Read more about the article Secular Stagnation and the Big Balance Sheet Economy

Secular Stagnation and the Big Balance Sheet Economy

Private balance sheets have risen relative to GDP in advanced economies in the last decades, in tandem with a trend of decline in long-term real interest rates. Asset-driven macroeconomic cycles, along with a structural trend of rising influence of finance on income growth and distribution, have become part of the landscape. Underlying secular trends of stagnation may also be suggested, making the macroeconomic dynamics dependent on the balance sheet economy getting bigger and bigger.

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Read more about the article Why a Weaker Dollar Might Be Good for Emerging Markets?

Why a Weaker Dollar Might Be Good for Emerging Markets?

There is currently a convergence of views that, gradually or not, US current account deficits and insufficient domestic savings tend to slide down the relative value of the dollar. Four “channels of dollar transmission” explain why there is a negative correlation between the dollar's strength and economic growth of emerging market economies. A dollar depreciation against a wide basket of currencies in 2021 would likely be welcome by emerging economies.

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Read more about the article The two sides of capital flows to Brazil

The two sides of capital flows to Brazil

There was a significant inflow of funds in Brazil's external financial account in October and November for investments in both stocks and fixed income instruments. The bulk of the recent inflow has come in a “passive” way, and it did not include considerable volume on the side of “active” investors. For the wave to unfold in the availability of external resources to finance investments in the country, progress and confidence in the domestic fiscal and regulatory agenda will be relevant.

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Read more about the article Public financing of green innovation: Matchmaking of offers and demand for financing + Economic and Political Impacts of COVID-19 on BRICS Countries

Public financing of green innovation: Matchmaking of offers and demand for financing + Economic and Political Impacts of COVID-19 on BRICS Countries

Public financing of green innovation: Matchmaking of offers and demand for financing - Relevant recent literature states that direct and pervasive public financing has been instrumental in the development of innovative technological trajectories. The reasoning builds on: (i) the presence of finance from public sources across the entire innovation chain; (ii) the concept of ‘mission-oriented’ policies that have created new technological and industrial landscapes; and (iii) the entrepreneurial and lead investor role of public actors, willing and able to take on extreme risks, independent of the business cycle. On the other hand, public financing depends largely on the availability of funds. The available capital (human or otherwise) for different jurisdictions is different, which may motivate a case for heterogeneity of policies regarding innovation funding. ------------------- Economic and Political Impacts of COVID-19 on BRICS Countries The event, organized by GEBRICS/USP and the Department of International and Comparative Law (DIN) of the Faculty of Law, University of São Paulo, aims to bring together professors, researches, specialists and diplomatic representatives from all BRICS countries

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Read more about the article Africa’s Infrastructure Finance

Africa’s Infrastructure Finance

Africa’s infrastructure investment gap has widened over time. Addressing the mismatch between developed countries’ “global savings glut” and African countries’ “investment dearth” might be a win-win. To facilitate that matching, some risk mitigation tools can be used. In this brief, we propose that by providing such risk mitigation tools, development institutions and governments can crowd-in private investment rather than crowd them out by providing full financing.

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Read more about the article Dependency and disconnect of U.S. financial markets

Dependency and disconnect of U.S. financial markets

U.S. stock and corporate bond markets performed extraordinarily well from the March financial shock caused by covid-19 to the end of last month. Then, three consecutive weeks of decline in the three major stock market indexes have been followed this week by a global slump attributed to fears of new lockdowns. A period of disconnect of financial markets with the underlying real economy has culminated in a revelation of the former’s high dependency to Federal Reserve policies.

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Read more about the article Benefits and Costs of Islamic Finance

Benefits and Costs of Islamic Finance

A certain parallel can be made with ESG investments with a performance below non-ESG portfolios that is more than compensated, from the standpoint of investors’ preferences, by ensuring adherence to certain principles as a value in itself. Sharia compliance may well be deemed as a benefit greater than any economic opportunity cost for those who favor its use.

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Read more about the article Threat of ‘currency bullying’

Threat of ‘currency bullying’

The possibility of mutually damaging financial volatility in the US and China may limit the extent of 'currency bullying' being used as a proxy in the countries' trade war. Nonetheless, rhetoric from Washington is likely to remain clamorous as the US trade and current account deficits rise and global imbalances worsen.

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Read more about the article ECON+ The changing face of international finance by Otaviano Canuto

ECON+ The changing face of international finance by Otaviano Canuto

  https://www.mixcloud.com/EconPlus/econ-interview-with-otaviano-canuto-trends-in-financial-globalisation/   In our latest podcast with Otaviano Canuto, ECON+ discusses the changing face of international finance. Looking at the more detailed picture, we see that trends may not…

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