Science fiction was serious stuff when I was a child, Douglas Adams showed it could be funny – plus he included something for us economists, tooThere are books that you know before reading them will change you. There are books you read precisely because you want to change yourself. But The Hitchhiker’s Guide to the Galaxy belonged to neither category. In fact, H2G2 (as a tribe of Douglas Adams fandom calls it) is special because I didn’t expect it to have any effect on me, let alone one so enduring. I don’t even remember exactly when I read it, except that it was in the first few years of my arrival in Britain as a graduate student in 1986. The only thing I remember is being intrigued by the description of it as a piece of comedy science fiction (SF).I had been a fan of SF since I was 10 or 11, when I started devouring what I could from the rather meagre selection (often in simplified children’s editions) available in Korea in the 1970s and 80s. SF was serious stuff then: intergalactic wars and imperialism (Skylark), technological dystopia (Brave New World), post-apocalyptic worlds (On the Beach, The Day of the Triffids). It wasn’t supposed to be comical.The Hitchhiker's Guide wasn’t just hilarious, it was beyond my then mental universeRelated: The Picture of Dorian Gray made me forever suspicious of the self-righteous | Deborah Orr Continue reading...

Mass public frenzy, hype and hysteria? Or private panic and adolescent crisis? Suggest songs all about seeing it wrongly, whether in history or just in your head

As talks continue over proposed €86bn third bailout, Greek treasury says tax revenues fell 8.5% in a year, and public spending fell 12.3%Fresh evidence of the dramatic impact of the Greek debt crisis on the health of the country’s finances has emerged, with official figures showing tax revenues collapsing.As talks continued over a proposed €86bn third bailout of the stricken state, the Greek treasury said tax revenues were 8.5% lower in the first six months of 2015 than the same period a year earlier. The bank shutdown that brought much economic activity to a halt began on 28 June.Related: After the Greek crisis, it's time for a new deal on debt Continue reading...

City analysts push prospect of a rate rise into 2016 as only one MPC member votes for an increaseFears that the Bank of England is poised to start raising interest rates have receded, after news that just one of the nine members of its policy committee voted to increase borrowing costs from their record low of 0.5% this month.City analysts pushed their forecasts for the first rate rise since 2007 into next year after the Bank revealed that Ian McCafferty, former chief economist at business group the CBI, cast the sole vote for higher rates when the monetary policy committee met on Wednesday.Related: Bank of England's Super Thursday – live Continue reading...

Ipsos survey of 24 countries reveals a majority of many populations think migration is changing their nation in ways they don’t likeNearly one in two people in the world’s most advanced economies believe immigration is causing their country to change in ways they don’t like, according to a new poll.In many countries this is true in more than half of the population – in Turkey (84%), Italy (65%), Russia (59%), and in Belgium, France, Israel, South Africa, Great Britain, Hungary and India, the survey by global research company Ipsos found.Related: The truth about the people and numbers in loud and furious migration debate Continue reading...

The simultaneous release of economic documents does little to improve market understanding of the UK economy“Super Thursday” didn’t quite live up to the grand billing. The moment of the first hike in interest rates is getting closer, said the Bank of England governor, Mark Carney, but it is also clear that this song could remain the same for some time. Only one member of the monetary policy committee, not the expected two, voted for a rate hike. It is now highly unlikely that interest rates will rise this year.Despite Carney’s many references to “robust momentum” in the economy, next May is viewed by financial markets as the most likely moment the Bank increases the cost of borrowing. The mildly dovish message was echoed in the currency markets: the pound fell 0.75%. Continue reading...

The US has become an obstacle to reshaping international laws for tax, debt and finance, writes Joseph StiglitzThe Third International Conference on Financing for Development recently convened in Ethiopia’s capital, Addis Ababa. The conference came at a time when developing countries and emerging markets have demonstrated their ability to absorb huge amounts of money productively. Indeed, the tasks that these countries are undertaking – investing in infrastructure (roads, electricity, ports, and much else), building cities that will one day be home to billions, and moving toward a green economy – are truly enormous.At the same time, there is no shortage of money waiting to be put to productive use. Just a few years ago, Ben Bernanke, then the chairman of the US Federal Reserve Board, talked about a global savings glut. And yet investment projects with high social returns were being starved of funds. That remains true today. The problem, then as now, is that the world’s financial markets, meant to intermediate efficiently between savings and investment opportunities, instead misallocate capital and create risk.Related: Development finance summit: milestone or millstone for the world's poor? Continue reading...

