Politically crisis by the end of 2020 and how growth in trade reduces the probability of conflicts
Preparing for the Crisis After the Crisis (ASPI, 6 min read) China is using the virus to position itself strategically by claiming that authoritarianism did a better job in beating the virus than Western democracy. This comes after its aggressive military positioning around Taiwan. There is a potential regional security risk brewing, which can lead to a global political crisis by year-end or early in 2021.
The Grim Truth About the “Swedish Model (Project Syndicate, 6 min read) Those inspired by the Swedish model of low-scale lockdown should understand that it comes with a higher death toll per capita basis (136 deaths/million people relative to 49 in Germany).
Atlantic Trade and the Decline of Conflict in Europe (VOX EU, 4 min read) This column examines the relationship between Atlantic trade and war in Europe between 1640 and 1896 (a period in which intra-European conflict decreased dramatically). It finds that the growth in Atlantic trade lowered the probability of intra-European conflict by 15%.
Why 2020 US elections will be Polarised and rise Pandenomics
The COVID-19 Blame Game Is Going To Get Uglier (FiveThirtyEight, 7 min read) The 2020 election will be the COVID-19 election. Voters are polarized on how President Trump’s handled the pandemic. Not only the US Health care system and the economy will be tested, but its democracy too.
Pandenomics – Policymaking in a Post-pandemic World (VoxEu, 6 min read) Divisive nationalism, increased risk aversion and the need to build resilience will weigh on economic growth years ahead. But resilience will also call for accelerated use of digital technology and harnessing societal pressure which will present opportunities for smarter and more far-sighted governments.
Fresh Tests for ECB after Easter Accord (OMFIF, 4 min read) Pressure on Italian bonds may intensify the take-up of the ECB’s emergency €750bn bond-buying facility. This could become increasingly targeted on Italian purchases, leading to political and legal controversy ahead of the next EU leaders’ meeting on 23 April.
COVID-19 may lead to self-sufficiency and deglobalization.
What Explains The Bump In Trump’s Approval Ratings? ( FiveThirtyEight, 4 min read) Heightened national unity triggers the rally around the flag effect. This short-term effect usually gets triggered during outbreaks of war, terrorist attack or natural disasters. Other major world leaders have experienced a much higher increase in their approval rating. The bigger question is whether Trump can sustain this higher rating?
The Coronavirus Pandemic Has Opened the Curtains on the World’s Next Economic Model (Naked Capitalism, 10 min read) The US’ inability to produce basic medical gear amid pandemic revealed a strategic vulnerability of being dependent on multinational supply chains. The new economic era will be dominated by countries who are self-integrated. Recent advances in technology such as AI computing, Automated Manufacturing, nanotechnology and highspeed data transfer will quicken this transition
Stretching the international order to its breaking point (Brookings, 14 min read) COVID-19 is the fourth major geopolitical shock in as many. In each of the previous three, analysts and leaders underestimated the long-term impact on their society and world politics. A crisis will make the government focus on the national economy and lead to de-globalization.
How Sunak will dominate in Johnson’s absence and why US states should preparing now for postal voting
Boris Johnson’s Coronavirus Diagnosis: What History Teaches Us About Prime Ministers and Illness (The Conversation, 3 min read) Boris Johnson is not the first British PM to continue with his duties despite illness, in his case the coronavirus, and the UK’s parliamentary system means that Dominic Raab, the first secretary of state is the next in line. But in reality Chancellor Rishi Sunak will dominate over Raab.
This Isn’t The First Time America Has Weathered A Crisis In An Election Year (FiveThirtyEight, 7 min read) Past US elections have been disrupted by disease (in particular the Spanish flu in 1918), war and natural disaster with turnout lower than normal. States should start preparing legal and logistical challenges now to ensure more people can vote by mail.
