Greenspan decided to launch a frontal attack on critics of his tenure at the Fed, via a Financial Times comment, “The Fed is blameless on the property bubble.” Needless to say, his defense does not stand up to scrutiny. Greenspan was happy to take credit for the commonly-held view that central bankers were responsible for […]
Read more...Forgive me, I couldn’t resist this oddity. From the BBC: A man in New Zealand has been charged with using a hedgehog as a weapon, the New Zealand Herald has reported. Police said William Singalargh, 27, had hurled the hedgehog about 5m (16ft) at a 15-year-old boy. “It hit the victim in the leg, causing […]
Read more...As the credit crisis has worsened, regulators are increasingly abandoning their usual anodyne statements in favor of blunt assessments and plainspoken calls for action. But even in this new age of supervisory candor, the call by Dominique Strauss-Kahn, the IMF head, for global fiscal action to combat the decline in growth, reveals that the IMF […]
Read more...Private equity funds (except for specialists like Chris Flowers) seldom make investments in banks, and for good reason. They are regulated businesses with complex, integrated overhead structures that don’t lend themselves to the sort of cost cutting and breakups that are easy ways for LBO firms to unlock value. On the one hand, with sovereign […]
Read more...Central Banks are Dangerous Steve Waldman Has Anyone at the New York Times Heard of the Housing Bubble? Dean Baker Opes Prime: Collapse Down Under Michael Shedlock Subordinate monkeys more likely to choose cocaine over food PhysOrg Antidote du jour:
Read more...With America’s high current account deficit not showing much improvement. the dollar’s recent rally seemed to be based on the greenback being oversold rather than improved fundamentals. Historically, countries that run current account deficits in excess of 4% of GDP suffer depreciation of the value of their currency, and the US is still well above […]
Read more...Faithful readers (and promiscuous ones too): I’m in San Francisco through next Sunday, which means posts will be thinner than usual. If you’d like to help, please send links or text of interesting news, academic papers, and reaserch.
Read more...This is a great little piece by Thomas Palley that I wish I could discuss at greater length (but I have to be up before dawn tomorrow, eeek). Palley takes on the orthodoxy of the so-called Great Moderation, the twenty-year period we’ve just finished that featured relatively mild downturns and steady growth. Observers often attribute […]
Read more...Oooh, because I have to be on a plane at an ungodly early hour tomorrow, I do not have time to do Robert Shiller’s New York Times piece, “The Fed Gets a New Job Description.” justice. In short, I don’t agree with this mission creep by the Fed becoming official. First, as Shiller implies, the […]
Read more...US mulls Pacific salmon fishing ban BBC Road for electric car makers full of potholes LA Times Every move you make tracked by RFID tags Roland Piquepaille Credit Card Redlining Adam Levitin, Credit Slips Imagine there’s no country…. Willem Buiter. Most readers would probably regard Buiter’s idea as a bit mad, but radical challenges to […]
Read more...While there have been dark mutterings about how Bear shareholders were cheated in the sale of the firm to JP Morgan, I don’t have much sympathy for that view. Plenty of businesses fail every day; equity investors usually lose their entire stake and employees are fired. While it is sad on a human level to […]
Read more...Bank stocks enjoyed a nice bounce from the fact that UBS announced a first quarter loss equal to 5% of Switzerland’s annual GDP. The logic evidently was if things are that bad, they can’t get much worse, ergo, a bottom must be at hand. But this credit contraction has produced a number of head fakes […]
Read more...One of the hobbyhorses of the rational-choice economics types is that voting is irrational. The odds of your vote making a difference are ludicrously small, so why bother? Readers may recall that the New York Times picked up on the argument by Lloyd Cohen of George Mason Univerisity that, contrary to widely held views, buying […]
Read more...Bank of England predicts credit squeeze will tighten its grip in next quarter Guardian Foreign banks flee Spanish property debt Telegraph Sex and Financial Risk Linked in Brain Huffington Post. So now we know why markets are irrational. Should Anyone Care If Investment Banks Move to England? Dean Baker “The next time we have Black […]
Read more...Readers may recall that MBIA tried the “just say no” strategy with rating agency Fitch, trying to shut out the number three firm, obviously due to its less than charitable view of the industry (Fitch downgraded Ambac to AA while Moody’s and Standard & Poor’s maintained the sham of a top grade). MBIA requested that […]
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