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Is there anyone more bland, more powerful, and less recognizable than Federal Reserve Chair Jerome Powell? He makes money moves more than Cardi B, and yet most people wouldn’t recognize him if he were sitting on their lap in the subway.

Why do relatively obscure banker meetings matter? Fair question, and it’s precisely why our GZERO team in Washington, DC, is covering the IMF-World Bank spring meetings this week.

For Masters of Monetary Policy like Powell, being bland is a strategy, not a characteristic. They speak in a purposely arcane language that requires near Bletchley Park decoding powers because everything they say makes news that impacts markets. This, in turn, affects things like your mortgage, your investments, and your grocery bill. It also impacts global poverty, which ought to make a lot more news. So understandably, they have to be careful and neutral to avoid panics or bouts of enthusiasm and ensure their signals leave lots of room for interpretation. But don’t mistake bland for lack of consequence. In global banking, bland is the brand, but influence is the purpose.

What have you missed so far?

Powell had a major bland moment at the Wilson Center’s Washington Forum on the Canadian Economy, which coincides with the spring meetings, where he hinted he would delay dropping interest rates because US inflation is proving more stubborn than predicted. “The recent data have clearly not given us greater confidence and instead indicate that it’s likely to take longer than expected to achieve that confidence,” he said, as the finance world listened to him emphasize every SYL-la-ble.

Then, in case anyone missed it, he took out the verbal highlight pen. “We can maintain the current level of restriction for as long as needed.” Whoa. Treasury yields moved higher that very moment, and he wasn’t even done speaking. Translation for those not steeped in Bland Banker Speak: Interest rates are gonna stay higher for longer – at least until the inflation rate hits the target goal of 2%. Govern yourselves accordingly.

That news got a tiny corner of social media all ginned up, giving us the world’s first – and perhaps last – Federal Reserve Meme: Check out this AI-generated Jerome Powell hyped on rate cuts. Maybe Blands really do have more fun.

Meanwhile, Bank of Canada Gov. Tiff Macklem, who was on the same panel with Powell, hinted he might go in the other direction – and having had many conversations with him over the years, I can say that Macklem isn’t bland at all. Just last week, he held the key interest rate at 5% because inflation had centimetered up a titch, but he still suggested a rate drop was “within the realm of possibilities” as early as June.

What would that mean? For one, if Canada drops rates faster than the US Fed, the Canadian dollar would likely weaken considerably, so depending on which way you travel, things could get either a lot cheaper or more expensive.

In short, everything central bankers say makes a difference to millions of citizens, and still, most folks only pay scant attention to talk about inflation and interest rates close to home – not internalizing how much impact these decisions have on major issues like global poverty. For example, GZERO’s own Matthew Kendrick has been reporting from the spring meetings this week, covering the impact of inflation on the most vulnerable economies like Somalia and what is being done to help. You can read his surprising look at the Somali success story on debt reliefhere.

But if world bankers are all so smart, why are one in three countries worse off than in 2019? Why are so many falling back into poverty post-COVID? To find out, our Head of Content Tony Maciulis sat down with Ayhan Kose, the World Bank Group’s deputy chief economist, who told him, “When the food price goes up, the price of oil goes up. That has significant implications for these economies.” He also noted that some countries have experienced “the weakest growth rate on average since the 1990s.” What are the solutions? Watch Tony’s interview here.

News about IMF and World Bank financiers doesn’t often make the front page because it’s so complex, often depressing, and … well, kinda bland. There are other riveting events, like Donald Trump’s first criminal trial, the war in Ukraine, and Iran launching missiles at Israel to grab our attention, as they should.

But spare a moment for the folks who live in Blandlandia – those people at the IMF and World Bank spring meetings. They are participating in panels like “The Path for Taxing the Super-Rich – Towards a Progressive Global Taxation Agenda,” “Biden Pauses LNG; COP 28 Fossil Fuel Phase-Out Decision – Is World Bank Lagging on Fossil Fuels?” and even “The Polycrisis – How Unchecked Public Debt Fuels Corruption and Bad Governance.”

Beneath the bland, the story of our world unfolds. Since 1944, when both financial institutions were established, the World Bank itself has funded over 12,000 programs focused on economic development and reducing poverty. Has it worked? The record is mixed.

There have been big wins – like the reconstruction of Bosnia after the war, or working on debt relief programs, like Matt described in Somalia. But the World Bank also set a goal of eliminating extreme poverty by 2023, and its leaders admit they are not even close.

