Final Word from Thursday, November 16, 2017

The CR, with its 5% economic growth, isn't just Europe's tiger, but also Europe's ATM. The combination of a devaluation, increased government spending, investment incentives, corruption, lax rules on transfer pricing, and self-censorship by the media have allowed foreign investors - and some rich Czechs - to extract billions and billions from the Czech economy. Expatriation of dividends is a standard part of a free-market system, and that isn't the main issue. More important is how the CNB signaled its monetary policy to speculators both before the devaluation and after the cap on the crown was lifted. Or how the coalition government wooed Amazon without demanding that it shut down its Luxembourg tax-avoidance scheme. Or how clients of Air Bank are kept in the dark about the way their deposits are used to fund mobile-phone loans to bad-risk Chinese. Of course things are now slowly changing in the CR, because the ATM is running out of money. [Czech Republic Czech National Bank central PPF]