Category Archives: Currencies

Mr. Market is Getting Frazzled Over the Fed’s Neglect of Its Pet Wishes

A brief surge of optimism, in the form of a short-lived rally in the belegured Turkish Lira and South African rand after their central banks raised interest rates to try to halt the plunge in currency values, has fizzled. And the Fed reducing its dosage of market tonic, in the form of QE, only soured investors’ already bad mood.

Will China Stop Taper?

That is the question today. Let’s first ask markets.

Death By A Thousand Cuts: The Silent Assassination Of European Democracy

The European Union is riddled with fatal flaws and defects. Chief among them is the single currency which, rather than serving as the Union’s springboard to global dominance, could well be its ultimate undoing.

Essays in Monetary Theory and Policy: On the Nature of Money (Continued)

Yves here. I thought this essay on money was useful in and of itself, and it also contains a useful primer on the views of major schools of thought in orthodox economics.

Goodbye Price Stability, Hello Exchange Rate Volatility

Yves here. This post makes a deceptively simple but important observation. Despite claims otherwise, central banks are giving top priority to interest rate stability, over that of other mandates they have been given explicitly, such as the health of the financial system, price stability, and full employment. This is further confirmation of the idea that central banks are desperate to keep asset prices aloft.

Ragnarok – Iceland and the ‘Doom of the Gods’

Iceland is widely portrayed as a post-bubble success story, but the reality is more conplex.

Rob Parenteau: How to Exit Austerity, Without Exiting the Euro

Yves here. This is an important post by Rob Parenteau which outlines a viable plan for subject nations austerity-afflicted Eurozone countries with reasonably-well-functioning tax bureaucracies to escape their downspiral.

Yanis Varoufakis Discuses Bitcoin and Litecoin on RT

Yves here. Yanis makes a couple of observations which won’t sit well with digital currency enthusiasts.

New Zealand’s Latest Dodgy Export: Why FX Investors Should be Wary of Software Sold by Irish Company Paymark Autotrader

A dubious FX trading software operation closes down in New Zealand and sets up shop in Ireland.

Yanis Varoufakis: What Europeans Should Know About the Current Situation in Greece

Yves here. In an interview with Edward Geelhoed, Varoufakis gives an urgent, sobering picture of the conditions in Greece, which contrasts dramatically with the claims made by Eurozone politicians.

The European Balanced Budget Disaster

In the immediate aftermath of the financial crisis, most European governments allowed the automatic stabilisers to kick in and implemented some mild discretionary measures, despite the strictures of the Stability and Growth Pact (SGP). But it was not long before the siren calls for “fiscal consolidation” arose…

Steve Keen: The International Financial Architecture

In this video, Steve Keen reviews the history of Keynes’ proposed international currency, Bancor, and why it failed to come to fruition at Bretton Woods.

Wolf Richter: French Megabank – “Germany Should Leave The Eurozone”

France’s government is struggling to stay relevant….and Groupe BPCE may have provided an answer by telling Germany to pay up or exit the Eurozone.

Randy Wray: What If China Dumps US Treasury Bonds? Paul Krugman Inches Toward MMT

Our deficit hysterians love to raise the specter of China.

Regulators Opening New Major Front With Banks on Foreign Exchange Trading Probe

The Financial Times story revealing that regulators in Switzerland, Hong Kong, the UK and US have starting probing foreign exchange markets, based on evidence that currency traders were rigging markets, is thin on details because the inquiries are still underway. Nevertheless, these investigations have the potential to unearth a Libor-level scandal.