Mack

Much of the debate on ending Ireland’s fiscal crisis has centred on the combination of tax rises and spending cuts required. The left have been particularly vociferous in calling for an increased tax burden on the rich, while at the same time wondering “where’s my stimulus package?”. Many years ago, TJ Rodgers, a tech entrepreneur and investor, put forward strong arguments for allowing the wealth creators to create wealth, rather than governments. Keynes argues that severe downturns create irrational pessimism …

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RTE reports that Standard & Poor’s Ratings Services downgraded it’s long term sovereign credit rating for Ireland from ‘AAA’ to ‘AA+’. The downgrade had been well telegraphed and the percieved risk in Irish government debt long priced into the spread paid by the government on Irish treasuries over German government bonds. S&P warn that Ireland may be downgraded again if public finances deteriote further. Bloomberg report that the cost of insuring Irish government debt rose 31 basis points, while the …

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The Sunday Times ran a piece, entitled Bad Luck of The Irish, covering the impact of the current recession. It poses the question “Could Ireland be the first euro country to go bust?”, without running a comparison. They almost certainly mean Eurozone, but it’s not made explicit. Greece would be our nearest competitors in that regard, but as the FT recently pointed out – Ireland is taking it’s position seriously and making the hard decisions, Greece is not. However, the …

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The International Herald and Tribune reports a surge in shanty towns in US cities, reminiscent on a smaller scale of 1930’s era ‘Hooverville’ Shanty Towns. The newly foreclosed and jobless are making a simple tent home on vacated land in major American towns. Meanwhile, Barry Ritholtz covers The Future of Finance Initiative in Washington D.C. attended by Nicholas Nassim Taleb. Taleb is an expert on risk, and as an option trader made millions during the current market collapse. An ardent …

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Ambrose Evans-Pritchard reports that two key ECB governors have informed him that the ECB are at last willing to follow the British, Americans and Swiss and engage in real Quanititive Easing. QE is likened to printing money as it involves effectively creating new money and using that new money to purchase assets. By increasing the supply of money chasing the same goods and services, officials hope to stave off nominal price falls and prevent a deflationary spiral from taking hold. …

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The Telegraph reports that the US is open to giving support to Chinese proposals for a new World currency not under the control of a single sovereign nation. They have more here, too. Yesterday Zhou Xiaochuan of the Chinese Central bank published proposals for an new international reserve currency, that is able to remain stable over the long run (maintain value). This comes hot on the heels of similar proposals for “paper gold” from the Russians. Recently the US Federal …

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