Mar 18, 2013 09:02 UTC

China’s new market watchdog may lack teeth

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By John Foley

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

As head of China’s new market watchdog, Xiao Gang has a tough mission: to bite the hand that fed him. While head of Bank of China, he oversaw an unprecedented lending spree that helped get China’s economy out of a hole. His next mission, as boss of the China Securities Regulatory Commission, will be to beef up the country’s capital markets – weakening the big banks’ stranglehold.

Mar 15, 2013 06:34 UTC

Fed harder to grade than banks on stress tests

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By Antony Currie

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

It’s harder to grade the Federal Reserve over its handling of the stress tests than it is the 18 banks which take them. On the face of it, the regulator has devised a rigorous but fair system. This year, it rapped Goldman Sachs and JPMorgan over the knuckles for their flawed models, though still approved their plans to return capital to shareholders. It vetoed proposals by Ally and BB&T, and gave its blessing to former dunce Bank of America. But the Fed’s math and much of the results remain a secret. That makes some of the toughness seem more for show.

Mar 14, 2013 03:28 UTC

Abenomics can clear Japan’s demographic hurdle

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By Andy Mukherjee

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

Japan has a serious demographic disadvantage: its population is both shrinking and ageing. But the situation is not so dismal – at least not yet – that it will wreck Prime Minister Shinzo Abe’s plans to revive the economy.

Mar 13, 2013 15:21 UTC

Russia’s central bank can avoid “putinisation”

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By Pierre Briançon

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

Elvira Nabiullina has the worst possible credential for the job of head of the Russian central bank: she is a close ally of Vladimir Putin. The former economy minister, currently the Russian president’s chief economic adviser, will take the new post in June. Her appointment has been greeted with some scepticism.

Mar 13, 2013 08:16 UTC

China’s solar bonds leave dim hope of payback

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By John Foley

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

Dim prospects for payback await bondholders in China’s Suntech Power Holdings. The stricken solar panel maker, unlikely to meet a $541 million bond payment due on March 15, has persuaded over half its foreign creditors to hold off for two months. On purely financial grounds, it’s hard to see how the bondholders could come away with anything in the event of a default. What value remains is a bet that China values foreign investors too much to snub them outright.

Mar 11, 2013 04:54 UTC

China starts 2013 the way it can’t hope to go on

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By John Foley

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

China began 2013 with the same old economic model. Growth for the first two months of the year was driven mainly by exports and real estate. The increase in construction appears to have been fuelled by credit. The current trajectory can continue only by pumping ever more leverage, and risk, into the system.

Mar 8, 2013 15:13 UTC

Review: The massacre of Britain at Bretton Woods

By Martin Hutchinson

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

Benn Steil calls his study “The Battle of Bretton Woods” but in reality the 1944 conference which created a new financial system after World War Two was more of a massacre of British interests by the U.S. Treasury’s Harry Dexter White.

COMMENT

This is viewing history with today’s perspective. 1944 was the time when the world war was at the beginning of the end. In reality Japan and Germany were defeated by the industrial and military might and resolve of the USA. Why should not Bretton Woods be skewed toward the USA, at that time in history? The world situation is certainly different now. The downfall of Bretton Woods was due to the devaluation of the dollar because of the unrestrained spending of the US government in the sixties. Emerging market countries are playing a larger global economic role and should have more input. Maybe we need a Bretton Woods II given the impacts of today’s dollar, euro, and yuan.

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Mar 8, 2013 05:48 UTC

China’s currency inflows could be illusory

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By John Foley

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

China’s currency is a fickle measure of confidence in the country’s fortunes. For much of 2012 the yuan stagnated, causing investors to hold back on previous bets on its appreciation. Recent data suggests they have been piling back in to the Chinese currency – but that may not last.

Mar 7, 2013 15:07 UTC
Edward Hadas

UK policy rhetoric flies in the face of reality

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By Edward Hadas

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

When words and actions don’t match up, the problem is usually overly ambitious promises. In the debate on economic policy in the UK, the failure is in the present – the government’s description of fiscal and monetary policy flies in the face of reality.

Mar 6, 2013 07:58 UTC

Southeast Asia is wrong to neglect inflation risk

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By Andy Mukherjee

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

Inflation in the Philippines reached a five-month high in February; prices rose the most in 20 months in Indonesia. Yet, there is no word from the central banks of Southeast Asia’s fast-growing nations on when they are likely to raise interest rates. While their coyness to signal policy tightening is understandable, it is nevertheless a mistake.