Category Archives: Globalization

Greece: Dead Man Walking?

I’m mystified as to the cheerleading in some circles on Greece. It is not clear that its €45 billion EU-IMF band-aid will be deployed (among other things, it faces a legal challenge in Germany) and even if it is, it falls well short of Greece’s anticipated needs beyond one year. More important, a successful deal […]

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Pharmaceutical Companies Risking Drug Safety Via Cost Controls?

Reader Francois T sent this by e-mail: It is a well known (self-serving) assumption among business leaders that management is a “special skill” that can be applied to pretty much any field. Alas, this, ahem, skills set seems to bring the bad attitudes also. Problem is, this can become deadly for their costumers when those […]

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Marshall Auerback: Troubles in the EuroZone – Will the Contagion Affect the U.S.?

By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. A recent poll by Douglas Schoen and Patrick Caddell suggests that swing voters in the US, who are key to the fate of the Democratic Party, care most about three things: reigniting the economy, reducing the deficit and creating jobs. […]

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Was Greece Rescue Futile, and is Portugal Next?

We met last week with a savvy German investor, one who unlike many of his peers, is well aware of the German bank exposure to Greek and other Club Med debt. He argued that Greece will default within six months. That view might have seemed extreme a week ago, but as Wolfgang Munchau points out […]

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Satyajit Das: New & Old Greek Lessons

By Satyajit Das, a risk consultant and author of Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives Contained Again… The language is reminiscent of the start of the sub-prime mortgage problems. The problem is “small” and “contained”. Despite the “solution” announced by the European Union (“EU”), the problems of Greece […]

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Auerback: The PIIGS Problem: Maginot Line Economics

By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. The Maginot Line, named after French Minister of Defense André Maginot, was a line of defenses which France constructed along its borders with Germany and Italy after suffering appalling damage and casualties during World War I. The French thought they […]

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Geither Defers “Currency Manipulator or Not” Determination on China

As expected, Treasury has put off a decision on whether to label China a currency manipulator for a few months, pending negotiations with China. The problem is, however, is that China has been signaling that it is pretty non-negotiable (yes, there has been the occasional conciliatory remark, but they have been notably few and far […]

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Why the fall in the savings rate means something

A post by Edward Harrison Recently, I wrote a post which examined three different reasons the savings rate in the US could have been falling over the last year. Rebecca Wilder thinks this is a meaningless exercise: Edward Harrison at Credit Writedowns is theorizing why the saving rate is falling when it should be rising, […]

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China’s Debt Bubble: When Will the Ponzi Unravel?

Independent Strategy’s latest report, “China’s credit bubble: the missing piece in the jigsaw” makes a persuasive case that China’s debt fueled growth model is due for a hard landing, but the timing is uncertain, since the debt is funded internally. China is barely past an episode of dealing with banks chock full of bad loans […]

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Auerback: Greece and the EuroZone: Angie, Ain’t it Time to Say Goodbye?

By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. Arthur Conan Doyle’s literary creation, Sherlock Holmes, once solved a murder by noting the dog that didn’t bark. It doesn’t take Holmes’s ingenuity to see that the plan on offer for Greece is clearly a rescue package which doesn’t rescue. […]

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High Income Disparity Leads to Low Savings Rates

Andrew Dittmer, who was an important collaborator on ECONNED, sent me pdfs of the notorious Citigroup Plutonomy reports for leisure reading. Michael Moore highlighted these two research reports (2005 and 2006) in Capitalism: A Love Story . On the one hand, the authors, Ajay Kapur, Niall Macleod, and Narendra Singh get some credit for addressing […]

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Entering a New Mercantilist Era?

While we have enjoyed a period of relative calm after the 2007-2008 financial crisis, the improvement in economic conditions exists in parallel with growing geopolitical tensions. None of the causes of the crisis have been resolved. We still have global imbalances. We still have powerful, predatory, and unconstrained capital markets players firmly in control of […]

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China Expects to Announce Trade Deficit for March

A story in China Daily indicates that the Chinese offiicaldom foresees a record trade deficit for March: The country will probably see a “record trade deficit” in March thanks to surging imports, Minister of Commerce Chen Deming said on Sunday, while warning that Beijing will “fight back” if Washington labels China a currency manipulator. Speaking […]

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