Bank will release its decision on interest rates, how the monetary policy committee voted, and the quarterly inflation report, its latest view on the state of the UK economyWhat is Super Thursday?Thursday is the day the Bank of England will announce three major pieces of information: its decision on interest rates; the minutes of the monetary policy committee’s meeting at which that decision was reached; and the quarterly inflation report, its latest view on the state of the UK economy.Related: City braced for Bank of England's Super Thursday – business liveRelated: Why Mark Carney shouldn’t rush to play the rate-rise card Continue reading...

Urban planner Finn Williams uses the building simulator to create a ‘post-growth city’ with an economy based on social exchange rather than consumption

Paul Mason argues that information technology can restructure global economics Continue reading...

Mark Carney’s tone will pave way for market predictions over interest rate increases – but the data dump may make it harder to scrutinise Bank thinkingIt’s Super Thursday and the City scribblers can barely contain their excitement. It is the day when they get not one, not two, but three big pieces of information about the economy from the Bank of England.Threadneedle Street will announce its latest decision on interest rates. It will publish the minutes of the meeting of the Bank’s monetary policy committee at which that decision was made. And it will present the quarterly inflation report, its take on the state of the nation.Related: The recovery seems to be strong – but a rate rise will bring it crashing down Continue reading...

Greek prime minister says agreement could end uncertainty over country’s place in eurozone as its banks take a stock market hammeringGreece is “in the final stretch” of talks with lenders on a multibillion-euro bailout, the country’s prime minister, Alexis Tsipras, has said, on a day when banks suffered more punishing losses on the Athens stock market.Greece and its creditors are racing to agree a complex, three-year deal worth up to €86bn (£60bn) by 20 August, when Athens must come up with €3.5bn to repay debts to the European Central Bank.

EU government ministers and business leaders are racing to begin new era of cooperation with Tehran – regardless of what US and Israeli sceptics sayAs debate rages among politicians and pundits in Washington over whether to endorse last month’s historic nuclear compromise with Iran, key European allies have already given their verdict: a resounding thumbs-up.Government ministers and business leaders in France, Germany, Italy and elsewhere in the EU are racing to open up a new era of diplomatic, trade, investment and possible future military cooperation with Tehran, regardless of what American and Israeli sceptics say. Continue reading...

Dodd-Frank Act forces US corporations to reveal what their CEOs earn compared with the average worker, but some companies are already embracing pay transparency to build corporate reputation, says Phil DrewInequality is back in the spotlight as the US Securities and Exchange Commission prepares to vote on pay ratios. For the first time, America’s largest businesses could be forced to publish how much more their chief executives earn than the average worker.The disclosure, required under the 2010 Dodd-Frank Act, has long been in the pipeline. If voted in, businesses can expect the new rules to inspire greater levels of scrutiny. Research by Harvard Business School shows people have no idea how much CEOs earn and, when asked, grossly underestimate their boss’s pay. In the US, CEOs earn up to 300 times more than the average salary, yet most estimate the gap to be a fraction of this, at 30 times the average wage.Related: Growth is not the answer to inequalityRelated: Two cheers for the Dodd-Frank Act – but Wall Street culture needs radical changeRelated: Business must collaborate - without it the world is brutal and terrifyingRelated: Don’t blame rising inequality on technological change | Owen Jones Continue reading...

Latest PMI figures suggest economic recovery is slowing, with possible knock-on effects on Bank of England interest rate risesBritish services companies grew less than expected last month as hiring eased to its slowest pace since March 2014, suggesting the economic recovery weakened at the start of the second half of this year.Wednesday’s Markit/Cips services purchasing managers’ index (PMI) fell to 57.4 in July from 58.5 in June, undershooting a Reuters forecast for 58.0 but still indicating expansion among services businesses. Continue reading...

Global research by Ipsos Mori also shows that Brazilians’ confidence in their economy has declined considerably during the last five yearsBrazil has been through a lot in the past couple of years (and that is not limited to the national football team’s 7-1 thrashing by Germany in the semi-final of their own World Cup). In June, the Latin American powerhouse posted its worst economic results in six years with a year-on-year drop of 1.6% in GDP.This economic faltering is being felt by the country’s inhabitants. Three years ago, 57% of Brazilians thought their economy was in good health, according to the results of a global poll by Ipsos Mori. But the latest figures for July this year show that figure has now dropped to just 12%, although that is a small rise on the 9% recorded in June. Continue reading...

