News Links: Greece Will Eventually Leave Euro
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Greece Will Eventually Leave Euro, Rogoff Says – Bloomberg
European leaders’ agreement to expand a bailout fund to stem the region’s debt crisis only buys time as Greece will likely still leave the euro in the next decade, Harvard University economist Kenneth Rogoff said.
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interfluidity » Expectations can be frustrated
I have a Minsky/Mankiw theory of depressions. In this world, a central bank that targets something — NGDP, inflation, whatever — doesn’t regulate behavior via expectations. Instead, the central bank regulates access to credit and wages. When the economy is “overheating”, the central bank raises interest rates to increase debt servicing costs, tightens credit standards to diminish new borrowing, and if absolutely necessary squeezes so hard that a recession reduces spenders’ wages via unemployment. When the economy is below potential, the central bank reduces interest rates and relaxes credit standards, encouraging spenders to borrow and leaving them with higher wages net of interest payments.
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Italian government buys 19 Maserati supercars despite austerity cuts – Telegraph
Italy may be in the midst of a savage austerity drive but that has not stopped defence ministry officials ordering a fleet of armoured Maseratis to ferry themselves around Rome.
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BBC News – Germany finds extra 55bn euros after accounting error
Germany has found itself 55bn euros ($78bn; £48bn) richer after discovering an accounting error at Hypo Real Estate (HRE), the troubled bank it nationalised in 2009.
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BBC News – Occupy Wall Street: Arrests in Nashville and San Diego
Protesters in two US cities have been detained after police moved into their camps during the night.
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Bank of America scaling back debit card fees | Reuters
Bank of America Corp, after receiving heavy public criticism for a planned $5 per-month debit card fee, is likely to give customers more ways to avoid the fee, a person familiar with the bank’s plans said Friday.
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America’s Other 87 Deficits – Stephen S. Roach – Project Syndicate
The United States has a classic multilateral trade imbalance. While it runs a large trade deficit with China, it also runs deficits with 87 other countries. A multilateral deficit cannot be fixed by putting pressure on one of its bilateral components. But try telling that to America’s growing chorus of China bashers.
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Fees Are Biggest Drawback To Banking
Low-income consumers are dropping their bank accounts in droves and bank fees are to blame, a recent study from the Pew Health Group found.
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Goldman sued for $1.07 billion over Timberwolf CDO | Reuters
Goldman Sachs Group Inc (GS.N) has been hit with a new $1.07 billion lawsuit for having allegedly sold risky debt that it expected would tumble in value to an Australian hedge fund, causing that fund to become insolvent.
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BBC News – Italy sells bonds at record high of 6% at auction
Italy’s cost of borrowing has reached a record high, despite the deal reached to contain the eurozone debt crisis.
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Did Oakland Police Intentionally Shoot Marine Vet Scott Olsen In the Head? | ZeroHedge
the Alameda County Sheriff has hosted some of these Swat competitions (Oakland is in Alameda County, California). And the militarization of police forces throughout the United States cannot be taken in a vacuum. The bigger pictures is that the government is using anti-terrorism laws to crush dissent.
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Die wunderbare Welt der Wirtschaft!: Warum beteiligt sich die EZB nicht am Haircut?
Ich finde es aus – auch aus dem Aspekt der Solidarität – ziemlich verblüffend, dass sich der private Sektor beteiligen muss (auch wenn das freiwillig genannt wird), die EU für sich selber aber dankend ablehnt.
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I Wouldn’t Touch Groupon’s Stock At The IPO Price With A 50-Foot Pole
Now, in my experience, when companies decide to transition from hyper-growth-and-losses to sustainable-growth-and-profitability, as Groupon is, the transition can be very rough. Importantly for this exercise, it also can be absolute hell on stock prices. The example that jumps to mind is Amazon.com.
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Obama ‘Bundlers’ Have Ties to Lobbying – NYTimes.com
Despite a pledge not to take money from lobbyists, President Obama has relied on prominent supporters who are active in the lobbying industry to raise millions of dollars for his re-election bid.
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Vancouver Bidding-War House? It’s Being Flipped for 78% (Annualized) Gain
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FT Alphaville » “Something structural has changed in current fundamentals”
ask anyone in the market — specifically the physical market — and they will tell you the market is tight. Not just tight. Really tight. (And most likely that the recent backwardation reflects this tightness.)
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It’s Time for Debt Forgiveness, American-Style | The Nation
Laurie Goodman, a senior managing director and housing-finance expert at Amherst, warns Washington audiences, “There is a cost for doing nothing. You just kick the problem down the road; you don’t solve it. Then home prices deteriorate more and you re-create the death spiral in housing, as lower prices mean more borrowers are underwater.”
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