The Great Bipartisan War on Free Trade
Like most economists, I am strongly inclined toward free trade. I cringe to see the way free trade is under attack, from both parties, during this primary season. The two populist candidates are the worst offenders. Bernie Sanders, whom I support on many other issues [1] [2] [3], goes off the rails when it comes ... Read more
BIS: Daily FX Turnover Averages $5.3 Trillion
The Economist drew from the latest survey of the Bank of International Settlements to create this Great Graphic that shows the average daily turnover of the top 16 currencies. Source: The Economist Average daily turnover is a mind-numbing $5.3 trillion. In three days foreign exchange turnover is sufficient to cover world trade in a year. The BIS conducts the survey ... Read more
The New Economic Nationalism, Part 1: A ‘Juche’ World
Commentators often assume that relatively unfettered trade in goods and services and free movement of capital are givens, but the drive toward greater economic openness could now be undergoing a reversal, with profound implications for the global economy. This piece, the first of a two-part series, looks at the drivers of this shift. Globalization reached ... Read more
It’s the Exchange Rate, Stupid
Eurostat released trade figures today, where the trade balance (exports less imports) surged €3.7 bn in the month of June (link to the .pdf release). The current figures imply a 2012 annualized trade balance of €66.9 bn, which is a meaningful boost to the -€7.4 bn deficit in 2011. Eurostat breaks down the regional figures further into intra-Euro ... Read more
World Trade Turning Down
Something different for today: world trade. Recently, South Korea and Taiwan released July 2012 trade statistics, where annual export growth was seen contracting at a 8.8% and 11.6% rate, respectively. The annual pace of export growth in Taiwan contracted for the fifth consecutive month, where that in South Korea turned negative following a 1.1% annual ... Read more
Euro Area Imbalances Are a Symptom of the Broader Global Imbalances
Every year I travel to Germany to visit my in-laws, which is where I am now. Given the extra time on my hands, I’ve now mulled over a June 2012 NY Times opinion piece by Gunnar Beck. Beck displays an interesting medley of data in support of his view that Germany cannot afford to backstop ... Read more