I used to think a rerun of 2008 would undoubtedly benefit the anti-capitalist left. Now I’m not so sureFive months ago this week, I invited some good-natured mockery by warning people that the only way to survive the looming economic crisis was to take a large notepad and go and watch The Revenant. We’d all be living in the wilderness soon enough, so it was time to learn how.Well I didn’t go quite that far, but I did state my profound belief that this crash would be much worse than the 2008 banking crisis, and – given how close we came to the collapse of the financial system then – it’s a reasonable fear that we won’t get so lucky twice.Related: George Osborne warns UK economy faces 'cocktail of threats'Related: George Osborne’s ‘cocktail of threats’ will leave us with a hangover | John McDonnell Continue reading...

Business leaders and policymakers at the World Economic Forum will focus on Chinese downturn, a commodities rout and stock market turmoilThe fragility of the global economy will take centre-stage this week with the International Monetary Fund poised to warn of growing economic risks as business leaders and policymakers gather for the annual World Economic Forum in Davos.The IMF will update its forecasts for global growth on Tuesday and is widely expected to paint a bleaker picture for the year ahead amid the deepening Chinese downturn, a commodities rout and turmoil on global stock markets.Related: Why the falling oil price may not lead to boomGlobal markets off $3.83 trillion, including U.S. $1.87 trillion (S&P 500 $1.41T) and non-U.S off $1.95 trillion18 months ago a barrel of #oil bought you a bottle of Pol Roger 2004 champagne. Today it gets you Tesco Finest. pic.twitter.com/ROxaaTmW3HWe no longer expect #BankofEngland rate hike in May but we believe MPC may well act in Aug. Interest rates likely to end 2016 at just 0.75% Continue reading...

Iranian president hails end of sanctions as western economies and companies such as Airbus stand to benefitGlobal oil prices will remain under pressure this week after Iran said it was ready to add half a million barrels a day to crude exports just hours after international sanctions were lifted this weekend.Iran’s president, Hassan Rouhani, hailed a “glorious victory” as his country relished reconnecting to the global economy following the formal announcement late on Saturday that sanctions were ending thanks to moves by Tehran to scale back its nuclear programme.

An economic boom usually follows a big drop in the oil price but this time maybe different – indicative not of oversupply but weakness in demandThere was a time when Blue Monday meant a song by New Order. These days it is the third Monday in January, allegedly the most depressing day of the year.Whether there is any scientific basis for this claim is debatable, but for what it’s worth the argument is that people feel miserable because Christmas is over, the credit card bills are arriving, it’s dark when you go to work in the morning and it’s dark when you head home.Related: Janet Yellen and Fed left with face full of egg after interest rate rise blunder Continue reading...

Standard Chartered last week warned of oil at $10 a barrel. What impact would that have on North Sea oil, the consumer and the UK economy?Up to 65,000 jobs have already been lost from the British offshore oil industry since the cost of crude fell from a peak of $115 per barrel in June 2014 to its latest level of $30. A further decline to $10 would clearly turn a cull into a massacre, not least because the North Sea is a high-cost place to operate, with the break-even price for many fields around $60.Related: Saudi Aramco – the $10tn mystery at the heart of the Gulf stateRelated: Spend, spend, spend – it’s what the chancellor is praying for Continue reading...

Personal debt and the booming property market have become the main drivers of growth in Osborne’s economyGeorge Osborne has already put in place legislation to prevent future governments racking up more debt, but consumer borrowing? Well, that’s another matter. Consumers who spend all their wages and then a bit more on top are George Osborne’s best friend.Figures last week from the Finance & Leasing Association (FLA) documents a 17% surge in new consumer borrowing during the year to November 2015. The data covered credit cards, store cards, car loans and the dreaded second mortgage, which was so popular that the value of new loans jumped 31% during the year. Continue reading...

Since the last crisis, countless opportunities have been missed to clean up banking and address structural problems in the world economyWhen the big names from business, government and central banking meet over the champagne flutes in Davos this week, the official theme is “mastering the fourth industrial revolution”. The World Economic Forum has asked participants to chew over the rise of the robots and what it means for every aspect of human lives from jobs to the environment. No doubt their conversations will be fascinating.But while Davos delegates chat about hypotheticals between canapes, beyond the mountain resort some very real problems are playing out. Wild swings on stock markets, a plummeting oil price and patchy economic news frrom the world’s two biggest economies, China and the US, have raised the spectre of a fresh financial crisis. Continue reading...

