A selection of recent articles, comments, books, news or upcoming events on capitalism, economics and economies, society and sociology, politics, trends, crises... on www.mikeconomics.net.
To give a broader and independent perspective -of the same mind, a different mind or of two minds-, spark discussions, spot some trends, and carry on the debate launched in many places,
including Mike Guillaume’s book “The Seven Deadly Sins of Capitalism” (2nd edition 2013).
Although many articles and comments are picked because of their connection with the book, Mike does not necessarily endorse all the ones published, but found them worthy of attention.
The debate goes on!
Headlines appear in their original wording. Some words or figures may be highlighted or underlined.
The related sin (capital or venial) as addressed in Mike’s book (1st and 2nd expanded edition) is referred to below each piece (in orange fonts).
Capitalism and Inequality –What the Right and the Left Get Wrong
Inequality is indeed increasing almost everywhere in the postindustrial capitalist world. But despite what many on the left think, this is not the result of politics, nor is politics likely to reverse it, for the problem is more deeply rooted and intractable than generally recognized. Inequality is an inevitable product of capitalist activity, and expanding equality of opportunity only increases it -- because some individuals and communities are simply better able than others to exploit the opportunities for development and advancement that capitalism affords. Despite what many on the right think, however, this is a problem for everybody, not just those who are doing poorly or those who are ideologically committed to egalitarianism -- because if left unaddressed, rising inequality and economic insecurity can erode social order and generate a populist backlash against the capitalist system at large. By Jerry Z. Muller in Foreign Affairs: http://www.foreignaffairs.com/articles/138844/jerry-z-muller/capitalism-and-inequality.
The revolution is already happening
Capitalism is at the crossroads. Since the onset of the worst financial crisis in living memory, capitalism is suffering a crisis of liquidity, reliability, and confidence. It is facing accusations of failing to create shared wealth, of neglecting the planet, of generating an ever-widening gap in our societies, and even in failing its primary allies - the shareholders. We do not have to be constrained by our current dysfunctional system of capitalism, argues Michael Townsend on Ecologist (November 28, 2013). People are already finding and implementing more attractive alternatives. A quiet revolution is under way. http://www.theecologist.org/blogs_and_comments/commentators/2177708/the_revolution_is_already_happening.html!
Economists overvalue stock markets
The latest Nobel prize rewarded researchers who have pondered whether investors can outperform the market. The game may be fun, but too much attention has been paid to the economically pointless effort to gain an elusive and basically unethical edge. By Edward Hadas on Reuters (October 31, 2013).http://blogs.reuters.com/edward-hadas/2013/10/31/economists-overvalue-stock-markets/.
Revealed –the capitalist network that runs the world
An analysis of the relationships between 43,000 transnational corporations has identified a relatively small group of companies, mainly banks, with disproportionate power over the global economy. The study's assumptions have attracted some criticism, but complex systems analysts contacted by New Scientist say it is a unique effort to untangle control in the global economy. Pushing the analysis further, they say, could help to identify ways of making global capitalism more stable. New Scientist (October 24, 2011): http://www.newscientist.com/article/mg21228354.500-revealed--the-capitalist-network-that-runs-the-world.html
The sharing economy spooking big business
A plethora of businesses are buying into the collaborative consumption model. It’s an economic model based on access rather than ownership. http://theconversation.com/the-sharing-economy-spooking-big-business-19541!
Youth unemployment in the global context
This report by The Work Foundation (Lancaster University) looks at youth unemployment internationally, placing a spotlight on Germany, Denmark, the Netherlands and Australia, all of which have maintained consistently low levels of youth unemployment despite the economic downturn. The full report (published in January 2013) can be downloaded at http://www.theworkfoundation.com/Reports/329/International-Lessons-youth-unemployment-in-the-global-context.
Europe: A crisis of the centre
Unemployment, austerity, depressed communities and the failing narrative of the liberal centre in European politics is not some endless stasis to which the continent is condemned. It is producing political instability. An interesting perspective by Paul Mason, Economics editor on BBC News. Read on http://www.bbc.co.uk/news/business-17828278.
Why Europe is floundering
The greatest danger facing Europe today is the inflexible determination of European elites to save the euro. While it is still possible that Greece will exit with unpredictable consequences, fears that the currency could collapse have retreated since the head of the European Central Bank, Mario Draghi, committed himself in July to doing “whatever it takes” to shore up the rickety structure. Writes John Gray in The Guardian (October 17, 2012). http://www.guardian.co.uk/commentisfree/2012/oct/17/europe-sinister-currency-elites-eurozone?
'België is mislukt, dus Europa zal niet slagen'
Cultuurhistoricus Thomas von der Dunk ziet met lede ogen aan hoe de hoge heren in Brussel de realiteit uit het oog verliezen. 'Waarop baseren de heren het waandenkbeeld dat wat in twee eeuwen niet is gelukt in België, met twee volken die behalve de moedertaal vrijwel alles met elkaar gemeen hebben, wel in pakweg twee jaar zou kunnen met dertig volkeren die heel wat meer van elkaar verschillen?' http://www.volkskrant.nl/vk/nl/6178/Thomas-von-der-Dunk/article/detail/3334874/2012/10/20/Belgie-is-mislukt-dus-Europa-zal-niet-slagen.dhtml
«La première tentative raisonnée de ce que l’on appelle la « gauche de la gauche » de s’attaquer au mythe européen ». C'est ainsi que l'économiste Jacques Sapir qualifie l'ouvrage collectif par Cédric Durand, En finir avec l'Europe (La Fabrique, mai 2013). On est moins prompt, à la « gauche de la gauche », à critiquer l'idée européenne. La tradition internationaliste rend la chose difficile. La contestation, qui se révèle souvent vague et générale, se focalise sur le caractère « néolibéral »de l’Union européenne, et demeure en retrait quant aux les ruptures préconisées. Sur « L’arène nue », blog de Coralie Delaume sur http://www.marianne.net/l-arene-nue/Faut-il-En-finir-avec-l-Europe_a117.html.
Krugman’s ideas to escape the financial crisis
The American economist has a plan to escape the financial crisis, and it doesn't involve austerity measures or deregulating the banks. But will policy-makers, including our coalition government, heed his advice? A very good article by Decca Aitkenhead in The Guardian (June 3, 2012): http://www.guardian.co.uk/business/2012/jun/03/paul-krugman-cassandra-economist-crisis
How Keynes would solve the eurozone crisis
As opposed to the German (bank)'s view, "Keynes held that both creditors and debtors should share the task of getting economies out of holes they had jointly dug."
By Marcus Miller and Robert Skidelsky. On http://www.ft.com (May 15, 2012).
The overstated inflation danger
By Martin Wolf, in the Financial Times (July 11, 2013).
The ultimate Davos debate: Marx takes on Keynes, Friedman and Schumacher
If you could construct the best panel at a World Economic Forum debate, this would be it. But what would they say about present problems? Read on in The Guardian Economics Blog by Larry Elliott. http://www.guardian.co.uk/business/economics-blog/2013/jan/27/ultimate-davos-debate-marx-keynes
Come Home, America
Realists contend that if we quit defending access to the world’s natural resources — read, oil — nobody else would. Really?... But America was prosperous long before it was a superpower; by 1890, decades before the two world wars, it was already the world’s largest and richest economy. We do not need a large military to be rich. Quite the opposite: it drains our resources. Op-Ed by Elizabeth Cobbs Hoffman, a professor of American foreign relations at San Diego State University and author of “American Umpire”. In the New York Times (March 5, 2013).
The Courageous State: Rethinking Economics, Society and the Role of Government
In The Courageous State, Richard Murphy argues that neoliberalism has bred weak governments led by weak politicians who believe implicitly in the supremacy of the market. It has created a cowardly state: a state that sees responsibility and then runs away from it. Worse, the weak politicians who run our cowardly state want power solely to ensure that as much tax revenue as possible is used to benefit the private sector that they idolise. The Courageous State argues powerfully for a new economic model. That model is based on a very different idea of what the role of the state is. More at: http://www.searchingfinance.com/products/soon-to-be-published/the-courageous-state-rethinking-economics-society-and-the-role-of-government.html
Forget Europe – the markets hold the real unaccountable power
An unholy matrimony between finance and politics has undermined democracy, writes Mark Serwotka in The Guardian (‘January 24, 2013). http://www.guardian.co.uk/commentisfree/2013/jan/24/forget-europe-markets-power-finance-democracy
What we fail to teach our kids about money
By Andy Golding, with special contributions from Dr.Trevor Lee, @CoffeeCurls and Paul LucraftAndy
Golding can't make you a millionaire, but this is what he can do:
- To get you thinking about money, your choices and options.
- To help you develop an early warning system for your financial problems.
- To get past some of the myths about money and to give an insight into the thinking at your bank.
The callous cruelty of the EU is destroying Greece
The turning point may have come this week with the latest intervention by Brussels: bureaucrats are threatening to bankrupt an entire country unless opposition parties promise to support the EU-backed austerity plan. By Peter Osborne in the Daily Telegraph (February 15, 2012).
Europe’s Crisis: Beyond Finance
Everyone is wondering about the next disaster to befall Europe. The financial crisis has several outcomes, all bad. The European crisis is one of sovereignty, cultural identity and the legitimacy of the elite. A perceptive analysis by George Friedman on STRATFOR.Read more: Europe's Crisis: Beyond Finance | STRATFOR
Research suggests ways to avoid financial crises
Officials should have the power to limit mortgages, apply tougher liquidity rules and cap banks’ leverage in order to prevent financial crises. By Claire Jones and Brooke Masters, in the Financial Times (December 20, 2011).
Democracy put to the test – La democracia puesta a prueba
In what looks like a new phase of the crisis, the tensions generated by the euro crisis are starting to destabilise European democracies. Almost two years of doubts and divisions, of a lack of the courage and political vision needed to adopt a European solution, are fuelling popular disaffection – as much towards national democracies as towards the European project itself. By José Ignacio Torreblanca on Open Democracy. Article first published in El Pais (November 13, 2011). Read the full article in English on: http://www.opendemocracy.net/jos%C3%A9-ignacio-torreblanca/democracy-put-to-test or in Spanish on http://www.elpais.com/articulo/internacional/democracia/puesta/prueba/elpepiint/20111113elpepiint_9/Tes.
Europeans migrate south as continent drifts deeper into crisis
Tens of thousands of Irish, Greek and Portuguese people leave in search of a new life as the eurozone's woes worsen. The Guardian (December 21, 2011). http://www.guardian.co.uk/world/2011/dec/21/europe-migrants-crisis-irish-portuguese
How Freedom Became Tyranny
Rightwing libertarians have turned “freedom” into an excuse for greed and exploitation, writes George Monbiot: http://www.monbiot.com/2011/12/19/how-freedom-became-tyranny/.
Does the EU bailout deal stand up to scrutiny?
Guardian’s Economics Blog (October 27, 2011): Any deal was better than no deal last night; but in the cold light of day, the question of why China would want to get involved in bankrolling the eurozone's unmanageable debts was just one of the questions emerging. Read: http://www.guardian.co.uk/business/economics-blog/2011/oct/27/eu-bailout-deal-scrutiny-critics.
