IMF Urges Nations to Fix Domestic Imbalances Independently
1/15 IMF: "If coordination proves difficult, the best course of action for each country is clear: start addressing domestic imbalances now, regardless of what others do." This is one of several discordant lines in an otherwise interesting paper. https://t.co/Yn79aOWNzr
Finance Wars Shaped America: Hamilton Triumphs Over Egalitarians
I just finished William Hogeland's fascinating book on the struggles over finance and credit during the formative period of the US republic, during which time radical, egalitarian movements were, for better or worse, defeated by financial elites. Alexander Hamilton may not...
US External Deficits Mirror Unsustainable Domestic Borrowing
1/7 Martin Wolf, in an important piece on unsustainable current account imbalances, makes a point that most American economists miss: "the counterpart of external deficits tends to be unsustainable domestic borrowing." https://t.co/h7ob7Aac6A via @ft
China's Bad‑Loan Market Grows Amid Squeezed Bank Margins
China Daily notes that non-performing loan disposals are rising, suggesting that China is slowly developing a bad-loan market, even as record low net-interest margins make it harder for banks to recognize bad loans. https://t.co/UhXgPDv3nE
China Urges Balanced Growth of Imports and Exports
1/3 Xinhua: "China has sent fresh signals of promoting more balanced development of imports and exports. A recent commentary article in the Qiushi Journal called for concrete steps to balance import and export growth." https://t.co/eO90uuquzA
Canada Seeks to Grow Financial Services in China
1/12 Bloomberg: "Canada pitched expanding its financial services presence in the Chinese market as the northern nation aims to increase exports to its second-largest trading partner in a push to diversify from the US." https://t.co/MifJtmoDWc
China’s Urban Rail Investment Slumps 34% in 2026
1/4 Caixin: "Investment in China’s urban rail networks is set to plunge nearly 34% in 2026, the fifth consecutive year of declining capital expenditure, as local governments struggle with mounting operating losses and tighter project-approval requirements." https://t.co/s0B8GEvatW
Top Developers' Sales Drop 23%, Existing Market Revives
Caixin: "Sales by China’s top 100 real estate developers plunged roughly 23% year-on-year in the first quarter of 2026. The prolonged slump in new home sales contrasts with a nascent rebound in the existing home market of major cities like...
China Book Review Announces 2025 Nonfiction Shortlist
China Book Review's shortlist for the 2025 Award for Outstanding Nonfiction Book on China https://t.co/08lsjdMCVJ
China Adds Household Income Boost to Top Policy
1/12 Caixin: "For the first time, China has embedded a dedicated plan to raise household incomes into a top-level national policy document, signaling a change in priorities as policymakers grapple with persistently weak consumer spending." https://t.co/ynrYu49v8R
Q1 2026 Dim Sum Issuance Rises 14% to 400bn Yuan
Caixin: "For the first quarter of 2026, dim sum issuance totaled nearly 400 billion yuan, up 14% from a year earlier." https://t.co/yksX2koWPr
French Biography Reexamines Mao’s Successor, Hua Guofeng
China Books Review has an interesting review of a recent French biography of Hua Guofeng, Mao's successor.
GDP Growth Differs Under Hard Vs. Soft Budget Constraints
In my latest piece for Carnegie, I explain why GDP growth in economies that mainly operate under hard budget constraints is not comparable to GDP growth in countries, like China, in which a large part of the economy operates under...
China Clamps Down on Consumer Lending, Forces Lower Rates
Interesting Caixin article on China’s intensifying crackdown on the consumer lending and loan-facilitation business, with regulators summoning major platforms for talks and pressing the industry to sharply curb borrowing costs. https://t.co/BIv3i5trGx
China to Top CNY400 Bn R&D Spend by 2026
Yicai: "Beijing's expenditure on science and technology is expected to break through CNY400 billion (USD58 billion) for the first time in 2026, with a greater emphasis on basic research, as the country ramps up funding to drive innovation and strengthen...
Chinese Solar Makers Raise Prices, Market Remains Stagnant
Yicai: "Leading Chinese manufacturers of solar modules have raised the prices of their products, as China is lifting the 9 percent rebates on the export value-added tax for photovoltaic products. However even as large manufacturers have raised prices, the market...
China Must Shift From Export Model to Balanced Trade
1/5 SCMP quotes Qiushi as saying "the inherent traits of China’s economy dictate that the export-driven model relied upon during its phase of outward-oriented accumulation is unsustainable, making the push for balanced trade development inevitable." https://t.co/E39ctbmg5R
Undervalued RMB Functions Like Massive Trade Tariff
Good Setser thread on a recent report on global imbalances. By the way, if the RMB is indeed 20-30% undervalued, that is the functional equivalent of a 25-43% tariff on all imports and a 20-30% subsidy on all exports. The Trump...
