The Economist Latin America September 3, 2022

Exceptionally heavy monsoon rains over two months have caused devastating floods in Pakistan, killing more than 1,100 people and leaving a third of the country under water. Shehbaz Sharif, the prime minister, said that a million homes have been wrecked and thousands of miles of roads destroyed. The climate minister described it as a “catastrophe”, blaming countries that have become “rich on the back of fossil fuels”. Separately, the IMF approved a $1.1bn payout to Pakistan after the government implemented an austerity budget, which included sharp increases in fuel and food prices amid high inflation. The measures have quickly made the new government unpopular. The IMF also reached an agreement to provide Sri Lanka with a $2.9bn loan to help it through its worst economic crisis since independence in 1948. As part…

Central-bank officials attending the annual Jackson Hole symposium conveyed a clear, hawkish message on interest rates. Jerome Powell, chairman of the Federal Reserve, said he expected the Fed would raise rates throughout next year. Officials from the European Central Bank talked of “sacrifice”, and said that the lessons of the 1970s showed there should be no easing of monetary tightening at the first signs of a dip in inflation. The ECB is expected to lift rates at its next meeting on September 8th. The central bankers warned that higher rates were necessary to tame inflation, even if they lead to recession. The stark commitments to carry on with rate increases rattled stockmarkets. The S&P 500, NASDAQ composite, Dow Jones Industrial Average, FTSE 100 and German DAX all fell sharply over a…

Exceptionally heavy monsoon rains over two months have caused devastating floods in Pakistan, killing more than 1,100 people and leaving a third of the country under water. Shehbaz Sharif, the prime minister, said that a million homes have been wrecked and thousands of miles of roads destroyed. The climate minister described it as a “catastrophe”, blaming countries that have become “rich on the back of fossil fuels”. Separately, the IMF approved a $1.1bn payout to Pakistan after the government implemented an austerity budget, which included sharp increases in fuel and food prices amid high inflation. The measures have quickly made the new government unpopular. The IMF also reached an agreement to provide Sri Lanka with a $2.9bn loan to help it through its worst economic crisis since independence in 1948.…

Central-bank officials attending the annual Jackson Hole symposium conveyed a clear, hawkish message on interest rates. Jerome Powell, chairman of the Federal Reserve, said he expected the Fed would raise rates throughout next year. Officials from the European Central Bank talked of “sacrifice”, and said that the lessons of the 1970s showed there should be no easing of monetary tightening at the first signs of a dip in inflation. The ECB is expected to lift rates at its next meeting on September 8th. The central bankers warned that higher rates were necessary to tame inflation, even if they lead to recession. The stark commitments to carry on with rate increases rattled stockmarkets. The S&P 500, NASDAQ composite, Dow Jones Industrial Average, FTSE 100 and German DAX all fell sharply over…

TWO STATES, two very different states of mind. On August 25th California banned the sale of petrol-powered cars from 2035, a move that will reshape the car industry, reduce carbon emissions and strain the state’s electricity grid. On the same day in Texas a “trigger” law banned abortion from the moment of conception, without exceptions for rape or incest. Those who perform abortions face up to 99 years in prison. These two events may seem unrelated, but they are symptoms of an important trend. Washington, DC, may be largely gridlocked, but the states are making policies at a furious pace (see Briefing). In theory, that is no bad thing. With 50 states, America has 50 laboratories to test which policies work and which do not. People can choose to live and…

TWO STATES, two very different states of mind. On August 25th California banned the sale of petrol-powered cars from 2035, a move that will reshape the car industry, reduce carbon emissions and strain the state’s electricity grid. On the same day in Texas a “trigger” law banned abortion from the moment of conception, without exceptions for rape or incest. Those who perform abortions face up to 99 years in prison. These two events may seem unrelated, but they are symptoms of an important trend. Washington, DC, may be largely gridlocked, but the states are making policies at a furious pace (see Briefing). In theory, that is no bad thing. With 50 states, America has 50 laboratories to test which policies work and which do not. People can choose to live…