The end of the euro?
More broadly, and more worryingly, recent developments significantly raise the (long-term) risk of a euro break-up, in our view. That’s what some Morgan Stanley analysts declared. From http://ftalphaville.ft.com/blog/2010/04/15/.
The cold, hard truth: the Euro is finished
By Frances Coppola on http://coppolacomment.blogspot.com/2011/10/cold-hard-truth.html. A summary version was also published on Liberal Conspiracy at http://liberalconspiracy.org/2011/10/25/the-cold-hard-truth-the-euro-is-finished/#comment-325040, generating a heated discussion on the days before and after the October 27 EU deal.
The futile attempt to save the eurozone
By Samuel Brittan in the Financial Times (November 4, 2010). Read on http://www.ft.com/cms/s/0/def42cae-e84b-11df-8995-00144feab49a.html#axzz14OWNbezW.
The Eurozone Heads for Break Up
The eurozone was glued together by the convergence of low real interest rates sustaining growth, the hope that reforms could maintain convergence; and the prospect of eventual fiscal and political union. But now convergence is gone, reform is stalled, while fiscal and political union is a distant dream. Writes Nouriel Roubini: http://www.economonitor.com/nouriel/2011/06/13/the-eurozone-heads-for-break-up/.
The Hole in Europe’s Bucket
By Paul Krugman in the New York Times (October 23, 2011). Krugman writes: For as one rescue plan after another falls flat, Europe’s Very Serious People… just keep looking more and more ridiculous… the European elite, in its arrogance, locked the Continent into a monetary system that recreated the rigidities of the gold standard, and — like the gold standard in the 1930s — has turned into a deadly trap.
The graphs that show why Europe is on the verge of collapse
For anyone who thinks that crushing the Greeks with even more debt and even more austerity will somehow ‘save’ europe’s insolvent banks here from Reuters is why it won’t.
This isn’t the fabled public debt wracked up by countless lazy, feckless layabouts doing nothing and expecting to be given flat screen televisions and hospital care they don’t deserve. This is debt created by, agreed to and marketed by private bankers throughout Europe – for which they received massive bonuses. Read more from David Malone on Liberal Conspiracy and watch the charts from Reuters (links in article). http://liberalconspiracy.org/2011/09/19/the-graphs-that-show-why-europe-is-on-the-verge-of-collapse/
Henkel: “Der Euro war ein Fehler”
Hans-Olaf Henkel war selbst "enthusiastischer Befürworter" des Euro. Nun attestiert der Ex-BDI-Chef der Währungsgemeinschaft schwere Konstruktionsfehler, warnt vor dem europäischen Zentralstaat und rechnet mit den ehemaligen Weggefährten in der Politik ab. 15 Juni 2011.; http://www.euractiv.de/finanzen-und-wachstum/artikel/henkel-die-euro-zone-war-ein-fehler-004957
A sceptic’s solution – a breakaway currency
Former Henkel’s chairman writes: Having been an early supporter of the euro, I now consider my engagement to be the biggest professional mistake I ever made. But I do have a solution to the escalating crisis. In Financial Times, August 29, 2011.
Can the EU survive?
Just for once, this is not a question best left to the Poli Sci. Because the main forces will be money/macro. For nearly two years now, I've been worried that one or more of the Eurozone countries might do an Argentina. I've been asking whether the Eurozone could survive.. I think it's time to change the question. Can the EU survive? A Canadian perspective from Nick Rowe (November 26, 2010). Read it at http://worthwhile.typepad.com/worthwhile_canadian_initi/2010/11/can-the-eu-survive.html#more.
(Why) should Scotland (not) be independent?
Blueprint for Scottish independence launched (November 26, 2013). http://www.theguardian.com/politics/2013/nov/26/scottish-indpendence-fairer-prosperous-alex-salmond
The European dream is in danger: prepare for another rude awakening
Today the political elites of Europe stand in danger once again of destroying a dream. They have convinced themselves the single currency and the European Union are the same project, and that the collapse of either would be the end of the world they know. Therefore it cannot end. This fallacy is now about to be tested, writes Paul Mason in the Guardian (May 24, 2011). Read on: http://www.guardian.co.uk/commentisfree/2011/may/24/european-dream-single-currency.
Hasn’t time come to consider a eurozone break-up?
Asks Mike Guillaume in the Economists Professional Network group on LinkedIn. “Have your thought about the costs?” replies Silvia Holgado Gomez. Read the heated discussion on http://www.linkedin.com/groupItem?view=&gid=2048967&type=member&item=53349007&qid=839ce558-e6ab-4884-9c9f-358eefeed4fd&goback=%2Egmp_2048967.
Why the eurozone will survive
By Martin Wolf, in the Financial Times (March 9, 2011).
Q&A: How did the euro zone get into its debt mess?
By Robin Emmott on Reuters (Sep. 20, 2011): http://www.reuters.com/article/2011/09/20/us-imf-eurozone-origins-idUSTRE78J3M620110920.
Zone euro: le remède va-t-il tuer le malade?
L'équation, de plus en plus insoluble, incite à réfléchir à un changement de cap. La zone euro a-t-elle choisi la bonne stratégie? Interroge Adrien de Tricornot dans “Le Monde” (4 avril 2011). Lire: http://www.lemonde.fr/economie/article/2011/04/04/zone-euro-le-remede-va-t-il-tuer-le-malade_1502573_3234.html#ens_id=1090253.
Pourquoi faut-il que les Etats payent 600 fois plus que les banques ?
Bloomberg montre que la Réserve fédérale a secrètement prêté aux banques en difficulté la somme de 1 200 milliards au taux incroyablement bas de 0,01 %. Au même moment, dans de nombreux pays, les peuples souffrent des plans d'austérité imposés par des gouvernements auxquels les marchés financiers n'acceptent plus de prêter quelques milliards à des taux d'intérêt inférieurs à 6, 7 ou 9 % ! Il faut en finir avec le deux poids, deux mesures : en nous inspirant de ce qu'a fait la banque centrale américaine pour sauver le système financier, nous proposons que la "vieille dette" de nos Etats puisse être refinancée à des taux proches de 0 %. Par Michel Rocard, ancien premier ministre français, et Pierre Larrouturou, économiste, dans Le Monde (2 janv. 2012): http://www.lemonde.fr/idees/article/2012/01/02/pourquoi-faut-il-que-les-etats-payent-600-fois-plus-que-les-banques_1624815_3232.html
Sortir de l’euro: un chiffrage pour la France (Leaving the eurozone : a cost estimate for France)
Le chiffrage de l’impact de la sortie de la zone Euro est extrêmement fragile. Le chiffrage correspond à une estimation de l’impact économique de la mesure proposée. Les effets sur les finances publiques du choc économique occasionné sont, à terme, beaucoup plus importants que l’impact budgétaire direct. Par l’Institut Montaigne : http://www.chiffrages-dechiffrages2012.fr/blog/2011/12/12/proposition-sortir-de-l%e2%80%99euro/.
Sortir de l’euro ou mourir à petit feu (Alain Cotta)
Alain Cotta, professeur d’économie à HEC, qui avait déjà fait part de son scepticisme sur le traité de Maastricht, dès 1992. Il revient à la charge avec un ouvrage, où il est question du sort de l’euro. Une monnaie unique qui ne fait plus l’unanimité et qu’il faut quitter, pour revenir à une monnaie commune ou au franc. Résumé sur: http://fortune.fdesouche.com/21139-alain-cotta-il-faut-sortir-de-leuro-et-vite.
The Eurozone Endgame: Four Scenarios
Ultimately, there will be a eurozone will greater shared fiscal authority, a common cross-border resolution authority for failed banks, and likely greater economic integration. But there are four scenarios regarding who ends up in that eurozone – and how we get there. By Peter Boone and Simon Johnson in http://baselinescenario.com/2010/11/28/the-eurozone-endgame-four-scenarios/.
The road to self-destruction of the eurozone
At recent European Council meeting, the member countries of the eurozone have agreed to introduce a sovereign debt default mechanism. They even seem to be willing to codify this into a new treaty. This is a bad decision that will make the eurozone more fragile by making financial crises an endemic feature of the eurozone, very much like the Exchange Rate Mechanism (ERM) that existed in the EU prior to the start of the eurozone. By Paul De Grauwe, on http://www.eurointelligence.com/
(November 18, 2010).
A Money Too Far
By Paul Krugman, in the New York Times (May 6, 2010).
Zone euro: de la convergence à l’éclatement?
Les premières années del’euro pouvaient laisser penser que les règles prévues par les traits suffiraient à assurer la convergence des economies sans nouveaux abandons de souveraineté nationale. La crise de 2008 a fait voler en éclats cet optimisme. Dans Alternatives Economiques (Octobre 2010).
The benefits of a eurozone breakup
So that is why we are saying if you could just break up this sort of corset that is holding the whole thing in, we would have more growth all around. Everybody would better off, states Christopher Smallwood, economist at Capital Economics (http://www.capitaleconomics.com/). Read the interview on Bloomberg on http://findarticles.com/p/news-articles/analyst-wire/mi_8077/is_20100712/christopher-smallwood-economist-capital-economics/ai_n54421867/.
Don’t blame the euro
With all the turbulence rocking the financial markets and the sharp drop in the euro’s exchange rate, you could almost forget that the single European currency has been quite a success, says Heleen Mees on http://www.eurointelligence.com/.
This is a crisis of the banking system, not the euro
The problem is partly that the causes of the crisis are misdiagnosed. This is primarily a crisis not of the euro, but of the global financial system. Not long ago, market fears focused on the dollar and the US Federal Reserve’s quantitative easing. And the key issue in Europe now is not the merits of the single currency but the parlous state of its banking system. States Philippe Legrain on http://www.eurointelligence.com/article/article/this-is-a-crisis-of-the-banking-system-not-the-euro.html?tx_ttnews%5BbackPid%5D=901&cHash=bd460ba1ff3d57300c4aefb17a30435b.
Faut-il sauver notre très cher euro?
le sauvetage de la monnaie unique coûte bien trop cher à l'Europe, et s'en affranchir pourrait nous éviter la catastrophe, écrit le Blogueur Associé sur http://www.marianne2.fr/ (12 mai 2010).
Fixing the Flaws in the Eurozone
With news that Ireland has applied for a bailout worth tens of billions or euros, the dark predictions for the future of the Eurozone grow ever bleaker. This column argues that the problems in the Eurozone’s periphery expose a flaw in its design. It proposes that the ECB set different interest rates for different member countries to help make matters better before they get any worse. By Stanley W Black (November 23, 2010). ON http://www.voxeu.org/index.php?q=node/5838.
Befrieren Sie den Euro
Seit Tagen präsentiert sich die EU als Retter: Wir helfen Irland! Doch hinter den Kulissen wird hart gerungen, die Gemeinschaftswährung schwebt längst wieder in Lebensgefahr. Und der alte Kontinent hat keinen Plan, wie er sie retten soll. Von Peter Ehrlich und Claus Hecking (November 18, 2010): http://www.ftd.de/politik/europa/:agenda-befreien-sie-den-euro/50195693.html
The Making of a Euromess
The real story behind Europe's troubles lies not in the deficit but in the policy elites who pushed the Continent into adopting a single currency before it was ready. By Paul Krugman in the New York Times (February 14, 2010). Read the Op-Ed on http://www.nytimes.com/2010/02/15/opinion/15krugman.html?partner=rssnyt&emc=rss
Eight scenarios how the unthinkable might happen. In this briefing note we are asking whether the euro area could ever break up. We think not. But we are not as certain as we used to be. A download of this very interesting paper (published in April 2009) may be done from http://www.eurointelligence.com/.
