Financial crisis of 2007–08

Here’s an excellent article from the Peterson Institute for International Economics. It reports that China initiated a harsh crackdown on cryptocurrencies in early September, part of a broader toughening against financial risk and increased regulatory vigilance on new financial products.

Source: Why China Is Cracking Down on Cryptocurrencies and ICOs | PIIE

This article shows us that China has learned from America’s political weakness on finance and is ready to intervene decisively. Remember President Clinton‘s repeal of the Glass Steagall Act probably precipitated the 2008 financial crisis. And after the crisis, China boldly intervened with massive state sponsored investment – many Western observers thought China would have a hard landing but it never happened.

Thoughts?

IMF Headquarters, Washington, DC. (Photo credit: Wikipedia)

This is an excellent read published in the IMF Blog. It highlights that after being largely stable in many countries for decades, the share of national income paid as labour costs is declining.

Source: Drivers of Declining Labor Share of Income – IMF Blog

Since the 2008 financial crisis, working class and middle class families in many Western countries have struggled, often with incomes declining in real terms and public services under threat from austerity.

In political terms, both the far-left and the far-right have intervened with populist policies. But the issue is about changing economic fundamentals. Labour is less important to national output with increased dependence on technology.

In this excellent blog, the IMF marshals the evidence with clear argument and illustration.

For me, politicians are not being honest with voters about future jobs losses. It’s interesting to reflect on the French presidential race and whether Macron’s candid views on future job opportunities is politically advantageous.