Arun Duboisâ€™ blog post yesterday on Modern Monetary Theory has prompted me to write my own take on the subject.Â For those interested, an interesting thumbnail sketch of MMT, essentially functional finance augmented by a full understanding of monetary operations, is explained here. While MMT deals with the details of monetary and fiscal matters, the implications of its analysis are […]Read more
Last week, Travis noted Terry Corcoranâ€™s strained argument that over-regulation of banks is what ails the global economy. Terryâ€™s next column went even further off the deep end, endorsing the hard-money libertarianism of gold bugs like Eric Sprott. Todayâ€™s column is a full-blown defence of the US Tea Party. I have the following response to the gold-bug column in todayâ€™s […]Read more
One nice thing about Canadaâ€™s financial regulatory architecture is the provision that the bank act must be reviewed every 5 years.Â This gives us all a time to take stock of the direction that bank regulation is heading. Â This is the year we are due forÂ the Bank ActÂ review. After a couple of years of financial crisis, it might seem […]Read more
Lessons from the Eurocrisis: If the fire marshal is saying that you shoulda had a fire detector, it might already be too late.
In the current battle against an all-out conflagration in Euroland, markets are twitchy about European (and other) banks in the event that the firefighters donâ€™t get ahead of the blaze.Â If markets lose confidence in those large banks exposed to the problems in Europe (or anywhere else, for that matter), the next chapter in the financial crisis will be a […]Read more
I’d get popcorn to watch ECB vs. the speculators, if the whole sorry story weren’t so sickening. The European Central Bank is meeting today to figure out what the bleep to do about this mess in Europe (the press conference is happening as I write). In the lead-up to the ECB announcement, non-core bonds (like Spainâ€™s) were doing well in […]Read more