Nicolás Maduro wants broad powers to tackle the deep recession crippling the oil-dependent country but he faces a tough battle from the oppositionVenezuelan president Nicolás Maduro has declared an economic emergency, seeking broad powers to address a crippling recession in the oil-dependent country after official figures showed that inflation has spiralled to 141%.The vaguely worded decree would grant Maduro extraordinary powers for two months to rule on economic matters but must be approved by the National Assembly, now under control of the opposition, where he gave his state of the nation address late Friday.Related: Venezuela frees Pepsi workers it arrested for not making enough Pepsi Continue reading...

Analysts predict the dollar may fall further before recovering towards the end of 2016 while stocks also suffered renewed sellingThe Australian dollar has dropped to its lowest level in almost seven years in overnight trading, falling to US68.62c.Related: How Australian households became the most indebted in the worldRelated: Gold is the bright spot in commodities rout but 2016 forecasts are divided Continue reading...

Losses followed worldwide declines due to concerns about health of the Chinese economy and falling oil price and extend US markets’ worst ever start to the yearUS stock markets suffered further heavy losses on Friday with the Standard & Poor’s 500, the index of America’s biggest companies, falling 2.2% to 1,880 points – the lowest since August 2014.The losses, which follow declines across the world due to concerns about the health of the Chinese economy and the plunging price of oil, extend the US markets’ worst-ever start to the year. The Dow Jones, which fell by more than 500 points at one point before ending the day down 391 points to 15,988, has fallen by 8.24% so far in 2016. Continue reading...

Fight for 15 advocates want to make sure that when the Democratic presidential candidates debate on Sunday America’s low wages are discussedFast-food workers are flocking to Charleston, in an attempt to make sure that when the Democratic presidential candidates debate on Sunday, they do not forget about America’s low wages.Related: After Sanders criticism, Donald Trump flip-flops: US wages 'are too low'Related: Economy is resilient but Americans still need a raise, says US labor secretary Continue reading...

Four weeks and one market meltdown later, US central bank’s decision to opt for early rate hike no longer looks so cleverTurn the clock back a month. It is the week before Christmas and the Federal Reserve has just raised interest rates for the first time in almost a decade.The mood in the markets is upbeat. A so-called Santa rally is in full swing. Dealers say the US central bank has played a blinder by keeping Wall Street sweet. If there were Oscars for central bankers, Janet Yellen would be picking up the golden statuette.Related: US stock markets take a major fall as Dow reaches lowest level since 2014 Continue reading...

Rise of 3% considered necessary due to problems recruiting and retaining senior judges in BritainHigh court judges are to receive an inflation-busting 3% pay increase next year – well above the government’s own public sector pay recommendations – taking their annual salary to £183,328.The rise, proposed by the Ministry of Justice to the senior salaries review body, is said to be necessary because there are problems with recruitment and retention of senior judges.Related: Top judge says justice system is now unaffordable to most Continue reading...

Output fell 0.5% in November, against expected rise of 0.5%, with ONS saying bad weather may have had impactBritain’s builders suffered an unexpected drop in output in November, signalling a faster slowdown in GDP growth during the final three months of 2015 than most City forecasts.Construction output fell 0.5% on a monthly basis in November, according to the Office for National Statistics, against expectations for a rise of 0.5% in a Reuters poll of economists.Related: UK housebuilding held up by lack of bricklayers, says report Continue reading...

The rapid rise of capital city house prices in the past two years has propelled Australia past Denmark with a ratio of 123.08% debt to GDP, analysis showsThe results are in: Australian households have more debt compared to the size of the country’s economy than any other in the world.Related: The latest job figures are promising – but can they last amid the economic gloom? | Greg Jericho Continue reading...

Berlin recorded its fastest growth since the early days of the eurozone debt crisis, while oil prices rose marginally after Wednesday’s dip to below $30 a barrelA solid performance by the German economy and hints of a delay to the next US interest rate rise calmed nerves in London and New York after a week of panicked stock market trading that has left many investors counting huge losses.The Dow Jones index of leading US corporations climbed 225 points on Thursday while the FTSE 100 reversed a 130 loss in early trading to finish 42 points lower at 5918. Continue reading...

