Roubini Topic Archive: Macroeconomy
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MORE QE, LIBOR, BOND VIGILANTES , SOVEREIGN GOVERNMENTS, AND INTEREST RATE DETERMINATION
The Fed’s meeting again, and many expect another round of Quantitative Easing. People talk about a Big Bazooka, but the Fed keeps shooting blanks. No matter what it does, it won’t matter much. There’s so much confusion about interest rate determination and effects of rates on the economy. Let me quickly discuss several seemingly unrelated [...]
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ON THE SUPPOSED WEAKNESSES OF MMT: RESPONSE TO PALLEY
It really rankles critics that MMTers claim they predicted the Euro disaster before anyone else saw it coming. The only problem with that is that we never said such a thing. All we’ve said is that we got it right. If others also got it right, that is great. If they said it first, even [...]
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WHO FIRST WARNED ABOUT THE EURO? THE WSJ WEIGHS-IN
Nice piece by Martin Essex at the WSJ today, “fingering” those who got it right about the Euro. He says: As the world’s financial markets begin to price in a total collapse of the euro project, there’s no shortage of economists and other experts saying they always knew it was doomed to failure. So who [...]
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WHY WE’RE SCREWED
As the Global Financial Crisis rumbles along in its fifth year, we read the latest revelations of bankster fraud, the LIBOR scandal. This follows the muni bond fixing scam detailed a couple of weeks ago, as well as the J.P. Morgan trading fiasco and the Corzine-MF Global collapse and any number of other scandals in [...]
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MMT AND THE EURO: Current Account Imbalances and the Euro Crisis Part 2
Last week we looked at the claim that MMT has ignored current account imbalances among EMU members. That turned out to be fallacious. We went on to examine the claim that the Euro crisis is a simple balance of payments problem. That, too, is fallacious. If the EMU had been designed properly, it would not [...]
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MMT AND THE EURO: Are Current Account Imbalances to Blame for the Euro Disaster? Part 1
Two weeks ago I cited Paul McCulley’s claim that MMT got it right. I followed that up last week with Brad DeLong’s claim that we’re all Minskians now. Well, most of us, anyway. Is MMT on a roll? Well, maybe not, if you listen to the critics. In particular, an Italian economist, Sergio Cesaratto called [...]
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Paul McCulley – MMT Won: Declare Victory But Be Magnanimous About It
We’ve just finished up a ten day seminar at the Levy Economics Institute on the work of Hyman Minsky (see here http://www.levyinstitute.org/news/?event=39). There were a number of great presentations, including lectures by two financial experts who I consider to be among the best speakers today, Frank Veneroso (of Veneroso Associates) and Paul McCulley (the recently [...]
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Martin Wolf’s Liquidity Traps and Free Lunches Through Fiscal Expansion
A couple of weeks ago I wrote a critique of Chairman Bernanke’s understanding of money (here: http://www.economonitor.com/lrwray/2012/04/19/does-chairman-bernanke-know-squat-about-money/). At the end of my blog, I summarized a good column written by Martin Wolf that did get money (mostly) right: http://blogs.ft.com/martin-wolf-exchange/2012/04/17/fiscal-and-monetary-policy-in-a-liquidity-trap/#ixzz1sRMJH300. Wolf promised a Part II on the topic of appropriate monetary and fiscal policy in a [...]
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DOES CHAIRMAN BERNANKE KNOW SQUAT ABOUT MONEY?
I think the biggest policy failures in Washington over the past three or four decades are caused by confusion over the nature of money, and more specifically, the nature of a sovereign currency. So many of our policy makers simply do not understand that a sovereign issuer of the currency is not like a household [...]
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Developing the ‘Financial Instability Hypothesis’: More on Hyman Minsky’s Approach
Since Paul Krugman kicked-off a heated discussion about Minsky’s views on banks, and because the annual “Minsky Conference” co-sponsored by the Ford Foundation and the Levy Economics Institute starts this morning, I thought it would be useful to run a couple of posts laying-out what Minsky was all about. This first piece will detail his [...]
