I’m intrigued when a commentator gives high praise to a work by someone who comes from a political vantage different from his own. I get even more interested when another take on the same piece seems straight out of Rashomon, a radically different account with only a few facts in common. The opus in question […]
Read more...It’s hard to read the tea leaves of the European Union at such a remove, but a public show of disagreement, even if done politely, is not an everyday spectacle. Frances’ finance minister Christine Lagarde urged central bankers to alleviate currency misalignment. This is mainly code for “do something about the pricey euro” but is […]
Read more...Why is it that some ideas capture the popular imagination and others die on the vine? A lot has to do with timing, getting noticed by opinion leaders, having a pithy turn of phrase. Yet I’ve seen articles and books that (at least to me) make fundamentally important observations and go nowhere, and others which […]
Read more...What would we do without Brad Setser to give us a hard, analytical look at trade and international funds flows? Setser tells us that the headline news on the trade deficit, namely, that it shrank in March, is misleading. When you dig deeper, and in particular pull out petroleum-related flows, it reveals that real export […]
Read more...Sometimes I wonder if I am too critical of the punditocracy. But much should be expected of Larry Summers, former Treasury secretary and Harvard economics professor, yet many of his comment pieces in the Financial Times, which command considerable attention, appear to come up short. Consider his current offering “A strategy to promote healthy globalisation.” […]
Read more...Larry Summers, in “America needs to make a new case for trade,” worries, as do many others, about rising protectionist sentiments: In a world where Americans can legitimately doubt whether the success of the global economy is good for them, it will be In a world where Americans can legitimately doubt whether the success of […]
Read more...Alliance: When two thieves have their hands so deeply plunged into each others’ pockets that they cannot separately plunder a third party. Ambrose Bierce, The Devil’s Dictionary The US and China bicker like an unhappily married couple, but Brad Setser warns us that the squabbling is getting nastier. And worse, both parties seem to fail […]
Read more...Carmen Reinhart has provided a synopsis of a paper she did with Kenneth Rogoff looking at financial crises over a longer time frame than most analyses, which have limited themselves to recent history (the economist’s version of the drunk looking under the street light for his keys because that’s where the light is good, as […]
Read more...Paul Krugman, commenting on a Wall Street Journal article that invoked, then tried to dismiss, concerns about resource scarcity, defended Malthus: Malthus was right about the whole of human history up until his own era. Sumerian peasants in the 30th century BC lived on the edge of subsistence; so did French peasants in the 18th […]
Read more...Dani Rodrik provides us the introduction to a new paper (co-authored with Arvind Subramanian), “Why Did Financial Globalization Disappoint?” which argus that financial liberalization. meaning making their economies more open to international capital flows, has not been a boon for developing economies. It has not produced not better growth and has increased volatility (think of […]
Read more...Brad Setser, a source for thorough, thoughtful coverage on currencies and related topics, provides his monthly parsing of the Treasury International Capital report (this one from January, plus its survey of foreign holdings of US securities as of the end of June 2007) and does not like what he sees. Since the August TIC report, […]
Read more...Quite often, policy debates get mired in superficial, outdated, manipulated, or simply incomplete understandings of the facts. Getting relevant data is vital to coming up with intelligent approaches. Unfortunately, Paul Krugman, who has tried getting to the bottom of whether trade has increased income inequality in the US, concludes that we don’t have the right […]
Read more...A number of commentators (see here and here) have taken note Warren Buffett’s favorable remarks in his much-anticipated annual letter to Berkshire Hathaway shareholders on sovereign wealth fund investment in the US. What I found far more significant was his somewhat-longer-form observations about how we had gotten ourselves in the situation where SWF-type capital inflows […]
Read more...Economist Thomas Palley has of late been discussing what he believes to be an insufficiently-acknowledged cause of our current financial woes, namely, a shift in government policy away from emphasizing wage growth as a key objective. Another shift was a lack of concern about trade deficits. Now one can argue that combatting trade deficits means […]
Read more...In “We must curb international flows of capital,” Dani Rodrik and Arvind Subramanian make what many might consider to be a radical argument: too much money sloshing around internationally leads to trouble. It’s not quite a hot money argument (unstable and rapidly moving investments were the proximate cause of the 1997 emerging markets crisis). Instead, […]
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