Kenya, Uganda, Tanzania, Rwanda and Burundi are targeting 2012 for adopting a common currency. What they gain is a more stable currency arising out of a larger trade bloc, with better liquidity in currency transactions (and thus lower cost for transactions). They might even had a slightly improved allocation of capital across the countries now…
Brad De Long has a look at the risk-increasing implications of an inflation target that is too low. It’s interesting to me how the US is still so focussed on concerns about inflation being too high or USD depreciation when the real risks are unemployment and, yes still, deflation.
A brief follow up to my previous post on inflation, commodities and the Chicago Fed’s research on this link. The aim of their work was not to model the Fed Fund Rate, but they did build a model to assess this as part of their research. (They needed to confirm whether the non-response of core…
Commodity prices rise and the world screams hyperinflation. Elsewhere, alternative investment managers espouse the virtues of commodities as an asset class that generates “alpha” returns (i.e. returns not related to the overall direction of markets). The thing is, it’s hard to have it both ways. Â The link between unexpected/expected inflation and equity prices in the…
