MONETARY REGIMES - CounterStrikeMedia

FUNDAMENTALS OF EQUILIBRIUM EXCHANGE RATES

11/30/2017

Estimates of Fundamental Equilibrium Exchange Rates, November 2017

The early boost to the dollar following President Donald Trump's election—a Trump "bump"—has been replaced by a Trump "dump." The real effective exchange rate (REER) for the US dollar fell by 6.3 percent from its monthly peak in December 2016 to the October base period used in this study. As a...

THE STATUS OF ASIAN BONDS, WHAT FINANCIAL, FISCAL REFORM LOOKS LIKE & TRUMP DENIES CHINA'S STATUS AS A MARKET ECONOMY

11/30/2017

China's debt fail is nearly invisible and finally unsolvable. @gordongchang @thedailybeast Andrew Collier.

China's central bank governor, Zhou Xiaochuan, made global headlines with a warning last month of the risks of a "Minsky moment", referring to a sudden collapse in asset prices after long periods of growth, sparked by debt or currency pressures.

On the sidelines of a key, twice-a-decade Communist Party Congress in October, Zhou referred to relatively high corporate debt and the fast pace of growth in household lending.

While also pledging to fend off such risks, Zhou has acknowledged it will take some time to bring debt down to more manageable levels.

Reuters analysis of 2,146 China listed firms showed their total debt at the end of September jumped 23 percent from a year ago, the highest pace of growth since 2013. The analysis covered three-fifths of the country's listed firms, but excluded financials, which have seen the brunt of government de-risking and deleveraging efforts so far.

The analysis revealed that debt in the real estate sector multiplied the most over last five years, followed by industrials.

Effective Financial Reform
by John H. Cochrane via PolicyEd.org
Financial crises come from bank runs. An innovative way to prevent bank runs is to use equity-financed banking. Equity-financed banks would replace debt with equity as their method of financing and back up all deposits with liquid assets like Treasury bonds. Since it would not hold any debt, bank runs would become a thing of the past.

ASIAN DEVELOPMENT BANK & ASIAN CORPORATE BONDS

How to improve the long-run outlook for US fiscal policy
Alex Brill | Macdonald-Laurier Institute
The US is headed toward a federal debt crisis certain to inflict serious economic hardship on future generations. Over the next 30 years, the US economy is expected to grow 76 percent, but the debt burden will increase by more than 240 percent. Returning to a sustainable fiscal outlook will require hard choices and a clear understanding of both what led us to this point and the economic consequences of inaction.

The Trump administration has formally rejected China’s demand that it be treated as a “market economy” under global trading rules, a move likely to heighten tensions between the world’s two largest economies. - Wall Street Journal

REFORMING CHINA'S POLITICAL ECONOMY: THE ASIA TIMES "CHINA DIGEST"

11/29/2017

CORPORATE PROFITS & DEBT

Infrastructure, not speculation, explains China’s corporate debt DAVID P. GOLDMAN

A different way to look at China’s debt DAVID P. GOLDMAN

China’s big banks beat profit expectations, curb bad loans DAVID P. GOLDMAN

MONEY GROWTH SLOWDOWN FOR CHINA: ASIA TIMES

CHINA DIGEST AT ASIA TIMES

CHINA'S BONDS ARE PAYING SLOWLY: EMERGING DEBT CRISIS GROWS, ASIA TIMES

ACHILLES HEEL OF THE EURO ZONE

11/29/2017

Italy is the Achilles' heel of the eurozone
Desmond Lachman | Real Clear Market

ORIGINAL INTENT & FOREIGN INVESTMENT

11/29/2017

Feds Need to Return to the Original Intent of Foreign Investment
Grover Norquist, The Hill

OUTLOOK FOR THE GLOBAL ECONOMY FOR 2018

11/29/2017

The Global Economy In 2018
by Michael Spence via Project Syndicate
The global economy will confront serious challenges in the months and years ahead, and looming in the background is a mountain of debt that makes markets nervous – and that thus increases the system's vulnerability to destabilizing shocks. Yet the baseline scenario seems to be one of continuity, with no obvious convulsions on the horizon.

