The Housing Crisis and Wall Street Shame

One out of four homeowners is now under water, owing more on their homes than the homes are worth. Why? The biggest single factor behind the housing crisis is rising unemployment. According to the latest ABC-Washington Post poll, one out of every three Americans has either lost their job or lives in a household with […]

Historical Rhymes

The debt crisis in Dubai is probably overblown in the media in terms of global economic consequences, but the fear that the problems will spill over into other markets is certainly real enough. But if this sounds like deja vu all over again, you’re right. Been there, done that, you might say. Of course, that […]

Repairing China’s Financial System

The stock market had a bad day today, with the SSE Composite down 3.62%, mainly on rumors that banks will be seeking to raise equity capital next year in response to their loan surge this year.  On Tuesday Bloomberg reported that the five largest banks were supposed to have submitted plans to regulators for raising […]

Details

Now that the financial regulatory reform bills are progressing in both houses of Congress, it means that to really be on top of things, you not only have to read the bills, you have to read the amendments. One example is the Miller-Moore amendment (full text here), which passed the committee 34-32, only to run […]

Will the Obey Plan End the War?

If people had to pay for the cost of the war with an explicit, dedicated tax for that purpose, would they still support it? I think it’s a good idea to make clear what the war costs – e.g. the $11 billion per month the war effort costs would pay for a lot of health […]

We Don’t Know How Black Friday Sales Were Yet

Today, the WSJ ran this patently incorrect headline:    Black Friday Spending Rose Slightly Preliminary sales data showed shoppers spent $10.66 billion on Black Friday. That’s 0.5% more than last year. The figures were compiled by ShopperTrak RCT Corp., a Chicago research firm that tracks sales at more than 50,000 stores That’s simply wrong. We don’t […]

Independent Does Not Mean Unaccountable

As you might guess given my recent posts defending Fed independence, I agree with this:  The right reform for the Fed, by Ben Bernanke, Commentary, Washington Post: For many Americans, the financial crisis, and the recession it spawned, have been devastating… Understandably, many people are calling for change. … As a nation, our challenge is […]

Total Eclipse at the Heart of Dubai’s World

Back in the heady days of 2006 some 30,000 cranes, roughly a quarter of total global capacity, were busy whirring away in Dubai. Today most of these devices have either left to find service in other parts of the globe, or lie silent, unused and unloved. In what is only the latest sign of the […]

The Bust in Dubai and Exogenous Shocks

By now you have heard that Dubai World, the investment company, has asked its creditors for a six-month delay in repaying its debt (see articles in links).  This is what is commonly referred to as default. Now many are wondering if Dubai the country is on the verge of default and asking who is most […]

Does Dubai Matter? Ask Ireland

Presumably the rulers of Dubai and Abu Dhabi are currently locked in negotiations regarding the exact terms that will be attached to a “bailout” for Dubai World.  We’ll never know the details but if, as seems likely, the final deal involves creditors taking some sort of hit (perhaps getting 75 cents in the dollar, at […]

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