Benn Steil

Geo-Graphics

A graphical take on geoeconomic issues, with links to the news and expert commentary.

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China, not Piketty, Explains “Confused Signals” in U.S. Asset Prices

by Benn Steil and Dinah Walker
china drives down treasury yields

The FT’s Ed Luce recently took on the “confused signals” being sent by U.S. stock and bond prices moving in sync (upward).

Which is it, he asks?  Are economic prospects good, as stock prices suggest, or bleak, as bond prices suggest? Read more »

Paul Krugman’s Baltic Bust—Part III

by Benn Steil and Dinah Walker
Does Paul Krugman Still Believe in “Icelandic Miracles”?Photo Courtesy of Daniel Williams Does Paul Krugman Still Believe in “Icelandic Miracles”?
Photo Courtesy of Daniel Williams

Geo-Graphics posts in July 2010 and 2012 showed that Paul Krugman’s devaluation-driven “Icelandic Miracle” was nothing of the sort – a figment of his having chosen the most favorable possible starting date (Q4 2007) for his Baltic (and Irish) economic-performance comparisons.  Move it forward or back, and Krugman’s story collapses like a warming arctic ice shelf. Read more »

Draghi’s Dilemma

by Benn Steil and Dinah Walker
ecb rate vs national rates and inflation

The Governing Council of the European Central Bank meets on May 2, with a possible rate cut in the offing. Yet a rate cut is not the no-brainer the Bank’s critics often suggest, as today’s Geo-Graphic shows.

The ECB’s official inflation-rate target is “below, but close to, 2%.” Both Portugal and Greece have inflation under 1% , but the transmission mechanism from ECB rates to business borrowing rates in those two countries has been virtually severed by the crisis. In short, they need a rate cut, but the ECB can’t deliver them one. Read more »

Even Slowing China Is Fueling Global Growth

by Jon Hill
2012.1.30.ChinaGrowthPerPt

China’s economy slowed from a growth rate of 10.3% in 2010 to 9.5% in 2011 (and a 2000s peak of 14.2% in 2007), prompting fears that China could trigger a global slowdown.  Yet at 10% of world output, 2.5 times what it was in 2001, the Chinese economy is now so large that it will continue to make a significantly rising contribution to global growth even if its own growth rate continues to fall off moderately.

Read more »

The Holidays Are Coming Late

by

The economic crisis has shrunk the holiday season, which typically lasts for about 35 days. Happy regions-those in which real estate markets have held up relatively well-have seen their holiday season decline by 10 days. Sad regions-those that have suffered a large number of foreclosures-have lost 24 days. To restore some cheer, we have collected some links that provide a lighter take on the economic crisis. Read more »