Comment, analysis and other offerings from Tuesday’s FT,
Why the Fed should be given more powers
Roger Altman, chairman of Evercore Partners, writes that motivations for opposing a wider Fed role are all over the place. Some argue that it failed to fulfil its prior regulatory obligations in this crisis and that a new regulator is needed. Others see additional powers leading to more bail-outs such as Citigroup’s.
Magic and the myth of the rational market
Keir Martin, a lecturer in social anthropology at Manchester University, writes that critics of untrammelled free markets have long attacked the assumption that markets are rational, driven by rational self-interested economic actors. But the question of economic rationality has returned with a vengeance in the wake of the current crisis.
Editorial Comment: World recovery is not yet in the bag
First, there are problems weighing on demand everywhere. Unemployment will continue to climb for some time globally. And, at the same time, the world banking system remains undercapitalised: credit will remain tight, restricting finance to consumers and businesses.
Lex on ten years of Putinomics
Phase one of the original Putin Plan was implemented with some success. The post-Soviet decline in oil production was reversed — in time for the fortuitous upward spiral in world prices. The problem is phase two.
Insight: Do not fear falling bond prices
George Magnus, senior economic adviser, UBS Investment Bank, writes that the purple patch for financial markets has rolled on almost without interruption since early March, but asks is the tint about to change towards a more “reddish” colour?
Lombard: Grad trainees: irritating, untested and indispensable
Graduate trainees irritate the old corporate hands and incense those who believe the modern marketplace undervalues experience, or, through mass redundancies, actually punishes it. By definition, they need training, which takes time and money. And the returns on that investment often accrue to rivals if the grads jump ship.
The short view on mining
The FT’s commodities correspondent Javier Blas on how the drop in global prices earlier this year revealed that China can only sustain high domestic production when global prices are near record highs.