A pretty interesting paper, and conclusion, from the Bank of England’s External MPC unit on Friday — or at least one that should keep the debate going over the art/science of GDP revisions… Read more
European monetary union: so troubled, so awkward and ill-conceived, et cetera.
And so… speedy?
We spent a bit of time last year pondering precedents and possible scenarios for monetary union break-ups, of which there are few with much appeal. But Deutsche Bank strategist Stuart Parkinson makes the interesting argument that it took about 147 years for the US to become a monetary union. Read more
OK – Lisa’s the modelling maven and she’s promised a longer post on this paper tomorrow…
“‘The Formula That Killed Wall Street’? The Gaussian Copula and the Material Cultures of Modelling” is a recommended read (H/T Tracy Alloway). It’s not really about anything killing Wall Street — more a combination of economic sociology and an oral history stretching back to January 2007. The authors even got in touch with David X. Li. Read more
Huge hat-tip to Paul Kedrosky for this – an eye-catching chart from JPMorgan’s Michael Cembalest’s ‘Eye on the markets’ note (click to enlarge):
- Parachuted in by the great powers of the time Read more
(Alternative title: Financial repression meets the History Channel?)
Telling the UK government to issue 100-year bonds clearly wasn’t out-of-the-box enough for Societe Generale’s rates strategist Julian Wiseman. Read more
We don’t know. We really really don’t know.
Bernard-Henri Lévy writing for the Huffington Post: Read more
Just to put the boot in on the historical analogies…
The Amulree Commission on a peripheral debt crisis, 1933:
No part of the British Empire has ever yet defaulted on its loan obligations; in the absence of any precedent, the consequences which would follow from a default by Newfoundland must remain to some extent a matter for speculation. But if no precedent can be drawn from the history of the Empire, instruction may be derived from the experiences of other countries, and it is clear from these that any play of default such as that outlined above could be approved with the greatest apprehension… Read more
Earlier, we considered whether the Republic of Greece is turning into a giant collateralised debt obligation.
This is because proposals to have the EFSF back a Greek government bond buyback appear to introduce some element of collateralisation to Greece’s debt. Although it’s all very complex – and we could be wrong. Read more
It’s amazing how little a few trillion dollars gets you these days.
We like a wee bit of historical perspective here on FT Alphaville, and this week’s edition compares the costs of the recent financial crisis with those of its antecedents. Read more
Some consolatory reading for the Greek… Irish… and Portuguese finance ministers on Friday. Citigroup chief economist Willem Buiter has taken a long hard look at other developed sovereigns — and has used the opportunity to remind that no sovereign is safe.
It’s billed as a response to a recent IMF paper arguing that default (in the eurozone in particular) would be ‘unnecessary, undesirable and unlikely’. Read more
Hindenburg Omens are for kids. Here’s a tip of the top hat to Barry Ritholtz for unearthing this nineteenth-century great-grand-daddy among technical cycles:
From the archives of Time magazine, a worthwhile read on how US bankers reacted to the “monstrous system of guaranteeing bank desposits” – aka, financial regulation, 1933 style:
Through the great banking houses of Manhattan last week ran wild-eyed alarm. Big bankers stared at one another in anger and astonishment. A bill just passed by both houses of Congress would rivet upon their institutions what they considered a monstrous system of guaranteeing bank deposits. Such a system, they felt, would not only rob them of their pride of profession but would reduce all U. S. banking to its lowest level. They saw their deposits which they had spent a lifetime to build up and protect with their good names confiscated by the Government to pay for the mistakes and dishonesty of every smalltown bankster. Read more
Are you a Chinese politician looking for ideas to pare back your country’s lending boom?
Well, look no further! According to a new NBER paper, your own history — circa the late Qing dynasty — has some excellent policy insights. From the abstract, emphasis ours: Read more
1Time to take basic income seriously?
2We cannae give the economy no more, we're giv'n it all we've got Captain
3The case for official e-money +1
4Hacking and property prices make the BoE big league
5"Companies should know who really owns them..."
Show more6Tax needn't be taxing. It can also be a Hungarian debt wheeze
7QE down under
8The end of the end of the end of the commodities supercycle is nigh, in Asia
9When liquidity meets control in China [updated with credit crunch probability]
10The central bank (communications) bubble
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