Readers may recall that a row between the US and Antigua over online gambling threatening to pull the WTO house down. By way of background, the US had lost a WTO case on online betting , and the Bush Administration acted under a WTO stipulation that allows it to set its own trade rules. But […]
Read more...Observers have worried that the US’s protectionist threats toward China may eventually lead to sanctions that are forbidden under World Trade Organization rules. For example, the summary of a VoxEU, “Trade frictions with china: Do western policymakers have an end game?” by Simon Evenett, published December 15, reads: If the US and EU continue down […]
Read more...This grim headline appears in the UK’s Telegaph in an article by Ambrose Evans-Pritchard (hat tip Financial Armageddon) which is well reasoned, once you get past its fire and brimestone tone. It argues that the countries with chronic balance of payments deficits are all in dubious shape and can no longer serve as demand engines. […]
Read more...The Economist put “The Panic About the Dollar” on its cover, which led to a speedy and lengthy analysis by Brad Setser who along with Menzie Chin are probably the most active and best informed bloggers on the currency beat. Although the Economist isn’t what it used to be, the two pieces (the leader and […]
Read more...Offhshoring, the practice of companies sending work overseas (whether to their own operations located in other countries or to foreign outsourcing companies) has become the new worry of the white collar class. The business media regularly reports on software development, legal research, and Wall Street grunt work being sent to India. And it seems that […]
Read more...Boy, the equity infusion in Citi was in some ways predictable, but it happened earlier than I anticipated. Guess the bank learned from its last rescue by Prince Alwaleed not to wait until they are desperate to find a suitor. Its alternative to shore up its weakening equity base was selling assets, but with many […]
Read more...Joseph Stiglitz, who was chief economist of the World Bank during the emerging markets crisis a decade ago, discusses in a Project Syndicate article (hat tip Mark Thoma) how the US is now unwilling to take the harsh medicine it prescribed back then. While this may be a revelation to some US readers, this inconsistency […]
Read more...America is getting more support in its efforts to pressure China to let the yuan appreciate. Bloomberg reports than the Bank of England’s governor Mervyn King is lining up with Jean-Claude Trichet and Hank Paulson: Bank of England Governor Mervyn King is joining Jean-Claude Trichet and Henry Paulson to demand that China allow the yuan […]
Read more...An ongoing discussion in the financial media and among economists is how to characterize the causes of the so-called global imbalances, namely, that the US is importing capital from high savings nations, primarily China, Japan, Taiwan, and the Gulf states, to fund its high consumption. Some like to focus on the “savings glut” hypothesis, which […]
Read more...Today’s dose of dealism comes from Willem Buiter, professor of European Political Economy at the London School of Economics, in his post, “Immigration as a Human Right.” As an aspiring and ultimately unsuccessful immigrant, having gotten prized and rare four-year Australian visa, but unable to pass the hurdles needed to obtain permanent residence, I am […]
Read more...At Vox EU, Shang-Jin Wei argues in “Don’t over-sell the benefits of a change in the Chinese exchange rate policy,” that the upside of an end to the dirty float of the yuan (or as he prefers, the renminbi), has been overstated. His analysis is elegant and persuasive, and the piece is colorfully written as […]
Read more...Whoever wrote the headline to former Treasury Secretary, now Harvard professor Larry Summers’ latest comment in the Financial Times did him a disservice. The lead-in, “How American must handle the falling dollar,” implies that Summers has a specific, hard-headed program. Instead, the piece offers a succinct and subtle analysis of what is wrong with our […]
Read more...John Plender in the Financial Times wrote a very solid piece, “Credit squeeze could be harbinger of a Chinese crash,” which looks at the major financial train wrecks of the past century and finds a common element: immature but rapidly growing economies acting as major global creditors. The efforts to manage the resultant imbalances lead […]
Read more...Well, I thought no one would do a deal with Bear, at least not a strategic investor sort (taking a trading position is another matter entirely). But the government controlled Chinese entity Citic appears to have done just that. Hopefully I will have more thoughtful commentary later (I am pressed for time now), but I […]
Read more...The Financial Times reports that the G-7 meetings this weekend did not even address one of the two main issues on the agenda, the dollar, and along with the concurrent IMF meetings, featured a good deal of acrimony and disarray. Exactly what you don’t need with a crisis looming. From the Financial Times: After Friday’s […]
Read more...