Traders and investors trying to parse the statements coming from the world’s most important central bank are at a loss: Will an interest-rate increase come in September? And will there be one, two or no hikes this year?
Data Geeks Are Taking Over Economics
For a few decades, economists used to imagine how the world works, write down a theory describing their idea, and call it a day. If some statisticians came along and found some support for the theory, well, great! But usually they didn’t, and that was fine too. As one old joke put it, if an idea worked in practice, economists would ask whether it worked in theory.
There’s No Such Thing as an Economic Miracle
One of the less heralded truths of economics is that growth miracles, while they make for good press, are overrated. It’s an insight that could help us better understand the outlook for developing countries such as China.
Why We’re Still Arguing Whether QE Worked
How many times have you heard someone say that the Federal Reserve’s asset-purchase program known as quantitative easing was ineffective? At least, that’s what I keep hearing from the usual pundits arguing their case.
Overcoming Our Inordinate Fear of Inflation
The harm of inflation cited in economics textbooks seems laughably unimportant. For example, inflation generates so-called shoe-leather costs — a term for the hassle of moving money from one’s brokerage or savings account to one’s checking account. This hassle is larger when prices change a lot, since you have to put spending cash in your wallet more often.
The New Old Economics of Free Trade World Wide
Does economics still believe in free trade? The discipline has urged the case for open markets since its earliest days, but lately not so much. Recent research is seen as calling the faith into question.