May 2011

Banks are never constrained by reserves or reserve ratios. Banks are capital constrained. In our fiat money system, the central bank uses reserves in the system to help the Federal hit a target interest rate. So, the central bank provides…

You have strong growth in emerging markets offset by weaker growth in the developed economies. Who wins this battle? For now, EM is winning and that is bullish for commodities over the near-term.

Dollar stronger on the day for the fourth day in a row. Stories are flying about a possible new Greek aid package, causing choppy currency markets. Swiss CPI well below expectations; Norway CPI above expectations

One of the key premises underpinning the establishment of the Euro as a common currency to be shared by a number of individual national states rather than one single nation was the central idea that the several economies of the…

Once politicians set policy and commit to it by signing it into existence, they would rather risk losing office than change course.

Almost a week before S&P’s move, Fitch cut the outlook for China’s yuan debt to negative from stable. Media coverage was almost non-existent and there has hardly been any commentary. Frankly, most observers don’t even seem to know it…

Dollar selling resumes as equities and commodities recover after US employment report Euro moves back near $1.44 after EU officials discussed further aid to Greece Dollar likely to remain on back foot this week; Growth currencies likely…

The unscheduled meeting between several euro zone finance ministers, Eurogroup head Juncker, EU Monetary Affairs Commissioner Rehn, ECB President Trichet and a few other senior officials was important. It marks the official recognition that…

On Friday I spoke to RT America about the mockery of a sham that is US public discourse on the debt ceiling issue. First of all, the US government creates dollars. They can always manufacture more if they so choose. It's a rubbish argument…

Unemployment insurance for 21st century in the form of a jobs program could end the malinvestment and predations of politicians and foster a strong economy. We need jobs but we must be mindful of predator state capitalism. My proposal below…