Post Tagged with: "credit crisis"
Spain’s bank nationalisation and the euro zone crisis
On Monday I first learned that Spain was to partially nationalise its banking system via the Financial Times Deutschland. The title of this article is the most appropriate I have seen discussing the issue, "Madrid riskiert für Cajas seine Staatsfinanzen", which means "Madrid risks state finances for savings banks". Appropriately, the article began with a
The real cost of Chinese NPLs
by Michael Pettis Once again I am starting to hear investors tell me that they have been advised by bank analysts not to worry too much about the impact of a banking crisis in China. According to this argument, China has developed a very efficient and low-cost way to address banking crises, and the proof
The Fall of the New Monetary Consensus
By L. Randall Wray The following is a paper given at the ASSA conference in Denver this past week for a panel organized by James Galbraith, titled Pressures on the Paradigm, sponsored by Economists for Peace & Security. The Queen famously asked her economists why none had seen the global crisis coming. Obviously the answer
Markets Vanish – In a Flash
Frederick J. Sheehan is the author of Panderer to Power: The Untold Story of How Alan Greenspan Enriched Wall Street and Left a Legacy of Recession (McGraw-Hill, 2009) and "The Coming Collapse of the Municipal Bond Market"(Aucontrarian.com, 2009) The following is a short excerpt from "War of the Nerds," which I wrote for the December,
How the US Congress is Sowing the Seeds of the Next Crisis
I wrote recently about the Bank of England sowing the seeds of their next banking crisis by deciding to reduce bank examinations. Spencer Bachus (R. Ala.), the incoming Chair of the House Financial Services Committee, told the Birmingham News: "In Washington, the view is that the banks are to be regulated, and my view is
Mervyn King: “Systemic Insolvency Is Now The Problem”
I want to take you through how we got from the financial system’s "systemic insolvency" to bailouts to record profits and bonuses again in the span of two years. From the WikiLeaks cables as published in the Guardian today regarding a meeting with the US Ambassador to the United Kingdom and the Bank of England
Wait for the next crisis for reform of the monetary system
There has been a lot of chatter of late about countries ditching the US dollar as the primary reserve currency and moving on to something else. Robert Zoellick mentioned gold as the alternative. Nicolas Sarkozy has been talking up special drawing rights and the Russians and the Chinese recently decided to open an exchange to
Quick Thoughts on the Irish Bailout
I am still in catch-up mode this morning but I wanted to highlight a few points on the Irish bailout. The first has to do with the European stress tests. If you recall, the two Irish banks tested were Bank of Ireland and Allied Irish Bank. Both passed the tests. These paragraphs from the BBC
How the Fed and the Treasury Stonewalled Mark Pittman to His Dying Breath
Originally published at www.CounterPunch.org. by Pam Martens On the President’s first day in office on January 21, 2009, he issued an Open Government memo promising the American people a new era of transparency. On March 19, 2009, under the President’s orders, the Attorney General’s office issued detailed guidelines on how Federal agencies were to respond
All Eyes on Europe (or was that Seoul?)
by Claus Vistesen Life can be incredibly cruel sometimes. Only a week after Bernanke gave markets an early Christmas present with another helicopter drop, the S&P500 is stuttering and it seems, much as many astute observers have argued, that the real effect from QE lies in the announcement itself. Further, and to add insult to
A Minskian View of the Causes of the Current Crisis
by L. Randall Wray In recent weeks, the explanation for the financial and economic crisis that has gripped the world economy has shifted sharply from deregulation and lack of governmental oversight of financial institutions to fraud and criminal activity. In truth, the US Federal Bureau of Investigation began to warn of an “epidemic” of mortgage
Greek Woes
Sunday Greek deputy Prime Minister Pangalos told a local paper that in theory debt restructuring should not be completely ruled out, though the deficit would need to be dealt with first. He argued against "demonizing" debt restructuring. This obviously has antagonized investors. The Greek 10-year yield rose 18 bp today after rising 120 bp last