News and Analysis: 18-29 Aug 2014 | EmergingFrontierMarkets.com

Based in: Manila, Philippines

Posted on Fri, 29 Aug 14:

Looming ahead -- 5 Nobel Laureates look ahead, Finance & Development, Sep/Nov '14:
Five Nobel Laureates discuss what they each see as the biggest problem facing the global economy of the future: "A second inconvenient truth," by G Akerlof; "The unresolved crisis," by P Krugman; "Affluent economies stuck in neutral," by R Solow; "Enabling and adapting to developing economy growth," by M Spence; and "The economy should serve society," by J Stiglitz

Zhuang: Bridge the income gap to create a future Asia's poor deserve, FT, 6 Aug 14 [courtesy Asian Dev't Bank]:
Asia's past successes in reducing poverty are under threat. More than 80% of Asians live in countries where inequality is widening. The same forces that drove the region's rapid growth for the past 30 years--globalization, new technology and market reform--are widening the gap between rich and poor, writes Bank's dep chief economist

Coffers: Burton Malkiel -- Indexing and the 2014 "stock-picker's" market, Wealthfront (blog), 21 Aug 14:
In Jan of this year it was widely believed '14 would be a "stock-picker's" market. While the S&P 500 index of large US stocks produced an extremely generous return of more than 30% in '13, an indexing strategy was deemed unlikely to be effective in '14, writes author of A Random Walk Down Wall Street / Princeton emeritus prof

Posted on Wed, 27 Aug 14:

John Cochrane: A few things the Fed has done right, WSJ, 21 Aug 14 [courtesy Hoover Inst]:
As Fed officials lay the groundwork for raising interest rates, they are doing a few things right. They need a little cheering, and a bit more courage of their convictions. The Fed's plan to maintain a large balance sheet and pay interest on bank reserves is highly desirable for a number of reasons--the most important of which is financial stability, writes Inst senior fellow / U Chicago prof

Nancy Birdsall: Getting energy prices right - Smart but..., Ctr Global Dev't (blog), 4 Aug 14:
The smart answer is to make higher energy prices 'revenue-neutral', that is, to somehow return the resulting revenue to the people. But successful tax shifting schemes in industrial nations rely on reducing payroll, income, and corporate taxes -- while most workers in developing nations are in the informal sector and don't pay such taxes. Instead, they pay consumption and other indirect taxes, writes Ctr pres

D Lombardi and H James: What enabled Bretton Woods?, Project Syndicate, 8 July 14 [via Ctr Int'l Governance Innov]:
The proximity of the 70th anniversary of the Bretton Woods (BW) conference, which established the World Bank and the IMF, to historical anniversaries like the Allied landings in Normandy highlights just how ambitious its organizers were. Indeed, the confab aimed to create a stable int'l monetary framework, write Ctr global economy prog dir; and Princeton historian (Photo: BW historical marker)

Posted on Mon, 25 Aug 14:

Nobel-winning economists challenge conventional thinking on recovery, Guardian (blog), by P Inman, 24 Aug 14:
Any gathering of economists since the financial crash has usually been an occasion for blinkered self-justification. In the Bavarian town of Lindau, where 18 Nobel laureates gathered last week along with 450 int'l graduate students, the previously meek response of those who criticize conventional thinking had grown louder. Princeton's Christopher Sims threw the 1st punch

Home currency issuance in global debt markets, Fed Res Bank San Francisco, by Hale, Jones, & Spiegel, 18 Aug 14:
The situation where firms and gov'ts face difficulties borrowing in their home currencies in int'l capital markets is sometimes referred to as 'original sin'. It reflects the problem that, if foreign investors are reluctant to lend in the borrowers' home currencies due to fears about future econ instability, the resulting hard currency debt would increase the likelihood of such instability

(Ed.'s Note: Using the same software for the 2 linked pieces above, we could NOT put a proper link on the article below. Since we don't like our choices being censored -- by a gremlin or whoever -- here then is the link:
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Graziano da Silva: How to dramatically reduce hunger - even in very poor countries, Thomson Reuters, 20 Aug 14:
Some 60 developing nations have reduced the proportion of their populations experiencing chronic hunger by half or brought it to under 5%, meeting or exceeding int'l goals. Experience shows that three types of initiatives have been crucial to sustain progress on food security and nutrition, writes UN Food Agric Org dir-gen

