Interest rates
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.
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.
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.
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?
Corporate bankruptcy: liquidation versus restructuring
Most headline bankruptcies do not kill the company: they repair it. Behind a single word hide three opposite fates, liquidation, restructuring and prevention, and a quiet battle over who bears the losses. The rules decide, country by country, how much each creditor truly recovers. Understand this mechanism, and you can decode the most intense wave of business failures since 2013.
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.
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.
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.
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.