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As the French artist turns 100, a retrospective salutes a titan of abstraction

On Christmas Eve Pierre Soulages, who has painted only in black for 70 years, celebrated his 100th birthday. France’s gift has been to offer the artist a retrospective in the Salon Carré of the Louvre: the magnificent skylit gallery with towering window and a vaulted gilt ceiling, engraved with the names of painters from the Renaissance to Poussin.

In this baroque splendour, Soulages’ paintings — vibrating, glistening, ever-changing — take their place in history. Here unfolds the extraordinary, single-minded career of an artist who paints light out of darkness.

In France, Soulages is a destination artist, his paintings in outrenoir — “beyond black” — as popular a trademark as Yves Klein blue. He’s less known internationally, but during the show’s opening days, in a strikebound city, visitors packed the gallery. Couples lingered, girls posed in chic black numbers, groups larked about, as at an immersive installation.

The six-metre “Peinture 290 x 654cm, fèvrier-mars 1992” (all Soulage’s paintings are neutrally titled by dimension and date in this way) rises majestic and solid. Yet horizontal striations make it flicker like a vast screen, bright or sombre according to where you stand. In “Peinture 304 x 181cm, 9 decembre 2007”, a stack of different textures — ridges cut with a blade like a relief, thick matt paint, a silky smooth surface, sculptural effects of a brush dragged through black paste — produce light effects that ripple down a single canvas.

Soulages, a six-foot-plus former rugby player who always wears black, has created vigorous new work for this condensed retrospective. “Peinture 390 x 130cm, 10 août 2019” and “ Peinture 390 x 130cm, 26 août 2019” are long narrow panels crossed with multiple strokes of varying intensities and rhythmic modulations. The renowned American curator James Johnson Sweeney likened Soulages’ paintings to a chord played on the piano and held; these latest works also call to mind the artist’s own black-lined stained-glass windows in the abbey church at Conques, near his native Rodez in southern France.

Soulages accepts comparisons with music, and acknowledges inspiration from Romanesque architecture, and also from prehistoric cave paintings — executed in darkness — in the same area of France.

He notes, too, that he “preferred winter trees and wet trunk season even in childhood”, when “absence of more intense and powerful colours give a more intense and powerful quality of presence”. In the dense “Peinture 300 x 236cm, 10 janvier 1964”, pierced with soft white glimmers, you feel the weight yet exhilaration of winter darkness. The diptych “Peinture 222 x 314cm, 24 fevrier 2008” is a geometry of night black traced on one side with a long oblique furrow, on the other with a comet-streak of light. Austere abstraction unexpectedly delivers a seasonal, almost festive show. One reason is that Soulages’ oeuvre turns on a paradox. As the artist puts it, “a painting is a material object made up of stretcher, canvas, forms, colour and so on. But it has a reality that goes way beyond material existence.” How materiality in the early works heralds later metaphysical concerns is the narrative arc here.

Soulages emerged in 1946 in art informel circles. Reacting to the wreckage of Europe, he fled the certainties of figuration for rough-delicate, gestural, improvisatory mark-making.

His early experiments with poor materials are visible here in the tangled “Brou de noix” drawings, made in a dark stain brewed from walnut husks. These connect him to southern contemporaries such as Antoni Tàpies and Alberto Burri, who also used sand, tar and plastic. But Soulages was soon increasingly interested in opacity and translucency: in the “Goudron sur verre” series from 1948, he applies tar to broken glass panes with a house painter’s broad brush.

In the 1950s, he began interlocking wide black slashes and beams of light in compositions of engrossing structural beauty and elegance: a dense grid on a rich bronzed ground in “Peinture 195 x 130cm, mai 1953”; floating bars of silver and umber in “Peinture 195 x 130cm, 14 mars 1955”.

By then Soulages was friends with Mark Rothko. The art historian Ernst Gombrich also compared his energetic, freewheeling brushstrokes to Franz Kline — though reckoned that in Soulages “the quality of the paint looks more pleasant”.

