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Over the weekend the Danish Central Bank took over bankrupt Roskilde Bank, wiping out shareholders. Tiny Denmark has had a bankruptcy on its hands that is following the script of Northern Rock in the UK to a tee:

After lending too much money to the wrong people, the government is forced to step in as no [...]

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Not if you believe the figures from a University of Calgary – C.D. Howe Institute study comparing tax rates in 80 countries – remember, they’re Canadians (hat tip Stephen Gordon). In this list, which includes all the major economies, the U.S. ranks in 3rd place for the highest corporate tax rate for advanced economies [...]

Last week, I showed two charts on returns on the Dow Jones Industrial Average that had two seemingly contradictory messages. In the first chart measuring 10-year returns, one could clearly see that long-term returns have been declining since 1998, signaling that we are in the midst of a secular bear market. And, from the looks of the chart, those declines in returns are far from over. The chart would have looked much the same had I used 15-year or 20-year returns. This is bearish for equities.

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The global economy is in the relatively unique but unenviable position of being bullied by both recession and inflation at the same time. This leaves central banks in a bit of bind. The Federal Reserve has thrown all caution to the wind and cut rates in a reflationary ploy rivaling its actions during [...]

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I can certainly be a bit glum about the decline of America. This financial crisis is the metaphor for the decline of America. Yet, as we get ready for yet another media blitz — the Democratic convention for Barack Obama and his newly anointed running mate Joe Biden — a story in today’s Economist [...]

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The last place in the world you wold expect to hear support of Ben Bernanke is hear. The Bernanke Fed has been as reckless in its attempts to reflate the economy as the Greenspan Fed – probably more so. Nevertheless, when Willem Buiter, a former member of the BoE ’s Monetary Policy Committee [...]

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The bankrupt Danish Bank Roskilde received no bidders as the Central Bank of Denmark looked to unload the bank as quickly as possible. Roskilde got into trouble after the Danish economy turned own and loans it had made to home builders went sour. Eventually, Roskilde became the third large European institution to fail [...]

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Just hours after Barack Obama picked Joe Biden for his running in the U.S. presidential elections (more on that soon), I got a hilarious spam e-mail with a subject line that really tempted me to open it:
McCain picks Paris Hilton as running mate
Spammer ingenuity.

At first glance, a flair-up in the Caucasus region seems to have little meaning for Americans. But just as the collapse of the subprime mortgage market ultimately came to symbolize the beginning of the end of an American credit system run amok, so too does the Russo-Georgian conflict illustrate the limits of American military power and its capacity to exert itself anywhere in the world unilaterally. Neither economic, nor military “unipolarity” seems to work any longer. We have, in the words of Boston University professor Andrew J. Bacevich, a “crisis of profligacy”, in which US foreign policy parallels its domestic dysfunction, because of the refusal of Americans to recognize that they have to pay a significant price for economic abundance at home and geopolitical dominance abroad. In this world the Bush administration unveiled “a breathtakingly ambitious project of near global domination,” writes Bacevich. Preserving American abundance was the watchword, “yet that way of life, based for at least two generations on an ethic of self-gratification and excess, drastically reduced the resources available for such an all-encompassing imperial enterprise,” he writes. No wonder things have not gone well.

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I am happy to announce that I am going to feature a guest blogger every week at the weekend. My guest host will be none other than Marshall Auerback of Prudent Bear fame.
Many of you may recall, Marshall wrote the international column at the Prudent Bear for a considerable time, giving his insight on [...]