Author Archives: Edward Harrison

About Edward Harrison

I am a banking and finance specialist at the economic consultancy Global Macro Advisors. Previously, I worked at Deutsche Bank, Bain, the Corporate Executive Board and Yahoo. I have a BA in Economics from Dartmouth College and an MBA in Finance from Columbia University. As to ideology, I would call myself a libertarian realist - believer in the primacy of markets over a statist approach. However, I am no ideologue who believes that markets can solve all problems. Having lived in a lot of different places, I tend to take a global approach to economics and politics. I started my career as a diplomat in the foreign service and speak German, Dutch, Swedish, Spanish and French as well as English and can read a number of other European languages. I enjoy a good debate on these issues and I hope you enjoy my blogs. Please do sign up for the Email and RSS feeds on my blog pages. Cheers. Edward http://www.creditwritedowns.com

MMT: The accounting of government budget deficits

Edward Harrison here with a Modern Monetary Theory-inspired post. Econ 101 Imagine you and I are the only two people in an economy. For the sake of argument, say we use sea shells as a currency and we trade with no one else but each other. So when we do trade, we exchange goods and […]

MMT: Fear of Hyperinflation

An article by Edward Harrison originally posted at Credit Writedowns. I am 100% sure that the U.S. will go into hyperinflation. Not tomorrow, but the problem with the government debt growing so much is that when the time will come and the Fed should increase interest rates, they’ll be very reluctant to do so and […]

The Age of The Trader

This is a post which I originally published at Credit Writedowns earlier today. I have written a number of posts which point to a shift in the center of power on Wall Street from the client-facing advisory business to the market-making trading business. I think understanding this shift is vital to understanding what caused the […]

Separating economics from politics

This is an updated version of a post which I originally wrote at Credit Writedowns. Regular readers know that, while I have a little of what Marshall Auerback calls deficit terrorism in my DNA, I fully support fiscal stimulus as a means to arrest a deep downturn. The horrendous Keynesian nightmare My move into Keynesian […]

Goldman’s public purpose and problems with the Abacus deal

This is a post I wrote earlier today at Credit Writedowns. As I said yesterday, investment banks are institutions which do fulfil a useful role in society. I would define their role as companies where large institutions and governments receive financial advice and raise capital. Goldman Sachs is an investment bank. As such, Goldman must […]

The inevitability of Greek default

A version of this post appeared yesterday at Credit Writedowns. I am running a poll on whether Greece will default. Please click here to vote. And feel free to comment on why you voted as you did. German Chancellor Angela Merkel is feeling pressure to force German banks to take a haircut on Greek debt […]

The Greek Crisis Has Me Thinking About 1931

This post originally appeared at Credit Writedowns. The news about Greece’s bailout has me thinking a lot about Creditanstalt, the Austrian bank which collapsed in 1931. This account bears remembering because we should see the 1929-1933 descent as a two-part episode, with the second part starting in the Spring of 1931 with Creditanstalt. It should […]

Jeremy Grantham on Bubbles

Bubbles are important for the country because there is nothing more dangerous and damaging to an economy than a great asset bubble that breaks. And this is something the Fed never seems to get. … We looked back as far as we could, [of the 34 bubbles we found over the years], 32 have moved […]

JPMorgan gets paid to borrow $271 billion

We know that JPMorgan is not substantially increasing lending anytime soon. And we also know that banks are recapitalizing courtesy of a steep yield curve and near zero rates, what I would call free money. What I didn’t know is how free these funds truly were. An investor friend pointed out something curious buried deep […]

Strategic defaults increase consumer spending

At the end of last month I proffered three potential explanations for the continued fall in the US savings rate. The first explanation was that the economy was in a cyclical recovery predicated on asset price inflation and this gave enough troubled debtors breathing space to spend more freely. The second explanation was the opposite, […]

The Origins of the Next Crisis

William White, the former chief economist at the Bank of International Settlements (BIS) gave an important speech at George Soros’ Inaugural Institute of New Economic Thinking (INET) conference in Cambridge. While everyone is casting about for the one magic bullet solution which would have prevented this and future crises, he placed the blame for the […]

Soros, Galbraith and Stiglitz on resisting inevitability in Greece

Yves is holed up at the Institute of New Economic Thinking (INET) conference in Cambridge. The effort, sponsored by George Soros, is a much needed collaboration of ideas to help prevent a crisis like the one we are now experiencing. She claims they are working hard of course. Hence, her lack of posts. Marshall Auerback […]

Links 4/10/10

Yves Smith Watch: These two posts are MUST reads for anyone concerned about derivatives, systemic risk and regulation. And Yves is mentioned in both! Brooksley Born Raises an Important Question, But Answers are Weak FireDogLake (hat tip Beverly) The Magnetar Trade: How One Hedge Fund Helped Keep the Bubble Going ProPublica (hat tip John) Debt […]

Reader Notice

Dear Patient Readers, Yves has told me that she has had NO internet connection at the the Institute for New Economic Thinking conference in Cambridge until just recently. She really should be spending time in the sessions – which is why she hasn’t posted yet. She has informed me that she may be able to […]

Links 4/9/10

Yves is still hobnobbing with some pretty smart people over in Cambridge. So I am going to take another crack at the links, this time with your help. Thank you NC readers for the many Antidotes and links. I actually have more of both than I can publish. Still feel free to drop me a […]