The American Economy Bucks Headwinds, Domestic and Foreign

The international monetary Fund now thinks the global economy will grow at a 3% annual rate this year. In July, it put that figure at 3.2%. It blames the revision on barriers to trade, which are estimated by the World Trade Organization to reduce the growth in merchandise trade this year to 1.2%, the lowest […]

Revolution or Reform: The Future of Market Capitalism

Capitalism, at least as we have known it, R.I.P. Burial to take place on election day, November 3, 2020. Cause of death: the refusal of dominant elites to consider the consequences of so-called free trade, special tax treatments, and some of their other favorite programs. Grave-diggers to include Donald Trump and a person to be […]

Trump’s Troubles

This may well be the worst of times for President Trump since his election victory almost three years ago. A mere 37% of Americans approve of the way he is handling his job, according to a CNBC Economic Survey. That is the lowest level of his presidency. Fifty-three percent disapprove. Worse still for a President […]

Crisis in the U.S. and The UK and the Men at Their Center

Two great democracies, their political processes paralyzed by attempts to deny the will of the people. In Britain, voters in a referendum told their representatives they want to leave the European Union and its overweening bureaucracy, to snatch sovereignty back from Brussels to Westminster. The Establishment is having none of it, and has Boris on […]

The 2% Solution, Or Is It 3%?

America is in the midst of a real-time, real-world economic experiment to discover whether a nation can talk itself into a recession. We know from past experiments that it cannot talk itself out of one. Early in the Great Depression of the 1930s then-President Herbert Hoover sought to lift spirits and the economy by proclaiming, […]

Inflation Is The Politician’s Best Friend

The U.S. is growing faster than other major developing countries. The dollar has gained against seven of its Group-of-10 peers this year and “is having its best decade on record,” reports Bloomberg’s Viven Lou Chen. Foreign money is pouring into the U.S. That’s the bad news. The strong dollar, which hurts exporters and reduces the […]

The Inverted Yield Curve: Fair Warning or False Alarm?

Recession fears soared last week because of something called an inverted yield curve which exists when investors shift their cash from shares into the relative safety of government bonds. That drives the price of bonds up, and, the flip side, interest rates down. Since recessions last a while, investors, when fearing a recession, prefer longer-term […]

Powell Cuts, Trump Wants More, Who Needs The Fed Anyway

It is rare that a chairman of the Federal Reserve Board can give a routine speech confirming a widely anticipated and minor interest-rate change and, rather than produce a yawn, precipitate the steepest one-day share-price plunge since May, and a rise in the dollar to a two-year high against six major currencies. Jay Powell accomplished […]

The Congress Runs Up Deficits, The Fed Runs Down Rates

Recoveries don’t die of old age. They are murdered by policymakers. That was true in the 1930s, and it may well be true these many years later. Post mortems are likely to discover that the politicians and the Fed will turn out to be partners-in-crime, the politicians by drowning the recovery in red ink, the […]

Powell Speaks, Congress Listens, The President Fumes

His appearances before a pair of congressional committees last week were the least of Federal Reserve Board chairman Jay Powell’s problems. His reputation for candor and the individual and small-group meetings he has held with 116 congresspersons in his 16 months in office assured a respectful reception and protection from a president threatening to fire […]