What Caused U.S.-Chinese Market Turmoil?

As the Fed is paving way for the first rate hike in a decade, the world economy prepares for the greatest shift of capital flows in half a decade. Recent market turmoil in the U.S. and China heralds the transition. According to the conventional wisdom, the U.S. economy is recovering significantly faster than other advanced […]

For Whom the Bell Tolls, Really The Impact of the Sanctions Against Russia

The sanctions against Russia are working; but not for Russia, Ukraine, the EU, or even the US. In the 2nd quarter, Russia’s GDP contracted 4.6 percent from a year earlier, following a 2.2 percent contraction in the 1st quarter. A severe contraction was expected after the selloff in oil, currency crisis and the consequent plunge of consumer […]

Small Is Beautiful… but Vulnerable!

Many small states are known for their pristine natural environments and are either tourism or commodity based. However, despite numerous challenges emanating from their specific vulnerabilities and small size, the issues faced by these countries have remained somewhat veiled and unaddressed.  Many of these countries are highly exposed to the most disastrous consequences of climate […]

"Video Killed the Radio Star": Why Hasn’t Technology Destroyed All Jobs?

Destruction of jobs by machines is an old issue that has appeared several times in history beginning with the famous Luddite resistance to the introduction of textile machinery in England early in the Industrial Revolution. It arose again during the 1960s when President Lyndon Johnson appointed the Bowen Commission to study the technology/job loss nexus […]

Greece’s Missing Drivers of Growth

Analyses and discussions of Greece’s economic situation usually begin—and often end—with its fiscal policy. The policies mandated by the “troika” of the European Commission, the European Central Bank and the International Monetary Fund have undoubtedly resulted in a severe contraction that will continue for at least this year. But little has been said about the […]

Noise & Signal in the Retail Sales Number

This week, investors, journalists, and economists expect that “Thursday’s release of July retail sales data by the Commerce Department could merit a market reaction, particularly if U.S. sales rebounded last month from a weak showing in June. Economists are expecting a 0.5% bump thanks to increased motor vehicle sales.” [Fortune, Aug 9th 2015]. Every month, […]

The Gold Conundrum

(Or Why Gold Prices Have Different Short and Medium Term Trajectories) Not so long ago, gold rose to new highs. Recently, it has suffered the most challenging losses since 1999. The Fed’s rate hikes do not bode well for the gold in the near term, but what about in the medium-term? After climbing to US$1,206 […]