Daily Archives: April 2, 2013

In announcing that it will restart its nuclear facilities, North Korea seems to many people to be behaving strangely. In fact, North Korea is behaving predictably: it is issuing belligerent statements, cutting off hotlines and taking ever more threatening postures. The big question is: should the response of the world be equally predictable?

The US seems to think so. It refuses to talk directly to Pyongyang, preferring to continue with isolation and sanctions. This is the wrong approach. It is reasonable to fear that North Korea wants war. But its record shows that bellicosity is the only way it believes it can get attention. Maybe it is time to show North Korea that it does not have to behave weirdly to get talks going. Continue reading »

Ben Bernanke is convinced that monetary stimulus will lead us to economic salvation, Mark Carney talks about “escape velocity”, Haruhiko Kuroda hopes that a rise in Japanese inflation to about 2 per cent will pave the way to greater economic riches and, given half a chance, Lord Turner of Ecchinswell would happily launch the monetary helicopters in a bid to deliver more in the way of economic growth. Our masters of money may hope that faster economic growth will arrive but are they right to think that monetary policy can be recalibrated to deliver the goods? Continue reading »