF) May 6, 2019
The trade dispute took a new turn this weekend when President Trump tweeted, just days before a high-ranking Chinese delegation is due to arrive in Washington for the latest round of negotiations, that the increase on the tariff rate would now go into effect on Friday, May 10.

Tariffs Bring Upside Risks to Inflation Back Into the Fore
Sarah House (WF) May 6, 2019
Renewed threats to significantly raise tariffs on Chinese imports have brought back upside risk to the outlook for tepid inflation. While the tariff hikes would boost inflation, the impact is likely to be modest and temporary.

Improving the Phillips Curve with an Interaction Variable
Kevin J. Lansing (FRBSF Econ Letter) May 6, 2019
A key challenge for monetary policymakers is to predict where inflation is headed. One promising approach involves modifying a typical Phillips curve predictive regression to include an interaction variable, defined as the multiplicative combination of lagged inflation and the lagged output gap. This variable appears better able to capture the true underlying inflationary pressure associated with the output gap itself. Including the interaction variable helps improve the accuracy of Phillips curve inflation forecasts over various sample periods.

Oil market in flux amid uncertainty over shipping’s fuel rules
Jason Bordoff (FT) May 7, 2019
Calls to delay IMO rules undermine incentives to minimise any impact on consumer prices.

Public options key to reviving US middle class
Joseph Stiglitz (FT) May 7, 2019
Such government programmes would raise the living standards of millions of Americans.

Investors take on Germany Inc
Guy Chazan (FT) May 7, 2019
Scandals over ‘cosy’ relationships at several top German companies have led shareholders to demand better governance.

Are Trump’s Tariffs Bolstering the U.S. Economy? Nope
Jim Tankersley (NYT) May 7, 2019
President Trump says that his protectionist trade policies have accelerated economic growth, but little evidence supports that claim.

Trump's Tariff Threat on Rest of Chinese Goods Would Hit Final Consumer Products
Chad P. Bown and Eva (Yiwen) Zhang (PIIE) May 7, 2019
In a sudden reversal during the US-China trade negotiations, President Trump tweeted that the United States will increase the 10 percent tariff on $200 billion of imports from China to 25 percent on May 10, 2019.

How to Ensure the Effective and Sustainable Financing of International Development
Christine Lagarde (IMF) May 7, 2019
It is high time for the private sector to embrace a greater sense of social responsibility, focusing more on long-term development and less on short-term profit. Fortunately, we are seeing far greater interest in “impact investing” and financial instruments that embrace environmental, social, and governance issues. This certainly bodes well for the SDGs.

Trade Talks Are Foundering on Mistrust and Arrogance
David Fickling (Bloomberg View) May 7, 2019
A grand bargain between the U.S. and China was always unrealistic without give and take on both sides.

Trump's Trade Tantrum Revives Corporate Headaches
Brooke Sutherland (Bloomberg View) May 7, 2019
For manufacturers like Emerson Electric, renewed tensions mean costs may ramp up rather than level off.

Tariffs Are a Smokescreen for Shrinking China Footprint
Tim Culpan (Bloomberg View) May 7, 2019
Technology companies aren’t keen to put all their eggs in the mainland basket. The trade war is a convenient excuse to get out.

Value Investing Is Back in China, Thanks to Donald Trump
Shuli Ren (Bloomberg View) May 7, 2019
The trade shock has helped renew the appeal of companies that can weather the storm.

The One Bargaining Chip China Won't Surrender
Anjani Trivedi (Bloomberg View) May 7, 2019
The U.S. is using the trade war to push for an overhaul of Beijing’s industrial policy. That's unlikely to happen.

Trade Fears Threaten the Best Stocks in the U.S.
Stephen Gandel (Bloomberg View) May 7, 2019
A sector with an outsize influence on benchmark indexes may be among the hardest hit by renewed tensions between the U.S. and China.

A Trade Deal With China Wouldn’t Change Much
Tyler Cowen (Bloomberg View) May 7, 2019
Any agreement would be difficult to interpret and enforce, leaving tensions at about where they are now.

Trump’s China Gambit May Really Be About the Fed
John Authers (Bloomberg View) May 7, 2019
The escalating trade war has become a complex three-dimensional game of chess. Also, the wealthy are ready to jump back into stocks.

Keeping US Workers in the Game
Laura Tyson and Lenny Mendonca (Project Syndicate) May 7, 2019
With unemployment at a near-historic low, US policymakers might think they don't need to worry about the state of the American workforce. But they would be wrong: without far-reaching measures to expand opportunities for education and reskilling, severe skilled-labor shortages will become inevitable.

Seven Fallacies of Economic Sanctions
Hassan Hakimian (Project Syndicate) May 7, 2019
Despite the pain now being inflicted on Iran's economy by Trump's sanctions, the success or failure of such sanctions depends on whether they bring about regime change, or change a government’s behavior. Given the prevailing misconceptions about their rationale, it is not surprising that economic sanctions so often achieve neither goal.

Growth continues at a more moderate pace: The Commission's Spring 2019 Forecast
Marco Buti, Oliver Dieckmann, Björn Döhring, Bertrand Marc and Andreas Reuter (VoxEU) May 7, 2019
The sharper-than-expected economic slowdown in the euro area last year was driven by a confluence of weaker export demand and sector- and country-specific factors within the euro area. This column introduces the European Commission’s Spring 2019 Forecast, which projects a moderate rebound over the course of this year as global demand bottoms out and some temporary negative factors fade. This will depend on domestic demand holding up despite the stark slowdown in manufacturing, however, and the baseline scenario is subject to downside risks, some of which could be triggered by misguided economic policies. Economic policy should therefore stand ready to react to a sharper and more protracted slowdown should it occur.

The economics of mobile money
Janine Aron and John Muellbauer (VoxEU) May 7, 2019
Mobile money has transformed the landscape of financial inclusion in developing and emerging market countries, leapfrogging the provision of formal banking services. This column explains how mobile money potentially helps ameliorate several areas of market failure in developing economies, including saving, insurance, and the empowerment of women. It illustrates these effects using examples from a burgeoning empirical literature and concludes that the system-wide effects of mobile money may be even greater than current studies suggest.

The Unintended Consequences of Trump’s Trade War
Sam Bresnick and Lucas Tcheyan (TNR) May 7, 2019
Forcing Beijing into economic reform could help it overtake the U.S. in the long run.

A Clean President Can’t Govern From Atop a Tainted Party
Eusebius McKaiser (FP) May 7, 2019
If Cyril Ramaphosa remains in power, he would face the dual challenge of corruption and amping up an economy on a low growth trajectory.

Three questions about emerging economies
McKinsey May 7, 2019
Four leading voices share their perspective on whether emerging markets will continue to drive growth, and how.

Central banks need to be flexible on inflation
Marie Owens Thomsen (FT) May 8, 2019
Balance sheets can be a better policy tool than aiming at a certain level of prices.

How our low inflation world was made
Martin Wolf (FT) May 8, 2019
The picture is one of weak growth and pervasive populist politics.

Norway oil fund ruling raises risk of political meddling
Richard Milne (FT) May 8, 2019
Decision to maintain central bank’s grip has implications on companies all over the world.

The Japanese yen may soon break out of its trading range
Leo Lewis (FT) May 8, 2019
Japan’s shutdown for the abdication of Emperor Akihito did not disturb the currency.

Yes, there will be a US-China trade deal
David Goldman (AT) May 8, 2019
Trump’s previous reality-TV scripts give us clues as to the ending of this episode.

A U.S.-China Trade Deal Doesn't Matter Anymore
Michael Schuman (Bloomberg View) May 8, 2019
Confrontation has already widened beyond the point that such an agreement can resolve.

A Tale of Two Central Banks With the Same Problem
Daniel Moss (Bloomberg View) May 8, 2019
The RBA holds, the RBNZ cuts. There’s a lesson for global peers wrestling with limp growth and persistent inflation misses.

Singapore Spreads the Wealth
Andy Mukherjee (Bloomberg View) May 8, 2019
Transferring a chunk of foreign-exchange reserves to GIC could ease the tax burden on the local population.

Who to Credit for the U.S. Expansion? Maybe George W. Bush
Stephen Mihm (Bloomberg View) May 8, 2019
Ten years of economic growth followed the Great Recession. Two economists think one could’ve led to the other.

The Mighty U.S. Consumer Is Struggling
Danielle DiMartino Booth (Bloomberg View) May 8, 2019
Recent spending patterns combined with credit-card losses reveal some disturbing trends.

Trade Talks Have Two Key Implications for Markets
Komal S Sri-Kumar (Bloomberg View) May 8, 2019
Whatever happens, keep an eye on the dollar and measures of volatility.

Heeding Europe’s Silent Majority
Silvia Merler, Simone Tagliapietra and Alessio Terzi (Project Syndicate) May 8, 2019
Populist and nationalist parties' recent electoral successes have fed a popular narrative that Europeans are souring on the European Union and want to "take back control." In fact, most Europeans not only support the EU, but also want it to take the lead in a broad array of policy areas that currently fall outside of its remit.

Is America Ready for a Welfare State?
Jorge G. Castañeda (Project Syndicate) May 8, 2019
Several leading Democratic candidates in the 2020 US presidential race favor introducing elements of a modern welfare state in health care, childcare, and education. Whether a Democrat wins or loses in 2020, social democracy has re-emerged in American politics for the first time since the 1930s.

Don’t Fear the Euroskeptics
Daniel Gros (Project Syndicate) May 8, 2019
Although the European Union is arguably as popular as ever, the next European Parliament may well contain a large minority of forces skeptical or hostile to further integration. Instead of viewing this as a threat, pro-Europeans should seize the opportunity to start a necessary debate about the continent’s future.

An Industrial Policy for Good Jobs
Dani Rodrik and Charles Sabel (Project Syndicate) May 8, 2019
So-called productive dualism is driving many contemporary ills in developed and developing countries alike: rising inequality and exclusion, loss of trust in governing elites, and growing electoral support for authoritarian populists. But much of the policy discussion today focuses on solutions that miss the true source of the problem.

How Do Zombie Firms Affect Innovation? Evidence from China’s Industrial Firms
Yun Dai, Wei Li and Yongqin Wang (VoxChina) May 8, 2019
Zombie firms are insolvent firms that continue to operate due to continued access to financing at extremely low costs. Nie et al. (2016) find that in the year 2013 about 14 percent of Chinese-listed firms and 7.5 percent of Chinese manufacturing firms are defined as zombie firms. The large amount of financing subsidies distributed to insolvent zombie firms causes a great deal of credit misallocation and impedes the availability of financing for normal firms in China. Based on a Chinese patent application database and an above-scale manufacturing firm database, we find that zombie firms significantly reduce the number of patent applications and total productivity factors (TFPs) of normal firms. For a 1 percent increase in the proportion of zombie firms in the same industry, the total number of patent applications of normal firms decreases by 1 percent, among which the number of invention-type patent applications decreases by 0.5 percent and the TFPs of normal firms decrease by 2.41 percent. The crowding-out effect of zombie firms on innovation is both statistically and economically significant. In terms of the mechanisms, empirical results show that the crowding-out effect is more profound for industries highly dependent on external financing, highly concentrated industries, and non-state-owned normal firms, which are more financially constrained compared to state-owned normal firms. This implies that the crowding-out effect of zombie firms works by distorting credit allocation and harms fair industry competition. This paper highlights the importance of solving the problems caused by zombie firms in order to boost firm innovation and help achieve high-quality development in China.

International competition and national concentration
Alessandra Bonfiglioli, Rosario Crinò and Gino Gancia (VoxEU) May 8, 2019
Recent studies documenting the increase of industrial concentration have raised concerns about an era of monopolies, growing profit shares, and low economic dynamism. Using US data, this column investigates the concentration of import sales by country of origin. The results show that among foreign firms selling to the US, the concentration of sales has remained stable by origin country, but it has fallen when pooling firms from all origins. This suggests that intensified competition in international markets coexists with growing concentration among national producers.

China’s clean tech boom may disrupt status quo
FT View May 9, 2019
Beijing’s green energy industry brings challenges alongside benefits.

The rise of ‘sharp power lending’
Timothy Ash (FT) May 9, 2019
New lenders with their own agendas may have reduced default risk, or merely deferred it.

Europe’s ‘Nationalism’ Turns Out to Be Local
Joseph C. Sternberg (WSJ) May 9, 2019
Le Pen, Salvini and Brexit all have an appeal limited to particular regions of their respective countries.

A Quirk of the Calendar Is Messing With Stocks
Jeff Sommer (NYT) May 9, 2019
Erasing the 2007-2009 bear market from 10-year stock returns has made ‘long-term’ performance look stellar, even though recent returns are unexceptional.

Trade war pushing Asia closer together
William Pesek (AT) May 9, 2019
In Fiji, Asia agreed to upgrade its currency buffer as the region circles the wagons amid Washington's trade war.

Trade war: Is the U.S. panicking due to China’s big hedge?
Alicia García-Herrero (Bruegel/Forbes) May 9, 2019
U.S.-China trade war has suddenly taken centre stage following Donald Trump’s unexpected announcement to ramp up tariffs if no deal is reached. U.S. is in desperate need for a comprehensive victory, and China is ready to make concessions, but not to the extent of transforming its state-led economic model into a market-based economy.