A roadmap for the G20 plus two centuries of large-scale official lending during crises
What the G20 Must Do (Project Syndicate, 4 min read) The G20 must step up with a coordinated fiscal effort, which could provide twice the impact of individual stimulus done in isolation, it should formally bring the WHO into its discussions, establish a fund to support WHO monitoring and research, lead by example and cancel all remaining in-person meetings scheduled for this year.
The Coronavirus Could Reshape Global Order (Foreign Affairs, 10 min read) China’s dominance in producing masks, respirators and other needed equipment combined with its decision to help countries such as Italy and Iran could shape foreign policy once the virus has been defeated. But the US could yet turnaround what has so far been an inadequate response, both domestically and globally.
Coping With Disasters: Lessons From Two Centuries of International Response (VoxEU, 6 min read) Data covering the past two centuries show that official lending generally spikes in times of crisis (war /natural disaster etc) with 1940-44 seeing 10% of US GDP extended annually, or $2trn in current terms. Large scale cross-border lending may therefore be a hallmark of COVID-19.
Biden consolidates his lead in the race for the Democratic presidential nomination
Biden’s Surge and the Power of Fear (Official Monetary and Financial Institutions Forum, 3 min read) Joe Biden is the “least bad choice” for the Democratic presidential nominee with vast foreign policy experience and fairly mainstream economic views. But his sometimes-confused manner and his son’s perceived links to corrupt practices in Ukraine are just a few of his meaningful weaknesses.
Who Won The Biden-Sanders Debate? (FiveThirtyEight, 2 min read) Joe Biden came out ahead after Sunday night’s TV debate, gaining 3 points in support versus a decline of 2 points for Bernie Sanders. Biden remains the candidate viewed as most likely to beat Trump with around two-thirds of respondents projecting him to win the November election.
Sanders’ last chance and Saudi’s leadership shortcomings
Can Sanders Make Up Ground In Tuesday’s Primaries? (FiveThirtyEight, 8 min read) Tuesday’s primaries are the last chance for Bernie Sanders to remain in the race for the Democratic presidential nomination. Michigan is key with the largest number of delegates and his chances here look slim. Bu this state had a huge polling error in 2016.
Bloomberg’s Money Bought Him Something — Just Not the Nomination (FiveThirtyEight, 2 min read) The $500mn spent by Bloomberg on ads saw him gain recognition and rise sharply in the polls, peaking at 16.5% last month. But unsurprisingly it did not translate into votes.
What COVID-19 Means for International Cooperation (Project Syndicate, 4 min read) The coronavirus, like climate change, highlights the need for more international cooperation. Both have uncertain consequences, albeit undoubtedly negative, and both need a coordinated approach despite the initial and required de-globalisation.
In Saudi Arabia, the Virus Crisis Meets Inept Leadership (Brookings, 5 min read) The holy cities of Mecca and Medina have been closed due to fears over COVID-19 and the hajj is no longer certain to go ahead in July/August. Saudi has already changed for the worst under Crown Prince Mohammed bin Salman and with the virus outbreak things could deteriorate further.
US media treating Sanders like Trump in 2016 and how COVID-19 is immune to spin
The One Way Sanders is the New Trump (Colombia Journalism Review, 4 min read) Rather than focusing on what Bernie Sanders’ rising popularity tells us about American voters US journalism is once again dismissing the front runner in a similar way to Trump in 2016.
The Coronavirus and How Political Spin Has Worsened Epidemics (New Yorker, 6 min read) Suppressions of information has, throughout history, worsened pandemics and hindered the response. How the Trump administration manages the coronavirus will be a key test of how it functions after three years of downsizing and dismissing the importance of experts.
Sanders’ big win in Nevada and Trump and the coronavirus
Why Bernie? (Project Syndicate, 4 min read) In the context of wide swings in US election outcome elections over the last 50 year a switch from Donald Trump to Bernie Sanders does not seem inconceivable. Worsening income inequality has hurt moderate Democrats and with voters on both sides increasingly fed up Sanders’ presidential bid should be taken seriously.