We see now the difference between American abstraction’s absolutist drive to the sublime and Soulages’ more playful spirit. But Soulages has lived so long that he’s overlapped fascinatingly with disparate movements.

And although he is independent, he is sensitive to the zeitgeist: the line-up of thunderous black blocks in “Peinture 220 x 336cm, 14 mai 1968” reads like an angry poster from that year’s student demonstrations.

In 1979 Soulages, approaching 60, invented outrenoir — a late manner in which “I don’t work with black, I work with the light that reflects it”. “Peinture 162 x 127cm, 14 avril 1979” is an early example of the varied textures — smooth, fibrous, agitated — with which he brought out grey blacks, deep blacks, capturing or blocking light.

Describing outrenoir as “a light transmuted by black”, he went on to explain: “As Outre-Rhin [beyond the Rhine] and Outre-Manche [beyond the Channel] refer to a different country, this is a mental realm, different to plain black.” No other artist has a late style that has endured an astonishing four decades.

There have been developments. In the 2000s, Soulage introduced quick-drying acrylic, as in the lustrous, pristine comb-like patterns of “Peinture 130 x 130cm, 19 juillet 2012”.

The canvases have become monumental. And one sees contemporary connections — it was also in 1979 that the light artist James Turrell began his massive observatory “Rodin Crater”, and the conceptual aspect of Soulages’ own project is suggested by his definition: “I organise the light, which is born on and through the paint.” Yet Soulages’ outrenoir has surely lasted because the exploration of light is the essence of painting, an endless quest.

Great painters who reached old age — Titian, Monet — often adopted late styles concerned with abstract light effects and inner “mental realms”. At the end of the exhibition, you are tipped from the Salon Carré straight into the Giottos in the Grande Galerie. A light beam passing from Giotto’s flying Christ to the saint animates the golden, vertical “St Francis Receiving the Stigmata”. In a moment of wonder, Soulages meets the beginning of western painting.

U.S. buyers are flocking to France’s capital city and fueling its real-estate market

At midnight in Paris on December 31, Lawrence and Christine Taylor will dine near the twinkling Eiffel Tower, with a view of the New Year’s fireworks over the River Seine.

Rather than retire to the hotel suite they rented for years, they will end the night in their own apartment by the Luxembourg Gardens, with the bells of the Saint-Sulpice church ringing in the New Year from outside their bedroom window.

“My wife has been in love with Paris for many years,” says Mr. Taylor, president of Christina, a Malibu, Calif.-based real-estate investment firm.

For most of that time, Mr. Taylor, 65, and his wife, 64, stayed at the Hôtel Plaza Athénée. But in May 2017, they bought a three-bedroom, two-bathroom apartment for €3.6 million (now $4 million) and now go to Paris at least four times a year. “There is nothing like having your own place,” he says.

The Taylors are undaunted by a continuing nationwide transportation strike that has disrupted travel in France for the last three weeks. Trains, planes and public transport including the Paris metro are suffering delays and cancellations, as trade union members protest a government pension reform plan. But strikes and demonstrations are rarely as bad as media reports suggest, Mr. Taylor says.

“It’s part of the fabric of France,” he says. “It’s nice to see the passion on the part of the populace that we don’t always see” in America.

Americans account for a large and growing share of international buyers in Paris, real-estate agents say. Athena Advisers, an international property-investment advisory firm that sells homes in Europe and Brazil, says from January through October of this year, the number of Americans inquiring about Paris rose by a third over the first 10 months of last year. Rather than small pieds-à-terre, agents say, Americans are buying big apartments or townhouses, often with grand views and sumptuous features, both in prime areas long popular with foreigners and in grittier neighborhoods with fewer tourists and a more authentic feel.

