Market Talk

Iceland oversaw a remarkable financial crisis during the late 2000s. With the three largest banks comprising a colossal size of the Icelandic economy, the reverberations from the US and UK sub-prime crises hit the Icelandic economy more than most.

India's economy has witnessed a rapid economic transformation over the past few decades. Beginning in 1991 with a wave of economic liberalisation, successive governments have unlocked India's economic potential through supply-side reforms, with a particular focus on infrastructure and boosting FDI flows.

The Asian Financial Crisis wrought havoc on much of South-East Asian during the late 1990s. What started in Thailand began to affect neighbouring economies, resulting in slowing investment and precipitated economic reforms.

The 1970s oversaw a turbulent period in US history. Huge inflationary pressures coupled with overly tight monetary policies produced stagflation, coinciding with the rise of monetarism and alternative approaches to economic management. Paul Volcker exemplified this - becoming the Chairman of the Federal Reserve and enacting policies that came to be known as the Volcker Shock.

The Panic of 1907 was one of the first of its kind. Preceded by turbulence in insurance markets, the panic grew to encompass the entire US financial system. Given the reliance on the private sector to ameliorate economic conditions at the time, the crisis proved pivotal in the establishment of one of the most influential financial institutions today.

The British East India Company played a pivotal role in the UK's rise as a global leader. From supporting the government's imperial ambitions to promoting trade and wealth accumulation domestically, the British East India Company set the foundations for the Industrial Revolution that followed, alongside the establishing of the British Raj.

Monetary policy in the UK & US has changed drastically over the past decade or so. The financial crisis ushered in an unprecedented amount of stimulus, only to be followed up by a gradual tightening in the late 2010s. The pandemic brought about similarly loose policies, only to be followed by the most aggressive tightening cycle in recent history.

The Polish economy has overseen remarkable economic growth and progress over past decades. Thanks to a series of market-friendly economic policies, with political stability under successive right-leaning political parties since its independence from Soviet control in the early 1990s, a wave of economic confidence and subsequent investment has propelled Poland to becoming one of the strongest economies in the EU.

Japan was left devastated by WW2. Through prudent supply-side policies, Japan reversed its misfortunes. It oversaw rapid economic growth and success, driven by its innovative private sector, culminating in what remains one of the largest economies in the world still to this day.

The Dot-com bubble oversaw rampant speculation in US tech markets. What began in the 1980s as the biggest revolution since the industrial revolution with the rise of the internet and other technologies seeped into financial markets, resulting in one of the biggest financial bubbles in history.

Jeremy Hunt delivered his Autumn Statement against the backdrop of weak economic data; the OBR revised down its growth projections for the UK economy, even given the recent stagnation of past years. Hunt's response to this was further tax cuts and welfare reforms; whilst a step in the right direction, these

The rise of ESG & Green Investing has revolutionised financial markets over the past decade. As corporate responsibility continues to evolve, reaching stakeholders across the global economy, I explore the reasons behind this growth and what the future holds.

Starmer's likely incoming Labour government offers a different alternative to the Conservatives compared to his predecessor, Jeremy Corbyn. After bringing the Labour Party closer to the centre-ground of British politics, Starmer's agenda looks remarkably similar to that of Rishi Sunak - a UK economy faced with ever-higher taxes.

Austerity measures were controversially introduced in the aftermath of the financial crisis and Great Recession of 2008 across most of Europe and Western nations. While the specific policies different amongst countries, the overall goal and approach remained consistent - curbing the budget deficit through fiscal restraint. Were these policies required by financial markets at the time or purely a neoliberal ideological project?

Climate change represents one of the existentual threats to humanity. Utilising economic policy to produce incentive structures to reduce greenhouse emissions is critical to limiting global warming, through policies such as carbon taxes, cap and trade schemes, alongside more targeted subsidy frameworks.

The UK has overseen a sharp rise in house prices over the past three decades, relative to median incomes. Starting under Thatcher, this trend accelerated sharply under Blair, with house prices gradually rising under successive Conservative governments since 2010. Drastic housing reforms are needed to resolve this, addressing both supply and demand-side pressures that left unresolved, will continue to deeply widen wealth inequality in the UK.

As one of the most famous IPOs in history, Facebook became a public-listed company in May 2012, raising capital to fund to its investments into new technologies. I explore the reasons behind the IPO, the alternatives, and why Facebook's IPO wasn't initially a roaring success as many had anticipated.

