Trumponomics would not be as bad as most expect

Finance

In markets it is known as the “Trump trade”, a bet that Donald Trump’s return to the White House would herald more inflation and higher interest rates. Many of Mr Trump’s core policies push in this direction: tariffs would add to import costs, deportations of immigrants could push up wages and deficit-financed tax cuts would […]

Betting markets are useful when politics is chaotic

Finance

In the early 20th century, for brief periods, the most frenetic American trading pits were not the raucous markets in which stocks were traded, nor the venues where bonds were exchanged. The real action was in the market for betting on the next president. “Crowds formed in the financial district…and brokers would call out bid […]

Europe prepares for a mighty trade war

Finance

“We cannot carry on trade without war, nor war without trade,” wrote Jan Pieterszoon Coen, a brutal governor-general of the Dutch East India Company, to shareholders in 1614. Four centuries later, things sound a bit different. “Let’s make no mistake: assertiveness is a prerequisite for keeping our markets open,” says Sabine Weyand, the EU’s top [&h

The dangerous rise of pension nationalism

Finance

Rachel Reeves, Britain’s new chancellor, says that she has inherited the worst fiscal circumstances since the second world war. An exaggeration, perhaps, but only a small one. To address the squeeze, Ms Reeves will seek the help of Britain’s retirement savings. On July 8th she said that she wants the country’s pension funds “to drive […]

How strongmen abuse tools for fighting financial crime

Finance

In May 27 members of the Community Empowerment Resource Network (CERNET), a Philippine charity, were charged with bankrolling communist rebels. Straight away the case looked strange. A social-media post by police claimed they had jailed Estrella Flores-Catarata, one of CERNET’s associates, who received an award from the UN for her work with indigen

How much cash should be removed from the financial system?

Finance

The world is still, in a sense, swimming in cash. Or at least the electronic equivalent: central-bank reserves. The Bank for International Settlements (BIS), a club of central banks, estimates that the balance-sheets of rich-country central banks amount to roughly 50% of collective GDP. That is down from 70% in 2021—a reduction which reflects quant

How Starbucks caffeinates local economies

Finance

Starbucks offers endless opportunities for innovation. Parts of social media delight in hacking the chain’s menu to create highly instagrammable drinks. Fancy a “cake batter Frappuccino”? Simply order a “vanilla bean crème Frappuccino”, add a pump of hazelnut syrup and ask the barista to put a cake pop in the blender. How about some “liquid [&helli

Why Chinese banks are now vanishing

Finance

The savings and loan (S&L) crisis terrorised America’s banks for years. Starting in the mid-1980s, a mix of aggressive lending growth, poor risk controls and a property downturn contributed to the collapse or consolidation of over 1,000 small lending institutions. China’s smallest banks are now suffering from many of the same ailments. But unti

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