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On how Portugal is the next Greece
in Markets
at January 27th, 2012 -
Stephen Roach on US, the Fed, China, and Europe
in Economy
at January 27th, 2012 -
I repeat: The Fed’s Permanent Zero rate policy is toxic
in Political Economy
at January 27th, 2012 -
Euro at the Crossroads
in News
at January 27th, 2012 -
News Links: Monetary Realism and why the Fed won’t tell the truth
in News
at January 26th, 2012
Featured News
I repeat: The Fed’s Permanent Zero rate policy is toxic
by Edward Harrison
On how Portugal is the next Greece
by Marc Chandler
Stephen Roach on US, the Fed, China, and Europe
by Edward HarrisonRecent Articles
The latest at Credit Writedowns
Hi Everyone, I just wanted to update you on the goings-on here at Credit Writedowns in the new year
On how Portugal is the next Greece
Portugal appears to be headed down that same road. While we have warned in the past of risks that Portugal would need a second aid package, it is only since S&P joined the other major rating agencies on January 13 that more market participants have come over to this view
Stephen Roach on US, the Fed, China, and Europe
Stephen Roach says the Fed is going all in in support of QE and I agree. But what else are they going to do? Look at Europe, for example. The ECB there has a hydra-headed problem with sovereigns and banks on the brink of insolvency and they too have expanded the balance sheet like mad. China faces many of the same challenges with excess credit growth and fragile financial firms in the face of asset price deflation
I repeat: The Fed’s Permanent Zero rate policy is toxic
Permanent zero can work over the medium-term but the economy is dependent on employment growth and monetary policy doesn’t drive that
Euro at the Crossroads
Dollar is broadly weaker amid hopes that Greek debt negotiations are very close to agreement. Asian stocks posted new trend highs, MSCI Asia Pacific up 0.3%; Dow Jones tested highest level since 2008. EuroStoxx 600 reverses earlier losses and is currently flat on the day; Greek banking shares up nearly 6.0%
News Links: Monetary Realism and why the Fed won’t tell the truth
MONETARY REALISM | PRAGMATIC CAPITALISM I feel that the core operational aspects of MMT are among the most important ideas in the world and my goal here has always been to help promote those ideas. Because I believe in those ideas I will not stop promoting them. So I’ve been working with Michael Sankowski, Carlos
The stark contrast between European economic policy and US economic policy
I was on CNBC yesterday ahead of Ben Bernanke’s speech explaining the FOMC’s recent decision to add an explicit inflation target to its decision to extend its rate easing/permanent zero policy. My conclusion: the Obama mortgage plan and Bernanke easing campaign are bullish for the US economy
It’s Timmy Time
This is a sing along in honor of the US Treasury Secretary
Dollar Falls on Fed, Potential Greek Debt Deal
Dollar extended losses overnight and into the European session following the Fed’s dovish policy stance. Global stocks are broadly high off the back of Fed and Greek debt deal; EuroStoxx up 0.6%, banks up 0.7%. Economic data saw German consumer confidence improve; UK’s CBI retails sale retrenched in January
News Links 01/26/2012
Roger Federer, Rafael Nadal meet in Australian Open semifinal – Bruce Jenkins – SI.com they’ve drawn distinct lines in the sand when it comes to the punishing grind of the men’s tour. Nadal, fearing his body is approaching its expiration date, wants it shortened. Federer, that model of fitness and longevity, sees no need for
Geithner tells Bloomberg that Obama will give him the sack if Obama is re-elected
I had a bet with a bunch of fellow market watchers back in early 2010 when Geithner was getting it from all sides as to how long he would last. Some people were saying he couldn’t make it through the second year. Geithner outlasted Summers, Goolsbee, Romer, and Orszag. Wow!
Will the ECB Take a Haircut?
The ECB’s hand though could be forced if there is a credit event, a non-voluntary debt restructuring. Under such conditions, it would be more difficult to show some bond holders (ECB) preferential treatment over other holders of the same bond. This warns of potential knock-on effects of a hard restructuring
Chart of the Day: Gold reacts to FOMC rate easing
The Fed has come out 9-1 in favor of rate easing i.e. capping medium-term treasury rates. The interesting bit is that while the Fed did the exact same thing in August out to two years, this announcement takes permanent zero out to nearly three years. That’s rate easing. Some people call it financial repression. And it’s gold bullish
Forecasts»
Poll: Can China avoid a hard landing?
