Author

Frances Coppola 35 posts 0 comments

Frances Coppola, a former banker, is a writer, singer and twitterer extraordinaire. Coppola Comment is her main blog, which started out as a place where she could ramble on about anything that interested her. These days the posts on the site are entirely about matters financial and economic. She does not talk about her personal life or beliefs unless they are relevant to a financial or economic matter. Frances is politically non-aligned and economically neutral (She does not regard herself as "belonging" to any particular school of economics). And she does not give investment advice.

Monetary System

Wynne Godley: Interest rates, growth and the primary balance

Frances Coppola Dec 26, 2013

Godley shows that under all scenarios, debt/gdp stabilises at some combination of interest rate, growth rate and primary deficit/surplus - provided there is full employment. So debt/gdp does not "spiral out of control" if government…

Political Economy

The Eurozone, Germany and the ECB’s interest rates

Frances Coppola Dec 20, 2013

Solving Germany's investment problem requires both low interest rates and increased government investment. The ECB is at least attempting to address the first of these. But when is the German government going to accept its responsibility…

Economy

Germany has a capital investment problem

Frances Coppola Dec 14, 2013

An increase in government borrowing to fund medium-term investment is not going to result in out-of-control inflation. But failure of capital investment due to an out-of-control capital account deficit will in the end impoverish Germany.

Economy

Malinvestment and the endogeneity of money

Frances Coppola Dec 2, 2013

So much has been written about the endogeneity of money that I thought it was now widely accepted. But recent exchanges have shown me that people STILL aren't getting it. Most recently, there have been two themes doing the rounds that…

Markets

About that ECB interest rate cut

Frances Coppola Nov 9, 2013

Consumer price inflation in the Eurozone has been below the target of 2% and falling for quite some time. But until now, the ECB has been sitting on its hands. Inflation some distance below target didn't appear to bother it - most likely…

Monetary System

QE is not inflationary, but is it deflationary?

Frances Coppola Nov 8, 2013

I've suggested previously that QE could actually be deflationary. I looked at it from several perspectives - collateral effects, the monetary transmission mechanism, distributive effects, even Peter Stella's "deadwood" inhibiting bank…

Economy

Why the Fed can’t taper

Frances Coppola Oct 31, 2013

It is not US fundamentals, but global fundamentals that will determine the Fed's ability to taper. If the Fed tapers when the global economy is already in the doldrums, as it is at the moment, the recessionary rebound to the US economy…

Economy

A new approach to deposit insurance

Frances Coppola Aug 19, 2013

Recent developments in the Eurozone, specifically Cyprus where the first EU-dictated bail-in of bank depositors took place, brought to light an important issue which had been hiding in the shadows: the flawed nature of current deposit…

Markets

Britain’s illusory housing recovery

Frances Coppola Aug 14, 2013

Osborne's behaviour both angers and frightens me. He is playing brinkmanship with the UK economy to achieve political ends. Nothing he does makes much sense from an economic point of view - which is why the flagship Help to Buy scheme has…

Economy

Bank runs: who’s going to clean up the mess afterwards?

Frances Coppola Aug 1, 2013

By Frances Coppola In my post on the anatomy of a bank run, I suggested that the rule should be "provide central bank liquidity support to everything, taxpayer support to nothing". This is because in a bank run/liquidity crisis, it isn't…