Germany's Merkel: She's Got the Whole Euro in Her Hands
As head of Europe's biggest economy and the country that has ladled out billions to support the European Union, she has emerged as the key player in the drive to save Greece from default. Good analysis in BusinessWeek (February 17, 2010) on http://www.businessweek.com/.
Angela Merkel has the whip hand in an orgy of austerity
The notion that economic pain is the only route to pleasure was once the preserve of the British public school-educated elite, now it's European economic policy. By Larry Elliott, economics editor in the Guardian (January 8, 2012): http://www.guardian.co.uk/business/economics-blog/2012/jan/08/eurozone-crisis-angela-merkel-whip-hand?CMP=twt_fd
Germany faces two alternatives: Relax the terms of the EU rescue packages or to allow crisis countries to write down their heavy debt, with losses for German banks and elsewhere. By Barry Eichengreen on http://www.eurointelligence.com/article/article/germanys-choice.html?tx_ttnews%5BbackPid%5D=901&cHash=af3031639a3b431f7d237567c3dd066d.
Work more, play less, Merkel tells southern Europe
German Chancellor Angela Merkel has responded to voter anger about eurozone bailouts by saying that people in southern Europe should retire later and take fewer holidays, press reports said on Wednesday (http://www.eubusiness.com/news-eu/finance-economy.a17, May 18, 2011).
Deutschland über Europa
Up to recently, the German policy, whatever the government, could be summed up as: “What’s good for Europe is good for Germany.” The shift of these last weeks is increasingly regarded as a move in a more self-centred direction. Or : “What’s good for Germany should be good for Europe.” By Mike Guillaume. For the PDF click here.
How Germany could come to kill the euro
By Gideon Rachman, in the Financial Times (November 22, 2010).
Germany: Looking for Bismarck
The current crisis is providing Germany with one of the best opportunities to make its control over the eurozone explicit, before its own demographic problems catch up with it. Germany essentially has a limited window of opportunity in the next 10 years to make or break its leadership of the European Union and therefore its claim to global relevancy. Wrote Stratfor e-mail news (March 26, 2010). More on http://www.stratfor.com
Why Germany cannot be a model for the eurozone
By Martin Wolf, in the Financial Times (March 30, 2010). On http://www.ft.com.
Pour sauver la zone euro, il faut que l’Allemagne la quitte
L'Allemagne profite de l'euro pour acheter pas cher à l'extérieur, et revendre cher dans la zone euro. Cela représente 45% de ses exportations et pénalise les autres pays, dont la France. Comment faire? Par Bernard Maris, économiste, sur http://www.marianne2.fr/.
Serait-ce la catastrophe annoncée si la France sortait de la Zone Euro ?
Philippe Murer, professeur vacataire de Finance à la Sorbonne, président de l’association Manifeste pour un débat sur le Libre Echange, essaye d’examiner la question froidement, de façon technique. http://www.marianne2.fr/Serait-ce-la-catastrophe-annoncee-si-la-France-sortait-de-la-Zone-Euro_a213023.html
Les piig’s ou l’Europe des Untermenschen
Roland Hureaux s'inquiète du succès de l'expression «piig's», qui stigmatise les pays qui ne peuvent adopter le modèle de l'Europe du Nord. Il explique pourquoi il fallait s'en tenir à la monnaie commune et comment, en imposant l'euro, l'Union européenne a reproduit les erreurs du modèle soviétique. Lire: http://www.marianne2.fr/Les-piig-s-ou-l-Europe-des-untermenschen_a205492.html.
Scenarios of an Italian default
Among those countries exposed to liquidity crisis, Italy is the one under stronger pressures with a debt to maturity in 2012 for over €300 billion (plus, emissions of new debt). Most of it should be raised by March (more than €115 bn). By Diego Valiante on Eurointelligence (December 14, 2011): http://www.eurointelligence.com/eurointelligence-news/home/singleview/article/scenario-of-an-italian-default.html.
The challenge to German liberalism
Thilo Sarrazin… has just written what is probably the bestselling political book in postwar Europe (1m copies in hardback and counting). Everyone in Germany knows at least a simplified version of what Germany Abolishes Itself says. An in-depth review of the book, its origins and its impact by David Goodhart in Prospect Magazine (November 17, 2010): http://www.prospectmagazine.co.uk/2010/11/thilo-sarrazin-germany-immigration-multiculturalism-review/.
La crisis del euro: El deudor reticente
La presión de sus socios (ahora acreedores) de la eurozona, temerosos del contagio hacia otros periféricos que sí tienen necesidad de financiarse ahora, ha terminado convenciendo al deudor. En http://www.elpais.com/articulo/economia/deudor/reticente/elpepieco/20101123elpepieco_2/Tes.
Is Ireland solvent?
Whether or not Ireland is solvent depends on future growth and tax revenues to service the debts. We are looking at various scenarios, and assess the implications. By Wolfgang Münchau und Raphael Cottin (November 24, 2010) on http://www.eurointelligence.com/.
S&P warns of unsure future for Irish debt
By John Murray Brown, in the Financial Times (February 2, 2011).
Ireland left with nowhere to go, damned if it does, damned if it doesn’t
Consequently, it has nowhere to go. If it tightens fiscal policy to reduce the deficit, output growth will be even weaker in the short-term, pushing the deficit back up again. And if it cuts taxes or increases spending to boost economic activity, the deficit will also increase. Read on http://www.leftfootforward.org/category/sustainable-economy/.
In keeping with Halloween, here's a scary one
The Irish Government has taken a three-month holiday from borrowing, instead running down reserves of cash borrowed earlier in the year... This debate is one that we cannot join, unfortunately... We cannot do that, nor can we devalue our exchange rate, since we do not have one..., says Irish economics professor Colm McCarthy in the Irish Independent (October 31, 2010). http://www.independent.ie/opinion/analysis/in-keeping-with-halloween-heres-a-scary-one-2401299.html.
Ireland: more than half of all jobs for young men have disappeared
In total about 55% of jobs for young men have disappeared in the last three years. In some parts of the country, up to two-thirds of young men are now signing on. By Ronan Lyons on www.ronanlyons.com.
An Irish default is unavoidable: the debt burden is too great
There's been an enormous national reluctance to assess whether Ireland can get through its present economic crisis without having to default and, if not, what form that default might take and the effects it would have. More on www.feasta.org.
Greece and Portugal should both go gracefully
By Simon Tilford in the Financial Times (May 12, 2011).
Bankers Gone Wild in Ireland... and Germany
German banks are owed $139 billion, which is 4.2 percent of German G.D.P. Where were the German regulators?... Not only has the Irish crisis blown apart the myth of the virtues of fiscal austerity during rapidly declining economic activity, but it has also illustrated that Germany’s bankers were every bit as culpable as their Irish counterparts in helping to stoke the credit bubble. By Marshall Auerback, a hedge fund manager and portfolio strategist who writes for www.newdeal20.org on Naked Capitalism (November 29, 2010): http://www.nakedcapitalism.com/2010/11/marshall-auerback-bankers-gone-wild-in-ireland-and-germany.html.
Is Italy Europe's Bigger Problem?
Nobel-winning Columbia professor Robert Mundell, considered the "father of the euro," said in an interview this week that Greece isn't Europe's biggest problem these days. He believes that honor goes to Italy. By Daniel Costello on Planet Money Blog: http://www.npr.org/blogs/money/2010/02/is_italy_europes_bigger_proble.html.
Cinq petits cochons (Five little pigs)
Ce n'est plus seulement le titre d'un roman, c'est désormais la plus dangereuse crise de l'union européenne depuis le passage à l'euro. Les pays européens qualifiés élégamment de PIIGS (Portugal, Italie, Irlande, Grèce, Espagne) font l'objet depuis une semaine d'attaques spéculatives, marquées... surtout par des tensions sur les marchés obligataires, et une montée du cours des credit default swaps (CDS) sur les obligations publiques. Le principal pays en ligne de mire est actuellement la Grèce mais d'autres pays sont sous pression: les autres PIIGS, mais aussi la Belgique ou L'Autriche. Sur le blog d'éconoclaste: http://econoclaste.org.free.fr/dotclear/index.php/?2010/02/08/1698-cinq-petits-cochons
Athens Finanzmisere bedroht europäische Banken
Für das krisengeplagte Griechenland scheint Hilfe nah. Hinter der geplanten Rettungaktion stehen auch Sorgen um den Bankensektor: Institute aus Europa sind wichtige Gläubiger des Staats und seiner Bürger, vor allem jene aus der Schweiz und Frankreich, von Christine Mai, in FT Deutschland: http://www.ftd.de/finanzen/maerkte/anleihen-devisen/:risiko-athens-finanzmisere-bedroht-europaeische-banken/50072251.html
A Greek bailout: is it legally possible and what will it cost EU taxpayers?
Open Europe argues that an EU-led bailout will come with huge economic and political risks, and will for the first time make Europe's taxpayers fully liable for an individual country's debts, while centralising new economic powers at the EU-level. Read on http://www.openeurope.org.uk/.
How Goldman Sachs Helped Greece to Mask its True Debt
Greek Finance Minister George Papaconstantinou speaking at a conference in January (www.spiegel.de) by Beat Balzli in Spiegel Online (February 8, 2010): http://www.spiegel.de/international/europe/.
Mario Draghi and Goldman Sachs, Again
The Bank of Italy pointed out that Mario Draghi (its current governor) did not join the management of Goldman Sachs until 2002 – hence he was not there when the controversial Greek “debt swaps” were arranged. We agree that he joined Goldman only in January 2002 (this was in our original post). But the latest revelations regarding the Goldman-Greece relationship (on the Senate floor, no less) clearly indicate that Goldman was a lead manager of Greek debt issues in spring 2002, i.e., when Mr. Draghi was on board. More on http://baselinescenario.com/2010/03/17/mario-draghi-and-goldman-sachs-again/.
A Greek Tragedy or a European Farce? Time to Re-Write the Script
In the official account of the unfolding Greek tragedy the villain is readily identified, the plot is clear, and the dénouement inevitable, tragic, but ultimately both just and morally uplifting. The villain of the piece is Greece itself… Other leading roles in the drama are played by gullible European policymakers who admitted the country, under false pretenses, into the euro club. Cassandra is played by the European Central Bank, warning of the perils of transgressing against the iron laws of actually existing monetary union. Bondholders, 'the markets', and fiscally prudent countries have heroic roles as fearless tellers of truth to power. By Andrew Watt, on http://www.social-europe.eu/2010/02/.
Athens dinner that led to political indigestion
By Sam Jones, hedge fund correspondent, in the Financial Times (March 4, 2010).
