The President is an agent of international communism. Elites are surrendering American sovereignty to the United Nations. Foreign troops are massing in Mexico, and the Georgia swamps, prior to a takeover of the US.
Those rumours sound contemporary but they are not. They were circulating in the late 1950s, when Dwight Eisenhower, a military hero (and Republican) was the President, and persisted well into the 1960s when American democracy suffered one of its greatest trials. The 1960s were marked by three terrible assassinations (the two Kennedys and Martin Luther King), riots in major cities and huge political division.
A look back to the 1950s and 1960s can tell us quite a lot about the parlous state of American democracy today. The era demonstrated that it was perfectly possible to spread conspiracy theories, and foment social division, in a pre-internet age. It showed that democracy falters if one group believes rule by the other side to be “illegitimate”. And it revealed the problems that occur when a majority is asked (against its will) to cede ground to a persecuted minority. …
Some call it the “culture war”. Others refer to identity politics. But the language we use and even, in a specific instance, the clothes we wear, identify which “tribe” people belong to. Use the wrong term and you risk being drummed out of the tribe or condemned for being in the wrong group.
It all brings to mind the story in Judges, chapter 12 where the people of Gilead used the word “shibboleth” to identify their enemies, who could not pronounce it. …
It seemed to take forever but it has finally been confirmed that Donald Trump has lost the Presidency and Joe Biden has been elected. The result was rather closer than pollsters expected and took far longer than seems sensible for the world’s most powerful nation.
But it is worth reflecting on the result. In 2016, Trump’s initial election and the Brexit referendum vote were portrayed as a crushing rejection of the “liberal elites” by forgotten communities in the two countries. …
CONSIDER THE attributes of the ideal modern manager. Such a boss would consider a wide range of factors before making a decision. He or she would earn the loyalty of their staff by treating them fairly, and listening to their views. Good managers do not seek to take all the credit when things go right, and nor do they assign blame to others when things go wrong. The best bosses also choose their words carefully when speaking or commenting in public.
President Donald Trump earned his fame as a businessman, and as a host of a reality TV show about management. So it is all the more remarkable that he displays none of the characteristics of the ideal modern manager. …
Steve Bannon, the former political adviser to Donald Trump, regularly portrayed himself as a crusader against an “out-of-touch, cosmopolitan, liberal elite”. So it was a nice irony that, when he was recently arrested on charges (which he denies) relating to the “We Fund the Wall” campaign group, he was onboard a Chinese billionaire’s yacht at the time.
It is pretty presumptuous for anyone to claim to speak for “the people”. The people think quite divergent things. Donald Trump’s election in 2016 caused a lot of commentators to proclaim that “the people” had rebelled against political correctness or neoliberalism or some other factor. But 65.9m people voted for Hillary Clinton; only 63m for Trump. It was only the distribution of votes in the electoral college that put Trump in office. …
Thirty years ago, these financial truths would have been seen as self-evident. First, profligate governments pay a price in terms of higher borrowing costs. Second, the magic combination of economic policy would be to keep both inflation and unemployment low; that would keep the voters happy.
But here we are in 2020 and the British government has just borrowed £62bn in the last month, more than it did in the previous financial year. It is on target for a budget deficit of 15% of GDP in the current financial year. …
The Greek tourism minister appeared on the BBC’s Today programme, saying that he hoped Britons would visit his country this summer. But at the same time he suggested that social distancing rules would need to be observed, for example by separating beach chairs.
But it doesn’t take much thought to see how difficult this will be to organise. When people go on holiday, they tend to eat in restaurants, and drink in bars. The only way of enforcing social distancing rules will be to reduce the number of customers in each venue. But how will everybody be fed? …
The coronavirus pandemic has overwhelmed the recent global health debate. But worrying developments were occurring in America even before the virus appeared. And those developments are brilliantly outlined in the recent book by Anne Case and Angus Deaton: Deaths of Despair and the Future of Capitalism. This book is a genuine must-read when you are whiling away those long hours of quarantine. It is also relevant to the discussion of whether the economic shutdown will cause more deaths than the virus.
The book builds on previous work by the two economists which focused on the sudden rise in mortality among middle-aged white Americans. Indeed, the trend is so substantial that American life expectancy as a whole declined for three successive years after 2014. Having peaked at 78.9 years in 2014, life expectancy fell to 78.6 in 2017 before improving slightly to 78.7 in 2018. Those figures are well below life expectancy in Italy, Spain or Australia, at around 84 years, or the UK at 81.8. …
Live long enough and you will experience a number of bear markets. This author can remember the gloom of 1973–74 (when the UK market had a dividend yield of 12%) and 1987’s Black Monday, when the Dow fell 23% in one session. But it is not these sudden crashes you need to worry about. It is the long slow declines that devastate your portfolio; Japan’s Nikkei 225 index is still only half its end-1989 level. Many rallies over the last 30 years have petered out.
For American investors, the alarming falls in the last few weeks only offset what was a very good year in 2019. If you had ignored the financial news for the last year and glanced at your portfolio for the first time today, you would find the S&P 500 was 0.1% higher than it was 12 months ago. Disappointing, you might reflect, but nothing to panic about. Tech stocks, as represented by the Nasdaq index, are up 7.3% over the same period. Looked at over a longer period, the S&P 500 is more than four times the March 2009 low of 666. …
Will Covid-19 (the coronavirus) become a worldwide pandemic, killing tens of thousands and inducing recession? Or will it become just a seasonal hazard like most influenza outbreaks?
The best answer to those questions at the moment is: we don’t know. Disease outbreaks disrupt both demand and supply; consumers stay at home and factories fail to produce finished goods and components. In both cases, the effect is likely to be temporary. Consumption and production will resume once fears subside.
Experience suggests the world will “muddle through” as it did after the SARS outbreak of 2002–03. The IMF has lowered its global growth forecast for this year, but only by 0.1 of a percentage point, which is a rounding error. Given this reasoning, the financial markets took a pretty relaxed view of the crisis until February 21st. But then there was a burst of cases in Italy and South Korea. The week of February 24th has seen a much stronger sell-off in equities while the yield on the ten-year Treasury bond has dropped to a historic low of 1.3%. In other words, investors are willing to accept a very low return in order to keep their money safe; a sign of risk aversion. …
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