Sanders’ Democratic Rivals Seek to Slow His Momentum After His Big Win in Nevada Caucuses (Reuters, 6 min read) Bernie Sanders’ Nevada win has failed to convince his Democratic rivals to drop out, rather the centrists are instead splitting the anti-Sanders vote, making it potentially more difficult to defeat him for the Democratic nomination.
The Coronavirus Outbreak Could Bring Out the Worst in Trump (The Atlantic, 7 min read) Trump’s disregard for experts, institutions and hard facts could prove problematic if the coronavirus takes hold in the US. The US decision to ban entry to foreign nationals who have recently travelled to China comes against WHO guidelines and risks sparking racism against Chinese people.
US pollsters try to correct for 2016 errors and history repeats itself in the UK’s Treasury power grab
Bernie Sanders Isn’t a Socialist (New York Times, 2 min read) Paul Krugman describes Bernie Sanders as more European social democrat rather than true socialist. Sanders’ chosen misnomer will, however, make him an easy target for Republicans.
Pollsters Got it Wrong in the 2016 Election. Now They Want Another Shot (MIT Technology Review, 12 min read) Large numbers of undecided voters, shy Trump supporters, poor sampling and correlated errors were among the factors behind the 2016 polling miss. Errors have since been corrected but pollsters still cannot account for the impact election forecast have on individual’s likelihood of voting.
As Rishi Sunak Cecomes UK Chancellor, a History of Battles Between No 10 and 11 Downing Street (The Conversation, 4 min read) Boris Johnson’s efforts to control the UK Treasury have been tried by various prime ministers before him and have never proved successful. Given the manifold risks facing the UK economy it is unlikely to work this time either.
The importance of healthcare costs in Trump’s re-election bid and investing in a stronger Europe
Embracing Europe’s Power (Project Syndicate, 4 min read) EU countries must invest in a stronger Europe by reaching internal agreements (and avoiding vetoes), and by concentrating action where it aligns with the bloc’s goals and capabilities. Action should be based on common values and interests.
Trump’s Biggest Vulnerability (The Atlantic, 5 min read) Rising healthcare costs could prove more important in Trump’s re-election bid than the economy or stock market performance. This matters most for the “next cluster of voters”, or those not immediately drawn to Trump’s policies in other areas.
Unintended Consequences: Can the Rise of the Educated Class Explain the Revival of Protectionism? (IZA Institute of Labour Economics, 40 page read) A rising share of skilled workers who generally benefit globalization, but leave reduced support for redistribution, can foster resentment and a protectionist push from those left behind.
How demographic changes could impact the US election and Europe after Brexit
Europe Can’t Afford to Alienate the UK (Spiegel International, 7 min read) Europe’s future is more a confederation of states rather than a true union. But that future still needs the UK on side as a key ally with a permanent seat on the UN security council. Trade negotiations must avoid pushing the UK further from Europe’s influence.
The Demographic Shifts Disrupting the Political World (Axios, 3 min read) The growing number of older voters, more states with non-white majorities, and a less rural, less religious country will all influence the 2020 US Presidential election.
As Congress Talks Climate Policy, Carbon Price Gets No Love (Axios, 4 min read) Despite the focus on climate change and the environment carbon pricing is yet to get much support in the US Congress from either side.
America’s polarisation of news and education divides
Election Update: Sanders Is On The Upswing (FiveThirtyEight, 3 min read) The Iowa caucus is coming up on Feb 3rd. Sanders has gained ground and is now tied with Biden for the vote. Meanwhile Sanders is leading in New Hampshire.
Republicans and Democrats Live in “nearly inverse news media environments,” Pew finds (Nieman Lab, 3 min read) Democrats overwhelmingly trust CNN while Republicans trust Fox News. But while Democrats also trust a variety of other sources including The New York Times and PBS, Republicans trust little else. Sean Hannity’s radio show is the one exception.
