Erik Lueth

Global Emerging Market Economist

Erik is your typical EM aficionado. He has worked for the IMF, lived several years in Hong Kong and has an Indian wife. His motto: Get the bigger picture.

Posts by Erik Lueth

Economics

China hard landing risk - What can we learn from Japan?

This is the fourth and last in a series of blogs that looks at the risk of a hard landing in the Chinese economy. One problem when assessing this risk is the lack of historical precedents. Very few countries underwent debt build-ups of Chinese proportions, and those that did were usually very small, open economies. The one exception is 1990 Japan which displays some striking similarities with today’s China.

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Economics

Bubble trouble in China? Of houses and hard landings

This is the third in a series of blogs that looks at the risks of a Chinese hard landing. In the first we argued that China still has important defences in the form of fiscal space. In the second, we discussed why the odds of financial crisis are not that high. In this blog, we ask whether China sits on a property bubble, which tend to end in violent and drawn-out recessions.

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Economics

This time it’s different – the odds of financial crisis in China

History is littered with episodes where the rules of economics were declared dead, only for these rules to return with a vengeance. You remember the ‘end of the business cycle’ debate in the late 90s or the ‘great moderation’ paradigm of the early 00s? Despite these precedents and despite overwhelming evidence that large debt build-ups can end in tears, we believe a Chinese financial crisis is not that likely over the next 2-3 years.

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Economics

Leviathan to the rescue—gauging China’s fiscal space

Just as Hobbes’ Leviathan saves the people from the horrors of constant struggle and chaos, we ask whether the Chinese state can save the people from a hard landing.

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Economics

Three myths about China’s growth slowdown

We are fast approaching the Chinese leadership reshuffle in late 2017. Attention could turn from the current period of relative calm and stability to the medium-term challenges lying ahead. In this context, we are likely to encounter three myths about China’s growth slowdown.

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Economics

Are Mexico’s fortunes finally turning?

Mexico's economy has faced no shortage of headwinds over the past few years. As a manufacturing hub, it suffered more than others from the post-2008 weakness in the global cycle. It was hit hard by the collapse in oil prices in 2014. And in 2016, it became a key target of President Trump’s campaign against trade and outsourcing. However, there are signs that the headwinds facing Mexico's economies could now be abating.

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Economics

Another dispassionate look at India

They say that idealists don’t care about the short run, while cynics don’t care about the long run. We like to think of ourselves as realists who believe that what you do in the short run determines the long run. This is how we look at India.

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