Uganda's Economic Outlook in Six Charts
IMF May 9, 2019
Uganda’s economy continues its robust recovery with projected growth of 6.3 percent in FY2018/19. Timely implementation of public infrastructure and oil-related projects would support growth in the medium term, according to the IMF’s latest assessment of the Ugandan economy.

Brexit's Downsides Are Caused by Our Own Government
George Pickering (Mises Wire) May 9, 2019
Brexit and decentralization are good things, but the unfortuante truth is that harmful post-Brexit policies are equally likely to be imposed by the UK’s own government as by the European bureaucracy.

Inflation Expectations Are Higher – and Will Probably Keep Rising
Steve A. Rodosky (PIMCO) May 9, 2019
We see reasons why the current monetary and fiscal policy rhetoric may support higher inflation.

The Dollar Dictates China’s Need for a Trade Deal
Christopher Balding (Bloomberg View) May 9, 2019
The country's exploding foreign debt means it has to keep hard currency coming in.

The U.S. and China Are Living in Different Universes
David Fickling (Bloomberg View) May 9, 2019
After all the talking, there’s still a huge gap in perceptions. That says as much about the countries' leaders as it does about the state of diplomacy.

Trump Should Let the World Join Fight Against China
Mihir Sharma (Bloomberg View) May 9, 2019
If they’re not careful, the U.S. and other developed nations could drive potential allies into Beijing’s arms.

Why Turkey's Bid to Prop Up the Lira Won't Work
Marcus Ashworth (Bloomberg View) May 9, 2019
Investors have little confidence that the government will let the central bank control inflation.

The Population Bomb Is Fizzling, But That Won’t Save the Planet
Justin Fox (Bloomberg View) May 9, 2019
Human ingenuity thwarted past predictions of population-growth-induced disaster. Now that population growth is slowing, it’s still ingenuity that we need.

The Case for Intelligent Industrial Policy
Dalia Marin (Project Syndicate) May 9, 2019
Although national industrial policies have a bad reputation, there is a strong case for government support to sectors that will increasingly rely on artificial intelligence. In this regard, the German government’s plan to promote production of electric-car batteries may accelerate an industrial renaissance in Europe.

The Case for Climate Tariffs
Shang-Jin Wei (Project Syndicate) May 9, 2019
Because the United States is the world’s biggest economy, most countries have to accommodate America’s trade demands in some way. In a similar vein, a future US government could use import tariffs, or the threat of them, to push other countries to reduce their carbon dioxide emissions more sharply.

More or Less Europe?
Kemal Dervis (Project Syndicate) May 9, 2019
The upcoming elections will entrench the growing divide between those who want less Europe and those who want more. And the fragmented parliament that is likely to emerge will cast further uncertainty on the European Union’s future direction.

How the Failure of “Prestige Markets” Fuels Populism
Ricardo Hausmann (Project Syndicate) May 9, 2019
Given the requirements of today’s technology, dismissing expertise as privilege is dangerous. That's why a well-functioning prestige market is essential to reconciling technological progress and the maintenance of a healthy polity.

Immigration in the aftermath of the eastern enlargement
Bernt Bratsberg, Andreas Moxnes, Oddbjørn Raaum and Karen-Helene Ulltveit-Moe (VoxEU) May 9, 2019
In the aftermath of the eastern enlargement of the EU, Norway experienced one of the largest immigration shocks of the 21st century. This column uses data from the episode to examine the general equilibrium response of wages, labour costs, and industry employment to such shocks. One finding is that although real wages in some occupations decline, the aggregate welfare effects on natives are close to zero as natives switch to higher-wage occupations. The welfare effect on the existing population of immigrants, on the other hand, is negative as they have a comparative advantage in low-wage occupations.

How stress tests fail
Jeremy Bulow (VoxEU) May 9, 2019
Bank stress tests in the US were an important tool for bailing out banks in the Great Recession. As this column points out, however, because the tests use regulatory rather than market measures of asset values and risk they have almost nothing to do with whether a bank will be economically solvent under test conditions. This column argues that the thousands of pages of post-crisis bank regulation have largely ignored perhaps the two most needed reforms: measuring asset values and risks in an economically realistic way. Reforming the stress tests is necessary for clearly and credibly placing responsibility for future banking losses in the private sector and for improving incentives for both managing old risks and for investing in new ones.

Venezuela’s Exile Economy
Afsin Yurdakul (FP) May 9, 2019
The crisis in Venezuela has drastically altered what goods are being traded on the border with Colombia—and who is benefiting.

No horse-trading for the ECB presidency, please
FT View May 10, 2019
EU leaders must pick the best-qualified figure to succeed Mario Draghi.

Technology is a bright spot for British economy
FT View May 10, 2019
Sector is the fastest growing since the EU referendum in 2016.

US business has changed its tune on China
Gillian Tett (FT) May 10, 2019
Many corporate executives now quietly support Donald Trump’s tough trade talk.

China overestimated Trump’s desperation to do a deal
Jamil Anderlini (FT) May 10, 2019
Beijing miscalculated the depth of frustration and anger in Washington.

EM currency falls bring big opportunities for investors
Paul McNamara (FT) May 10, 2019
Local-currency markets generate triple the average return in the year following a crisis.

Trump’s Tariffs Are a New Tax on Americans
NYT May 10, 2019
President Trump is undermining the credibility of his trade policies by falsely claiming that China is paying the bill.

The China Trade Impasse
WSJ May 10, 2019
The tariff damage rises as Beijing backtracks on its earlier concessions.

A new industry in Ethiopia is creating jobs. But at what cost?
Paul Barrett (WP) May 10, 2019
Western companies need to ensure that “Made in Ethiopia” won't be a mark on their reputations.

Ratings key to globalizing China's bond market
Richard Cook (AT) May 10, 2019
Chinese credit rating agency issues what it says is a milestone international rating for offshore US dollar bonds

With New Tariffs, Trump Hikes Taxes on American Small Business Owners — Again
Ryan McMaken (Mises Wire) May 10, 2019
Tariffs are just a tax increase on business owners who must now lay off workers or take pay cuts to deal with a government-imposed rise in the cost of doing business.

US-China Trade: It’s Politics, Stupid!
Tom Clifford (Globalist) May 10, 2019
A better safety net for Americans is the issue that should be addressed with at least as much vigor as tariffs on Chinese goods.

Be Smart About Venezuela’s Future
Bloomberg View May 10, 2019
Threats of force won’t help. Better diplomacy would.

The U.S. Is Crazy to Scare Skilled Immigrants Away
Noah Smith (Bloomberg View) May 10, 2019
Welcoming foreign talent is a win-win policy.

Can Europe Go On Managing Trump on Trade?
Leonid Bershidsky (Bloomberg View) May 10, 2019
Thanks to a complex game of give-and-take, the EU has managed to avoid punitive trade tariffs. But for how much longer?

The U.S. and China May Not Want a Deal After All
David Fickling (Bloomberg View) May 10, 2019
Keeping tensions bubbling could be politically expedient. That may be why both sides seem alarmingly comfortable with the deteriorating status quo.

There's Nowhere to Hide From Trump's Trade War
Stephen Gandel (Bloomberg View) May 10, 2019
All the obvious trade-war bets aren't likely to offer much protection.

Trump Says No Rush on Trade Talks. Really?
Brooke Sutherland and Sarah Halzack (Bloomberg View) May 10, 2019
Neither consumers nor manufacturers have endless capacity to absorb higher prices. These new tariffs will bring that into sharp relief.

The ECB Weighs a Profound Shift in Policy
Ferdinando Giugliano (Bloomberg View) May 10, 2019
As candidates jostle to replace Mario Draghi, Olli Rehn has called for a rethink of the bank’s objectives. A hard 2% inflation target would be a start.

This Is the Wrong Way to Deal With China
Andrew Browne (Bloomberg View) May 10, 2019
Beijing can be a slippery negotiating partner. But more tariffs aren’t the smartest means of applying pressure.

No U.S. Manufacturer Asked for More Tariffs
Brooke Sutherland (Bloomberg View) May 10, 2019
It’s unclear whether the economy is strong enough to weather escalated trade tensions. Plus more industrial insights.

The Real Victims of China’s Trade Patterns
Jayati Ghosh (Project Syndicate) May 10, 2019
Many in the West, especially US President Donald Trump, have railed against China’s massive trade surpluses, which emerged after the country’s accession to the World Trade Organization in December 2001. But China’s developing-country neighbors have far more reason to be worried.

Can the East Save the West?
Parag Khanna (Project Syndicate) May 10, 2019
Asia’s emergence as the world’s geopolitical and economic center has lent global prestige to a new paradigm for achieving sustainable growth alongside social solidarity. With many other countries already studying the Asian playbook, the United States and Europe could benefit from doing the same.

The US-China trade deal: An opportunity to reignite growth?
David Dollar (VoxDev) May 10, 2019
A new trade deal could open opportunities for foreign and domestic private firms if China is willing to open sectors and protect intellectual property.

Lending cycles and real outcomes: Costs of political misalignment
Çagatay Bircan and Orkun Saka (VoxEU) May 10, 2019
Government ownership of banks can help solve credit market failures and stabilise the supply of credit over the business cycle. However, it can also end up serving political interests and lead to a misallocation of financial resources. This column provides new evidence that state-owned banks systematically engage in tactical redistribution of credit in line with the political incentives of those in power. Analysing the geographical distribution of all lending and economic activity in Turkey, it shows that the central government may use commercial lending by state-owned banks to support allies in local elections.

Putting Growth in its Place
Jim O'Neill (Project Syndicate) May 10, 2019
Despite the political turmoil engulfing the United Kingdom, there is growing evidence to suggest that the "northern powerhouse" model of regional development outside of London is working. If the government fulfills its recent commitment to support a new Northern Powerhouse Rail project, current progress could gain even more momentum.

Using global demand calibrations to evaluate policy
Michael Kremer, Christopher Snyder and Fanele Mashwama (VoxEU) May 10, 2019
Consumers pay more for many pharmaceuticals in the US than in most other countries. This column investigates the welfare implications of such price discrimination using demand curves for HIV pharmaceuticals. A ban on price discrimination exacerbates the potentially large deadweight loss in the market for either a drug or a vaccine. However, this loss is ameliorated by a small government subsidy.

Bolstering Reform in Indonesia
Adam Schwarz (YaleGlobal) May 10, 2019
Reforms include increased investment in education, health and competitiveness.

Here’s What a Progressive China Strategy Would Look Like
Kelly Magsamen and Melanie Hart (FP) May 10, 2019
The United States should pursue a smarter long-term strategy that better positions the American people to compete and succeed in this century.

Tariff Rumor Turns to Tariff Fact
Erik Nelson and Brendan McKenna (WF) May 10, 2019
The United States moved ahead with an increase in tariffs on Chinese goods today. Risks are, unsurprisingly, to the downside for our current Chinese GDP forecast, although much will depend on how this fluid trade situation evolves as well as how Chinese policymakers respond.

Investors sweat as game of chicken over trade heats up
Michael Mackenzie (FT) May 11, 2019
Protectionism likely to remain a feature of investing landscape whatever happens.

Cyril Ramaphosa has won in South Africa. Now he must bite the hand that fed him.
Sisonke Msimang (WP) May 11, 2019
He will have to learn how transcend South Africa's wealth divide and lead for all citizens.

The US-China trading relationship will be fraught for years to come
Economist May 11, 2019
That matters more than trade deals today.

When you have options, volatility is your friend
Economist May 11, 2019
The jumpier prices are, the more valuable is a right to buy or sell.

Hong Kong Has a Haven From Trade-War Jolts
Ronald W Chan (Bloomberg View) May 11, 2019
Stocks focused on the Greater Bay Area may prove relatively immune to the volatility affecting the wider market.

The global economy hit by higher uncertainty
Hites Ahir, Nicholas Bloom and Davide Furceri (VoxEU) May 11, 2019
According to the latest IMF projections, the global economy is now projected to grow at 3.3% in 2019, down from 3.6% in 2018. This is partly due to rising uncertainty in many parts of the world. This column shows how these statements are in line with the latest reading of the World Uncertainty Index, which shows a sharp increase in the first quarter of 2019. The increase in uncertainty observed in the first quarter could be enough to knock up to 0.5% of global growth over the course of the year.

German governance must be fit for purpose
FT View May 12, 2019
Recent scandals have exposed shortcomings in the corporate model.

Fed grapples with low inflation and trade wars
Gavyn Davies (FT) May 12, 2019
Markets expect rates to be cut but the FOMC may not agree.

Changing the German growth model will not be easy
Wolfgang Münchau (FT) May 12, 2019
The world champion of the analogue age is struggling with digitalisation.

Stockport offers towns a blueprint for revival
Jim O'Neill (FT) May 12, 2019
The area is tackling the problems that beset declining places close to big cities.

Federal Reserve rethink faces a credibility challenge
Megan Greene (FT) May 12, 2019
Proposals rest on convincing markets that the central bank can generate inflation.

The Brexit effect: private equity firms shun UK for Europe
Javier Espinoza (FT) May 12, 2019
Confusion over the means and timing of the UK’s withdrawal from the EU is raising questions about the value of deals.

America’s Abusive Trade Practices
James Bacchus (WSJ) May 10, 2019
China has legitimate grievances, too. The WTO often looks askance at U.S. antidumping tariffs.

Engaging Asia after Australia’s election
James Curran (EAF) May 12, 2019
The challenge of how Australia's next government will engage with Asia, and how it will pursue security and prosperity in a more turbulent strategic environment.

