A day ago the japanese stock market dropped by 6%. Last night, our time, it plunged by a further 10%. Today Europe’s markets are droping like stones. London at the time of writing (10 am) has fallen 3% just this morning, Paris 4%, Frankfurt 5%. Unlike the fall out from their reactors which may stay …
In the last two posts I have argued that debt has surpassed the importance of wages in increasing the flow of money and of driving first inflation and then, in the bust, deflation in those things traded and held in debt – such as property. In this post I just want to make a fairly …
The purpose of these two articles is to argue that because of the particular way in which our financial system evolved before the debt collapse and the actions taken thereafter to bail out the banks and protect their debts, we are now seeing both inflation and deflation in different parts of the economic system. I …
Having an ugly sister isn’t great. Having two is awful. Having them both visit at the same time is a disaster. That’s where we are. Inflation and her ugly mirror-twin, deflation, have both arrived. A lot of people argue about whether we will have Inflation, hyperinflation or deflation. In Currency Wars and in Inflation/Deflation, back in …
The Ugly Sisters – Inflation and Deflation. Part 1 Read More »
Watching Europe deal with its debt crisis is like observing a knife catching competition – in slow motion. No matter how long it goes on, no matter how many times the idiot contestants see the outcome demonstrated, they all manage to express surprise or even dawning outrage when another of their digits is neatly sliced …
This morning the rating agency Moody’s cut Greece’s credit rating from Ba1 to B1. That is a big drop. It’s three levels down in a single review. Ba1 is the first level of Non-Investment grade or Speculative bonds. B1 drops Greece into the region marked “Highly Speculative”. Bolivia lives down there. Below is only ‘Extremely …
Greece downgraded again to ‘highly speculative’. Read More »
In an interview with the Telegraph, Mervyn King, the Governor of the Bank of England said, “…the institutions bailed out were those at the heart of the crisis. Hedge funds were allowed to fail, 3,000 of them have gone, but banks weren’t.” Could there be a repeat? “Yes! The problem is still there. The ‘search …
In three weeks time, mass demonstrations are being planned in the UK against public sector cuts. The organisers of the 26th March protests have called themselves the Coalition of Resistance, with the aim of consolidating a variety of unions and groups most at risk. What they are resisting are the cuts and austerity measures which …
Guest Post by Hawkeye – Crime and Collective Punishment Read More »
Bankers really are whiners aren’t they? This morning the FT reports the whinings of Oswald Grübel, CEO of UBS, one of the big, Swiss bail-out banks. Mr Grübel is described as a veteran whiner, sorry banker. And this morning he is whining about over-regulation and not being loved enough. He complains that, “Only behind closed doors …
Regulatory Arbitrage – what bankers don’t have to tell us Read More »
Everybody wants to know what is going to happen in Libya. And worse, for the Libyans, everyone wants to have a hand in deciding what does happen. Saudi is interested because with the drop in oil output and the price heading above $100 a barrel Saudi is feeling the pressure to raise its output to …
