What we’re reading (4/9)
“Will Fighting Inflation In America Cause A Debt Crisis Abroad?” (Foreign Affairs). “[W]hatever the impact, rising interest rates will not just affect the United States. Higher U.S. rates raise the cost of borrowing in U.S. dollars on international markets. They also increase demand for U.S. dollar assets relative to assets in other currencies, and they can therefore cause those currencies to fall in value. For countries where external debt is denominated in U.S. dollars, debt repayment will become more expensive.”
“German Industry Prepares For Worst-Case Scenario” (Der Spiegel). “Germany is extremely ill-prepared for this worst-case scenario. A ‘Gas Emergency Plan for the Republic of Germany’ has been in place since September 2019. But it is based on a fundamental miscalculation: In the very first pages, it states that the natural gas supply situation in Germany is ‘highly secure and reliable.’ And that the likelihood of a massive supply crisis is ‘very low.’”
“Warren Buffett’s Protégé Is Building A Mini Berkshire” (Wall Street Journal). “Tracy Britt Cool spent a decade working for Warren Buffett. She now wants to buy the kinds of companies that might have interested the famed investor 30 or 40 years ago. Those are businesses typically run by founders or family owners that have solid performance and competitive “moats”—a favorite term of Mr. Buffett’s—yet aren’t big enough to draw Berkshire Hathaway Inc.’s attention today.”
“In This Part Of The U.S. Bond Market, 0% Is High And Alarming” (Bloomberg). “While all Treasury yields have climbed this year as the Fed began what’s expected to be an aggressive series of rate increases aimed throttling high inflation, in the past two weeks the baton has been passed to inflation-protected notes and bonds. Their yields are termed ‘real’ because they represent the rates investors will accept as long as they are paired with extra payments to offset inflation.”
“‘This Shouldn’t Happen’: Inside the Virus-Hunting Nonprofit At The Center Of The Lab-Leak Controversy” (Vanity Fair). “Chasing scientific renown, grant dollars, and approval from Dr. Anthony Fauci, Peter Daszak transformed the environmental nonprofit EcoHealth Alliance into a government-funded sponsor of risky, cutting-edge virus research in both the U.S. and Wuhan, China. Drawing on more than 100,000 leaked documents, a V.F. investigation shows how an organization dedicated to preventing the next pandemic found itself suspected of helping start one.”
