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INFLATION OF 2022: WHY CANADA’S CENTRAL BANK IS IN A FIX
By Pushpa Kumari
Feb 28, 2022
The present commentary discusses how past bad policy choices of Canada’s central bank have tied its hands to manage the inflation crisis of 2022. The price level has been disconnected from the realities of the economic conditions prevailing in the macroeconomy. Given the low-price level, the bank has been lowering its policy rate since the 1990s. And now it finds itself stuck in a low-rate trap that it can’t increase the rate even if current inflationary pressure demands so. If it increases its policy rate to manage the inflation crisis, it may create another crisis(es) in the process – asset crisis, debt crisis, and/or systemic crisis. What to choose, whether inflation crisis or other(s)? It appears to be in a fix.
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Why Macroeconomic Structural and Wage-Price Indicators are Puzzling the Policy-Makers
By Pushpa Kumari
July 30, 2019
This commentary tries to answer the puzzling questions – why there is disconnect between inflation and unemployment, unemployment rate and wage rate, monetary policy rate stance and real economy, economic buoyancy and price-wage indicators; and also, why neutral interest rate and natural unemployment rate are declining. it points to the non-representation of the structural realities by the economic data. As official measurements have been deviating …… Read More
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Inflation Targeting Needs Re-examination in the Developed Economies
By Pushpa Kumari
October 5, 2018
This commentary investigates how the targeted inflation rate has been achieved successfully amidst stagnant economic growth, declining domestic manufacturing, boiling asset economy, and piling financial vulnerabilities in the developed economies. It re-examines the modus operandi of the inflation targeting as an integral part of the management of the macroeconomy in these economies…… Read More
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Neither Strongman nor Strongman Politics is New, Only Avatar is Different
Economic-Political Power has Long Dominated the Society
By Pushpa Kumari
September 5, 2018
Where there is a massive discontentment in the general population, there is a way to popular politics. A strongman capitalizes those popular sentiments and takes charge as a warrior of the people. Is it a win of that strongman and his popular politics? Not so, it is in fact a defeat of the past political leaderships that has let built up the social discontent and gave a chance to a so-called strongman. Like it or not, current wave of strongman politics is slowly engulfing all-over the world….. Read More
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Globalization and Structural Shifts in the Developed World
From Industrialized to De-industrialization to Post-industrial Economies
By Pushpa Kumari
August 5, 2018
Globalization has affected not only the foreign trade but also the structure of the developed world. It has generated several shifts in the organization, functioning and outcomes in these economies. These structural shifts have since long been penetrating through, with varying degrees, their economy, society and politics via several domestic and foreign channels. It is significant to examine these shifts given their structural nature and long-term implications for national….. Read More
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Superpower War of the 21st Century – Declining America and Fading Capitalism Versus Rising China and Shining Communism!
Will US Trade War Conclude the Third World (Cold) War Started in the 20th Century?
By Pushpa Kumari
July 5, 2018
Historically, a transition from one superpower to another has involved a war. If history repeats itself, should the recent US trade war be assumed as a last phase of the superpower transition from the US to China? Last transition took place during the WWI from then superpower the UK to the USA. During war the US became the biggest wartime trade and finance supplier for the UK, and it was in 1916 when US output outpaced that of the entire British empire…. Read More
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Second-hand Clothes Trade Conflict Shows That Emperor Has No Clothes
By Pushpa Kumari
June 5, 2018
Trade conflicts are normal because nations may have their own national interests which at times are conflicting. But the trade conflict under discussion here is fairly abnormal. This is a trade conflict not between two normal trading partners, but America is at trade conflict with Rwanda. One nation having GDP 2224 times bigger (the US $19 trillion) than the other (Rwanda $8 billion). More important than the size of economy is the item of conflict– second hand clothes…. Read More