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The Pitfalls of Forecasting Foreign Policy

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My new analysis on PRA Right Web:


The Pitfalls of Forecasting Foreign Policy
By Leon Hadar | March 13, 2008


PRA Right Web

After close to eight years during which the relationship between the United States and much of the international community has been dominated by tensions over foreign policy, many wonder what a new administration will hold. Some hope there will be a new U.S. approach to the rest of the world—especially to the Middle East—that will be a dramatic foreign policy U-turn. Others hope for a president who maintains similar versions of current policies.

It is powerfully tempting to try to predict U.S. foreign policy under this or that president by means of deconstructing his or her statements and campaign speeches; in election months, such predictions flow nonstop from the news media and pundits. But such an exercise is likely to produce misleading, unreliable conclusions, and a look at history and the candidates’ backgrounds suggests that predicting future policy is anythi…

Will liquidity boost worsen US debt woes?

Business Times - 14 Mar 2008


Will liquidity boost worsen US debt woes?

The Fed's latest bailout may create a moral danger by giving investors and consumers incentive to keep irresponsible habits

By LEON HADAR
WASHINGTON CORRESPONDENT

A FEW financial pundits speculated half-jokingly that the Dow's rise by 417.66 points earlier this week reflected the sense of relief among investors over the impending resignation of New York Governor Eliot Spitzer aka 'Wall Street's Sheriff,' who as a crusading former attorney-general had prosecuted many white-collar criminals in the financial community.

But in fact, the boost to the stock market, reflected in Dow's biggest one-day point gain since July 2002, came as a response to the surprising offer by the US Federal Reserve - coordinated with other central banks - to offer to lend through a 28-day-long auction up to US$200 billion of highly liquid Treasury securities to America's biggest banks and investment houses.

These f…