Promises of High-Level Talks on Korean Reunification
Disasters and political scandals dominated South Korean politics in 2014. And hopes for progress on North–South relations on the Korean peninsula were left unfulfilled.
Category: Economics
Obama Budget Harnesses Cheap Multiplier Effect
Obama’s $4 trillion budget depends on lower inflation, as the president hopes more spending on the middle class will stimulate demand and growth throughout the economy.
The new budget includes a number of initiatives that drive spending slightly higher than the prior budget, while assuming that the Consumer Price Index will rise 1.4% in 2015, down from the 1.7% increase in 2014. The budget assumes inflation will reaccelerate in 2016, where prices will rise by 1.9% before reaching the Fed’s target rate in 2017, when prices expect to rise 2.1%.
Another Central Bank Eases and Grexit Talk Subsides
The Reserve Bank of Australia joined the chorus of central banks to ease policy. The 25 bp rate cut was not a major surprise but it did catch many a bit off-guard as recent data and the pace of the Australian dollar’s decline had prompted many to push out the expectation to next month.
Testing Central Bank Balance Sheet Limits
When the Swiss National Bank lifted its cap on the franc, many thought they understood the message. It had reached the end of its rope. Some suggested the ownership structure of the SNB (owned by the Swiss cantons and individuals vs the stock exchange) opposed a further expansion of its balance sheet (~80% of GDP) vs ~20-25% in the UK and US by comparison.
A Full Slate of Economic Data and Currency Movement Start the Week
The US dollar is mixed. It has recovered from an early spike to JPY116.65 in early Asia to test the JPY117.80 area. The euro briefly dipped below $1.1300 before Spanish and Italian PMIs surprised on the upside. Sterling bounced on a stronger PMI report but hit a wall of selling that pushed it back toward $1.50 before bids returned. The dollar-bloc is mixed.
U.S. GDP Growth Disappoints, Retail Sales Fall
Cheap oil was supposed to boost consumer spending, but instead consumers spent less as incomes fell. According to the Bureau of Economic Analysis, U.S. GDP grew at just a 2.6% annual rate in the fourth quarter of 2014, far below expectations of 3%.
How Accurate was Western Media’s Coverage of the Hong Kong Protests?
For the West, democracy is not only a core value but also represents the best possible form of government for all nations. This notion determined how the Western media perceived, interpreted and covered events in the 2014 Hong Kong protest.
Kazakhstan: Measuring the Northern Aral’s Comeback
The water level continues to rise in the Northern Aral Sea thanks to the Kokaral Dam and 13-kilometer dike at the southern edge of the recovering lake. As the northern part of the Aral Sea, once the world’s fourth-largest lake, continues to expand, the fishing industry is slowly returning as well.
Thanks to one of the worst manmade environmental disasters in recorded history, the Aral Sea is disappearing. But a small section of the sea in the north is reviving – and fish are returning.
Does the UN Need a New Approach Toward North Korea?
The UN needs a new strategy to address human rights violations in North Korea: a strategy that goes beyond a simplistic dichotomy of good versus bad and right versus wrong.
U.S. Housing Weakens Despite Lower Unemployment Claims
Although unemployment claims have fallen to their lowest point in fifteen years, home sales are tumbling as price gains make homes unaffordable for millions.
Throughout 2013 and 2014, housing saw steady price gains while low interest rates, which fell markedly throughout 2014, encouraged more homebuyers to the market. That trend may be meeting resistance, causing home sales to tumble as flat wages and high prices make real estate unaffordable for many.