FOREIGN INVESTORS DUMP TURKEY

11/25/2017

Foreign investors flee Turkey
Turkey’s domestic political tensions and mounting rows with Western allies have fueled the flight of foreign investors, exacerbating the country’s economic woes.

RAJAN & INDIA'S ECONOMIC OUTLOOK

11/25/2017

ASIA TIMES

Raghuram Rajan Calls For Broad-Basing Economic Growth
featuring Raghuram Rajan via Live Mint
Former RBI governor Raghuram Rajan argues that short-term political solutions to the job reservation issue can damage the fabric of the country.

TUNISIA DOUBLES DOWN ON ECONOMIC REFORMS

11/22/2017

Tunisia doubles down on austerity
Tunisia’s Prime Minister Youssef Chahed said Tuesday that his government will go ahead with a package of economic reforms that are strongly opposed by labor unions and business associations. The austerity measures include raising taxes and laying off thousands of government workers in order to cut Tunisia’s budget deficit. Speaking at a parliamentary session on the 2018 state budget, Chahed said, “We will seek consensus with all, but we go ahead with reforms needed to revive the economy.” The International Monetary Fund has been pressuring Tunisia to curb its budget deficit after a series of militant attacks damaged the country’s vital tourism sector. Read More

Congress pushes Tunisia aid compact to counter Trump cuts
The fledgling North African democracy is dispatching dignitaries to argue for a multi-year memorandum of understanding to help combat terrorism and social unrest.

REGULATORS ARE FIGHTING "THE LAST WAR"

11/22/2017

U.S. NEWS & WORLD REPORT

JOHN B. TAYLOR: 25 YEARS AGO, TAYLOR RULE UNLEASHED UPON CENTRAL BANKS

11/22/2017

ECONOMICS ONE

XI GAMES TRUMP ON TRADE POLICY

11/21/2017

https://www.wsj.com/articles/beyond-trump-xi-bond-white-house-looks-to-toughen-china-policy-1511124832#comments_sector

China moves to bolster nine key areas of manufacturing
BY ASIA TIMES STAFF
NDRC releases new Three-Year Plan that targets significant improvement in manufacturing innovation capability and product quality

Beijing cracks down on P2P online lenders
BY ASIA TIMES STAFF
All P2P platforms lending cash loans must meet strict requirements and obtain proper licences by Dec. 31

China’s debt grew in September at fastest pace in four years
BY ASIA TIMES STAFF
Real estate, industrial sectors led increase

NEW DELHI'S CHALLENGE: BALANCING THE FISC IN AN OIL RALLY

11/21/2017

THE HINDU BUSINESS LINE

U.S. CENTRAL BANK BEGINS TO LIKE NATURAL RATE OF INTEREST HYPOTHESIS: THE DEATH OF PHILLIPS CURVE BEGINS

11/20/2017

Should We Reject the Natural Rate Hypothesis?
Fifty years ago, Milton Friedman articulated the natural rate hypothesis. It was composed of two sub-hypotheses: First, the natural rate of unemployment is independent of monetary policy. Second, there is no long-run tradeoff between the deviation of unemployment from the natural rate and inflation...

FORWARD GUIDANCE & VOLATILITY: THE NEW NORMAL

11/19/2017

Forward Guidance Hasn't Made Markets Less Volatile
quoting John B. Taylor via Bloomberg
One possibility comes from a proposal by John Taylor, a professor at Stanford University, who provided a formula in 1993 for setting interest rates.

VIDEO: BLOOMBERG SURVEILLANCE

THE ILLUSION OF ASIAN VOLATILITY

11/16/2017

ASIA TIMES

Policy Uncertainty In Japan
by Elif C. Arbatli, Steven J. Davis, Arata Ito, Naoko Miake, Ikuo Saito via Cato Institute
Efforts to reinvigorate Japan’s economy have proved challenging. Despite significant policy accommodation, growth over the past two decades has been weak and the share of nonregular employment has increased. Wages have been stagnant, and inflation expectations lie below the Bank of Japan’s inflation target.