“The market has moved,” says American-born Betsy Kasha, founding partner of AB Kasha, a Paris-based real-estate development and interior-design firm that specializes in finding and renovating apartments for high-end French and international buyers. “People used to want one- or two-bedroom apartments. Now they want three or four bedrooms.” U.S. buyers, she says, have expanded beyond the French-speaking intellectuals traditionally prone to buying in Paris. “It has become a status symbol to have a Paris apartment. It’s not just the intellectual elite now; it’s the wealth elite.”

In the City of Light, real estate is on fire. From July through September of this year, the average sale price totaled €10,100 per square meter ($1,000 a square foot), a 6% rise from the year-ago period and a 25% increase over five years, according to the Chamber of Notaries of Paris. In the prestigious sixth arrondissement, where the Taylors bought, the average sale price was €14,200 per square meter ($1,500 a square foot), a 9% rise from the same time last year, although luxury homes in top locations can cost more than twice as much. In the luxury segment, prices and sales volume are growing well above the average rate.

“The first semester of 2019 has been spectacular, and the second one will be historical,” says Laurent Demeure, president of Coldwell Banker France and Monaco. “Everybody is expecting a crash in the stock market, so people are buying real estate.”

Almost weekly, Mr. Demeure acquires new American clients, attracted by a favorable exchange rate that boosts their purchasing power in euros. In addition, he and other agents say, the Paris market benefits from historically low interest rates and a “Brexit Bump” of Londoners and French expatriates in the U.K. buying homes in the French capital ahead of Britain’s planned departure from the European Union.

Further fueling demand are the wealthy citizens who are returning to France because of President Emmanuel Macron’s tax cuts and reform agenda, and overseas investors looking for stability that London no longer offers. Despite the recent price hikes, agents note, Paris real estate is still more affordable than that in London or New York.

This year marks the Taylors’ 10th New Year’s Eve in Paris. Over the years, the couple had looked at about 50 apartments and almost bought another one, in dire need of renovation, when Ms. Kasha’s husband, Alon, showed them a 1,600-square-foot apartment they had recently refurbished. Located in a 19th century building with classic ironwork balconies, it combined period features, such as crown molding and floor-to-ceiling French windows with modern comforts, such as central air conditioning, under-floor heating in the bathrooms and high-end appliances in the kitchen. The Kashas coached the Taylors in the purchase, helped them to set up utility and insurance accounts and now prepare the home for every arrival. Last year, the Taylors added to their Parisian holdings: They bought the former concierge lodge near their building’s entrance for €180,000 ($200,000) and spent €250,000 ($277,000) turning it into a studio for guests.

We now have an upstairs apartment and a downstairs pied-à-terre,” says Mr. Taylor.

Another American in Paris, Angela van der Meulen, dreamed of owning a home in the city since she lived there as an au pair in her youth. Ms. van der Meulen, originally from Yakima, Wash, had been living in Luxembourg for seven years with her husband Jorrit van der Meulen, an American executive, when, in June 2018, the couple bought a four-bedroom, 1,900-square-foot apartment on a wide, tree-lined boulevard in the 11th district for €1.8 million (now $2 million). Like a growing number of American buyers, Ms. van der Meulen, 54, wanted to live in a regular Parisian neighborhood, rather than in one of the tourist districts.

“Ten years ago, Americans bought apartments only in Saint-Germain-des-Près and the Marais but they are now buying in other areas as well,” says Guillaume Poitoux, president of real-estate agency La Commune Immobilier, who found the van der Meulens’ apartment and helped them with the transaction.

“More and more people who buy apartments in Paris don’t want to be in a postcard of historic Paris. They want a real Parisian way of life.”

The van der Meulens’ light-filled apartment came with old parquet floors, richly ornamented ceilings and a rounded bay window. The couple spent about another €350,000 ($388,000) on a seven-month renovation. As in many Paris apartments, the kitchen was in the back at the end of a hallway, Ms. van der Meulen says. A designer with a small wallpaper collection, she moved the kitchen to the front, created a master suite with closet space and a modern bathroom, and added a shower to a powder room to create a guest bathroom.

