I’ve just read an interesting, thoughtful and of course slightly self-serving speech by the Governor of the Bank of England, Sir Mervyn King, for whom I have a great deal of respect. Titled “Twenty Years of Inflation Targeting” it reflects … Continued
Centrally planned economies work very badly for two reasons. First, even if you had accurate data on what customers wanted and all the technical relationships between inputs and outputs, you would have a computational problem far beyond any practical solution. … Continued
Last year a group of MFin students did a consulting project for a specialist energy investment firm, comparing the investment prospects for solar and wind power in China and India. They were very negative about the outlook for China, on … Continued
Most Cambridge students live and study in an area of about one square mile of Cambridge. This includes the city centre and most faculties, though if you need to go to the West Cambridge site or the Biomedical campus (see … Continued
Yesterday in class a question arose as to whether the Federal Reserve (the US central bank) is keeping US government interest rates down by buying government bonds in the market. By adding to the demand for bonds, relative to a … Continued
Quantitative easing (QE) has become a highly controversial policy, particularly in the USA, where the Federal Reserve has been criticised by politicians, investors and academics up to and including the charge of treason. Yet the Chairman of the Fed, Ben … Continued
One of my recent dinners was at the house of the Vice Chancellor of the University of Cambridge, at his grand, official residence in Latham Road. The dinner was for speakers at the Cambridge University alumni weekend, which attracts several thousand … Continued
Every country’s economic relations with the rest of the world are summarised in the balance of payments. This is divided into the current account, which records the flows of trade and income, and the capital account, which records the flows … Continued
Perhaps it’s having recently re-watched the film Brideshead Revisited, which rather emphasises the food and drink aspect of student life at Oxford. Perhaps it’s the fact that I have seven official work-related dinners (and three drinks receptions) coming up in … Continued
Financial repression is a term used by economists which means the government taking ordinary people’s savings to achieve some goal, typically to pay for the government itself, by exploiting imperfections in the financial system. It is an indirect form of … Continued
I last visited South Africa in 1987, during the apartheid period. Since at that time there was a cultural and economic boycott of the country, I should explain to alarmed friends that I was there because I was working for … Continued
Starting pay for new investment banking hires at the analyst (entry) level has gone up recently. This report shows that the investment banking employment cartel is now paying £45,000 for people starting this autumn in London. That looks like good news … Continued
Early September is a pleasantly quiet time of the year in Cambridge, between the tourists and the new year of students. These pictures were all taken within five minutes walk of Cambridge Judge Business School on a short lunchtime stroll. … Continued
I was recently asked the difference between a Ponzi scheme and a pyramid scheme. They are closely related but there is a key difference, which is that a pyramid scheme is not necessarily fraudulent, though it frequently is marketed with … Continued
The International Monetary Fund (IMF) is the one organisation that has come out of the financial crisis of 2007-09 in better shape than it went in. Set up to police the system of fixed exchange rates that was the basis … Continued