Trade Deals Must Allow for Regulating Finance. World leaders who are gathering for the APEC summit next week had hoped to be signing the Trans-Pacific Partnership Agreement (TPP).
The pact would bring together key Pacific-rim countries into a trading bloc that the United States hopes could counter China’s growing influence in the region. But talks remain stalled. Among other sticking points, the U.S. is insisting that its TPP trading partners dismantle regulations for cross-border finance. Many TPP nations will have none of it, and for good reason. The U.S. stands on the wrong side of experience, economic theory, and guidelines issued by the International Monetary Fund.
The Last Days of Pushing on a String. Mark Blyth A metaphor attributed to John Maynard Keynes maintains that using monetary policy to fight a severe recession is like “pushing on a piece of string.”
When the problem is inflation, pushing up interest rates (pulling on a string) is a pretty effective policy tool — ask anyone who lived through the Volcker recession of the early 1980s. But when rates are pushed down to stimulate economic activity the ‘push’ becomes less and less effective the closer to zero rates get. The power of this “pushing on a string” metaphor is especially apparent today.
Understanding the World Economy. Savings, Investment and exports: understanding sectoral balances. Global trade & Capital flow imbalances. What is capitalism? Debating the future of capitalism - perspectives... Debt & Deleveraging. The politics and economics of Austerity. "Globalization" IFIs... To sort.