Economies

  • Taking Stock After 10 Years: The Lehman Brothers Bankruptcy
    Taking Stock After 10 Years: The Lehman Brothers Bankruptcy
    September 13, 2018 | By Emel Akan
    Sept. 15 marks the 10th anniversary of the collapse of Lehman Brothers, which had unprecedented ramifications worldwide. Painful lessons have been learned, but the debate continues among economists about whether the crisis could have been handled better. Lehman was the fourth-largest U.S. investment bank before it filed for bankruptcy. With $639 billion in assets, it was the biggest bankruptcy in […]
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  • Recovery From Financial Crisis Limps On 10 Years After Lehman Brothers Bankruptcy
    Recovery From Financial Crisis Limps On 10 Years After Lehman Brothers Bankruptcy
    September 12, 2018 | By Rahul Vaidyanath
    Sept. 15, 2018, marks the 10-year anniversary of the bankruptcy of U.S. investment bank Lehman Brothers—the one event most closely associated with the onset of the global financial crisis.
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  • Crypto Exchanges Embrace Controversial Practices as Demand Eases
    Crypto Exchanges Embrace Controversial Practices as Demand Eases
    September 11, 2018 | By Bloomberg
    With digital-currency trading volume having plunged, some of the biggest crypto exchanges are turning to unorthodox practices to boost activity and win market share. Bitfinex, FCoin, and OKex are encouraging startups to drive depositors to their online-trading platforms to get coins listed. Other exchanges, such as Binance and KuCoin, are embracing listing fees that can […]
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  • Money Means More Than Dollars
    Money Means More Than Dollars
    September 10, 2018 | By Jeffrey A. Tucker
    I needed to stay overnight in a hotel in a New Jersey town and had no time for shopping. I pulled up the travel app I use by habit. The first option was perfect. The price was zero dollars. Wait, zero? How can I stay in a nice hotel overnight and pay absolutely nothing for […]
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  • Tax Reform Boosts Economic Growth and Paychecks
    Tax Reform Boosts Economic Growth and Paychecks
    September 9, 2018 | By Emel Akan
    WASHINGTON—The full benefits of tax cuts will take years to realize, but the reductions already have helped spur business investments, as well as economic growth and wages, according to experts. The gross domestic product (GDP) climbed above 4 percent in the second quarter and wages finally started to rise, after having lagged behind job growth. In […]
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  • The Forgotten Tax on the Poor
    The Forgotten Tax on the Poor
    September 9, 2018 | By Phil Magness
    The Great Depression is usually remembered for introducing extremely high progressive federal income taxes. This shift began as a misguided revenue measure by Herbert Hoover, who raised the top marginal rate to 63 percent in 1932, from 25 percent, in a failed attempt to combat growing budget deficits. But Franklin Delano Roosevelt made the progressive tax […]
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  • US Weekly Jobless Claims Drop to Near 49-Year Low
    US Weekly Jobless Claims Drop to Near 49-Year Low
    September 7, 2018 | By Reuters
    WASHINGTON—The number of Americans filing new claims for unemployment aid fell to near a 49-year low last week and private payrolls rose steadily in August, pointing to sustained labor market strength that should continue to underpin economic growth. The economy so far appears to be weathering an escalating trade war between the United States and […]
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  • Zero Tariffs Help American Workers
    Zero Tariffs Help American Workers
    September 6, 2018 | By Emel Akan
    WASHINGTON—President Donald Trump’s stated goal of zero tariffs, zero non-tariff barriers, and zero subsidies in international trade will boost U.S. auto jobs, according to industry experts and economists. In the long run, however, they warn that additional tariffs on steel and aluminum or automotive products will hurt workers and consumers. At a hearing on Sept. […]
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  • Meet the ‘Edgy’ Man Who Could Replace Mario Draghi
    Meet the ‘Edgy’ Man Who Could Replace Mario Draghi
    September 6, 2018 | By Bloomberg
    In the tussle between the euro zone’s north and south, Erkki Liikanen may boast just the right credentials to become the next president of the European Central Bank. The former governor of Finland’s central bank is the new frontrunner in a Bloomberg survey of economists on who’ll succeed Mario Draghi in November 2019. His chief […]
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  • Home Ownership in Canada Declines, Reversing Long Upward Trend
    Home Ownership in Canada Declines, Reversing Long Upward Trend
    September 6, 2018 | By Rahul Vaidyanath
    Home ownership in Canada fell for the first time in over 45 years, according to a Point2Homes study.