Europe Lacks Hamiltonian Power Without Central Tax Authority
Jacques de Larosière writes that "anyone who believes that Europe is close to a Hamiltonian moment has fallen victim to self-delusion. In fact, despite diverse external pressures for the Europeans to become a more powerful strategic force in the world,...
Middle Powers Rally to Fill US Void in Global Trade
1/6 FT editorial: "Other governments have not done much to play the role the US once did of seeking to anchor the world trading system. Mark Carney, Canada’s prime minister, and others have been talking about an alliance of middle powers...
China's New Home Prices Tick up in March
Reuters: "China's new home prices edged up in March, reversing a decline in the previous month, supported by a seasonal pickup in demand in major cities. New home prices in 100 cities rose 0.05% from a month earlier after falling...
1926 British General Strike Lessons Echo Today
1/12 On the centennial of Britain's 1926 general strike, the FT reviews three new books that discuss and explain the events that year. I haven't read them (although I'd love to do so), but it is worth noting what those events...
China Accelerates Local Debt Cleanup via Central Debt Swap
1/4 Yicai: "China’s local debt cleanup is moving faster, with the central government’s debt swap program simultaneously lowering borrowing costs and shrinking the implicit debt pile." https://t.co/Ru3dUFDjL5
China SOE Profits and Taxes Slip Despite Modest Growth
Xinhua: "China's SOEs saw their total revenue rise 0.2 percent year on year in the first two months of 2026, while total profits fell 2 percent and total tax payments fell 2.3 percent." This in an economy that grew nominally by...
WTO's Yaoundé Setback Signals Need for Fundamental Reform
1/9 The FT argues that the WTO was further wounded in the recent Yaoundé meeting. This was probably inevitable. Unless the WTO arranges a transformation of its role in global trade, it is hard to see its continuing relevance. https://t.co/1Xy5w1ESZZ
BoE Warns Industrial Policy Can Fuel Harmful Trade Surpluses
The Bank of England continues to be among the few major central banks to warn about the adverse effects of persistent trade imbalances. Although most models used by economists assume that trade is balanced, or is unbalanced only temporarily before...
CITIC's 2025 Record Profits Fueled by Trading Gains
For those interested in how members of the "national team" may have performed in the current stock market rally, Caixin notes the CITIC posted record-high revenues and profits in 2025, driven by proprietary trading and "financial investment". https://t.co/KXtyuP8mil
Xi's Push for Intensive Growth Faces Execution Hurdles
Good Damien Ma piece on Xi Jinping's efforts to shift the Chinese economy from extensive growth (generate growth by increasing labor, capital and resource inputs) to intensive growth (generate growth by using labor, capital and resource inputs more efficiently). For...
Two Distinct Causes Behind Last Year's Manufacturing Job Decline
1/5 Good Chris Griswold piece on the implications of the decline last year in manufacturing jobs. I would add one other thing, and that is that there are two completely separate reasons for a decline in manufacturing jobs.
China Mulls Loosening Investor Limits to Aid Banks
Reuters: "China is considering easing shareholding restrictions for some major investors, people with knowledge of the matter said, in a move aimed at broadening capital-raising options for commercial banks reeling from an economic slowdown." https://t.co/HCdl6eFRCX
Singapore Sees China as Engine for Regional Growth
1/6 Bloomberg: "“Singapore believes China can play a bigger role in supporting regional prosperity and stability,” Singapore Prime Minister Lawrence Wong said at the Boao Forum. “Its vast domestic market can be a powerful engine of growth for the region.” https://t.co/npbm7nXQEo
China Claims Right to Counter Mexico's Tariff Hikes
1/9 Reuters: "China said that Mexico's trade measures against it, including tariff increases, constitute trade and investment barriers and that it had the right to take countermeasures." rld/china/china-says-it-has-right-retaliate-against-mexicos-tariff-hikes-2026-03-25/
China’s Growth Model Hinges on Weak Consumption, Excess Investment
The East is Red provides a translation of a very interesting essay by Wang Xiaolu, Deputy Director of the National Economic Research Institute. The problem with the Chinese economy, Wang says (and as I have argued for over a decade), is...
