Category Archive: 5) Global Macro

What a strong US dollar means for the world economy

Our editor-in-chief Zanny Minton Beddoes takes us behind this week’s cover to discuss the sharp rise of the dollar of late, and why its surge could pose problems for the world economy. For more videos, visit our YouTube channel https://www.youtube.com/theeconomist

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Six Narratives on the Ascendancy of Trump

A remarkably diverse array of "explanations" of Donald Trump's presidential election victory have been aired, representing both the conventional political spectrum and well beyond.

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Which country was the first to decriminalise all drugs? | The Economist

Today the UN commission on narcotic drugs meets in Vienna. It does so against a backdrop of increased decriminilisation in many parts of the world, but which was the first country to go all the way? Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 Which country was the first to decriminalise all drugs? …

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Are street drugs getting purer? | The Economist

Street drugs are getting purer. As part of the Daily Watch drugs week we explore the market forces contributing to the rise in potency Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 Many drug users today are getting more than they may have bargained for. Why are people getting higher? It’s simple market …

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The World If … drugs become legal

As part of the Daily Watch ‘drugs week’ we explore what the world might look like if legalisation replaces the failing war on drugs. Join Tom Wainwright, Britain editor of The Economist and author of Narconomics, as he predicts what would happen to the cartels Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 …

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Emerging Markets: Week Ahead Preview

EM ended last week on a somewhat firmer note, though we note divergences remain in place. For the week, ZAR and KRW performed the best while TRY and BRL were the worst. US jobs data Friday will draw some attention, though a December Fed rate hike is pretty much fully priced in.

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Why Is the US Dollar Rising?

Note the apparent breakout above 100 and the constructive similarities to the 2014 breakout that was followed by a 20% increase in the purchasing power of the USD relative to other currencies.

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The New Nobility Uses Political Correctness to Fragment the Precariats

Combine identity politics with political correctness, and the New Nobility/Oligarchy can laugh their way to the bank while their pawn-serfs fight over how many politically correct angels can dance on the head of a pin.

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How Do We Create Value When Knowledge Is Almost Free?

Credentials are increasingly in over-supply; problem-solving skills are scarce. How do we create value in an economy that is increasingly dependent on knowledge? The answer is complicated by the reality that knowledge is increasingly digital and "unownable" and therefore almost free. Financialization as a substitute for creating value has run its course.

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Emerging Markets: What has Changed

Philippine President Duterte will reportedly ask central bank. Governor Tetangco to stay on for a third term. South Africa’s government has proposed a national minimum wage. Fitch moved the outlook on South Africa’s BBB- from stable to negative. Turkey’s central bank surprised markets with a 50 bp hike in its benchmark repo rate to 8.0%. Political risk in Brazil is rising as President Temer’s top aide was implicated in an influence peddling...

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Could volcanoes counter climate change? | The Economist

Three years ago today, Mount Sinabung, one of Indonesia’s most active volcanoes, unleashed volcanic ash up to 16,400 feet. It has erupted again on multiple occasions since. The searing gases released by volcanoes like Sinabung can have one surprising impact on the planet Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 Global warming …

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Healthcare: Inflation Hidden in Plain Sight

Charles Hugh Smith shows how health care costs are exploding in the United States and how this will lead sooner or later to inflation.

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Sykes-Picot: Carving up the Middle East | The Economist

In 1915 British diplomat Mark Sykes described for The Economist the battle underway in the Middle East. A few months later he carved up control of the region with his French counterpart Francois George Picot. The impact of the secret agreement they reached is still being felt today Click here to subscribe to The Economist …

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Philip Hammond’s plan to help JAMs to stimulate Britain’s economy

Philip Hammond, Britain’s chancellor, makes his first autumn statement today on the government’s tax and spending priorities. Our word of the day considers the target of his plans to stimulate the economy: the citizens who are “just about managing”, otherwise known as JAMs. Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 Daily Watch: …

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Why Reshore Manufacturing? It’s the Only Way to Avoid Defective Pirated Parts

If you want to lose your brand, your pricing power and your customers, by all means, rely on a global supply chain filled with defective parts that cannot possibly be detected. Reshoring the entire supply chain so it can be trusted is the low-cost solution once you add up the total lifecycle costs of a hopelessly counterfeit global supply chain.

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Bloodhound’s attempt to break the world land speed record | The Economist

An attempt will be made to drive faster than the speed of sound—at 800mph—and break the world land speed record. Click here to subscribe to The Economist on YouTube: http://econ.trib.al/rWl91R7 In October 2017 the eyes of the world will be on the Kalahari Desert. At South Africa’s Hakskeen Pan, the Bloodhound Supersonic team will attempt …

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The Age of Disintegration: Political Disunity and Elites At War

Historian Michael Grant identified profound political disunity in the ruling elite as a key cause of the dissolution of the Roman Empire. Grant described this dynamic in his excellent account The Fall of the Roman Empire. The chapter titles of the book illuminate the complex causes of profound political disunity in the ruling elite: The Gulfs Between the Classes: a.k.a. soaring income/wealth inequality: check.

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Emerging Markets: Week Ahead Preview

EM FX ended the week on a soft note, as higher US rates continue to take a toll. EM policymakers are getting more concerned about currency weakness, with Brazil, Malaysia, Korea, India, and Indonesia all taking action to help support their currencies. If the EM sell-off continues as we expect, more EM central banks are likely to act to slow the moves.

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Emerging Markets: What has Changed

Malaysia appears to have enacted a subtle change in FX policy. Turkey cut foreign currency reserve requirements in an effort to increase the supply of foreign exchange. Brazil’s central bank suspended the sale of reverse currency swaps and started selling new regular swaps (equivalent to selling USD). Colombia reached a new peace agreement with FARC rebels. Mexico's central bank hiked cash rates by 50 bp.

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The Great Con: Political Correctness Has Marginalized the Working Class

So when the protected class of well-paid institutional "progressives" speak darkly of "reversing 40 years of social progress," what they're really saying is we're terrified that the bottom 95% might be waking up to our Great Con of identity politics and political correctness. To understand the Great Con of political correctness, we must first grasp the decline of the working class (self-described as "the middle class"), i.e. those who must sell...

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