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Inefficient markets

Higher energy prices are likely to mean rising inflation and slower growth. But at least Doha may be back on track. Plus the misguided populism of EU commissioners

By P L   August 2006

Stagflation lite

US interest rates are already 5.25 per cent, euro rates are set to rise again on 3rd August, the next move in British rates looks likely to be up, and as deflation recedes, even Japan has finally raised rates. After years of borrowing cheap to take ever more exotic speculative gambles, investors are rediscovering risk and retrenching. This is not yet a bear market. The Dow, the FTSE and Morgan Stanley’s international stock market index remain up so far this year—just. But markets may tumble once people realise that even in a more flexible and globalised economy,…

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