The Low Interest Rates: a Legacy of the Financial Crisis or the Result of Something Else?

The 2008 Global Financial Crisis has come and gone. Since then, worldwide interest rates remain at an all-time low, yet economic growth remains sluggish. Theories have been put forward to explain the phenomena, two of which take a secular perspective, detached from the recent crisis. This paper employs an explorative style of examining two historical datasets with the staging point of the real interest rate levels, making it one of the more extensive overlooks of the real rate in both time and amount of countries. This paper finds that while the current period of low interest rates is neither exceptional in terms of length or severity, it stands unique in some regards. Notably, past episodes of low real interest rates have almost always coincided with significant increases in the rate of inflation, while the current bout of low real rates is occurring amidst lower than average rates of inflation. Even so, in many countries investment has weakened, savings has increased and policy rates were lowered to their limits since the crisis, all of which would contribute to lower real interest rates even in the absence of inflation

Has Abe boosted Japanese confidence enough to get out of stagnation? An early evaluation of Abenomics

The Japanese economy has since the beginning of the 1990’s suffered from a prolonged period of economic stagnation. Known as the Lost Decade, but extending its influence well into the 2000’s and beyond, many attempts has been made to reverse the stagnation. The latest of these has come to be known as Abenomics and is headed by incumbent Prime Minister Shinzō Abe. In this essay we investigate whether the economic policies under Abenomics have boosted economic confidence in Japan enough to reverse the stagnation. Our findings support that Abenomics have had strong effects on both consumer confidence as well as business confidence. Both types of confidence rose sharply in response to its policies and were accompanied by sizeable increases in both consumption as well as investment, contributing to increased growth in GDP and improvement in unemployment. Deflation has been reversed into a positive rate of inflation for the first time in decades. While it is too early to definitely say whether or not Abenomics is the cure needed to end the Japanese economic stagnation, the preliminary outlook is very promising

Sydkorea under två kriser - vad lärde man sig av krisen 1997 inför krisen 2008?

This paper examines the macroeconomic policy management in South Korea during the Asian and global financial crises from a policy learning perspective. We argue that the lessons Korean officials drew from the Asian crisis were primarily negative, reflecting the harsh outcome of this crisis, and included economic restructuring as well as active crisis management adjustments. These restructurings have led to a more balanced liberalization of the Korean economy combined with better supervision on both financial and corporate markets. One of the major differences in active crisis management during the two crises pertains to use of monetary policy as a result of learning between the two. During the latter crisis Korean officials chose not to intervene on the exchange market and instead fully employed monetary policy to ease recession, in stark contrast to the contractive polices under IMF guidance during the Asian crisis

Global scaling of the heat transport in fusion plasmas

A global heat flux model based on a fractional derivative of plasma pressure is proposed for the heat transport in fusion plasmas. The degree of the fractional derivative of the heat flux, α, is defined through the power balance analysis of the steady state. The model was used to obtain the experimental values of α for a large database of the Joint European Torus (JET) carbon-wall as well as ITER like-wall plasmas. The fractional degrees of the electron heat flux are found to be α<2, for all the selected pulses in the database, suggesting a deviation from the diffusive paradigm. Moreover, the results show that as the volume integrated input power is increased, the fractional degree of the electron heat flux converges to α∼0.8, indicating a global scaling between the net heating and the pressure profile in the high-power JET plasmas. The model is expected to provide insight into the proper kinetic description for the fusion plasmas and improve the accuracy of the heat transport predictions