For the past three months, markets have been worrying about the future of countries in the European Union, and more particularly within the zone that uses the euro. The euro has fallen consistently against the dollar and euro denominated bond yields of southern European countries have risen to heights at which financing budget deficits becomes […]

As anyone who has played “Diplomacy” knows, the economic and political world from 1871 to 1914 was one of Mancihean struggle, with countries attempting to establish spheres of influence behind high tariff barriers, and multiple power centers between which war was by no means impossible. As the mildly social democrat Nirvana of the 1990s recedes […]

I have been predicting for some time now that the inflation-suppressing effect of globalization would soon come to an end, with unpleasant results for all the cheap-money western economies. The decision by the Taiwanese contract manufacturer Foxconn to raise wages in its 300,000-employee Chinese factory by 30%, with an additional 66% to be paid as […]

Capitalism is a matter of incentives, on management, politicians, investment managers, financiers and oil company executives. Sometimes they run in the same direction as rational free market theory would indicate. More often, in this increasingly complex world of big government, globalization, fast computers and dangerous projects, they don’t. To get the global economy to work […]