Trade and Jobs: Why the Protectionist Cure Could be Worse Than the Globalization Disease

Trade and Jobs: Why the Protectionist Cure Could be Worse Than the Globalization Disease

photo: Steven Straiton Dramatic promises to restrict international trade were a signature element of Donald Trump’s presidential campaign. So far, he seems to be following through, with an early reaffirmation of his intent to withdraw US participation in the Trans-Pacific Partnership (TPP). An aggressive stance on trade played a key role in gaining the support of […]

Mr. Trump: Can You Deliver it?

Mr. Trump: Can You Deliver it?

U.S. assets reacted in a see-saw fashion to Donald Trump’s victory. Stock futures first dove deeply before climbing up to strong gains as investors developed a view on what kind of economic policy president-elect Trump is likely to pursue. They seem to be pricing in an expectation of higher growth and inflation, as well as […]

Modigliani and Miller at the IMF

Modigliani and Miller at the IMF

In a paper on tax policy, leverage and macroeconomic stability published on 10 November, the IMF staff address the issue of excessive leverage or the so-called “debt bias” that poses risks for financial and macroeconomic stability. The “debt bias” has been largely created by more favorable tax treatment of debt relatively to equity. In most […]

After The Trump Triumph

After The Trump Triumph

photo: Gage Skidmore The Trump victory was a “stunning surprise” to Washington and mainstream media.  But it was very much in line with voter distrust in both Clintons and Washington’s ruling class. Politically, Americans are fed up. In cooperation with the Democratic National Committee, the Clinton campaign had far too cozy ties with Wall Street, neoconservatives […]

US 2016: Fight for Leadership Begins After the Election

US 2016: Fight for Leadership Begins After the Election

After the bizarre 2016 election, Washington faces a slate of investigations and a gridlock. Internationally, threats include new Cold War(s). Depending on the outcome, the election could even be contested. If Hillary Clinton wins, she will flash her broad smile like Alice in the Wonderland, with Vice President Tim Kaine, Bill and Chelsea on her […]

Election Time: Will Populism Block Effective, Needed Policies?

Election Time: Will Populism Block Effective, Needed Policies?

  Key takeaway – The global economy is stagnating, financial markets are jittery and citizens disfranchised. Effective policy options are available, but – alas – most are not politically viable. Over the next 12 months, key elections will take place in the US, France and Germany and a constitutional referendum in Italy. Populist parties are […]

BlackRock Report Unpacks ‘Brexit’

BlackRock Report Unpacks ‘Brexit’

(Boris Johnson, the Conservative mayor of London and freshly minted Brexit partisan, contemplates the liminal space between ‘inside’ & ‘outside’.) [Photo credit: David Holt]   Americans who follow business and financial news know that a Brexit, the potential exit of Britain from the European Union, could have a major impact on the global economy. But the detailed mechanics of […]

Funds & Fire Sales

Funds & Fire Sales

Earlier today, The New York Fed’s Liberty Street blog posted a disconcerting article about the risks that open-end funds, such as mutual funds and hedge funds, can experience when high numbers of investors demand their money back at the same time. The post — Are Asset Managers Vulnerable to Fire Sales? — starts by debunking a […]

Fed Agrees — On Uncertainty

Fed Agrees — On Uncertainty

photo: doug turetsky Fed minutes from the January 26th & 27th policy meeting released earlier today could be summed up, to a first order approximation, as expressing uncertainty, with a bias to the downside. To wit, from the Current Conditions and the Economic Outlook: “Participants discussed whether their current assessments of economic conditions and the medium-term […]

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