Global Macro Channel: Latest Posts
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Global Macro
Markets Calmer into Weekend
The global capital markets are calmer and the US dollar is somewhat firmer, as the volatile week draws to a close. With the help of a Wall Street Journal article, more participants have come over to our view that talk of tapering by the Federal Reserve as early as next week is premature and exaggerated. [...]
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Global Macro
Comment on Fiscal Consolidation of G7
1,006 billion dollars. This is not the value of the GDP of a middle-income country, but the amount of resources that the United States will have to find in the coming years if they want to successfully achieve their fiscal consolidation target. According to some recent estimates by the International Monetary Fund, the US Treasury [...]
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Global Macro
Bankrupt Sovereigns: Is There An Orderly Way Out?
The International Monetary Fund (IMF) is taking a new look at Sovereign Debt Restructuring. There are at least two major reasons for this: First, it is expected that official creditors play a unique role during sovereign debt crises, since lending of last resort becomes the only bridge over default and/or drastically forced adjustments when a [...]
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Thoughts From Across the Atlantic
Smithfield-Shuanghui Foods: Is It The Future For U.S.-China Relations?
Acquisition of Smithfield Foods by Shuanghui The Chinese firm, Shuanghui International has offered to buy the major pork producer, Smithfield Foods. The major shareholders of Smithfield, including Continental Grain, favor the offer, and the offer has been structured to appeal to current employees and management. The prospective owner promises no closing or relocation of present [...]
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Global Macro
‘Global Spillovers and Economic Cycles’
That was the title of an illuminating EABCN/CEPR/Banque de France/European University Instituteconference I attended last week (organized by Philippe Bacchetta, Laurent Ferrara, Jean Imbs, andMassimiliano Marcellino). The program is here, and papers here. The conference call described the focus: In an increasingly integrated global economy, assessing the propagation of shocks is becoming of major interest to the international economic cycles analysis. [...]
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Global Macro
Managing Innovation
Begin by Defining Outcomes, Outputs and Inputs Innovation is the buzz word du jour. Each year, vast piles of PowerPoint handouts are distributed to cultivate and fertilize innovation — many containing concepts (figuratively speaking) with the aroma of manure. Innovation is difficult, but presenting it as an obscure unmeasurable esoteric art does not make it easier. [...]
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Global Macro
Money-Financed or Bond-Financed Fiscal Stimulus?
Many governments are experiencing malfunctioning macroeconomic policies. There is growing recognition that the austerity policies adopted in Europe are not delivering lower public debt burdens, increased confidence, higher economic activity or sufficiently lower relative prices in the uncompetitive countries. Pressures are mounting on that continent for pro-growth macroeconomic policies. On the other side of the [...]
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Global Macro
‘DSGE + Financial Frictions = Macro that Works?’
This is a brief follow-up to this post from Noah Smith (see this post for the abstract to the Marco Del Negro, Marc P. Giannoni, and Frank Schorfheide paper he discusses): DSGE + financial frictions = macro that works?: In my last post, I wrote: So far, we don’t seem to have gotten a heck of a lot [...]
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Global Macro
Honest Economics
Can you be wrong a thousand times? You can, if your reasoning is based on media concoctions, wherein some events receive excessive and biased coverage and other, less sensational events are ignored, according to the whims of advertising contracts. What sells is the information “commodity” supposedly expected by the undiscerning public: sensations interlaced with commercials. [...]
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Global Macro
Helicopter Money Debate: Lord Turner and Professor Woodford
A debate on helicopter money was held at the London Business School in April 2013 involving Lord Adair Turner and Professor Michael Woodford. An account of that important debate is included in an article ‘Helicopter money as a policy option’, at VoxEU.org, dated 20 May. In that debate the ‘Helicopter Money Financing model’ was compared [...]