Meanwhile, the IMF, whose mission is to “firefight” big, macro-economic emergencies, like a currency collapse, comes in for much harsher criticism. Its Structural Adjustment Programs – loans to low-income countries in distress – have been subjected to extensive research, often proving that they have kept people in countries like Zimbabwe or across Latin America in poverty while enriching investors. Are these Western-designed programs just a neo-liberal form of colonialism, as some suggest, or pragmatic ways to get countries onto the path of economic development? The debates are so divisive that China has moved into the space in countries that no longer trust the IMF, using its Belt and Road Initiative to invest in infrastructure and push its own influence. So, politics are driving this as well.

The IMF and World Bank may not always make things better, and there is even paranoia right now that Donald Trump, if he wins in November, might withdraw the US from the World Bank, which would devastate developing economies. Still, these two organizations are relevant and demand our attention.

At GZERO, we are committed to covering these topics and making them accessible and interesting. So please tell us what you think. If you have suggestions for things we ought to cover, or questions about events like the IMF-World Bank spring meetings, send us a note here, and we will post answers to some of your key questions next Thursday.

Thanks for your remarkable attention to all these matters, and now, let’s get at the rest of the news.

– Evan Solomon, Publisher

Annie Gugliotta

Why are Joe Biden and Justin Trudeau getting so badly eclipsed by the great totality of critics? Can good policies seize back the agenda of a lagging campaign?

President Biden is busy touting his positive economic record but is baffled when it gets eclipsed by issues like his age. He rightly touts creating 300,000 new jobs in March and dropping the unemployment rate to 3.8%, but the headlines still say he looks like a guy who might as well have watched a solar eclipse alongside Moses.

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Jess Frampton

The riddle of recovery: Is the economy broken, or is it booming? And is there a secret accelerant no elected official wants to talk about?

Turns out, how folks perceive the economy is often tied more closely to how they vote than to reality. Donald Trump's supporters argue the economy is a disaster of debt and inflation, made worse by an immigration nightmare playing out at the borders. To prove their case, they wander into the Cherry Orchard of Convenient Stats and pick a few choice numbers to make their case.

  • US debt has passed $34 trillion and will exceed the dangerous 99% debt-to-GDP ratio.
  • Between 60%-78% of US households are living paycheck to paycheck, depending on the survey.
  • Credit card debt has hit record levels, with 50% of consumers unable to pay off their monthly bills.
  • Food prices are going up even as inflation is down, rising over 2.2% from last year, according to the Consumer Price Index.
  • Big layoffs are hitting the tech, financial, retail, media, and energy sectors.
  • Home affordability: Most people with an average income can no longer afford a home, which in most cities now requires an income of over $100,000.

The harvest from that side looks rotten. But walk over to the Joe Biden side of the Cherry Orchard of Convenient Stats, and things look pretty darn good:

  • Post-pandemic, the US has been the fastest-growing economy in the G7.
  • Job growth is shattering expectations with over 353,000 jobs in January, and unemployment is under 4%.
  • Inflation has fallen to 3.2% from over 9% two years ago.
  • Real wage growth is way up.
  • The stock market is on a bull run.

Overall, it’s a pretty tasty harvest, if that’s all you pick.

Still, Gallup’s famed Economic Confidence Index – though ticking up a bit last month – is shockingly negative, revealing most Americans think things are bad. So consumers are doing boom-like things, like spending, while perceiving bust-like things – and complaining.

Plenty has been written about the lens of partisanship distorting economic reality: People believe the economy is bad, just not for THEM! “It’s now a well-established fact that partisan orientation affects expressed views about the economy,” economist Paul Krugman wrote in the New York Times. “Democrats are more positive when a Democrat holds the White House; Republicans are more positive when the president is a Republican … but the partisan effect on sentiment is two and a half times as large for Republicans as it is for Democrats.” Krugman argues that this so-called “asymmetric amplification” accounts for 30% of the “gap between economic sentiment and economic fundamentals.”

There is, however, a reality that should not be wiped aside: The post-pandemic recovery for some has not been post-pandemic recovery for all. “I think the old name for this was ‘K-shaped recovery,’ the idea that different parts of the country are experiencing vastly different conditions,” Robert Kahn, the global head of macrogeoeconomics at Eurasia Group, told me. “Rising numbers living paycheck to paycheck or getting squeezed by high debt. Conversely, many still cash flush from pandemic support/policies.”