Monetary policy committee votes to retain record low rate of 0.5% amid global uncertainty and brittle UK recoveryThe Bank of England has kept interest rates on hold this month, noting volatility in global markets and highlighting a sharp fall in oil prices that is likely to keep inflation low.Members of the Bank’s nine-member monetary policy committee (MPC) voted eight to one to leave rates at 0.5%, where they have been since March 2009, in a repeat of recent votes. Sticking to his recent stance, only Ian McCafferty voted for a rise to 0.75%.Related: The Guardian view on the economic and environmental impact of falling oil prices | EditorialRelated: UK trade deficit prompts alarm as exports fall Continue reading...

Global warming heads top economists’ concerns for first time but large-scale forced migration seen as most likely risk to materialiseA catastrophe caused by climate change is seen as the biggest potential threat to the global economy in 2016, according to a survey of 750 experts conducted by the World Economic Forum.The annual assessment of risks conducted by the WEF before its annual meeting in Davos on 20-23 January showed that global warming had catapulted its way to the top of the list of concerns. Continue reading...

S&P 500 suffers its worst day since September as new data showing American fuel stockpiles have hit record levels saw Brent crude fall to below $30 a barrelUS stocks fell heavily on Wednesday, with the Standard & Poor’s 500 falling 2.5% to take the index below 1,900 points for the first time since September, due to growing concerns about the falling oil price, which dipped below $30 a barrel for the first time in nearly 12 years.The S&P 500, which closed at 1,890 points, suffered its worst day since September and has fallen by 10% since its November peak taking it into “correction” territory, something that has not happened since August 2014.Related: China sees 'many challenges' in 2016 as trade slumps on weak external demandRelated: The perils of China's currency devaluation Continue reading...

Under Obama, the economic recovery has bypassed almost all Americans. They won’t stay silent for ever – and Bernie Sanders could be their inspirationTo critique Barack Obama’s presidency is to be guilty of these cardinal sins: blasphemy, ingratitude and a lack of realism. What was once the nation of Jim Crow produced the first African-American president, the most liberal commander-in-chief since Richard Nixon (as Obama himself once put it). Funny, charming, with a coolness that eludes practically every other politician, he is the ultimate ambassador for US power. Could the United States possibly elect someone more progressive?Related: Why does Bernie Sanders continue to avoid a foreign policy platform? | Lucia GravesRelated: Bernie Sanders: free public college tuition is the 'right thing to do' Continue reading...

Study by World Bank praises potential of technology to transform lives, but warns of risk of creating a ‘new underclass’ of the disconnectedThe rapid spread of the internet and mobile phones around the globe has failed to deliver the expected boost to jobs and growth, the World Bank has revealed in a report that highlights a growing digital divide between rich and poor.The Bank said no other technology has reached more people in so short a time as the internet, but warned that the development potential of technological change had yet to be reaped. Continue reading...

Some rue the get-rich-quick allure of oil in emerging nations. Whatever happens, the geopolitical consequences of falling prices are myriad and unpredictableIn the geopolitics of oil production, predictions are always risky. However important it may be, the price of crude is never the single factor driving events. That a global shakeup will occur if the spectacular tumble in prices persists is, however, a fairly safe bet. Witness how record highs and lows in oil have affected international relations and political developments over the last four decades.The oil shocks of the 1970s reshaped the global landscape and lent new significance to the Middle East. When prices collapsed in the mid-1980s, the Soviet Union’s final demise owed much to the collapse in its export revenues. Saddam Hussein’s 1990 invasion of Kuwait derived in part from an ambition to capture new lands at a time of financial stringency. In Algeria, another country dependent on oil revenues, that same price collapse – which reduced the price of crude to below $10 a barrel – contributed to an election victory for Islamists, then a coup, and then civil war. All of this makes it difficult to draw clearcut conclusions about strategic winners and losers. Of course, the liberal democracies of the west benefited from the end of the Soviet bloc, but it is hard to argue that low oil prices in the Arab and Muslim world led to much peace and stability.Related: The Guardian view on the economic and environmental impact of falling oil prices | Editorial Continue reading...

Other attendees will include John Kerry, Justin Trudeau, Will.i.am and Loretta Lynch, as well as the archbishop of Canterbury and representatives from UberA cast of politicians, digital pioneers, activists and Hollywood glitterati will gather in the Swiss ski resort of Davos next week for the annual World Economic Forum, which will take place against mounting fears of a new global crash.While the official theme of the five-day annual event is “the fourth industrial revolution” – a topic that will focus on the looming impact of robots and artificial intelligence – the real talking point for the 2,500 participants will be whether the violent gyrations in global financial markets since the turn of the year are evidence of trouble to come. Continue reading...

