As the World gets bigger it seems to become more volatile. So, its financial markets ride an endemic 8/9-year roller-coaster with dizzying, white-knuckle peaks occurring in 1972, 1981, 1989, 1998, 2007/08 and now maybe again in 2015. Once more disappearing money flows are the culprits behind crashing stock markets. Are we no longer slaves to […]
At the Institute of Directors, we believe that markets generally perform better when intervention from politicians is kept to a minimum. So it may surprise readers of CapX to hear that we’re calling for a dose of state support to help more of our fledgling start-ups get the investment they need. Market failure is often […]
For as long as I can remember I have been reading financial reports about the coming ‘hard landing’ in China – and explanations from the financial wizardry as to why there won’t be a hard landing as long as the Communist Party is in charge and in funds. Earlier this week it seemed that the […]
1. What has happened in the last 24 hours? – Bauke Schram, International Business Times “The big slump came as the Shanghai Composite lost more than 8% on Monday, causing other stock markets to nose-dive as well. After the Dow dropped more than 1,000 lower, investors all over the world panicked, although many markets corrected […]
It is holiday season. It is the time of the year when we have the chance to sit back and think about the bigger picture. It is the time of the year when we get a rest from the minutiae of daily life. It is time to feel human again. If you are an economist, […]
It says a lot about the power China wields in our global economy that the West has gone into mild panic at the prospect of China’s growth slowing down. Whilst many countries in the EU are still fighting the reality of recession, the idea of growth, even if it’s slowing, is but a mere pipedream. […]
Private schools for the poor are growing rapidly throughout the developing world. The Economist has a review: Private schools enroll a much bigger share of primary-school pupils in poor countries than in rich ones: a fifth, according to data compiled from official sources, up from a tenth two decades ago (see chart 1). Since they are often unregistered, […]
Though the recent slump in the Chinese stock market should be seen within a limited context, there is a strong and growing likelihood of a major financial crash starting in China before, inevitably, spreading globally. The main reason for this is that China has channelled enormous borrowing into the creation of excess capacity, which is […]
Cue hysterical outrage. The UK government is selling the first slice of its majority shareholding in the state-owned bank RBS and there is anger from some politicians who should know better and on social media from people furious that the sale is taking place at a “loss”. The row is utterly absurd, although not surprising […]
Commodities aren’t the sexiest parts of global finance, and not many of the young thrusting finance types starting their careers in banking this summer will want to find themselves researching copper mines and the long-term sustainability of Berar’s cotton fields. Yet oil, copper and steel are the stuff of the global economy; they are particularly important to developing countries, […]
It is always easy to snipe at a state leader’s foreign tour, and Barack Obama’s trip to Africa was no exception. He was criticised for visiting a Kenyan president who only recently – and questionably – evaded the International Criminal Court for inciting political violence, then was condemned for claiming a despotic regime in Ethiopia […]
What? The U.S. territory of Puerto Rico, located in between the Caribbean Sea and the Atlantic Ocean, faces a mounting debt crisis. The self-governed island inhabited by a population of around 3.6 million people has an estimated municipal debt of $72 billion, a debt Governor Alejandro Garcia Padilla described as “not payable”, in what is […]
Never mind a return to the Drachma, Greeks seem to be voting with their feet and adopting Bitcoin, the virtual currency which is one of the best performing asset classes in the last week or so. At the time of writing in the immediate aftermath of the Greek No Vote, it is trading at $273, […]
A few billion here, a few billion there, and pretty soon you’re talking serious money. If you combine the highly-developed capacity of the financial markets for misbehaviour with the regulatory appetite for ever tougher sanctions, you quickly get to some very big numbers. In the context of this drip feed of relentless scandal – whether […]
As the horrible troubles of Greece unwind towards their conclusion there remains one question that no one seems to ask. How on earth did anyone think the Greek economy was worth buying at a premium price in the first place? It was not so long ago that many thought just that. Investment pros will tell […]
If you haven’t heard what investors call the “Africa Story”, here it is. Africa south of the Sahara is on a roll. The once debt-ridden disaster zone of the world economy is back on its feet, and fighting. Sub-Saharan Africa is now growing faster than any other region of the world: from bankruptcy to boom […]
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