This Week in Geopolitics, November 2017

Why the Next US Recession Could Be Worse Than the Last

November 20, 2017

Before we begin, I’d like to offer a hearty thanks to the thousands of you who responded to the survey we issued last week. If you haven’t responded yet, don’t worry – there’s still time. The goal of the survey is to figure out what you, the readers, want to read. At the end of the month, we’ll produce a video series addressing the top three topics you have chosen. You can access the survey and let us know what’s on your mind by clicking here. Thank you in advance for your time and your...

In China, More Regulation Does Not Mean More Enforcement

November 13, 2017

Last week, Chinese central bank governor Zhou Xiaochuan penned a letter, published on the bank’s website, discussing problems in China’s financial sector. His letter focused on the private sector, where poor regulatory oversight has encouraged the creation of bubbles in areas such as online lending and real estate. It also discussed the uncertainty over where local government authority ends and central authority begins, citing this as a reason for the difficulty of managing the financial...

Turkey: A Case Study in the Borrower’s Dilemma

November 6, 2017

The motivations that underlie a country’s decision to borrow money are not always strictly economic. Take Turkey, whose ratio of gross external debt (all public and private sector debt) to GDP has increased from 39% in 2012 to 52% today. Turkish President Recep Tayyip Erdogan has been pushing to increase investment by increasing available credit to spur economic activity. This is a political goal, though one motivated by economic objectives. The problem Erdogan encountered, however, is that...