I loved the irony in the following headline from the NYTimes:Scandal Poses a Riddle: Will This Nation Ever Be Able to Tackle Corruption? A brazen brand of crony capitalism has created huge fortunes for a few, at the expense of the nation as a whole… (link: http://www.nytimes.com/2012/09/16/world/asia/scandal-bares-corruption-hampering-indias-growth.html?nl=todaysheadlines&emc=tha22_20120916) The kicker was that they were referring to … Read more
Diaz-Bonilla, in his recent EconoMonitor post, reminds us that “policy intervention must point directly to the problem, because the further away and more indirect the policy intervention, the more likely that other distortions and unwanted effects will occur”, something that he calls the Bhagwati Rule. He then builds on it and suggests the Fed to … Read more
In the aftermath of the global financial crisis, optimists hoped that the BRIC (Brazil Russia India China) would drive the global economic engine. But China’s economic growth has slowed to its lowest rate in three years. Brazil’s economic growth has fallen from around 7.5% to under 3%. Russia’s economy is heavily dependent on oil and energy … Read more
Sorry for the relative silence here at GLF–I’ve been traveling. This past Tuesday I gave a presentation at Columbia University, which is running a great series of talks, many of them presenting the Modern Money approach. These talks are streamed and eventually videos of the talks will be posted. You can sign-up for free! (Sorry … Read more
From Stephen Harper to Ben Bernanke I took a fascinating graduate course at The Maxwell School of Syracuse University from Dr. Margaret “Peg” Hermann, a leading political psychologist. She taught us the theory and methodology of psychologically profiling political leaders, and over the course of the semester we each completed a profile of a leader … Read more
Some people observed 9/11 by lighting candles, others by killing more Americans. Yesterday a mob stormed the U.S. Consulate in Benghazi, Libya, killing the U.S. ambassador to Libya and three other Americans. Among other implications, this raises the possibility that the stability that seemed to have returned to that country may be short-lived. As of May, … Read more
So, the latest FOMC policy announcement is here. A new mortgage-backed securities buying spree of $40B per month — but it seems to be open ended, so before you do the math, its either $480 billion over the next 12 months, or its appreciably higher. Get some refi papers and take advantage of our new low low … Read more
On September 13, 2012, the Fed announced a further program of quantitative easing, or QE. The program, which we will all call by its unofficial name, QE3, will consist of purchases of some $40 billion in mortgage-backed securities each month plus continuation of some existing asset purchase programs. We are told that QE is the … Read more
There has been a steady drumbeat from the Treasury Department as to what “successful investments” the bailouts of Wall Street have been. This morning I’d like to broadly consider that by discussing a few key points that I have yet to see addressed. Namely, that these were not investments, but rather they were systemic rescues. If you … Read more
Nouriel speaks on Bloomberg about Mario Draghi’s bond-buying plan, the future of the euro and the Fed’s plans this week and ahead of the election. Roubini: Here’s My Blueprint for the Future