Renovations are part of buying in Paris, where apartments in the period buildings that dominate the city often lack the light, layout and amenities foreign buyers expect. Few have en suite bathrooms, modern showers, elevators or underground parking. With little land for new construction and strict building codes, there is scant development of the high-end apartments that foreigners and returning French expats look for. The result, real-estate agents, say, is a shortage of such properties on the market.

“There is a luxury demand but there isn’t a luxury product,” says Susie Hollands, British-born founder and chief executive of Vingt Paris, an agency focused on an international clientele. “There is nothing on the market. We have the buyers, but we often have to handle renovations for them.”

Ms. Hollands recommended architects and contractors to American client Jodi Humphreys, a London-based software developer who bought a 2,500-square-foot apartment in the ninth district, near the Pigalle and Montmartre neighborhoods for €2.4 million ($2.7 million) last year. She also helped with utilities accounts, new locks and a boiler replacement.

Ms. Humphreys, 51, and her husband, an Indian-American programmer, are also planning to remove the dropped ceilings in some rooms to expose the molding, move a door, enlarge a bathroom and install a shower.

The couple spends nearly every weekend in Paris. They arrive by train on Friday night, and often have a glass of wine near an open window in their apartment, listening to the sounds from a sidewalk café. There are fireplaces in two rooms of the apartment.

“Coming from central London, Paris apartments have so much more charm,” says Ms. Humphreys.

Chinese Ambassador Threatens EU With "Disastrous" Consequences If It Launches Curbs Against Chinese Companies

Less than two weeks after Beijing issued an overt threat at Germany, when Chinese ambassador to Germany Ken Wu told ex-Foreign Minister Sigmar Gabriel that if Germany excludes Huawei 5G from its communication networks, then China could "declare German cars unsafe" for its domestic market, effectively giving Angela Merkel a quid-pro-quo ultimatum that a ban of Huawei - as demanded by the Trump administration - would lead to retaliation against German auto exports, Beijing’s ambassador to the EU, Zhang Ming, doubled down and warned the bloc against pursuing policies to curb Chinese companies’ access to Europe, saying it would damage its own interests and deter investment.

The ambassador, a veteran diplomat and previously a senior foreign ministry official in Beijing, said plans to clamp down on foreign corporate ownership, trade opportunities and 5G mobile communications technology threatened to trigger a backlash from “suspicious” Chinese entrepreneurs. Ming added that EU countries needed to promote international co-operation and free markets, by which of course he meant free markets that suit China. "Otherwise, it’s disastrous for them," he warned in an interview with the FT.

"What I hope to see is that the EU will keep to the principles of multilateralism and free trade, as well as the principles of openness, fairness, justice and non-discrimination."

Zhang said the hardening attitude on the EU side had made "many Chinese entrepreneurs working in Europe suspicious” and “also had some kind of impact on Chinese investment in the EU."

"My colleagues and I are strongly committed to promoting China–EU co-operation, so I’m following the development with interest and concerns," said the envoy who was a former vice-minister of foreign affairs and took his current post in Brussels in 2017. "Capital is very sensitive, and even cowardly in some cases. In case of any changes or developments, they will feel highly vigilant or even be scared away"

The envoy's remarks highlight the growing tensions between China and Europe as the EU makes what critics see as "a belated effort to respond to Beijing’s strategic ambitions, nationalistic trade policies and behavior to western enterprises" according to the FT. EU companies and governments have long complained that China greatly restricts access to its own market and heavily favors domestic businesses, while demanding full access to foreign markets.

EU countries are expected in January to publish final recommendations for tougher security checks on 5G equipment companies, where China's Huawei is a world leader and highly active in Europe. The bloc is also looking at tighter procurement rules and stricter screening of foreign investments, including of businesses that use government backing to gain an advantage when acquiring European rivals.

