This Week’s Most Popular Posts: 2010-10-23

By Edward Harrison On Oct 24, 2010

We had a lot of good posts at Credit Writedowns this past week. Below is a list of the most-read. Enjoy.

Chile: "We are very much concerned about what’s happening with our currency": Comments by Chile’s central bank vice-governor demonstrate that the so-called ‘currency war’ is still very much an issue. Chile is concerned that as the US dollar falls, the brunt of currency adjustments is falling on countries like his because of China’s peg and currency controls.
Simon Johnson: The Coming Meta-Boom and Meta-Bust: A two-part video with Baseline Scenario’s Simon Johnson which runs 40 minutes. In the video, Johnson says regulatory reform has been inadequate and that the pre-conditions for another large boom-bust cycle still exist.
The #1 Reason Why Gold Collapsed: Gold suffered a large one-day drop. Here Adam Hewison explains the technical factors behind it.
Blanchflower: The Fed Should Buy Munis And Monetize State Debt: Former BoE central banker Blanchflower points to buying non-Treasury assets as a better way forward for quantitative easing. The Federal reserve could buy municipal bonds without Congressional approval.
The Future of Facebook: Casey Research raises privacy concerns about the future of Facebook and other large Internet players.
QE2 Won’t Save Our Sinking Ship: Randall Wray argues that another round of quantitative easing will not rescue the US economy anymore than the first one did. His essay explains why.
What I didn’t say on the BBC: I argue that there is no way around the deleveraging that faces the US and the UK. Attempts to prevent the damage are likely to lengthen and worsen the crisis. Stimulus is warranted only as a means of sustaining some aggregate demand in the face of a needed rebalancing and preventing a deflationary spiral.
The Subprime Debacle: Act 2: A post on the foreclosure mess by John Mauldin with large bits via Gonzalo Lira. Controversially, David Kotok appears to have re-purposed the bits by Lira and passed them on to Mauldin.
John Hussman on the Fake Recovery: John Hussman penned a piece suggesting that accounting subterfuge and bailouts are largely responsible for the banks’ stated capital strength. Given this mirage, lending growth will be weak. And because QE will fail, Hussman believes the US economy and US stocks are going to be disappointing in future.
Steve Jobs’ Epic 5-Minute Anti-Google Rant: In Apple’s latest quarterly conference call, Apple CEO Steve Jobs had some very pointed words to say about Google. The Apple – Google dogfight seems to be shifting into high gear.
An Unusual But Interesting Argument Which May Help To Understand Why QE2 Is Now Almost Inevitable: Edward Hugh goes through some logic as to why more quantitative easing is very likely.
Institutional Investors now suing Bank of America for put backs on MBS: A review of why institutional investors and the NY Fed are likely to sue investment banks regarding mortgage-backed securities in the wake of the foreclosure scandal
On The Hypocrisy of Voters: The politics of economics redux: Edward Harrison’s thoughts on how voters’ aligning themselves by party makes them uncritical about government policies when their party is in office.
NY Fed Joins Attorneys General in Pursuing Foreclosure Frauds: Randall Wray points to fraud as the key issue in the housing market. He says ‘control fraud’ is the real story behind the foreclosure crisis.
Chart of the Day: Homes in Australia and Hong Kong overvalued, in Japan and Germany undervalued: The chart of house prices from the economists and comparisons to price to rent show Australia is wildly overvalued, Japan and Germany are undervalued. Of the bubble markets which have burst, only the U.S. is near its long-term neutral valuation. The other’s are still well above.
Bank Holiday is Best Solution for Epidemic of Mortgage Fraud: Randall Wray believes the fraud issue is so endemic to the US mortgage market that a bank holiday is the only way to resolve the problem without more collateral damage
Chris Whalen: US Foreclosure Crisis A ‘Cancer’: Chris Whalen gives powerful testimony as to why foreclosures will keep the US housing market in a state of crisis for some time to come.