In The News

The New York Times: When Climate Change Becomes a Credit Problem

Jeff Nesbit December 13, 2017
This year has shown that disasters linked with climate change carry enormous economic costs, and communities that ignore the risks of climate change can expect increased upfront borrowing costs. “In a welcome but long overdue development, one of the world’s leading credit-rating agencies, Moody’s Investors Service, announced recently that it would give more weight to climate change risks in...

El País: Brussels Pushes for European Version of IMF

Claudi Pérez December 6, 2017
The European Union is proposing its own version of a bailout fund modeled after the International Monetary Fund. “With initial firepower of €500 billion, which could be boosted up to a further 20%, the new European Monetary Fund will bail out member states in exchange for reforms, as the European Stability Mechanism (ESM) has done in the past with Greece, Ireland and Portugal,” reports El País....

Project Syndicate: America’s Supply-Side Scam

Stephen S. Roach November 28, 2017
A US tax proposal delivers big tax cuts for the wealthiest citizens. US companies already pay a low effective corporate tax rate. US corporations already rank high in competitiveness. Stephen S. Roach – author, senior lecturer at Yale University and former chairman of Morgan Stanley Asia – argues the country cannot afford tax cuts that will expand the country’s large deficit. A low savings rate...

Caixin: China to Roll Out Red Carpet for Foreign Financial Firms

Peng Qinqin, Wu Hongyuran, Zhang Yu, Yang Qiaoling and Han Wei November 21, 2017
China may do more to open its financial industry to foreign investors, lifting ownership caps for banks as well as securities, funds, and futures industries, according to a team from Caixin. “Sixteen years after China agreed to liberalize foreign access to its financial sector as part of its World Trade Organization accession commitments, overseas investors still complain about barriers...

Financial Times: China’s Balancing Act on Debt Is Becoming Trickier

November 17, 2017
Some factories in China are paying workers to stay home, part of a plan to ease the nation’s serious debt levels – which has grown nearly fivefold over the past decade to $29 trillion today. “The debt, equivalent to 260 per cent of gross domestic product, has brought with it dramatic declines in credit efficiency,” explains the Financial Times. “The International Monetary Fund points out that in...

National Review: Aren’t Republicans Supposed to Care about the Deficit?

Michael Tanner November 1, 2017
In the United States, Republican candidates promise fiscal discipline and debt reduction. With a new budget resolution and plans to adjust the tax code and reduce the corporate tax rate, US political leaders are on track for annual spending deficits greater than $1 trillion, with total debt reaching $30 trillion within a decade. Michael Tanner, writing for the National Review, explains that the...

Asia Sentinel: Pakistan’s Costly Plunge Into China Debt

Salman Rafi Sheikh October 4, 2017
The Asian International Investment Bank and other Chinese banks finance One Belt One Road projects in developing nations – with more funding than from the World Bank or the Asian Development Bank combined. “While Pakistan has been receiving Chinese capital in the form of aid and loans for quite some time, the speed and scale have both increased in the wake of implementation of the China-Pakistan...