Happy Monday. It was a fairly slow news day actually. But that doesn’t mean there weren’t a lot of stories to follow on economics and finance, because there were a lot. I am officially stopping the Madoff madness and moving on to something else. But I actually do have one story on Bernie today.
Stories that I really want to pint out? There’s the German-British political mess wich is leaking out into currency markets. This basically boils down to a debate between Austrian-style economics and Keynesian economics. So, I have a whole section on this.
To stimulate or not? (Mises or Keynes?)
The Germans say no to stimulus and Munchau chimes in FT.com / Columnists / Wolfgang Munchau – Complacency rules as time slips away
This Frenchman at the ECB is on the side of te Germans. FT.com / In depth – Trichet warns of fiscal indiscipline
Krugman chimes in to to give his defense of Keynes Paul Krugman – European Crass Warfare – NYTimes.com
On the other hand, we have Tim Iacono to defend the hard money, fiscally conservative crowd. The Mess That Greenspan Made: Keynesian Economics Is Wrong
And let’s throw Tim Duy via Mark Thoma into the mix here. Economist’s View: Fed Watch: What If the Analogy is Wrong?
But, where does deficit spending lead? BradSetser tackles that question in a thoughtful piece. Brad Setser: Follow the Money – This is what a crisis looks like in the balance of payments data
But of course it also leads to a weak dollar. Bloomberg.com: Dollar Staggers as U.S. Unleashes Cash Flood, Deficit
And since the Brits are doing the same it leads to a weak Pound. Sterling hits record low against the euro – Times Online
Onto another topic, as I have said, writedowns are coming for the likes of Alt-A mortgages just like sub-prime before. Fitch: Alt-A Mortgages Deteriorating More Rapidly than Expected : HousingWire
I may have more to say about this later. November industrial production dips 0.6 percent | Reuters
The king of political patronage for the Wall Street crowd. Schumer, a Defender of Wall St., Reaps Benefits — DealBook – New York Times
Don’t you love politics? Limits on Executive Pay May Prove Toothless – washingtonpost.com
I told you I still had another Madoff missive in me. This one actually runs down financial companies’ exposure to Madoff. The List of Losers in the Madoff Case – DealBook – New York Times