Reconnecting Tehran to the global economy set to have huge ramifications for the global economy, especially the oil marketThe European Union and US are expected to formally lift sanctions against Iran this weekend, dismantling an intricate network of punitive measures built up over nearly a decade and reconnecting Tehran to the global economy.

All the day’s financial news, as China defies pessimism by reporting a surprise rise in exports in December

Royal Bank of Scotland economists say the global economy is in for a very gloomy year indeed. Here’s what five economists thinkRoyal Bank of Scotland has warned of a “cataclysmic year” for the global economy, triggered by a slowdown in China, as it urged investors to liquidate all assets apart from high-quality bonds. The Guardian asked several economists whether they agreed with the bank’s gloomy outlook.Related: Sell everything ahead of stock market crash, say RBS economistsThe message from RBS is one of panic, which I don’t think is justified by current events. I’m worried about the outlook for the global economy, but not yet panicked.Sure, the economic indicators point to things being not so good. For instance, a sharp slowdown in China is not good for the UK, the US or Europe, because it puts a drag on growth. In that sense the impact is significant. However, it is not a disaster.We do not dispute that China will have a hard landing. It is something we have been warning about since 2009 and certain about since 2012. It is heading for 2% GDP growth and possibly lower, not the published 7%.But most people, including RBS, are overestimating the impact of China on the rest of the world. It will have a negligible effect in terms of growth in the developed world. In terms of inflation, it will have profound consequences through lower commodity and oil prices. It will also harm UK and western manufactured exports as China’s goods become cheaper and ultimately force workers in industries that compete with China to accept lower wages.The start of the year has been characterised by growing fears about the global economy and an associated rise in risk aversion, despite very little in fact changing in terms of the hard economic data.All of the current concerns, from worries about China’s debt to higher US interest rates, the winding down of central bank largesse and collapsing commodity prices, have been nagging away over much of the past year. However, it seems that optimism that the global economy can weather these headwinds is finally giving way.If you look hard enough you can always find somebody telling you markets are about to crash, but they are normally wrong. Historically equities have been the best asset class over the long term – listening to the doom-mongers has been a mistake.Today’s disappointing industrial production figures suggest the [UK] economy slowed toward the end of 2015, and is still heavily reliant on consumer spending. However, growth is steady (if unspectacular), the labour market continues to show encouraging signs and interest rates look unlikely to rise any time soon.This is a scary warning from RBS but it doesn’t seem sensible to spook investors. As Keynes made clear consumer and business confidence matters – he called them animal spirits. Volatility is high but a great collapse doesn’t seem to be in the air. It doesn’t make sense to talk down markets as that can become self- fulfilling.The year started badly in stock markets around the world as China looked to be in free fall. Things look a little better now. The worry for the UK is that the government failed to fix the roof when the sun was shining over the last five years or so. Even the chancellor has pointed to a cocktail of risks in direct contrast to his position at the autumn statement in November. The concern is that the economy is at a turning point. We shall see. There are tough days ahead but there is no reason to panic. Not yet anyway. Continue reading...

Influential financial body estimates $30/tonne tax on emissions from international transport could have raised $25bn in 2014, reports Climate HomeThe International Monetary Fund is calling for a carbon tax on aviation and shipping to help deliver global climate goals.

In pursuing its domestic objectives, China risks inadvertently amplifying global financial instabilityThe recent decline in China’s currency, the renminbi, which has fuelled turmoil in Chinese stock markets and drove the government to suspend trading twice last week, highlights a major challenge facing the country: how to balance its domestic and international economic obligations. The approach the authorities take will have a major impact on the wellbeing of the global economy.The 2008 global financial crisis, coupled with the disappointing recovery in the advanced economies that followed, injected a new urgency into China’s efforts to shift its growth model from one based on investment and external demand to one underpinned by domestic consumption. Navigating such a structural transition without causing a sharp decline in economic growth would be difficult for any country. The challenge is even greater for a country as large and complex as China, especially given today’s environment of sluggish global growth. Continue reading...

