Mack Take a break from the doom and gloom of the credit crunch with Matt Ridley’s talk on his excellent upbeat book “The Rational Optimist – How Prosperity Evolves”, time to take a step back and appreciate just how lucky those of us alive today really are. Per the blurb for the talk – Matt Ridley, bestselling author of The Red Queen, Nature via Nurture, and other books, tells the story of human cultural and economic evolution in his latest work, …
RTE report that in the last hour Enda Kenny has sacked Deputy Leader and Finance Spokesman Richard Bruton. This comes after Bruton had told Kenny he no longer had his support, and certainly brings the matter of a Fine Gael leadership challenge to a head. Per the report The move means Mr Bruton will not be in a position to table a motion of no confidence in his party leader at tomorrow’s front bench meeting. It may indicate that Enda …
European Central Bank executive member Lorenzo Bini Smaghi outlined the fiscal and monetary constraints facing EU states at the Group of 30 conference in Rabat. In it he warns of a US of future crisis, and perhaps controversially denounces Keynesianism as inappropriate. European states can’t rely on inflation to reduce their debts, fiscal austerity is the only course available to them, but Americans may be deluding themselves that they will be able to impose an ‘inflation tax’ on investors in …
An interesting discussion on the problem of, and solutions to, sovereign debt default on Newsnight. Everyone’s favourite, um, “clinker-bag” is back, this time being rude to Columbia University’s Professor Jeffrey Sachs, Gillian Tett a journalist at the Financial Times also in attendance. Kent Brockman, from the Simpsons said it best in Homer the Vigilante. Kent Brockman reports on the situation. Kent: Hordes of panicky people seem to be evacuating the town for some unknown reason. Professor, without knowing precisely what …
A few months back Morgan Stanley analyst Joachim Fels produced a set of warning signs that would indicate the Eurozone was at increased risk of breakup. He’s back today with a new research note – To be clear, we neither advocate a EUR break-up nor is this our main scenario. However, the risk that it happens is far from negligible and the consequences for financial markets would be severe. Given recent developments, a break-up scenario has clearly become more likely, …
Entertaining, and sobering futuring at Naked Capitalism. President Kucinich also announced a new “Marshall Plan” for war-ravaged Europe, which has descended into near anarchy since the EU collapsed in late 2010. He called on the Italian Red Brigade army to end its siege of Berlin. He promised to begin an airlift of food for Europe’s starving millions, to be followed by industrial products to help European nations to begin to produce for domestic consumption. He called for an end to …
Interesting debate in the US blogosphere on the pro-market reforms implemented in the US (and other countries including Britain & Ireland) since 1980. Paul Krugman defends the large rise in American living standards pre 1980 liberalisation and contrasts it with more moribund growth there after while Scott Summer highlights the reversal of the American economies (and that of other reformers) relative decline. Krugman – Read almost any conservative commentator on economic history, and you’ll find that the era of postwar …
October 2009 New Greek government elected. 5th November 2009 New Greek government ‘fess up. The budget deficit is 12.7% not 6%, as claimed by their predecessors! 20th November 2009 The European Central Bank tightened the rules for the collateral it accepts against loans, the new rules will come into force on March 1st 2010 December 2009 ECB says plans will not be delayed to help Greeks And Ratings agencies downgrade Greek debt And Greek Government begins undertaking first round of …
On Newstalk Radio this morning Professor John Fitzgerald of the ESRI explains why he thinks Morgan Kelly’s analysis of the banking crisis is overly pessimistic and replies to David McWilliams assertion that his growth estimates are ‘horseshit’. John Fitzgerald on Newstalk Radio – his interview starts about 40-41 minutes in. The reasons why he feels Kelly is overly bearish – 1. Fitzgerald argues that there are insolvency issues at Anglo Irish Bank and Irish Nationwide, but that AIB and Bank …
Hat tip to The Big Picture for this entertaining, Australian, look at the Euro crisis. From the transcript – BRYAN DAWE: How much does Greece owe, Roger? JOHN CLARKE: $367 billion. BRYAN DAWE: Correct. And who do they owe it to? JOHN CLARKE: Mostly to the other European economies. BRYAN DAWE: Correct. How much does Ireland owe? JOHN CLARKE: $865 billion. BRYAN DAWE: Correct. Who do they owe it to? JOHN CLARKE: Other European economies mostly. BRYAN DAWE: Correct. How …
