Dirk Niepelt

In the FT, Sam Fleming and Demetri Sevastopulo report that the White House considers Marvin Goodfriend for the Federal Reserve’s Board of Governors. He has criticised the Fed’s crisis-era balance sheet expansion, saying the central bank should generally not purchase mortgage-backed securities, and has advocated the use of monetary policy rules to guide policy, as has Mr Quarles. … At the same time, however, Mr Goodfriend has been willing to contemplate the use of deeply negative rates to...

In an open letter, MIT President Rafael Reif writes (from the opening paragraph): Yesterday, the White House took the position that the Paris climate agreement – a landmark effort to combat global warming by reducing greenhouse gas emissions – was a bad deal for America. Other nations have made clear that the deal is not open to renegotiation. And unfortunately, there is no negotiating with the scientific facts. In March, Reif questioned planned federal spending cuts. And in January, he...

On the FT’s Alphaville blog, Matthew Klein reviews Swiss monetary policy over the last years and its effect on the real economy. He concludes that it seems the SNB’s relentless accumulation of foreign assets has been pointless — at best. More likely, the behaviour qualifies as predatory mercantilism at the expense of the rest of the world, especially Switzerland’s hard-hit neighbours.

On the FT’s Alphaville blog, Izabella Kaminska points to a paper by Italian academics arguing that the Ethereum technology tends to incubate Ponzi schemes. The uniqueness of the “smart Ponzi” is its capacity to protect the identity of the initiator but also its ability to persist even after being exposed. Since contracts are unmodifiable and thus unstoppable there is no central authority to terminate the execution of the scheme or force the initiator to refund victims. What’s more, the...

On the FT’s Alphaville blog, Izabella Kaminska questions the value of decentralization (and thus, blockchain technology) in intermediation. Decentralisation is, in almost all cases, not an efficiency. To the contrary, it’s a cost that adds complexity and creates an unnecessary burden for both users and operators unless centralised layers are added on top of it — defying the whole point. … At the end of the day, there are only two groups of people prepared to go to costly lengths to...

In the NZZ, Christian Speicher summarizes expected consequences of climate change for Switzerland by 2050–2060. Mean temperatures exceed the 1980–2009 average by 1.6–2.9 degrees Celsius. The temperature increase is more pronounced in Summer than in Winter. But ski resorts below 2000m are no longer competitive. Less precipitation in Summer, maybe more in Winter. More extreme weather events. Increased need for water storage and conservation.

In the FT, Paul McClean reports that according to FT estimates and as a consequence of Brexit, the UK will have to negotiate more than 700 treaties with third countries. More than 160 countries need to be dealt with; Switzerland, the US and Norway stand out. Some negotiations have to be concluded very soon: … the EU-US Open Skies accord for airlines, were agreed when the forces of liberalisation were at their peak. The political mood has hardened considerably since then. … The timing is...

Paul Krugman argues that the bilateral trade position is irrelevant. And he summarizes potential explanations: … one theory of imbalances is macroeconomic: countries that save more than they invest will run surpluses, countries that invest more than they save will run deficits. … But … [t]he bilateral imbalance is a lot bigger … The other story … is about “triangular trade.” Here’s my version: think of a world containing three countries, Spendthriftia, Austeria, and Petrostan. The first...

The Economist reports about new strategies to evade taxes. One is based on an occupational retirement scheme (ORS) in Hong Kong: A German or Australian with money to hide can set up a Hong Kong shell company, appoint himself as its director, with a local employment contract, and sign up with a trust company that provides an ORS. He can throw in cash, property or other assets, oversee the account himself, retire as soon or as far in the future as he likes, and then take out as much or as...

In the FT, Dan McCrum, Thomas Hale and Kate Allen compare bond syndications and auctions.