Amidst all the discussion about rampant Chinese GDP growth, the appropriate conduct of macro policy in restraining that growth, and the implications for the components of aggregate demand, a simple question leads to complicated answers.
Ethanol and food price volatility
If this is what we get in a good year, what will happen when we have a bad crop?
“We have always thought that America got away with something.”
Well, maybe not anymore. And perhaps not even before.
The quote is from an article on how the weak dollar is raising the costs of traveling to Europe, as the USD/EUR rate flirts with 1.40. The longer quote, from yesterday’s NYT article entitled “As Dollar Crumples, Tourists Overseas Reel”
, is:
Bernanke on the economic outlook
In testimony before the U.S. Congress yesterday, Fed Chair Ben Bernanke continued his policy of greater openness and transparency for Federal Reserve policy, trying to lay out clearly what the Fed is most worried about.
Iraq update
Expenditures continue to rise. More appropriations will likely be needed at this pace.
Is OPEC relevant?
Are OPEC’s recent decisions responsible for the current price of oil? I’m not persuaded that they are, and here’s why.
More on the Yuan and the Chinese Trade Balance
More speculation on the Yuan’s prospects. From Bloomberg:
More ideas on construction employment
Here are some of the thoughts from other analysts about why reported residential construction employment has not been plummeting.
Import prices surge…
…but mostly due to increasing oil prices.
A Tipping Point for the Dollar?
In a post over a year ago, I observed that the relative stability of the dollar would come to an end as a confluence of events occurred. Those would be the end to rises in the US interest rates, and the continued increases in policy rates abroad, especially in the euro area and the UK, against a backdrop of a massive current account deficit that requires large and continuous infusions of saving from the rest of the world (and indeed consumes most of the world’s excess saving).