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Aug 15, 2011
via Breakingviews

Return to gold standard seems less unthinkable

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

Fiat money has worked well since Richard Nixon ended the dollar’s peg to gold 40 years ago to the day, but this latest recession must gnaw at believers. If years of ultra-cheap cash give rise to serious inflation or an accelerated retreat of the U.S. currency, the gold standard, however erratic and deflationary, may start to appeal again.

Aug 1, 2011

Weak U.S. growth could swamp $1 trln deal on cuts

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

By Martin Hutchinson

NEW YORK (Reuters Breakingviews) – Weak economic growth could swamp the first $917 billion of cuts included in the political deal struck to raise the U.S. debt ceiling. Friday’s anemic GDP report casts doubt on the pact’s deficit reduction figures. On a simple analysis, if economic growth in 2011-16 falls short of the Congressional Budget Office’s 3.25 percent estimate by 0.5 percentage point, the expected initial cuts disappear completely.

Jul 26, 2011
via Breakingviews

U.S. debt capers may expose “risk-free” fallacy

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

Alan Greenspan admitted the financial crisis pulled the rug out from under 40 years of market ideology to expose a “flaw” in his thinking. Uncle Sam’s tottering AAA credit rating may do the same to investors the world over.

Jul 21, 2011
via Breakingviews

U.S. downgrade would force bond buyers to rethink

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

Standard & Poor’s could cut America’s AAA rating even if Congress does a deal on the debt ceiling. That would force a rethink. The 18 other top-rated sovereigns are either caught up in the EU mess or tiny. Without the “risk-free” benchmark of U.S. Treasuries, even ultra-cautious bond investors would have to get used to credit risk.

Jun 22, 2011
via Breakingviews

Texas economy not proxy for whole of America’s

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

Texas isn’t a proxy for the broader U.S. economy. Rick Perry, the Lone Star State’s governor, may run for president in 2012. And Texas boasts below-average unemployment and decent growth. But it also has no state income tax, a large energy sector and not too much housing trouble. Washington’s bigger problems may not yield to Texan solutions.

Jun 10, 2011
via Breakingviews

Hillary Clinton wouldn’t suit the World Bank

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

Hillary Clinton, the U.S. secretary of state, may want the top job at the World Bank in 2012, though officially she doesn’t. That’s probably a bad idea. But even if it’s just an early trial balloon, it reveals the jockeying surrounding the big vacancy at the International Monetary Fund.

May 27, 2011
via Breakingviews

Multinationals propping up U.S. economic growth

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

U.S. multinationals are propping up the nation’s economic growth. While annualized first quarter GDP growth was a sluggish 1.8 percent, much of it inventory buildup, the private sector expanded more strongly, as did returns from overseas investments. With the government now reining in outlays, America’s biggest companies are providing the economic stimulus.

May 24, 2011
via Breakingviews

Only China can tackle its own dodgy accounting

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

WASHINGTON — Serious reporting shenanigans have hammered several U.S.-listed Chinese companies — most recently Longtop Financial Technologies. However, American investors and regulators have little redress across the Pacific. They should practice healthy skepticism until China opens and polices its own markets.

May 18, 2011
via Breakingviews

IMF should use crisis to toughen itself up

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

WASHINGTON — The International Monetary Fund has a chance to toughen itself up. Under Dominique Strauss-Kahn, the managing director currently imprisoned in New York after being accused of sexual assault, the IMF’s lending has multiplied, largely to basket cases like Greece. But recent loans have failed to force change while damaging other lenders’ standing.

May 12, 2011
via Newsmaker

Global commodity craze should be good for Africa

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

In theory, high commodity prices should be a bonanza for Africa’s many emerging economies. Soaring prices for the continent’s major exports bring higher revenues to cash-strapped states. The trouble is, for economic development to take place these funds need to be usefully converted into private sector activity. Africa’s endemic corruption, poor infrastructure and bad policies make that a tall order.

    • About Martin

      "Martin Hutchinson is a Reuters Breakingviews columnist and writes about emerging markets, particularly in Latin America, and monetary and macroeconomic issues. He is a former merchant/investment banker with 27 years of experience."
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