Economics

Separate Politics and Economics at Your Own Peril


Many people understand politics and economics to be two different disciplines.  I remember in graduate school more than two decades ago, many colleagues and professors operationally defined political economy as how politics, by which they meant the state, screws up economics. 

I spoke at the Fixed Income Leaders Summit earlier this week and teased that many seemed to think that politics comes from the ancient Greek "poly" meaning many and "tics" meaning bloodsucking parasites.  It, of course, is not true.

Down, then Up, the Dollar is Ready for the Weekend


The US dollar weakened in the first half of the week as participants continued to react to the shockingly poor jobs report and shift in Fed expectations.  However, it recovered smartly yesterday and is seeing some modest follow through buying today. 

Small Business, Big (Environmental) Impact


Understanding how businesses engage in environmental management is important given growing global concerns  about the depletion of natural resources and reductions in biodiversity. There has been a great deal of focus on large businesses, but small businesses have a role to play too. The fact that small businesses are neglecting this is of great concern.

Japan's 'Womenomics' needs to Work in Business and Government


Japan has the lowest percentage of women’s political representation in the industrialised world. Women hold only 12 percent of seats in the national legislative assembly, the Diet. This is compared to a 22 percent world average and a 19 percent average in Asia.

Japan’s ranking in the 2015 World Economic Forum Global Gender Gap Report at 101 out of 145 countries indicates some serious problems. Health and education are not problems for the women of Japan; it is economic and political empowerment where the stark inequality lies.

When Unconventional Monetary Policy Becomes Conventional


One of the most significant new developments in the global post-global financial crisis (GFC) economy is the enormous asset purchase programs implemented by central banks in the industrial world to stimulate their economies. Widely known as quantitative easing (QE) programs, their impact has been substantial.

The Dollar Meanders, South Korea Delivers a Surprise Rate Cut


The US dollar is posting modest upticks against most of the European currencies and the Canadian and Australian dollars. However, it has fallen against the yen and taken out the recent low, leaving little between it and the May 3 low near JPY105.50.  The New Zealand dollar though is the strongest of the major currencies; gaining 1.5% following the RBNZ's decision to leave rates on hold, and signal of little urgency to cut again in the near-term. 

Can the Fed Hike Rates in an Election Year?


The most important element in next week's FOMC meeting may come from the dot plot and whether the Fed officials are backing away from the two hikes thought appropriate in March.

When looking the schedule of FOMC meetings, and understanding that when the Fed says "gradual" to describe the normalization process, it does not mean hiking at back-to-back meetings, seeing two hikes this year without a summer move is difficult.

What Makes Us Want to Work?


While most people spend a good proportion of their life at work, few will ever stop to consider whether their work is meaningful. “Meaningfulness” is not something that tends to feature in our daily thoughts, preoccupied as we often are by more mundane matters like rent, bills and lunch.

India-Iran Diplomacy Momentum Shift


India’s West Asian diplomacy has undergone a remarkable shift, with Iran becoming a major foreign policy priority for the Modi government. Modi’s recent visit to Iran on 22–23 May resulted in the signing of 12 agreements in areas ranging from trade and commerce to security and counterterrorism, emphasising this progress.

Economic Data Overshadowed by the UK Referendum, US Election


The foreign exchange market is quiet.  The euro remains confined to the narrow range seen on Monday between $1.1325 and $1.1395.  We continue to look for higher levels near-term as the drop from May 3 (~$1.1615) to May 30 (just below $1.11) is corrected.  A move above $1.1420 would likely spur more buying.