For those who listened to the siren voices telling us that the Euro bail-out worked and the global recovery was underway – think again. One of the reasons I have written much less recently is the feeling of repeating myself. We are in a holding pattern. Waiting for the autumn Spending Review in the UK, […]

It’s been a long day so I’ll keep this short. A few days ago there were breathless reports of how exports from Germany had shot up. Today markets fell world wide, in part, because of news that growth in both the US and China has slowed, probably quite a lot. So where was germany exporting

Part Three What I have argued so far tries to describe how the system was poisoned and why it ‘froze’ as suddenly as it did. What I want to argue now is far more important. I want to show how Securitization and the Shadow Banking System, will, by necessity of their design, always accelerate towards

Risk – the devil inside Whenever someone buys a security they do so because they want the promised return on their money. What they don’t want is the Risk that goes with it. Risk and return are the light and shade of finance. You can’t get one without the other. But the promise that you

At the centre of all debates about the Banking crisis, the shadow Banking system and the bank bail-outs is Debt. For a long time I have been arguing that what this debt is, is in fact a new, bank created, bank issued and ultimately bank debased debt-backed currency. And the collapse in value of this

What are our leaders going to do next about the state of the banks and broader financial system? We have had the US bail-out (TARP) and various stimulus measures. We have had the European Bail-out. Or the announcement of it. It still isn’t quite through all the parliamentary hoops yet. And we have had the

According to an article in the New York Times (Thanks to Lars Eirik for noticing and posting) on the 27th of July, two economists Alan Blinder, a Princeton professor, former Clinton advisor and former board member of the Fed, and Mr Zandl chief economist at Moody’s Analytics claim that with a “complex quantitative model”, they

Did you know that the Hindenburg zeppelin had been rigorously stress tested? And that the design of the Maginot line was almost impregnable? Everything that has ever sunk, exploded, tipped over, burst into flames, fallen down or simply not worked had been stress tested in its day. The problem is that stress tests are rarely

Owe a man ten pounds and he has power over you. Owe him ten thousand pounds and he has a lot of power over you. But owe him ten million or ten billion and YOU have power over HIM. Debt is more fickle and slippery than money or direct wealth but it still has power.

I have written for a while now about how I see a clear division and open opposition hardening between the US and Europe, Washington and Berlin, the FED/IMF and the ECB. Well today we got to see that opposition break out into the open. The FED and the ECB are now on a collision course.