India Hoped for an Abe. It Got a Lost Decade
Andy Mukherjee (Bloomberg View) May 12, 2019
Narendra Modi’s five-year term wasn’t supposed to end with families cutting back on biscuits and toothpaste.

The growing trade war between the US and China
FT View May 13, 2019
There is still time for Trump and Xi to pull back from the brink.

How Mifid II hurts European investment banking
Andrea Vismara (FT) May 13, 2019
The EU’s financial rules are an act of regulatory self-harm.

Fears of QE-forever cycle turns spotlight on hedging
Amin Rajan (FT) May 13, 2019
This sugar-high circularity is great when markets are buoyant but painful when they reverse.

America is the revisionist power on trade
Gideon Rachman (FT) May 13, 2019
Meanwhile China wants to preserve the model of globalisation that has served it well.

Xi’s China: why entrepreneurs feel like second-class citizens
Tom Hancock (FT) May 13, 2019
Strong support for state-owned companies is weighing down on the dynamic private sector.

The Cost of China Tariffs
WSJ May 13, 2019
Border taxes are an economic loss, as markets are saying.

Democrats should be shouting Trump’s trade failures from the rooftops
Catherine Rampell (WP) May 13, 2019
Democratic voters understand that using tariffs doesn’t pay. Why don’t the people seeking their vote get it?

Tariffs on Mexican Fruits and Vegetables Would Leave Consumers Hanging
Gary Clyde Hufbauer and Euijin Jung (PIIE) May 13, 2019
President Trump’s drive to raise tariffs on imports has shifted money from the pockets of consumers to the profits of producers in the manufacturing sector—notably steel, aluminum, and autos.

Germany’s even larger than expected fiscal surpluses: Is there a link with the constitutional debt brake?
Catarina Midoes and Guntram B. Wolff (Bruegel) May 13, 2019
Germany is having a political debate on the adjustment of its budgetary plans due to revised forecasts, and an academic debate on the debt brake. Yet, since 2011, general government revenues and surpluses have been systematically and significantly higher than forecast. The German surplus reached 1.7% of GDP in 2018. This bias did not exist from 1999-2008 before the introduction of the debt brake. While the IMF also got its forecasts of German surpluses wrong, the extent of the bias is larger for the German government’s forecasts. These data suggest that the political debate should focus on the debt brake and its implementation rather than on how to close the budgetary ‘hole’.

Will China’s trade war with the US end like that of Japan in the 1980s?
Alicia García-Herrero and Kohei Iwahara (Bruegel/Latin Trade) May 13, 2019
The outcome of the US-China trade war is anticipated to be quite different from the experience of Japan in the 1980s and 1990s, due to China’s relatively lower dependence on the US and having learned from the Japanese experience.

U.S. Core CPI Inflation: Firming Rents, Weaker Core Goods Underlie Soft April Reading
Tiffany Wilding (PIMCO) May 13, 2019
Shelter inflation, which tends to be influenced by the business cycle – and is therefore a focus for the Fed – was again firm.

China Loses More From This Trade War
Tyler Cowen (Bloomberg View) May 13, 2019
It is vulnerable because it is a much poorer country with more fragile political institutions.

Ground Zero for the U.S.-China Rivalry
Daniel Moss (Bloomberg View) May 13, 2019
Beijing’s footprint is expanding in countries like the Philippines, regardless of the trade impasse. But America has a bulwark in the greenback.

The Fed Can Avoid Pitfalls of an Average-Inflation Target
Ramesh Ponnuru (Bloomberg View) May 13, 2019
The drawbacks of a change in monetary policy can be checked by keeping spending growth steady.

China’s Junk Property Bonds Are Safer Than They Look
Shuli Ren (Bloomberg View) May 13, 2019
Surging defaults are less of a risk than the stretched valuations of Asia’s investment-grade dollar debt.

Corporate Bottom Lines Can’t Escape Trade War Pain
Stephen Gandel (Bloomberg View) May 13, 2019
The real problem is not what tariffs will do to sales but to earnings.

If China Sells Its U.S. Bonds, Trump Will Benefit
Karl W Smith (Bloomberg View) May 13, 2019
A selloff would result in a weaker dollar, which would help reduce the U.S. trade deficit with China.

The Grim Logic of Trump’s Trade War With China
Noah Smith (Bloomberg View) May 13, 2019
Maximizing American prosperity probably isn’t the goal.

Setting the Record Straight About African Migration
Folashadé Soulé Camilla Toulmin (Project Syndicate) May 13, 2019
Cynical politicians in Europe and the United States claim, for the sake of winning votes, that immigrants are “invading” their countries, threatening to steal locals’ jobs, or worse. When it comes to Africa, nothing could be further from the truth, because, contrary to widespread belief, no mass exodus is occurring.

The Return of Fiscal Policy
Barry Eichengreen (Project Syndicate) May 13, 2019
Public debt is not a free lunch in an economy close to full employment. But when investment demand tends to fall short of saving, as it does when monetary policymakers are unable to push inflation higher to reduce real interest rates, there is a risk of chronic underemployment – and a stronger argument for deficit spending.

The ECB Song Contest?
Stefan Gerlach (Project Syndicate) May 13, 2019
Choosing the next president of the European Central Bank should not be like picking the winner of the Eurovision Song Contest. Instead, Europe should ask which criteria candidates must satisfy to be an effective ECB president, and then search for the person who best meets them.

Dirty Floating in Emerging Markets
Andrés Velasco (Project Syndicate) May 13, 2019
Central banks are supposed to use the interest rate to achieve an inflation target and let the exchange rate float freely. So why do they often intervene in currency markets by buying and selling international reserves, and use a host of other measures to limit their currencies’ volatility?

The links between capabilities and export dynamics in developing countries
Sebastian Vergara (VoxDev) May 15, 2019
Economic complexity and R&D investment influence the number, size, product quality, and diversification of exporters, making them policy priorities.

How to design a stimulus package
Pascal Michaillat and Emmanuel Saez (VoxEU) May 13, 2019
Academics and policymakers alike have debated how to structure an optimal stimulus package since the Great Recession. This column revisits the arguments related to the size of the multiplier and the usefulness of public spending, and offers a blueprint for future stimulus packages. It finds that the relationship between the multiplier and stimulus spending is hump-shaped, and that a well-designed stimulus package should depend on the usefulness of public expenditure. The output multiplier is not a robust statistic to use, and instead the ‘unemployment multiplier’ should be used.

The Risk of Returning to the Zero Lower Bound
Jens H.E. Christensen (FRBSF Econ Letter) May 13, 2019
Following the global financial crisis, U.S. monetary policy was constrained by the zero lower bound for short-term interest rates for many years. It has since lifted off and rates have gradually climbed. However, in light of the continuing economic expansion, it is relevant to ask how likely it is for the lower bound on interest rates to again become a constraint on monetary policy. Analysis using several different approaches suggests that there currently appears to be a low risk of the economy returning to the zero lower bound for at least the next several years.

GDP Growth Outlook: Trade War Skews Risks to Downside
Jay H. Bryson (WF) May 13, 2019
We maintain the forecast that we released on May 8. However, we acknowledge that the recent escalation of the U.S.-China trade war skews the risks to our GDP forecast to the downside.

India’s fragile economy threatens second Modi term
Simon Mundy (FT) May 14, 2019
Investors did well out of prime minister’s first 5 years but the outlook is murky.

Investors wrongfooted by downturn at emerging Asia
Jonathan Wheatley (FT) May 14, 2019
Some analysts expect the headwinds facing the region to last for some time.

Inequality in America has lessons for Britain
Angus Deaton (FT) May 14, 2019
Stagnant wages, globalisation and automation are aggravating already deep disparities.

How foreign groups fare in China’s slowing two-track economy
Gabriel Wildau and David Blood (FT) May 14, 2019
Data show some multinationals buck trend as angst mounts for others and job security fears grow.

In China, Some Fear the End of ‘Chimerica’
Li Yuan (NYT) May 14, 2019
As the trade war with the U.S. threatens to decouple the world’s two largest economies, some in China argue that the two sides benefit from the relationship more than they admit.

A Better Way to Deal With Beijing
Robert B. Zoellick (WSJ) May 14, 2019
Pressure the Chinese to act responsibly. Don’t settle for a trade deal or blunder into a cold war.

Forget the infrastructure spending spree
Beth Osborne (WP) May 14, 2019
Throwing money at the problem won't fix it. We need structural reform.

There’s a revealing puzzle in the China tariffs
Lawrence Summers (WP) May 14, 2019
Tariffs alone don’t explain the volatility in stocks.

Stablecoins, Central Bank Digital Currencies, and Cross-Border Payments: A New Look at the International Monetary System
Tobias Adrian (IMF) May 14, 2019
I will define eMoney, then discuss its implications in a closed-economy setting. I will suggest that its adoption may be extremely rapid — but that it may raise significant risks. Policies to counter these risks — as in a sleight-of-hand magic trick, you will see — yield a synthetic version of central bank digital currency (CBDC) with various advantages relative to the full-service version.

Washington plays Monopoly, Beijing plays Go
David Goldman (AT) May 14, 2019
China’s emerging high-tech giants don’t rely on the US market, creating an opening to undermine American leadership in key industries.

Clash of civilizations and the China conundrum
Gordon Watts (AT) May 14, 2019
Even if Washington and Beijing cut a deal, the wounds will fester and reopen.

Between Trade Wars and Trade Slowdowns, What’s on the Horizon for Asian Economies?
Alexis Garatti (Brink) May 14, 2019
President Donald Trump’s latest round of tariffs against China has created concerns about a possible trade war and economic slowdown among the Asian economies.

The Pivot in U.S.-China Trade Policy May Herald Long-Term Tension
Libby Cantrill and Tiffany Wilding (PIMCO) May 14, 2019
With the U.S. and China raising tariffs on each other’s goods, we may be entering a prolonged period of trade tension.

Trump's 2019 Protection Could Push China Back to Smoot-Hawley Tariff Levels
Chad P. Bown and Eva (Yiwen) Zhang (PIIE) May 14, 2019
Following the failure of their trade negotiations on May 9, the United States and China have escalated the trade war initiated by President Trump. In the first phase of the war, during 2018, the United States imposed tariffs on $250 billion of Chinese exports. China immediately retaliated with tariffs on $110 billion of US exports. Then, when talks hit a snag this month, Trump abruptly increased the tariffs imposed last September on $200 billion of Chinese imports from 10 percent to 25 percent.

China May Have Miscalculated Trump’s Weak Spot
John Authers (Bloomberg View) May 14, 2019
By raising tariffs, the White House puts pressure on China to stimulate its economy, which will lead to a recovery in U.S. share prices.

Want to Take on China? You’re Going to Need Some Help
David Fickling (Bloomberg View) May 14, 2019
The U.S. can't sway such a large country without allies, as the breakdown in trade talks and the Nafta experience show.

Why the US and China See Negotiations Differently
Shang-Jin Wei (Project Syndicate) May 14, 2019
The recent breakdown in trade talks between the United States and China may in part reflect the two countries’ different approaches to negotiation. Hopefully, this contrast in styles will not cause the talks to fail unnecessarily, given the importance to the global economy of a US-China agreement.

America’s Illusions of Growth
Jeffrey D. Sachs (Project Syndicate) May 14, 2019
Many commentators have interpreted buoyant GDP and unemployment data in the United States as vindicating President Donald Trump’s economic policies, and some suggest that his re-election chances have improved as a result. But these indicators fail to measure what really counts for the public.

Is Trump’s Trade War with China a Civilizational Conflict?
Minxin Pei (Project Syndicate) May 14, 2019
Recent remarks by a senior Trump administration official suggest that the United States' current approach to China is dangerously misconceived. The rise of China under a one-party dictatorship should be met with a united front in defense of the liberal order, not talk of a clash of Caucasian and non-Caucasian civilizations.

Democratic Lessons from the EU
Maciej Kisilowski and Wojciech Przybylski (Project Syndicate) May 14, 2019
Highly centralized political systems in Poland and other countries create a pernicious winner-take-all dynamic and polarize debate. The European Union's governance system, by contrast, offers an appealing practical model for more decentralized democratic decision-making.

Speculation and the price of virtual currency
Wilko Bolt and Maarten R C van Oordt (VoxEU) May 14, 2019
What drives the volatility of Bitcoin? This column explains a theoretical framework to link exchange rates to currency creation, speculative behaviour, and real growth in goods and services transactions. It suggests that the exchange rate will be less sensitive to speculators' beliefs when a virtual currency becomes more established as a means of payment.

The sound of many funds rebalancing
Alex Chinco and Vyacheslav Fos (VoxEU) May 14, 2019
Noise makes financial markets possible. The column investigates an overlooked source of noise, namely, that in modern markets it is computationally infeasible to predict how even simple, rational trading rules interact to create net demand for a stock. For example, empirical data suggest that we can predict whether a stock will be affected by an exchange-traded fund portfolio rebalancing cascade, but not how.

A Trade Love Triangle
Xueying Zhang (YaleGlobal) May 14, 2019
Increasing US antagonism on trade pushes other nations closer to China

Is Sri Lanka Really a Victim of China’s ‘Debt Trap’?
Umesh Moramudali (Diplomat) May 14, 2019
Sri Lanka’s debt crisis and Chinese loans – separating myth from reality.

The Stock Market Intrudes on Trump’s Trade War
John Cassidy (New Yorker) May 14, 2019
Nearly all economists, including some who work for Trump, believe that tariffs are costly to the economy, and that American consumers will bear at least some of the burden they impose.

