We are certain to hear more and more appraisals of Bernake’s tenure as Fed chairman as he approaches the end of his term. But will they use good benchmarks? We suggest measuring his performance against his claims for the Fed’s objectives and what he said the central bank could accomplish. Not surprisingly, we find that he came up short.
Read more...For a while now I have been arguing that Europe’s policies for reducing the public debts of fiscally stressed member-states can be described as a Ponzi austerity scheme. In this post I attempt precisely to define ‘Ponzi austerity’.
Read more...If a bad job market wasn’t damaging enough, the cost of paying off student loans does much more harm to the long-term prospects of young people than is commonly realized.
Read more...Yves here. This article is a portrait of official denial, which is then dutifully taken up and amplified by the media (well, not universally, but widely, as Ilargi’s post also demonstrates). It corroborates one of my pet theories: that we are at the end of an economic paradigm. The powers that be lack the will and imagination to do anything other than patch it up and put it back into operation. That simply assures more frequent breakdowns until the system is beyond repair.
Read more...I really enjoy speaking with Harry Shearer, both for his engaging manner and his thorough preparation. I also hope you’ll see fit to circulate this interview, since the more attention we can bring to this plan to legalize corporate pillage, the better.
Read more...The lead investigator in the Federal prosecution against JP Morgan has said he doesn’t think it makes sense for banks to have made bad loans.
Read more...Yves here. One of the things on our very long list of important issues we’d like to write about is the way Google, an unregulated information-screener, can dictate companies’ business models and keep information out of the public eye by how they handle search queries. Richard Smith give an example below.
Read more...I’m sure some readers will protest that comparing Jamie Dimon to Lance Armstrong is unfair. After all, Dimon is better looking than Armstrong. But this post will demonstrate that the big reason that Armstong’s reputation has crashed while Dimon’s remains largely intact is first, that bank CEOs have a powerful and largely compliant messaging apparatus in the financial media and second, that we hold sports stars to much higher standards than titans of finance and commerce.
Read more...The Financial Times story revealing that regulators in Switzerland, Hong Kong, the UK and US have starting probing foreign exchange markets, based on evidence that currency traders were rigging markets, is thin on details because the inquiries are still underway. Nevertheless, these investigations have the potential to unearth a Libor-level scandal.
Read more...If I were a still a Wall Street type, I don’t think I could have done a better job of sabotaging an effort to impose transaction taxes on big financial firms than the left has managed to do itself with lousy branding.
Read more...I’m generally very taken with Ian Welsh’s work, particularly two recent posts, A New Ideology and How to Create a Viable Ideology. He then continued with 44 Explicit Points on Creating a Better World. And I hate to say it, but the last piece was no where near as well thought out as the preceding pieces. What troubled me about his latest piece was its combination of confidence (as opposed to modesty and soliciting reactions and input) in combination with it having internal contractions and a lack of precision of language. But perhaps the biggest shortcoming was trying to finesse the question of governance.
Read more...Macrobusiness flagged a short interview with Ann Pettifor, a highly-regarded international finance expert who is the Director of Policy Research for Macroeconomics on the ABC program The Business. Pettifor argues that economists are responsible for the bias today to over-rely on monetary policy to solve problems that can only be addressed by government spending. Leaning too heavily on monetary policy to try to address weak growth simply generates asset bubbles.
Read more...How two wide boys with shady pasts snared a leading British publisher that has major political connections.
Read more...I was glad to get the chance to discuss the misnamed JP Morgan settlement on Democracy Now yesterday. It’s misnamed because it’s not a single settlement, but a series of settlements, mainly if not entirely FHFA and state actions, bundled together, plus fines. Plus as you will see soon that’s far from the only way it’s been misreported!
Read more...Yves here. Gretchen Morgenson gives an accessible presentation of why no one should feel sorry for the fact that JP Morgan is set to pay a roughly $13 billion settlement of a raft of mortgage-related liability. And she also dispatches the myth that the Department of Justice took a tough stance.
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