The K-shaped recovery also means that while, say, the stock market is booming, there are painful layoffs in sectors across the economy, like tech, finance, media, and retail. When Nike is slashing $2 billion dollars, people start to notice.

Sure, some of this is a correction from over-hiring in recent years, and some might be the impact of AI, but combine that with debt levels, worries about commercial real estate, and layoffs, and you see this could be a ... Special-K kind of recovery. There is a lot of optimistic froth covering some big pain points.

But there is a deeply inconvenient political truth here: Things would be much worse for everyone without the single most controversial, politically radioactive issue: immigration.

Trump is making his entire campaign about immigration, and his fiery rhetoric about it – he recently called illegal immigrants “animals” – is now a staple. So he is not about to discuss the benefits of immigration.

Even in Canada, Prime Minister Justin Trudeau, who has presided over massive increases in immigration levels, is now saying temporary immigration – foreign workers and international students – needs to be brought “under control.” This week he admitted it has “grown at a rate far beyond what Canada has been able to absorb.” Okay…

The thing is, immigration likely saved the economy and continues to do so. “The US let in about 3 million additional people last year,” my colleague Jon Lieber, head of research at EG, told me. “That puts downward pressure on wages and is a source of new consumer spending. There are some economists who attribute the continuing strength of the American economy to this factor.”

To dig deeper – and what GZERO reader doesn’t like to dig deeper? – it’s worth checking out the analysis done by Ernie Tedeschi, the former chief economist for the White House Council of Economic Advisers. “Immigration since the pandemic has strongly bolstered US labor supply and employment,” Tedeschi wrote. “The US economy is 8.2% larger in inflation-adjusted terms than just before the pandemic. Of this, 1.6 percentage points – about a fifth of US post-2019 growth – can be accounted for directly by foreign-born workers.”

Well, that isn’t something you hear about very much on the campaign trail. Immigration is the super-charge factor of the economy? “Politically, this is pretty ironic,” says Lieber, “if the immigration crisis that is weighing on Biden’s approval rating is actually saving the US economy.”

Is it naïve to think that citizens could one day turn to their politicians to get the facts straight about the economy – or admit that some of the very things they are demonizing and running against are the things that are boosting the economy and saving their political hides?

That’s likely the biggest riddle of this recovery story.

– Evan Solomon, Publisher

The debate around the US banning TikTok is a proxy for a larger question: How safe are democracies from high-tech threats, especially from places like China and Russia?

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Former President Donald Trump attends the 2024 Senior Club Championship award ceremony at his Trump International Golf Club in West Palm Beach, Florida, March 24, 2024.

REUTERS/Marco Bello

Alongside dealing with inflation, war, AI and hyper-polarizing politics — a full cart of problems already — every US ally and opponent are also busily drawing up their Preparing For Trump (PFT) playbook. What happens if Trump 2.0 cancels trade deals? What if he pulls out of NATO? Will he use nuclear bombs? Will US isolationism cede global influence to China and Russia? Could reliable, prosperous, long-standing alliances and treaties… collapse?

This week, a colleague and I had an interesting meeting with a senior Canadian minister and PFT was the main topic. Of all countries, Canada has one of the most successful past playbooks, based on the successful renegotiation of the NAFTA deal in Donald Trump’s first term. Remember that gilded time, in 2017, when Justin Trudeau had a hot political minute playing the role of “Trump Whisperer”? His Team Canada, backed by another Trump Whisperer — former Prime Minister Brian Mulroney, who sadly just passed away — poured their maple syrup charms up and down the Beltway and it worked. But here’s the question: Is that playbook still relevant?

The short answer? No.

First off, the Trudeau and Trump bromance ended in ashes. By 2018, at the G7 summit in Canada, Trump was calling Trudeau “very dishonest and weak.” A year later, Trump said his northern neighbor was “two faced,” so let’s just say there were no invitations to go golfing.

Trump carries a grudge the way Thor wields a hammer — so expect carnage if Trudeau is still in power when the new trade deal is renegotiated in 2026.

That leaves the other key PFT route: The Logic of Mutually Beneficial Trade. The strategy, as the minister explained to me, is to play the economic hits, just like last time.

  • Canada is the US’s largest trading partner: US exports to Canada surpassed $307 Billion in 2021, while imports from Canada were $357.2 billion.
  • The US imports more oil from Canada than anywhere else.
  • The largest market for key swing states like Michigan? Canada.
  • Critical minerals and the AI future: Canada can weaken China’s dominance of the critical mineral supply chain with reliable sources of lithium, nickel, graphite and rare earth minerals.