10 January 2012 16:10-
Edward Harrison’s Ten Surprises for 2012 (short version)Yesterday morning, I did the first weekly newsletter on my ten surprises for 2012. Here’s a brief version...by Edward Harrison on 6 January 2012 08:54 -
John Mauldin: The Matterhorn InterviewBy Lars Schall Investment advisor John Mauldin explains his attitude towards austerity measures; a return of the...by Guest Author on 2 January 2012 09:30 -
On the ECB’s Long-Term Refinancing Operation and 2012 macro ideas for investorsThe end of year is usually a good time for markets. There was a lot of angst about the European situation a few...by Edward Harrison on 21 December 2011 15:30 -
The 2012 Blind Side: China’s Housing BustBy Global Macro Monitor As the world’s attention focuses on the death of Kim Jong Il and shorts keep piling up...by Global Macro Monitor on 19 December 2011 09:49
Economics»
Milton Friedman, Functional Finance and the Government Budget Constraint
23 January 2012 15:00-
Milton Friedman’s 1948 Functional Finance ProposalBy L. Randall Wray In the context of today’s conventional wisdom about the dangers of budget deficits, Lerner’s...by Randall Wray on 17 January 2012 09:00 -
Monetary and Fiscal Policy for Sovereign CurrenciesBy L. Randall Wray This week we begin a new topic: functional finance. This will occupy us for the next several...by Randall Wray on 9 January 2012 08:30 -
Krugman, Tabarrok, Cowen and the bond vigilante fallacyI don’t expect any response from Paul Krugman, Alex Tabarrok or Tyler Cowen on this but they know who I am...by Edward Harrison on 3 January 2012 16:00 -
What is Modern Money Theory?By L. Randall Wray Happy New Year to All. We are (I think) a bit over half-way through the Modern Money Primer....by Randall Wray on 3 January 2012 07:45
Financial Institutions»
Sucking up to power, Timothy Geithner edition
19 January 2012 22:36-
Has banks’ bonus culture really changed?By Finance Addict Today’s the big day at Goldman Sachs. Employees of the so-called Vampire Squid will find out...by Guest Author on 19 January 2012 13:00 -
More on the self-regulatory banking saga, SEC versionBy Finance Addict Is there any government body having a harder time of it these days than the SEC? Sometimes it...by Guest Author on 13 January 2012 15:00 -
Chart of the Day: Bank credit card fees induce big antitrust lawsuitThis story seems to be breaking out. Here’s how the Street.com puts it: Private antitrust litigation pitting...by Edward Harrison on 12 January 2012 20:30 -
Why bank deposits are piling up at the ECBBy Warren Mosler Email from JJ Lando, now at Nomura: “THE LTRO DIDN’T DO ANYTHING. ALL THE MONEY WOUND UP...by Guest Author on 12 January 2012 10:24
Housing»
Robert Shiller: “Sweden has a bubble”
17 January 2012 14:30-
Full Text: Moody’s revises rating outlook for Australian mortgage insurers to negativeBelow is the press release issued by Moody’s in conjunction with the down grade of Australia’s mortgage...by Edward Harrison on 19 December 2011 21:29 -
House Prices Plunge in Chinese Ghost CityBy Global Macro Monitor Could this be part of the reason the Shanghai was the only major index we track that was...by Global Macro Monitor on 5 December 2011 20:00
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Australia: There goes the neighbourhoodBy Steve Keen, Associate Professor of Economics & Finance at the University of Western Sydney, and author of...by Guest Author on 1 November 2011 08:00 -
Shanghai property values plunge, recent buyers protestThe Chinese property market has come off the boil according to this video from NTD Television (hat tip Global Macro...by Edward Harrison on 27 October 2011 10:30
Business»
Anti-employee Control Fraud
17 January 2012 11:00-
Nonlinear Thinking: Smartphone Ultrasound ImagingBy Global Macro Monitor Stunning! Guess it’s time for our annual physical with Dr. iPhone.by Global Macro Monitor on 12 January 2012 10:00 -
Nonlinear Thinking: The Robot FarmerIn the ongoing series of posts on technology’s threat to existing labor roles, Global Macro Monitor highlights...by Global Macro Monitor on 26 December 2011 22:40 -
Video: Walt Mossberg Reviews iTunes MatchApple has introduced a ‘music locker’ service which does away with the need to upload most of your...by Edward Harrison on 1 December 2011 16:40 -
We’re American Airlines, doing what we do bestI just received this email: Dear AAdvantage® Member, As you may know, on Tuesday, November 29, American Airlines...by Edward Harrison on 29 November 2011 14:17