The IMF should enforce strict targets in Pakistan
FT View May 15, 2019
Transparency is needed on loans from China, UAE and Saudi Arabia.

India needs to unlock its natural resource potential
Anil Agarwal (FT) May 15, 2019
Mining industry could grow to 10% of GDP if country develops its own deposits.

Ignore ‘tariff terror’ — political gridlock is good for investors
Ken Fisher (FT) May 15, 2019
Fears of a US-China trade war are overdone.

The $119tn question: how do we get China to save for retirement?
Wina Appleton (FT) May 16, 2019
Asian people are living up to 20 years longer so simply hoarding cash will not do.

How the long debt cycle might end
Martin Wolf (FT) May 15, 2019
Some fear the fire of inflation; others the ice of deflation.

How much more can Argentina adjust?
Colby Smith (FT) May 15, 2019
The battle between politics and capital markets looks set to intensify.

The Global Economy Was Improving. Then the Fighting Resumed.
Peter S. Goodman (NYT) May 15, 2019
The escalating trade war between the United States and China is threatening the global economy.

Is the United States losing the trade war with China?
Robert J. Samuelson (WP) May 15, 2019
Trade negotiations have apparently made little headway in resolving the issues between the U.S. and China.

To win the trade war, Trump needs help from a group he’s on rocky terms with
Henry Olsen (WP) May 15, 2019
Trump needs to pick and choose his battles. If he wants to win in the trade dispute against China, he'll need allies.

US stocks are exposed to trade war, Chinese stocks aren’t
David Goldman (AT) May 15, 2019
In the worst-case scenario, China’s most-widely traded companies would fare far better than their US counterparts

The Financial Burden of Retirement Is a Global Problem—but Asia is Uniquely Vulnerable
David Anderson (Brink) May 15, 2019
Much of the world is facing challenges relating to aging populations. Asia, in particular, is experiencing seismic demographic changes, with rapidly aging populations and declining birthrates. But investment returns in the region are relatively low due to geopolitical uncertainty and minimal interest rates.

Why the World Needs National Development Banks
Stephany Griffith-Jones and José Antonio Ocampo (Project Syndicate) May 15, 2019
By counteracting major shortcomings of the private financial sector, national and multilateral development banks play a crucial role in supporting economic growth. Countries that already have national development banks should aim to expand their role, while others should consider establishing them.

The Demand for Reverse Mortgages in China
Katja Hanewald, Hazel Bateman, Hanming Fang and Shang Wu (VoxChina) May 15, 2019
Reverse mortgages are financial products that allow older homeowners to live in their property and receive income for as long as they live; repayment is made from the proceeds of the property sales upon the homeowners’ death. A recent pilot program in China by Happy Life Insurance found almost no takeup of such products. We investigate whether, if reverse mortgates were properly designed and explained, there would be a demand for them in China. We provide evidence on the demand for reverse mortgages in urban China based on two large online surveys. We find that 89% of older Chinese homeowners aged 45–69 years are interested in reverse mortgages, and 84% of adult children aged 20–49 years would recommend reverse mortgages to their parents. We test an improved product design that overcomes the shortcomings of the unsuccessful reverse mortgage product piloted in China by Happy Life Insurance. Our results can inform the development of China’s reverse mortgage market

The world is in danger of blowing its sand budget
Anjana Ahuja (FT) May 16, 2019
There are grave environmental consequences from the plundering of lakes, rivers and coastal areas.

Investors need to focus on China’s grinding gears
Henny Sender (FT) May 16, 2019
Slowing growth in jobs and wages comes as household debt is increasing dramatically.

Trade is an opening shot in a wider US-China conflict
Philip Stephens (FT) May 16, 2019
The current standoff is part of a struggle for global pre-eminence.

The dollar will dominate for a while yet
Gillian Tett (FT) May 16, 2019
And when a challenge to its supremacy comes, it might be from an unexpected quarter.

How to Prepare for the Next Recession: Automate the Rescue Plan
Neil Irwin (NYT) May 16, 2019
Deciding in advance how the government fights downturns could make them less severe and avoid political gridlock.

China’s yuan slide risks trolling Trump
William Pesek (AT) May 16, 2019
There’s no telling how an easily angered and thin-skinned American president might respond

A new kind of cold war
Economist May 16, 2019
How to manage the growing rivalry between America and a rising China.

How can Vietnam avoid the middle-income trap?
Sebastian Eckardt and Vu Viet Ngoan (Brookings) May 16, 2019
In order to become a high-income country by 2045, Vietnam will need to sustain average growth rates of at least 7 percent over the next 25 years—this would bring GDP per capita to about $25,000. While Vietnam has the potential to meet this aspiration, without reforms, the country is likely to experience a slowdown in growth and fall short of its own aspiration.

Finding a Path to the Higher Plain of Inclusive Growth
Christine Lagarde (IMF) May 16, 2019
Throughout the Caucasus and Central Asia (CCA), growth has picked up since 2014 and is now expected to remain at 4.1 percent this year and in 2020. However, this number is still well below the long-term potential for the region — and it is too low if the region is to raise living standards to the level of other emerging economies in Europe and Asia.

China Could Pay a High Price for Trump’s Tariffs
Mohamed Aly El-Erian (Bloomberg View) May 16, 2019
If the country falls back on bad habits, its chances of reaching high-income status may well be threatened.

Don’t Drag India Into This Trade War
Atman M Trivedi (Bloomberg View) May 16, 2019
The Trump administration is endangering one of the rare bipartisan bright spots in U.S. foreign policy with yet more tariff threats.

Is America Tired of Losing Yet?
Anne O. Krueger (Project Syndicate) May 16, 2019
In the two years since US President Donald Trump abandoned the Trans-Pacific Partnership, Japan and the other TPP signatories have forged ahead with new trade deals. As a result, US exporters are increasingly feeling the pinch – and probably wondering what happened to "the art of the deal."

Modern Monetary Disasters
Sebastián Edwards (Project Syndicate) May 16, 2019
The experience of Latin America should serve as a clear warning for today’s Modern Monetary Theory enthusiasts. In a variety of countries, and at different times, fiscal expansions that were financed by printing money spun catastrophically out of control.

How the structural transformation triggered the fertility transition
Philipp Ager and Benedikt Herz (VoxEU) May 16, 2019
The transition from high to low fertility rates is regarded as one of the most important determinants of sustainable long-run growth. But despite its importance, there is still an ongoing debate about its causes and timing. This column demonstrates that a sustained shift from agriculture to manufacturing contributed to the fertility decline in the American South at the turn of the 20th century.

Malaysia Demands Belt and Road Transparency
Frank Ching (YaleGlobal) May 16, 2019
Asian fret about debt associated with BRI projects.

Is Inflation Really as Low as the Fed Fears?
Sarah House and Shannon Seery (WF) May 16, 2019
Fed officials have been concerned about inflation's ongoing shortfall from the FOMC's 2% target. Core PCE inflation has averaged only 1.6% over the current expansion, and has weakened more recently. The undershoot and handwringing over the miss come as a surprise to many of the clients to whom we speak, who feel their own costs have been rising more rapidly.

Decoding the fickle trade policy of Donald Trump
FT View May 17, 2019
Investors need to accept that US actions do not follow simple rules.

Why China will not dump US Treasuries in retaliation
Michael Mackenzie (FT) May 17, 2019
Ditching debt would unleash financial instability in Washington but likely backfire on Beijing.

Why lack of competition is rubbish for investors
Merryn Somerset Webb (FT) May 17, 2019
Concentration of power in a few superstar firms reduces investment and productivity too.

Mifid II critics are not seeing the big picture
Karel Lannoo (FT) May 17, 2019
Early data on its effects show market opening and integration are continuing apace.

‘Global Britain’ is an illusion as distance has not died
Martin Wolf (FT) May 17, 2019
Trade often occurs within supply chains, where reliability and control is vital.

A Metals Tariff Reprieve
WSJ May 17, 2019
Good news for steel consumers, but border taxes could be reimposed.

Trump’s Trade War With China Is Taxing Missouri Farmers
Blake Hurst (WSJ) May 17, 2019
My patriotic friends and neighbors support the president, but they’ve given about all they can.

Congratulations, Mr. President. You didn’t make trade worse this week.
WP May 17, 2019
There was progress on two fronts — if you consider progress to mean avoiding retreat from equitable access to global markets.

Did China Break the World Economic Order?
Yukon Huang (CEIP) May 17, 2019
The U.S.-China trade war isn’t really about trade—it’s about technology. Beijing is forcing the transfer of foreign technology to domestic companies to fuel Chinese growth. But Washington’s harsh response could pose a greater threat to the global financial system.

Italy Is the Canary in Europe’s Coalmine
Marcus Ashworth (Bloomberg View) May 17, 2019
Rome’s problems are self-inflicted but Europe’s central bank should still offer a hand. Not to do so might mean turning a slowdown into something worse.

There’s Still Hope on China Trade, But Trump Is Selling It All Wrong
Ramesh Ponnuru (Bloomberg View) May 17, 2019
This trade war is not going to bring back Rust Belt manufacturing jobs, but it might protect intellectual property.

A Greek Canary in a Global Goldmine
Yanis Varoufakis (Project Syndicate) May 17, 2019
After 2008, Greece came to symbolize global capitalism’s failure to balance credit and trade flows. Today, as the global mismatch between economic reality and financial returns grows, there is clear danger that, once again, the country is foreshadowing a new phase of the global crisis.

China's Hunger for Electric Vehicles Is Driving Manufacturing
Nathaniel Bullard (Bloomberg View) May 17, 2019
Some of the world’s biggest automakers are about to invest billions of dollars to produce cleaner-running cars.

Multiple Trade Battles Will Keep Markets Under Pressure
Komal S Sri-Kumar (Bloomberg View) May 17, 2019
Bonds are signaling that tensions will only escalate as the U.S. deals with China, the EU, Japan, Mexico and China.

Globalisation and state capitalism
Leonardo Baccini, Giammario Impullitti and Edmund Malesky (VoxEU) May 17, 2019
The recent success of China and Vietnam over the past three decades has triggered a debate over ‘state capitalism’ as a viable growth and development model. This column studies the effect of the 2007 WTO accession on the productivity, profitability, and survival rates of state-owned and private Vietnamese firms. The findings reveal that state-owned enterprises have hampered the efficiency gains brought about by globalisation. An analysis suggests that productivity gains from trade five years after WTO entry might have been 66% higher in the absence of state-owned firms.

For the Poor, Falling Poverty Numbers Aren’t Always Good News
Zuhumnan Dapel (FP) May 17, 2019
Although the numbers reflect a decline in chronic poverty, the percentage of the world population that has never experienced poverty has also declined.

To China, All's Fair in Love and Trade Wars
Michael Schuman (Atlantic) May 18, 2019
China has more leverage in its trade war with the U.S. than you think.

Brexit wrangles intrude on EU job allocation
Wolfgang Münchau (FT) May 19, 2019
Victory for Nigel Farage in the European elections could complicate appointments.

Abe contemplates a last throw of the economic dice
Gavyn Davies (FT) May 19, 2019
With growth weak, Japan’s prime minister weighs a double election and fiscal stimulus.

I Wanted Ronald Reagan. India Kept Electing Bernie Sanders.
Ruchir Sharma (NYT) May 19, 2019
Government programs, not economic freedom, are what win elections in my home country.

Mexico Flirts With Suicide
Mary Anastasia O’Grady (WSJ) May 19, 2019
An architect of the Argentine economic debacle gives advice to the government.

Long-term and intergenerational effects of education
Richard Akresh, Daniel Halim and Marieke Kleemans (VoxEU) May 18, 2019
Does investment in schools promote higher educational attainment—and do the effects improve students’ later lives and those of the next generation? This column examines the impact of over 61,000 primary schools built by the Indonesian government between 1973 and 1979, almost doubling the number in the country. The evidence shows that the men and women who accessed education provided by the construction programme benefited from significant improvements in their educational and later life outcomes. So too did their children.

Promises to repay and sovereign spreads
Mitu Gulati, Ugo Panizza, Mark Weidemaier and Grace Willingham (VoxEU) May 18, 2019
One way for a government to reassure investors of its willingness to repay is to give them a priority claim to state assets. It remains to be seen, however, whether such commitments are viewed as credible by market participants. This column investigates how markets responded to two such commitments. A commitment by the government of Spain did not affect yield spreads, while one by the government of Puerto Rico did. This may be because, as a sub sovereign, Puerto Rico faced higher constraints on its ability to renege.

What comes next in the US–China trade war?
Author: Stephen Roach (EAF) May 19, 2019
While it's likely that a deal will be struck on or before the G20 summit, any such agreement is likely to be superficial and offer little or no fundamental resolution to the deep-rooted conflict between the world's two great powers.

China Doesn’t Want to Be Like the West
Michael Schuman (Bloomberg View) May 19, 2019
The Trump administration has underestimated the strength of resistance to a foreign order imposed by force.

India’s Money Engine Is Broken
Andy Mukherjee (Bloomberg View) May 19, 2019
A $55 billion funding market is drying up and threatening a chain reaction. The next prime minister must fix it, and quickly.

