Monetary System

As you know from reading my blog, I am expecting a lot of writedowns from regional banks as real estate loans sour. In fact, I expect a number of bankruptcies because of defaults in commercial real estate where much exposure is hidden.…

It's a done deal. The Citigroup - Morgan Stanley dance is now over. The price for a 51% stake Smith Barney was $2.7 Billion. The seems like a very low valuation here but I haven't looked through the terms of the deal in depth. This is…

Vikram Pandit understands the seriousness of the challenge ahead, if Citi wants to remain a going concern. He must break the firm up and end Citi's disastrous experiment with becoming a financial supermarket.

Today, the Seattle Federal Home Loan Bank (FHLB) has admitted that it is on the verge of collapse and may need to avail itself of conservatorship, much as Fannie Mae and Freddie Mac did previously. One should see this announcement as a…

Federal Reserve Chairman Ben Bernanke gave a speech at the London School of Economics today in which he outlined the measures the Federal Reserve was prepared to take in order to deal with the financial crisis. Of particular note, Bernanke…

We are in a secular bear market. What this means for many pensioners or for many about to become pensioners is great uncertainty about the quality of their retirement. I expect this uncertainty to translate into anger regarding the move…

This just hit the wires. Apparently, Bob Rubin has tendered his resignation at Citigroup. Here is he story from the Wall Street Journal:

It looks like John Kenneth Galbraith is back in style after years of the laissez-faire crowd holding court. The Economist chronicles the revived interest in his works according to book sales at Amazon. He is definitely on my reading list.

UPDATE: 25 Mar 2009: In anticipation of the upcoming G-20 meeting and on the heels of some provocative comments made by Chinese officials regarding the US dollar, I would like to re-post this article from January. Paul Davidson has a very…

This comes from Chapter VIII of Galbraith's classic volume, "The Great Crash 1929." Given the recent announcement of fraud at Satyam in India and the monstrous Madoff scandal, it is a quote and concept to remember.