Monetary System

Another Friday night in America means another bank goes bust. This week, it's two banks: Haven Trust of Georgia nd Sanderson State of Texas. BB&T is stepping in for the deposits at Haven Trust. And Pecos is taking the deposits at…

It's been a month since I updated my list of writedowns and other credit crisis-related news, so I am sure that this list is filled with holes and missing information. Here it goes nonetheless. Below are the writedowns from the previous…

I was chatting with Marshall Auerback about some of my recent posts on Keynesianism and Austrian Economics -- Marshall is a Keynesian -- and he convinced me that my posts were somewhat misleading and that I had only presented half of the…

I am certainly of the view that a considerable worsening of the recession is baked in the cake for 2009. But will fiscal and monetary stimulus prevent worst case scenarios? I certainly hope so, as I have laid out in recent posts. But,…

Recently I wrote a post which claimed that Keynesian stimulus is what we need in the global economy right now. These ideas are considered heresy in Austrian School circles because trying to stimulate the economy out of recession only puts…

Jamie Dimon tells it like it is. When asked by CNBC's Erin Burnett's how business is going, Dimon replied "terrible." Here's how Reuters describes his comments: "November itself has been a terrible trading month ... (and) December so far is…

Caroline Baum had a good column today at Bloomberg in which she suggests central banks consider asset prices in monetary policy going forward. In the piece she quoted William White, a former economist from the Bank for International…

Yves Smith has a good post over at Naked Capitalism that brings attention to the fact that banks are hiding potential losses in Level Three assets. Ultimately, these losses are going to have to be recorded and that means more credit…

First the Fed and now the ECB and Bank of England are talking about some form of quantitative easing! Of course, if they are all going to do it, do we have a dollar crash or is it more of a crisis of confidence in fiat currencies in…

Here's a good little measure to see how far we've fallen: Just more than 1 year ago Royal Bank of Scotland (RBS) paid $100bn for ABN Amro (80% cash). For this amount, RBS could buy: