In The News

Beijing’s Shadowy Fund for Buying Assets

Jamil Anderlini September 19, 2008
China’s government has an immense pool of savings, which has ballooned in value over the past eight years, and decisions about how to invest or spend that cash influences other nations and industries. One fund, Chinese Investment Corp., is more open than the State Administration of Foreign Exchange, which manages the world’s largest foreign-exchange reserves. The Chinese funds have gradually...

Paulson’s Moment of Truth

September 18, 2008
With major firms imperiled, the US government has had to up-end its economic policies by intervening and extending rescues to private investment banks, government-sponsored lenders and a major insurance firm. The bail-outs have added to US debt while deflating value of the US dollar. By refusing to bail out investment bank Lehman Brothers, US Treasury Secretary Henry Paulson signaled that...

Wall Street Dodges a Bullet, How About Next One?

David Dapice September 17, 2008
Low interest rates prompted many investors and homeowners to pour savings into real estate and homes. Investors, convinced that prices could not fall, purchased debt packages including mortgages based on ample credit with little down payments. Prices for homes and investments soared, with the total value of US housing going from about $12 trillion in 2000 to more than $20 trillion in 2006. Now,...

Bailing Out Economies

Nayan Chanda August 1, 2008
Capital is mobile, seeking profit, and it moves to countries where the returns are higher, with no regard for immobile workers, explains Nayan Chanda in his column for Businessworld. Flush with cash, foreign investors in search of safe havens invested in bonds issued by US government-sponsored mortgage lenders, Freddie Mac and Fannie Mae. With the bonds not as safe as advertised, the US...

What If the Candidates Pandered to Economists?

N. Gregory Mankiw July 21, 2008
Economists make up a tiny portion of the voting bloc and politicians rarely pander to them, perhaps because economists rarely speak with a single voice regarding any issue. However, economists do reach consensus on a few issues. For example, most economists support free trade, and argue that laws preventing free trade are nothing more than laws protecting special-interest groups from competition...

Act Now to Prick the Oil Price Bubble

Meghnad Desai June 6, 2008
Analysts give plenty of reasons for the price of oil to climb – including increased demand from China and India, unrest in Nigeria, conflict in the Middle East, increased costs associated with exploration, limited refinement capacities. But these events are not new or sudden and probably don’t fully account for the steep increases, explains Meghand Desai, professor with the London School of...

Real Message Is Clear

Jennifer Hewett April 30, 2008
China’s boom has filled its coffers with lots of cash. Some nations, including Australia, want to slow the fast pace of China’s foreign investment – taking time to assess consequences. The most recent takeover target is West Australian iron-ore producer Midwest by China's Sinosteel, and the latter could be on the hunt for other iron-ore producers, reports Jennifer Hewett for the Australian...