Author Archives: George Washington

About George Washington

George Washington is the head writer at Washington’s Blog. A busy professional and former adjunct professor, George’s insatiable curiousity causes him to write on a wide variety of topics, including economics, finance, the environment and politics. For further details, ask Keith Alexander… http://www.washingtonsblog.com

Guest Post: Krugman Says American Economy Will Not Recover for a Long Time, Johnson Says “Crisis is Just Beginning”

Last week, Pimco’s CEO said that he doesn’t think we’ll have a v-shaped recovery, and that economists, advisors and managers who have been counting on a v-shaped recovery are ignoring the economic fundamentals in our economy. Now, Paul Krugman is agreeing: Plunging prices of houses and CDOs … don’t produce any corresponding macroeconomic silver lining. […]

Guest Post: Find a Local Credit Union and Assess Its Safety

In support of Huffington Post’s call for people to move our money from the giant banks to community banks and credit unions: Here is a site which lets you find local credit unions Here is a site which rates the safety of banks, thrifts and credit unions And here is another site which rates the […]

Guest Post: Economist Says Health Care Bill “Is Just Another Bailout Of The Financial System”

It is obvious that many republicans oppose the proposed health care bill. But many liberals and progressives oppose it as well. For example, economist L. Randall Wray writes: Here’s the opportunity, Wall Street’s newest and bestest gamble: there is a huge untapped market of some 50 million people who are not paying insurance premiums—and the […]

Guest Post: Princeton Economist and Computer Scientists Show that Derivatives Are Inherently Vulnerable to Fraud

By Washington’s Blog. As I have previously noted, credit default swaps are destabilizing for the economy. See this. And the models used to evaluate financial instruments – such as the Gaussian copula formula for CDOs – are inherently flawed. Now, Princeton University economists and computer scientists have demonstrated that financial derivatives are also inherently vulnerable […]

Guest Post: The Real Reason Newspapers Are Losing Money, And Why Bailing Out Failing Newspapers Would Create Moral Hazard in the Media

By Washington’s Blog. Conventional wisdom is that the Internet is responsible for destroying the profits of traditional print media like newspapers. But Michael Moore and Sean Paul Kelley are blaming the demise of newspapers on simple greed. Michael Moore said in September: It’s not the Internet that has killed newspapers … Instead, he said, it’s […]

Guest Post: Economists Are Trained to Ignore the Real World

By George Washington of Washington’s Blog. As I have repeatedly noted, mainstream economists and financial advisors have been using faulty and unrealistic models for years. See this, this, this, this, this and this. And I have pointed out numerous times that economists and advisors have a financial incentive to use faulty models. For example, I […]

Guest Post: Any Climate Treaty Which Does Not Dramatically Reduce Soot Is Not Worth the Paper It’s Written On

Note to NC Readers: This essay deals with cost and benefit. As such, it is relevant to business and economics. Preface: I studied global warming at a top university in the early 1980’s. I was taught – as Al Gore was taught in college – that temperatures are directly correlated with CO2 levels. This essay […]

Guest Post: The Fed’s “Independence” Argument Is False

The House has passed a bill to audit the Federal Reserve. 79% of the American people support a full audit. In response, the Fed says that an audit would interfere with its “independence”. However, the Constitution does not empower a central bank. And Congress – which created the Federal Reserve in 1913 and which has […]

Guest Post: Larry Summers Is Like a Guy Who Yells That the Sun Really DOES Revolve Around the Earth and that the Current Orbit is Just a Temporary Aberration . . . and That If We Just Wait a Little While, “Everything Will Return to Normal”

Two leading White House economic advisors – Larry Summers and Christina Romer – are giving very different views on the economy. As Fox news summarizes: “Everybody agrees that the recession is over,” said Larry Summers, director of the National Economic Council. “Of course not,” countered Council of Economic Advisers Chairwoman Christina Romer in a separate […]

Guest Post: House Passes Bill to Audit the Fed

I have just received confirmation from a very credible Congressional source that the bill to audit the Federal Reserve is included in the House financial reform legislation which passed today. My source says: The Fed audit provision which passed the Financial Services Committee a few weeks ago is part of the bill. This is a […]

Guest Post: Are Food Stamps the Soup Lines of this Great Recession?

Bloomberg notes that, as of 2007: In Missouri, about 100 percent who were eligible [for food stamps] that year took advantage of the program, the highest rate in the nation, followed by residents of Maine and Michigan, at 91 percent and 89 percent, respectively … Things have gotten much worse since 2007: As the New […]

Guest Post: Head of California’s Cap and Trade Offsets Program: Cap and Trade Won’t Work for Climate, It’s a Scam

Paul Krugman argues that cap and trade worked to reduce sulfur dioxide and stop acid rain, and so it will work to reduce C02. However, two EPA lawyers with more than 40 years of cumulative experience – including the guy who has been head of California’s cap and trade offset programs for more than 20 […]

Guest Post: Woman Who Invented Credit Default Swaps is One of the Key Architects of Carbon Derivatives, Which Would Be at the Very CENTER of Cap and Trade

As I have previously shown, speculative derivatives (especially credit default swaps or “CDS”) are a primary cause of the economic crisis. They were largely responsible for bringing down Bear Stearns, AIG (and see this), WaMu and other mammoth corporations. According to top experts, risky derivatives were not only largely responsible for bringing down the American […]

Guest Post: Questions for Bernanke’s Senate Confirmation Hearing

The Senate Banking Committee will be chatting with Ben Bernanke this Thursday to vote on his reappointment. Demand that the Committee ask the following questions for our esteemed Esteemed Chairman (and contact your own Senators also and demand that they find out the answers to the following questions). If you are a Senate aide, please […]

Guest Post: The Tax Code ENCOURAGES Leverage

Among the most prophetic voices prior to the economic crash was UCLA economics professor Harold H. Somers, who warned in 1991 that revisions to the tax code would increase leverage, which could lead to economic disaster: The result is to tilt the well-worn playing field even more in favor of leveraging, leading to the possibility […]