The Fed Is More Like The ECB 2011 Than Fed 1937
In an attempt to out-macho the US and impress Germany , the ECB under Trichet decided to stamp on headline inflation hitting nearly 3% in early 2011, while core remained solidly below 2%.
World economy
What’s Next For The China-Africa Nexus?
Yishu Zhou | The latest Forum on China-Africa Cooperation (FOCAC), held last December in Johannesburg, South Africa, was monumental for a number of reasons—not least Chinese President Xi Jinping’s unveiling of an unprecedented $60 billion development and investment deal in aid of Africa over the next three years.
Much Has Changed Since Short Sellers Last Attacked HK Dollar
Vincent Chan via Caixin | The Hong Kong dollar has been under pressure recently. On January 20, the value of the currency plunged to an eight-year low of 7.8228 to the U.S. dollar. Meanwhile, the stock market’s benchmark Hang Seng Index fell 3.8 percent from the previous day to 18,886.3, the lowest level in 42 months.
Will It Be Enough If There Are No Fed’s Rate Hikes In 2016?
Marcus Nunes | The answer is that much more is needed, especially since lately we´ve had the Fed and the ECB/BoJ pulling in opposite directions. Some policy coordination would greatly increase their productivity.
Negative Rates – Naughty Or Nice?
UBS | The Bank of Japan has now fearlessly (sort of fearlessly) embraced negative interest rates. The negative rates will not be comprehensively applied in Japan, but yet another central bank has broken through zero. Rates are, or have been, negative in Japan, the Euro area, Switzerland, Sweden and Denmark. From an economic point of view what does this mean? There are good and bad aspects to negative interest rates.
Central Bank Props Up Offshore Yuan In Hong Kong
Li Yuqian and Yang Gang via Caixin | The offshore yuan market in Hong Kong has been shaken to the core by weeks of volatility that analysts blame on strong intervention by China’s central bank. Wild fluctuations for yuan-based interbank lending rates as well as onshore-offshore yuan spreads in Hong Kong began in January and could continue indefinitely while the People’s Bank of China defends its currency against short sellers.
The Fed Shows Class Bias ?
Benjamin Cole via Historinhas | In general, the “class glass” is a poor lens for analyzing U.S. politics and macroeconomic policies. To be sure, the nation has interest-group politics in spades, and groups are often well-financed.
How Viable Is The Alternative To Capitalism?
John Bruton | Paul Mason, the economics editor of Britain’s Channel 4 News, has written Postcapitalism: A Guide to Our Future, which offers a critique of the existing global capitalist system. He points out that capitalism is only 200 years old and has gone through many changes. Economic systems do not last forever and can sometimes collapse—suddenly and painfully. There are risks that lie ahead if the defects in the global economic system are not tackled. But what’s the other option?
The Fed Trails Behind The Curve
The FOMC statement after yesterday’s meeting failed to boost investors’ spirits. While acknowledging the US economy had faltered in the last quarter, the Fed showed no intention of switching from its current stance for the time being.
Is China Really Fighting A Currency War?
Marc Chandler via Caixin | It is fashionable to talk about currency wars. First, it was the United States who was accused of devaluing the dollar to boost exports. Then Japan with the launching of Abenomics. Now China stands accused of pushing its currency down. Is there really a currency war going on?