More in Global Economy


9 months

Back To Fundamentals

If we look at the list of key macroeconomic data published in recent weeks, we can not use a better definition than “disappointing”.

9 months

What Newfangled Rent Control Looks Like

Oregon has just become the first to enact a statewide rent control law. Governor Kate Brown said: "This legislation will provide some immediate relief to Oregonians struggling to keep up with rising rents and a tight rental market." That statement is of course literally incorrect, because the Oregonians struggling with rising rents are in exactly the same position now as they were before the passage of the law. The new bill limits future increases in rents for existing renters to 7%, plus inflation, so it is clearly not a rigid limit. It will be interesting to see of that limit on future increases gets ratcheted back in the future.

9 months

Opioid Crisis

The opioid crisis seems to me one of those issues everyone knows exists, but also an issue that our political system and society really hasn't come to grips with. Molly Schnell provides a useful short overview in "The Opioid Crisis: Tragedy, Treatments and Trade-offs," written as a Policy Brief for the Stanford Institute of Economic Policy Reseach (February 2019). She writes: 

9 months

Some Snapshots and Thoughts about US Entrepreneurship

A dynamic and healthy economy will always be undergoing a process of churn: new companies and new jobs starting, but also existing companies and jobs ending. Thus, it's been troubling to see articles about "The Decline in US Entrepreneurship" (August 4, 2014), a lower rate of business startups, and a decline in how much new firms are offering in terms of job gains.

9 months

A US-China Trade Deal May Not Be The Catalyst of Optimism

Market strategists and policymakers are putting too much emphasis on a trade deal between the United States and China, and it’s quite likely that whatever is agreed will disappoint.

9 months

The Chinese Economic Slowdown May Benefit Canada

In recent months, analysts and market commentators have voiced concerns about a slowdown in the Chinese economy. The general view is that growth significantly below the current level of 6 per cent to 6.5 per cent would be bad for the global economy, posing the risk of modest deflation or even becoming a drag on economies around the world – legitimate concerns.

9 months

From What Direction is the Next Recession Coming?

If you were learning about the causes of post-World War II US recessions 20 years ago, the standard chain of events went like this: As the economy goes into an upswing, wage and price inflation starts to rise. The Federal Reserve recognizes that rising inflation isn't a sign of healthy growth, and raises interest rates. In often-used phrase, it's the job of the Federal Reserve to order that "the punch bowl removed just when the party was really warming up." The higher interest rates dampen inflation, but also lead to recession. The clear implication from this earlier line of thought is that recessions don't occur just because a recovery has gone on for a long time: instead, recessions are caused when the Fed decides to dampen inflation. For example, here's eminent economist Rudiger Dornbusch (and co-author of one of the preeminent macroeconomics textbooks of the time) writing back in 1997: