The Economics Show The Wolf-Krugman Exchange: your questions answered
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Jul 9, 2025 
In this engaging dialogue, Nobel Prize-winning economist Paul Krugman shares insights on global trade complexities as countries tighten control over technology and trade. He discusses U.S.-China tensions and their implications for fiscal policies. The conversation also touches on the challenges of cryptocurrency, advocating for international climate tariffs, and navigating the complications of carbon taxes amid rising populism. Krugman's thoughtful critiques illuminate the intersection of economics and democracy in our rapidly changing world.
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Challenges in New Trade Trust
- Building long-term trust for new global trade deals is very difficult amid current U.S. political instability.
- Emerging economies lack leverage, and China and Europe also face mutual suspicion, complicating global cooperation.
Trade Weaponization and Fragmentation
- The U.S. and China weaponize trade for national security purposes, disrupting global cooperation.
- China won't replace the U.S. as a stable hegemon, and we face continued fragmentation of trade alliances.
Dollar Fragility and Market Risks
- Erratic U.S. policies hurt the dollar's global role, but no currency is ready to replace it yet.
- The U.S.'s governance fragility risks fragmenting integrated global financial markets.