What Greece Thinks About Globalization
Greece, a European country in the Mediterranean, known for its ancient culture, beautiful landscapes, and delicious food, provides a rather complex case study on globalization. A detailed review on http://www.globalization101.org/.
A Greek crisis is coming to America
It began in Athens. It is spreading to Lisbon and Madrid. But it would be a grave mistake to assume that the sovereign debt crisis that is unfolding will remain confined to the weaker eurozone economies. By Niail Ferguson, in the Financial Times (February 10, 2010). On http://www.ft.com/.
Grèce et déficits: la revanche des marchés sur les Etats
La gestion de la crise grecque témoigne d'un phénomène en plein essort selon l'économiste Gabriel Colletis : la défense des activités de spéculation par les financiers. Les marchés s'attaquent pour cela à une nouvelle cible : les Etats. Avec, en ligne de mire, la réduction des dépenses et du déficit public. Par Gabriel Colletis, professeur déconomie à Toulouse 1. Article: http://www.marianne2.fr/Deficit-la-revanche-des-marches-sur-les-Etats-2-2_a189579.html. Blog: http://www.mediapart.fr/club/blog/Gabriel%20Colletis.
A Greek bail-out at last but no real solution. Greece will default, but not this year
By Wolfgang Munchau, in the Financial Times (April 4 and 11, 2010). On http://www.ft.com
By Aline van Duyn, in the Financial Times (Short View) (April 7, 2010). On http://www.ft.com.
Greece wouldn’t find it easy to leave the Euro
The crisis threatening to spread out from Greece to the other vulnerable members of the single currency has exposed a problem. Europe has copious and precise rules for countries wishing to join the monetary union. There are no contingencies for a country that wants to leave. By Larry Elliott, Economics editor, the Guardian, on http://www.guardian.co.uk/world/2010/apr/29/greece-euro-debt-crisis.
The Greek crisis and the future of the eurozone
The crisis that started in Greece culminated into a crisis of the Eurozone as a whole. There is no doubt that the major responsibility rests with the Greek authorities who mismanaged their economy and deceived everybody about the true nature of their budgetary problems... This being said, there is more than one villain in the play. The financial markets and the eurozone authorities also bear part of the responsibility for letting this crisis degenerate into a systemic crisis of the eurozone. The destabilizing role of financial markets has been illustrated dramatically again... Financial markets are first blinded and see no risks, until the wake-up call and then they overreact making the resolution of the problem more difficult. By Paul De Grauwe on http://www.eurointelligence.com/article.581+M56693ac617c.0.html.
Another Greek tragedy? Time for Europhiles to admit the dream is over
It seems that from the Greek crisis, only three scenarios might occur. And all of them qualify as “worst case”. An extended version of Mike Guillaume’s article published in Lib Dem Voice (http://www.libdemvoice.org/ for the Op-Ed and the comments). For the PDF click here.
Greece and Portugal Debt Crisis, Euro An Anchor of Stability?
The world’s attention is on the fiscal malaise in Greece and Portugal. In our assessment, what we see unfolding is a sign of greater instability to come. That said, writing off the euro may be premature; as global dynamics play out, we believe the euro may yet prove to be an anchor of stability. That’s what Axel Merk thinks. Read his full article on http://www.marketoracle.co.uk/Article17091.html.
EU warns Portugal and says bloc needs permanent crisis fund
By Andrew Willis, on http://euobserver.com/9/29861 (April 14, 2010)
Monatelang haben Politiker und Notenbanker um Hilfen für Griechenland gerungen. Sie waren Getriebene: Während sie kämpften und stritten, spekulierten Hedge-Fonds und Banken gnadenlos gegen den Pleitekandidaten und den Euro. Chronik eines europäischen Dramas. In http://www.ftd.de/politik/europa/ (April 26, 2010).
Three years on –and the markets are masters again
Families are paying the bankers’ bills through rising taxes, shabbier public services and higher unemployment, comments Philip Stephens in the Financial Times (July 30, 2010).
“Bank’s riskier activities were economically useless”
Adair Turner, chairman of Britain’s Financial Services Authority (in a speech at Oxford Cass Business School, on March 17, 2010)
Il faut définanciariser l’économie
Il faut considérer que les prix financiers ne fournissent pas de bons signaux aux acteurs économiques. C'est cette inadéquation des prix financiers qui est à l'origine des déséquilibres que nous connaissons, y compris macroéconomiques. Si ce diagnostic est exact, alors le capitalisme financiarisé, qui a pour trait distinctif de faire jouer un rôle central aux prix financiers dans sa régulation, doit être abandonné. Par André Orléan, directeur d'études à l'Ecole des hautes études en sciences sociales (EHESS), dans « Le Monde » (06/12/2011).
A New Middle East?
Long characterized as region run by autocratic leaders, the Middle East is on the dawn of a new era. Is or was? Read more at http://www.globalization101.org/news1/Middle_East (The Levin Institute, The State University of New York).
Arab Spring, Islamist Summer … Feminist Fall?
Nine months after the overthrow of the former president, Tunisia has voted in the first open and fair election in the region. In part one of a three part article Kristine Goulding asks: Is a Tunisian feminist fall, driven by local, national and international support, possible? Or will countervailing forces of politics, social pressure and religion prevail? See e.g.: http://www.opendemocracy.net/5050/kristine-goulding/tunisia-womens-winter-of-discontent and http://www.spiegel.de/international/world/0,1518,800447,00.html.
Twitter sells major stake to Murdoch-linked Saudi prince
Prince Alwaleed bin Talal, Arab world's richest man, sinks £300m into site, acquiring 37.5% of Twitter shares. More at: http://www.bloomberg.com/news/2011-12-19/prince-alwaleed-kingdom-pay-300-million-for-strategic-stake-in-twitter.html and http://www.guardian.co.uk/world/2011/dec/20/twitter-shareholder-rupert-murdoch
Arab spring will not see an economic bloom
By Arvind Subramanian, senior fellow at the Peterson Institute for International Economics, in the Financial Times (February 22, 2011)).
Arab Spring, American Fall
In the Arab Spring, popular movements seized the day. In America, it will in all probability take a major collapse of the financial system itself, brought about not by protest but by internal contradictions, for any meaningful change to occur. By Jim Garrison, on The Huffington Post (November 30, 2011): http://www.huffingtonpost.com/jim-garrison/arab-spring-american-fall_b_1120902.html
How much oil does Saudi Arabia actually have?
Is it 260bn or 550bn barrels? Should we believe the Americans or the Saudis? The answer may lie in the provenance of the information. By John Vidal, in Environment Blog on http://www.guardian.co.uk/environment/blog/2011/feb/15/oil-saudi-arabia-reserves.
We won't trouble Saudi's tyrants with calls to reform while we crave their oil
Did we miss it, or do they believe that change is less necessary in Saudi Arabia than it is in Libya? If so, on what grounds? The democracy index published by the Economist Intelligence Unit places Libya 158th out of 167, and Saudi Arabia 160th. At least in Libya, for all the cruelties of that regime, women are not officially treated as lepers were in medieval Europe. By George Monbiot, in The Guardian (March 15, 2011): http://www.guardian.co.uk/commentisfree/2011/mar/15/no-call-for-reform-saudi-oil?commentpage=last#end-of-comments.
CO2 emissions since 1820
Watch the graph on http://www.gapminder.org.
The Moral Case for Nuclear Power
Abandoning nuclear at a time of escalating emissions is far more dangerous than maintaining it, states George Monbiot in the Guardian (August 8, 2011). Read a short version on http://www.guardian.co.uk/environment/georgemonbiot/2011/aug/08/greens-renewables-climate-change and the full article at http://www.monbiot.com/2011/08/08/the-moral-case-for-nuclear-power/.
Global carbon emissions to rise 43 percent by 2035, says US report
Global emissions of carbon dioxide will grow by 43 per cent by 2035 if current patterns of energy usage continue and no global restrictions are applied, according to the latest figures from the US Energy Information Administration.
The emissions rise will be driven by a 49 per cent increase in the world’s energy consumption over the same period. Developing Asia will account for 35 per cent of the increase. From: http://www.businessgreen.com/business-green/news/2263703/global-carbon-emissions-rise.
The climate crisis of the 21st century has been caused by just 90 companies
Chevron, Exxon and BP among companies most responsible for climate change since dawn of industrial age, figures show. http://www.theguardian.com/environment/2013/nov/20/90-companies-man-made-global-warming-emissions-climate-change!
Climate Change and Peak Oil are Intimately Related and Require Urgent Action
Due to continued government inaction around the world, climate change and peak oil (oil depletion) are now fast looming as two of the greatest challenges ever faced by humanity. By Greg Grochola on http://thezeitgeistischanging.blogspot.com/2010/11/climate-change-and-peak-oil-are.html.
Climate Skeptic Refutes Self, Confirms Antartica Warming
If the ice on Antarctica melts, the oceans will rise several meters, inundating low islands and coastal regions. There is a controversy about the rate at which Antarctica is warming. Read at: http://thezeitgeistischanging.blogspot.com/.
Not only governments are to blame for exploding government debts
Although, governments certainly bear responsibility for the crisis, this is only part of the story. It fails to take into account the fact that the financial crisis erupted because of unsustainable increases in private debt (of households and financial institutions) forcing many governments to pick up the pieces. In addition, blaming national governments for the macroeconomic divergences within the Eurozone fails to take into account that the origin of these divergences has little to do with what governments did or did not do, writes Paul De Grauwe on EuroIntelligence (November 4, 2010): http://www.eurointelligence.com/index.php?id=581&tx_ttnews[tt_news]=2944&tx_ttnews[backPid]=901&cHash=b7b4955ac6.
La dette n’est pas soluble dans l’eau
Par François Leclerc, sur le Blog de Paul Jorion (22/11/2010). Le cas de l’Irlande est un cas d’école. Deux raisons concourent à son sauvetage européen, lui-même justifié par la nécessité de protéger la zone euro. Et deux vecteurs possibles de contagion au sein de celle-ci ont été clairement mis en évidence. Le premier est l’interconnexion de l’endettement bancaire, le second celui du financement de la dette des Etats par les banques. Sur : http://www.pauljorion.com/blog/?p=18663#more-18663
Assets matter just as much as cutting debt
By Martin Wolf, in the Financial Times (November 26, 2010). www.ft.com.
Les prix (du thé etc.) sont determinés par l’offre et la demande, épisode XLII
En me baladant sur rue 89, je tombe sur la question-réponse suivante : pourquoi le thé coûte-t-il aussi cher dans les cafés et restaurants? La réponse montre à quel point les gens sont éloignés du raisonnement économique le plus basique. La réponse apportée, en effet, se contente d'essayer d'établir un prix de revient du thé servi dans un bistrot, en le comparant avec celui d'un café, pour constater que le prix de vente est hors de proportion avec le prix de revient, ce qui signifie, bien entendu, que les cafetiers se font des appendices reproducteurs en or sur le dos des clients. Par Alexandre Delaigne sur le blog d’éconoclaste. http://econoclaste.org.free.fr/dotclear/index.php/?2011/02/08/1766-l-offre-et-la-demande-nom-d-une-pipe.
How India’s growth will outpace China’s
Despite all the mess and chaos of India, the country’s business is booming. This will change the world. Briefing in The Economist (October 2, 2010).
India jumps on CSR legislation bandwagon
By Andrew Newton on http://www.apesphere.com/ (September 13, 2010).
It is time to plan for the post-Keynesian era
By Jeffrey Sachs, Financial Times (June 8, 2010).
Keynes vs. Alesina. Alesina Who?
Alberto Alesina is a new favorite of fiscal hawks like former President George W. Bush's chief economic adviser, N. Gregory Mankiw. A professor of economics at Harvard University, the 53-year-old Italian disputes the need for more government spending to prop up growth and advocates spending cuts instead. Read more in BusinessWeek article by Peter Croy (June 30, 2010). http://www.businessweek.com/magazine/content/10_28/b4186012969951.htm?chan=rss_topStories_ssi_5.
National societies become less flat
Domestically’, globalisation implies that especially by labour migration, national societies become more global, more diverse, more ’strange’, more fragmented and heterogeneous. So we witness a dialectics of more ’familiarity’ and more ’strangeness’ at the same time, caused by the same factors that New York Times columnist Thomas Friedman diagnosed in his visionary book “The World is Flat”. To sum up: the dialectics of globalisation is one of the root causes for the European Revolt of Populism. Writes Rene Cuperus in Social Europe Journal (November 2010): http://www.social-europe.eu/2010/11/national-societies-become-less-flat/.
Politicians beware, the squeezed middle is here to stay
More pressure on the middle classes.
By Max Hastings, Financial Times (October 17, 2010).
Cable-nomics: a reader
Business lobby groups and the righ-wing press have got their teeth into Vince Cable today for his remarks about capitalism. Conservative Home have even dubbed him “Red Vince“. But the Business Secretary is just conveying cutting edge thinking on models of capitalism and vested business interests are right to be worried. The view is less controversial than the howl of anguish from the CBI would suggest. A series of books in recent years have set out the thesis behind Cable-nomics. None of the authors can remotely be described as “reds”. These books include “The Seven Deadly Sins of Capitalism” by Mike Guillaume. Read more on http://www.leftfootforward.org/2010/09/cable-nomics-a-reader/.
When financial markets force too much austerity
This time financial markets do exactly the opposite of what they did prior to the eruption of the crisis. They now judge an increasing number of government bonds to be highly risky, leading investors to sell these bonds and precipitating a debt crisis in the Eurozone. But if financial markets and rating agencies were so spectacularly wrong prior to the crisis, when they underestimated risks, why would they be right now? Questions Paul De Grauwe on www.eurointelligence.com.
The New Pioneers
Sustainable business success through social innovation and social entrepreneurship. A handbook for business unusual in the new economic world order, written by Tania Ellis. The book is a practical guide for capitalists and idealists on how to navigate in the new economic world order. More on www.thenewpioneers.biz.
The $1 trillion question about the Greek “rescue”
What would have been the cost of adjustment measures (a) had the Greek crisis been resolved quicker; (b) had the eurozone not been in place (devaluation measures, etc.)? The question is asked by Mike Guillaume in the Economist of the World discussion group on www.linkedin.com.
A marathon to sprint
David Gardner and Kerin Hope about the chances of a solution to the Greek crisis, in the Financial Times (July 30, 2010).
Now It’s a European Banking Crisis
While the EU hesitated on a remedy for Greece's debt woes, a virus spread As it spread, markets started to pummel European banks and insurers for their exposure to what could prove to be one of the worst sovereign debt disasters ever. A bank crisis and a debt crisis rolled into one. On www.businessweek.com (April 29, 2010).
Banking needs more robust stress tests than these
By John Kay, in the Financial Times (July 28, 2010).
Cash calls expected as Europe’s banks face tests
By Patrick Jenkins and Daniel Schäfer in the Financial Times (July 1, 2010).
German banks expected to call on rescue fund
By Gerrit Wiesmann, Patrick Jenkins and David Oakley in the Financial Times (June 30, 2010).
Economics may be dismal, but it is not a science
By John Kay, in the Financial Times (April 14, 2010).
Why Obama Should Learn the Lesson of 1936, not 1996
By Robert Reich, (November 1, 2010) on http://robertreich.org/post/1457186913.
Two Fat Tails: Inflation and Deflation. We Simply Do Not Know
So here we are, stuck, like Buridan’s ass, between the two fat tails of inflation and deflation, writes Dan Aronoff on http://scepticalmarketobserver.blogspot.com/.
The Origins and Development of the Economic Crisis
As the banking crisis emerged upon a startled world, I became increasingly horrified at the actions of governments in response to the crisis. I argued strongly that the response to the crisis would eventually backfire on sovereign states, and we are watching this process now unfolding. My analysis of the situation... is that the banking crisis was a symptom of an economic crisis, not the cause of an economic crisis. That’s how Cynicus Economicus introduces his very interesting perspective on http://cynicuseconomicus.blogspot.com/ (May 23, 2010).
A credo for a revived capitalism
At some stage it will be necessary to look beyond bail-outs and emergency packages and ask what kind of capitalism should emerge after the present crisis, writes Samuel Brittan in a well-inspired column in the Financial Times (May 6, 2010).
Capitalism in the Future: Lessening old Hazards, Regaining Former Strengths
Levin Institute President, Garrick Utley interview Martin Wolf, Chief Economics Commentator, Financial Times, and Edmund Phelps McVickar Professor of Political Economy, Columbia University on http:/www.globalization101.org/experts/capitalism_strengths.
Spanish Crisis Raises Bailout Fears
In The Independent and BusinessWeek (june 17, 2010).
Warum die spanischen Sparkassen ein Risiko für den Euro sind
Erst Griechenland, jetzt die Iberer? Der Kapitalmarkt sorgt sich um den Bankensektor des Spaniens. In Financial Times Deutschland (May 26, 2010). On www.ftd.de.
Figures that surprise –or don’t?
In the US… in cash terms, national income has risen $200 billion since the depths of the recession in March 2009. But corporate profits have risen by $280 billion over that period, while wages are down by $90 billion. One would have to go back to the 1950s to find profits outperforming wages in absolute (cash) terms… In Britain, national income rose $27 billion in the last two quarters of last year. Profits were up £24 billion and wages just £2 billion. From Buttonwood on http://www.economist.com/blogs/buttonwood/2010/03/
Giles Wilkes’s comment on http://freethinkingeconomist.com/: This has not been a bad recession for capitalists.
The post-crisis outlook. Banks in crisis: 1929 and 2007
The 1929 banking crisis that launched the Great Depression was caused by stressed banks whose highly leveraged retail borrowers were unable to meet margin calls on their stock market losses, resulting in bank runs from panicky depositors unprotected by government insurance. In the 1920s, there were very few traders other than professional technical types. By contrast, the 1990s and 2000s were the decades of the day trader and big-time institutions. By Henry C K Liu, in Asia Times. Read more on http://www.atimes.com/atimes/Global_Economy/LD14Dj03.html.
Time to take Wall Street out of Washington
By Robert Reich, former U.S. labor secretary and professor at the University of California at Berkeley. In the Financial Times (April 26, 2010).
Time to get personal about the financial crisis
Those statistics are always worth repeating:
- an increase in the number of people around the world in chronic hunger and poverty by over 100 million, to 1.02 billion;
- between 200,000 and 400,000 more babies could die each year between now and 2015 if the crisis persists;
- an increase in global unemployment by between 29 million and 59 million people;
- one in eight US mortgage borrowers is behind on mortgage payments or facing foreclosure at the end of the second quarter 2009;
- pensioners relying on developed country stock market returns for their retirement incomes have seen their savings fall by 45%.
But all this talk of aggregates repeats part of the problem that got us into this mess in the first place. Aggregates create emotional distance. They enable us to forget that the crisis both impacts and was brought about by individuals. By Andrew and Angela Newton on Apesphere. Read more on http://www.apesphere.com/.
Crise: le système est au bord du gouffre? Faisons un pas en avant!
Pourquoi s'évertuer à vouloir sauver un système financier qu'on devrait plutôt remettre en cause et refonder? Le blogueur Laurent Pinsolle retranscrit les propositions d'intellectuels venus de tous bords pour concevoir la finance d'une autre façon. En lui donnant des règles. Sur: http://www.marianne2.fr/Crise-le-systeme-est-au-bord-du-gouffre-Faisons-un-pas-en-avant!_a192234.html.
El riesgo espanol se dispara
La desconexión total entre los discursos de los políticos y las acciones de los inversores se hizo patente ayer. En http://www.elpais.com/articulo/economia/riesgo/espanol/dispara/elpepieco/20100506elpepieco_1/Tes/.
The rating agencies have also failed to learn the lessons... Or maybe they are simply turning a blind eye on the likely impact of the recession and dollops of bailout packages on government finances. Since Greece is passé, Spain and Ireland still enjoy very high rating despite their economy being in shambles. By Kunal Kumar Kundu on Kunal's thoughts: http://kunalsthoughts.weebly.com/1/archives/12-2009/1.html.
Ratings agencies’ Nixon moment
Conflict of interest concerns raised. Agencies ‘acted in favour of banks’ in the Financial Times (April 25, 2010). Read also internal e-mail leaks. Astonishing, isn’t it¿ Or is it?
Should financial markets dictate budgetary policies in the eurozone?
The crisis that started in Greece culminated into a crisis of the eurozone as a whole. It may find a temporary resolution... The crisis has made clear that the financial markets... will continue to dictate the speed with which the eurozone governments are reducing their budget deficits and debt levels. By Paul De Grauwe in the Economists’ Forum (Financial Times, March 15, 2010, on http://blogs.ft.com/economistsforum/).
ECB must re-examine its dependence on rating agencies
By Erik Nielsen, Chief European Economist at... Goldman Sachs, in the Financial Times Insight column (March 25, 2010).
China and Germany unite to impose global deflation
By Martin Wolf, in the Financial Times (March 16, 2010). On http://www.ft.com.
Can the US Escape Another Lost Decade?
A greater possibility of a double dip? By Kunal Kumar Kundu on http://kunalsthoughts.weebly.com/.
Greenspan: 'I was right 70% of the time'
In testimony before the Financial Crisis Inquiry Commission, Greenspan said the recent financial meltdown was possibly "the most severe in history." He admitted that regulators failed to grasp the severity of the crisis, but he maintained that his policies and predictions were correct most of the time. Story on http://money.cnn.com/2010/04/07/news/economy/Greenspan.
A.I.G., Greece, and Who's Next?
As Greece has tottered on the brink of fiscal chaos, threatening to drag much of Europe down with it, Wall Street's role in the fiasco has drawn well-deserved scorn. New York Times Editorial (March 4, 2010), on http://www.nytimes.com/2010/03/05/opinion/05fri1.html?hp.
Why do Finland's schools get the best results?
In 2006, Finland's pupils scored the highest average results in science and reading in the whole of the developed world. In the OECD's exams for 15 year-olds, known as PISA, they also came second in maths, beaten only by teenagers in South Korea. This isn't a one-off: in previous PISA tests Finland also came out top. On http://news.bbc.co.uk/2/hi/programmes/world_news_america/8601207.stm.
