In The News

Vanessa Steinmetz August 19, 2019
Even small amounts of debt can contribute to lasting trouble for those living in developing nations. Vanessa Steinmetz describes the plight of a cassava farmer and father of five in Cambodia who struggles to repay a bank microloan of $3250 just before the prices of that commodity fell. He had placed a hectare of his farm as collateral, before selling other land at a loss and taking out another...
Greg Ip August 14, 2019
Major shifts in world systems can result in global downturns, argues Greg Ip for the Wall Street Journal. This was the case for the end of the era of cheap oil but not the advent of the internet. Increasing resistance to globalization and open markets fueled by nationalism and populism – and a general decline in diplomacy with Brexit, the US-China and South Korea-Japan trade wars, divisions in...
Joseph E. Stiglitz August 12, 2019
The Trump administration is delivering shocks to the economy before experts can assess the consequences, suggests economist Joseph Stiglitz. All that is sure about the US economy is volatility and uncertainty. Reductions in the interest rate by the US Federal Reserve as central bank have little effect. “Long ago, John Maynard Keynes recognized that while a sudden tightening of monetary policy,...
August 12, 2019
Protests have paralyzed Hong Kong throughout the summer, putting China’s system of governance for the island into question. While the protesters’ numbers have fallen, the movement has expanded its demands and methods, including disruptions that have forced the Hong Kong airport to close. The protests may have dashed China’s vision for Hong Kong as an “‘economic’ city in which politics plays a...
Park Ga-young August 7, 2019
Stock exchanges of many nations imposed various bans on short-selling during and after the 2008-2009 global debt crisis. Investors expecting a stock to decline borrow shares – as a hedging strategy or speculation – and then resell these to buyers who pay the market price: Further decline results in profits for the first investor while a rise can result in huge losses, explains Investopedia. South...
Kenneth Rapoza August 6, 2019
A trade war and US tariffs have eroded the value of China’s currency. The US president announced tariffs and global stock markets declined. The US Treasury Department designated China as a currency manipulator, and China’s central bank announced removing about 30 billion yuan, or $4.2 billion, from the Hong Kong market. China denies the currency manipulation charge. “Many emerging market central...
Yen Nee Lee July 31, 2019
Investors are alert to any signs of a global recession and decline in economic growth. A research and analytics unit under S&P Global suggests that companies that have skipped the crediting rating process in taking on debt could be signaling signs of troubles. Credit ratings provide an independent assessment on the ability to repay debt, and low interest rates and attempts by central banks to...