In The News

Coronavirus Roils Global Stock Markets: CNBC

Elliot Smith January 28, 2020
The rapid spread of a new coronavirus has alarmed investors, contributing to a decline in stock markets worldwide. China reports more than 2,800 cases with more than 100 deaths. For now, analysts anticipate a short-term hit for China’s economy, but much depends on how fast public health officials can contain the epidemic. “Danske Bank analysts projected that the Chinese service sector is likely...

Restoring US Fiscal Order: Project Syndicate

John B. Taylor January 25, 2020
The United States is weakening its future capability with unsustainable federal spending. The US budget deficit exceeded $1 trillion for the most recent fiscal yea, and the Congressional Budget Office anticipates the federal debt as a share of GDP increasing to at least 144 percent by 2049, and possibly higher. “The large deficit will crowd out important federal programs, including needed...

Saudi Arabia’s Aramco IPO and Peace: Ozy

Sanjay Kapoor November 28, 2019
Trade is supposed to help secure peace, though trade in oil has been linked to war. So analysts mull over Saudi Arabia’s plans for the world’s largest initial public offering. The Saudi Aramco IPO announcement followed soon after the September 14 drone attack on a refinery in Abqaiq. Investors expect stability and so Saudi Arabia, unlike the United States and Israel, did not rush to blame Iran. “...

Global Pension Crisis: Financial Times

Josephine Cumbo and Robin Wigglesworth November 26, 2019
Since the financial crisis in 2008, many central banks have implemented easier monetary policies and other tools to stimulate economic growth. Due to those efforts, the interest rates have dropped in many countries, in turn reducing investment gains and swelling debt of pension funds. In some extreme cases, such as Sweden and Switzerland, the central bank policy rate falls below zero, or negative...

5 Market Axioms Lose Reliability: Financial Times

Mohamed El-Erian November 14, 2019
Systemic changes are underway in markets, and spreading nationalism may put economic globalization on pause. Allianz economist Mohamed El-Erian warns that investors cannot depend on globalization expanding markets and efficiency, emerging economies catching up with advanced economies, robust liquidity stabilizing markets, policies limiting economic downturns, or governance supporting the global...

Microloan Problems in Cambodia: Spiegel

Vanessa Steinmetz August 19, 2019
Even small amounts of debt can contribute to lasting trouble for those living in developing nations. Vanessa Steinmetz describes the plight of a cassava farmer and father of five in Cambodia who struggles to repay a bank microloan of $3250 just before the prices of that commodity fell. He had placed a hectare of his farm as collateral, before selling other land at a loss and taking out another...

Korea to Ban Stock Short-Selling: Korea Herald

Park Ga-young August 7, 2019
Stock exchanges of many nations imposed various bans on short-selling during and after the 2008-2009 global debt crisis. Investors expecting a stock to decline borrow shares – as a hedging strategy or speculation – and then resell these to buyers who pay the market price: Further decline results in profits for the first investor while a rise can result in huge losses, explains Investopedia. South...