While Europe has so far treaded cautiously in implementing a blanket ban on Chinese companies as Trump has long demanded, diplomats say 2020 is set to be crucial for the EU-China relationship, with bloc leaders hoping to host President Xi Jinping at a summit as both sides grapple with stresses in their ties and tensions with President Donald Trump’s US administration. In March, the EU for the first time declared Beijing a “systemic rival” in some areas.

Zhang hit back at suggestions in December by Sabine Weyand, the EU’s top trade official, that talks on a new investment treaty with China, due to be concluded in 2020, were moving at a "snail’s pace" and needed more commitment from Beijing.

"Is it a tactic or a trick played by the EU side?" Mr Zhang asked, insisting there was still “hope” for the negotiations if both sides were prepared to “meet each other halfway." He then added that "talking about the speed of the negotiations, I think it’s better to be a down-to-earth turtle than a cunning rabbit."

In a delightfully ironic twist, the Chinese diplomat also pointed to potential concerns about a proposed EU carbon border tax, which could hit China’s steel exports to the bloc. "Some are asking whether such a tax is in line with WTO rules, or whether it’s going to lead to protectionism and trade tensions," he said, clearly ignoring Beijing's hypocritical condemnation of the US exit from the Paris Treaty when it is China that over the past several years has emerged as the world's greatest polluter.

Then there is the issue of human rights, which has emerged as another potential flashpoint. Beijing has drawn condemnation from campaign groups and criticism from the EU for interning more than 1 million Muslim Uighurs in so-called concentration re-education camps in western China.

The ambassador denounced the European Parliament’s award in December of its Sakharov Prize for freedom of thought to Ilham Tohti, an advocate for China’s Muslim Uighur community who is serving a life prison sentence for allegedly advocating independence for China’s north-west region of Xinjiang.

Ensuring that China won't make too many friends with his interview, Zhang accused the EU more widely of “unjust and dishonest rhetoric and behaviour” in its attacks on China’s human rights record. Almost as if he just discovered that hypocrisy is the bedrock of foreign policy.

China’s outreach in Europe has stoked further friction. Specifically, Zhang hit out at moves in EU countries against the Chinese state Confucius Institute, which Beijing insists is a cultural organization rather than the propaganda or espionage tool alleged by critics. Vrije Universiteit Brussel in the Belgian capital said in December that it would end its contract with the Confucius Institute in 2020, as the co-operation was “no longer consistent” with VUB’s policies, objectives and “principles of free research."

“For some time America and some Western politicians and media are quite suspicious of the Confucius Institutes,” Zhang said. “They are making attacks on these institutes, but they have yet to come up with solid evidence, and so such moves are quite radical and discriminatory."

He may have a point: after all George Soros' 'Open Society' remains welcome across Europe for spreading the "virtues" of democracy and open society, especially in those nations that urgently need a presidential coup d'etat.

Over the past decade, the average ticket price for the top 100 North American tours has increased 55% to $94.83

Concert tickets are more expensive than ever and fans seem more than willing to pay the price.

The Rolling Stones had the highest-grossing tour across North America this year, raking in $177.8 million, according to trade magazine Pollstar. Though the British rock band played just 16 dates, a hefty price tag—tickets averaged $226.61 a pop—helped the group top the list.

Nine of the 10 highest-grossing concert tours this year had average ticket prices above $100, Pollstar reported. Over the past decade, the average ticket price for the top 100 North American tours has increased 55% to $94.83. The average gross per show more than doubled over the decade to $958,000.

The run-up comes as artists are relying more on touring for income, promoters have smartened up about pricing, and as ticketing companies are offering new technology to squeeze out scalpers and make more money the first time a ticket is sold. The high prices have caught the attention of the U.S. government, which has investigated concert promoter Live Nation Entertainment Inc. over its market power.

The boom in the live-events business fills a gap in many artists’ revenue streams. As piracy decimated recorded music sales starting in the early 2000s, artists began to rely on touring, ever more so in the past decade. Live shows account for some 75% of musicians’ income, compared with around 30% in the 1980s and 1990s, according to analysis by Alan Krueger, a Princeton University economist who died this year.

Among other things, artists and promoters are now more apt to sell their best seats for what the market will bear, something they avoided in the past either for fear of being perceived as taking advantage of loyal fans or because they didn’t know how much the public would be willing to pay.

“You have some artists who want to get the price for the ticket that consumers are willing to pay,” said David Goldberg, a former ticketing executive and now senior adviser to the growth-investing arm of private-equity firm TPG.

The shift in music consumption from physical and digital download sales to streaming has fueled the trend. Streaming—which now accounts for 80% of recorded-music consumption in the U.S., according to Nielsen Music—is helping artists reach more fans faster in markets around the world.

As artists have become more reliant on their live business, focus has turned to maximizing the income from concerts. Ticketing companies have introduced new technology to prevent scalpers from snapping up swaths of tickets and reselling them for a markup on sites like eBay Inc. ’s StubHub, which recently was sold to Geneva-based Viagogo Entertainment Inc. for $4.05 billion. Such measures have helped artists capture some of the value that traditionally has flowed into the $10 billion resale market.

Airline-style dynamic pricing, offered by Live Nation subsidiary Ticketmaster and others, makes it possible to change the list prices at any time or automatically adjust them up or down based on demand.

Promoters, meanwhile, have been pricing seats higher—particularly the most desirable ones, such as those at the front of the house—and collecting more on VIP packages like meet-and-greets and merchandise that get tacked onto tickets. Taking another page from airlines’ playbooks, Live Nation has begun charging more for aisle seats at some shows—labeling them “premium aisle seats” and collecting as much as $30 more a piece.

The concert giant ended 2018 with $10.79 billion in revenue, up 11% from the prior year. Its Ticketmaster subsidiary holds an estimated 80% of the ticketing market, according to people in the concert industry.

On a subsequent analyst call, Mr. Rapino said concert tickets are still “very affordable.”

“We believe the ticket is completely still underpriced,” he said, pointing to the still-robust secondary market. “We’ll make progress with the artists to keep pricing it better.”

The Justice Department last week reached an agreement with Live Nation following allegations the company sought to strong-arm concert venues into using Ticketmaster. Live Nation denied the allegations, according to a court filing, but agreed to conditions requested by the Justice Department.

The department believes Live Nation’s conduct has violated the terms under which the government allowed the top concert promoter to merge with the dominant ticket seller in 2010. That agreement, known as a consent decree, forbid Live Nation from forcing venues that want to book the concert promoter’s tours to use Ticketmaster for those shows, and from retaliating when venues choose to use a ticketing competitor instead—conditions designed to keep consumer prices in check by preserving competition in the live-event market.

As ticket prices have risen, critics have questioned whether the settlement has worked as intended.

The new agreement will extend those conditions through 2025, and make it easier for the government to investigate and punish Live Nation for violations.

Corrections & Amplifications

The average gross per show more than doubled over the past decade to $958,000. An earlier version of the story incorrectly put the figure at $958 million. (Dec. 26, 2019)

To halt money-market volatility the Fed flooded markets with cash—and it accumulated assets. But at year’s end some banks may limit lending.

The Federal Reserve over the last three months has flooded money markets with hundreds of billions of dollars in cash to avoid a repeat of volatility that roiled cash markets in September.

The success of the moves—which reversed roughly half of the Fed’s shrinkage of its asset portfolio over the prior two years—will encounter a test around Dec. 31. That is when some financial institutions could face incentives from regulations to limit their lending, which could cause supply and demand imbalances for cash.

Fed officials have said they believe deposits by banks held at the Fed, called reserves, grew scarce enough in mid-September to put pressure on an obscure but important lending rate in the market for repurchase agreements, or repos. Banks and other firms use repos as a way to borrow cash for short periods, pledging government securities as collateral.

“You can flood the markets with reserves but are the reserves going to be redistributed to the corners of the markets that need it? That’s the big question,” said Ward McCarthy, chief financial economist at financial-services company Jefferies LLC.

