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News Links: The debt hangover

  • Free exchange: The hangover | The Economist

    Government borrowing soared everywhere after 2008 as government deficits ballooned. But in America the swelling of the public balance-sheet has mirrored a shrinking of private ones. Every category of private debt-financial, corporate and household-has fallen as a share of GDP since 2008.

  • IMF should stay out of the eurozone crisis – FT.com

    The IMF is right, of course, to conclude that the eurozone crisis is the main risk facing the global economy right now. The world has a strong interest in the resolution of the crisis. But greater IMF involvement in specific EU programmes is not necessary, and quite possibly counterproductive.

  • Con Ed Strong on the Defensive – Barrons.com

    The utility giant just announced its 38th consecutive increase.

  • How Apple is sabotaging an open standard for digital books | ZDNet

    For nearly two years, Apple has wooed digital book publishers and authors with its unconditional support of the open EPUB standard. With last week’s introduction of iBooks 2.0, Apple has deliberately locked out that standard. Here’s why you should care.

  • Apple’s mind-bogglingly greedy and evil license agreement | ZDNet

    Over the years, I have read hundreds of license agreements, looking for little gotchas and clear descriptions of rights. But I have never, ever seen a legal document like the one Apple has attached to its new iBooks Author program.

  • George Soros predicts U.S. riots and insists Euro must be saved or global economy will collapse | Mail Online

    The 81-year-old said he’d rather survive than stay rich as the world faces an ‘evil’ period and Europe fights a ‘descent into chaos and conflict’. He has backed the euro, bought $2billion in European bonds and insisted the economic climate is similar to the 1930s Great Depression.

  • Felix Zulauf Revisits His Predictions, Sees More Trouble Ahead | Enterprising Investor

    Last May, at the 64th CFA Institute Annual Conference in Edinburgh, Scotland, veteran investor Felix Zulauf laid out a number of bearish predictions that have largely proved to be on the money. Now that six months have passed – and with so much happening in the world – we thought it was a good time to review his predictions and get a fresh update on his outlook for the economy and financial markets. Zulauf, who has been investing professionally since 1971, did not disappoint.

  • The Libertarian and the Lobbyists – Simon Johnson – Project Syndicate

    the financial sector lobbied long and hard for deregulation in recent decades, and spent a great deal of time and money persuading politicians that it constituted the safe and modern approach to banking. According to this view, government policies did not fail; on the contrary, they operated exactly as intended – and as bought and paid for. If this view is correct, the kind of policy prescription recommended by Ron Paul is less appealing. Unless you think that a modern financial sector really can operate with absolutely no regulation of any kind (including, presumably, the rules for banks that come with deposit insurance), the real problem is not government officials’ policy preferences, but what financial-sector lobbyists are able to persuade officials to do.

  • EconoMonitor : The Wilder View » Japan’s Lopsided Financial Balances

    The sectoral snapshot of the economic financial balances shows that Japanese policy was indeed a success but also a failure.

  • Spain’s Sectoral Balances

    Except via the possibility of expanding by another private sector led credit expansion which is highly unlikely, the Spanish economy faces the prospects of low output and demand.

  • Greece Lines Up Portugal « naked capitalism

    It is true that 2 months is a very long time in European economics so anything could happen between now and then, but the outcome of Greece, either way, is adding pressure on to the other weak links of Europe, such as Portugal

  • The Fed is Starving Economy of Interest Income – US Business News Blog – CNBC

    Lowering rates in general in the first instance merely shifts interest income from ‘savers’ to borrowers. And with the federal government a net payer of interest to the economy, lowering rates reduces interest income for the economy. There is no question in my mind that the Fed has ample evidence to question their presumption that given today’s institutional structure lowering rates and quantitative easing may have been counter productive and made things worse as per the interest income channels.

  • Kolumne: Wolfgang Münchau – Die Lehre vom Ende der Krise | Premium-Artikel von FTD.de

    Wir erleben an der Börse gerade eine Idiotenrally. Tatsächlich dauert die Schuldenmisere an. Sie ist frühestens vorbei, wenn wir mit der prozyklischen Krisenpolitik aufhören

  • Standard and Poor’s dégrade trois grandes banques françaises – lesoir.be

    L’agence de notation Standard and Poor’s a abaissé d’un cran les notes de trois grands groupes bancaires français (Société Générale, Crédit Agricole, BPCE) et privé de son « triple A » la Caisse des dépôts, bras armé financier de l’État.

About 

Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty years of business experience. He is also a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC, Fox Television and RT Television. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College. Edward also writes a premium financial newsletter. Sign up here for a free trial.

1 Comment

  1. Anonymous says:

    The Economist article is interesting because it shows that politicians have learnt the wring lessons about debt. In the US the reduction in debt was forced because so many households were at that tipping point as the crisis struck so had to de-lever and fast. In the UK the politicians did everything possible to forestall the imminent housing bust. So foreclosures have been lower but as is pointed out the hangover will take decades to clear. It does tie government policy to such an extreme that we will now have years of stagflation as policy not because we have no alternative.