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Michael Lewis is out with a new book “The Big Short: Inside the Doomsday Machine” which discusses how the big hitters on Wall Street destroyed $1.75 trillion of capital. His phrase ‘Doomsday Machine’ is reminiscent of former IMF chief economist Simon Johnson’s ‘Doom Loop’ phraseology which I reviewed two weeks ago.
Below, Lewis discusses his take [...]

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Bundesbank President Weber has been the most candid to date about what the ECB could do in case Greece is downgraded again, especially by Moody’s.  Recall the problem:  Prior to the crisis, the ECB would take as collateral only paper rated A- or better.  During the crisis they have extended it to BBB-.  It is [...]

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We have a bit of a divide developing between the EU and the U.S. on banking and bank reform. The most significant move in this tiff has come in retaliation for Wall Street’s role in helping countries like Greece hide their debt burdens. According to the Guardian newspaper, all American banks have been shut out [...]

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I have taken a less optimistic view of the credit crisis’ workout phase as evidenced by recent posts like Wood: “The endgame will be a systemic government debt crisis in the western world” and The mindset will not change; a depressionary relapse may be coming. So I want to give you a bit more colour [...]

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One of the more surprising announcements of support for a bailout of Greece comes from none other than Theodor Waigel, the former German Finance Minister who invented the Stability and Growth Pact. While Greece was able to successfully roll over debt today, there still will come a time when they may need financial support. This [...]

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Detroit homes sell for $1 amid mortgage and car industry crisis | Business | The Guardian
Aides say Coakley will seek reelection as attorney general – The Boston Globe
Depression’s Upside – NYTimes.com
Bankruptcy looms, Greek PM warns – The Globe and Mail
400,000 Will Lose Jobless Benefits Next Week – Economix Blog – NYTimes.com
Scientists Discover Booze That Won’t [...]

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The following is a Wall Street Journal video on the sovereign debt crisis in Greece.

Also see the associated article in the Wall Street Journal: Greece Set to Outline New Austerity Measures Wednesday.

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The Wall Street Journal is reporting that a plan to bail out Greece to the tune of $41 billion is now being formulated by Germany and France. It might seem as if a bailout is inevitable and that the terms of such a bailout are the only things now being negotiated between EU members. However, [...]

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A parable about how one nation came to financial ruin. – By Charles Munger – Slate Magazine
New York State of Disrepair – WSJ.com
Liz Pulliam Weston: Broke? Calculate your debt ratios – MSN Money
Federal Reserve talk belies likely action on money supply – Bill Fleckenstein
Why the IMF should deal with Greece – [...]

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Things are getting heated in the Greek sovereign debt crisis – with the main battle lines being drawn between Greece and Germany. There are a lot of stories in the German press about Greek profligacy and cheating (see German-language links below video). Then there are the stories about Greek boycotts of German products and the [...]