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Browsing Category
Political Economy
ECB ends Greek collateral waiver, ELA still available, Greek options limited
Last night the European Central Bank announced that it would no longer accept Greek government or Greek government-guaranteed collateral for loans. This step had been telegraphed for a month but the timing demonstrates how political an…
Syriza and the French indemnity of 1871-73
The euro crisis is a crisis of Europe, not of European countries. It is not a conflict between Germany and Spain (and I use these two countries to represent every European country on one side or the other of the boom) about who should be…
Revisiting Greek negotiating positions and more comments on capex and interest rates
This post will be a brief revisiting of three recent topics - Greece, oil capex, and Anglo-Saxon bond yields - due to recent news. The recent news reinforces my position regarding the potential for a deal in Greece. On capex reduction, the…
Negotiating strategies and political constraints regarding Greece
I am going to leave my market-based analysis and enter the murky waters of the political economy. I don’t like the uncertainty of the political economy, given how it is based on the quixotic and unpredictable actions of individuals. But the…
Yanis Varoufakis on fiscal waterboarding and Ponzi austerity
Yanis Varoufakis had a long interview on RT’s Boom Bust yesterday going into detail behind his political candidacy and what he expects SYRIZA to do regarding the unsustainable debt burden that the Greek government now has. Overall, despite…
The Grexit talk should be frightening
About four weeks ago, I wrote a post on Greek eurozone exit scenarios. While I believe that Greece will eventually exit the euro zone, I think it is premature to expect this to occur now as there are many avenues for compromise. The…
Cognitive bias when thinking about the Ruble crisis
I have been appalled at the cognitive bias that masquerades as analysis when discussing the recent collapse of the Russian Ruble. The purpose of analysis is to better understand what the real constraints in a given situation are and to…
My reading of the FT on China’s “turning away from the dollar”
By Michael Pettis
The Financial Times ran a very interesting article last week called “China: Turning away from the dollar”. It got a lot of attention, at least among China analysts, and I was asked several times by friends and clients…
Running through Greek eurozone exit scenarios again
Crisis has returned to the eurozone with talk about a Greek sovereign debt restructuring rife. There is even talk of Greece being forced out the eurozone. With Greek stocks plummeting and sovereign yields rising, we should take this talk…
Policy options in Europe look frightfully limited
Despite, the high cost of gasoline/petrol in Europe due to tax, the fact that Europe is a large net importer of oil means the decline in oil price will be more of a boost for that continent than it is to North America where concerns about…