Yesterday the leaders of Germany, France, and Italy came together, offering a commitment to work toward new fiscal rules in Europe while keeping a leash on the European Central Bank. From the Wall Street Journal: The leaders of the euro zone’s three largest economies pledged Thursday to propose modifications to European Union treaties to further … Read more
Nowadays the energy picture is confusing at best as the more information we are shown the more blurred our vision seems to become. Mixed messages, poor reporting and a media hungry to sensationalize anything it thinks can grab a headline have led to many wondering what the true energy situation is. We hear numerous reports on … Read more
Yves here. Readers are likely to assume that the “broken market” of the headline is US housing related, say the private mortgage securitization market, but the subject is what once was the gold standard of trading markets, equities. Index Universe has cited a study by the Tabb Group that finds that investor confidence in stock markets is even … Read more
Nouriel Roubini’s 2008 advisory, ‘The Rising Risk of a Systemic Financial Meltdown: Twelve Steps to Financial Disaster,’ reads as quite prescient, looking to the season of fraught policy meetings for central banks and governments that lies ahead. In fact, Nouriel’s outline of a slow collapse at a time when people were hoping for a quick … Read more
They Have it Wrong The debate over how to save the euro and the economy of its union has taken shape around economic prescriptions. On the surface this makes sense; after all, the euro is the currency for seventeen national economies. But whether the debate’s outcome is austerity and budget controls, “pro-growth” policies, or some … Read more
Here is a very nice summary of the approach to crises taken by Hyman Minsky (disclosure: it quotes yours truly): http://money.usnews.com/money/personal-finance/mutual-funds/articles/2012/08/27/that-rumbling-in-your-portfolio-its-real I am providing the link because this is a good antidote to the usual “Minsky moment” or euphoric bubble approach to Minsky usually taken. That is more Kindleberger than Minsky. Kindleberger was a great … Read more
While our prolonged economic downturn is concentrating power and wealth in fewer and fewer hands, it is also stimulating efforts to create more democratic business models. Today’s Financial Times highlights an increased interest in worker cooperatives, with the Basque’s Mondragon as the model. From a June article in the Guardian: MC [Mondragon Corporatio] is composed of many co-operative … Read more
In the last issue of my newsletter much of the first half was dedicated to a discussion of recent events in Spain and Italy and why they reinforce the argument that several countries will be forced to leave the euro and restructure their debt. The most worrying, but expected, fact was the amount of capital … Read more
The price of Brent Crude, the benchmark based on North Sea oil, fell $ 35 between April and June, but increases since then have taken about $ 25 of that back. According to many, reports that Israel will bomb Iran’s nuclear facilities are behind this surge. But do markets believe that this event is now … Read more
Last week, the United States Court of Appeals for the District of Columbia rejected an EPA rule known as the Cross-State Air Pollution Rule (CSAPR). The rule was supposed to have gone into effect at the beginning of 2012, but the same court had previously stayed its implementation on procedural grounds. Last week’s ruling is … Read more