Growth in the solar industry was not shared equally across all types of jobs in 2015 – employees of installation companies accounted for 65% of jobs addedThe US solar industry now employs more workers than oil and gas, a new report from the Solar Foundation claims, with most of the jobs in power panel installation.Last year, the US solar industry grew by 20% for a third year in a row, according to the foundation’s National Solar Job Census 2015. By the end of 2015, it employed nearly 209,000 solar workers, more than those employed in oil and gas extraction.Related: Oil price forecast to fall to $20 a barrel, predicts Morgan Stanley Continue reading...

Brussels is cracking down on tax breaks for big business. And about time tooThe sentence that follows may be among the rarest in British newspapers, but here goes. A big hand for the European commission for doing an excellent thing. This week, the commission ruled that Belgium has been granting an illegal tax break to at least 35 global companies. The Belgian government will now be forced to recover the unpaid taxes – equivalent to about £530m – from the companies. Last October, it was Luxembourg that was in the firing line – ordered by the commission to recover up to £22.5m from a subsidiary of Fiat. The Netherlands also ran into grief last year over a deal it made with Starbucks. All three countries have been caught out by a series of investigations led by the EU’s competition commissioner, Margrethe Vestager, into countries cutting special tax deals with massive multinationals. The EU is going after cases where member countries have granted individual tax breaks to big companies, without making them available to all the businesses there.How much money is at stake? Consider Anheuser-Busch InBev, the largest brewer in the world, the manufacturer of Stella Artois and Budweiser among others, and capitalised on the stock market at $189bn. It has a Belgian subsidiary making profits of about £45m a year. Belgium’s official corporate tax rate is 34%, which implies that the unit should pay about £15m a year in corporation tax. Instead it enjoys a rate of about 4% which brings its corporation tax payments down closer to £1.8m a year. Its parent company also has its headquarters in Belgium and, according to the New York Times, paid “a small fraction of 1% on its reported profit of … $1.93bn [£1.34bn] in 2014”. Continue reading...

Albert Edwards joins RBS in warning of a new crash, saying oil price plunge and deflation from emerging markets will overwhelm central banks, tip the markets and collapse the eurozoneThe City of London’s most vocal “bear” has warned that the world is heading for a financial crisis as severe as the crash of 2008-09 that could prompt the collapse of the eurozone.

IMF chief says global economy needs to tame hot money, to help developing economies achieve stable growth

Study of Keynes’s foreign exchange dealings between the first and second world wars reveals a chequered recordMarkets can remain irrational longer than you can remain solvent. Such is the advice John Maynard Keynes is supposed to have given to would-be investors looking to make a killing in the period between the first and second world wars.There is some dispute about whether Keynes ever delivered this warning. What is not at issue is that it was advice he did not always follow, especially when it came to his dabblings in the currency market. Continue reading...

Five years on from pledge to rebalance the economy, manufacturing output is no higher than in 2011, with sector officially back in recessionA Britain “carried aloft by the march of the makers”. That was the country George Osborne envisaged in the peroration to his 2011 budget speech. The message from the chancellor was clear; gone were the days when the economy relied on debt-fuelled spending. The clock was being turned back to the days when Britain actually made stuff.Related: Weak UK manufacturing data hits the pound - business liveRelated: UK's industrial sector ends 2015 on a low note Continue reading...

Austerity does not come naturally to Brazilians, but attitudes are changing as economy suffers what is forecast to be the deepest crisis in more than a centuryWhen it comes to mood making in Brazil, there are few institutions that can match the samba schools of Rio de Janeiro.

Output declined in November, amid Chinese woes and a falling oil price, setting the tone for a difficult 2016The pound has tumbled to its lowest against the dollar since June 2010 as investors reacted to an unexpected and broad-based downturn in Britain’s industrial sector that hit factory output, mining and energy production.Related: Weak UK manufacturing data hits the pound - business liveRelated: March of the makers remains a figment of Osborne's imagination Continue reading...

Despite fighting words from the central bank and Communist party leaders, banks are calling the currency lower, pulling oil and stocks down furtherThe Chinese authorities have resorted to “nuclear strength” weapons to deter an attack on the yuan by short sellers and convince sceptical investors that they are in control of the country’s spluttering financial system.

Government continues to trumpet Trans-Pacific Partnership’s ‘enormous benefits’ despite analysis showing Australia’s growth will be worse than 11 of the other 12 countries in the dealThe federal government maintains the Trans-Pacific Partnership agreement will deliver “enormous benefits”, despite World Bank analysis showing Australia’s economy will grow by less than 1% as a result of the deal.Australia’s increased growth is projected to be worse than 11 of the other 12 countries that signed the deal last year, according to the report on the global implications of the deal. Only the US fares worse. Continue reading...

