How Shanghai’s Free Trade Zone Works
SHANGHAI | By Hu Shuli at Caixin | In an interview, Shanghai party leader Han Zheng describes the painstaking steps that preceded the Shanghai FTZ’s recent launch.
World economy
Yellen On Tapering: Not Quite There Yet
NEW YORK | By Ana Fuentes | Thursday was Janet Yellen’s big day. In front of the Senate Banking Committee she ran through her prepared speech (released by the Fed on Wednesday) and acknowledged “the risks” of injecting QE steroids to the U.S. economy for too long. However, she argued, inflation is still too low and unemployment rate, too high. “The benefits exceed the costs” of the Fed’s current policies, she said. Will we see any tapering soon? Certainly, but not yet.
‘IMF expects extra dose of austerity for 2015’
LISBON | By Diário de Notícias via Presseurop | The International Monetary Fund (IMF) believes that austerity measures taken until now are sufficient to fulfill the deficit targets set for this year and the next, but anticipates more cuts for 2015, writes Diário de Notícias.
The low quality of some Fed Governors and the freedom to “speak-out”!
SAO PAULO | By Marcus Nunes | It is encouraging that Obama may soon have to fill up to 5 slots in the Board of Governors of the Federal Reserve. Maybe it´s expecting too much that he´ll think that´s a very important thing to happen at times like the present. He´s already ‘failed’ in a previous instance when he had 3 slots to fill, leaving them open for a long time and even failing to get an appointee approved! The low quality of some recent Fed Governors is glaring.
Our Daily Cartoon: Preparing For the Worst
U.S. Economy: Shadow rates for an economy that is a ‘shadow of its former self’
SAO PAULO | By Marcus Nunes | Professor of Economics James Hamilton reviews new research on “Summarizing monetary policy.” He talks about the existence of a “shadow” short-term interest rate in the U.S. economy that might in some circumstances be quite negative.
U.S. Credibility to Europeans (After a Government Shutdown and a Spying Scandal)
MADRID | By Adrianna Rodriguez* | The past year has been rocky for the United States, to say the least: Edward Snowden released the most significant leak in recent history; German leaders now think twice about their after hours phone calls, and the US spent about $24 billion on a national tantrum. It’s simpler to say that the country has finally lost all credibility in European eyes, however, that’s not necessarily the case. How is it that Washington can go through all this nonsense and still appear on top?
Consumer confidence has a short memory in the U.S.
LONDON | By London analysts | Since the end of the most recent recession, US consumer confidence has remained on an upward trend, despite several negative shocks from government policy. Given this track record, we expect the fall in confidence related to the federal shutdown to be short-lived.
How Will China’s Communist Party Meeting Play Out- According to JP Morgan
BEIJING | By Caixin Magazine | The third plenum of the Communist Party’s 18th Central Committee will start on November 9. Hopes are high that significant reform measures will be unveiled after the meeting. Here is what Zhu Haibin, chief China economist at investment bank JPMorgan, expects to see. He also explains why the success of the meeting will be determined by what comes next.
ECB Cuts Key Rate to the Bone- Buckle Up!
THE CORNER TEAM | Put the champagne in the freezer. Against most expectations, the ECB lowered its main refinancing rate to 0.25 percent on Thursday in order to encourage the eurozone’s recovery. Mario Draghi took this measure responding to a slump in inflation that has sparked fears the economy could stall, years after financial crisis broke and years after most other central banks did the same thing.