Published in November 30th, 2008
What’s Really Going On? or…
Why Did I See it Coming and “They” Didn’t?
Part 2: The Models
“But this long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the [...]
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Published in November 30th, 2008
Dear Subscribers,
There is some technical glitch affecting the blog at present that delays approval of new posts, and often results in multiple postings from the same post. I know these would be irritating to receive, but they are the fault of either the underlying software (Wordpress) or my ISP host, or both.
Once I have time [...]
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Published in November 29th, 2008
Reports that the USA government’s total financial commitments from the financial crisis now top US$5 trillion raise the obvious question “Can they afford it?”.
The answer isn’t obvious. Some economists, from a range of schools of economic thought, argue that the government sector (lumping the Treasury and the Federal Reserve together) has a limitless capacity to [...]
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Published in November 28th, 2008
And now for something completely different…
A correspondent has just passed this beautiful piece of wit along to me: a song about the financial crisis to the tune of the old “Monster Mash” song from the 50s (you know, back when they had banks).
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Published in November 26th, 2008
The Parliamentary Library arranged a debate between myself and Rory Robertson of the Macquarie Group on the financial crisis today. We had a good audience of about 70 Parliament House denizens. You can download the Powerpoint Slides slides for my presentation, and the Vissim model of Minsky’s Financial Instability Hypothesis which was part of the presentation ( Right click and [...]
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Published in November 20th, 2008
Today’s CPI data from the US Bureau of Labor Statistics reveals that consumer prices fell by 1 percent in the month of September. This is the steepest monthly fall in the index since January 1938, and comes after two previous monthly falls (of 0.4 and 0.14 percent). It is therefore possible that a debt-deflationary process is underway.
Monthly [...]
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Published in November 12th, 2008
If things are really grim, it helps to have an indefatigable nature, and there’s no doubt that RBA Deputy Governor Ric Battellino has that in spades—at least in the speeches he makes at public conferences. Were I being crucified, I’d like to have Ric up there with me, singing “Cheer up Brian!…”, to take my [...]
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Published in November 5th, 2008
Yesterday the RBA (Australia’s Central Bank) cut its reserve rate by three quarters of a percent, to 5.25 percent. This is the third cut in 3 months, bringing the cumulative reduction since September to 2 percent
This is a far cry from the RBA’s expectations in 2007, that in 2008 it would be raising rates to [...]
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Published in November 2nd, 2008
2nd Anniversary Issue…
Why Did I See it Coming and “They” Didn’t?
The financial crisis is widely accepted as having started in August 9 2007, with the BNP’s announcement that it was suspending redemptions from three of its funds that were heavily exposed to the US securitisation market (click here for the BNP August 9 2007 press [...]
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