As Congress still swoons over the anti-Kremlin Magnitsky narrative, Western political and media leaders refuse to let their people view a documentary that debunks the fable, reports Robert Parry. By Robert Parry Updated Aug.
The article explores how expansionary fiscal policy by the U. The Age of Secular Stagnation: Most observers expected the unusually deep recession to be followed by an unusually rapid recovery, with output and employment returning to trend levels relatively quickly.
Almost no one in imagined that U. Had economists been told such monetary policies lay ahead, moreover, they would have confidently predicted that inflation would become a serious problem—and would have been shocked to find out that across the United States, Europe, and Japan, it has generally remained well below two percent.
Yet long-term interest rates are still remarkably low, with ten-year government bond rates at around two percent in the United States, around 0. Such low long-term rates suggest that markets currently expect both low inflation and low real interest rates to continue for many years.
With appropriate caveats about the complexities of drawing inferences from indexed bond markets, it is fair to say that inflation for the entire industrial world is expected to be close to one percent for another decade and that real interest rates are expected to be around zero over that time frame.
In other words, nearly seven years into the U.
The economies of the industrial world, in this view, suffer from an imbalance resulting from an increasing propensity to save and a decreasing propensity to invest. The result is that excessive saving acts as a drag on demand, reducing growth and inflation, and the imbalance between savings and investment pulls down real interest rates.
In this conception, even though China’s absolute military capacities are not formally equal to those of the United States, Beijing possesses the ability to pose unacceptable risks in a conflict with Washington and is developing increasingly sophisticated means to negate traditional U.S. advantages. China's rapid military and economic growth has fuelled a steady stream of analysis and debate about the PRC's motivations and objectives regarding the United States. Hawaii's source for local news headlines. In-depth coverage of Hawaii news from your trusted daily newspaper. Call NEWS () to subscribe today!
When significant growth is achieved, meanwhile—as in the United States between and —it comes from dangerous levels of borrowing that translate excess savings into unsustainable levels of investment which in this case emerged as a housing bubble. All of these have some validity, but the secular stagnation theory offers the most comprehensive account of the situation and the best basis for policy prescriptions.
Excess savings tend to drive interest rates down, and excess investment demand tends to drive them up.
Secular stagnation occurs when neutral real interest rates are sufficiently low that they cannot be achieved through conventional central-bank policies.
At that point, desired levels of saving exceed desired levels of investment, leading to shortfalls in demand and stunted growth.
This picture fits with much of what we have seen in recent years. Real interest rates are very low, demand has been sluggish, and inflation is low, just as one would expect in the presence of excess saving.
Absent many good new investment opportunities, savings have tended to flow into existing assets, causing asset price inflation. For secular stagnation to be a plausible hypothesis, there have to be good reasons to suppose that neutral real interest rates have been declining and are now abnormally low.
And in fact, a number of recent studies have tried to look at this question and have generally found declines of several percentage points. Even more convincing is the increasing body of evidence suggesting that over the last generation, various factors have increased the propensity of populations in developed countries to save and reduced their propensity to invest.
Greater saving has been driven by increases in inequality and in the share of income going to the wealthy, increases in uncertainty about the length of retirement and the availability of benefits, reductions in the ability to borrow especially against housingand a greater accumulation of assets by foreign central banks and sovereign wealth funds.
Reduced investment has been driven by slower growth in the labor force, the availability of cheaper capital goods, and tighter credit with lending more highly regulated than before.The Diplomat is a current-affairs magazine for the Asia-Pacific, with news and analysis on politics, security, business, technology and life across the region.
This edition reviews recent market moves and outlines Deutsche Bank Research's key views moving forward. Read on for our recap of the global macro outlook, key recent/upcoming political developments (US election, Brexit, Italy, etc.) and major risks in the rest of Analysis the role of China government in regulating the safety and health in China Coal Mine Industry China US relations China's tenous relations Financial Statement Analysis Between China Mobile And China Unicom china Analyse The Challenges Facing The Mnes In China.
Illustrate With Any Mnes Which Are Actively Operating In China. Instead we – in the land of the free, home of the brave – are protected from seeing this documentary produced by filmmaker Andrei Nekrasov who was known as a fierce critic of Russian President.
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China was chosen due to the restrictive and closely scrutinized nature of its Internet, in contrast to the internet in United States which has significantly more freedom and protected by the freedom of speech and expression.