Economy, decoded
Bank capital: what really limits how much banks can lend
Beijing is borrowing 300 billion yuan to lift the core capital of eight state-owned financial institutions. The press reports the amount injected. The number that matters sits elsewhere: one yuan of capital allows more than nine yuan of risk-weighted assets. What limits a bank is not the money it holds, but the money it owns.
30-year yields: Japan pays 4% while its policy rate is 1%
Japan has just borrowed for thirty years above 4%, while its central bank holds its policy rate at 1%. The gap between the two shows who really sets long-term rates, and why that question decides the cost of every long-dated loan.
Behavioral economics: biases, nudges and their real limits
You never chose how much you save each month: someone chose for you, and you agreed by doing nothing. Behavioral economics measured that gap between intention and action, then turned it into a governing tool adopted in more than fifty countries. Field data later forced a severe correction that almost nobody noticed, and it changes how published findings should be read.
Fiscal Policy Explained: Spending, Deficits, Multipliers
Governments have never paid so much interest: close to 3 percent of world GDP, against 2 percent four years ago. Yet the budget debate is still framed as a choice between spending more and spending less. Understanding fiscal policy means understanding why the same unit spent has twice the effect in a recession, and why global public debt would cross 100 percent of GDP as early as 2029.
Yuan clearing: Deutsche Bank lands Europe’s first mandate
China’s central bank has just handed Deutsche Bank the job of clearing the yuan in Frankfurt, the first European bank to hold that licence. Behind that technical decision sits a simple question: why a currency backed by the world’s second-largest economy still accounts for only 3.10% of global payments.
The foreign exchange market: how currency prices are set
Every day, $9.6 trillion changes hands on the largest and quietest market on earth, one with no exchange floor and no opening bell. In the first half of 2025 the dollar posted its worst half-year since 1973, yet its dominance grew. How can a currency lose value and gain influence at once? This Fundamental explains how the price of a currency is truly set.
The labor market: unemployment, flexibility, automation
Global unemployment has never been lower: 4.9% in 2025. Yet more than 400 million people would like to work and cannot, and every month millions of jobs vanish while others are born. Behind a single number lies a mechanism in constant motion, one that automation and artificial intelligence promise to upend. Understanding the labor market means learning to read what the unemployment rate does not say.
Money creation: how banks conjure the world's money supply
Most people believe banks lend out the savings customers deposit with them. The truth is stranger: every loan a bank grants creates brand-new money that did not exist a moment earlier, through a simple accounting entry. If banks can conjure money from nothing, what actually stops them, and why does this invisible power make the entire financial system as fragile as a rumour?
Red Sea shipping: one email reroutes global oil tankers
Supertankers loaded in Saudi Arabia turned around after a single ban email from Yemen's Houthis. The episode shows that a trade route is not fixed infrastructure but a running risk calculation, one where insurers and shipowners can redraw the flows feeding world economies within hours.
CXMT’s IPO: why a 470% first-day surge isn’t free money
Chinese memory chipmaker CXMT saw its share price jump nearly 470% on its Shanghai debut, after the largest capital raising in Asia this year. Behind the spectacular number lies a core market mechanism: the price set in an initial public offering is not yet a market price.
Fed rate hike: markets triple the odds as oil tops $100
In one week, the market-implied probability of a Federal Reserve rate hike on July 29 jumped from 10.7% to 34.7%. Behind the reversal lies a precise chain: oil above $100 a barrel feeds inflation, and inflation commands monetary policy.
Oil back above $100: anatomy of a worldwide supply shock
In three weeks, Brent crude climbed from 78 to more than 100 dollars a barrel before easing back toward 97. Drone strikes on the Black Sea, tanker attacks in the Red Sea, tensions around Hormuz: disruptions are stacking up. Behind the spike lies a precise mechanism: a market stripped of its shock absorbers facing demand that cannot adjust.
AI stocks: the market reversal that revives bubble fears
After a 130% rally in a year, the semiconductor index plunges and money flees into other sectors. This is not just a market accident: it is the recurring mechanism by which an over-concentrated investment story always ends up reversing, often violently.
