Breakingviews

Kuroda does what he can for BOJ’s inflation goal

By Andy Mukherjee

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The Bank of Japan’s new chief has dumped his predecessor’s timid script. Haruhiko Kuroda has crafted an ambitious new plan to end the country’s chronic deflation.

U.S. auto sales put brakes on economy’s detractors

By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

U.S. car sales are putting the brakes on the economy’s detractors. Americans are buying more vehicles thanks in part to pent-up demand and cheap loans. But the housing recovery helps, too. That and other economic data suggest consumers are looking beyond slimmer paychecks. Federal spending cuts allowing, that means the U.S. engine may be about to purr.

Welcome to another year of the Great Stagnation

By Edward Hadas

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Remember the Great Moderation? Before the financial crisis, economists thought they had found the recipe for steady GDP growth from here to eternity. But almost five years after a banking collapse and a Great Recession, recovery remains tepid in the world’s rich countries. It is the Great Stagnation.

China shadow bank curbs attack symptom not cause

By John Foley

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)

China is getting tough on shadow banks, but not on the causes of shadow banking. New rules will force mainstream lenders to cap their exposure to some of the riskier off-balance sheet products they have sold to customers – in particular, those that are effectively repackaged corporate debt. That limits a big source of risk for banks, but creates a new one for the Chinese economy.

UK’s new bank capital tsar starts as good cop

By George Hay

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The UK’s new bank capital tsar has started life as a good cop. The Financial Policy Committee, created to monitor macroeconomic risks facing domestic lenders, has ordered banks to raise 25 billion pounds by the end of the year. That’s a lot, but it could have been worse.

Chinese credit alarms sound in the east

By John Foley

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)

Credit alarm bells are ringing in China’s east. Earnings from three of the country’s top four lenders show that while the national ratio of bad debts to loans is still falling, stress is building in coastal regions. Problems in an area rich in private sector businesses and manufacturing could be a national concern.

China retailers stumble in pursuit of growth

By John Foley

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)

China’s growth can be disruptive as well as lucrative. GOME and Li Ning, two of the country’s biggest retail brands, have both reported slumping sales and losses in a market that seems to be expanding. Shifting consumer habits have made competition fierce and profitability elusive.

The first oligarch dies, his kleptocracy thrives

By Pierre Briançon

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Boris Berezovsky built something that lasted. The man found dead on March 23 may have been alone, broken, bitter, and a shadow of his flamboyant former self as Russia’s richest man and king-maker. Yet the system he invented two decades ago in the throes of the big Soviet meltdown is functioning well. The men at the top may have changed, and turned against their former mentor and master. But the rulers of today’s Russia – both the oligarchs who looted the country’s resources and branched out, and the clique of ex-KGB officials working hard to get their hands on a share of the loot – are Berezovsky’s children.

Abandoned gold loans are India’s “jingle mail”

By Andy Mukherjee

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The myth that Indians’ love for gold is driven by tradition rather than financial self-interest has been dashed. Falling prices have prompted borrowers who took out loans secured against the yellow metal to break a cultural taboo and abandon their collateral. It’s the Indian equivalent of American homeowners who walked away from their underwater mortgages by mailing the keys to their homes to the bank.

Cyprus will struggle to make gas math work

By Kevin Allison
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Cyprus’ latest ideas for wiggling out of its financial fix include bundling future gas revenues into a national “solidarity fund”. But Breakingviews calculations suggest the gas discovered to date isn’t worth enough to plug the country’s 5.8 billon euro ($7.5 billion) funding gap.