The last two issues of Economic Perspectives drew on observations made while I was on a month’s visit to South Africa, during which time the Finance Minister, Pravin Gordhan, presented his annual Budget to Parliament in Cape Town. He was robustly resistant to calls from a variety of special interest groups for more welfare spending than his budget could extend to, and I could see that his unwavering steadfastness amid all that clamour was putting his personal position at risk.
Responses to previous instalments of my “Economic Perspectives” include queries on why unbridled credit expansion by the main central banks in USA, UK, EU and Japan does not appear to be reflected in a commensurate rise in the general price level, affecting all sectors of the economy.
As an economic term, “inflation” is shorthand for “inflation of the money supply”.
But for the general public it is usually felt as “rising prices” – which is not surprising since one of the common effects of an increase in the money supply is higher prices.
Central bankers continue to “stimulate” growth by applying the twin practices of quantitative easing (QE) and lowering interest rates. It’s clear that these policies simply don’t work – but the real surprise is that they continue to persist with them, and do not give up.
The cause of vastly inflated executive remuneration is the same as that which lies behind every other “bubble”…
Blindness of French labour laws When I was recently on holiday in the South of France the socialist government of Francois Hollande was obliged to take the unusual step of by-passing democratic means of getting his labour reform measures into law. He resorted to the rarely invoked “executive power”, to force through changes in labour […]
Much has been made of Britain’s current account deficit, which is the amount by which our imports of goods and services exceed our exports. But don’t be fooled to look at it in terms of exports as “good” and imports as “ bad”.