Posted on Fri, 22 Aug 14:

Ebola threatens to hobble three countries, $13 billion in GDP, Businessweek, 21 Aug 14:
Sierra Leone's prospects were bright before the worst-ever outbreak of the virus. The economy was expected to grow this year almost 3 times faster than the average for sub-Saharan Africa. In neighboring Liberia and Guinea, rich iron-ore deposits were luring billions of dollars in foreign investment. The disease now threatens to cripple the three economies

Beyond China - where Asian growth is, Columbia Univ, 23 June 14:
For investors and deal-makers, there is ample opportunity beyond China and India. Even taking the two giant economies out of the equation, "Asia will remain the world's most dynamic region," says the IMF Asia dept director. Still, he warned "now is not the time to be complacent" and cited seven risks that could derail Asia's momentum

The argument for targeting Nominal GDP in developing countries, Harvard U, 5 Aug 14:
Jeffrey Frankel argues that central bankers in mid-sized middle-income nations should target Nominal Gross Domestic Product, as opposed to targeting the nation's money supply, exchange rate, or inflation. He argues that, as a result, central bankers are "not faced with a choice between abandoning the target and hurting the economy" (Nominal GDP targeting in developing countries, Vox EU)

Posted on Wed, 20 Aug 14:

No Fed fireworks, but plenty of clues, expected at Jackson Hole, Reuters, 18 Aug 14:
Policy makers will discuss at length their thinking about the labor markets of major economies at the 21-23 Aug meeting in Jackson Hole, Wyoming, perhaps dropping clues about the path for monetary policy in the months ahead. The spotlight will be on Janet Yellen, who will speak on Fri in her 1st appearance at the meet as Fed chair (2014 agenda--Re-evaluating labor market dynamics)

Barry Eichengreen: Banking on the BRICS, Project Syndicate, 13 Aug 14:
There is no reason why the 'New Development Bank' should create problems. With initial capital of just $100 bil., it is too small to make a major contribution to global infrastructure needs. But inadequate capitalization can be corrected over time. The 'Contingent Reserve Arrangement', however, is another story, writes fmr IMF senior policy adviser / U Calif.-Berkeley prof

Coffers: How does your theory of markets shape your portfolio?, Yale U, May '14:
Investors put financial theory into practice every day. How efficient are markets? Can market participants advantageously match their capabilities to the right investments or leverage an information advantage? A panel of asset managers, moderated by Yale's Roger Ibbotson, discusses how they see the theories playing out in real markets

Posted on Mon, 18 Aug 14:

Charles Kenny and Casey Dunning: What's the point of the post-2015 agenda?, Ctr Global Dev't (blog), 13 Aug 14:
The UN Open Working Group on Sustainable Dev't Goals completed its outcome document a few weeks ago, putting forth 17 goals and 169 targets. But for all the space devoted to targeting almost every conceivable area of global progress, there was one topic on which the working group was notably silent: what's the purpose of all of this?, write Ctr senior fellow; and senior policy analyst

Iwan Azis: Asia's elevated risks, Business Times (Singapore), 30 July 14 [courtesy Asian Dev't Bank]:
Even as economies become more interdependent, national policy continues to rule, irrespective of its spillovers to other nations. No example is more illustrative of these trends than the introduction of ultra-easy money policy in industrial economies. This 'financial nationalism' led to massive capital flows into emerging markets, writes Bank's Ofc Regional Econ Integration head

M Feldstein and R Rubin: The Fed's systemic-risk balancing act, WSJ, 11 Aug 14 [courtesy Harvard]:
The low yields on Treasury bonds have led to reaching for yield in many ways. This needn't mean that the asset prices are excessive, but the combination of their dramatic increase in price, the low volatility and the reaching for yield by investors and lenders suggest that the risk of excesses has increased substantially, write Pres Reagan's Council Econ Advisers chair; and Pres Clinton's Treasury secy

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