PARIS – Eurozone monetary officials are expected to make history when they gather for the European Central Bank’s next policy-setting meeting on January 22. Observers anticipate that ECB President Mario Draghi and his colleagues will finally cross the Rubicon and announce the launch of a large-scale program of quantitative easing (QE) – in other words, high-volume purchases of government bonds. Though the ECB has resisted QE for more than five years, even as other major central banks embraced it, Executive Board member Benoît Coeuré has already called it the “baseline option.”
NEW YORK – For several years, and often several times a month, the Nobel laureate economist and New York Times columnist and blogger Paul Krugman has delivered one main message to his loyal readers: deficit-cutting “austerians” (as he calls advocates of fiscal austerity) are deluded. Fiscal retrenchment amid weak private demand would lead to chronically high unemployment. Indeed, deficit cuts would court a reprise of 1937, when Franklin D. Roosevelt prematurely reduced the New Deal stimulus and thereby threw the United States back into recession.
LAHORE – On December 16, the Taliban attacked an army school in Peshawar and killed 132 children and nine adults. Eight terrorists dressed in military uniform penetrated the school’s well-guarded perimeter and opened fire on the students and school personnel. Pakistani army commandos fought the intruders for several hours before killing the last attacker.
CAMBRIDGE – With Western economic sanctions against Russia, Iran, and Cuba in the news, it is a good time to take stock of the debate on just how well such measures work. The short answer is that economic sanctions usually have only modest effects, even if they can be an essential means of demonstrating moral resolve. If economic sanctions are to play an increasingly important role in twenty-first-century statecraft, it might be worth reflecting on how they have worked in the past.
NEW YORK – When Typhoon Hagupit made landfall in the Philippines on December 6, memories of Typhoon Haiyan, which killed more than 6,300 people, were fresh in people’s minds. Some 227,000 families – more than a million people – were evacuated ahead of Hagupit’s arrival, according to the United Nations. The typhoon, one of the strongest of the season, killed some 30 people. All deaths from disasters are a tragedy, but the fact that this number was not much higher attests to the efforts that the Philippines has made to prepare for natural disasters.
LONDON – In October, two groups researching the effectiveness of a potential breakthrough drug in the fight against HIV did something unusual. They announced that the therapy they were testing, an antiretroviral drug called Truvada, had proved effective enough to end the randomized phases of the trials, and that they were offering the pill to all of the studies’ participants.
The researchers found that gay men who take Truvada, in addition to using condoms when they have sex, were significantly less likely to contract HIV. This is further evidence of the effectiveness of pre-exposure prophylaxis (PrEP), a technique by which people who are HIV-negative use antiretroviral drugs to protect themselves from infection. In 2011, a trial funded by the Gates Foundation found that straight couples using Truvada reduced the risk of transmitting HIV by 73%.
BERLIN – Let us imagine for a moment that we could change the world according to our wishes. Dramatic economic inequality gives way to social and political inclusion. Universal human rights become a reality. We end deforestation and the destruction of arable land. Fish stocks recover. Two billion people look forward to a life without poverty, hunger, and violence. Rather than paying lip service to climate change and resource scarcity, we start to respect and uphold the limits of our planet and its atmosphere.
Over the last five years, several low-income countries, such as Rwanda and Honduras, have issued their first-ever bonds to private foreign investors in London and New York. Until recently, that might have been unthinkable, so the new borrowers' initial bond issue should be viewed as a sign of great investor confidence. But it should also sound some familiar warning bells.
Some 20 “debut issues” have raised around $12 billion at interest rates that, on average, are just 4.5 percentage points above what the United States government pays at maturities of five or more years. This is small change in the grand scheme of global finance; but, given that many of these borrowers were in distress or default just a decade ago, and needed debt forgiveness, theirs is an especially impressive turnaround.
But low-income countries' access to private lenders comes with risks that should be highlighted at the outset, before they grow into imminent threats.
My fellow Liberians:
Many had hoped that time would heal but sadly, since the suspension of her license to practice law in the country, the former Minister of Justice has been bitter and angry – bitter with the Supreme Court and angry with the President. In her own words, she experienced the height of “personal pain when my hard-earned professional asset was suspended and my credibility called into question”. It may prove to be in the best interest of the country that she has finally mustered the courage to exercise her prerogative to resign.
WASHINGTON, DC – Over the last five years, several low-income countries, such as Rwanda and Honduras, have issued their first-ever bonds to private foreign investors in London and New York. Until recently, that might have been unthinkable, so the new borrowers’ initial bond issue should be viewed as a sign of great investor confidence. But it should also sound some familiar warning bells.