The mayor of Rio de Janeiro, Eduardo Paes, admits cause for concern in Brazil's darkening political and economic climate, but says Olympic organisers would not fall prey to the gloom. Brazil's economic struggles and a huge corruption scandal have engulfed the nation one year ahead of the 2016 Olympic Games, while some venues, such as the velodrome and hockey pitches, are only half complete Continue reading...

NIESR claims that a haircut of 55% on Greek debt is needed to give the country a chance of reducing its debt to 120% of GDPGreece’s economy will suffer fresh damage from the austerity measures demanded by its creditors and will remain stuck in permanent depression unless it receives substantial debt relief, one of the UK’s leading thinktanks has warned.The National Institute of Economic and Social Research said the increases in VAT reluctantly accepted by the Syriza-led coalition in Athens in exchange for a new bail out will result in a 1% fall in national output in 2016.Related: Greek bank shares slump again but creditor talks make progress - as it happenedRelated: After the Greek crisis, it's time for a new deal on debt Continue reading...

Independent review shows abiding concern over economic deficit, and may fuel doubt about policies of Labour leadership frontrunner Jeremy CorbynPolling undertaken for an independent review being led by Jon Cruddas, the Labour MP and former coordinator of the party’s 2015 manifesto, shows Britain’s voters do not back an anti-austerity message but instead believe the country must live within its means and make cutting the deficit its top priority.The findings, given to the Guardian, are likely to make difficult reading for those that say Labour’s path to electoral recovery lies in the party adopting a stronger anti-austerity stance than in the run-up to this year’s election.Related: Public opinion doesn't matter in the Labour leadership election. I'm following my conscience and Jeremy CorbynRelated: Labour leadership vote: Harriet Harman asks MPs to vet new party members Continue reading...

There would have been risks in restructuring Europe’s debt, but running those risks would have been well worth itThe International Monetary Fund’s acknowledgement that Greece’s debt is unsustainable could prove to be a watershed moment for the global financial system. Clearly, heterodox policies to deal with high debt burdens need to be taken more seriously, even in some advanced countries.Ever since the onset of the Greek crisis, there have been basically three schools of thought. First, there is the view of the troika (the European Commission, the European Central Bank, and the IMF), which holds that the eurozone’s debt-distressed periphery (Greece, Ireland, Portugal, and Spain) requires strong policy discipline to prevent a short-term liquidity crisis from morphing into a long-term insolvency problem.Related: Greek banking shares take another hammering as key talks continue - live Continue reading...

MP dismisses ‘plots and name-calling’, and urges campaign of ‘malice-free decency’ in style of Abraham LincolnJeremy Corbyn has brushed aside suggestions that he would face an internal coup to depose him if he became Labour leader, saying he would follow the example of Abraham Lincoln who acted as a unifying figure after the American civil war.Established party figures, led by Neil Kinnock and Peter Mandelson, have warned of the “dangers” of a Corbyn victory. Corbyn, in Leeds at the launch of an economic plan to rejuvenate the north of England, said: “Plots and double plots and sub-plots and plotting – it’s fascinating. I think Abraham Lincoln made a point. At the end of the American civil war he said, ‘with malice toward none and charity towards all’ we will go forward, I am sure that is the right way to do things.” Continue reading...

Making a case for Brexit based on events in Greece doesn’t make sense unless you have a distorted view of Syriza’s failures and the reasons for the crisisIs the Greek crisis a reason for Britain to quit the European Union? Several Guardian columnists – Owen Jones, George Monbiot and Suzanne Moore – have argued that it is. But this is mistaken. Their conclusions are based on a distorted view of what is happening in Greece.Related: Greece doesn’t want to leave Europe, and neither should Britain | Alan JohnsonWhat is progressive about people not paying taxes and retiring under the age of 50?David Cameron has been careless in calling such a vote and blithely assuming he can rely on Labour backing yes solidly Continue reading...

World’s leading economies still paying trillions in subsidies despite pledges to phase them out, new figures showSubsidies for fossil fuels amount to $1,000 (£640) a year for every citizen living in the G20 group of the world’s leading economies, despite the group’s pledge in 2009 to phase out support for coal, oil and gas.The [new] figures reveal the true extent to which individual countries are subsidising pollution from fossil fuelsRelated: Fossil fuels subsidised by $10m a minute, says IMF Continue reading...

