Yanis Varoufakis gave an energetic, pointed, and insightful talk at the INET conference in Berlin. His message was that the efforts by European authorities were misguided, in that they were seeking to ringfence individual countries, when it was the Eurozone as a whole that needs to be shored up. And he contends this can be done now without special approvals.
Read more...Yves here. While hypocrisy is hardly uncommon in official circles, it is supposed to be kept well out of public view.
Read more...By Lambert Strether of Corrente.
Some of us became aware of primatologist Frans de Waal back in 2008 through his concept of inequity aversion:
[W]e did a study in which capuchin monkeys received either a grape or a piece of cucumber for a simple task.
If both monkeys got the same reward, there never was a problem. Grapes are by far preferred (as real primates, like us, they go for sugar content), but even if both received cucumber, they’d perform the task many times in a row.
However, if they received different rewards, the one who got the short end of the stick would begin to waver in its responses, and very soon start a rebellion by either refusing to perform the task or refusing to eat the cucumber.
This is an “irrational” response in the sense that if profit-maximizing is what life (and economics) is about, one should always take what one can get. Monkeys will always accept and eat a piece of cucumber whenever we give it to them, but apparently not when their partner is getting a better deal. In humans, this reaction is known as “inequity aversion.”
That seems relevant to the great questions of political economy before us today.
Here’s a recent presentation from de Waal at Ted, that focuses on morality, altruism, and empathy, also relevant today — especially if you’re not a neo-liberal or some sort of sociopath.
Read more...By Sell on News, a global macro equities analyst. Cross-posted from Macrobusiness.
In the movie Margin Call, which is broadly about the financial crisis and the insidiousness of the financial sector, one of the characters laments about how he used to be an engineer who did useful things like build bridges (he calculates that one he built saved people thousands of years of travel time). But of course the money was better in finance. An angst about people who do useful things and financial people who just feed off everyone else, runs through the whole film. It is a neat reflection of a serious problem at the heart of the post-industrial, globalised system we are creating, which is causing serious imbalances between capital and labour and weakening middle classes in the developed world.
Read more...By Lambert Strether of Corrente.
I imagine there will be more material to come on this year’s iNet “Paradigm Lost” conference in Berlin, but for now, here’s a teaser in the form of a video of Michael Hudson’s talk.
Read more...By Lambert Strether of Corrente.
This clip from TV Asahi is a lucid explanation of the biggest ongoing news story in the world today: The catastrophic consequences if an earthquake strikes the Fukushima Dai-Ichi No. 4 power plant before its spent fuel rods are moved to safe storage place, a process that will not even begin until December 2013, and could take years. It aired March 8, 2012 on “Morning Bird,” a mainstream Japanese news and information TV program.
Read more...Lambert Stether blogs at Corrente.
Yet another market where the rule of law doesn’t apply. Check out the video from RNN:
Read more...Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on twitter at http://www.twitter.com/matthewstoller
Today, both JP Morgan Chase and Wells Fargo released their earnings, beating expectations on revenue and profit. Nonetheless, their stock prices fell throughout the day. I went through their earnings releases to see what kinds of interesting information they’ve put out relating to mortgages. Here’s the JP Morgan Chase release, and here’s the Wells release. Deposits are up at both banks (Move Your Money campaign notwithstanding), and new regulatory guidance on second liens seems to be having a very modest effect at both banks.
Read more...By Delusional Economics, who is horrified at the state of economic commentary in Australia and is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.
Sorry for the lateness of this post, one of those days I’m afraid.
Italian borrowing costs were seen rising overnight as the country moved into a second day of auctions of bonds and bills.
Of note €2.884 billion in three-year debt at a yield of 3.89% were sold. The last auction of few weeks ago came in at 2.76% so there has been a 1.1% jump in under a month. The bid to cover was also down to 1.44 from 1.56. On Wednesday Italy’s one-year borrowing costs doubled. Treasury raised €4.88 billion which was under the full allocation of €5 billion.
Although these number are way down from the heady heights of late November yields, across the Italian curve yields have been rising since the end of March. The Italian authorities, ignoring yesterday’s message from the Spanish, blamed contagion for the higher yields.
Read more...Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on twitter at http://www.twitter.com/matthewstoller
If you picked up a newspaper in DC this week, it would have been hard to avoid noticing that a bizarre and irrelevant spat is consuming much of the insider political media and top political officials. Earlier this week, a corporate lobbyist named Hilary Rosen tweeted a vague insult at GOP Presidential nominee wife Ann Romney. Rosen said that Romney had never worked a day in her life, and so could not credibly speak to the economic concerns of women. The Republicans demanded an apology. Rosen refused. Obama advisors like David Axelrod and Jim Messina then weighed in on Romney’s side. Eventually, Rosen caved to the pressure and apologized. This is why.
Read more...Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Cross posted from New Economic Perspectives.
“Pink slime” just had its fifteen minutes of fame. BPI, the producer of pink slime, calls it “Lean Finely Textured Beef.” BPI’s slogan is “expect a higher standard.” Pink slime starts with fatty tissues that are inherently more likely to be repositories of salmonella and e coli infections. The tissues are shredded and rendered and most of the fat drained off. The pink slime, however, is still more likely to be infected after this processing and that makes it dangerous and can make it smell spoiled. BPI’s “innovation” was to gas the pink slime in Mr. Clean (ammonia) to try to kill bacteria and reduce the stink. The resultant pink slime is then frozen into bricks and shipped in bulk.
Read more...Matt Stoller is a fellow at the Roosevelt Institute. You can follow him on twitter at http://www.twitter.com/matthewstoller
Last month, Yves highlighted an article on the coming fight between senior Democrat Maxine Waters and senior Democrat Carolyn Maloney over the top spot on the Financial Services Committee now that the bank-friendly Barney Frank is retiring. Maloney, of course, is the driving force behind several initiatives to deregulate Wall Street, including the JOBS Act (which Alexis Goldstein took down in Maloney’s face on Up with Chris Hayes) and a bill to get rid of a significant derivatives regulation by redefining a transparent public swaps exchange as two guys talking on the phone. Maloney as ranking member of the Financial Services Committee would be a victory for the New Democrat caucus and its banking allies. Waters, of course, carries her own baggage. She is under an ethics cloud, which had dragged on for years inconclusively (but I suspect will wrap up without consequences). She is widely hated by the financial services community, and she supported problematic policies around Fannie and Freddie in the 1990s and early 2000s.
Read more...