Political Economy

Hank Paulson may have created a monster. He has recently said that he does not want to use the TARP (Troubled Asset Relief Program) to buy dodgy assets as he originally billed the U.S. bailout measure. Instead, he wants to inject cash…

This chart and the commentary both come from FT Alphaville: A look at the Fed's balance sheet currently will tell you it's very much in the business of supporting liquidity/prices in assets other than Treasuries. The graph below is a…

Hank Paulson knows he has two months left until he leaves Washington. Therefore, he must feel he needs to pass out as much free cash to his friends in banking and finance before he leaves town. Or, at least so it seems. The latest story I…

Deregulation and laissez-faire orthodoxy bears much of the blame for the current economic mess we are experiencing. Dean Baker notes with chagrin that Barack Obama, who will take office as U.S. President shortly, has put some of the…

Jon Danielsson has a very thorough piece up on the VoxEU site which details the catastrophic collapse of Iceland and its banking system. This is a cautionary tale on two fronts. First, Iceland was a small country with a very large…

The stars are aligned for the big three automakers because everyone is coming out in their favor. First, we heard that they were meeting with congressional leaders on Capitol Hill. Then, we heard that Rahm Emanuel, a house democrat and…

The United States Government's bailout of the financial sector is approaching breathtaking proportions. There are so many pronouncements and announcements of this monetary stimulus and that loan of this preferred equity stake and that…

For those of you concerned about the Fed's risky behavior, its ballooning balance sheet, and its acceptance of dodgy collateral, well you may be about to see whether the American democracy can allow this unchecked power to continue without…

Barack Obama promises to make some dramatic changes in U.S. foreign policy after eight years of a neo-conservative agenda. The question really is what would those changes be. Below, David Ignatius outlines a reasonable argument that Obama…

Barack Obama has won the U.S. presidential election in convincing fashion. While I am clearly not a liberal nor a Democrat, I am pleased with the election's outcome. It signals a new beginning - a new era in American politics and in…