Michael Lind, College-Educated vs. Not is the New Class War (Supply Side Liberal, 3 min read) A college education defines the political and cultural divide in the US and other rich countries according to Lind’s new book. Rising populism in Europe and elsewhere is the result of alienated, and mostly native, working-class voters standing up to the educated elite.
BlackRock on this year’s geopolitical risks
What to Watch in Geopolitics in 2020 (BlackRock Blog, 2 min read) Mike Pyle, Global Chief Investment strategist for BlackRock, points to the current high in BlackRock’s geopolitical risk indicator with recent tensions between the US and Iran. For this year, geopolitical risks to watch are continued fragmentation of trade and technology, increasing protests driven by income and wealth inequality and cybersecurity.
Taiwanese President Tsai Ing-wen’s re-election risks the ire of China
Entangled US-China-Taiwan Relations Likely Just Got More Complicated After President Tsai Ing-wen’s Big Re-election Victory (SCMP, 2 min read) Saturday’s landslide re-election of Tsai Ing-wen as Taiwanese President will add uncertainty to the US-China relationship and could see Beijing attempting to gain concessions through trade policy. [Bearish US-China]
Political Uncertainty, Market Anomalies and Presidential Honeymoons (Journal of Banking and Finance, 23 pages read) Presidents are usually highly inclined to stamp their own mark in the office at the start of a new term, raising market uncertainty and risk aversion. The authors find robust links with spikes in risk measures during these honeymoon periods but have a hard time aligning political uncertainty with overall equity returns.
BoE quantifies the effect of political shocks on economic output, the threat of a cyber attack is ranked as the top security concern for the second consecutive year by the CFR’s foreign policy experts.
Macroeconomic Effects of Political Risk Shocks (Bank of England, 34 page read) The BoE finds that increased polarisation and partisan conflict in US politics does negatively impact growth and asset markets. Their study looked at the period 1980 until today.
Conflicts to Watch in 2020 (Council on Foreign Relations, 5 min read) Among the top risks to watch for this year are “disruptive cyberattacks on US critical infrastructure, including electoral systems”, “an armed confrontation between the US and Iran”, and “a severe crisis between Russia and Ukraine following increased fighting in the contested areas / Eastern Ukraine” according to the CFR’s annual Preventive Priorities Survey.
Obama, Trump Tie as Most Admired Man in 2019 (Gallup, 2 min read) President Trump, got 1st place for the first time. He was joint first with former US President Obama (12 years at #1). Results partly reflect the significant party divide in the U.S. Michelle Obama won the female spot for the second year in a row.
UK election results were a surprise to most. Under the hood, it was as much as Labour loss as Conservative win. Elsewhere in Europe, it appears that lack of employment opportunities is a better guide to discontent than age or wealth.
Election Analysis in The Maps and Charts (BBC News, 3 min read) Prime Minister Boris Johnson’s Conservatives have a majority of 80 seats. A series of interactive maps and charts displaying the regions and categories of gains of losses made by each party. Notably, Labour lost more votes in remain areas than the Conservatives. Labor have had their worst return of seats in any general election since 1935; losing votes in every region in the UK.
The Geography of Discontent (Vox EU, 8 min read) Rather than age, wealth, or education, this new research finds that anti-EU sentiment stems from a combination of long-term industrial decline, lower employment and less educated workforce. Importantly, while education remains important, the lack of employment opportunities ranks as high [Bearish euro]
Voters are paying less attention to the business cycle and many politicians aren’t following the scripted path of earlier leaders.
How the Economy Affects Our Vote (econlife, 2 min read) Recent paper that analyses voting patterns in the US and Europe shows that voters are influenced by more than Inflation, GDP and unemployment. The variables that hold more sway over voters’ behaviour are automation, globalization and housing prices. [Bullish populism]
Macron Alone (Project Syndicate, 4 min read) Macron’s recent Russia-centric actions may risk alienating him from his core pro-EU allies, specifically Germany, which favour a more measured and restrained approach to diplomacy rather than Macron’s off-the-cuff style.
