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.
Read more...Iceland is widely portrayed as a post-bubble success story, but the reality is more conplex.
Read more...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.
Read more...Yves here. Yanis makes a couple of observations which won’t sit well with digital currency enthusiasts.
Read more...A dubious FX trading software operation closes down in New Zealand and sets up shop in Ireland.
Read more...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.
Read more...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…
Read more...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.
Read more...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.
Read more...Our deficit hysterians love to raise the specter of China.
Read more...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.
Read more...If I were a still a Wall Street type, I don’t think I could have done a better job of sabotaging an effort to impose transaction taxes on big financial firms than the left has managed to do itself with lousy branding.
Read more...As Lambert says, get a cup of coffee, or maybe two. This is a long piece, but that is in part because it includes many damning vignettes from the Eurocrisis, so this is the antithesis of a dry read.
Read more...Just because a taboo has been broken does not necessarily mean that more radical action is in the offing. But the flip side is that, while we’ve been busy following debt ceiling and budget hijinx in the US, there are some surprising developments on the other side of the pond. One is that, as anti-Euro candidate Marine Le Pen is leading in polls in France, respected members of its ruling bureaucracy are deeming the Euro as a failed experiment and presenting detailed plans as to how an breakup could be executed.
Mind you, the Eurozone has been limping from crisis to crisis for so long that it’s hard to take new signs of trouble seriously.
Read more...Yves here. This post by Michael Bordo and Howard James finds significant parallels between the 1920s and the economic and policy conflicts facing the Eurozone, which does not speak well for them being resolved tidily.
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