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 […]
Read more...William White, the former chief economist at the Bank of International Settlements (BIS) gave an important speech at George Soros’ Inaugural Institute of New Economic Thinking (INET) conference in Cambridge. While everyone is casting about for the one magic bullet solution which would have prevented this and future crises, he placed the blame for the […]
Read more...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 […]
Read more...By Gonzalo Lira, a novelist and filmmaker (and economist) currently living in Chile Critics of free-market capitalism, especially of the Marxist persuasion, love talking about its “systemic contradictions”. Especially European critics—they adore using that steam-roller phrase: “systemic contradictions”. It sounds so thrillingly lapidary, so discussion-ending, so terminal. Nothing can escape its grasp, or the base […]
Read more...A post by Edward Harrison Michael Pettis is out with another great piece on the likelihood that non-performing loans (NPLs) will rise in China when the present spate of malinvestment comes a-cropper. What caught my eye were his statements about the hidden ways in which government pays for bank recapitalization in order to deal with […]
Read more...A post by Edward Harrison. Earlier today, I had a brief e-mail exchange with Marshall Auerback in which I said that I had basically thrown in the towel on US (and global) policy makers. Early on in this crisis, I had advocated a number of policy paths which I think would have been infinitely superior […]
Read more...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, […]
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. Wide swaths of families, businesses, investors, taxpayers, and others have had not just their net worth but their lives […]
Read more...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. […]
Read more...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 […]
Read more...The widely-extolled idea, that the EU would find a way to muddle through the Greece crisis, looks very much in doubt. The pressure has not simply put the rescue of Greece into disarray, but appears to have led to some positions being taken that, if they hold, could lead to the partial dissolution of the […]
Read more...I don’t mean to beat up on Spencer at Angry Bear, who has provided an interesting set of comparisons on the perennial question of many investors, “Whither the stock market?” But one section of his discussion, precisely because it is such conventional thinking, is an illustration of how the blind pursuit of “maximizing shareholder value” […]
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 who writes at New Deal 2.0 After a slugfest on fiscal deficits, I find that the question of hyperinflation now demands an answer. And here it is: fiscal deficit spending may be […]
Read more...The Financial Times’ Martin Wolf gives a cogent and sober assessment of what he deems to be a destructive refusal to adjust policies on behalf of the world’s two biggest exporters, China and Germany. The problem is that both simultaneously want to have their cake and eat it too. As we stressed in a recent […]
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 This 2009 analysis by UBS, presented in FT Alphaville, debunks a central tenet of the deficit terrorist camp: If the deficit terrorists were correct, there should be a much more defined population […]
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