The Uneducated American
Until now, the results of educational neglect have been gradual — a slow-motion erosion of America's relative position. But things are about to get much worse, as the economic crisis … deals a severe blow to education across the board. By Paul Krugman, in his Op-Ed Column in the New York Times. Read the full column on: http://www.nytimes.com/2009/10/09/opinion/09krugman.html
Upper Mismanagement Why can't Americans make things? Two words: business school.
By Noam Scheiber. In The New Republic (December 18, 2009). http://www.tnr.com/article/economy/wagoner-henderson
California and Kazakhstan –just who is the underdog?
The real Kazakhstan, although not problem-free, looks fairly solid compared to California and many other states, writes Spencer Jakab in the FT (April 3, 2010).
Financial Reform Endgame
... all momentum for serious banking reform has been lost, wrote Paul Krugman in the New York Times (March 1, 2010).
Time to outlaw credit default swaps
I generally do not like to propose bans. But I cannot understand why we are still allowing the trade in credit default swaps without ownership of the underlying securities. Especially in the eurozone, currently subject to a series of speculative attacks, a generalised ban on so-called naked CDSs should be a no-brainer. By Wolfgang Munchau in the Financial Times (February 28, 2010).
10 innovations that will reshape business
From blue-sky computing to less greed (really?) to smater energy sources. By FT writers on http://www.ft.com (February 26, 2010).
The green debate goes tribal
Climate change believers and sceptics are two sides of the same coin – it is logical that one will always hate the other. By Giles Wilkes in The Guardian (February 4, 2010) on http://www.guardian.co.uk/commentisfree/cif-green/2010/feb/04/climate-change-denial.
Bankers' bonuses (again)
Cartoon by Kipper Williams on http://freethinkingeconomist.com/.
The banks get away with it again
By Philip Stephens, in Financial Times (April 12, 2011)
Gordon Gekko Lives: New Evidence That Greed is Rampant on Wall Street
One in four bankers would cheat to make $10 million. This is one of many unsettling findings in a new survey of Wall Streeters. In Time magazine (July 17, 2013): http://business.time.com/2013/07/17/gordon-gekko-lives-new-evidence-that-greed-is-rampant-on-wall-street/!
La finance est devenue une pensée de la vie
Aujourd’hui, la tendance est à l’homogénéisation, à l’unification de toutes les sphères avec, au centre du système, la finance, l’évaluation financière, les droits financiers… Tous les aspects de notre vie d’aujourd’hui, sont plus ou moins liés à ces questions financières. Cela modifie profondément le système car il n’y a plus vraiment de contre-pouvoir face à l’omniprésence de la finance. Par André Orléan, sur www.marianne2.fr (20 mars 2010).
Bernard Madoff, the financiers’ fall guy
The disgraced Ponzi schemer provides convenient cover for the bankers who defrauded us all – yet are still collecting bonuses. By Paul Harris in The Guardian on http://www.guardian.co.uk/commentisfree/cifamerica/2011/mar/02/bernard-madoff-banking.
Wall Street Euro Scams
Lobbyists are quietly working to ensure the secret derivatives deals behind the euro crisis stay secret, reported Michael Hirsch in a Newsweek Web Exclusive article (February 16, 2010). Read on http://www.newsweek.com/.
What's next for the dollar?
Can the dollar rise while the Fed pauses and other market observers believe the Fed will toughen its stance and mop up the liquidity, even if housing is crushed in the process? By Axel Merk, in Asia Times Online (February 5, 2010). Merk is manager of the Merk Hard and Asian currency fund. On http://www.atimes.com/atimes/Global_Economy/.
The UK as Catalyst for Crisis
The flashpoints for a savage deepening of the crisis are multiplying. The UK is moving closer to the brink, and we now have to wait and see whether those reliant on the state, those bribed by the state, might stand back and make a hard choice, writes Cynicus Economicus on his blog (March 17, 2010). Read on http://cynicuseconomicus.blogspot.com/.
Needed: Britain's economic reinvention
Britain's economy is not only going down, but is not up to what it used to be. Economic reinvention should top the agenda. This is neither about betting again on the invisible hand of the market (with a little help from the City) nor counting on the heavy hand of the State. A shorter version of this article by Mike Guillaume was posted on Liberal Democrat Voice (see: http://www.libdemvoice.org/opinion-from-shipyards-to-wind-turbines-britain-needs-bets-17942.html). For an extended version, click here.
A plan for Britain's banking sector
A collapse has been averted, but there is still a lending crisis. Splitting up the banks should be on the agenda to remove large-scale systemic risks. A more varied banking ecology... Among the many points developed by Vince Cable at a Thomoson Reuters event (February 23, 2010). Full text on: http://www.libdemvoice.org/vince-the-lib-dems-plan-for-the-banking-sector-18055.html.
What EU regulation has cost the UK
Open Europe finds that regulation has cost the UK economy £176 billion since 1998 and, of this amount, £124 billion, or 71%, had its origin in EU legislation. The report finds that, on average, it is two-and-a-half times more cost-effective to regulate at the national than the EU level. Full report downloadable from http://www.openeurope.org.uk/.
The left must call the right's bluff – and challenge the EU
Why is it only Tory Eurosceptics that are highlighting Europe's lack of democracy? It's time to back people, not the City. It is a travesty that highlighting the EU's palpable lack of democracy has become a rightwing issue. By Owen Jones in the Guardian (December 13, 2011): http://www.guardian.co.uk/commentisfree/2011/dec/13/left-right-challenge-eu?INTCMP=SRCH
Credit where it's due: the hidden cost of quantitative easing
Quantitative easing was needed to prevent financial collapse but it has made the rich richer – and taxpayers will foot the bill for growing inequality. By Giles Wilkes in The Guardian (March 2, 2010), excerpted from a carefully thought paper written for UK's Centre Forum think tank. Downloadable from http://www.centreforum.org/publications/credit-where-its-due.html.
The Next Financial Crisis. It's coming-and we just made it worse
By Peter Boone (chairman of Effective Intervention, a Britain-based charity, and a research associate at the London School of Economics) and Simon Johnson (professor at MIT's Sloan School of Management) They write for The Baseline Scenario, a blog on economics. This very interesting paper can be read in The New Republic: http://www.tnr.com/article/economy/the-next-financial-crisis?
The banking crisis – A rational interpretation
This leads us directly into a discussion of 'cures'. What can be meant by 'cure' when the crisis is inevitable (even though unpredictable)? We mean measures that can either reduce the chances of a banking crisis or reduce the fall-out from it. By Patrick Minford, professor at Cardiff University and member of the CEPR. On http://www.eurointelligence.com.
Wealth & Health of Nations
A graph on http://www.gapminder.org/world/ shows how long people live and how much money they earn.
Eyes are starting to open and see the world as it is
One of the long running themes of this blog is that people have chosen an illusionary vision of the world rather than confronting reality. Read the full story on http://cynicuseconomicus.blogspot.com/
Economic growth no longer possible for rich countries
This new report tests a thesis in detail in the context of climate change and energy. It argues that indefinite global economic growth is unsustainable. Just as the laws of thermodynamics constrain the maximum efficiency of a heat engine, economic growth is constrained by the finite nature of our planet's natural resources. A paper published by the New Economics Foundation (http://www.neweconomics.org/publications).
Cameron’s Happiness Index is welcome news for progressives
Prosperity lost? In conventional wisdom, economic growth and higher incomes mean richer lives and improved quality of life. But, as the Happy Planet Index shows, true prosperity goes beyond material pleasures. It resides in the health and happiness of our families, in the strength of our relationships and our trust in the community. By Jules Peck, a founding partner of Abundancy Partners; a trustee of the think-tank the new economics foundation and a fellow of ResPublica. In Left Foot Forward: http://www.leftfootforward.org/2010/11/david-cameron-happiness-index/.
China May Succeed Where the West Failed –In Africa
Deborah Brautigan doesn't argue with critics who call China's interest in Africa self-serving. But she may be one of the first American academics to declare that China's deeds will be good for Africa, too. On http://www.globalenvision.org/ (March 1, 2010).
Africa: unprecedented Chinese investments
China is the largest investor in Africa while bilateral trade has just past US$100bn annually. Read more on http://scepticalmarketobserver.blogspot.com/.
Growth is good, isn't it? El desarollo medido en bienestar en vez de PIB
Expansion has progressed so far that key resource boundaries have been broken: we're teetering on the edge of an ecological cliff. By Andrew Simms, in The Guardian: http://www.guardian.co.uk/commentisfree/cif-green/2010/jan/25/uk-growth-energy-resources-boundaries. Or by Marcus Hurst in http://www.yorokobu.es/2010/01/27/el-desarrollo-medido-en-bienestar-en-vez-de-pib/
The price of environmental destruction? There is none
World's top firms cause $2.2 trillion of environmental damage, report warns. Putting a price on nature becomes meaningless if we treat the ecosystems upon which we depend as mere commodities with a price for trading. By Andrew Simms, in The Guardian (February 18, 2010): http://www.guardian.co.uk/environment/2010/feb/18/price-of-environmental-destruction.
In a Renewable Energy World, Is There an Alternative to Growth?
Human-caused climate change (if you accept it as a real phenomenon) presents a new problem: even if enough resources exist to continuing rapid growth, it's the growth itself that is introducing weaknesses. Controversial: http://industry.bnet.com/energy/10002854/in-a-renewable-energy-world-is-there-an-alternative-to-growth/
How to make buildings more energy efficient
Simple and effective measures to save energy and money, By Duncan Graham-Rowe for Guardian Professional Network on www.guardian.co.uk (December 16, 2010).
Sustainability will not be delivered without Equality
I would suggest that reclaiming and proclaiming equality as the core of progressive politics is the way forward. In other words we must concentrate, above all, on massively reducing the gap between rich and poor and persuading people that it has to be done, writes Bill Kerry on http://www.social-europe.eu/2010/04/.
Climate sceptics are recycled critics of controls on tobacco and acid rain
We must not be distracted from science's urgent message: we are fuelling dangerous changes in Earth's climate. By Jeffrey Sachs in The Guardian http://www.guardian.co.uk/environment/cif-green/2010/feb/19/climate-change-sceptics-science.
GDP Growth, Debt and Current Accounts
Is this economic growth coming back? Or something else? According to Cynicus Economicus watching both U.S. and U.K. “growth”, this is instead a steady process of national impoverishment. It is the feel good of consuming more than you produce, and the hell with the consequences in the future. It is a road to ruination. Read the full and much charted story on http://cynicuseconomicus.blogspot.com/
The “GDP Fraud”
If GDP is telling us that the US economy is steadily improving, how come so many folks on Main Street feel so bad? Don't they read the papers? Don't they know the GDP is improving? The short answer to these questions is that the GDP calculation is a fraud…or perhaps it's a fraud wrapped in a deception. Writes the Australian-born Joel Bowman, managing editor of The Daily Reckoning, in BusinessWeek. More on: http://bx.businessweek.com/causes-of-the-financial-crisis/view?url
Why We Need a New Macroeconomics
By Richard Alford, a former economist at the New York Fed. Economic and financial policymakers became prisoners of an ideology. I do not doubt that ideology has affected the evolution of economics and policy. However, I believe that (one) has underestimated the importance that macro economists attached to the elegance of their models and their failure to continuously verify the models’ accuracy and usefulness. On http://www.nakedcapitalism.com/.