Fed Says China's Exports Driven by Constrained Household Consumption
1/5 This new paper by the Fed concludes that China's export success stems from weak domestic demand "rooted in structural features of China's economy and financial system—particularly those that constrain household consumption." https://t.co/jplDeN5d6g
Dollar’s Global Dominance Fuels US Deficit Persistence
Joseph Gagnon: "The most persistent driver of US deficits is the attractiveness of US financial assets to foreign investors owing to the central role of the dollar in international transactions and to the perceived safety and creativity of US financial...
Chinese Automakers Outsell Japanese Rivals Globally for First Time
Xinhua: "Chinese automakers have surpassed their Japanese counterparts in global vehicle sales for the first time, marking a significant shift in the global automotive industry." https://t.co/PtNMiJISii
PBoC Governor Says Global Deficits Unchanged in 40 Years
1/4 I am a little surprised by these comments from the governor of the PBoC. According to Yicai, yesterday he said that "the world’s major deficit countries are the same as 40 years ago because of the inherent flaws in the...
IMF Urges China to Boost Consumption, Cut Subsidies
IMF First Deputy Managing Director Dan Katz: "China can do more to increase consumption and domestic demand—especially for services—by boosting household incomes and reducing incentives for precautionary savings. That means shifting resources away from industrial subsidies and infrastructure." https://t.co/2Rvhxa5jsN
European Trade Pressures Analyzed in New Spanish Article
A recent piece by Enrico Fardella and me on European trade pressures, translated into Spanish by Agenda Publica https://t.co/5AEY665Tjb
China's Premier Acknowledges Trade Surplus Amid Export Surge
1/4 Bloomberg: "Chinese Premier Li Qiang has responded to growing calls from trading partners to address a rising trade surplus, with China’s exports continuing to surge in the first two months of the year." https://t.co/EMOs1RWaAX
Princeton Keynote Explores Debt, Deficits, Global Imbalances
Four weeks ago I was a keynote speaker at Princeton's Annual JRCPPF Conference. The topic this year was "Debt, Deficits & Global Imbalances". For those who might be interested (and there were some brilliant presentations), this video provides the links. https://t.co/BhKUkeJVQb
Over Half of Chinese Car Dealers Lose Money in 2025
Caixin: "The China Automobile Dealers Association said in a report that 55.7% of dealerships lost money last year, up 14 percentage points from 2024, as intense competition forced them to sell vehicles below cost." https://t.co/5TsYQRNMxx
Chinese Automakers Target 2026 Overseas Sales to Counter Domestic Slump
Caixin: "Major Chinese carmakers are setting ambitious overseas sales and localized production targets for 2026 to offset a cooling domestic market." https://t.co/P0EUxL3lEN
China's Trust Sector Abandons Risky Real‑Estate Debt Model
Caixin: "Driven by a regulatory crackdown on risk in the financial system, China's multitrillion-dollar trust industry is being forced to abandon its old, highly profitable model of funneling funds into non-standard debt for real estate projects and local governments." https://t.co/eN5eDafjR4
China, US Pledge New Mechanisms to Boost Trade
People's Daily: "China and the US agreed to explore the establishment of working mechanisms to expand economic and trade cooperation, continue to make good use of the China-U.S. economic and trade consultation mechanism, strengthen dialogue and communication, properly manage differences,...
China's Fixed-Asset Investment Grows 1.8% Early 2024
1/8 Caixin: "China’s fixed-asset investment (FAI) returned to growth in the first two months of this year, rising 1.8% year on year, beating expectations as infrastructure spending jumped." https://t.co/cCOIgPDXNn
New Interview Reveals Outlook for China's Economy
I was interviewed two weeks ago by Mark Sobel at OMFIF about the outlook for the Chinese economy. It just came out. https://t.co/d6LFlYcl14
EU Urged to Leverage Market for Concessions From Fragile China
1/6 SCMP: "The European Union has been urged by the EU’s official think tank to weaponise its giant market to draw concessions from China, whose economic fragility is making it increasingly reliant on rich export markets." https://t.co/haMEakKlUZ via @scmpnews
China's CPI Surges, Deflationary Trend Reverses
1/6 China's deflationary environment continues to improve, with high-than-expected numbers in February. CPI inflation was 1.3% year on year and 1.0% month on month. Month-on-month inflation has been positive since December and mostly positive since July. https://t.co/gpaBJ53yli
Global Debt Hits Record High, Driven by China, US
SCMP: "Global debt climbed to a record high in 2025, rising at the fastest pace since the pandemic, with China and the United States accounting for a large share of the increase, according to a new report." https://t.co/GSQFwnXnb0