To prevent a squeeze from happening again, Fed officials have been buying short-term Treasury bills from financial institutions to put more reserves back into the financial system. They also have conducted daily injections of liquidity into markets.

Altogether, those operations could add nearly $500 billion in net liquidity to markets around Dec. 31.

The end of the year is an important date because large banks could limit lending activities in derivatives and repo markets to guard against extra regulatory burdens. For these banks, their lending profile on Dec. 31 is used to determine how much equity capital they must raise against their liabilities.

In the last few years, repo rates have typically been no more than a 10th of a percentage point above or below the Fed’s benchmark rate, but on Dec. 31, 2018, they widened by 2.75 percentage points.

This spread grew again on Sept. 17 after large payments of corporate taxes and Treasury auction settlements the day before resulted in a major transfer to the government of cash held in the banking system. This flow of payments reduced reserves.

“The markets acted as though reserves had become scarce,” Fed Chairman Jerome Powell said at a Dec. 11 news conference.

The September episode prompted the Fed to intervene in markets to prevent reserves from declining further. The central bank announced plans to provide overnight and 14-day loans in the repo market, and by mid-October had agreed on a scheme to keep reserves from declining further by purchasing $60 billion a month in Treasury bills.

“Their response has been very effective,” said Priya Misra, head of interest-rate strategy at TD Securities. “They were quick to acknowledge reserves dropped too low. They were very humble, and that level of humility is good to see.”

The September market stress may have also focused financial institutions that rely on repo funding to lock in financing ahead of the end of the year.

“There is some evidence that people are getting their ducks in a row,” said Seth Carpenter, chief U.S. economist at UBS Group AG and a former official at the Fed and the Treasury Department. He said he sees a one-in-three chance of repo-market issues at year-end.

If there were going to be destabilizing money-market pressures on Dec. 31 they should be cropping up now, said Mark Cabana, head of short-term interest-rate strategy research at Bank of America. “The concerns in my own mind have cooled significantly,” he said.

The Fed added hundreds of billions of dollars in reserves to the banking system earlier this decade when it purchased Treasury and mortgage securities to stimulate the economy when short-term interest rates were near zero. It began draining these reserves in 2017 by allowing more of those assets to mature without replacing them.

It stopped doing so in July, after cutting short-term rates in response to worries about the global growth outlook.

Reserves are a liability against assets on the Fed’s balance sheet, and they can decline when the Fed holds its balance sheet steady if other liabilities rise.

This is precisely what happened in August and early September, after the Treasury Department began rebuilding its general account—maintained at the Fed—after Congress suspended the federal borrowing limit. This cash balance is one of several liabilities on the Fed’s balance sheet that had been growing, further squeezing reserves out of the system.

Fed officials are also trying to determine whether postcrisis rules meant to assure major banks have a sufficient cash cushion to weather a crisis have led banks to hoard reserves, aggravating the September market tumult.

The episode caught Fed officials by surprise in part because they didn’t think reserves had grown especially scarce.

As the Fed fine-tunes its response to money-market volatility, its officials face a broader tension. They want to avoid spikes in the repo market—such as those related to the year-end funding pressures—that could interfere with their ability to set short-term interest rates.

But they don’t necessarily see their job as to eliminate volatility entirely from short-term lending markets. One risk: Stamping out volatility during normal times could yield more volatility when shocks hit.

“You do want to create room for repo rates to vary again, and create a margin where normal market forces can play out,” said Lou Crandall, chief economist at financial-research firm Wrightson ICAP.

What the Fed is doing right now, he said, appears designed to provide a guardrail for markets as the central bank and Wall Street learn more about any unexpected side effects from changes in market structure and regulation after years in which the Fed maintained a larger asset portfolio.

“We are going to be in an era for the next couple of years in which…money markets can experience severe distortions that are just inefficient,” Mr. Crandall said.