Capitalizing on the Environment?
Can capitalism and environmentalism coexist not only peacefully but also profitably? Can the big corporations and the green movement work together? By Dr. Robert Muller (January 31, 2010) on http://thezeitgeistischanging.blogspot.com/
Innovators Creating Cash from Carbon Challenges
As it becomes more likely that companies in the U.S. will have to start paying for their carbon emissions, many of those companies will pass the cost onto their customers. There are three core areas where they could instead create stakeholder value by innovating their way to carbon reduction. By Thera N. Kalmijn and R. Paul Herman on http://sustainablelifemedia.com/content/column/strategy/innovators_create_cash_from_carbon_challenges.
Growth and Greenhouse Gases
On one side, there are those who insist that greening the economy is win-win: more jobs, more growth, as well as less carbon. On the other, those who insist that you can only be serious about protecting the planet if you admit that we have to give up on economic growth. By Paul Krugman on http://krugman.blogs.nytimes.com/ (April 13, 2010).
Reframing the Question: From Growth to Reallocation
Is the purpose of the economy to expand the power and privilege of a ruling elite? Or is it to secure and enhance the well-being of all the people who depend on it for their livelihood? Asked author David C. Korten on http://davidkorten.org/Reallocation. Read also his book: “The Post-Corporate World: Life after Capitalism”.
US financial crisis far from over
"The crisis is just beginning." "Have bankers won? In the short-term, absolutely. The immediate opportunity for change has already been missed." More plus links in the India Times. http://economictimes.indiatimes.com/news/international-business/US-financial-crisis-far-from-over-Economists/articleshow/5410915.cms
With caution, Americans still want a house
Nearly two-thirds of Americans would still prefer to own a home (April 6, 2010). On http://money.cnn.com/2010/04/06/real_estate/.
Global Markets Could Soon Crash
The global markets are at risk of crashing when the dollar rebounds, says economist Nouriel Roubini. Roubini, a professor at NYU, is credited with long predicting the financial collapse of 2007 and 2008. Read on MoneyNews.Com: http://moneynews.newsmax.com/streettalk/roubini_global_crash/2009/10/28/
Economic theory and the crisis
How will economic theory emerge from the global crisis? The column written by Alan Kirman (professor at Paul Cézanne University of Aix-en-Provence) says that representative agent models and the efficient markets hypothesis are assumptions that have persisted too long in the face of empirical evidence. It argues that economic theory is due for an overhaul but fears that economists will resist such change. Full column on http://www.voxeu.org/
Why Are Tariffs Preferable to Quotas?
By Mike Mofatt, on http://economics.about.com/cs/taxpolicy/a/tariffs_quotas.htm
A balancing act: fair solutions to a modern debt crisis
A… balanced paper written by Giles Wilkes for the Centre Forum. Full report downloadable from http://www.centreforum.org/publications/a-balancing-act.html
Small Change: Why Business Won't Save the World
Why doesn't business fix itself instead of meddling with others where it has no comparative advantage? By Michael Edwards on http://www.apesphere.com.
Too interconnected to fail = too big to fail. What's in a leverage ratio?
This Commentary by CEPS Director Daniel Gros argues that being 'too interconnected' is a factor, and that US accounting standards should recognise exposure of gross derivatives on the balance sheet to make this interconnectedness, and the resulting exposure, clear. Read and download on http://www.ceps.eu/book/.
How Reagan ruined conservatism
By Gideon Rachman in the Financial Times (http://www.ft.com, March 2, 2010).
He took advantage (Blues for Ronald Reagan)
Song written by Glenn L. Frey and Jack Tempchin, from the album “Strange Weather” (MCA, 1992). Lyrics available from: http://lyrics.filestube.com/song/04248d987d0a924d03e9,He-Took-Advantage-Blues-for-Ronald-Reagan.html.
The Future of Conservatism
What is conservatism? Various derogatory claims are often propagated. Firstly some claim that it is a mere pragmatism. Others say the Tories are the party of vested interest – they represent the status quo, they will always defend the rich against the poor, the strong against the weak and the haves against the have-nots. Others still say that conservatism is best expressed by a pure libertarianism, that extreme individualism, the glorification of self-interest… That again captures much, but not modern conservatism. Phillip Bond's speech to launch UK's ResPublica on http://www.respublica.org.uk/
David Cameron has lost his chance to redefine the Tories
I liked David Cameron; when he became Conservative party leader in 2005 he recognised that something was badly wrong with the right, and a new radical conservatism was desperately needed. I proposed a red Toryism – a commitment to the progressive merits of tradition and social conservatism and the need to build ethos-driven institutions, and a new Tory economics that distributed property, market access and educational excellence to all. In 2009 I argued for a new one-nation approach to Britain's problems, and Cameron appeared to agree. The principles of re-localising the economy, re-capitalising the poor and re-moralising the market were echoed in Cameron's speeches and policy ideas. By Phillip Blond, in The Guardian (October 4, 2012). http://www.respublica.org.uk/item/David-Cameron-has-lost-his-chance-to-redefine-the-Tories
The Future of Social Democracy
The Future of Social Democracy by Dr Jon Cruddas MP in association with Merthyr Tydfil and Rhymney Labour Party. A viable political alternative to market capitalism will require creative open thinking, new kinds of alliances and inventive forms of political organisation. Jon's lectures invite us to look once again at Labour's traditions and to collectively debate how we might renew and develop them. Full text downloadable from http://www.compassonline.org.uk/index.asp.
Mutualism: social democratic policy in an age of austerity
The challenge for Labour is to develop a clear vision of what mutualism means for the Left and how it can be used to drive forward the social democratic project. In this series, prominent thinkers, politicians and strategists will reflect on mutualism's relationship to social democratic values and objectives and aim to generate concrete policy solutions to give Labour the tools to constructively challenge the "big society". More on Policy Network: http://www.policy-network.net/content.aspx?CategoryID=375&ArticleID=3454&fp=1.
Quatre voies de sortie pour une science en crise
Les économistes bousculés par la crise. Le débat est ouvert sur la meilleure façon de redonner de la crédibilité aux economists… les partisans d’un changement radical s’organisent. Dans Alternatives Economiques (Janvier 2010) sur www.alternatives-économiques.fr.
Copenhagen, Carbon, Consumer Goods Supply Chains
A guest post about the UN Climate Summit in Copenhagen from Peter Lacy of Accenture. The good news—at least on logistics—is that around 60% of potential carbon abatement opportunity is within the transport and logistics industry's direct control, and a few other interesting facts and figures. On BusinessWeek: http://www.businessweek.com/careers/managementiq/archives/2009/12/copenhagen_carb.html
Manufacturing Framework and Intellectual Capital
Athena Alliance is releasing a Policy Brief--Intellectual Capital and Revitalizing Manufacturing--which expands the Framework to explicitly incorporate intellectual capital. The paper's recommendations are summed up by Ken Jarboe on http://www.athenaalliance.org/weblog/archives/2010/02/manufacturing_framework_and_ic.html
There is no integration without work
The increase in migration collides with an economic crisis that affects especially the poorest classes, making cohabitation of natives and immigrants even more difficult. But it is important to remember that the economic integration of immigrants is essential for a complete social integration and for the peace of all society. By Emanuela Scridel on http://www.resetdoc.org/EN/Migrations-europe-work.php.
If you want to know who's to blame for Copenhagen, look to the US Senate
As a result the political cost of the failure at Copenhagen is zero. Where are you. By George Monbiot, in The Guardian (December 21, 2009). Read on: http://www.guardian.co.uk/commentisfree/2009/dec/21/copenhagen-failure-us-senate-vested-interests
Ben Bernanke as public intellectual? Are you serious?
Time Magazine's Person of the Year, Ben Bernanke, is heralded as the savior of the US economy. But the Fed chairman is actually the real villain of the piece. By Dean Baker, in Prospect Magazine (December 16, 2009): http://www.prospectmagazine.co.uk/2009/12/ben-bernanke-as-public-intellectual-are-you-serious/
How to escape currency volatility and contagion in the globalized world of finance
By Edward Harrison of Credit Writedowns. The question I ask is this: now that finance is global and capital can move in and out of markets and countries on a dime, how can any country protect itself against the volatility of currency markets? Read the full viewpoint on http://www.nakedcapitalism.com/
Dubai World: A great precedent
Comment by Felix Salmon on http://blogs.reuters.com/felix-salmon/2009/11/26/ who refers to the chart of the debt structure published on the same day on http://ftalphaville.ft.com/blog/2009/11/26/85571/csi-dubai/ (see also reference below). It goes as:
The dark side of Dubai
Dubai was meant to be a Middle-Eastern Shangri-La, a glittering monument to Arab enterprise and western capitalism. But as hard times arrive in the city state that rose from the desert sands, an uglier story is emerging. Johann Hari reported about that in The Independent six months before the burst of the Dubai mirage. His analysis still makes a compelling read. On: http://www.independent.co.uk/opinion/commentators/johann-hari/the-dark-side-of-dubai-1664368.html.
I'm a celebrity, get me out of Dubai!
Posted by Izabella Kaminska on ft.com/alphaville blog (http://ftalphaville.ft.com November 26, 2009), who reminds us that investors as smart (sorry, just famous) as Beckham, Michael Jackson, Naomi Campbell and Brad Pitt followed the crowd of investors as famous (sorry, not even smart) as HSBC, RBS, Lloyds, Citi, and more to be disclosed (?).
Read the comment made by Benz Sudta, from Thailand, who really makes a good point:
Dubai tried to copy the Singapore's model of development. They tried to be the hub of the region in service sector particularly finance and logistics. But they lacked 3 vital element of development.
1. The most important is the lack of well-established education. In stead of investing heavily in human capital, they chose to flood money into foreign financial asset and domestic infrastructure and real estate. Moreover, they must depend own external pool of talent people. They must import expats.
2. They lack their own source of capital. Unlike GIC and Temasek, those super and complicated Sovereign Wealth Funds were built mostly from external financing. Therefore, creating debt burden to this city.
3. Dubai ruler lacks sharp and long vision in assessing global trend and shaping long-term policy. Dubai ruler is not absolutely equal to Lee Kuan Yew in term of vision.
The Risk Management of Islamic Finance
No joke. The course was held in Abu Dhabi (December 6-8, 2009) in the aftermath of the Dubai rescue plan. Want to avoid being a sinner? More on http://www.islamicfinancetraining.com/.
Bankers Blow $20 Billion Faster Than Gamblers
Two years ago, sovereign wealth funds were heralded as saviors of world markets. That was when Lehman Brothers seemed too big to fail. It was a quainter time, when Iceland was a country, not a failed hedge fund, and American- style capitalism still had some appeal. The thinking then was that the trillions of dollars that governments were pouring into markets… By William Pesek in BusinessWeek: http://www.businessweek.com/news/2010-03-03/bankers-blow-20-billion-faster-than-gamblers-william-pesek.html
The bosses who break their banks – The men who earned too much
In an extract from a new book, John Cassidy reveals why huge salaries commanded by Wall Street bosses created a culture that help trigger the financial crash. Extract in The Guardian (November 25, 2009) and book published by Allen Lane (How Markets Fall: The Logic of Economic Calamities).
