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September 11, 2006

The Wall Street Journal (finally) takes note: Europe, not the US, explains the recent surge in China’s exports

I was tempted to title this blog “$18.8 billion more reasons for Tyler Cowen, Dan Drezner, Greg Mankiw and a host of others to think the RMB isn’t really undervalued.”  But that would be a bit…

September 10, 2007

Financial Markets
US monetary policy: right for the US, wrong for the dollar zone?

The US economy is faltering, at least a bit, on the back of the troubled housing market.   Uncertainty surrounding the value of debts backed by subprime US mortgages has created more than a bit of tu…

November 20, 2007

Financial Markets
A little too late …

China's premier,  Wen Jiabao, has joined the chorus voicing concern about the dollar's recent weakness.   Cheng Siwei comments two weeks ago seem to reflect rather widespread worries among Ch…

November 17, 2006

Monetary Policy
The world, in a single graph

Actually, this post should be titled “everything I think I know about the world, in a single graph.”   The following graph combines various measures of dollar reserve growth with data on the overa…


December 19, 2006

Emerging Markets
Andy Mukherjee should get an award for the most prescient financial column of the month of December -

The title of his December 15th column was “Asian central banks may spook investors in 2007.” He mentioned China, India and South Korea.    Thailand seems to have beat them all to the punch. Mukh…

December 1, 2008

Monetary Policy
Bretton Woods 2 and the current crisis: any link?

Last week, I attended a conference on international financial reform. These kinds of conferences don’t really produce consensus; there is no need to agree on anything. But there was a sense -- a…

September 12, 2007

United States
A savings glut, not an investment drought -

So argues Ben Bernanke.   His basic argument is very simple.  The emerging world now has a large and growing current account surplus that finances a large and growing current account defic…

January 12, 2006

United States
US November trade data

$64.2 billion is not $68.1 billion.   But it is still kind of large.   Another $65 billion deficit in December, and the annual trade deficit will reach $726 billion.   That works out to a fourth quar…

January 13, 2007

United States
The more the dollar falls, the more dollars you need to buy …

That, more or less, is the conclusion of “portfolio balance” models of global capital flows.    The dollar tanks.   Its share of your portfolio falls.   So sell euros (or RMB) and buy dollars to keep…

December 12, 2006

United States
Trade deficit seems to have stabilized, at least if oil stays at its current levels

I don’t think the deficit stabilized just because of the headline fall in the trade deficit.   The deficit is down $9.6b from its August peak largely because the US oil import bill has fallen by $7.6…