Category Archives: Globalization

US Sours on its Own Secretive Trade Shocker

As anticipated, citizens in the nations that the US has been pressuring to join the toxic TransPacific partnership are taking note of stiffening opposition here.

Former IMF Chief Economist, Now India’s Central Bank Governor Rajan Takes Shot at Bernanke’s Destabilizing Policies

As Bernanke is about to take leave of office, attacks on his policies are becoming louder, thanks to financial markets turmoil resulting from the Bernanke/Geithner approach to the crisis: do whatever it takes to restore as much of status quo ante as possible. The problem, of course, is that status quo ante is what got us in this mess in the first place.

Mirabile Dictu! Reid Tells Off Obama on Fast Track, Killing Toxic Trade Deals for 2014

Obama made yet another pitch in State of the Union Address for his gimmies to multinationals known as the TransPacific Partnership and the TransAtlantic Trade and Investment Partnership. Today that idea went down in flames, at least as far as getting the deals done this year are concerned.

The Empire’s New Asian Clothes – America’s Strategic Rebalance As Covert Retreat

Yves here. This article provide perspective on Obama’s unseemly anxiety to push through the toxic trade deal known as the TransPacific Partnership. the TPP is that it is a crucial part of Obama’s “pivot to Asia” strategy. One of its aims is to isolate China by creating a trade bloc that excludes the Middle Kingdom. The article below helps explain why non-military means of reinforcing US hegemony are particularly important now.

Global Dollar-Based Financial Fragility in the 2000s (Part I)

Yves here. It’s been frustrating to see orthodox economists continue to invoke the Bernanke “saving glut hypothesis” as a significant driver of the crisis. That view was rebutted in gory detail in a 2010 paper by Claudio Borio and Piti Disyatat of the BIS, “Global imbalances and the financial crisis: Link or no link?” (see Andrew Dittmer’s summary here). Not surprisingly, the orthodoxy has chosen to ignore this paper.

A new working paper by Junji Tokunaga and Gerald Epstein, “The Endogenous Finance of Global Dollar-Based Financial Fragility in the 2000s: A Minskian Approach,” builds on the perspective of the Borio/Disyatat paper. Readers should find this summary to be a straightforward, persuasive discussion of an important topic.

China Credit Worries Rise as Large Shadow Banking Default Looms

China faces the first big test of its shadow banking system, in the form of a pending default. How is it likely to fare?

Japan to US: You Can’t Railroad the Trans-Pacific Partnership

By Clive, a regular Naked Capitalism commenter and self-confessed Japan-o-phile

The headline, in a one liner, is what this article is saying. You may have to take my word for it if you’re not a Japanese reader, but read on to find out why I hope you can.

Wikileaks on the Trans-Pacific Partnership Environment Chapter: “Toothless Public Relations Exercise”

Wikileaks has thrown yet another wrench in the negotiations over the sellout-to-multinationals-masquerading-as-trade-deal otherwise called the Trans-Pacific Partnership.

Obama Lame Duck Watch: House Democrats Stymieing Trade Deal “Fast Track;” Silicon Valley Surveillance Payoff Language Published

As we discussed earlier, even though there’s abundant evidence that the Administration’s plans to push through its trade deals, the Trans Pacific Partnership and the Transstlantic Trade and Investment Partnership, are in trouble, the official messaging has been to keep pretending that the pacts are still moving forward smartly.

Administration Peddling Increasing Blatant Canards on Proposed “Trade” Deals

We’ve both written and spoken about the wildly mislabeled “trade” deals that the Obama Administration is still trying hard to conclude, despite its abject failure to meet an arbitrary deadline of year end 2013.

How Beer Explains 20 Years of NAFTA’s Devastating Effects on Mexico

Mexico is doing badly at feeding its own people, thanks to 20 years of NAFTA.

Tapering Talk: The Impact of Expectations of Reduced Federal Reserve Security Purchases on Emerging Markets

Yves here. This post is important because even though the Fed is focused on the impact of QE (and hence the taper) on the domestic economy, it’s been getting enough of a hard time from central bankers of leading emerging markets economies that it least has to feign concern credibly.

The Eichengreen/Gupta paper summarized in this post concludes that, quelle surprise, the countries most vulnerable to changes in Fed policy (which really means hot money in and outflows) are those with the biggest financial markets relative to GDP. Curiously, Eichengreen and Gupta fail to note that this means the orthodox advice to developing economies, that financial “deepening” is a Good Thing and therefore should be supported by government policy, in fact reduces financial stability and makes them even more vulnerable to the moods of fickle foreign investors.

Will Opposition in the US and Overseas Derail the Toxic TransPacific Partnership?

Given the extreme measures the Obama Administration has gone to to keep the pending trade deal known as the TransPacific Partnership under wraps, it’s hard to be certain where things stand. But like the Administration’s failed effort to have the US intervene in Syria, this has the potential to be one of those rare cases where the interests of ordinary citizens prevails.

New Zealand’s Latest Dodgy Export: Why FX Investors Should be Wary of Software Sold by Irish Company Paymark Autotrader

A dubious FX trading software operation closes down in New Zealand and sets up shop in Ireland.

Wolf Richter: French Megabank – “Germany Should Leave The Eurozone”

France’s government is struggling to stay relevant….and Groupe BPCE may have provided an answer by telling Germany to pay up or exit the Eurozone.