From the Financial Times: No one can pretend to know whether Spain is illiquid or insolvent without gauging the size of the black hole that is the country’s banking sector. The Spanish government is finally starting to do this: Bankia and other banks are reportedly set to receive a capital injection from Madrid. With the … Read more
Lakshman Achuthan is sticking to his call that the US will enter recession in the second half of 2012. He spoke to CNBC’s Squawk Box crew about it this morning. Take a look. Note: Achuthan is right about the NBER’s definition of recession. It is not back to back quarters of a negative change in … Read more
Later this week, I plan to write a more comprehensive post on the European sovereign debt crisis to incorporate what we have learned since the French and Greek elections. Here’s a short preview of what I will have to say. For me the details and the minutiae can be distracting. When analysing situations like the … Read more
When people look at “fracking”—the production of natural gas through hydraulic fracturing techniques–they see different things. Critics see polluted wells, exploding houses, and earthquakes—an environmental disaster in the making. These anti-frackers have a simple solution: ban it. In contrast, industry supporters see hydraulic fracturing as a safe technology that drillers have been using for decades … Read more
“When the crisis erupted, we realized we had stuck to a fairly basic rule, which was that the bulk of Tier 1 capital had to be in equity. That turned out to be very, very important.” -Jamie Dickson, Superintendent, OSFI (Canada’s bank regulator) Bloomberg Markets has a list of the world’s strongest banks — they … Read more
Nearly one Spaniard in four is unemployed, according to data released on Friday, as the country’s economic and financial predicament prompted a government minister to talk of a “crisis of enormous proportions”.The data from the National Statistics Institute showed 367,000 people lost their jobs in the first three months of the year. At this pace, … Read more
Europe is in recession. Britain’s Office for National Statistics confirmed on Wednesday that in the first quarter of this year Britain’s economy shrank .2 percent, after having contracted .3 percent in the fourth quarter of 2011. (Officially, two quarters of shrinkage make a recession). On Monday Spain officially fell into recession, for the second time … Read more
Sheila Bair, former head of the FDIC is just about the only one in Washington who gets the irony of the continuing foreclosure crisis. A couple of weeks ago she published a tongue-in-cheek call for the Fed to provide a $10 million interest-free loan to every American household:https://www.washingtonpost.com/opinions/fix-income-inequality-with-10-million-loans-for-everyone/2012/04/13/gIQATUQAFT_story.htmlEvery underwater household could pay off the crappy … Read more
Last fall I posted here my Keynote Presentation For the Conference: The Capitalist Mode of Power: Past, Present, Future, York University, Toronto, October 2011. You can view my presentation as well as the Q&A that follows on Youtube here: http://www.youtube.com/watch?v=IZdZmu8mHTw&feature=plcp
Dean Baker, responding to this Wall Street Journal article, sees an opportunity to make us aware on the distributional impacts of monetary choices. Specifically, Baker responds to the claim that inflation erodes earnings: Actually, most wages follow in step with inflation, although some workers do see declines in real wages when inflation rises. People seem … Read more