UK Markets Thrown Into Turmoil Once Again

Musk denied Bremmer’s account. “I have spoken to Putin only once and that was about 18 months ago. The subject matter was space,” he tweeted.

Bremmer denied Musk’s denial. “elon musk told me he had spoken with putin and the kremlin directly about ukraine. he also told me what the kremlin’s red lines were,” Bremmer tweeted.

Does it matter? Yes, Bremmer argued in his newsletter, where he also eschews capital letters: “given that elon musk now looks increasingly likely to buy twitter, at which point he’ll reinstate the former president, you’ll have those same views with trump and his full political base behind it, potentially leading the united states to become fundamentally divided on the issue.” Musk in his last tweet on the matter was a little more personal: “Nobody should trust Bremmer.”

Blaming the Fed

Top economic officials are gathering this week in Washington for the annual meetings of the International Monetary Fund and World Bank. Atop the agenda: How to bring down inflation and revive a slowing global economy to ensure the turmoil doesn’t mushroom into the next global financial crisis.

Look for central banks, and specifically the Fed, to get some of the blame for economic volatility, which has spilled into the financial markets. Yesterday, economists at the I.M.F. said in its World Economic Outlook report that the Fed’s aggressive efforts to crush domestic inflation, primarily by rapidly raising interest rates, had turbocharged the dollar’s value, increasing the odds of an international debt crisis. That follows a United Nations agency warning that the Fed’s interest rate policy would ultimately deprive developing nations of $360 billion in “future income,” and “signal more trouble ahead.” Josep Borrell, a foreign policy chief for the E.U., was just as blunt, saying U.S. monetary policy risks creating “a world recession.”

With criticism mounting, Vincent Reinhart, a former top Fed economist who is now at Dreyfus and Mellon, said “it’s very possible that the view that it’s all the Fed’s fault could emerge as the consensus by Friday.”

Article source: https://www.nytimes.com/2022/10/12/business/dealbook/britain-markets-turmoil-gilts-pound-andrew-bailey.html