Economies in East Asia should be proactive on policies to avoid Latam like social unrest and what do Michael Bloomberg’s philanthropic endeavours indicate?
East Asia’s Political Vulnerability (Project Syndicate) Korea University professor Lee Jong-Wha argues that East Asian countries could follow the path of Latin American instability unless policymakers change their policies. He argues the case for economic policies that reduce inequalities but are balanced with fiscal sustainability. [Bearish East Asia]
What Mike Bloomberg’s giving says about Mike Bloomberg (Axios) Bloomberg has donated to support numerous social development causes. This could help reveal his likely policies. His major causes include controlling the use of tobacco, tackling climate changes, road safety, and urban development
The hype around social media caused right-wing populism could be overstated. Meanwhile, the lefts big plans for healthcare spending could lead to less military spending. And ever wondered when protests turn into revolutions?
Why Elizabeth Warren’s Foreign Policy Worries America’s Allies (The Atlantic) It appears that Warren’s “Medicare for All” campaign will come at the expense of defense spending. This move is making foreign allies nervous.
Do Social Media Drive the Rise in Right-wing Populism? (Marginal Revolution) A recent research shows that in France, the UK and the US, increased use of social media did not contribute to the increase in popularity of right-wing candidates. [Bullish social media]
We Live in a World of Upheaval. So Why aren’t Today’s Protests Leading to Revolutions? (The Conversation) History professor Peter McPhee concludes six key characteristics for social movements to become revolutions. The major unrests we see in 2019 don’t check all the boxes as it’s hard for all parties involved to remain united around their core objectives.
Trade wars are the obvious source of geopolitical tensions. But we should add conflict over water and also over mobility – remember the Chile protests were triggered by rising costs of public transport.
The Growing Threat of Water Wars (Project Syndicate) More geopolitical conflicts are about access to water resources. However, most of these conflicts take place between developing economies, and many advanced economies still maintain water-consumption habits that won’t alleviate the global water stress.
Quantifying the Unemployment Effects of Trump’s Protectionist Policies (VOX EU) Researchers conclude that repealing NAFTA and the bilateral tariffs between the US and Mexico would reduce welfare by 0.31% in the US and by 6.6% in Mexico. However, evidence also shows that Canadianworkers are slightly better off as a result. [Bearish Mexico]
When Markets and Mobility Collide (Project Syndicate) Harvard Professor Ricardo Hausmann reflects on the recent Chilean protests over an increased metro fare. He concludes that this “market adjustment” on access to public goods and services – i.e. public transportation – is unfair to the economically disadvantaged population.
Congress, Nord Stream II, and Ukraine (The Brookings Institute) Steven Pifer argues that sanctioning parties that are involved in the construction of the Nord Stream II pipeline doesn’t make much difference. But the Congress could still amend legislation to help Ukraine take advantage of its position as a transit country for Russian gas. [Bullish gas]
Trump is casting a shadow of uncertainty on markets – he hasn’t yet signed an agreement to roll back trade tariffs on China and his impeachment proceedings can fly in either direction. Similarly, across the pond in the UK, Conservatives are scrambling for support in the North.
Did Trump’s Trade War Impact the 2018 Election? (Blanchard, Bown, Chor) Academics find trade war accounted for one-tenth of the observed nation-wide decline in Republican House candidates’ vote share between 2016 and 2018. Largely driven by retaliatory tariffs on agricultural products.
The 7 Ways Impeachment Could Shape The 2020 Election(Fivethirtyeight) Things could go in a number of directions – Trump could lose everything, but outcomes can also lead to utter chaos and destruction for the Democrats.
Can the Conservative Party Win in the North of England? (The Conversation) The Conservative’s strategy of appealing to the “Workington Man” in North England oversees the demographic complexity of this region and may not be as effective in the face of the upcoming UK election. [Bearish GBP]
We Are Finally Getting Better at Predicting Organized Conflict (MIT Technology Review) Shows the anatomy of “conflict models” and how it computes a “risk score” to assess the probability of social conflicts in a region. Such models successfully forecast the September 2018 conflicts in Ethiopia.
