Roundup: Our top five posts on economies and markets


The world economy is looking a bit bleak after the recent crisis in Greece and crash in China. Read these five posts to learn how international politics and foreign policy can interfere with markets all over the globe.

The Deflation Shock: Geopolitical Ramifications of the Global Commodity Price Drop: In this article, David Murrin, author of Breaking the Code of History, examines the impact of a global deflation period in various regions.

Deflation driven by loss of global demand like this is not easy to combat, as the Chinese are now realising. For commodity prices to be where they are now, it is clear that the world as led by China is suffering a slump in demand, which suggests that economic growth is much lower than the world’s stock markets are trying to reflect. This suggests that an imminent and very large asset reprising will take place in the months ahead.

How did London become ground zero for the global plutocracy? Peter Apps, executive director of PS21, looks at the transformation of London properties into vehicles for tax evasion.

London – and, for that matter, the global network of trading cities it gave birth to such as Dubai, Singapore and Hong Kong – promises both the rule of law and utter opacity. It’s just the right balance to appeal to dubious people with colossal quantities of money.

According to Transparency International’s analysis of data from the Land Registry, 36,342 London properties are owned by what they call “offshore haven companies”. That means trusts or companies headquartered in places like the Channel Islands or British Virgin Islands. These can be remarkably effective in masking true ownership.

Two World-Changing Deals: Greece and Iran: Jack Goldstone, expert on revolutions at the Woodrow Wilson Center and George Mason University explores both deals and their effects on foreign currencies, US foreign policy and their respective regions.

After endless, and sometimes seemingly hopeless, negotiations, diplomats have produced two new multinational deals that go a long way toward righting what’s been going wrong in the world: one on nuclear development in Iran and the second to keep Greece in the euro.

Both of these deals provide better outcomes than failed negotiations would have. They demonstrate that dedicated diplomacy can still achieve positive solutions within an integrated global system that is more or less still functioning.

When markets meet geopolitics: an interview with Emad Mostaque: Watch this video interview with Ecstrat strategist Emad Mostaque to learn about the implications of the stock market crisis in China and Greece’s sovereign debt crisis on the global economy.

The structural factors that have contributed to both the Greek and the Chinese crises have been brewing for a while, but one of the key things is that they’ve effectively come to the end of their rope in many ways. Greece came to a point whereby it basically needed a bailout. In China’s case, it basically came to the point whereby the government can no longer refinance its economy through the stock market.

PS21 Insight: Eurozone clinches deal, serious strains remain: Finally, for more on the Greek deal, read our report on the referendum, with insight from Sir Michael Leigh, senior advisor to the German Marshall Fund of the United States, Giulia Pastorella, Italian political economist, and Peter Apps, executive director of PS21.

Leigh: The continued readiness of both sides to seek a compromise rather than slam the door is encouraging. The result, though, is a muddle-through which Greece and the creditors will find hard to sell to their constituencies. The improvised series of finance ministers and summit meetings demonstrates the lack of a dependable system of Eurozone governance and the prevalence of short-term political thinking over sound economics.

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