Morgan Kelly, in excellent form, produced a tour-de-force in the Irish Times, covering the banking crisis that is sinking us. He reprises the figures from his earlier article on Vox (covered on Slugger here) – Ireland is on course for a debt-to-GNP ratio of 140%. The issue of national sovereignty has for so long been the monopoly of republican headbangers that it is hard to know whether ordinary, sane Irish people still care about it. Either way, we will not …
Jeff Randall in the Telegraph proclaims the Euro as we know it to be dead, despite the valiant rearguard action currently being fought by Angela Merkel In one respect, Mrs Merkel is right: “The euro is in danger… if the euro fails, then Europe fails.” What she has not yet admitted publicly is that the main cause of the single currency’s peril appears beyond her control and therefore her impetuous response to its crisis of confidence is doomed to fail. …
Michael Taft has an interesting post on the cost of unemployment. Ireland is idealogically hamstrung in dealing with this problem, constrained as we are in terms of borrowing to invest by the banking crisis, the fiscal crisis and our Euro membership. Although there may be an alternative available to us – straddling the line between capitalism and socialism (but not insipid third-wayism). The state could raise cash by selling off state assets. Funds raised should only then be used for …
Simon Johnson and Peter Boone turn their attentions to Ireland – their analysis is truly shocking and is informed by a valid (and obvious) adjustment. They use GNP in preference, as a superior indicator of Ireland’s ability to repay debt, to GDP. I’m surprised this hasn’t been used more commonly when discussing the deficit. When we adjust Ireland’s figures accordingly, the situation is dire. The budget deficit was about 17.9 percent of G.N.P. in 2009, and based on European Commission …
Nouriel Roubini interview on RTE Radio. Some highlights, he is more optimistic about Ireland because 1. The fiscal adjustment has been done in more credible way, sooner than in Greece, Spain & Portugal 2. Ireland is more flexible, dynamic, entreprenuerial and has suffered less of a loss of competitiveness than the other PIIGS 3. There is light at the end of the tunnel for Ireland He thinks it’s not going to be easy, but relative to other members of the …
In the midst of a European sovereign debt crisis analysts stateside are worried about their future. Produced by the National Inflation Association the video splices contributions from Marc Faber, Jim Rogers, Ron Paul, Peter Schiff and others to make the case that the United States is staring into the face of a future currency crisis and hyperinflation. Hat tip to Gerard O’Neill for this particular horror movie He also linked to an interesting presentation with Niall Ferguson US Flag http://www.flickr.com/photos/jiazi/ …
Paul Krugman isn’t pulling any punches on what restoring competitiveness within the Euro will mean for the peripheral countries. Neither does David McWilliams’ on Ireland’s future inside or out of a currency union with Germany.
Not only by the Mayans – Morgan Kelly is back. This time he estimates that banking losses could turn out to be much more severe than predicted during the Nama debates, which will bring our very own Greek tragedy to our shores. Whatever happened to Ireland? Adding these bank losses to its national debt will leave Ireland in 2012 with a debt-GDP ratio of 115%. But if we look at the ratio in terms of GNP, which gives a more …
Twice in the past century Germans have learnt, the hard way, the value of sound money. Between 1921 and 1923 the Weimar Republic, under the strain of massive WW1 reparations, fell into a hyper-inflationary death spiral. The Mark plunged in value, measured against Gold Standard Marks it fell from a ratio of 1:1 to 1:1 trillion in 2 years. After the German defeat in WW2, their economy was in tatters and the Reichsmark once again worthless. In 1948 Ludwig Erhard, …
Bloomberg report that – The U.S. economy expanded at a 3.2 percent annual rate in the first quarter as households spent more freely, setting the stage for gains in employment that may help the recovery broaden and accelerate. and the Wall Street Journal note that Greece has agreed with the International Monetary Fund and the European Union to take additional austerity measures expected to yield “around €23 billion” ($30 billion) as a precondition for financial assistance, a Greek official familiar …