Scientists are still attempting to gauge what possible effects the melting of the Arctic ice sheet will have on the British weather. For example, is the Gulf Stream going to slow down sufficiently to give us colder winters and are we already getting more storms during the summer because the jet stream has moved?So, it is a surprise to see a confident prediction of one potential effect. According to the Netherlands Bureau for Economic Policy Analysis, the lack of polar ice is going to make us wealthier. Continue reading...

Banks lose 30% as Athens stock market opens for the first time since late JuneThe full extent of the damage caused by the Greek crisis was laid bare when the first day of stock market trading after five weeks of economic paralysis saw shares lose a sixth of their value.Bank stocks bore the brunt of a wave of pent-up selling that eclipsed anything seen in the past three decades on the Athens stock market, with three of the leading Greek financial institutions losing the maximum 30% permitted in a single day’s trading.Related: Greece debt crisis: Athens stock market ends 16% lower as manufacturing plunges - as it happened Continue reading...

Your editorial’s argument about a causal link between slowing population growth and increased economic growth (Fewer people means more carbon: the population paradox, 3 August) is dangerously out of date.In its 2014 report, the Intergovernmental Panel on Climate Change showed how the reduction through efficiency of CO emissions from fossil fuels was wiped out by population increase, the real paradox being why it then offered pages of energy policy advice, but not a word on population. Could it be that the IPCC – and you – are blinded by the logic that regards economic growth as more important than carbon emissions and misery for lots of women and children? Continue reading...

The financial crisis showed how important Libor had become in globalised markets – the rigging scandal showed how much it had been abusedLibor first shot to prominence during the financial crisis when it emerged as a signal that banks were panicking. This is because Libor – shorthand for the London interbank offered rate – is the price at which banks estimate their rivals will want to lend to them. During the crisis, those banks that admitted they expected to be charged the highest interest rates by their peers were perceived to be the riskier ones.The £290m fine for rigging the rate imposed on Barclays in 2012 showed Libor in an entirely different light. The penalty and subsequent ones imposed on other banks and brokers showed that the rates themselves were being manipulated. It also meant they may not have been a true reflection of wider borrowing costs paid by companies and households worldwide.Related: Former City trader Tom Hayes convicted of Libor rigging Continue reading...

It’s also a moral imperative for those who truly wish to help the world’s poor, which the presidential candidate claims to supportBernie Sanders has come out against open borders, claiming they are a “right-wing proposal” that “would make everyone in America poorer.” He argues that, while we have a “moral responsibility” to “work with the rest of the industrialized world to address the problems of international poverty... you don’t do that by making people in this country even poorer.”Related: Bernie Sanders: structural racism needs to end for economic justice to succeed | Sabrina Hersi IssaMassimino is a campus coordinator for Students For Liberty, which receives funding from the Koch Brothers. He was not compensated for writing this piece. Continue reading...

CIPS/Markit’s monthly economic health check shows stagnant manufacturing sector is dependent on UK consumer and could hold back economic growthThe strength of the pound is holding back UK exports and keeping factory output barely above recession levels despite a rise in activity in the eurozone.The monthly health check from the Chartered Institute of Procurement and Supply/Markit found that buoyant consumer spending helped British industry edge up from a 26-month low in June.Related: Greece debt crisis: Athens stock market falls 23% as manufacturing plunges - live Continue reading...

Exchange in Athens falls 23% in value in early trading with banks and financial shares hurt by up to 30% after enforced closureGreece’s stock market plunged nearly 23% on Monday when it reopened after a five-week shutdown brought on by fears that the country was about to be dumped from the eurozone.The main Athens stock index fell to in worst ever one-day performance after only a few minutes of trading.Related: Greece debt crisis: Athens stock market falls 23% after reopening - liveRelated: Greek shares set to fall sharply as Athens stock market reopensRelated: Who’d be young and Greek? Searching for a future after the debt crisis Continue reading...

After a five-week shutdown designed to save the country’s banks from collapse, traders predict heavy selling amid more falls in Asian marketsGreek investors expect a tumultuous day’s trading when Athens’ stock market reopens on Monday after a five-week shutdown.The resumption of trading in Greek stocks will be the latest step back towards economic normality, after the prime minister, Alexis Tsipras, struck a deal with the country’s creditors to open talks on an €86bn (£61bn) third bailout.Related: Now a deal has been done, what lies ahead for the Greek economy?Related: Chinese shares are falling, but the real fear is that the economy itself is slowing Continue reading...

