In The News

Shut and Down

Nayan Chanda October 25, 2013
Without good national governance, globalization could go belly up, warns Nayan Chanda, editor of YaleGlobal in his column for Businessworld. Over the protests of a few legislators, the US Congress did end a partial government shutdown and also lifted an artificial debt ceiling that allowed borrowing and payments to continue. “By pushing the US to the edge of a default and threatening the global...

Dollar, Default and Bretton Woods III

Mike Dolan October 17, 2013
The US Congress ended its impasse over lifting its debt ceiling, proceeding to pay bills and end the partial government shutdown. The uproar over what should be routine business will have repercussions: “a new world financial order may be emerging – but one possibly more dependent than ever on the United States protecting the dollar's position as dominant reserve currency,” writes Mike Dolan...

World Leaders Press the US on Fiscal Crisis

Annie Lowrey, Nathaniel Popper October 15, 2013
Leaders of the World Bank and the International Monetary Fund warn that US failure to raise a debt ceiling and make payments on its debt will disrupt a global economic recovery underway since 2009. “Participants at the meetings remained on edge, given the gravity of the threat,” report Annie Lowrey and Nathaniel Popper for in the New York Times. The bankers and economists can only speculate about...

US Debt Standoff Provokes Ire in China

Simon Rabinovitch October 14, 2013
The threat of US debt default is bolstering China’s desire to lessen the world’s reliance on the dollar, reports Simon Rabinovitch for the Financial Times. Chinese officials and analysts are angry and incredulous about US budget shenanigans, but so far are avoiding public comment or drastic moves. “With $1.3tn invested in US Treasuries, any sudden move to sell those holdings would by itself shake...

Global Consequences of US Failure to Pay Debt

October 9, 2013
Deadlock over lifting the US debt limit – arbitrary, created by Congress to control spending – is unnerving economists worldwide. A few in Congress are willing to test a bizarre theory that refusing to pay debt, thus disrupting the global economy, will win them voters’ respect and force the country to tighten spending. Analysts in the US, China and Europe do not agree. Instead, US leaders will be...

Reform and Rebalance

Nayan Chanda October 9, 2013
The US Federal Reserve Board decides monetary policy that influences interest rates at home and overseas. Since the 2007 credit crisis, the Federal Reserve has purchased bonds to inject money into the economy – a policy that lowered interest rates and prompted investors to hunt for higher returns overseas. With slow improvement in the economy, many investors began thinking about returning to US...

Our Democracy Is at Stake

Thomas L. Friedman October 4, 2013
A Republican plan to approve parts of the US budget piecemeal, starting with the popular national parks, would allow a small minority to control spending and end health care, education or other programs favored by Democrats. Thomas Friedman, of the New York Times, argues that “the future of how we govern ourselves is at stake.” He points to structural changes in US politics, including political...