It is understandable that some people are on the lookout for villains to blame in this time of national crisis – and who better than City ‘fat cats’ who are ‘profiting from the misery of others’? But it usually only takes a moment of serious thought to realise that these attacks are well wide of … Continue reading Why bans on ‘short selling’ are a bad idea
"I'm shocked, SHOCKED, that an emerging markets fund co-founded by Jacob Rees-Mogg is taking advantage of lower equity prices to buy shares in, er, Brazilian healthcare companies and South African chemist chains. This SICKENING behaviour, er, (cont. p94)..." (with apologies to the Private Eye’s Dave Spart) I’ve written before about the lazy narrative of ‘disaster … Continue reading ‘Disaster capitalism’ revisited – the case of Somerset Capital
Since responding to Toby Young's article here I've come across a few interesting US papers on the economics of pandemics. These studies (which have also been picked up elsewhere) support the view that the coronavirus lockdown is indeed 'worth it'... First, a cost-benefit analysis of social distancing for the US, which suggests that the benefits … Continue reading Is it worth it? a brief PS…
Toby Young has been given plenty of stick for an article which asked whether the UK government has overreacted to the coronavirus crisis by locking down the economy, and which concluded that it had. In my view, he was right to pose the question, but gave the wrong answer. The thrust of his argument is … Continue reading Is it worth it?
On Friday (27th March), the credit rating agency Fitch downgraded the UK’s sovereign credit rating by one notch, from AA to AA-, citing worries about the economy and a jump in government debt. Bond investors at least are shrugging this off. But the announcement has revived long-standing concerns about the role of rating agencies during … Continue reading Don’t shoot the rating agencies!
Given how trendy it is to blame ‘capitalism’ for all the world’s other ills, from wars to climate change, it’s no surprise that some have been quick to pin the current crisis on the failures of free markets too. Many have also used the need for unprecedented government intervention as evidence that the state should … Continue reading Coronavirus crisis doesn’t mean Corbyn was right
Given that even ‘profit’ now seems to be dirty word, it is no surprise that being accused of ‘profiteering’ during a crisis is about as bad as it can get. But there are some circumstances when an increase in prices in response to exceptional demand can actually be a good thing. By definition, ‘profiteering’ is … Continue reading Can ‘profiteering’ ever be justified?