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  • Fallacies Plague Modern Monetary Theory on Sovereignty
    Fallacies Plague Modern Monetary Theory on Sovereignty
    September 5, 2018 | By Daniel Lacalle
    In this era when there are many undocumented and misguided views on monetary policy, there is one that’s really infuriating: modern monetary theory science fiction. One of its main principles is based on a fallacy: “A country with monetary sovereignty can issue all the debt it needs without default risk.” First, that is untrue. A […]
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  • US Wage Growth Is Higher Than Government Estimates, White House Says
    US Wage Growth Is Higher Than Government Estimates, White House Says
    September 5, 2018 | By Emel Akan
    WASHINGTON—White House economic advisers have challenged the traditional measures of wage growth, claiming that pay increases are actually higher than government estimates. A report released by the President’s Council of Economic Advisers (CEA) shows that official wage statistics often miss real wage growth because they exaggerate inflation and fail to account for additional employment benefits, […]
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  • Labour Shortage Is the ‘New Norm’ That Will Last a Decade: BDC Economist
    Labour Shortage Is the ‘New Norm’ That Will Last a Decade: BDC Economist
    September 5, 2018 | By The Canadian Press
    TORONTO—Canada’s small- and mid-sized companies must find ways to adapt to a “new norm” of worker shortages that will likely persist for a decade, says Pierre Cleroux, chief economist for the Business Development Bank of Canada. “They represent about 50 percent of the Canadian economy, so they are very important. Also, they are very important […]
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  • Bank of Canada on Hold as Trade Uncertainty Weighs on Solid Fundamentals
    Bank of Canada on Hold as Trade Uncertainty Weighs on Solid Fundamentals
    September 5, 2018 | By Rahul Vaidyanath
    The Bank of Canada kept rates unchanged on Sept. 5, as NAFTA uncertainty remains the primary risk to an economy that is moving in the right direction.
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  • Saudi Private-Sector Growth in August Is Fastest This Year: PMI
    Saudi Private-Sector Growth in August Is Fastest This Year: PMI
    September 4, 2018 | By Reuters
    DUBAI—Growth in Saudi Arabia’s non-oil private sector edged up in August to its fastest rate this year, a survey of companies showed on Sep. 4, suggesting a long-awaited recovery of the economy may have begun. The economy has been hit hard in the last few years by low oil prices and government austerity, but the […]
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  • World Stocks Slip for Third Day as Trade, Emerging Market Worries Bite
    World Stocks Slip for Third Day as Trade, Emerging Market Worries Bite
    September 3, 2018 | By Reuters
    LONDON— Global stock markets fell for a third straight day on Sept. 3, hurt by worries over the escalation of trade disputes between world powers and a deepening sell-off across emerging market currencies. With U.S. markets closed for Labor Day, trading activity was generally subdued. European shares were largely flat, although London’s blue-chip FTSE rallied […]
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  • Factories Feeling the Pinch From Escalating Trade Conflict
    Factories Feeling the Pinch From Escalating Trade Conflict
    September 3, 2018 | By Reuters
    LONDON/TOKYO—Manufacturing activity took a hit from weak orders in August, surveys showed, a sign firms are feeling the pinch from an intensifying trade war between the United States and China that could derail global growth. Surveys of purchasing managers released on Sept. 3 showed mounting pressure on factories across Europe and Asia, with later data […]
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  • Argentina Unveils ‘Emergency’ Austerity Measures, Grain Export Taxes to Balance Budget
    Argentina Unveils ‘Emergency’ Austerity Measures, Grain Export Taxes to Balance Budget
    September 3, 2018 | By Reuters
    BUENOS AIRES—President Mauricio Macri on Sept. 3 announced new taxes on exports in the world’s third-biggest soy producer and steep cuts to government spending in an “emergency” bid to balance next year’s budget as his center-right government aims to persuade the IMF to accelerate a $50 billion loan program. The new austerity measures, announced by […]
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  • Brazil Inflation Seen Grinding to a Halt in August
    Brazil Inflation Seen Grinding to a Halt in August
    September 3, 2018 | By Reuters