Yesterday, the Fed cut rates for the third time this year. The persistent low rate environment seems to be a cause of bubbles forming after all. The least central bankers can do is help reduce carbon emissions – ‘Green QE’ is all in.
When Yields Talk, Sectors Listen (Advisor Perspectives) Low interest rates impact not only bonds but equity valuations too. And some sectors are more rate sensitive. Financials suffer whereas Utilities, Consumer Staples, and Healthcare outperform. [Bullish these latter sectors]
Herd Behaviour in Asset Markets: The Role of Monetary Policy(VOX) Argues against economist Robert Shiller’s findings that bubbles are random and unpredictable and instead finds they are closely linked to loose monetary policy. [Bearish stocks]
Jens Weidmann: Climate Change and Central Banks(Jens Weidmann)Discusses ways in which central banks can be involved in transitioning to a low-carbon economy. Heavy focus on green finance or ‘Green QE’, however, might distract from the main policy objectives and hinder bank independence. [Bearish green bonds]
We looked at how populism is turning left-wing in one of our specials this week. This might be holding true for Eastern Europe too, as some excellent Brookings analysis points at. Elsewhere, we picked out a curious list of the financiers attending “Davos in the desert”.
Is the Tide Turning Against Right-Wing Populism and Nationalism in Central Europe? (Brookings) Argues that the uniting of opposition parties is a key strategy to the diminishing power of right wing in European politics. Could support rise of left populism = less business friendly = lower stocks
The Grandees Headed to Saudi Arabia’s “Davos in the Desert” (Axios) Axios compiles the list of guests who will attend the Future Investment Initiative in Riyadh later in October – heads of state, high-profile Trump administration cabinet members, executives of the world’s largest financial institutions and will.i.am all made it to the list. Saudi unaffected by human rights issues.
U.S. Military Could Collapse Within 20 Years Due to Climate Change (Vice) A Pentagon research report highlights several climate-trigged factors that could be detrimental to the US Military in the upcoming two decades: a collapse of the power grid, disease epidemic and geopolitical tensions stemmed from climate-related population displacement.
Trump is likely to get away with it this time. At least, according to a great piece comparing his impeachment process to that of Nixon’s . Meanwhile, with Extinction Rebellion protests globally, we re-cap the negative externalities of climate change and how to tackle them.
Trump and Nixon: Three Key Differences Between 2019 and 1974 (The Conversation) Differences include Nixon’s impeachment process started in the Senate not the House, Republicans and Trump loyalists dominate today’s Senate unlike Nixon’s time and the media is more fragmented than earlier.
Anti-globalisation Bias and Public Policy (Project Syndicate) Argues that a number of anti-globalisation negative biases, most commonly nationalism, self-interest, and lack of economic understanding, result in misguided public policies.
The Necessity of Climate Economics (Project Syndicate) Re-visits the main economic concepts of negative externalities as ways to tackle climate change.
Geopolitics has taken a centre stage recently, especially with the climate movement across major cities. A few insightful pieces exploring how to try and respond to it.
High Finance is Wrecking the Economy and the Planet – but it Won’t Reform Itself(Prospect Magazine) Criticizes FT’s new campaign that aims at resetting rentier capitalism as meaningless and toothless. It does agree, however, that capitalists are searching for new ways to revamp capitalism as political insurgencies, protectionism and authoritarianism all threaten globalisation.
Free Trade is Expanding, Just Not With the US(Council on Foreign Relations) Highlights that despite countries accounting for more than a third of global output signing more than a dozen trade agreements in the last two years, the US chooses to stay on the sidelines
The Climate Risk You May Not be Thinking About (McKinsey Global Institute) Argues that the most significant risk of the current climate change predicament is not weather itself but our lack of adaptation to today’s volatility. Plenty of examples of one extreme event such as a storm significantly disrupting output.
