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21 sats \ 1 reply \ @xz 20 Feb 2024 \ parent \ on: China Takes Preemptive Measures to Combat Deflation econ
Not sure I understand the ramifications of macro spillover, or as it used to be put, catching a cold and the world sneezing. But if I can believe the FR knows what it's talking about.
".. expansionary shocks to China’s credit lead to a decline in aggregate risk aversion, associated with a lower VIX, which elevates global asset prices and credit"
https://www.federalreserve.gov/econres/ifdp/files/ifdp1360.pdf [6/59]
Guessing this means that on the flip this would telegraph the opposite but then again we see a frequent about turn of interest rate policy.
I agree it's all about avoiding domestic discontent.
you've described it quite well. basically, i have to say that i'm not a particularly big fan of macroeconomics. i tend to prefer microeconomic analysis, which has something to do with my background as a student. there's always a lot of hype about macro
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