    BRASILIA, Brazil—Consumer prices in Brazil likely stagnated in August as a slow economic recovery continued to weigh on employment, a recent poll showed, suggesting the central bank should be in no rush to raise interest rates despite a currency sell-off. The benchmark IPCA price index probably held flat compared with July, according to the median […]
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  • World Markets Themes for the Week Ahead
    World Markets Themes for the Week Ahead
    September 2, 2018 | By Reuters
    LONDON —Following are five big themes likely to dominate thinking of investors and traders in the coming week.   Missing Trade War Casualty—Jobs U.S. President Donald Trump’s tariff war has cast a shadow over all economic data releases lately, including the biggest market-mover of them all: the U.S jobs employment report. Aug. 30 offers a […]
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  • Schroders Says the Worst May Have Passed for Indonesia’s Markets
    Schroders Says the Worst May Have Passed for Indonesia’s Markets
    September 2, 2018 | By Bloomberg
    The worst may be over for Indonesia’s markets, according to the country’s biggest mutual fund manager. The rebound in private consumption seen in the second quarter may keep going as the government maintains support to sustain the momentum, says Irwanti, director and portfolio manager at PT Schroder Investment Management Indonesia. The fund manager, who goes […]
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  • Italy Could Be Shut out of ECB’s Control Room After Draghi Era
    Italy Could Be Shut out of ECB’s Control Room After Draghi Era
    September 2, 2018 | By Bloomberg
    Italy could soon find itself excluded from the heart of euro-area monetary policy for the first time in the currency’s two-decade history. European Central Bank President Mario Draghi’s eight-year term ends in October 2019 and his country has no automatic path to a seat on the Executive Board after that. Instead, its populist leaders must […]
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  • Italians Come Before Ratings Agencies, Deputy PM Says
    Italians Come Before Ratings Agencies, Deputy PM Says
    September 2, 2018 | By Reuters
    MARINA DI PIETRASANTA, Italy—Italy’s populist government will make a “historic choice” between what citizens need and what ratings agencies say should be done, the deputy prime minister said on Sept. 2, responding to Fitch’s cutting the outlook on Italian debt. Fitch on Aug. 31 changed the outlook on the world’s third-largest pile of state borrowing […]
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  • Central Bank Meeting Confirms Need for Further Tightening
    Central Bank Meeting Confirms Need for Further Tightening
    September 2, 2018 | By Daniel Lacalle
    If we analyze the consensus expectations of analysts and investment banks at the end of 2017, the conclusion was unanimous: buy Europe and emerging markets against the United States, amid weakening dollar estimates in 2018. It has been exactly the opposite. We’ve already warned a few times about the risk of such a biased consensus […]
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  • Argentina Hikes Interest Rate to 60 Percent, Peso Plunges
    Argentina Hikes Interest Rate to 60 Percent, Peso Plunges
    August 30, 2018 | By The Associated Press
    BUENOS AIRES, Argentina—Argentina’s Central Bank on Aug. 30 increased its benchmark interest rate to 60 percent—the world’s highest—in an effort to halt a sharp slide in the value of the peso, which plunged to a record low. The peso fell more than 13 percent against the dollar on Aug. 30, closing at an all-time low […]
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  • Trump Cancels Planned Pay Increases for Federal Employees
    Trump Cancels Planned Pay Increases for Federal Employees
    August 30, 2018 | By Holly Kellum
    President Donald Trump, citing “our nation’s fiscal situation,” announced that a pay boost for civilian federal employees that was to begin in January won’t go into effect. Under the current law, federal employees would have gotten an across-the-board increase of 2.1 percent starting in January 2019. Employees who also get an adjustment based on their […]
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  • Struggling China Desperately Seeks Canada Trade Lifeline
    Struggling China Desperately Seeks Canada Trade Lifeline
    August 30, 2018 | By Rahul Vaidyanath
    In a desperate move, Beijing is now trying to revive free trade talks with Canada even after one of its state-owned construction firms was barred from acquiring one of Canada’s largest infrastructure companies.
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