Greta Thunberg’s Moment(Project Syndicate) Explores the mass movements of civil disobedience started by Thunberg and criticizes the failure of Governments to react.
Impeachment is all the focus now, bringing us back to the years of Clinton. It’s unlikely to lead to much, however. We compare how Republicans are performing in light of re-election hopes and how Trudeau lost his reputation – slowly, then all at once.
The Impeachment Trap (Project Syndicate) Argues that Democrats have made a mistake to call for Trump’s impeachment, hoping to follow Clinton’s experience. Trump retains the loyalty of his base supporters and enjoys majority support in the Senate. It’s been a info-leaky administration – nothing new was learned about Clinton after the Starr Report was issued, and nothing new will be learned about Trump.
Looking at America’s Two Economies (Econlife) Analyses the state of the economy in the Republican states in comparison to Democrats. In 2008, the Republican median HH income, at $55,000, was higher than the Democrats. By 2017, Democrats were up to $61,000 and Republican voters were down to $53,000. Argues that this is because with Democrats increasingly clustered in affluent coastal urban areas, they also represent a bigger share of productivity, education and better paying jobs than their opponents.
Justin Trudeau’s Spectacular Self-Destruction(Foreign Policy)Gives an insight into Justin Trudeau’s stunning fall from grace, with approval ratings of just 31% down from more than 60% in 2016. Not only has he been underdelivering on his promises, (despite millennials favouring his legalisation of cannabis) but he also backtracked from his pledges to revamp the electoral system. Far from his initial appeal of being a change maker, he is now seen as a run-of-the-mill politician.
Europe Needs a Migration Reset (Project Syndicate) Argues that Europe needs a rethink on how to handle the floods of migrants as camps are overflowing. Four actions – better secure external borders, handle economic and asylum migrants separately, repair the migrant distribution system to member states and forge stronger ties with countries of origin.
Political and Economic Drivers of Pogroms (VOX) – Analyses the interaction of political and economic factors to drive pogroms in an anti-semitic environment. The authors find that massacres occurred when economic downturns coincided with political upheaval. One of their key findings also indicate that occupational segregation between Jews and the mass played a significant role in triggering ethnic violence.
Six Small Facts About Globalization That Are Really Big (econlife) Highlights six key ingredients for globalisation: 1) refrigerated containers, 2) WTO, 3) Low non-tariff barriers , 4) FDI, 5) Services are important, 6) Mexico becoming important.
Companies Are Using a Depression-Era Law To Escape Trump’s Tariffs — And It’s Costing Them (ProPublica) An old law that allows free trade zones with the US is being revived
The Growing List of U.S. Government Inquiries into Big Tech (Axios) Lists the number of inquiries against Facebook (5), Google (4), Amazon (2) and Apple (1)
Why Global Trade Imbalances Could Get Worse Before They Get Better… (CFR) Argues that europe’s demand deficit and Asia’s excess savings are driving trade surpluses against the US. Their trends are not positive. Could keep trade wars in the headlines.
Tracking Global Corporate Tax Avoidance (Big Picture) 40% of multinationals profits are shifted to tax havens each year. This surely will be attacked by politicians.
US foreign policy has been changing since the height of interventionism during the Bush years. Now Trump may be setting the tone for years to come. Meanwhile, the UK may need to focus on trade deals with the US, Aust, Canada and NZ and we shouldn’t forget Ireland is key for Brexit.
How Trump is Remaking Republican Foreign Policy (Defense One) Out: neoconservatism and noninterventionism. In: a reactionary style that may outlast his administration.
Beyond Brexit – What a US-UK Trade Deal Will Really Look Like (CAPX) Argues for UK to focus on US and the broader 5 eyes alliance (Canada, Australia, NZ)
A Repeat of The Turmoil of 1914-1922? (Progressive Pulse) Compares the current dilemma of the Irish Backdrop Plan to the 1914 Crisis of the UK, where Ireland sought to break away from UK control and regain its sovereignty.
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