OK, that isn’t what Wolfgang Munchau said in his Financial Times article today. His piece, “The princess’s cake gets an added crunch,” starts with the theory that inflation and our asset bubbles were ultimately monetary phenomena. While the rest of Munchau’s piece, which focuses on why we should be worried about inflation, is useful, I […]
Read more...Henry Kaufman, aka Dr. Doom in his heyday as Salomon’s chief economist when the firm was at the peak of its power, argues in “Finance’s upper tier needs closer scrutiny,” that the very biggest financial institutions need a regulator with the savvy and reach to supervise them effectively. Kaufman put the number at roughly the […]
Read more...Bloomberg gives us a pretty downbeat assessment from the Government of Singapore Investment Corp. (note that Singapore has two sovereign wealth funds, the other being Temasek): Government of Singapore Investment Corp., a sovereign wealth fund that manages more than $100 billion, said the world economy may be facing its worst recession in three decades as […]
Read more...Captive tigers ‘may save species’ BBC. It’s better for the tiger to be saved than not (they breed well in captivity) but sad that they are on their way to being zoo and game preserve curiosities. Book by metallurgists blames rivets for Titanic tragedy PhysOrg House price falls won’t send the UK into a recession […]
Read more...Carmen Reinhart has provided a synopsis of a paper she did with Kenneth Rogoff looking at financial crises over a longer time frame than most analyses, which have limited themselves to recent history (the economist’s version of the drunk looking under the street light for his keys because that’s where the light is good, as […]
Read more...I am probably going to get myself in a heap of trouble with this one, but I am responding to a reader’s request. I left a comment on another blog and have been asked to elaborate on it. Yesterday, I featured and commented upon a post by Willem Buiter, in which he ‘fessed up that, […]
Read more...Now that the credit markets for the moment have been moved out of intensive care, some commentators have shifted their attention away from “what should the powers that be do to prevent a meltdown” to the broader question of “what can we do to prevent this sort of mess from happening again?” Dani Rodrik, in […]
Read more...‘Mortgage holidays’ for hard-up homeowners Guardian. Now it’s the UK’s turn to contemplate desperate measures to save underwater borrowers Citigroup May Need to Sell Assets to Bolster Capital Bloomberg McCain Does Not Want Free Market Health Care Dean Baker Are Markets Leading or Lagging Indicators ? Barry Ritholtz Too many choices may not be good […]
Read more...It’s remarkable how attending an industry love-fest can distort one’s perception. The Economist seems to have fallen hook, line, and sinker for International Swaps and Derivatives Association view that counterparty risk in the credit default swaps market isn’t all that big an issue. Its article, “Clearing the fog.” while mentioning the little problem that led […]
Read more...Man hypnotises himself before operation BBC. As in “Look Ma, no anaesthetic!” Financial crisis forces Britons into austerity Telegraph Cat Desktop Bed Is a Good Idea, But Cats Will Never Go For It Gizmodo (hat tip Kevin Drum). This is really unnecessary. Contrary to public opinion, cats can be trained to stay off keyboards (although […]
Read more...John Authers of the Financial Times uses Passover as a pretext for discussing four perplexing questions related to the markets. They’ve been bugging me too, so I appreciate him having a go at them. From the Financial Times: Passover starts tonight. The world’s Jews gather to commemorate the Hebrews’ flight from Egypt and eat a […]
Read more...With all the cheery talk about how our credit crisis is a thing of the past, mortgage rates, as reader Scott reminds us, are moving up again. From his message: You’ll recall that some time over the last month or so, bullish commentators noted that with mortgage rates falling, resets of ARMs were no longer […]
Read more...We have the rare spectacle of Willem Buiter admitting he doesn’t have an answer, but in fairness, he is looking at a throny problem. Buiter considers the question of what to do about the financial sector once the crisis has passed. He provides a scathing assessment of the workings of financial capitalism, but is pessimistic […]
Read more...On a post yesterday on how well (or more accurately, how badly) various state efforts to rescue homeowners were faring, reader Richard Kline offered a suggestion. Note that while I still favor the apparently destined-never-to-see-the-light-of-day idea of permitting bankruptcy judges to write down mortgages to the current market value of the collateral (the rest becomes […]
Read more...Morgan Stanley predicts one in ten homeowners ‘facing negative equity’ Times Online I underestimated the threat, says Stern Guardian Why new oil price highs? James Hamilton, Econbrowser. A nice little post. Hamiltion looks at some data, most importantly that all commodity prices are increasing, and the oil price rise is less than the average. He […]
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