Dr Ivanovitch - MSI Global
Dr. Michael Ivanovitch is an independent analyst focusing on world economy, geopolitics and investment strategy. He served as a senior economist at the OECD in Paris, international economist at the Federal Reserve Bank of New York and taught economics at Columbia Business School. 
Daily updates on world economy
Rising U.S. inflation is a threat to economic growth
China’s huge and growing domestic market drives the economy
The euro area survives on easy money and not much else
Flattening U.S. yield curve does not reflect rising inflation

Recent Essays

The Euro Area Inflation Is Driven by Bad Energy Policies

The first official estimate indicates that consumer prices in the 19 countries of the European monetary union rose last September at an annual rate of 3.4% -- marking a strong acceleration from minus 0.3% during the same month of 2020. Excluding energy prices, the inflation was a relatively tame 1.9%, given the fact that this […]

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Focus on U.S. Economy; Leave the EU, Russia and China Alone

Bill Clinton got us into African, Balkan and East European quagmires, and Bush (W) finished it off with unwinnable Iraq and Afghanistan military adventures. Obama continued to struggle with that difficult legacy -- adding a Libya civil war of his own -- before experiencing an epiphany and telling the nation about it on June 22, […]

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“Love Thy Neighbor” Is a Solution to Sino-Indian Security Tensions

After a violent clash in Himalaya’s Galwan Valley between Indian and Chinese border patrols in June 2020, large parts of India’s business community decided to boycott trading with China. In spite of that, China last year displaced the U.S. as India’s largest trade partner. India’s bilateral trade with China increased 5.5% to $86.4 billion, while […]

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The EU Wants No Trade War with China

With a bilateral trade volume of €586 billion, China last year edged out the U.S. to become the EU’s largest trade partner. That trend was significantly amplified in the first seven months of this year. During that period, the EU trade with China was running 7% ahead of its trade business with the U.S. The […]

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The Euro Area Can Return to a Stable Economic Growth Path

A strong recovery from the monetary union’s deep recession in the middle of last year has generated very little price inflation in labor and product markets. That now makes it possible to withdraw an exceptionally large monetary stimulus without compromising a gradual return to growth rates that are compatible with the economy’s long-term noninflationary potential. […]

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Can China Square Its East Asian Circles?

Japan is a big disappointment for China. In spite of incredible atrocities and material destructions Japan committed during its war with China between 1931 and 1945, Beijing accepted to talk about peace, friendship, trade and investments with its eastern neighbor in late 1970s. Over the following four decades, China became Japan’s most important export market […]

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Economics Are Writing a New Page of Pax Americana

The idea that the U.S. is withdrawing from the world and abandoning its key foreign policy objectives is manifestly false. Anybody capable of reading mainstream media can see that every day. There is a change, though. Gripped by binding fiscal and monetary constraints, the U.S. is just looking for more affordable, and – hopefully – […]

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Allies Will Take the U.S. Trade Income, But They Won’t Follow the U.S. to Confront China

Continuing a long tradition of driving the global business cycle, America gave 1.6% of its domestic demand during the first half of this year to support economic activity in the rest of the world. America continued to buy more goods and services than it sells to its global trade partners. That is called a trade […]

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The Dollar Will Remain the World’s Key Currency for the Foreseeable Future

Legions of greenback naysayers go back a long way. In the immediate post-WWII years, the Europeans were bitterly complaining that chronic dollar shortages (sic) were sapping the recovery of their war-ravaged economies. And when Washington moved to help with more liberal provisions of dollar liquidity, the French began adding up Uncle Sam’s debts to show […]

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The EU’s Economic Outlook Looks Good, If Politics Can Be Kept Out of the Way

A very strong 13% rebound of EU’s economic activity in the second quarter, after a 3% decline during the previous three quarters, is mainly the result of more relaxed sanitary limitations and a powerful support of an easy monetary policy. That surprisingly fast and vigorous response reflects a forward momentum in the four largest economies […]

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East Asia Is a Sound Pillar of World Economy

“The West messed up East Asia …” To this day, many economists and people from the political elite in that region believe that’s what the West (read the U.S.) did during the Asian financial crisis in late 1990s, without providing any proof or reason for such a colossal mischief. Many years later, I had to […]

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China Leaders Solicit Nonpartisan Economic Advice

“To be rich is glorious,” is a simple summary of dialectic materialism offered by China’s Paramount Leader Deng Xioping to a relentlessly prodding Mike Wallace during the CBS News “60 Minutes” interview in September 1986. Looking at his puzzled interviewer, Deng went on to amplify on his mirabile dictu by saying that “there is no […]

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Only a Recession Can Kill Accelerating Inflation

The U.S. Federal Reserve (the Fed) is misleading the public with statements that sharply accelerating price increases (aka price inflation) in the American economy are due to temporary and reversible external shocks. The subtext here is that this undeclared form of taxation is not caused by serious errors of the Fed’s monetary policy. Don’t believe […]

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What Can the U.S. Expect from a Quest for Stronger German Ties?

Washington’s recent efforts to restore and invigorate close relations with Germany are an important part of a new architecture of Western world order. Accounting for one-fourth of the EU economy, and for nearly a third of the trans-Atlantic trade flows, Germany is an economic powerhouse that sets the pace to demand, output and employment in […]

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China’s Most Difficult Phase of Economic Reforms

Systemic financial market changes in Western economies during the 1980s were routinely called “Big-Bang reforms.” That long, and still unfolding, process started in London and continued, in a much more radical fashion, in Paris, Frankfurt, Madrid, and many other European capitals to make possible the EU’s single market and the introduction of the common legal […]

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