CHINA: ON CENTRAL BANK REFORM, BLOOMBERG SURVEILLANCE VIDEO

CHINA: HOW DOES BEIJING REFORM BANKING, CAPITAL ACCOUNT REFORM, BLOOMBERG SURVEILLANCE VIDEO

EICHENSTEIN ON OPENING CHINA'S CAPITAL ACCOUNT, CURRENCY VOLATILITY

US arrests two over massive Chinese oil bribery scheme in Africa
BY AGENCIES AND ASIA TIMES
Hong Kong's former home affairs secretary Patrick Chi Ping Ho is one of two parties charged. CEFC China Energy is the company implicated

A NEW INDIAN TAX REGIME STARTS & IRVING FISHER EQUATIONS

11/16/2017

ASIA TIMES

Journal Graphics In A Bygone Era
by John H. Cochrane via Grumpy Economist
To illustrate MV = PY. In Irving Fisher, "The Equation of Exchange 1896-1910," The American Economic Review Vol. 1, No. 2 (June, 1911), pp. 296-305, via JSTOR.

CHINA SEEKS TO OPEN DOMESTIC COMMERCIAL BOND MARKETS FOR CONNECTIVITY, WILL IT WORK??

11/14/2017

ASIA TIMES

CHINESE STATE MONOPOLIES BEGIN PARTIAL REFORM

Central bank official says credit activities must be monitored
BY ASIA TIMES STAFF
For real, data-driven credit products, Liu Qiang advocates capital controls, liquidity regulation and interest rate self-regulation

Bond market financing on the rise, says chief economist
BY ASIA TIMES STAFF
Especially for those firms with a clean balance sheet and higher transparency, their cost of direct financing will be even lower

China to issue US$1.06 Bln in treasury bonds in Hong Kong
BY ASIA TIMES STAFF
The bonds are being issued for institutional investors, foreign central banks and regional monetary authorities

RAJAN ON POPULISM & ECONOMICS

11/14/2017

Steven Davis And Raghuram Rajan: How Can Policy Makers Respond To Populist Politics?
interview with Steven J. Davis, Raghuram Rajan via Chicago Booth Review
Hoover Institution fellows Steven Davis and Raghuram Rajan discuss when we should normalize monetary policy; the consequences of unconventional monetary policy; the sustainability of China's growth; and the roots of populist politics.

Will India's Jump In Ease Of Doing Business Rankings Foster Economic Growth?
quoting John H. Cochrane via Live Mint
India’s jump in ease of doing business rankings may not readily translate into investments and growth, an analysis of past changes in rankings suggests.

EGYPT: OPENING NEW STOCK EXCHANGE

How to Combat Populist Demagogues
Dani Rodrik doubts that reformist politicians can win unless they come clean about the high costs of neoliberal policies.

Democracy Beyond the Nation-State
Kemal Derviş thinks that empowering cities could be the key to reconciling popular sovereignty and globalization.

U.S. DOLLAR REMAINS DEEPLY CORRELATED WITH SAUDI OIL

11/13/2017

BLOOMBERG

RUSSIAN PROPAGANDA ON U.S. WAR AIMS PREVENTING YUAN-SAUDI DENOMINATION

FOREIGN INVESTMENT & NATIONAL SECURITY

11/13/2017

AEI

VAT & THE SAUDI FINANCIAL SECTOR

11/13/2017

ASHARQ AL-AWSAT

WHY CENTRAL BANKS ARE "IN THE DOCK"

11/13/2017

PROJECT SYNDICATE

The Real Questions The Fed Should Ask Itself
by John H. Cochrane via Chicago Booth Review
Don’t mistake relative calm in the financial system for a sign that the central bank’s work is done.

Policy Implications of Sustained Low Productivity Growth
The Peterson Institute for International Economics will hold a major research conference on the "Policy Implications of Sustained Low Productivity Growth" on November 9, 2017. Conference organizers Jeromin Zettelmeyer and Adam S. Posen have assembled a group of leading policy economists to tackle...

INDIA: THE AFTERMATH OF DEMONITIZATION

11/9/2017

AEI

HOW DIGITAL CURRENCIES WORK

11/8/2017

GRI