October 24, 2016

Are Fund Managers Doomed? Making the Case for Passive Investing’s Triumph

Source: The Wall Street Journal

QE: The Story So Far

In the past decade or so, a number of central banks have purchased assets financed by the creation of central bank reserves as a tool for loosening monetary policy – a policy often known as ‘quantitative easing’ or ‘QE’. The first half of the paper reviews the international evidence on the impact on financial markets and economic activity of this policy. It finds that these central bank balance sheet expansions had a discernible and significant impact on financial markets and the economy. The second half of the paper provides new empirical analysis on the macroeconomic impact of central bank balance sheet expansions, across time and countries. It finds three key results. First, it is only when central bank balance sheet expansions are used as a monetary policy tool that they have a significant macro-economic impact. Second, there is evidence for the US that the effectiveness of QE may vary over time, depending on the state of the economy and liquidity of the financial system. And third, QE can have strong spill-over effects cross-border, acting mainly via financial channels. For example, the impact of US QE on UK economic activity may be as large as the impact on US economic activity.

swp624 by TBP_Think_Tank on Scribd

How Weed Laws Are Failing the UK: High Society

Cannabis is the UK’s favourite illegal drug. An estimated half a million people use it for medicinal purposes, and many more just to get high. But while countries around the world move to decriminalise or even fully legalise smoking and growing weed – and in the face of British police de-prioritising the policing of cannabis – the UK’s government refuses to budge. When over 200,000 people signed a petition last year calling on Westminster to make the production, sale and use of weed legal, the government responded with a flat-out no.

In this episode of High Society we explore how that approach to the issue shapes the UK’s weed culture, meeting growers, medical users, politicians and a couple of thieves in Birmingham who have come up with a novel way to make money off the country’s cannabis trade.