Analysis

The illusions driving up US asset prices

Speculative markets have always been vulnerable to illusion. But seeing the folly in markets provides no clear advantage in forecasting outcomes, because changes in the force of the illusion are difficult to predict.
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Trumpian Uncertainty

Every January, I try to craft a forecast for the coming year. Economic forecasting is notoriously difficult; but, notwithstanding the truth expressed in Harry Truman’s request for a one-armed economist (who wouldn’t be able to say “on the other hand”), my record has been credible.
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The Next Migrant Wave

Imagine that you are a farmer. Your crops are withering as weather patterns become more volatile, your well water is too salty to drink, and rice is too expensive to buy at the market. So, you leave home in search of a better life.
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Will Europe let Germany lead?

The United Kingdom’s Brexit vote, Italian Prime Minister Matteo Renzi’s referendum defeat and subsequent resignation, and Donald Trump’s election as President of the United States have created a power vacuum in the West, and in Europe.
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The threat to global banking standards

The concrete consequences of this enthusiasm were the creation of the Financial Stability Board (FSB), born out of the ashes of the Financial Stability Forum, at the G20’s London summit in April 2009, and inclusion of representatives of all G20 members among the key rule makers in Basel and elsewhere.
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The crisis of market fundamentalism

The biggest political surprise of 2016 was that everyone was so surprised. I certainly had no excuse to be caught unawares: soon after the 2008 crisis, I wrote a book suggesting that a collapse of confidence in political institutions would follow the economic collapse, with a lag of five years or so.
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The coming Brexit tragedy

This past year changed everything, except how governments think. Nowhere is that more apparent than in the pre-negotiations for Brexit. With both sides ignoring the far-reaching implications of Donald Trump’s election as US president – namely, the decline of the liberal world order – the process seems set to produce a tragedy for the United Kingdom and the European Union alike.
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Theresa May’s Brexit problem

British Prime Minister Theresa May reportedly “needed some time to compose herself” in a recent meeting with her presumed ally Angela Merkel. The German Chancellor categorically rejected May’s proposal to do a “side deal” on European Union nationals living in Britain before the United Kingdom officially triggers Brexit negotiations by invoking Article 50 of the Treaty of Lisbon.
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How climate action can Make America Great

Climate change is the single biggest challenge facing humankind. Yet the next president of the United States – the world’s second-largest greenhouse-gas emitter and a critical actor in climate policy – does not believe it is happening, or at least that humans have a role in driving it.
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Stalking a killer fungus

Warnings of the rise of so-called superbugs – disease-causing microbes that are resistant to many (or all) antibiotics – have been coming thick and fast in recent years. What many people seem not to realize is that superbugs are already here – and they are already killing people.
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Italy on the Brink

Political instability in Italy is nothing new. But Italian voters’ rejection of constitutional reforms in a referendum has not only led Prime Minister Matteo Renzi to resign; it has dealt another blow to a crisis-ridden European Union. In the near term, Italy’s ongoing banking crisis could flare up again and threaten European stability; in the longer term, Italy may have to leave the eurozone, which would put the single currency itself at risk.
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The New Xenophobia

Democratic governments in the West are increasingly losing their bearings. From the shift toward illiberalism in Poland and Hungary to the Brexit vote in the United Kingdom and Donald Trump’s victory in the United States’ presidential election, a particularly lethal strain of populism is infecting societies – and it is spreading.
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