The new globalisation and income inequality
Sergi Basco and Martí Mestieri (VoxEU) May 19, 2019
Trade in intermediates (or ‘unbundling of production') and trade in capital have become increasingly important in last 25 years. This column shows that trade in intermediates generates a reallocation of capital across countries that exacerbates world inequality in both income and welfare. Unbundling of production hurts middle-income countries but helps those with high productivity. Trade in intermediates also increases within-country inequality, and this increase is U-shaped in the aggregate productivity level of the country.

Attract the talent so tech can thrive in Greece
Aristos Doxiadis (FT) May 20, 2019
Like shipping, the country’s technology sector could flourish in a global market with the right people.

Xi Jinping is preparing China for a long trade war
Tom Mitchell (FT) May 20, 2019
Chinese president’s state apparatus could help him to outlast Trump.

The abandoned farms behind the global coffee craze
Emiko Terazono, Jude Webber and Andres Schipani (FT) May 20, 2019
Amid record crops and rising prices for consumers, some growers are unable to cover their costs.

As Huawei Loses Google, the U.S.-China Tech Cold War Gets Its Iron Curtain
Li Yuan (NYT) May 20, 2019
The White House’s hard-line approach threatens to speed up the development of two technology worlds, further isolating one-fifth of internet users.

Huawei Is an Asset, Not a Threat
George Gilder (WSJ) May 20, 2019
Ren Zhengfei’s company should be celebrated as a triumph of the U.S.-led global trading system.

On Trade, Where Are My Fellow Democrats
Don Bonker (WSJ) May 20, 2019
They should oppose Trump’s destructive tariffs and support U.S. exporters,

5 New Findings in Global Education
David Evans (CGD) May 20, 2019
Every day I see a consistent flow of new research and analysis in global education. Sometimes it feels like a deluge! There are some policy areas where we already have a great deal of research, but in other cases, one or two studies from a couple of countries drive our knowledge, and new evidence can make a big difference to our understanding. Here are five recent findings that I came across this week that struck me.

The latest European growth-rate estimates
Konstantinos Efstathiou (Bruegel) May 20, 2019
The quarterly growth rate of the euro area in Q1 2018 was 0.4% (1.5% annualized), considerably higher than the low growth rates of the previous two quarters. This blog reviews the reaction to the release of these numbers and the discussion they have triggered about the euro area’s economic challenges.

Brexit: From Bad to Terminal?
Jacob Funk Kirkegaard (PIIE) May , 2019
The cross-party talks between Labour and the Conservatives, aimed at a “soft” exit by Britain from the European Union, have collapsed—abandoned by Labour leader Jeremy Corbyn. His move was precipitated by Prime Minister Theresa May’s imminent departure from office.

Trade weakness to extend into second quarter, WTO indicator suggests
WTO May 20, 2019
World trade growth is likely to remain weak into the second quarter of 2019 according to the WTO’s latest World Trade Outlook Indicator (WTOI), released on 20 May. The new WTOI reading is 96.3, exactly as it was in the previous release in February this year, maintaining the weakest level since 2010.

Tariffs Are Attacks on Property Rights and Freedom
Per Bylund (Mises Wire) May 20, 2019
Tariffs inflict harm on real people, empowering bureaucracy and the state, while destroying the rights of real-world entrepreneurs and consumers. Yet, some people claiming to support free markets are perfectly fine with this.

The Populist Threat to Europe’s Future
Bloomberg View May 20, 2019
To counter the movement’s appeal, pro-European forces need to give voters a better alternative.

A Second Modi Term Needs to Be Bolder Than First
Mihir Sharma (Bloomberg View) May 20, 2019
Victory wouldn’t solve all the economic problems India’s prime minister has thus far left unresolved.

Japan Inc. Is Doing Better Than People Realize
Anjani Trivedi (Bloomberg View) May 20, 2019
Machine orders and spending plans at manufacturers such as Nidec were already pointing to strength.

A Gucci Bubble Gets Pricked by the Trade War
Andrea Felsted (Bloomberg View) May 20, 2019
The next phase of the U.S.-China trade spat could be the last shout for luxury labels.

You’re Big, Germany. Now Act Like It.
Melvyn Krauss (Bloomberg View) May 20, 2019
The German devotion to budget surpluses hurts European partners and betrays a small-country mentality.

Options Market Suggests China Has Edge in Trade War
Myron S Scholes and Ashwin Alankar (Bloomberg View) May 20, 2019
Recent changes in prices suggest traders believe Trump may have picked a trade fight he has a diminishing chance of winning.

Bank Stress Tests Are Getting Less Stressful
Mark Whitehouse (Bloomberg View) May 20, 2019
Vigilance seems to be fading along with memories of the 2008 crisis.

Imports Are Good, Mr. President
Noah Smith (Bloomberg View) May 20, 2019
Stuff made overseas isn't the drag on growth Trump thinks.

The Global Consequences of a Sino-American Cold War
Nouriel Roubini (Project Syndicate) May 20, 2019
What started as a trade war between the United States and China is quickly escalating into a death match for global economic, technological, and military dominance. If the two countries' leaders cannot manage the defining relationship of the twenty-first century responsibly, the entire world will bear the costs of their failure.

Europe’s Only Decision
Carl Bildt (Project Syndicate) May 20, 2019
After months of polling, speculation, and hand-wringing over the European Parliament election this month, one might think that nothing else matters. But there is a far more important question than who will lead the European Union for the next five years: What is the overarching strategic agenda that will guide their decisions?

Cross-border banking supervision for Central, Eastern and South Eastern Europe
Ismael Ahmad Fontán, Thorsten Beck, Katia D'Hulster, Pamela Lintner and Filiz Unsal (VoxEU) May 20, 2019
The banking systems in Central, Eastern, and South Eastern Europe are dominated by subsidiaries of multinational banks, many with parent banks from the EU. This column analyses the effects of regulatory and supervisory changes within the EU and euro area on host regulation and supervision in these countries and on their cooperation with home supervisors and resolution authorities in Western Europe. It also offers some recommendations for authorities both at the EU level and in the small host countries.

International evidence for Keynesian economics without the Phillips curve
Roger Farmer and Giovanni Nicolo (VoxEU) May 20, 2019
The economies of many countries are operating close to full capacity, but unemployment and inflation are both low. Using data from the US, UK and Canada, this column compares differences in the macroeconomic behaviour of real GDP, the inflation rate and the yields on three-month Treasury securities in the three countries. It shows that the Farmer monetary model, closed with a belief function, outperforms the New Keynesian model, closed with the New Keynesian Phillips curve. The data fit the multiple equilibria emphasised in the Farmer model well, rather than the mean-reverting processes assumed by the New Keynesian model.

The US is seeking to constrain China’s rise
FT View May 21, 2019
Ban on companies supplying Huawei is damaging and ill-conceived.

The US-China conflict challenges the world
Martin Wolf (FT) May 21, 2019
Smaller countries should band together to sustain multilateral free trade.

The Belt and Road Initiative lacks ‘Chinese characteristics’
Harry Broadman (FT) May 21, 2019
Buy-in from China’s partners rather than domination of them is the key to success.

Draghi’s legacy is consensus on ECB’s ways
Martin Sandbu (FT) May 21, 2019
Flipside is scepticism of Bundesbank’s Jens Weidmann as next president.

Lawyers should not rewrite crisis communications
Michael Skapinker (FT) May 21, 2019
A desire to ensure companies do not admit legal liability can cause serious damage.

India election: Narendra Modi’s incomplete project
Amy Kazmin and Lionel Barber (FT) May 21, 2019
The premier won power on a promise to unlock India’s potential. But if he wins a second term, he must arrest a slowdown in the rate of growth.

China Risks Hong Kong’s Economic Freedom
Terry Miller (WSJ) May 21, 2019
An extradition bill would weaken the territory’s already shaky rule of law.

Why capturing Huawei is no victory in tech war
Pepe Escobar (AT) May 21, 2019
Chinese firm is a queen on tech chessboard, but Beijing will just tell its whiz-kids to reach the next level.

Korea's Economic Outlook in Six Charts
IMF May 21, 2019
With strong fundamentals, Korea’s economy has performed well in recent years, but short-term growth is now moderating, and long-term growth is facing headwinds. Fiscal and monetary policies should boost growth, and structural policies should foster inclusion and enhance productivity, according to the IMF’s latest assessment of the Korean economy.

Designing Labor Market Institutions in Emerging Market and Developing Economies
David Lipton (IMF) May 21, 2019
In emerging market and developing countries, the challenge is to take into account the prevalence of the informal economy and weak government administrative capacity. There is a risk that poorly designed labor market institutions can increase informality and weaken worker protections.

Bad times bring back bad ideas
Brian Caplen (Banker) May 21, 2019
Printing money and running up massive government debts will not solve the current economic malaise.

China Has a Big Currency Decision to Make
John Authers (Bloomberg View) May 21, 2019
Allowing the yuan to weaken beyond seven per dollar could mark a huge shift in the international terms of trade. Also, actively responding to passive aggression.

China Has a Rare Chance to Strike Back on Huawei
David Fickling (Bloomberg View) May 21, 2019
The country’s dominance of raw materials can be a tool to sow disruption.

Indonesia Is Turning Chinese
Shuli Ren (Bloomberg View) May 21, 2019
The country needs better infrastructure, but it's adopted a dangerous financing model.

What Salvini and Le Pen Get Wrong About Europe
Lionel Laurent (Bloomberg View) May 21, 2019
Brussels isn’t totally in thrall to elite interests. Its initiatives on corporate tax avoidance, tech regulation, and climate change all have the popular touch.

U.S.-China Trade Clash Has Now Gone Global
Mohamed Aly El-Erian (Bloomberg View) May 21, 2019
Trump’s effort to isolate the Chinese manufacturer Huawei gives pause to businesses and consumers around the world.

Deutsche Bank Makes the Wrong Kind of Enemy
Elisa Martinuzzi (Bloomberg View) May 21, 2019
The ECB looks unwilling to be a bystander any longer.

Traders Diverging From Economists Puts Fed in a Bind
Jim Bianco (Bloomberg View) May 21, 2019
The market is signaling that the economy needs lower interest rates, but the central bank is afraid of fostering bubbles.

Looking Back at 100
Richard N. Haass (Project Syndicate) May 21, 2019
Three themes have dominated the author's analysis of global affairs in his previous 99 Project Syndicate commentaries. All of them – Middle East turmoil, the rise of China, and the dissolution of the post-World War II and post-Cold War order – are certain to figure prominently in the next hundred.

Robo-Apocalypse? Not in Your Lifetime
J. Bradford DeLong (Project Syndicate) May 21, 2019
Not a week goes by without some new report, book, or commentary sounding the alarm about technological unemployment and the "future of work." Yet in considering the threat posed by automation at most levels of the value chain, we should remember that robots cannot do what humans cannot tell them to do.

In Defense of Europe
Michel Barnier (Project Syndicate) May 21, 2019
Faced with growing geopolitical challenges from Russia, China, and the United States, Europe must take its future into its own hands by defending its interests and values. Otherwise, the European Union and its member states will become others' prey in the new global (dis)order.

Unconventional monetary policy: A tale of heterogeneity
Anne-Laure Delatte, Pranav Garg, Jean Imbs (VoxEU) May 21, 2019
The ECB's unconventional monetary policy package implemented in February 2012 changed collateral requirements. This column examines the effects in the French credit market, using data on corporate loans. Credit indeed increased after the liquidity injection, exclusively driven by supply. There was also strategic risk-taking by a group of banks, an unintentional implication of the policy.

Outward FDI and employment in Japanese manufacturing firms
Liu Yang and Bin Ni (VoxEU) May 21, 2019
Concerns have been raised that outward foreign direct investment may reduce domestic employment and lead to the ‘hollowing-out’ of the manufacturing industries at home. This column uses a unique dataset of Japanese firms’ overseas activities to show that going abroad does not necessarily lead to a reduction of domestic employment. Investment by Japanese firms into other Asian countries has a positive impact on domestic job creation and a negative impact on job destruction, whereas the impact of investment into European and North American countries is negative for both job creation and destruction in Japan.

Democrats Won’t Win by Being Trump Lite on Trade
Edward Alden (FP) May 21, 2019
If Democrats do not speak out on trade, they will send a message to the world that the Trump administration’s trade policies are supported in the United States.

Pound is being buffeted by global and domestic headwinds
Katie Martin (FT) May 22, 2019
Start of sterling’s current malaise coincides with a general flight from risky assets.

EU’s bond markets underprice the risk of populism
John Plender (FT) May 22, 2019
Politicians in northern Europe need to get to grips with a flawed monetary union.

Emerging markets suffer collateral damage from trade war
Hung Tran (FT) May 22, 2019
Falling trade and investment hit developing countries especially hard.

Corporate India has no time to waste on debts
Henny Sender (FT) May 22, 2019
Companies may find pressure to trim borrowings will increase as competition for capital grows.

Shifting trade and supply chains challenge emerging economies
Jonathan Wheatley and Valentina Romei (FT) May 22, 2019
Reliance on manufacturing becomes a weakness as US and China turn inwards.

The Turkish Contagion Risk
WSJ May 22, 2019
Erdogan is running out of options to prevent a collapse of the lira.

The Dollar May Be Knocked off Its Pedestal
Sahil Mahtani (WSJ) May 22, 2019
America’s competitors, friend and foe, have opportunities to challenge the U.S. currency.

Trade-War Refugees Could Find Haven in Emerging Markets
Nir Kaissar (Bloomberg View) May 22, 2019
They are poised to hold up better than the U.S. during the next downturn.