And on it goes. In other words, these are powerful, rational arguments in favor of open trade and against protectionism and Buy America that have the benefit of truth. On a state level these arguments are still effective, and might still be convincing to members of Congress. But as my colleague pointed out to the minister — what if rational arguments like these don’t work for the Trump administration?

The first Trump administration was, like all presidencies, a mixture of political ideology and political policy, with the president surrounded by advisors who acted as guardrails to his impulsive aggressions. They kept the alliances intact. That’s no longer the case. Those internal guards have been purged in favor of hardened partisans running a permanent war room campaign that has a strong animating force: Revenge. Just this past week Trump’s own Truth Social media channel raised billions of dollars, feeding a media ecosystem that insulates him and his team from any uncomfortable intrusions of facts that might upend his self-reinforcing political narrative. Political appetites will devour logical policymaking. So, what is the strategy in that scenario?

In 2024, PFT means trying to find a way to give Trump something that he can publicly claim as a “win,” without looking weak to your own voters.

And what is that?

Jobs.

But trying to simultaneously create jobs in America without selling out your own industries is a political magic trick most foreign leaders have yet to master, and one they may not want to. That is the challenge to the Team Canada folks who are crafting the PFT and to every country doing the same thing.

The only bright side? They had practice over the last three years. President Joe Biden has proven equally protectionist on many industries and the same arguments apply to him, only it’s much more behind closed doors, which makes the negotiations easier.

Maybe the PFT industry is why Trump supporters say he’s so effective. Before he’s even in power, he already has the upper hand. His threat of over-the-top retaliations has effectively put the US in a stronger negotiating position on trade, security and diplomacy — and he’s not yet in office. His plausible threat to collapse the status quo is his most effective negotiating tool. It may make for less trustworthy alliances, weaker international treaties and a more dangerous, less prosperous world, but it fulfills the number one Trump promise to his supporters: America First.

Jess Frampton

In the traffic jam of elections that is 2024 – there are over 50 this year worldwide – the US is still the BelAZ 75710 mega hauler of elections, the biggest rig that carries more payload than any other on the political road. So when it tips over, it’s impossible to ignore. Everything matters about the US 2024 election, and we have to stay within the nonpartisan lines to avoid veering off-road.

So after Donald Trump gave a fiery speech in Ohio last weekend about an impending “bloodbath” if he’s not elected, it’s worth sorting through the carnage of coverage to see what he meant. “Now, if I don’t get elected, it’s going to be a bloodbath for the whole…” he said. “That’s going to be the least of it, it’s going to be a bloodbath for the country. That’ll be the least of it.”

Did he mean another civil war, as some thought? Or, more plausibly and as his campaign has claimed, did he say it in the context of the auto industry and his concerns about high tariffs from China and Mexico?

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Annie Gugliotta
For the past 17 years, Perrin Beatty has been the voice of business in Canada. And that means he cares about one key thing: the United States. After all, Beatty has long understood that for Canadian business, the biggest customer, opportunity, market, threat — you name it — has always been the United States. And Canada has been the biggest or second biggest market for the US. Beatty, who served as defense minister under Prime Minister Brian Mulroney in the late 1980s, gave me his view of what to watch for in this volatile election year and why Canada’s three F’s matter more than people think.
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President Joe Biden looks up as he mentions his mother during addressing the Irish Parliament at Leinster House, in Dublin, Ireland, April 13, 2023.

REUTERS/Kevin Lamarque

“Those clouds are not real,” the woman standing next me at the car pickup spot said, pointing to the overcast skies above San Diego.

I had just arrived here to speak to a group of business leaders about Eurasia Group’s Top Risk report and the political landscape ahead in a year of polarizing elections.

“Sorry?”

“It’s usually beautiful and sunny here, but now with the cloud seeding, all we get is this,” she explained, adopting that apologetic tone proud locals use when their home isn’t exhibiting its best for a visitor. She interrupted her weather flow to give me some other tips about local restaurants — “check out Roberto’s taco stand” — and hiking in the area, before returning to the weather.

“Yeah, you know all those floods we had this past month?” she asked rhetorically. “They’re from these clouds the climate folks created with their cloud seeding because they want to block out the sun to cool the Earth down.”

And then she added the kicker: “And it’s poison, you know.”

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