J.P. Marín Arrese | PM Pedro Sánchez will govern backed by a weak minority party. There will be little respite from either those who voted for him or those who voted against him. No one expects the new Spanish government can deliver any substantive policies. Yet, such an isolated and weak position can also be a valuable asset.
Articles by JP Marin Arrese
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The 2018 budgets predict very optimistic increases in revenues (+6% in some taxes). But there is no real risk of non-compliance if spending remains tightly controlled.
In his first press conference, Jerome Powell baffled both the experts and the markets. After reading the hawkish introductory statement, he defused all fears for a harsh and swift monetary tightening.
By issuing digital money, the central banks could provide an answer for the substitution of jobs by robotization, or solve the problem of excessive public debt, easing the increasing pressure on finances from burdens like pensions.
In his first congressional testimony, Jerome Powell delivered an upbeat appraisal of the US economy. In his own words, headwinds have turned into tailwinds. While avoiding any commitment on the plausible monetary stance, markets have discounted a faster pace in rate hikes, pushing bond yields to fresh highs.
Many argue that Spain lacks a proper government, with the one in office proving unable to secure parliamentary backing for the 2018 general budget.
Jerome Powell is bound to have a crash landing in the Federal Reserve. From the very beginning of his mandate, pressure is mounting on him to raise rates. An unpalatable choice for someone who hoped to follow Janet Yellen’s wait-and-see stance for as long as he could.
The Spanish Parliament has set up a special Committee to scrutinise what led to the financial crisis ten years ago. But the craving for finding individual culprits will overrun any reasonable attempt to search for the simple truth that no one could foresee the crisis.
The trend in inflation is confusing those in charge of monetary policy. After a significant uptick in the last part of 2017, it has really stagnated, in stark contrast with the growing dynamism of the economy.
Ever since the nationalists in Catalonia flared a low key rebellion against Madrid, the region seems close to the world depicted by Aldous Huxley. They are attempting to create a brand new life, erasing all Spanish vestiges from early childhood onwards.