The Keynesians’ New Clothes

Since early 2010 I have been arguing in my reports against the core neo-Keynesian precepts of the economic and monetary policy mainstream. In general I have not been optimistic that, notwithstanding their abject failure to foresee the global financial crisis, and their ongoing, failed responses thereto, the mainstream would reconsider its views. But some interesting [...]


Why Estonia Is Beating The Eurozone

This article came in this morning from the Mises Institute about Estonia, a country we’ve been casually following because of its free market friendly policies. Frank Shostak is an economist I follow closely.

Why Estonia Is Beating the Eurozone

By Frank Shostak on October 18, 2012

Against the background of a severe economic crisis in [...]


Draghi Acts: Is It Inflationary?

The European Central Bank (ECB) has decided to bailout its bankrupt members, mainly Italy and Spain, by buying their shorter-term bonds ( 1 to 3 years) with newly created money. The idea is to drive down their interest rates to alleviate their debt cost burden, and to send a message to the world (the financial markets) [...]


KeithGram: Euroland, Silver, and Gold

Last Thursday, in my subscribers’ newsletter I touched on a theme of the silver-euro correlation.  Clearly, the euro is heading to zero (not necessarily immediately and not necessarily all at once) and clearly silver is not.  This means that the correlation will end, and silver will decouple from the euro to the upside, perhaps violently.



Eurozone Banks Exiting U.S.

[This research note is from Deutsche Bank's DB Reasearch group.]

Since the outbreak of the financial crisis in 2007, Europe’s banks have been gradually retreating from the US market, thereby making room for others to step in. At their peak in September 2007, euro-area banks held assets equivalent to 50% of all foreign bank assets. [...]


Spain Needs a Bail-In, Not A Bail-Out

Spain’s banking reform: a bailout of the status quo

If a couple of months ago we warned about the eerie similarities between Mexico’s 1994 financial fiasco and what is now taking place in Spain, the latest details on the Spanish financial sector bailout continue to remind us not to underestimate politicians’ readiness to undermine whatever is [...]


Portugal: Capitulation Of Hope

[Portugal has been the "sick man" Europe for many, many years. After the overthrow of the corrupt military dictatorship in 1974, the country has suffered through a succession of mostly socialist leaders, with strong elements of Marxist parties and Marxist unions. It's a quaint, slow place where now it is mired in debt, [...]


Eurozone: “Bold” Moves Are Ineffective

“Bold, new”, but ineffective, moves by central banks today signals the fragile nature of the state of the worlds’ economies. They cut rates again in order to stimulate growth.  Push interest rates low enough, they believe, and prosperity will follow. Unfortunately, they have misunderstood the nature of this economic crisis and are doing the opposite [...]


Krugman’s Great Illusion

Krugman-in-Wonderland Paul Krugman is in Spain this week, most likely telling the Spaniards what they want to hear: The European Central Bank can end the country’s unemployment miseries painlessly by buying near-unlimited amounts of Spain’s government bonds and then floating massive amounts of new euros around the world. Yes, for the umpteenth time, Krugman insists that if [...]


Global Terror Update

“The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in iniquity and born in sin. Bankers own the Earth. Take it away from them, but leave them the power to create [...]


This Frau’s Not for Turning (At Least Not Yet)

The Telegraph has an opinion piece out titled Angela Merkel isn’t bluffing; like everyone else in Europe, she’s defending national sovereignty.  It compares her to Britain’s Margaret Thatcher in steadfastness and then says this:

Take this extraordinarily prescient observation by the radical economist Wynne Godley, penned as early as 1992. “It needs to be emphasised at the [...]