Bank of England to reveal key interest rate decision, discussions behind it and quarterly economic forecasts on same day for first timeBritain’s mortgage borrowers will be warned this week to brace themselves for higher interest rates on what City of London traders have dubbed “Super Thursday”. At least two, perhaps three, of the nine members of the Bank of England’s interest rate-setting committee are expected to cast their votes for a rate rise.Confirmed hawks Martin Weale and Ian McCafferty, who voted for rate rises throughout the second half of 2014 before changing their minds as inflation plunged to zero earlier this year, have signalled they could soon be ready to see borrowing costs rise.Related: Why Mark Carney shouldn’t rush to play the rate-rise card Continue reading...

To gauge how high interest rates will go, and how fast, we need to understand how fiscal and monetary policy interact, writes Gavin KellyWith prominent members of the Bank of England’s monetary policy committee (MPC) – not least the governor – lining up in recent weeks to talk up the prospect of rate rises at some point in the coming months, this week’s meeting has already sparked another burst of speculation about when the first hike in eight years will happen.Whatever your take on the exact timings of monetary lift-off – whether you’d opt for August or April – the far more important issue is the medium-term path of increases that follow. Continue reading...

More profits need to be redirected away from shareholders and reinvested in plant, process and people if technology is not to exacerbate inequalityLook around and it seems pretty obvious that technology has made daily life easier.We can watch almost any film or listen to any song at the press of a button. People pay their bills on their mobile phones. Stressed parents get to dodge trolley tantrums by swapping the supermarket run for online shopping. And let’s not mention all that free online news. Continue reading...

Some on the monetary policy committee at the Bank of England are likely to press for increases, but the recovery remains weakGeorge Osborne has repeatedly promised to fix the roof while the sun is shining, and after official figures last week showed GDP growth picking up sharply in the second quarter, it seemed that the clouds have finally lifted.With the Bank of England’s policymakers due to meet on Thursday, the news that the slowdown in the first quarter was just a blip sent traders scrambling to price in an interest rate rise in the coming months. Continue reading...

The chancellor seems increasingly willing to resort to ‘fiddling the figures’ – something for which he castigated Gordon BrownWhen thousands of poor American families saw the homes they had loved and saved for seized by the banks in the depths of the sub-prime mortgage crisis, it was scant comfort that they had only been able to afford to clamber on to the property ladder in the first place because of reckless lenders, toothless regulators and short-sighted politicians. Losing your home is losing your home.Yet when George Osborne contemplates the cuts many households will face as a result of his planned reductions in tax credits – three million will lose £1,000 a year, says the Institute for Fiscal Studies – he wants to kid us, and maybe himself, that it doesn’t matter because the state could ill afford such generosity to the needy in the first place. Continue reading...

The agriculture minister has not given up on Australia signing the TPP and says the trade minister, Andrew Robb, is still ‘at the table’The agriculture minister, Barnaby Joyce, has not given up on Australia signing the Trans-Pacific Partnership, potentially the world’s biggest regional trade agreement.Week-long negotiations over the TPP ended in Hawaii on Saturday without an agreement. Sticking points for Australia are sugar and dairy, but Joyce says the process is ongoing.Related: Australia walks away from Trans-Pacific Partnership trade deal talks Continue reading...

Disastrous losses on the Shanghai exchange are leading to concern that the era of runaway Chinese growth is faltering at a critical time in the world economyRecent events in Shanghai’s stock markets have been all too reminiscent of the tales that have entered American folk memory from the days of the Wall Street crash in 1929: of stock-tipping shoeshine boys, exhausted traders, and ticker-tape machines spooling late into the night.In China, the Shanghai Composite Index lost more than 8% of its value last Monday, and shares have suffered their worst month for six years, falling by 29% since they peaked in June. Continue reading...

Alexis Tsipras defends Yanis Varoufakis in the Greek parliament on Friday despite the former finance minister's poor taste in shirts. Tsipras says there are many things that Varoufakis can be blamed for, including his sense of style, but says the former finance minister cannot be accused of being a crook or having a covert plan to bring Greece to the precipice Continue reading...

The three ex-employees are the first bankers to be imprisoned for actions that helped turn the Celtic Tiger boom to bustThree officials from the bank that almost bankrupted Ireland have become the first bankers to be jailed for offences related to the Republic’s financial crash.The failure of Anglo Irish Bank, which became synonymous with the casino-style lending practices that drove Ireland’s “Celtic Tiger” boom and subsequent bust, cost the state €30bn (£21bn), part of what forced the government to seek a bailout from the European Union and the International Monetary Fund. Continue reading...