Daily Archive: Tuesday, January 25, 2011

India hikes interest rates to contain inflation

The higher rates won’t cure their inflation problem, and instead fuel nominal growth and add to the problem. What does generally happen, however, is inflation helps the automatic fiscal stabilizers work to bring down the govt deficit, which is hailed as a good thing, as it unknowingly undermines aggregate demand and causes ...Read More

State of the Union

Some of the risks listed at year end seem to be coming on line, including slower growth out of China, euro austerity keeping a lid on demand in the euro zone, and US fiscal balance too tight for anything more than very modest top line growth, given current credit conditions and the ...Read More