I'm always astonished by how a change that is not visible nor tangible and is over and above minimal can make the headlines. But it always works. This week, for example, in the New York Times: "Fed Makes Biggest Interest Rate Increase Since 2000 as High Inflation Persists." What had happened was neither more nor … Continue reading Why central banks?
Why the Slovak Minister of Economy is wrong
A friend of mine wanted to go dancing the other day. He didn't make it. After queuing at a club for quite a while, the bouncer turned him away. I never liked being part of such a crowd, lining up for the allowance to dance, being examined by someone who decides if I fit the … Continue reading Why don’t they let you in: How bouncers maximise dance club profits
At a press conference last November, as Vladimir Putin was massing troops along the border with Ukraine, he was asked what keeps him up at night. Putin answered that one of the main problems Russia faces today was its population decline and its threat to the country's economy. He added: "From a humanitarian point of view … Continue reading What determines a birth rate? – Or: The Russian population problem
Why the strong Russian currency serves Putin, not Russia
Every time the prices at the gas stations are way up, there is (at least here in Germany) the same discussion. That discussion goes along with the following question: Are the oil companies taking advantage of their customers, charging extra high prices to maximise their profits? The correct answer to this question is probably: Of … Continue reading The scapegoat problem: What’s missing in the gasoline price debate
Putin is demanding payment in rubles for its natural gas exports. However, the contracts are denominated in euros and dollars. One would think that Putin would benefit from a change towards the ruble (why else would he act that way). But that's not the case at all. Let's compare the two payment methods. Method 1 is the … Continue reading Little more than hot air: What will change if natural gas is paid in rubles
From our Western point of view, it is somewhat incomprehensible why the Russian president (probably) continues to have great support in his country. Putin oppresses his people, but the majority doesn't seem to mind. How can that be? A single chart provides an explanation. It shows purchasing power per person over time in Russia. At … Continue reading Why Putin is popular in Russia
Inflation is back. After many years of low inflation rates, prices have recently risen in much of the world. The chart below shows the inflation rate of the G20 countries compared to the same month a year ago (I took the chart from here). In this post, I would like to answer the following question: Is this rising inflation … Continue reading What’s the problem with rising prices?
There is reason to hope that there will be more democracy in the future.