Reaching into Bank Executives' (Deep) Pocketbooks Motivates Action
Daniel Gross says the threat of restrictions on how much executives can be paid has motivated banks subject to the limits to "get their houses in order". Read more on: http://economistsview.typepad.com/economistsview/2009/12/reaching-into-bank-executives-deep-pocketbooks-motivates-action.html
2009 Nobel Economics Prize: What does it mean?
The common theme of Ostrom and Williamson's work is economic governance – basically, how economic agents cooperate and coordinate their actions without the presence of the market and market prices. By Ari A. Perdana, in The Jakarta Post (October 19, 2009). On: http://www.thejakartapost.com/news/2009/10/19/2009-nobel-economics-prize-what-does-it-mean.html
How to tame global finance
A group of leading financial analysts quiz Britain's top regulator on what went wrong, while experts including Robert Kuttner and Oliver Kamm offer their responses. The Prospect interview panel: John Gieve is chairman of financial transaction specialists VocaLink and formerly deputy governor of the Bank of England Jonathan Ford is commentary editor of Reuters and an associate editor of Prospect Gillian Tett is an assistant editor of the Financial Times, specialising in global financial markets Paul Woolley is a senior fellow at LSE, where he founded a centre for the study of capital markets Read the debate on Prospect: www.prospectmagazine.co.uk/2009/08/how-to-tame-global-finance/
Goldman Sachs, the lords of time
Just for the moment, let's pretend that James Cameron's 1984 The Terminator was being made for the first time today, and, instead of the evil robots emerging from the fatally misguided foundries of Cyberdyne Systems, they came from the dark laboratories of Goldman Sachs. By Julian Delasantellis, consultant, private investor and educator in the state of Washington, on Asia Times Online (August 5, 2009): http://www.atimes.com/atimes/Global_Economy/.
Implementation of Alternate Energy - The Role of the Government
.. all homes that are under construction or being remodeled must use alternative energy sources. Ultimately a time would come when all homes as well as corporate buildings would use alternate energies for 100% of their energy needs. The other important mandate that is expected from the government is that all new vehicles built in must be hybrid and be powered by hydrogen fuel cells by the year 2020. By Ron Harene on http://thezeitgeistischanging.blogspot.com/2009/11/alternative-energy-implementation-of.html
Climate change: the challenge for social democracy
Politically, the climate change agenda has so far been presented as a major opportunity for progressive policymakers… (But) the principles of localism and mutualism of the “green” movement do not always sit easily alongside those of positive freedom and collective prosperity in social democracy. On Policy Network: http://www.policy-network.net/content/356/Climate-Change-The-Challenge-for-Social-Democracy.
Nouriel Roubini calls for radical reforms to fix the broken financial system
The crucial challenge is to design a better system of regulation. There is no doubt that the previous model has failed miserably (Financial Times – The Future of Finance. November 2, 2009).
Take the lead on regulation to call the bankers' bluff
Tony Jackson, in The Financial Times (November 2, 2009)
Time to say hard cheese to Swiss banks
A comment by David Prosser read in The Independent (August 20, 2009). Related article: UBS to disclose details of 4,450 accounts in US tax evasion case, by James Thompson
Painful death of the American economic dream
This crisis has been a long time in coming, and history suggests that the period of upheaval will be long and painful, just as it was between 1914 and 1945. By Larry Elliott, in The Guardian (November 2, 2009).
Fiat faces heavy burden with U.S. waistline
As an American with a longish tenure in Europe, I never fail to be impressed on trips home by the ever-expanding frontier of the American waistline. It was, therefore, that I read of Francesco Guerrera's sincere hope that the restyled and relaunched Fiat “Cinquecento” finds as warm an embrace in the US today as it did in Italy in the 1960s. However, as the US ranks first in obesity among 28 OECD countries and Italy 25th, one wonders whether this hope can ever be fulfilled. But it may. After all, they are not being asked to ride Vespas.
A letter from Paul Hennemeyer to the Financial Times (November 14, 2009). Edited.
A Quick Comparison of Capitalism, Socialism and the “Just Third Way”
By the Center for Economic and Social Justice (Washington, D.C.). The table can be read on: http://www.cesj.org/thirdway/comparison3rdway.htm
New AIG chief to receive $7m pay
By Francesco Guerrera in the Financial Times (August 17, 2009).
Rating agencies under scrutiny by lawmakers
Credit rating agencies came under renewed fire as lawmakers examined their role in the financial crisis and discussed new legislation that could make the agencies liable for each other's mistakes. Read the full article in the Financial Times (October 1, 2009).
Going Solar – Frequently Asked Questions
As with any sizable financial investment, it's best to go into the world of solar energy with your eyes wide open and with as many facts under your belt as possible so you can make an informed decision. FAQs on http://thezeitgeistischanging.blogspot.com/ (April 6, 2010).
Green Living: Greensizing for Productivity
We all want to do our part to help the environment. But if you can give the Earth a break and increase your productivity at the same time, that's a real no-brainer!... Give your PC a rest… Drive smart… Travel less… When you get down to it, greensizing is just a matter of paying a little more attention to the habits that you wouldn't usually give a second thought. By Laura Stack on http://thezeitgeistischanging.blogspot.com/2009/10/green-living-greensizing-for.html
Green Consumer Awareness vs Reality
A viewpoint by Louise König, based on a study of New Scientist magazine. On http://www.sustainable-perspectives.com/.
12 Tips for Ethical Marketing to the New Consumer
Chris Arnold's new book Ethical Marketing and the New Consumer discusses how marketing must change to reach today's consumers. If you are interested in any aspect of ethical marketing – Arnold covers product development and design, messaging, positioning and more – this is a recommended read. Summary on http://www.triplepundit.com/2010/01/12-tips-for-ethical-marketing-to-the-new-consumer-book-review/
Iceland's Recovery: Can the Lessons Be Applied Elsewhere?
As the first country to experience the full force of the global economic crisis, Iceland is now held up as an example by some of how to overcome deep economic dislocation without undoing the social fabric. A survey by the IMF (October 24, 2011): http://www.imf.org/external/pubs/ft/survey/so/2011/SurveyartF.htm.
Island genießt die Krise (How Iceland Is Coping With a Broken Economy)
Ein Land am Abgrund: Vor einem Jahr brachen auf Island erst die Banken und dann die Staatsfinanzen zusammen. Bis heute hat sich die Wirtschaft davon nicht erholt. Doch das Inselvölkchen arrangierte sich mit dem Crash. Es lebt wieder bescheidener - und ist überraschend zufrieden. Von Niels Reise in Der Spiegel (08.10.2009). On http://www.spiegel.de/wirtschaft/soziales/.
Iceland Wants in, but Unity Diminishing in the EU
Iceland, prior to the government's collapse, had a very high standard of living. Iceland needs to question if the decision to join the European Union is the right one. Although they may receive additional bailout funds from the union, it is questionable if there are even enough funds to bailout current members. More on: http://www.globalization101.org/news1/Iceland_Financial_Crisis.
Chinese Company Buys Hummer from GM
Seen on: http://www.businessweek.com/globalbiz/blog/eyeonasia/. Mikeconomics liked very much the comment of a reader named Steve: I'm not sure I would call Hummer an "iconic" brand. Corvette is iconic. Hummer is damaged goods. I would like to think that the Chinese just purchased a toxic asset and freed G.M. to produce cars people actually want to drive, not fantasize about.
The DownFall of General Motors and the 2009 Hummer
Today on the highways or in town you still can pull up to a stop light and look out your window to see a rubber tire and a fender. Above your head if you look up high enough you may see a massive vehicle that has monstrous wheels driven by only one person. The vehicle is an SUV. On Green Earth Way: http://greenearthway.blogspot.com/2009/07/downfall-of-general-motors-and-2009.html
The era of global oil giants is over
“A new model is emerging in which smaller national and larger international oil companies must work in new partnerships,” states Nick Butler, former group vice-president for strategy at... BP, in the Financial Times (July 28, 2010)
Just 90 companies caused two-thirds of man-made global warming emissions
Chevron, Exxon and BP among companies most responsible for climate change since dawn of industrial age, figures show (The Guardian, November 20, 2013) http://www.theguardian.com/environment/2013/nov/20/90-companies-man-made-global-warming-emissions-climate-change
After subverting bank insolvency, our leaders are now about to make a mess of liquidity
Unless there is a major change of direction among global economic and financial officialdom, we are at risk of ending up with a world in which liquidity provision is privatised and insolvency risk for banks is socialized. Writes Willem Buiter in the Financial Times (October 6, 2009). Read the full article at: http://blogs.ft.com/maverecon/2009/10/
A financial revolution with profound political implications
The Independent's commentator Robert Fisk on the plan to de-dollarise the oil market, discussed both in public and in secret for at least two years and widely denied yesterday by the usual suspects – Saudi Arabia being, as expected, the first among them – reflects a growing resentment in the Middle East, Europe and in China at America's decades-long political as well as economic world dominance. On http://www.independent.co.uk/opinion/commentators/fisk/robert-fisk-a-financial-revolution-with-profound-political-implications.
Failures of Small Banks Grow
A year after Washington rescued the banks considered too big to fail, the ones deemed too small to save are approaching a grim milestone: the 100th bank failure of 2009… In all, bank failures have cost the FDIC $26.6 billion in 2009. Read the article by Eric Dash and check out the graph in the New York Times (October 10, 2009). On http://www.nytimes.com/2009/10/11/business/economy/.
The Transmission of the Financial Crisis to Emerging Markets
In 2008 there was a lot of talk about emerging market economies being able to decouple from the US recession and financial crisis. But, in spite of these arguments, first financial re-coupling and then real economic re-coupling took place once the advanced economies' financial tsunami became global after the summer and fall of 2008. A paper by Nouriel Roubini, on October 9, 2009, available from http://www.rgemonitor.com/blog/roubini
Jobs, industry and opportunity: Growth strategies after the crisis
This is the challenge that the progressive centre-left has to take on. Not through backward looking debates or ideological introspection, but by mobilising the political and intellectual capital of the entire progressive community within and beyond our countries. This selection of short articles, written by leading experts in the field, attempts to guide, inspire and, in particular, challenge some of the key issues at stake. More on http://www.policy-network.net/publications/publications.aspx?id=3606.
How Did Economists Get It So Wrong?
Few economists saw our current crisis coming, but this predictive failure was the least of the field’s problems. More important was the profession’s blindness to the very possibility of catastrophic failures in a market economy. During the golden years, financial economists came to believe that markets were inherently stable — indeed, that stocks and other assets were always priced just right. There was nothing in the prevailing models suggesting the possibility of the kind of collapse that happened last year. Meanwhile, macroeconomists were divided in their views. But the main division was between those who insisted that free-market economies never go astray and those who believed that economies may stray now and then but that any major deviations from the path of prosperity could and would be corrected by the all-powerful Fed. Neither side was prepared to cope with an economy that went off the rails... By Paul Krugman in The New York Times (September 2, 2009).
Too Big. Too Far. Too Short. Too Selfish. Too Greedy. Too Wild. Too Much.
And other (not so) venial sins in: