May, 2018

• 28 May

  The China debacle

  

  President Trump’s education in global trade continues. Not long ago, he declared that trade wars ‘are good and easy to win.’ He knows better now. The administration’s performance in its latest trade talks with China has been ineffectual, instructive and (yes) humiliating. Let’s be clear. China is the one major country where an aggressive American trade policy is warranted — ...

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• 28 May

  Markets don’t care about your needs

  

  You may have reasonable expectations of what you can expect from your investments during the coming years and decades. But regardless of what your risk-adjusted return expectations are, the first rule of economics cannot be denied: There is no free lunch. I was reminded of this by a report that the League of California Cities wanted the state’s big public ...

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• 28 May

  Electric cars are feeling a little bit of competition

  

  Electric cars topped the 1 million sales milestone in 2017, a 57 percent increase over 2016. Chinese consumers alone purchased more than half a million electric cars. And Bloomberg New Energy Finance expects more than half of all new cars sold, and a third of the total light vehicles on the road, to be electric by the year 2040. But ...

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• 28 May

  Lawmakers officially forget financial crisis

  The US Congress might have just set a record for shortness of memory: Just 10 years after a crisis that nearly brought down the global financial system, it’s loosening the safeguards designed to prevent a repeat. Now it’s up to regulators — and specifically the Federal Reserve — to ensure that the backsliding doesn’t go too far. Prodded by President ...

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• 28 May

  Italy finally gets a taste of Boris Johnson’s cake

  

  Italy’s populist dream team has a radical plan to revive the country’s economy. Successive drafts of the coalition agreement between the League and the Five Star Movement, seen over the past few days, show the two parties are keen to press ahead with their lavish tax cuts and spending pledges, in spite of Italy’s mammoth public debt. There’s a double ...

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• 28 May

  Unemployment in US hits a low. Then comes the recession

  

  Whatever one might think about the US political situation, it’s hard to deny that the economy is doing just fine. In April, the unemployment rate dropped to 3.9 percent, a 17-year low. At this point, there’s a job opening for every unemployed person in the country. Not bad. In the spirit of seeing the glass as half empty, though, it’s ...

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• 28 May

  A top economics prize for a theory that really works

  

  What do people think economic theorists do? The pundits who regularly criticize the profession, particularly in the pages of British magazines, seem to think that they spend all their time making abstruse, unrealistic theories about how free markets are the best of all possible worlds. And it’s true that there are still a few economists out there who are essentially ...

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• 28 May

  US stock futures rise on hopes of US-North Korea summit

  

  Bloomberg US equity futures followed Asian shares higher on signals an America-North Korea summit is back on track, but risk appetite waned in Europe as Italy’s political outlook darkened. The region’s stocks and common currency both surrendered gains. S&P 500 futures advanced, as did South Korean stocks, after President Donald Trump appeared to confirm that his June meeting with Kim ...

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• 28 May

  Markets convulse as Italy seen on course for new elections

  

  Bloomberg Chaos ruled Italian markets as the nation plunged deeper into political turmoil. Yields on the nation’s two-year bonds surged to the highest in four years in holiday-thinned trading, while stocks slumped for a fourth day as President Sergio Mattarella asked economist Carlo Cottarelli to form a government. Earlier League leader Matteo Salvini said that it made no sense for ...

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• 28 May

  ECB tests flavour of inflation as big policy discussion looms

  

  Bloomberg This isn’t the inflation the European Central Bank is looking for — but it is inflation. Figures this week are forecast to show euro-area consumer-price growth could have reached its fastest since early 2017 on the back of more expensive oil and a rebound in travel costs. The cost of crude and a weaker euro are also set to ...

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