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September 23, 2004

United States
The currency strategist at Morgan Stanley might want to talk to the chief economist at Morgan Stanley

Steve Johnson’s market insight column in Thursday’s Financial Times keys off Morgan Stanley’s currency strategist Stephen Jen’s argument that "As long as Asia insists on staying inside this dollar ar…

October 13, 2004

United States
Oil and the US current account deficit

Oil above $50 a barrel is not good for the U.S. trade balance. Higher oil prices are a tax on US consumers, with the proceeds pocketed by oil exporters. If oil stays above $50 in November and Decem…

November 19, 2004

Greenspan, part II

Federal Reserve Board Chairman Alan Greenspan was careful to frame the risk created by rising US external debt for foreigners investing in the US (and in the process financing the US current account …

January 26, 2005

Financial Markets
China reads the Economist. Is the Renminbi undervalued?

While China’s delegation to Davos seems a bit less than enamored with the dollar, the People’s Bank of China seems have read last week’s Economist, and concluded that there is no need to change the …

January 30, 2005

Financial Markets
Stephen Jen might want to rejigger his model

Apparently, Mr. Jen thinks the dollar -- despite the United States’ 6.2% of GDP current account deficit -- is significantly undervalued against all major currencies, and fairly valued against most As…

February 1, 2005

United States
One number to watch

My nomination for the single number that best captures the state of total’s world economy -- and a key risk going forward: The annual increase in central banks dollar reserves.It is not exactly a num…

February 24, 2005

Monetary Policy
An Asian OPEC?

A less kind headline might be "Asian policy makers meet, agree to continue manipulating foreign exchange markets" Still, this Bloomberg article (link thanks to Calculated Risk) suggests that there ma…

February 26, 2005

Capital Flows
Geoeconomics: What can we learn from the end of the “real” Bretton Woods system of fixed exchange rates?

Dan Drezner started a post with the Triffin dilemma, so I figure I too can digress into the realm of history.The Bretton Woods system of fixed exchange rates (Bretton Woods 1) collapsed, in some sens…

March 8, 2005

Financial Markets
I hope Andy Xie is wrong about this

Xie argues that Chinese prices won’t converge to US levels; rather US prices are likely to need to fall to Chinese levels.When a small economy like South Korea begins to develop, it is quite reasonab…

March 22, 2005

Financial Markets
The $1.3 billion question: What will happen to the renminbi

A week in China certainly does not make me an expert. Like many, I see China through the filter of English-speaking Chinese economists, and, to more precise, through the filter of those economists a…