At least in the US, the Fed rate cut yesterday crowded out most other financial news. As the Wall Street Journal’s MarketBeat blog put it (hat tip Paul Kedrosky): Lehman Brothers probably could have reported that it was shutting down operations and moving to Kazakhstan and the Fed move would have still inspired a rally. […]
Read more...The Treasury department has been struggling to persuade China to let the yuan appreciate (the Chinese now engage in a dirty float in place of their former hard peg). Congress has threatened to impose trade sanctions if the Chinese do not let their currency float. However, the Chinese do not take kindly to threats, and […]
Read more...Alan Greenspan made the mistake of resorting to a tired and increasingly ineffective move from the Bush playbook. Specifically, tell a big lie long and loudly enough, and quite a few people will come to believe you. But in Greenspan’s case, this tactic may be backfiring. Greenspan seems to have forgotten that some of the […]
Read more...In today’s Financial Times, Willem Buiter, professor of political economy at the London School of Economics, and and Anne Sibert, professor of economics at Birkbeck College, University of London, take stock of the impact of the Northern Rock bailout on the Bank of England’s reputation. The article points out various dimensions on which the Bank’s […]
Read more...Bloomberg has a good piece today contrasting Bernanke’s and Greenspan’s problem solving styles. But reading it set off a flash as to where their real difference lie. We’ll review Bloomberg’s take and then mine. The Bloomberg piece, “Bernanke Spurns Greenspan Quick Fix, Seeking Data, Deliberation,” is a flattering bit of reporting. It tells us that […]
Read more...This story, on the Chinese successfully making a cyber attack on the Pentagon, is admittedly a bit wide of the subject matter of this blog, but it’s a major story that the Financial Times seems to have broken. I don’t see it on the New York Times, Wall Street Journal, CNN or Bloomberg sites. Bizarrely, […]
Read more...The Wall Street Journal, in “Bush Moves to Aid Homeowners,” reports that today the President will set forth a program to help stressed borrowers at risk of losing their homes. Main elements: Allowing the FHA to guarantee loans to borrowers who are at least 90 days behind on their mortgages but still living in their […]
Read more...Frankly, this is pathetic. If Bernanke and his minions can’t take the heat of some well-deserved criticism from the highly-regarded Martin Wolf of the Financial Times, they don’t belong in public service. To recap: yesterday, Wolf issued a stinging rebuke of Bernanke’s conduct on the Financial Times editorial page, in “Central banks should not rescue […]
Read more...It must be miserable to be a central banker these days. Not only are they confronted with the worst mess in at least a generation, but too many interested parties, from the financial services industry to politicians and some members of the media, expect them to deliver the impossible, namely status quo ante. The reassessment […]
Read more...Oh, I do so enjoy it when the Financial Times’ chief economics editor, the normally measured and thoughtful Martin Wolf, works himself into a lather. Wolf blasts what he reads as the Fed’s vow of last week, uttered by Senate banking committee chairman Christopher Dodd, to keep the markets afloat (Dodd’s exact words were that […]
Read more...Has Roubini gone to the Dark Side? Nouriel Roubini, normally the voice of prudence, makes a marked shift in his latest post, “Fiscal versus Monetary Solutions to the Subprime Crisis. ” He sympathizes with those like Bill Gross of Pimco who call on the federal government to rescue mortgage borrowers at risk of losing their […]
Read more...Earlier this week, I sought to frame the prevailing views of what the supervising adults, namely central bankers, should do about the turmoil in the financial markets. They break down into four groups (names of representative spokesmen included): The keep the party going types (Jim Cramer and his less histrionic brethren) who argue that markets […]
Read more...One of the Treasury Department’s big campaigns has been to put pressure on the Chinese to allow the yuan to float more freely (the Chinese now engage in a dirty float in place of their former hard peg). Most analyses of the value of the yuan show it to be undervalued, some by as much […]
Read more...Help me, please, I shouldn’t be wasting my time and energy on such a hopeless cause, but the spectacle of the President of this country uttering patent nonsense to justify our continued occupation of Iraq is more than I can bear to watch. So forgive me for venting a bit. The latest misrepresentation of facts […]
Read more...The Bush Administration, which resisted proposals to have Fannie Mae and Freddie Mac buy more mortgages to alleviate stress in the housing markets, is instead looking to the Federal Home Administration, which traditionally has provided insurance to low and middle income mortgages, to help troubled borrowers. But if you believe the data in the Wall […]
Read more...