Last week’s inflation figures showed that the Fed’s over-expansionary monetary policy wasn’t showing itself in inflation. But that doesn’t mean it’s doing no damage. Instead of in inflation numbers, the multiple years of ultra-low Fed interest rates are manifest in savings figures for both individuals and companies, with individual savings at half the long-term average […]

The Fed last Wednesday did not even remove the “considerable period” from its language about when it might start raising interest rates, thus delaying the likely start of rate rises even further than expected. This repeats its mistake of 2004-06, when it raised the federal funds rate at only ¼% per meeting, undertaking 17 such […]

The bicentenary of the Congress of Vienna, organized to settle the questions outstanding from the 22-year Napoleonic Wars, is a slightly uncertain date. The Congress itself opened officially on October 1, 1814 and the Final Act was signed on June 9, 1815, but on the other hand the British Foreign Secretary Robert, Lord Castlereagh arrived […]

No less than six sovereign borrowers are now paying negative nominal interest rates on their two-year borrowing in euros – in other words they are making money by going into debt. In real terms, medium-term US TIPS and British index linked gilts have had negative interest rates for several years. Contrary to the views of […]

“We wanted flying cars, and they gave us 140 characters” said venture capitalist Peter Thiel in 2011. He put his finger on a central dilemma of the New Economy: its innovations can make money (usually through redirecting advertising sales) but they add little or nothing to the overall stock of human knowledge or long-term happiness. […]