AI chip boom: TSMC reveals the scale of the capex surge
The company that makes almost every advanced AI chip just posted a 67.9% jump in June sales. Behind that number sits a cycle mechanism few readers can name.
Sydney falls, rents soar: Australia’s market splits
For the first time in the current cycle, home values are falling in Sydney and Melbourne, even as rents rise 5.9% nationally. Rates back at 4.35%, a tax shake-up for landlords, and a record low in consumer confidence: three forces behind a housing market that’s splitting in two.
Public debt hit $100T. Why it never stops
Global public debt has passed 100 trillion dollars. Some economists call it a slow-motion crisis. Others say it is perfectly manageable. Both can be right, because debt sustainability depends on factors most people never check. How sovereign borrowing really works, and what makes a debt level dangerous or not.
US debt interest now tops the entire defense budget
For the first time since the 1990s, US net interest payments on the federal debt exceed the entire national defense budget: $952 billion versus $886 billion. On May 16, 2025, Moody’s stripped the US of its triple-A, the last of the three major rating agencies to do so. A signal markets already knew. A mechanism most people have never seen explained.
US tariffs struck down: global trade awaits a judge
In 78 days, two US tariff programs were struck down in court. This is not just a legal dispute: it signals that global value chains are now operating without stable ground rules, and every link in the chain is absorbing the cost.
International trade and global value chains
Your smartphone was designed in the United States, built with components from Taiwan and South Korea, assembled in China, and shipped across three continents before reaching your hands. That journey is not an exception, it is how the modern economy works. Understanding global value chains, the return of protectionism, and the reshaping of supply chains is now essential for anyone trying to make sense of prices, jobs, and geopolitics.
The Fed’s new chair won by the narrowest vote ever
54–45: the narrowest confirmation vote in Federal Reserve history.
When a president tries to fire the Fed chair
On April 15, Donald Trump threatened to fire Federal Reserve Chair Jerome Powell if he doesn’t leave his post by May 15.
Cryptocurrencies and digital assets: the basics
Bitcoin passed $100,000. Entire economies have adopted it as legal tender. Regulators worldwide are still trying to catch up. Before forming an opinion, it helps to understand what blockchain actually does, why crypto behaves the way it does, and what distinguishes a serious asset class from speculation.
Economic growth: sources, drivers and limits
GDP has multiplied by more than tenfold in advanced economies since 1950. Yet forecasters now expect the next decades to look nothing like the last. What actually drives growth, why it slows, and whether the historical model can still hold, the foundational concepts behind every economic outlook.
Economic inequalities: measurement and evolution
The richest 1% now hold more wealth than the bottom 50% combined. But that figure alone tells you less than you’d think, what matters is understanding how inequality is measured, why different metrics yield different conclusions, and what the data actually shows about its evolution over time.
Real estate: bubbles, investment and housing policy
Real estate is the world’s largest asset class, and one of the least understood. Price-to-income ratios, cap rates, bubble dynamics, rent control, zoning: the concepts that explain why housing markets behave the way they do, in any country, at any point in the cycle.
Financial markets: how stocks, bonds and prices work
Stocks, bonds, derivatives, indices, market makers, liquidity, financial markets have their own language, their own rules, and their own logic. A structured breakdown of how they’re organized, who the key players are, and what actually moves prices, beyond the headlines.
Economic cycles: recession, expansion and bubbles
Economies don’t grow in straight lines. They expand, overheat, contract, and recover, in patterns that repeat, even if the triggers vary. How to read economic cycles, what the leading indicators actually signal, and why understanding this rhythm changes how you interpret almost any piece of financial news.
Interest rates: how monetary policy moves the economy
When central banks move their key rate by a quarter of a point, mortgage costs shift, currencies fluctuate, and stock markets reprice, sometimes within minutes. Understanding why that happens is the starting point for reading any major economic event of the past two decades.
Inflation: mechanisms, causes and consequences
Prices rise, savings shrink, central banks react. Here is how the mechanism reaches you, and how to read it.