Modi Needs Less Power, Not More
Mihir Sharma (Bloomberg View) May 22, 2019
The Indian prime minister’s greatest successes have come when he’s empowered independent institutions rather than undermining them.

Japan Begins Experiment of Opening to Immigration
Noah Smith (Bloomberg View) May 22, 2019
As the population ages and shrinks, the country is making it easier for foreigners to work and become citizens.

Modi Has Failed to End India’s Tax Terror
Andy Mukherjee (Bloomberg View) May 22, 2019
Fickle policy risks damaging the country’s allure for investors. It’s time to stop raking up the past.

Huawei Is the Long Fuse in Trump’s Trade War
Mark Gongloff (Bloomberg View) May 22, 2019
It looks like everyone is settling in for a long – and potentially costly – financial and political battle.

China's Fire Sale of Trophy Assets Is No Bargain
Nisha Gopalan (Bloomberg View) May 22, 2019
The indebted Chinese conglomerate is getting decent bids for its hotel properties. That defies some of the challenges facing the luxury market.

The Europe of Tomorrow
Javier Solana (Project Syndicate) May 22, 2019
It is still essential to stress the EU’s role as a guarantor of peace and prosperity following World War II. But today’s EU must foster additional sources of legitimacy if it is to appeal to today's post-postwar generation.

The EU’s Four Challenges
Ana Palacio (Project Syndicate) May 22, 2019
Whatever the next European Parliament's composition, the imperative will be the same: EU institutions must trade ambition for humility, focusing their attention not on their own power or status, but rather on upgrading and fortifying the project for which they claim to stand. If they fail, the road ahead will only become more perilous.

Can the Belt and Road Become a Trap for China?
Yasheng Huang (Project Syndicate) May 22, 2019
Through its Belt and Road Initiative, China is building ties to some of the world’s most authoritarian, financially opaque, and economically backward countries. Rather than exposing itself to massive political, economic, and default risks, Chinese policymakers should instead seek to repair relations with the West.

How Inflation Could Return
Mohamed A. El-Erian (Project Syndicate) May 22, 2019
After years of low inflation, investors and policymakers have settled into a cyclical mindset that assumes advanced economies are simply suffering from insufficient aggregate demand. But they are ignoring structural factors at their peril.

Has Austerity Been Vindicated?
Robert Skidelsky (Project Syndicate) May 22, 2019
A correlation between fiscal retrenchment and economic growth tells us nothing about the underlying relationship between the two. This should be borne in mind in light of new research suggesting that austerity may well be the right policy in a recession.

Decentralised implementation of centrally mandated antipoverty programmes
Martin Ravallion (VoxEU) May 22, 2019
Even when the central government is committed to a jobs guarantee, rationing of work opportunities can arise under decentralised implementation in poor places. This column examines India’s efforts to implement such a scheme and finds that there are two main drivers of this rationing: local administrative costs and local corruption. Partial administrative reforms by the centre can have perverse effects. Deeper policy reforms are needed to assure that stipulated rights for poor people are attained in practice.

Demystifying Belt and Road
Yuen Yuen Ang (FA) May 22, 2019
The Struggle to Define China’s “Project of the Century”.

Fiscal Policy Options for Japan
Olivier Blanchard and Takeshi Tashiro (PIIE) May 22, 2019
For many years, the Japanese government has promised an eventual return to primary budget surpluses, but it has not delivered on these promises. Its latest goal is to return to primary balance by 2025. However, in the current economic environment in Japan, primary primary deficits may be needed for a long time, because they may be the best tool to sustain demand and output, alleviate the burden on monetary policy, and increase future output. What primary deficits are used for, however, is equally important, and the Japanese government should put them to better use. Given Japan’s aging population, the government should spend on measures aimed at increasing fertility—and by implication population and output growth—which are likely to more than pay for themselves.

Yield curve inversion keeps investors on their toes
Joe Rennison (FT) May 23, 2019
Gap between 3-month and 10-year yields tends to collapse before recessions.

Why Germany really needs to blow out its budget
Sylvain Broyer (FT) May 23, 2019
Upgrading the country’s creaking infrastructure is essential, at a time of free money.

Modern monetary theory offers insights into the eurozone
Eric Lonergan (FT) May 23, 2019
Thanks to ECB governor Mario Draghi the euro area has a way of dealing with fiscal freeriding.

Trade war sparks fears of China weaponising US Treasuries
Joe Rennison and Colby Smith (FT) May 23, 2019
Recent $20bn sale of US debt could not be explained by typical ebb and flow of Beijing’s holdings.

Why China doesn't want to breach its renminbi red line
Colby Smith (FT) May 23, 2019
It will create a lot of volatility.

How Narendra Modi Seduced India With Envy and Hate
Pankaj Mishra (NYT) May 23, 2019
The prime minister has won re-election on a tide of violence, fake news and resentment.

Trump’s Trouble in the Farm Belt
WSJ May 23, 2019
Farm welfare won’t substitute for lost foreign markets.

Narendra Modi’s Massive Mandate
WSJ May 23, 2019
The Indian leader gets another chance to liberate the economy.

What’s Missing From the Trump Economic Boom
Joseph C. Sternberg (WSJ) May 23, 2019
Growth and productivity are up, but investment is a soft spot, and neither right nor left has good answers.

The blacklisting of Huawei might be China’s Sputnik moment
Fareed Zakaria (WP) May 23, 2019
Could the U.S. strategy of playing hardball on trade inspire a tech leap by the Asian giant?

The rich world is enjoying an unprecedented jobs boom
Economist May 23, 2019
Capitalism’s critics are yet to notice.

Zimbabwe struggles to keep its fledgling currency alive
Economist May 23, 2019
Redollarisation.

Global poverty reduction has slowed down—again
Homi Kharas, Kristofer Hamel, Martin Hofer and Baldwin Tong (Brookings) May 23, 2019
During the last year, a new poverty narrative gained acceptance across the world. The trends in our global poverty predictions—which we published on the World Poverty Clock—were confirmed by a number of other sources, including the World Bank, the Overseas Development Institute (ODI), and the Institute for Health Metrics and Evaluation (IHME). By and large, the overall message is a discouraging refrain: Global poverty reduction is slowing down, Africa is now home to the majority of the world’s extremely poor (living on less than $1.90 per day in 2011 PPP), and Nigeria has become the most visible frontier in the fight against extreme poverty.

How This Trade War Will Remake the World
Karl W Smith (Bloomberg View) May 23, 2019
As China and the U.S. form competing coalitions, other nations and businesses will be forced to choose.

U.S. and China Go Their Own Ways With AI
Leonid Bershidsky (Bloomberg View) May 23, 2019
Western democracies want algorithms that are transparent and can be appealed to humans. That's a better approach.

With Friends Like the U.S, Who Needs Economic Foes?
Daniel Moss (Bloomberg View) May 23, 2019
The trade war is punishing America's closest allies. That simply reminds Japan and South Korea of their reliance on China.

Buying Anything Linked to China Is a Risky Bet
John Authers (Bloomberg View) May 23, 2019
Markets seem to be underpricing the risk of the trade war, but that will change. Also, political uncertainty and the Ides of May.

How Sovereign Wealth Funds Threaten Capitalism
Mark Gilbert (Bloomberg View) May 23, 2019
By underwriting more private investments, the funds risk hollowing out public markets.

Modi Reigns Supreme. Now India's Economy Awaits
Andy Mukherjee (Bloomberg View) May 23, 2019
The prime minister’s remarkable election victory offers a momentous chance to correct the missteps of his first term.

This Is Modi’s India Now
Mihir Sharma (Bloomberg View) May 23, 2019
This election was fought and won over identity -- the identity of the country and the identity of Indians.

The Real Cost of Trump’s Tariffs
Jeffrey Frankel (Project Syndicate) May 23, 2019
Whereas winners tend to outnumber losers when trade is liberalized, raising tariffs normally has the opposite result. US President Donald Trump appears to have engineered a spectacular example of this: his trade war with China has hurt almost every segment of the US economy, and created very few winners.

Public debt and the risk premium
Cinzia Alcidi and Daniel Gros (VoxEU) May 23, 2019
The relationship between high public debt and low interest rates is once again at the forefront of debate.This column shows that countries with high debt levels pay a risk premium. This creates the potential for self-reinforcing loops of high debt and high risk premia, which can become explosive.

Bubbles pop, downturns stop
Martin Hirt, Kevin Laczkowski, and Mihir Mysore (McKinsey) May 23, 2019
Economic downturns are impossible to predict and sure as sunrise. Build resilience now, because when the sun comes up, you’d better be moving.

Modi should opt for reform, not division
FT View May 24, 2019
India’s re-elected premier must focus his efforts on modernising his country.

Who's paying for the US-China trade war?
Colby Smith (FT) May 24, 2019
US consumers are feeling the pain. s

Trump ignores macro cracks as trade tensions flare
David Goldman (AT) May 24, 2019
The economy is continuing to show signs of weakness, a reality that undermines the US president’s approach to China trade talks.

The Current Trade War Is Costing Consumers. Washing Machines Can Help Explain Why.
Brink May 24, 2019
It can be difficult to map the myriad facts and figures of trade policy—say, $60 billion in American imports—to the effects of policy. What do these numbers mean in tangible terms? Two recent working papers from the National Bureau of Economic Research found that the costs of tariffs were passed to consumers. BRINK examined how washing machines can explain why that happened.

Europeanism Vs. Euroskepticism
Andrés Ortega (Globalist) May 24, 2019
More than any other, these EU elections are a battleground to determine the future direction of the European project.

A Moment of Clarity in the Brexit Chaos
Bloomberg View May 24, 2019
May’s compromise is dead, and Parliament has no answer. The country should vote again.

China’s Brightest Are the Trade War’s Latest Casualties
Adam Minter (Bloomberg View) May 24, 2019
The country’s largest graduating class ever is about to confront an especially grim job market.

Let Singapore-on-Thames Fight It Out With Europe
Lionel Laurent (Bloomberg View) May 24, 2019
The EU and the City have become too codependent in financial services. The post-Brexit settlement would be a chance for both sides to break free.

The Fed Is Hearing It From Both Sides
Karl W Smith (Bloomberg View) May 24, 2019
When both the right and left want the Fed to change its approach to inflation, maybe it should listen.

Are Indian Democracy’s Weaknesses Inherent?
Pranab Bardhan (Project Syndicate) May 24, 2019
Indian governance system, for all its messiness, is more resilient than China's. In the absence of political opposition and media scrutiny, the state tends to overreact in the face of crises, which renders the Chinese system more brittle.

Germany’s Dangerously Flawed Energy Policies
Hans-Werner Sinn (Project Syndicate) May 24, 2019
Germany has made a noble effort to reduce greenhouse-gas emissions and replace conventional energy sources with wind and solar power. But now it is time to face reality: the country cannot possibly play a role in combating climate change until it first reverses its decision to phase out nuclear power.

Three guiding principles for R&D policies in the digital era
Ramy El-Dardiry, Bastiaan Overvest and Michiel Bijlsma (VoxEU) May 24, 2019
Digitalisation is transforming human life – from the way we interact with each other to the way we work, relax, and create. R&D within companies is no exception. This column lays out pathways for policymakers to successfully adapt R&D policies to these changes based on three guiding principles: direct policies towards spillovers, make policies technology-neutral, and do not favour superstars over challengers.

Leisure-enhancing technological change
Lukasz Rachel (VoxEU) May 24, 2019
How we spend our time is changing rapidly. This column argues that an important driver is leisure-enhancing innovation, aimed at capturing our time, attention, and data. Leisure-enhancing technologies can help account for both the rise in leisure hours and the decline in productivity observed across the industrialised world. Their nature carries important implications for the long-run viability of the platforms’ business models, for measurement of economic activity, and for welfare. How we spend our time is changing rapidly.

The Growing Dangers of Trump’s Trade War with China
John Cassidy (New Yorker) May 24, 2019
Contemporary politics and years of history raise the possibility that an economic battle with China could spill over to other kinds of conflict.

Good Health Supports Good Governance
Matthew M. Kavanagh (FP) May 24, 2019
The evidence suggests policymakers do not have to trade global health for governance when it comes to international aid.

Risk of more political shocks keeps investors on edge
Michael Mackenzie (FT) May 25, 2019
Concerns remain that tariff dispute between US and China will escalate.

Huawei v the US: Trump risks a tech cold war
Richard Waters, Kathrin Hille and Louise Lucas (FT) May 25, 2019
Curbs on the Chinese company play into the trade war rhetoric. But American industry fears it has a lot to lose from the dispute.

After Theresa: The Brexit Mess and the EU
Holger Schmieding (Globalist) May 25, 2019
Many on the continent may now see an orderly “velvet” Brexit as the least bad among the realistic outcomes.

Brexit: Could Boris Do What Theresa Could Not?
Holger Schmieding (Globalist) May 25, 2019
While he did not endear himself to his continental colleagues during his stint as foreign minister, Boris Johnson’s flexibility could turn into an advantage. | By Holger Schmieding

No Deal Exit? UK Should Think Twice
Holger Schmieding (Globalist) May 25, 2019
Even in case of a hard Brexit, the UK would probably end up having to accept most of the Withdrawal Agreement. | By Holger Schmieding

Lessons from the Age of Mass Migration
Marco Tabellini (VoxEU) May 25, 2019
Recent waves of immigration in the US and Europe have triggered debate around the economic and political impact. This column uses evidence from migration of Europeans to the US in the first half of the 20th century to show that large cultural differences can incite anti-immigrant sentiment despite their positive economic impact. Therefore, policymakers should give due attention to cultural assimilation and cohesion policies.

