What we’re reading (1/19)
“Global Leaders Gather In Switzerland To Ponder The Future Of A Messy World” (New York Times). “Topics of discussion at Davos — according to U.S. and European analysts and former policymakers interviewed ahead of the event — are likely to include Russia’s war with Ukraine; prospects for global trade and markets; the probability of China invading Taiwan; and the risks of a Middle East flare-up caused by the recent uprising in Iran.”
“The Risk Of Higher U.S. Inflation In 2026” (Peter Orszag, Adam Posen). “The consensus view among forecasters is that inflation will continue its gradual descent toward the Federal Reserve's 2 percent target through 2026. Similarly, market pricing suggests investors believe the Fed has largely won its inflation battle. In our view, however, this optimism is premature. We think it is more likely that inflation will surprise to the upside — potentially exceeding 4 percent by the end of 2026. The core drivers are the lagged effects of tariffs, an expansion in the fiscal deficit (which could exceed 7 percent of GDP this year), a tighter labor market reflecting the effects of the shift in immigration policy, monetary policy that is looser than commonly appreciated, and inflationary expectations that are drifting upwards. We believe these factors outweigh the downward‑pressure trends that consensus has been fixated on—namely, the ongoing decline in housing inflation and gains in productivity.”
“Even MBAs From Top Business Schools Are Struggling To Get Hired” (Wall Street Journal). “At Duke University’s Fuqua School of Business, for instance, 21% of job seekers were still looking for work three months after graduation last summer. About 15% of those at the University of Michigan’s Ross School of Business remained on the hunt. Those rates are similar to 2024 but sharply higher than 2019, when many employers couldn’t hire enough white-collar professionals. Just 5% of job-seeking M.B.A.s graduating from Duke then were still looking for work three months postgraduation. At Michigan that year, it was 4%.”
“UK Productivity Surge Signals Economic Turnaround, Study Finds” (Bloomberg). “Britain is seeing early signs of a long-awaited turnaround of its productivity woes, according to an alternative measure that suggests output per hour worked has risen at a pace not seen since before the financial crisis. The Resolution Foundation said a ‘blistering’ productivity surge has been masked by problems with official statistics and pointed to encouraging indications of a clearout of ‘zombie’ firms that contribute little to the economy.”
“Why London’s Chimney Sweeps Are Enjoying A Resurgence” (New York Times). “The mass adoption of central heating in the second half of the 20th century, and the introduction of clean air regulations, meant open fires fell out of fashion and the industry shrank. But some firms survived. Now, many sweeps, including those in the Firkins family business, say the trade has been experiencing an improbable resurgence. According to the National Association of Chimney Sweeps, demand has been bolstered by high energy prices, the popularity of wood-burning stoves and an international climate that has prompted warnings that electricity supplies could be vulnerable to attack by hostile states like Russia.”
