Tag: Finance&Economics

RARELY has a Chinese city boss had more fans than Li Dakang, the earnest, driven Communist Party chief of Jingzhou. “I want development, I want speed and I want GDP,” he recently intoned. “But I want it to be modern GDP, GDP that comes without pollution.” Over the past month tens of millions have tuned in to watch him strive to fulfil these promises. On their smartphones, they share images of the heavy-eyed man with an easy smile, quoting his words and cheering him on. His policies have even been immortalised in a musical tribute, “The GDP Song”.

Li Dakang is not real, nor is Jingzhou. They exist only on “In the Name of the People”, a wildly popular 55-part television series about China’s battle against graft. Since its first broadcast in March, the show has attracted attention for its depiction of official corruption, unusual in the context of Chinese censorship. Less noted is the insight it has offered into a range of China’s economic problems—not just…Continue reading

Five Bowies make a Winston

TUCKED away in a corner of Brixton, in south London, a rainbow-coloured ATM dispenses cash, looking for all the world like any other. But the notes it spews out are not pounds sterling. They are Brixton pounds (B£). Not to be mistaken for silly Monopoly money, the Brixton pound can actually be spent, legally: the currency, which has a fixed one-for-one exchange rate with sterling, is accepted at over 150 local shops and businesses. It can even be used to pay local taxes.

Launched in 2009, this is one of many such initiatives. Local currencies have been adopted in other towns and cities in Britain, such as Bristol, Exeter and Totnes. Elsewhere, examples include the eusko, used in the French Basques; BerkShares, used in western Massachusetts; and the Ithaca Hour, in Ithaca, New York. Barcelona plans an experiment in 2017.

Such schemes aim to boost spending at local retailers and suppliers, by encouraging the recirculation of money within a community. Because the currency is worthless outside its defined geographic area, holders spend it in the neighbourhood, thus creating a “local…Continue reading

FOR MUCH of 2016, things seemed to be going well in emerging markets. A pickup in commodity prices signalled that the global economy (and China’s, in particular) was more robust than feared as the year began. In the manufacturing sector, the average level of the purchasing managers’ index in developing countries ticked up from 49 at the start of the year (indicating contraction) to 51 (expansion) by October, according to Goldman Sachs.

Signs of stability could be identified even in the economies that most worried investors in recent years—the so-called “fragile five” of Brazil, India, Indonesia, South Africa and Turkey. All had seen their current-account deficits shrink in the past three years, making them less dependent on foreign inflows of capital.

Confidence in emerging markets had also revived among international investors. Before the American presidential election both the MSCI emerging-stockmarket index and JP Morgan’s emerging-market bond index had outperformed their developed-world equivalents this year.

But Donald Trump’s victory seems, at least temporarily, to have changed minds. On November 11th emerging-market currencies suffered…Continue reading