The macroeconomic consequences of impaired money markets
Fiorella De Fiore, Marie Hoerova and Harald Uhlig (VoxEU) May 25, 2019
Money markets are an important source of short-term funding for banks, which rely heavily on them to cover their liquidity needs. But as this column shows, when money markets do not function smoothly, banks may have to deleverage or increase their holdings of liquid assets, leading to a decline in lending and output. This decline can be mitigated by central banks if they increase the size of their balance sheets.

Eight Reasons Why Inequality Ruins the Economy
Chris Dillow (Evonomics) May 25, 2019
What matters is not so much the level of inequality as the effect it has.

The $16bn bailout of US farmers is misguided
FT View May 26, 2019
Patching up victims of a trade war to keep it going is ill-advised.

Are we at risk of a Chinese dollar dump?
Robert Samuelson (WP) May 26, 2019
The collision between the Trump administration and Beijing heralds a new era in U.S.-China relations.

America’s ‘exorbitant privilege’ is Europe’s omission
Wolfgang Münchau (FT) May 26, 2019
So far, the EU has shown no interest in increasing its global role.

What Britain Needs From Its Next Prime Minister
Bloomberg View May 26, 2019
The debate over Brexit demands a good strong dose of honesty.

Today’s China will never be a superpower
Charles Parton (FT) May 27, 2019
It cannot afford it, and the single-party state will not allow the necessary reforms.

Bank of Japan may have to rouse itself once more
Lucy Hornby (FT) May 27, 2019
Pioneer of radical monetary policies will soon have to innovate again.

If it’s ‘the economy, stupid,’ why did Modi win?
Milan Vaishnav (WP) May 27, 2019
The question of leadership may have diverted attention away from the state of the economy, but Modi’s honeymoon will be short-lived.

China’s Belt and Road Reaches Latin America
Andre Dabus, Meghna Basu and Leon Yao (Brink) May 27, 2019
Over the past 10 years, Chinese investment in South America has accelerated dramatically, increasing by more than 480 percent between 2008 and 2018. Over half of China’s investments into South America have gone toward infrastructure projects—particularly in energy and transport.

Why the Yuan Could Break 7 ... or 6 ... or 8
Daniel Moss (Bloomberg View) May 27, 2019
Big, round numbers matter less than the velocity and timing of exchange-rate moves. It makes sense for a slower China to have a weaker currency.

China’s Banking Cleanup Needs a Bigger Mop
Anjani Trivedi (Bloomberg View) May 27, 2019
The Baoshang takeover suggests problems may be emerging at other small lenders.

Game of EU Thrones
Harold James (Project Syndicate) May 27, 2019
The European Parliament election was a long and complex story with a surprising and, for many, unsatisfactory outcome. Yet notwithstanding the muddled conclusion, a new European political order seems to be emerging – one that is likely to leave traditional parties of both the left and the right behind.

The ECB’s Changing of the Guard
Lucrezia Reichlin (Project Syndicate) May 27, 2019
After steering the eurozone through a decade of crises, the top leaders of the European Central Bank are now on their way out. Their successors will face both similar and new challenges, and whether they confront them as effectively will depend on European national governments picking the right women and men for the job.

How Will the US-China Trade War End?
Andrew Sheng and Xiao Geng (Project Syndicate) May 27, 2019
The US-China trade war seems not to have caused much pain yet. But after 117 consecutive months of economic expansion – compared to an historical average of 48 months – the US could soon find itself thrown back into a painful recession, owing to disruptions caused by its own trade policy.

Japan Then, China Now
Stephen S. Roach (Project Syndicate) May 27, 2019
Back in the 1980s, Japan was portrayed as the greatest economic threat to the United States, and allegations of intellectual property theft were only part of Americans' vilification. Thirty years later, Americans have made China the villain, when, just like three decades ago, they should be looking squarely in the mirror.

Modern Monetary Inevitabilities
Robert Dugger (Project Syndicate) May 27, 2019
For all the talk of Modern Monetary Theory representing a brave new frontier, it is easy to forget that the United States has gone down this road before, when the US Federal Reserve financed the war effort in the 1940s. Then, as now, the question is not about government debt, but about the debt's purpose and justification.

The cultural roots of firm entry, exit, and growth
Katharina Erhardt and Simon Haenni (VoxEU) May 27, 2019
Firm entry is widely viewed as a central driver of economic growth, so understanding the role of culture in explaining differences in entrepreneurial activity is important. Using Swiss data on individuals’ cultural origins going back to the 18th century, this column compares the entrepreneurial activity of individuals who live in the same municipalities but who have their cultural origins on different sides of the language border. It finds that individuals with ancestry from the German-speaking side founded 20% more firms than those with ancestry from the French-speaking side. Yet, the cultural origin of the founder does not affect firm-level outcomes such as bankruptcy or revenues.

How globalisation made Narcos: Understanding violent crime in urban Mexico
Melissa Dell, Ben Feigenberg, and Kensuke Teshima (VoxDev) May 27, 2019
Manufacturing job loss, induced by competition with China, increased cocaine trafficking, thereby increasing violent crime in urban areas in Mexico.

Today’s China will never be a superpower
Charles Parton (FT) May 28, 2019
It cannot afford it, and the single-party state will not allow the necessary reforms.

Risk of liquidity shocks haunts China’s fast-growing bond markets
Don Weinland (FT) May 28, 2019
Foreign investors pile into Chinese bonds but worry about market glitches.

Bank of Japan may have to rouse itself once more
Takuji Okubo (FT) May 28, 2019
Pioneer of radical monetary policies will soon have to innovate again.

A Tariff Issue on Which Free and Fair Traders Can Agree
Peter Navarro (WSJ) May 28, 2019
Flawed WTO rules allow other countries to charge significantly higher duties than America does.

Is inequality really on the rise?
Ana Revenga and Meagan Dooley (Brookings) May 28, 2019
The Occupy Wall Street movement in the U.S. and the Yellow Vest protests in France capture a common feeling of discontent: The gap between the haves and the have-nots is growing.

Not All Developing Nations Are Created Equal
Noah Smith (Bloomberg View) May 28, 2019
The crude categories used to define a country’s economic status fail to capture differences and potential.

Frackers Are Even Less Popular Than When Oil Was at $10
Liam Denning (Bloomberg View) May 28, 2019
Their own predilections for production and spending are to blame.

Modi, Resist the Urge to Be India's Xi Jinping
Andy Mukherjee (Bloomberg View) May 28, 2019
The prime minister can make the most of his economic opportunity only by suppressing his strongman instincts.

Britain’s Great Brexit Divide Gets Deeper
Therese Raphael (Bloomberg View) May 28, 2019
Both big political parties lost the European elections. Both are faced with existential decisions about where they stand on Europe.

Clear Messages From EU Voters, But No Easy Way Forward
Mohamed Aly El-Erian (Bloomberg View) May 28, 2019
Britons are fed up with the Brexit logjam, and the Continent wants a greater focus on the environment.

What If the Trade War Is Really Deflationary?
Gary Shilling (Bloomberg View) May 28, 2019
Tariffs are likely to suppress inflation in the long run as governments, businesses and consumers take offsetting actions and growth slows.

Greece Hands Out a Lesson to Italy
Ferdinando Giugliano (Bloomberg View) May 28, 2019
Alexis Tsipras is a cautionary tale for over-promising populists everywhere. No wonder investors are warming to the prospect of change in Athens.

Argentina’s Election Won’t Change Its Economic Options
Mac Margolis (Bloomberg View) May 28, 2019
Whoever wins will face little room for maneuver.

India’s Cult of Modi
Shashi Tharoor (Project Syndicate) May 28, 2019
The recent Indian election will be a case study in how to upend the conventional assumption of electoral politics that an incumbent is judged on his record of performance against his own promises. Prime Minister Narendra Modi fulfilled none of his, so why did voters reward him with a landslide victory?

Beyond Unemployment
Michael Spence (Project Syndicate) May 28, 2019
In modern economies, people may have jobs, but they still harbor major concerns in a wide range of areas, including security, health and work-life balance, income and distribution, training, mobility, and opportunity. By focusing solely on the unemployment rate, policymakers are ignoring the many dimensions of employment that affect welfare.

A Guidebook for Financial Crisis Managers
Howard Davies (Project Syndicate) May 28, 2019
After World War II, Winston Churchill confidently asserted that history would treat him kindly because “I propose to write that history.” Now, a decade after the global financial crisis, three of the key players in that episode have co-authored a book that is interesting not so much for its treatment of the past as for its proposals for the future.

Measuring the welfare effects of AI and automation
Jacques Bughin, Christopher Pissarides and Eric Hazan (VoxEU) May 28, 2019
Artificial intelligence promises economic growth as well as creating fear for those whose jobs it may replace. This column takes a wider approach to examining how AI and other technologies will affect citizens’ welfare beyond just their income. It argues that the new technologies are intrinsically neither good nor bad, it is how they are deployed and how the transition is crafted that conditions the welfare dynamics of societies.

The Irish crisis: Lessons for small central banks
Patrick Honohan (VoxEU) May 28, 2019
Many significant aspects of the Irish macro-financial crisis of 2008-13 are not well known, some remain disputed, and some are often misunderstood. This column contributes to filling these gaps. It argues that while the crisis cannot be blamed on membership of the euro area, as Ireland’s fiscal and regulatory policies in the first decade of the system fell far short of what was needed to stay safe, management by Europe of the euro area crisis as a whole was also poor. It also draws some wider lessons for the appropriate conduct of central banking in small countries.

Beyond 2030: Economic growth in the Middle East and North Africa
Karen E. Young (AEI) May 28, 2019
Energy-dependent growth in the Middle East and North Africa (MENA) region, whether in traditional oil and gas exports or petrochemical production and global refinery operations, will be sensitive to shifts in Asian economies and new technology and efficiency innovation. Without structural reforms to subsidies and labor markets, a reliance on debt finance now kicks the can down the road toward difficult fiscal choices in the future. MENA economies are becoming more integrated into emerging markets not by increased trade but through state-led development partnerships and the use of aid and economic statecraft.

Under Modi 2.0, Will India Embrace Tough Economic Reforms?
K@W May 28, 2019
Narendra Modi's Bharatiya Janata Party and its allies won India's elections by a landslide last week. Will the Modi government use this second chance to strengthen India's economy?

EU and Japan seek to harness Trump’s China trade ire
Alan Beattie (FT) May 29, 2019
Efforts to get Washington to agree on common approach over China have yet to bear fruit.

States create useful money, but abuse it
Martin Wolf (FT) May 29, 2019
To the extent modern monetary theory is true, it is unoriginal; to the extent it is original, it is false.

Mario Draghi’s policy bazooka may be his most precious legacy
Megan Greene (FT) May 29, 2019
The special lending programme has flown under the radar but could be a game-changer.

How the trade war between China and America is changing global business
Economist May 29, 2019
Alibaba’s experience shows how relations between America and China have soured.

The Bond Market Is Giving Ominous Warnings About the Global Economy
Neil Irwin (NYT) May 29, 2019
An inverted yield curve has typically not been a good sign.

Is Trump now launching a currency war, too?
William Pesek (AT) May 29, 2019
The US Treasury Department added Singapore, Malaysia and Vietnam to its watchlist. China, Japan and South Korea are there too.

Principles for Debt Transparency: A Few Steps Forward, a Few Questions Linger
Mark Plant (CGD) May 29, 2019
When the G20 ministers of finance and central bank governors meet in early June, adoption of the Principles for Debt Transparency recently promulgated by the Institute of International Finance (IIF) will be on the agenda. The result of over 18 months of discussions among IIF members (mostly international banks), the Principles come as an industrywide reaction to various loans made to developing countries that were both nontransparent and put macroeconomic stability at risk. While long in the making, this self-policing initiative is welcome, absent a binding international regulatory framework to police miscreant lenders. But it will require much more effort by the international financial community for the Principles to do the job—in many ways, the Principles are only a start.

Reforming South Africa’s Economy
Sechaba Nkosi (Globalist) May 29, 2019
The successful unbundling of utilities giant Eskom would aid badly needed structural reforms in the South African economy.

The ‘Exorbitant Privilege’ of Donald Trump and Angela Merkel
Chris Bryant (Bloomberg View) May 29, 2019
The U.S. and Germany get huge benefits from their currencies. They should remember that when complaining about trade or defending surpluses.

The First Step to Shun China: Invest in Trade With Other Exporters
Conor Sen (Bloomberg View) May 29, 2019
The U.S. could eventually get what it needs from Vietnam, Indonesia, Mexico and elsewhere – but those places need a lot more infrastructure if they're going to sell a lot more stuff.

The Rich World’s Canaries Are Starting to Look Sickly
David Fickling (Bloomberg View) May 29, 2019
Ripples from Australia and New Zealand are often among the earliest signs of trouble for the northern hemisphere.

Greece's Bad-Debt Monster Is Alive and Kicking
Elisa Martinuzzi (Bloomberg View) May 29, 2019
The country's banks have staged a spectacular stock market comeback. But the optimism may be premature.

Emerging Markets Can't Evade a China Slowdown
Komal S Sri-Kumar (Bloomberg View) May 29, 2019
Expect any turbulence in the nation’s financial markets to be transmitted across the developing world.

