The full economic impact of the sixth most powerful earthquake ever recorded is not yet known. Many hundreds of lives have been reported lost in Japan. Aftershocks are a danger and other nations fear a tsunami running across the Pacific will spread the damage more widely. Though uncertainty is rife, the earthquake is more likely to add to global growth and attendant inflationary pressures than subtract from them. It also raises concerns about Japan's long-running fiscal dangers.
The Great Debate UK
Two days before Thursday's strong inflation figures, the People's Bank of China surprised with a rate hike. Global markets sold off, but quickly recovered. The effect of conducting monetary policy through short sharp shocks is waning. It looks time for a well-explained, concerted plan to fight rising prices.
from The Great Debate:
In 1987, UK Prime Minister Margaret Thatcher whipped up a firestorm of criticism from her opponents on the left when she told a magazine reporter that "there is no such thing as society", only individual men and women, and families.
“Those whom the gods would destroy, they first drive mad.” – the words of a wise Roman thinker (or was it a Greek central banker?). At any rate, the gods certainly seem to have no benevolent intentions with regard to this country, judging by the statements coming from the Bank of England, in particular the calls for another round of quantitative easing from one member of the Monetary Policy Committee and the cry of “Spend, spend, spend” from another.