The interpretations of the implications of the Riyadh-Washington pas de deux over oil production increases were surprisingly disparate, a seeming Rorschach test of sentiment about the US, Bush, and the Middle East. The papers that see themselves as US opinion leaders, namely the New York Times and the Wall Street Journal, stressed how little the […]
Read more...First we had the arguments over global warming. China asserts that it has the right to produce as much carbon per person as we do. In theory that’s fine, in practice that means a rather unpleasant planet in a hundred years or less. But those who created the mess won’t be around to suffer the […]
Read more...Steve Waldman has a typically top notch post at Interfluidity,”Let’s not write the Fed a blank check,” in which he dissects the implications of the Fed’s request to Congress to pay interest on bank reserves. Waldman explains the technical workings and the pros, and gets to the real issue. This represents a change from a […]
Read more...It’s amazing how a problem isn’t a problem until it’s presented as one on television or a respected print outlet. Never mind the fact that the cognoscenti have been worried about the possibility that the two big mortgage guarantors, Fannie Mae and Freddie Mac, were too thinly capitalized relative to their massive balance sheets. Never […]
Read more...Last year, we were less than impressed with Bush’s tightly bounded but widely touted plan to use the FHA, a traditional source of financing to low and middle income borrowers, to help salvage homeowners at risk of begin dispossessed. Note we have doubts about “rescue debtor” operations. Iin many cases, these borrowers had little to […]
Read more...Thanks for your patience. Still in LA at the Milken Conference (I feel like I have been parachuted into a Pasadena Republican/Chicago School of Economics parallel universe, although I have managed to find some fellow apostates. If I spent enough time here, I might be brainwashed (social assent is very powerful). Thus I hope you […]
Read more...Larry Summers, in “America needs to make a new case for trade,” worries, as do many others, about rising protectionist sentiments: In a world where Americans can legitimately doubt whether the success of the global economy is good for them, it will be In a world where Americans can legitimately doubt whether the success of […]
Read more...The New York Times has one of those “your tax dollars at work” stories in the form of “Costly Lesson on How Not to Build a Navy Ship.” The article recounts how the Navy set out to build a new type of vessel, “littoral combat ships,” which would become the first line of defense in […]
Read more...We wrote last year that some states were getting into the “save the homeowner” act. While states and municipalities are in theory in a much better position to implement this sort of program, their efforts as of our last sighting (November) had yielded little in the way of results. Nevertheless, the proponents hoped that the […]
Read more...Food shortages have gotten an uptick in press coverage in the last two days due to a G7 pronouncement that was curiously interpreted differently by the New York Times and the Financial Times. First, the NY Times: The world’s economic ministers declared on Sunday that shortages and skyrocketing prices for food posed a potentially greater […]
Read more...John Plender in the Financial Times offers a hit list of what he views as the obvious priorities for financial services reform and assesses the odds of them being implemented. It’s a useful exercise, but also a sobering reminder of how difficult it is to effect change in an industry that has proven to be […]
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...Because I was distracted today (houseguest, plus preparing for out of town trip), I haven’t spent as much time as I would have like on the Congressional hearings into the Bear bailout. Judging from the media reports, it seems that the assertive presentations by the perps, um participants in the deal were not met with […]
Read more...A New York Times/CBS poll found Americans the most dissatisfied they have been about their country’s direction since 1992. And two things are particularly noteworthy about the survey. First is the unhappiness was as universal as you ever see in a large-scale study, cutting across party, gender, age, and geographic lines. The second is that […]
Read more...Martin Wolf takes a discursive route to make a fairly straightforward observation: no matter how the US deals with its debt hangover, the consequences are likely to be contractionary. But a rapid move to a sustainable savings rate (6%? 10%?) would produce tremendous dislocations. Hence, the public sector will throw sand in the gears, which […]
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