By Richard Alford, a former economist at the New York Fed. Since then, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side. The G-20 statement contained seven principles to guide policy during the balance of the crisis period. However, the agreed […]
Read more...By George Washington of Washington’s Blog . Daniel Gross points out that part of the reason that the American stock markets are going up even though unemployment is rising and the real economy suffering is because multinational corporations headquartered in the U.S. are experiencing strong sales abroad: Here’s a puzzle: The stock markets are doing […]
Read more...By Richard Alford, a former economist at the New York Fed. Since them, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side. The need to address and prevent future large global economic and financial imbalances is back on center stage, but […]
Read more...The “economy is recovering” story is not reflected in traffic at LA area ports (LA and Long Beach, which combined are the fifth largest in the world). The outlook for the shipping industry is even worse on the whole than for traffic volumes, since many carriers did not cut equipment orders. And while shipments are […]
Read more...Wolfgang Munchau, in today’s Financial Times, makes the case that a certain amount of dollar weakness is a good thing and consistent with global rebalancing. On one level, this is a sensible and defensible view. But this view is implicitly based on the idea that the dollar will somehow find its “correct” level, more or […]
Read more...A Bloomberg headline tonight is uncharacteristically alarmist: “Dollar Reaches Breaking Point as Banks Shift Reserves.” However, while the article is correct to point to lack of enthusiasm for the dollar, it presents, but then fails to integrate, a key point: foreign central banks are not cutting dollar holdings. In fact, they are still increasing buying […]
Read more...Whoops, that was the old brand, and it was to be led by Japan. The results were less than happy since Japan was not prepared to take “no” for an answer. But this time around, necessity as well as opportunity are leading China, Japan, and Korea to discuss moving forward on closer economic ties. In […]
Read more...An unannounced but evidently coordinated effort to arrest or at least slow the fall of the dollar is underway. The Financial Times indicated that Asian central banks were aggressive dollar buyers on Thursday, but the information came via currency traders rather than an official pronouncement. Thailand, Malaysia and Taiwan made substantial purchases; Hong Kong and […]
Read more...When Jim Rogers taught classes at Columbia, he liked to tell students that the US had a proud history of implementing capital controls, and warned them against going on the merry assumption that it would ever and always be easy to make cross-border investments. For instance, taxes on foreign securities transactins are a soft form […]
Read more...Submitted by Edward Harrison of Credit Writedowns I have to admit to hyping the debate now swirling about protectionism. I believe that tariffs are not a very good solution to a trade problem as they are likely to result in retaliation and/or escalation. Moreover, they end up protecting small groups at the expense of higher […]
Read more...This post has been deleted temporarily because it appears to be corrupting the RSS feed. It will be restored once we have isolated the problem.
Read more...It would be better if we were not proven correct on this one, but when the US imposed stiff tariffs on imported tires from China late on Friday, we noted, “This could get interesting in a bad way.” The Chinese responded quickly over the weekend to announce they were investigating US auto parts and chicken, […]
Read more...The US tonight imposed steep tariffs on tires, a move directed against Chinese imports. From the Wall Street Journal: The Obama administration will put steep import duties on Chinese passenger and light truck tires, responding to what the U.S. International Trade Commission determined to be a surge of Chinese tire exports that has rocked the […]
Read more...When trade volumes tanked in the later part of 2008, quite a few observers expected a rise in protectionism. We haven’t seen a Smoot-Hawley analogue, a wide ranging measure that elicits retaliation. But that does not prevent policy makers from more targeted forms of gamesmanship. Trade has retreated from front-burner coverage due to the modest […]
Read more...While the G-20 agreement to move forward with a coordinated approach to bank capital rules and employee incentive payments is progress, it is important to recognize that what took place was effectively an apple pie and motherhood statement. The one stake in the ground was the commitment to make Tier 1 Capital a key metric. […]
Read more...