Over at Forbes, more on why the ECB won't do QE despite Spanish inflation having turned negative:
Spain is in a mess. Over a quarter of its adult workforce is unemployed, and according to CIB Natixis it has lost 25% of its production, even more than Greece. Spain’s inflation rate has been falling steadily and has now turned negative: the most recent retail sales figures show a fall of 0.2%. Various people anticipate ECB easing monetary policy because of the growing threat of deflation in Spain.
But this is to misunderstand the role of monetary policy in a currency union. The ECB sets monetary policy for the union as a single unit, not for its individual components. Deflation in Spain is a driver of ECB decisions only to the extent that it depresses Euro zone CPI. And I’m sorry if this sounds brutal, but Spanish unemployment is of no consequence, since the ECB does not have a mandate to target unemployment even at the Euro zone level, let alone in an individual country. The ECB can no more set policy to tackle deflation or unemployment in Spain than it can set policy to meet the desire of German savers for better returns. Its mandate is to maintain inflation close to 2% across the Euro zone economy AS A WHOLE.....
“Will you tell me how long you have loved him?” asks Jane
Bennet, on receiving the astonishing news that her sister Elizabeth is to marry
Darcy, the rich aristocrat she used to hate. “It has been coming on so gradually, that I hardly know when
it began,” replies Elizabeth. “But I believe I must date it from my first
seeing his beautiful grounds at Pemberley.”
This is from the end of Jane Austen’s Pride and Prejudice. Austen is lampooning the British 19th
century marriage market, in which women (and men) pretended to “fall in love”
when in fact they were marrying for money. But for cynics like me, such a remarkable
conversion has echoes in the 21st century. When someone suddenly becomes
an ardent supporter of an ideology they had previously - equally ardently - opposed,
always follow the money.
So, to Sir James Dyson, inventor of cyclone-technology
vacuum cleaners and ardent Brexiteer. Sir James is frequently heard
expounding his hardline Brexit views on the BBC, which is struggling t…
“What do they teach them at these schools?” wondered the Professor in C.S. Lewis's The Lion, the Witch and the Wardrobe.
The Professor, of course, was concerned about logic. But I wonder too - not about logic, but about maths. Especially among journalists writing about life expectancy and other long-term trends.
Here is the FT proclaiming "Average life expectancy falls". This is the headline for a chirpy piece about how reduced life expectancy could make things easier for pension funds facing big deficits.
There's only one problem with this. Life expectancy isn't falling. And the report the FT cites does not say that it is.
This is how the press release from the Institute and Faculty of Actuaries summarises the findings of their report:
Recent population data has highlighted that, since 2011, the rate at which mortality is improving has been slower than in previous yearsHowever, mortality is expected to continue to improve and there is significant uncertainty…
Last week saw two high-profile corporate failures in the UK. Toys R Us finally went into administration after a stay of execution over Christmas. And private equity firm Rutland Partners pulled the plug on geeky electronics retailer Maplin. Total job losses from both failures amount to something in the region of 5,000 across the whole of the UK.
No-one was particularly surprised by the failure of Toys R Us. The company had proved slow to respond to the rise of online shopping and the trend away from large out-of-town retail outlets in favour of small local shops. In the US, Toys R Us filed for Chapter 11 bankruptcy protection (the American equivalent of administration) in September 2017. Despite the American company's insistence that its European operations were not affected, it was almost inevitable that the UK subsidiary would eventually follow suit. British consumers are shifting to online shopping every bit as rapidly as consumers across the Pond, and the trend towards loca…