To say that it has been hard to read the real intentions of President Elect Donald Trump since the election would be an understatement. Which is it to be: Trump Lite or Donald Dark? Below is an impression of how the Fathom view has evolved as the 'facts' (in our 'post-fact' world) have emerged. Fiscal stimulus is going to happen, the stock markets are up, the US dollar is stronger and US monetary policy is on the road to normalisation.
It is nigh on 200 years since David Ricardo first set out his theory of comparative advantage in his classic work 'On the principles of political economy and taxation'. Since that time it has been a unifying belief among economists that a country should channel its resources into producing only those goods and services in which it has a comparative advantage, exporting whatever it does not need around the world. But what are different countries good at? Revealed comparative advantage
In September 2015, Jeremy Corbyn, a 500:1 outsider, won the leadership of the British Labour Party, Her Majesty’s Official Opposition. In May 2016, Leicester City FC won the English Premier League having been given odds of 5000:1 against at the start of the season. In June, the British referendum delivered a vote to leave the European Union, when the odds were 7:1 against at their longest. In October, the Colombian referendum on the proposed peace deal there delivered a ‘No’,
From his infamous “whatever it takes” speech back in July 2012 to being ‘attacked’ by a protester and doused in confetti back in April 2015, Mario Draghi’s tenure at the helm of the European Central Bank has been eventful to say the least. While his term does not expire until 2019, this week marked his fifth anniversary. Other policymakers aim to give nothing away in the run up to press conferences, but in the case of Mario Draghi, something entirely
As government ministers are fond of reminding us, the UK is set to be the fastest growing economy among the G7 in 2016. But there is another comparative statistic that is more damning. If we rank the G7 economies according to levels of non-housing investment as a share of GDP, the UK is bottom of the heap - a position it has occupied for the past 20 years. Those hoping for a government-led drive to raise the productive capacity of
Imagine a world in which Donald Trump is the President of the United States, and where he delivers much of what he has promised. The newly inaugurated President sets the ball rolling with a trade war, slapping import tariffs on Mexico and China. Foreign countries and US firms respond with lawsuits. Then a wall is built between Mexico and the US. Fearing the blocking of remittances, the neighbour to the south caves in and foots the bill. The US population
Unless you have been living under a Brexit rock for the past few weeks, you are doubtless aware of the mess in which Deutsche Bank finds itself. Between mid-2007 and late last year, the price of Deutsche Bank shares fell around 75%, as low interest rates, tougher regulation and reduced revenue hit profitability hard. The price has fallen a further 50% since then. As if to add fuel to the fire(sale), the US Department of Justice announced that the German
Every lawyer worth her salt knows there is a way of phrasing questions that creates a trap for the witness. Questions like: "Have you stopped fiddling your taxes?" are designed to preclude any non-incriminating answer. And questions like: "What was it that first attracted you to millionaire Paul Daniels?" are designed to undermine any answer that doesn't conform to the 'clue' that is in the question. It looks increasingly as though the survey that generates the official Chinese GDP data
How much is a safe worth? Viewers of the hit television show Narcos might have asked themselves that question when Pablo Escobar, a Colombian drug lord, dug up a pile of money buried in the ground years earlier, only to discover that it was rotten and no longer fit for use. Central Bankers might be asking themselves that question too. After all, safe sales have soared in Germany and Japan, where central banks have adopted negative interest rate policies. If
International trade is like bacon: you can never have too much of it. It is now almost 200 years since the British economist David Ricardo first wrote at length about the virtues of international trade. His Theory of Comparative Advantage explains why it is advantageous for a country to focus on making whatever goods or services it is best placed to make, and then to exchange those goods or services with other countries whose productive skills lie elsewhere. It has