Private Equity has rapidly become a mainstay in investment portfolios over the previous decade. The aftermath of the financial crisis gave way for the perfect conditions for its growth. Loose credit-conditions, coupled with a lack of alternative investment opportunities are amongst the reasons for its success, but will Private Equity now faces renewed challenges in the coming years.

Barack Obama's economic legacy as President is one that is often misinterpreted. While campaigning on the left of the Democratic Party in his initial bid in 2008, Obama has since governed as a largely moderate figure. From health and tax reform to discretionary spending cuts, Obama's reforms have shaped the US economy for years to come.

The Russian economy has undergone a radical transformation since the dissolution of the USSR in 1991. Following a decade of turmoil during the 1990s, a renewed sense of economic optimism contributed to strong economic growth in the 2000s. With this said, the future of the Russian economy appears uncertain following its invasion of Ukraine.

Milton Friedman's diagnosis of inflation, in particular during the 1970s, was one primarily of Central Bank failure to control money supply growth and thereby resulting in nominal spending growth exceeding the productive potential growth of the US economy. This attribution and the subsequent growth in popularity led to monetarism influencing world leaders such as Ronald Reagan and Margaret Thatcher during the 1980s, before falling out of favour with economists due to the rise of empirical evidence against one of its key assumptions.

Following the shortfalls of Keynesianism in addressing the shortfalls of the West during the 1970s, the New Keynesian consensus arose to combine both the Keynesian and Neoclassical schools of thought. Rational expectations, price stickiness and imperfect markets are part of its key tenants, as is the focus on monetary policy in influencing private sector activity.

The Keynesian economic ideology that dominated academia throughout the 1930s until the 1970s birthed out of the perceived failures of classical economics during the Great Depression. A belief in government intervention in resolving market failures through measures such as price controls and nationalisation as part of this Keynesian thought contributed to the gradual relative decline of both the UK and the US compared to the likes of Germany and Japan, the latter of which pursued supply-side policies in their rapid rise to one of the wealthiest countries in the world.

A Land Value Tax has been adopted in economies such as Singapore and in some states in the United States, producing positive results that promote allocative efficiency gains and social benefits. We explore the effectiveness of LVT's and how they are preferable to alternative forms of taxation, such as taxes on income and profits.

Neoliberalism. The economic ideology that has dominated since the 1980s is slowly witnessing its demise. Beginning with a misguided blame for the Great Recession and Financial Crisis of 2008, populist leaders across the West have capitalised on the anti-neoliberal establishment, reversing the tide of liberal immigration and free trade laws that were a staple of the neoliberal revolution.

The Spanish Economy suffered during the 1980s and early 90s while neighbouring Western economies experienced strong economic growth. After instituting neoliberal reforms during the late 1990s, the Spanish economy began to prosper experiencing record falls in unemployment. However, the Great Recession and the subsequent Eurozone crisis hampered this, putting the Spanish economy on a path to stagnation.

The Reagan Revolution coincided with the institute of the neoliberal economic framework that has dominated global markets since. The rise of the neoliberalism began in the 1930s, before escalating in the 1960s and 70s amidst stagflation and dissatisfaction with the New Deal-era status-quo.

The US economy remains in a strong position. Disinflation is bringing inflation closer to its 2% target, while a strong market ensures that the US economy operates close to its productive potential.

Italy's economy has consistently lagged behind its Western peers for decades. An inefficient tax system, rampant corruption and excessive government spending are large contributors to this stagnation, leaving Italy with structurally high unemployment and poor productive potential growth as a result.

China's economic platform radically shifted during the 1980s and late 1990s. In tune with many Western nations, the then-Chinese leader Deng Xiaoping took to sweeping market liberalising policies, promoting entrepreneurship and paving the way for China to become the second largest economy in the world.

With the NHS is on the brink of collapse, grappling with record waiting times and striking nurses, politicians fail to recognise the multitude of better alternative healthcare systems that exist. Korean & German models are exemplars, combining the benefits of private-care and public-funding to provide efficient healthcare for its citizens.

Singapore currently stands as one of the wealthiest countries in the world. Prudent fiscal policy, maintaining low taxes on income and productive behaviour, coupled with a limited welfare system that provides incentives to work as a pose to handouts that create dependency.

Central Bank credibility is continually undermined by inflation targeting, comprising of both supply and demand-side inflation; the former of which is outside of their control. Nominal-GDP Level Targeting resolves this, focusing on stabilising the growth rate of spending in the economy - minimising fluctuations that destabilise the economy and result in recession. 

