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Browsing Category
Political Economy
I repeat: The Fed’s Permanent Zero rate policy is toxic
Permanent zero can work over the medium-term but the economy is dependent on employment growth and monetary policy doesn't drive that.
The stark contrast between European economic policy and US economic policy
I was on CNBC yesterday ahead of Ben Bernanke's speech explaining the FOMC's recent decision to add an explicit inflation target to its decision to extend its rate easing/permanent zero policy. My conclusion: the Obama mortgage plan and…
Geithner tells Bloomberg that Obama will give him the sack if Obama is re-elected
I had a bet with a bunch of fellow market watchers back in early 2010 when Geithner was getting it from all sides as to how long he would last. Some people were saying he couldn't make it through the second year. Geithner outlasted…
Why I am not optimistic about Europe
I am not at all optimistic about the euro zone in terms of policy makers fashioning a solution to the problem. The euro leaders have the diagnosis all wrong. They keep harping on government debt and deficits as if that's the problem. And…
First Act of Greek Default Proceedings Drawing to a Close
n the short term, one of the only remaining stumbling block in the form of the ongoing default proceedings in Greece seem to be no match for the ongoing positive animal spirit of the equity market. Only a week ago, we got news that talks in…
A Month In Spain That Didn’t Shake The World
Spain’s economic problems are very grave. The country is facing a decade long depression, and if enough young qualified people leave during this period then the country could enter a negative dynamic from which it will never properly…
Spanish government doubts it can achieve deficit target
I have been saying for a few months now that all of the periphery would miss their targets as depression took hold. Belgian newspaper De Standaard reports that the new Spanish government is fearful. My translation from Dutch below.
The Importance of the Mario Brothers
They are not really brothers, but Mario Draghi and Mario Monti are countrymen and are doing a great deal to respond to the European debt crisis in ways that were unimaginable until very recently.
Münchau: We are fighting the wrong crisis
To me this situation looks pretty hopeless frankly. Policy makers in Europe just don't get it. The best we are going to get is austerity and partial monetisation by the ECB until the union breaks or sovereign debtors default and banks are…