There is more support for genome alteration for serious diseases than for ‘enhancement’

Here is a name to look out for in 2020: Denis Rebrikov. The combative Russian biologist wants to edit the genes of human embryos to cure deafness. If his ambition sounds familiar, it is because a scientist has already trodden a similar heretical path.

At the end of 2018, Chinese biophysicist He Jiankui created the world’s first gene-edited babies, disabling a gene called CCR5 in an attempt to make twin girls immune to HIV. That Mr He experimented with human pregnancies sparked global outrage, given the possibility that the infants could suffer unpredictable genetic side-effects.

The backlash has not quashed the enthusiasm of mavericks like Mr Rebrikov, from the Pirogov Russian National Research Medical University in Moscow, who awaits approval for the work from Russian authorities. The Pandora’s box that opened at the end of this decade — the idea of genetically editing the human race out of disease and perhaps towards an ideal — may well define science in the next. One expert has even speculated that humans may need to change their genes to survive global warming.

Diving into genomes in order to tweak them has become possible — and cheap and easy — thanks to a technique known as Crispr/Cas9. This method, one of the outstanding breakthroughs of the past decade, sends a targeted enzyme into a genome to edit the DNA. Think of it as the molecular equivalent of sat-nav and scissors: disease-causing genes can be deactivated, stripped out, amended, even replaced.

The catch is that the technique is not foolproof. It can cause unintended changes in other parts of the genome. Such “off-target effects” have been observed in edited animal embryos.

Tinkering at a very early embryonic stage, as Mr He did, also means the edits affect germ cells, which are involved in generating eggs and sperm. Such “germ line” changes affect not only that embryo but its descendants via genetic inheritance. That is why the germ line editing of human embryos, also called heritable genome editing, has been deemed unthinkable.

Mr He’s willingness to cross that ethical red line is chilling. The twin girls will need lifetime monitoring, their futures destined to follow an uncertain genetic script. It is not even clear that the promised immunity, against a preventable and treatable virus, has been achieved. If it has, this narrow triumph may have a price. Genes associated with one disease sometimes protect against others. Mutations in the CCR5 gene are also linked to a shorter lifespan.

Many have called for a moratorium on heritable genome editing. That has not materialised, to the relief of Robin Lovell-Badge, from the Francis Crick Institute in London. Professor Lovell-Badge chaired the 2018 conference session in Hong Kong at which Mr He dropped his bombshell revelation. Prof Lovell-Badge also sits on the World Health Organization’s advisory committee on the governance of the technology, which will issue a report next year on how nations should regulate it.

“Some people will want to never allow germ line genome editing because they think it’s bad for humanity,” he told me. “That scares me. I don’t like closing and locking doors. Take global warming — we might need to modify ourselves.”

By targeting deafness, a non-lethal condition, Mr Rebrikov is in danger of attracting the same criticism as Mr He. Why edit genes to fix an issue that can be treated at birth using cochlear implants?

Moreover, the gene in question causes only mild hearing loss in some people. This gets to the heart of a delicate conversation society is failing to have: will genetic technologies eradicate disease or erase human difference? Public opinion tends to support genome editing for serious or lethal diseases; less so for what we might consider enhancement. There is dismay that, in the many initiatives set up in the wake of the He scandal, people with disabilities are not represented in the decision-making.

All the while, avenues to genetic enhancement are proliferating. A Harvard geneticist is designing a dating app to match singles based on their DNA, with the aim of banishing inherited diseases. A fertility start-up offers IVF along with “report cards” on the resulting embryos, predicting their health and intelligence using a technique called polygenic scoring. Both have been condemned as eugenics.

Who, we should ask, would covet perfect human specimens? The two countries rattling the cage on heritable genome editing seem to be China and Russia. President Vladimir Putin has spoken of how the technique may one day create super-soldiers, incapable of pain, fear or regret.

Perhaps that is the trend we should look out for when it comes to genome editing: not pushy parents pursuing the perfect prince or princess but nation states assembling armies of loyal, optimised citizens.