Leading Wall Street bank says price will keep falling if China’s currency continues its plunge against US dollarThe price of crude oil could tumble to $20 a barrel in the coming months if China’s currency continues to decline against the US dollar, one of Wall Street’s leading investment banks has predicted.On a day when the cost of crude hit a new 12-year low and edge closer to the $30 a barrel level, Morgan Stanley posted a forecast on Monday of $20-25 a barrel for oil based on movements in currencies.Related: China shares fall another 5%, Europe slips back as oil tumbles - as it happened Continue reading...

All the latest economic and financial news, as Shanghai stocks slide again despite Beijing’s claims that its financial system is ‘largely stable and healthy’

If its first week is anything to go by, 2016 could be an even more turbulent year than the last. Is there an antidote to barbarity and economic decline?As the world’s attention was captured by Madaya, the Syrian town suffering mass starvation, supporters of the Assad regime began posting photographs of delicious food to insult those starving. When a Muslim woman stood in silence at Donald Trump rally, wearing a T-shirt saying “I come in peace”, she was ejected – Trump’s supporters baying insults into her face.Meanwhile, groups of apparently foreign men in Cologne staged what look like premeditated sexual assaults on women, prompting a new outburst of the racism barely hidden behind German constitutional reality.Related: High demand for reprint of Hitler's Mein Kampf takes publisher by surprise Continue reading...

Monday’s fall in share prices followed a 10% plunge last week which triggered a global sell-off of riskier assetsChinese shares fell 5% to a three-month low after confusion about the direction of the Chinese currency caused wild gyrations on Asian stock markets.A late rush of selling in Shanghai sent the CSI 300 index down 169 points to 3,192 points – its lowest since the aftermath of the summer crisis.Related: Stock market turmoil: China shares fall another 5% - business liveRelated: Australia bet the house on never-ending Chinese growth. It might not end well Continue reading...

Enjoy that refreshed feeling while it lasts – analysts warn that China is in a huge credit bubble, and the jitters can’t be far away for Australian investorsIt’s always great to come back from the holidays ready to get into the new year afresh. Alas, the early signs this year on the economic front are hardly fresh – indeed they seem gloomily repetitive of last year.Related: Australia bet the house on never-ending Chinese growth. It might not end wellRelated: Slowing growth in China raises red flag for global economyRelated: A volatile world is sending stock markets tumbling but don't panicRelated: China interest rate cut fuels fears over ailing economy Continue reading...

Business trends report pinpoints growing job prospects, price cuts and low interest rates

Donor countries are increasingly dipping into their aid budgets to deal with the migration crisisSweden is one of the most generous countries in the world when it comes to international aid. Along with other Scandinavian countries, it has given bounteously to less fortunate nations for many years. With a population of under 10 million, it also takes more than its fair share of asylum seekers - an estimated 190,000 last year, with a further 100,000 to 170,000 expected to arrive in 2016.

George Osborne is now warning of ‘dangerous complacency’ just months after his notably complacent performance in the autumn statementDangerous cocktails were in evidence in many a bar during the Christmas and New Year holidays. I do not know how many the chancellor might have sampled, but his demeanour appears to have been transformed from one of blatant complacency in his autumn statement to pre-budget nerves. He now warns of “a dangerous cocktail of new threats” and, yes, “creeping complacency” in the British economic and political debate.This is not, of course, anything to do with him and the complacency he was fostering as recently as before Christmas. No, this is mainly because of threats to the global economic recovery emanating from a manifest slowdown in China and the impact the collapse of oil prices is having on the economies and finances of oil-producing nations – with the obvious exception of the oil-producing country known as the United States, whose “fracking” boom has made no small contribution to oversupply and falling prices in energy markets. Continue reading...

The economic fundamentals will remain perilous if low- and middle-income workers continue to endure poor payThe US economy ended 2015 with improvement in the labour market. Jobs grew by 284,000 each month on average in the last quarter and if you squint pretty hard at the data you can see a mild acceleration in the pace of nominal wage growth.There will be plenty who will claim this justifies the Federal Reserve’s decisions to raise short-term interest rates for the first time since 2007, and who will argue further that the economic concerns raised by the great recession and its aftermath can now be reshelved. They would then conclude that the focus can return to policy perennials like the need to reduce deficits and ensure that wage and price inflation do not spiral out of control. Continue reading...