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important to appreciate, I think, because if one believed that the direction of
causality is the opposite, that Trump causes other changes that would have
been avoidable if Ms Clinton had won, one would come up with the wrong
conclusions on what to do to stop the global shift in sentiment. (2) The
Economist had a special edition last week on the rising nationalism in the
developed West, as if it’s an unfounded, random and sinister event that
needs to be suppressed by all means necessary. For various reasons, the
political left is in decline in the developed West. Look at the UK’s Labour
Party and the US’ Democratic Party. In France, only 1 out of 20 people
approves of Hollande’s performance. (3) The Presidential race in France is
now between the Centre Right (Mr Fillon from the Republican Party) and
the Far Right (Ms Le Pen from National Front). The pendulum in Europe, in
my view, will swing to the right, and possibly overshoot, as pendulums tend
to do… which is not good, but an unavoidable consequence of the pendulum
having overshot to the left in the past… In any case, with the Republican
primary being out of the way, the campaign will start in earnest, with the
first round of the Presidential elections to take place in April and the second
round in May. FWIW, Mr Fillon looks like a stronger candidate than Mr
Sarkozy to challenge Ms Le Pen. France, under Mr Fillon, could very well
enter a period of economic reform and rejuvenation, I am guessing. In short,
Mr Fillon’s victory last weekend could be a major positive for France, I
think.

The trouble with macroeconomics. The rebellion against the establishment
has also begun in the nerdy field of macro economics, led in part by Prof
Paul Romer of the Stern School of Business. He, of course, has made
enemies in the field with his view – a view I share: ‘For more than three
decades, macroeconomics has gone backwards. The treatment of
identification now is no more credible than in the early 1970s but escapes
challenge because it is so much more opaque. Macroeconomic theorists
dismiss mere facts by feigning an obtuse ignorance about such simple
assertions as "tight monetary policy can cause a recession." Their models
attribute fluctuations in aggregate variables to imaginary causal forces that
are not influenced by the action that any person takes. A parallel with string
theory from physics hints at a general failure mode of science that is
triggered when respect for highly regarded leaders evolves into a deference
to authority that displaces objective fact from its position as the ultimate
determinant of scientific truth.’ Group think has become a serious
impediment to advances and renewals in this important field. Misguided
policies have also had significant consequences for people’s lives around the
world.

Trade globalization. There will likely be a shift from unconditional,
uncontrolled, and unmanaged trade globalisation, i.e. ‘free trade’, to ‘fair
trade,’. Trade globalisation of the type that we have just experienced

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