US Economy

For the American central bank, playing politics to preserve its independence is a terrible strategy. The US Congress built the Fed precisely for moments of political pressure. To cave now would harm the Fed’s own case for independence.

The US President’s call last week for a Fed rate cut and his tirade against trade deficits made the world sit up alright, but aghast at his latest ‘or else.’ An economy cannot be run by all-caps command—or as a business for that matter.

Technology may have made geography history, but not the value of talent pools. Places like New York City, Los Angeles and Silicon Valley draw the world’s most talented folks, spurring innovation that spills over to the entire US economy.

What the US Fed’s new chief had to say at the symposium reassured global markets, while the seven key principles he enunciated for monetary policy are relevant for central banks across the globe—even if his position on communication is contestable.

Lower-middle-class households in India may effectively be caught in a ‘gated recession.’ Trying to halt AI job takeovers would do more harm than good but governments could levy higher marginal taxes on the fortunes, inheritances and incomes of the ultra-rich.

The common view is that an upshoot in yields is bad news. However, of the various factors driving these up, investment in artificial intelligence (AI) is a big driver in the US. This isn’t so in other economies lumped with wide fiscal deficits and enlarged debt burdens.