Economy

The cryptocurrency winter has turned to spring: having slumped from $20,000 in late 2017 to $3,200 a year later, bitcoin has lately risen like a rocket to $8,800. Though it doesn’t change my negative opinion, I admit that if I had bought a fistful of these wacky gaming chips last October when I gave the crypto concept a kicking at our Spectator conference on the subject, I’d be up almost 40 percent. Evidently, hints from the US Federal Reserve and the European Central Bank that further bouts of ultra-low interest rates and quantitative easing may be in the offing have spurred what the FT calls ‘a rally in riskier assets’. Crypto is the new gold for those who distrust central banks and seek stores of wealth that governments can’t reach.

At 12:01 a.m. on Monday, President Donald Trump went a long way toward defusing a potential war – not with Iran, but Canada and Mexico, where Trump revoked tariffs he had imposed in the name of national security. Why the sudden bout of tariff reduction? The president is focusing on a one-front trade war with China. The restrictions began as two fronts of the same war. Trump imposed 25 percent tariffs on steel and 10 percent tariffs on aluminum imported from China last March. Then he extended those tariffs to the EU, Canada, and Mexico on June 1. But the president seems to have concluded that the US can no more fight a two-front war in trade than on the battlefield.

What delicious reading it makes going back over Paul Krugman’s missive in the New York Times on the morning after Donald Trump was elected in 2016. ‘Global recession with no end in sight...when are markets going to recover? A first pass answer is never...’ Those words should be carved into a façade somewhere in Wall Street and held up for ever after as an example of hubris of economic forecasters. In liberal circles nowadays there is always misery. The end of the world is always around the corner, where from economic calamity in the global capitalist system, climate change, rise of fascism, AI taking our jobs and creating mass unemployment, or whatever. But let’s get back to the real world for a moment.

Goldman Sachs isn’t just unpopular in the United States: their reputation black hole is expanding worldwide. In December 2018, Malaysia filed criminal charges against the investment giant over the 1MDB scandal, referred to as ‘the biggest financial scam in history’ — though Kuala Lumpur has indicated that it might be willing to drop the charges if Goldman pays $7.5 billion in reparations. After years of turning a blind eye to Goldman’s predatory behavior, hopefully 1MDB will push governments to take action against the firm memorably described as ‘a vampire squid’.

Has ‘Jay’ Powell gone wobbly, or does he know something we don’t? That was the question being asked after the US Federal Reserve, of which Powell is chairman, kept dollar interest rates on hold last week — rather than continuing to notch them upwards as it has been doing for two years — and hinted that the next move might actually be downwards. Trade tension with China, the impact of Donald Trump’s government shutdown and the risk of a no-deal Brexit were all cited as ‘cross-currents’ affecting the decision, but pundits led by Wall Street ‘bond king’ Jeffrey Gundlach declared the Fed to be ‘caving in’ to the demands of the stock market and the President.

We live in a time of hatred of elites, yet all these billionaires keep running for president. Howard Schultz, the ex-Starbucks CEO, has declared he is considering a run as an independent because he, like many others, is fed up with the current president and politics in general. Funnily enough, that is why the current billionaire president ran three years. That, plus ego. ‘This president is not qualified to be the president,’ says Schultz. That’s also what Michael Bloomberg (net worth: $44 billion) says, and the whispers that he is about to announce his candidacy are stronger than usual in this pre-election cycle. Bloomberg calls Trump a ‘pretend CEO’, and his would-be voters thrill at the thought that he is considerably richer than the Donald.

David Davis, the former Brexit minister, and Owen Paterson, another pro-Brexit ex-minister, confirmed Friday morning that they’re meeting with Trump administration officials to discuss a US-UK free trade agreement. Theresa May, the stricken British prime minister, refuses to discuss a US-UK FTA until after Britain has withdrawn from the EU in March 2019, and after Britain and the EU have made a new trade deal. This week, May forced a draft of her withdrawal bill through her cabinet, but sparked resignations from her cabinet and open revolt from pro-Brexit Conservatives. ‘We’re clearly here to advocate for a US-UK free trade agreement,’ said Shanker Singham of the Institute for Economic Affairs, who serves as an outside adviser to Boris Johnson.

Publicly-traded companies in California are now required to have a woman on their board of directors thanks to Gov. Jerry Brown, who signed a bill enacting the new mandate on in September. Although they intended to diversify corporate boardrooms, California legislators actually revealed that they believe adult women should be treated like helpless children. Ostensibly ‘feminist’ policies that give women an advantage based solely upon their gender will in fact undermine women’s equality. Women do not need hand-holding from the government to get ahead in their careers, and such legislation is counterproductive and patronising.

‘The Trump administration knows the planet is going to boil. It doesn’t care,’ claims Canadian eco-activist Bill McKibben in a Guardian editorial. With enemies as unhinged as this, who needs friends? McKibben is basing his claim on a few paragraphs buried within a 500-page ‘Draft Environmental Impact Statement’ issued by the National Highway Traffic Administration (NHTSA) and subsequently bigged up by the Washington Post as conclusive proof that Trump is the ultimate Gaia-raping super villain. According to the report, on current projections the global mean temperature is going to rise by around 4 degrees Celsius (7 degrees Fahrenheit) by the end of the century.

As Kamala Harris presents evidence that Brett Kavanaugh habitually exposed himself to several nurses upon being born and then to other females for months, nay, years afterwards, Donald Trump just secured a new trilateral trade deal between the United States, Canada, and Mexico. This, friends, is yuge, yuge! The deal replaces, or amends, the 24-year-old North American Free Trade Agreement between the three countries. From the moment he announced his candidacy, way back in 2015, until the day before yesterday, President Trump has assailed the original Nafta as ‘the worst deal ever.’ The fact that US trade with Mexico has gone from a modest surplus in the early years of Nafta to a $68 billion deficit now highlights his concern.

An acquaintance recently told me that I have become a ‘Red Tory.’ The description probably fits. Indeed, I rather like it. As I get older, when it comes to matters related to social justice I find myself reaching conclusions of the sort commonly heard from Senators Bernie Sanders of Vermont or Elizabeth Warren from Massachusetts. I’ve long since outgrown any social Darwinian inclinations that I might have entertained as a young man. Use public resources to help the downtrodden and distressed and to ensure equal opportunity for all? You bet: I’m as Left as they come. Similarly, on issues related to war and peace, I’ve become a thoroughgoing dove. My idea of ‘supporting the troops’ is to keep them out of harm’s way, except when genuinely vital interests are at stake.

If the Democrats want to surf a real blue wave in the midterm elections they will have to stop conceding the economy to President Trump. Look at a current snapshot and consider: job numbers are great, minority unemployment is at record lows, the stock market is happy. But beneath this cheery – temporary – façade, the same problems that caused the 2008 financial crash are still lurking. In fact, the contributing factors of the last recession have, in many respects, worsened. Ultra-high-risk financial behaviour, increasing deregulation and rosy political rhetoric telling us all to forget about the problems of the past: these are a few hallmarks of the current situation that also echo loudly with the lead-up to the 2008 collapse.

Over the summer, the Supreme Court ruled that public sector unions cannot require non-members to pay the fees that fund collective bargaining efforts, in American Federation of State, County and Municipal Employees v. Janus. While publicly defiant, the Los Angeles Times reported that AFSCME privately estimated that it could lose half of its members under the ruling. Public sector unions like AFSCME and the Service Employees International Union were among the last important labour organisations in the country and the Janus ruling left them reeling. In Harper’s, Garret Keizer writes that ‘American workers may soon be engaged in a virtual Armageddon with capital’.