Comment, analysis and other offerings from Friday’s FT,
Gillian Tett: Lessons in a $3,300bn surprise from the Fed
When the US Congress passed the monstrously large Dodd-Frank financial reform bill last summer, it was clear that surprises were lurking in those 2,300 pages. This week one has cropped up. On Wednesday, the US Federal Reserve released the details of the liquidity measures and loans it extended during the financial crisis, totalling an eye-popping $3,300bn, notes the FT’s Tett.
Philip Stephens: Europe’s leaders recoil from unity
The crisis of the euro is a crisis of Europe. The continent is slipping into a new nationalism, writes the FT’s Stephens. This is not a rerun of the expansive chauvinism of old – the marching of armies across frontiers that left such grievous scars in the first half of the 20th century. What we are seeing now is the pinched nationalism of a Europe that has lost confidence in its future.
Lex on the EFSF
It’s alive! The European Financial Stability Facility, Siamese twin to the bail-out of Greece, is about to flicker into life, notes Lex. Officials plan to raise up to €8bn in the bond markets to finance the EFSF’s role in the bail-out of Ireland. Investors need to kick the tyres thoroughly when it comes calling.
Sebastian Mallaby: Wall Street owes its survival to the Fed
For a brief, surreal moment, the prevailing narrative in Washington was that the 2008-09 bail-outs were not really so bad, says Mallaby, senior fellow at the Council on Foreign Relations and author of ‘More Money Than God: Hedge Funds and the Making of a New Elite.’ But Wednesday’s document dump from the Federal Reserve puts this bargain-bail-out patter in a new perspective.
Samuel Brittan: Budgetary lessons for our age of austerity
The UK’s newly established Office for Budget Responsibility has done a Herculean job in its report on the Economic and Fiscal Outlook, writes the FT columnist. It has thoroughly analysed every aspect of the economic and fiscal scene using state of the art methodology. Its three-man “Budget Responsibility Committee” has taken over the Treasury’s forecasting role. It moreover has access to every nook and cranny of Whitehall and has had extensive discussions with outside experts.
Analysis: Europe’s hidden billions – cohesion for a reason
It is a programme that every year pays for road and rail links long enough to reach from Berlin to Beijing, reports the FT’s Stanley Pignal. The transport projects are just one part of a core EU programme aimed at lifting the bloc’s poorest regions into modernity. For the creators of the European project decades ago, and for its caretakers today, there is no more central mission for the EU, a fact alluded to in the very name of the €347bn ($459bn) seven-year programme: the “cohesion funds”.
Paul Mackel: Krone for good times and bad
The Norwegian krone has largely been shunned by the markets this year – but its excellent fundamentals mean there is clearly room for it to strengthen, says Paul Mackel, senior FX strategist at HSBC.
Money Supply: Fed headed for press conferences?
There is a definite trend in communications by Fed chairman Ben Bernanke: more and more people are being allowed to ask him questions, writes the FT’s Robin Harding. This is all for the good because the Fed has a communication problem: the breadth of the FOMC, with its 19 members, creates noise that drowns out the real message.