Capital Controls- Here We Come

As expected (see Release the Kraken: Free capital flows will transmit Chinese economic woes fast), and reported in today’s US print edition of the Wall Street Journal, some emerging markets are invoking capital controls to help prevent their currency leaving. The article, Curbs on Outflows Increase, explains that several countries were slapping taxes on certain transactions that resulted in currency movements.  
Certainly these are not large or developed economies but it is a sign of a growing problem. And larger economies may in time respond in kind with their own actions should they anticipate unfair restrictions. It is just a matter of time. Global trade, already down, will take another hit. The very work that would help create growth, is being strangled. That’s just great.

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One thought on “Capital Controls- Here We Come

  1. Pingback: The Fed’s Bark is Loud; the PBOC’s Bite will be much Worse | andrewgwhitedotcom

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