Variant Perception: A Primer on the Euro Breakup

You may have already noticed that this one has been going the rounds. The piece is mainly driven by my colleague Jonathan Tepper’s work on the history of currency union breakups and how they work (or don’t).

It is a big piece in its entirety but the different sections can be read as standalone arguments. . . . → Read More: Variant Perception: A Primer on the Euro Breakup

Global Monetary Relief from Asia

The ECB and BOE have shown their intent with their recent aggressive balance sheet expansions and the Fed is trying hard to keep the door open for more QE even as the data in the US continues to defy the general global slowdown.

In Asia however sticky inflation in India, a desire to nail . . . → Read More: Global Monetary Relief from Asia

Where Are the Handcuffs?

For this blatantly illegal act:

The Federal Reserve Open Market Committee (FOMC) has made it official: After its latest two day meeting, it announced its goal to devalue the dollar by 33% over the next 20 years. The debauch of the dollar will be even greater if the Fed exceeds its goal of a . . . → Read More: Where Are the Handcuffs?

OK, Yes, I'm a Gold Bug

More of a silver bug, actually. But a metal bug. I like having the real stuff, and I particularly like having it already broken down into known increments that are reasonably spendable (or will be, as more and more people decide that precious metals make more sense than paper backed only by “the full . . . → Read More: OK, Yes, I’m a Gold Bug

The Reality of Central Banks

Karl Denninger:

Make no mistake, the problem does not lie with The Fed per-se.  The Fed’s “low interest rates” are there to permit the profligacy of the government, yet the longer it goes on and the more the government abuses this deadly embrace the further into the coffin corner The Fed and Congress go.  . . . → Read More: The Reality of Central Banks

Inflation targeting has come to the US

Reportage by Robin Harding and Michael Mackenzie in the Financial Times:

The rate-setting Federal Open Market Committee predicted low interest rates until late 2014 and set a formal inflation objective of 2 per cent, reflecting chairman Ben Bernanke’s long-held goal of providing greater transparency. The FOMC downgraded its estimate of growth in the coming . . . → Read More: Inflation targeting has come to the US

A Third Option

Karl Denninger:

In many ways the monetary policy issue is even more important, simply because we are running out of rope on our national debt-addiction rappelling adventure and the floor is still 100′ down.  That’s a serious problem — and “gold standards” do not (in fact cannot!) fix it.  The only fix that works is to demand and enforce a . . . → Read More: A Third Option

ECB/Fed Support for the European Banking System - 750 billion USD, and counting ...

One point that I have been shouting from the proverbial roof tops in my research, to partners and colleagues is that 2012 may well be the year when all major central banks will be conducting both conventional and unconventional monetary easing at the same time. I think this is a very strong testament not . . . → Read More: ECB/Fed Support for the European Banking System – 750 billion USD, and counting …

European Bank Runs And Underestimated Physical Gold Demand

The demand for gold is vastly underestimated. About 18 months ago I wrote about Euro Gold and the Euro Zone and Euro Evaporation Leading To Credit Default Swaps and IMF Gold. One key excerpt was:

The Euro is broken. This was its destiny. This is the destiny of all fiat currencies. These bureau-rats cannot . . . → Read More: European Bank Runs And Underestimated Physical Gold Demand

Ideology and Pragmatism

ASI, on Friedman’s pragmatism:

He is known, of course, for his work on money and inflation. But he did not propose, as Hayek did, competition in currency production. He thought the reality of our times is that governments are in control of the money supply, so the question is simply how to sustain them. . . . → Read More: Ideology and Pragmatism