The New York Review of Books has an article by George Soros with his take on the challenges facing the Eurozone. It includes a good, high level recitation of the structural deficiencies in the Eurozone (in particular, its lack of a treasury), the evolution of recent stresses, and suggested remedies. While the initial discussion covers […]
Read more...Look, I love the Financial Times, but even the pink paper has its off moments. Today, the FT reports, with the journalistic equivalent statement of a straight face, a patently ridiculous statement from China’s State Administration of Foreign Exchange: China has delivered a qualified vote of confidence in the dollar and US financial markets, ruling […]
Read more...By Willem Thorbecke, Senior Research Fellow at the Asian Development Bank Institute and a Consulting Fellow at Japan’s Research Institute of Economy, Trade, and Industry, originally posted at VoxEU Yves here. As we have pointed out in several posts, the idea that China’s announcement on its currency policy change is “abandoning its dollar peg” is […]
Read more...The alert John Dizard of the Financial Times has taken notice of a development that has passed most commentators by, namely, that Greece is starting to restructure state debts. This hasn’t yet gotten the attention it merits because it’s bonds issued by particular government bodies (in this case, the Greek state hospital system) and the […]
Read more...By Marshall Auerback, a portfolio strategist and fund manager Wolfgang Munchnau is right. Only a closer union can save the euro. In the longer term, it will be necessary to put in place a permanent fiscal arrangement through which the central euro zone authorities distribute funds to be used by member nations. Ideally this should […]
Read more...We and other cynics were very skeptical of the pre-G20 announcement by China that it was moving to a more market-oriented currency regime at some unspecified point in the future (particularly since China had said pretty much the same thing in 2005, and actually had committed to some baby steps then). Now that it is […]
Read more...We’ve warned for some time that the eurozone’s sure-to-fail muddle-through approach to its structural challenges was rattling investor confidence. Worse, its insistence on wearing an austerity hairshirt was not only committing Europe to deflation, but had high odds of sucking the global economy down along with it. Given how fragile the recovery is in advanced […]
Read more...By Rob Parenteau, CFA, sole proprietor of MacroStrategy Edge, editor of The Richebacher Letter, and a research associate of The Levy Economics Institute Richard Alford has correctly identified the need to address global imbalances – rather than simply slouch our way back to some milder version of status quo before the pre- Lehman meltdown arrangement, […]
Read more...We noted a bit more than a week ago that we expect the European banks stress tests to backfire. The US version was a successful con game because the officialdom provided adequate disclosure about the process and stayed firmly on message, the banks were allowed to “manufacture” as analyst Meredith Whitney put it, impressive earnings, […]
Read more...The first section of this post is by Warren Mosler, the President of Valance Co. who writes for New Deal 2.0 Deficit doves are doing more harm than the hawks — here’s what they need to know. The deficit hawks are prevailing. The economy remains an economic and social disaster. Medicare has already been cut […]
Read more...George Magnus, senior economic advisor at UBS, provided a reading of the Chinese central bank’s announcement on its currency policy over the past weekend. He sees it as political, “symbolic rather than substantive.” He also contends that China needs to make significant policy changes. From the Financial Times: It would be churlish not to acknowledge […]
Read more...By Richard Alford, a former economist at the New York Fed. Since then, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side. Calls for global rebalancing are back in vogue, while the debate about the appropriate stance of domestic policy heats […]
Read more...The Chinese central bank made a vague announcement about its currency policy on its website today, which the officialdom, on cue, treated as a major move (to wit: “China vows increased currency flexibility” at the Financial Times, “Chinese say they intend to free up their currency,” Washington Post).) As we describe below, this “announcement” is […]
Read more...This post appeared as an op-ed in Mint, India’s second largest business newspaper. The financial market upheaval that started in May is a stark reminder that the conditions that produced the global financial crisis of 2007-08 have not been resolved. The sucking sound of deflation emanating from Europe and the creaking of bank balance sheets […]
Read more...Tonight brings an odd pairing: Lord Skidelksy, the highly respected biographer of Keynes, and Ambrose Evans-Pritchard, who is generally of the Austrian persuasion, both continuing, as each has, to object to the extreme measures in the process of being implemented in the eurozone. Now before you say that they are both Brits, and therefore suspect […]
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