The Trade War’s Biggest Losers
Tyler Cowen (Bloomberg View) May 29, 2019
Smaller countries caught in the middle are being forced to choose sides.

Closing the Global Governance Gap
Kemal Dervis (Project Syndicate) May 29, 2019
The current wave of new technology is likely to transform the world, perhaps more deeply than ever before, and will potentially accelerate economic growth. Finding effective ways to govern in this digital milieu will be the biggest global challenge of the twenty-first century.

Making “Generation Educated” a Reality
Gordon Brown (Project Syndicate) May 29, 2019
Year after year, the international community falls further behind in upholding its commitment to provide quality education to all children by 2030. With the number of out-of-school children having far surpassed crisis levels, it's time to adopt a new approach.

The Reference Effect of Government Bonds on Corporate Borrowing Costs
Mark J. Flannery, Claire Yurong Hong and Baolian Wang (VoxChina) May 29, 2019
It has been widely argued that government bonds can be used as a reference point for pricing corporate bonds. This “reference” role can reduce the cost of corporate borrowing. The authors study this question by examining a unique experiment in China. China issued two sovereign bonds denominated in U.S. dollars (USD) in October 2017, the first such sale in thirteen years. The issuance of sovereign bonds serves as useful reference instruments for USD-denominated Chinese corporate bonds, helping investors to price and hedge the risks inherent in Chinese corporate bonds. We find that corporate bonds experienced a decline in yield spreads, bid-ask spreads, and price volatility around the time the sovereign bond issuance was announced. The yield spread changes are particularly large for corporate bonds with maturities similar to those of the USD sovereigns.

Export-led growth in Central and Eastern Europe
Jan Hagemejer and Jakub Muck (VoxEU) May 29, 2019
Fragmentation of production has made it difficult to assess the contribution of exports to economic growth. This column decomposes growth into value added absorbed at home and that exported.Empirical results show that economic growth in Central and Eastern European after 1995 was mainly driven by exports. The pace of convergence in Europe for exported value added was around four times faster than for domestic value added.

The procyclicality of banking in the euro area
Harry Huizinga and Luc Laeven (VoxEU) May 29, 2019
A high procyclicality of banks’ loan loss provisioning is undesirable from a financial stability perspective, as it implies that bank capitalisations are more negatively affected at the trough of the business cycle, exactly when capital market conditions for banks are at their weakest. This column finds that provisioning procyclicality in the euro area is about twice as high as in other countries. This has important implications for the supervision of euro area banks going forward.

£350 million a week: The output cost of the Brexit vote
Benjamin Born, Gernot Müller, Moritz Schularick and Petr Sedlácek (VoxEU) May 29, 2019
It is hard to calculate the current cost of Brexit, because there is no obvious counterfactual. The original version of this column, first published in November 2017, calculated the cost by letting a matching algorithm determine which combination of comparison economies best resembles the pre-referendum growth path of the UK economy. The results suggested a loss of 1.3% of GDP, or close to £300 million per week, since the vote took place. Subsequent updates using the latest OECD data suggest that the negative drag from the Brexit vote now appears to be roughly £350 million a week, but under current OECD forecasts we can expect the output loss to increase to about 4% of GDP by end-2020.

Can wealth taxation work in developing countries?
Juliana Londono-Velez (VoxDev) May 29, 2019
Progressive wealth taxes may be difficult to enforce if wealthy individuals underreport their wealth, but disclosure incentives and greater enforcement can improve tax collection.

Asia had the upper hand
Chris Nierstrasz (Aeon) May 29, 2019
For centuries, Europeans in Asia were guests, trading partners and subordinates. Only much later did Empire seem imaginable

Britain is now stranded in Brexit limbo
Philip Stephens (FT) May 30, 2019
Barring a referendum, doing nothing looks increasingly like the default option.

Gold will languish so long as US markets stay resilient
Neil Hume (FT) May 30, 2019
Greenback has replaced metal as place to store cash when trouble looms.

Stock investors in China should prepare for a cold war
James Kynge (FT) May 30, 2019
Some fund managers have ditched companies that are vulnerable to US export bans.

The Bond Market Is Trying to Tell Us Something (Worry)
Matt Phillips and Stephen Grocer (NYT) May 30, 2019
Bond yields, the yield curve, inflation expectations, Fed-rate predictions. The bond market might seem indecipherable, but it’s full of important clues about the economy.

No, China isn’t paying for the farm bailout. Americans are.
WP May 30, 2019
To make up for his tariffs, Trump pushes aid that could morph from temporary assistance into permanent entitlements.

Democrats cannot duck a fight with Trump on trade forever
Greg Sargent (WP) May 30, 2019
And they should't fear one, either.

Europe’s crises are over, but the populist fury remains
Fareed Zakaria (WP) May 30, 2019
The realities behind fears about immigration and the economy don’t match facts.

As Global Protectionism Rises, Japan Emerges as Asia’s Free Trade Champion
John West (Brink) May 30, 2019
Japan’s activism in trade and investment liberalization has immense geopolitical importance and provides a critical counter-narrative to the rising protectionism in some of the world’s key markets. How Japan became a free trade champion—and why it matters.

The future of aid: How the global development business is evolving
George Ingram (Brookings) May 30, 2019
Three recent publications on trends in global development cover both how the field is approached today and how it can be improved.

Thailand Risks Squandering Its Golden Chance
Andy Mukherjee (Bloomberg View) May 30, 2019
Trump’s tariffs have given the nation’s exporters a chance to displace China. Political stalemate threatens that opportunity.

Stop Blaming the Trade War for Everything
Daniel Moss (Bloomberg View) May 30, 2019
The catch-all excuse for the global economy’s ills has merely amplified or accelerated existing trends.

June Could Be the Cruelest Month for China’s Yuan
Shuli Ren (Bloomberg View) May 30, 2019
If you thought May was tough, just look at what's coming.

We All Need to Calm Down About Rare Earths
David Fickling (Bloomberg View) May 30, 2019
Worries about China’s monopoly over this suite of elements flare up every now and again. The truth is it’s a paper tiger.

South Africa Is Hobbled by Market Change
Marcus Ashworth (Bloomberg View) May 30, 2019
Leaving aside the politics and the economy, a re-weighting of emerging markets indexes puts a limit on the country’s attractiveness.

The Case for Carbon Tariffs
Adair Turner (Project Syndicate) May 30, 2019
By backing tariffs that would reflect the carbon intensity of key imports, more than 3,500 US economists have broken with the free-market orthodoxy that national environmental policies should not impede global trade liberalization. They were right to do so.

Europe’s Citizens Say They Want a More Political EU
Jean Pisani-Ferry (Project Syndicate) May 30, 2019
The recent European Parliament election suggests that a growing share of European voters sees things differently from national governments. Whereas citizens clearly used their votes to express policy preferences, very few governments are ready for a more political EU leadership.

Making Globalization Work for Africa
Ngozi Okonjo-Iweala and Brahima Coulibaly (Project Syndicate) May 30, 2019
Making globalization more inclusive will require policies that help African economies to converge with high-income countries. African policymakers should focus on accelerating regional integration, bridging gaps in labor skills and digital infrastructure, and creating a mechanism to own and regulate Africa’s digital data.

After Neoliberalism
Joseph E. Stiglitz (Project Syndicate) May 30, 2019
For the past 40 years, the United States and other advanced economies have been pursuing a free-market agenda of low taxes, deregulation, and cuts to social programs. There can no longer be any doubt that this approach has failed spectacularly; the only question is what will – and should – come next.

Trade war: The clash of economic systems threatening global prosperity: A new eBook
Meredith Crowley (VoxEU) May 30, 2019
As a trade war of unprecedented scope and magnitude engulfs the world’s two largest economies, this column introduces a new Vox eBook that seeks to shed light on the origins of the conflict, the current impacts on economic activity around the world, and the likely consequences for the future of globalisation. It concludes that the prospects for the future of the multilateral trading system look grim.

Teflon Modi Eyes FDI
Kunal Bose (YaleGlobal) May 30, 2019
The government's hope is to tackle poverty with economic growth and foreign direct investment.

Recession Update: Elevated Interest, Low Risk
Azhar Iqbal (WF) May 30, 2019
The recent inversion of the yield curve has elevated investors' interest in the risk of a recession. However, our models indicate a low probability that a recession will occur within the next six months.

Argentines should reject the return of Peronism
FT View May 31, 2019
President Mauricio Macri should stick to his guns on economic policy.

Warning lights flash for emerging market investors
Jonathan Wheatley (FT) May 31, 2019
Foreign money gushes out of developing economies amid fears of trade war escalation/

How Trump’s Trade War Is Being Fought Around the World
Carlos Tejada and Amie Tsang (NYT) May 31, 2019
Mexico, China, Japan, Europe, Canada: The White House’s various conflicts add up to a broad assault on a postwar effort to build economic ties around the world.

Tariff Man Unchained
WSJ May 31, 2019
Trump hits Mexico on trade to solve a U.S. immigration mess.

Trump’s tariffs on Mexico are the kind of erratic act the Constitution is meant to prevent
WP May 31, 2019
Congress needs to rein in the president.

Washington is wrong about China’s economy
David Goldman (AT) May 31, 2019
The US economy is weaker, and China’s stronger, than analysts believe.

How Donald Trump Is Losing the Trade War
Alexei Bayer (Globalist) May 31, 2019
Imitation is the highest form of flattery. Trump is not so much fighting China on trade as turning the U.S. into China.

Why the trade arithmetic favors China
Kaushik Basu (Brookings) May 31, 2019
The biggest risks facing the world economy today stem from the escalating trade war between the United States and China. President Trump's decision to increase tariffs on Chinese goods risks disproportionately harming the U.S. economy.

Trump's New Tariff Actions: A Wakeup Call to Global Markets
Adam S. Posen (PIIE) May 31, 2019
President Donald Trump’s plan to impose a 5 percent tariff on all imported goods from Mexico beginning June 10 raises a danger to the US and global economies well beyond his tariff measures to date. This should be a wakeup call to financial markets.

The African Continental Free Trade Area Is Coming into Force. Is It Really?
Anabel González (PIIE) May 31, 2019
At a time when major countries are erecting barriers and disentangling from the global economy, a very different message is coming from Africa, where countries are putting in place the largest free trade area in the world in terms of membership.

Stop Trump on Trade
Michael R Bloomberg (Bloomberg View) May 31, 2019
Congress should rein in the president’s trade-policy powers before it’s too late.

Trump’s Threatened Mexico Tariffs: Credible, Irrational, Doomed
Karl W Smith (Bloomberg View) May 31, 2019
The president could be thinking they help his ongoing battles elsewhere over trade and interest rates.

Trump Risks Throwing Manufacturers Offline
Brooke Sutherland (Bloomberg View) May 31, 2019
Tariff threats and escalating trade tensions threaten to wreck manufacturers' hopes of prolonging a sales recovery.

Trump's Mexico Tariffs Are Borderline Crazy
David Fickling (Bloomberg View) May 31, 2019
Beyond the obvious economic damage, the move would threaten the U.S.’s stature as a diplomatic partner globally.

Has a No-Deal Brexit Become More Likely?
Anatole Kaletsky (Project Syndicate) May 31, 2019
Fanatical Brexiteers argue that a UK prime minister genuinely determined to deliver a no-deal Brexit could, and should, go nuclear: suspend parliament and refuse to call MPs back until after the October 31 deadline, when Brexit will happen automatically. The problem for them is that the UK isn't Zimbabwe or Venezuela.

Why the Trade Arithmetic Favors China
Kaushik Basu (Project Syndicate) May 31, 2019
US President Donald Trump’s decision to increase tariffs on Chinese goods risks disproportionately harming the US economy. Besides raising prices for American consumers, higher tariffs will make key production inputs more expensive or scarcer – seriously damaging US productivity and competitiveness in the long run.

How Do Populists Win?
Daron Acemoglu and James A. Robinson (Project Syndicate) May 31, 2019
At first blush, a populist message of "us vs. them" might seem less effective than a message of "all of us together," given that elections are won with broad coalitions. But under conditions of widespread alienation and distrust, the political gamble of an exclusionary, anti-pluralist message can pay off big.

The Populist Paradox
Simon Johnson (Project Syndicate) May 31, 2019
When anti-establishment populists come to power, they implement a range of policies that lead to lower economic growth and fewer good jobs. And yet the angrier people become, the easier it is to persuade them that the media are biased, the experts are always wrong, and the facts are not the facts.

How Central-Bank Independence Dies
Kenneth Rogoff (Project Syndicate) May 31, 2019
Since the world’s major central banks came to the global economy’s rescue in 2008, they have had more and more tasks foisted upon them, even as some politicians question their expanded role and others seek to undermine their policymaking autonomy. To escape this dilemma, monetary authorities must get back to doing what they do best.

Trump Starts a New Trade Fight in the Middle of an Old One
Keith Johnson (FP) May 31, 2019
U.S President Donald Trump’s new threat to levy tariffs on all Mexican imports until migration across the southern border drops beneath an unspecified target is bound to have consequences. Among them could be a closer bond between China and Mexico, another U.S. recession, and damage to Trump’s reelection chances in 2020.

Trump’s Mexico Tariff Is Stoking a Wall Street Meltdown
John Cassidy (New Yorker) May 31, 2019
The President believes that he can bully anybody and act arbitrarily without suffering consequences. This theory is about to be tested.