Germany stands as one of the largest economies in the world; blessed with a diversified economy comprised of a large industrial sector, Germany has proved resilient in times of global economic hardship, particularly during 2008. With this said, Germany suffered relative to its European counterparts in the 1990s. The economic miracle and recovery began in the early-2000s with labour reforms that transformed Germany for the better.

The 'Austerity 2.0' budget was finally announced in Thursday's Autumn Statement, marking a rebirth of the fiscal tightening that defined the previous decade. Chancellor Jeremy Hunt, a key member of the Cameron-government, set out a series of proposals to fill the structural budget deficit. A failure to enact radical reforms to rescue the dire British economic outlooks marks  a return to the status-quo of the previous decade, continuing the trend of the managed economic decline in the UK.

The Mini Budget announced in late September led to the implosion of the Liz Truss administration that lasted only 44 days - the shortest tenure for a UK Prime Minister. The cuts to income and corporation tax, coupled with a lack of spending reductions, culminated in forecasts of rising debt-to-GDP in the medium to long term - shocking the markets and vindicating Truss' former leadership rival - Rishi Sunak.

Securing economic growth and rising living standards should be a primary goal of any government. Economic liberty: free markets, low regulatory burdens, a stable business environment, coalesces with said prosperity. 

The world's oldest and most successful political party has evolved over the past decade. Despite holding office for 12 years, the difference between today's Conservative party and the Cameron years is stark. A radical departure from the neoliberal agenda of lower taxes and lower welfare has formulated into an economically-left leaning, socially conservative party of higher military spending and tax hikes as a pose to spending cuts to balance the books. 

As the US midterms swiftly approach with the Republicans poised to take over both congressional houses, recalling the legacy of the previous Republican President draws attention to their potential plans. Aggressive populist rhetoric during Donald Trump's 2016 contest didn't translate into policy as he governed largely similar to his establishment predecessors. However, Trump's embracing of culture-war rhetoric did translate to protectionism - a radical departure from the neoliberal status-quo consensus that dominated from the 1980s.

To raise capital or debt. This is an important choice for businesses looking to expand and increase their output. Businesses are the backbone of any market economy, with IPOs comprising one method of raising equity. Given the plethora of choices, examining each is vital to understand the framework that would lead firms to favour one over the other.

Once the world's poorest economy per capita in the 1950s, South Korea has undergone an economic miracle to become one of the most developed economies. Similar path to its neighbours, Japan, Taiwan, Singapore and Hong Kong have all witnessed like successes. While these nations have differences over specific microeconomic policies, one economic model stands out: a stringent devotion to free-market capitalism. 

Promoting prosperity globally has been the goal of international institutions such as the IMF and World Bank for decades. Turning to foreign aid spending as a solution seemed logical: provide developing nations with financial capital needed to develop infrastructure and produce a skilled workforce. Unfortunately, well-intentions haven't produced outcomes. Foreign aid spending is a waste of money. For developing nations, a turn to free markets is the solution.

Welcome to Season 2 of Free Market Talk!

With spiraling inflation plaguing the globe in 2022, the mere thought of introducing negative interest rates could hardly appear more detached from reality. However, during the previous decade, several Central Banks took to this supposed 'radical policy' in an attempt to stimulate inflation and long-run economic growth. The results are less than sound. Unprecedented asset-price inflation, depriving younger generations of housing, has been one of the many unintended consequences of this disastrous policy.

Thank you for listening to the first season of Free Market Talk. We'll be back in September for Season 2!

Since 2008, alternative asset classes have proliferated and as such have grown in investor portfolios globally. Following unprecedented expansionary monetary policy measures by Central Banks globally, alternative assets, uncorrelated with equity and fixed income, have outperformed these two traditional asset classes. However in 2022, the unsettled economic climate makes their future uncertain. Will alternatives continue their growth?

The recent Australian election saw the departure of the Liberal-National Coalition, marking an election victory for the Labor Party for the first time since 2010. Aussie's have been unfortunate in recent years; following successful economic management amidst the Global Financial Crisis and Great Recession of 2008, growth has slowed dramatically. An over-dependence on energy has hurt the Land Down Under. Can Labor turn the economy around once more?

Households globally have begun to feel the squeeze on disposable incomes as spiralling inflation erodes savings and debt. Politicians and bureaucrats have blamed Putin for these inflationary pressures; truth be told, inflation had already been rapidly climbing before the February invasion of Ukraine.

Argentina's transition from an agricultural and mining exporter in the days of the Spanish empire to a Western, service-based economy has been turbulent. Plagued with numerous debt crises, stifling FDI and development, the land of the Gaucho has struggled since the neoliberal world order that began in the 1980s.