June 29, 2015

A Perfect Storm Brewing for American Manufacturing -- Greek Crisis and Fed Interest Rate Liftoff

Greece has just announced the closure of its banks and stock market for a week. With falling unemployment, rising wages and improved economic prospects, the Federal Reserve is likely to start raising interest rates this year. Together, these developments are a perfect storm brewing  that could derail the hesitant recovery of America's manufacturing sector, push external trade deficits even higher, and throw large numbers of Americans out of work.  Why?

June 23, 2015

Currency-Based CVD Penalties: Wrong Tool for Solving America's Trade Deficits

The currently proposed legislation that would use currency-based countervailing duty surcharges to help reduce America's trade and unemployment problems will have almost no impact because CVDs are designed to fix firm-level, product-specific problems, not macro-economic imbalances. The note concludes that a macro-level policy designed to correct the dollar's global overvaluation is needed instead.