Veren of Lood biedt u op zondag wekelijks een inkijkje in (minstens) 10 belangrijke of informatieve artikelen en interviews die de voorafgaande 7 dagen op economisch terrein verschenen op onafhankelijke sites.

De kop is de link naar het oorspronkelijke artikel, waarvan de samenvatting of de eerste (twee) alinea’s hier gegeven zijn.

Sinds begin december 2015 nemen we ook een paar extra links op naar artikelen die minder specialistische kennis vereisen. Deze met *** gemerkte artikelen zijn ons inziens ook interessant voor lezers met weinig basiskennis van economie.

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The Disaster of De-industrialization – Charles Hugh Smith
15 juni
Once a nation no longer produce essential goods and services, it becomes vulnerable to collapse.
By now, we all know what’s happening in Venezuela: hyperinflation, empty stores, a regime in denial. The Trajectory of Venezuelan Hyperinflation Looks Frighteningly Familiar… (Zero Hedge)
My contacts in Venezuela tell me that merely posting the black market exchange rate of bolivars to USD can get you arrested. So yes, Venezuela’s regime has gone full Orwell-1984: whatever is true is outlawed.
Venezuela is imploding not because of hyper-inflation, but as a result of policies that led to hyper-inflation: policies that generate perverse incentives, disincentives to produce goods and services and incentives to depend on government subsidies.
But one of my correspondents nailed a key cause that is rarely discussed: Venezuela has been effectively de-industrialized. Capital that should have been invested in the electrical grid and the oil industry has been diverted to other pet projects (and the pockets of regime insiders).
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*** Day of Reckoning for Banks in Italy, Spain, & Portugal Kicked Down the Road (Elegantly) for 18 Months – Don Quijones
18 juni
Senior bankers in Spain and Italy can breathe a collective sigh of relief after Europe’s finance and economic ministers decided on Friday to postpone, for at least 18 months, a decision on setting a limit on the government bonds some banks can hold as eligible “risk-free” capital. It was one of four things keeping Spanish senior bankers awake at night. Now, they can sleep a little sounder.
The initiative, initially proposed by the German government and supported by other fiscally hawkish governments such as Finland and the Netherlands, was intended to limit the purchase of public debt by banks, in order to break the vicious cycle of co-dependence that now exists between sovereign and bank risk.
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You are currently living through the dumbest monetary experimental end game in history (including Havenstein and Gono’s) – Eugen von Böhm-Bawerkon
18 juni
We have seen several explanations for the financial crisis and its lingering effects depressing our global economy in its aftermath. Some are plain stupid, such as greed for some reason suddenly overwhelmed people working within finance, as if people in finance were not greedy before 2007. Others try to explain it through “liberalisation” which is almost just as nonsensical as government regulators never liberalised anything, but rather allowed fraud, in polite company called fractional reserve banking, to grow unrestrained. Some point to excess savings in exporting countries as the culprit behind our misery. Excess saving forces less frugal countries reluctantly to run deficits, or so the argument goes.
While some theories are pure folly, others are partial right, but none seem to grasp the fundamental factor that pulled and keep pulling the world into such unsustainable constellations witnessed in global finance, trade and capital allocation.
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A Common Central Bank Tool: Fear Mongering – Tho Bishop
16 juni
Today the Bank of England announced that it would follow the lead of the Federal Reserve and maintain interest rates at .5%. The bank didn’t stop there however, warning voters that next week’s Brexit referendum posed “the largest immediate risk facing UK financial markets, and possibly also global financial markets. “ Considering the growing public support for the UK’s separation from the EU, the statement can be seen as a last ditch effort by the BoE to push back against the effort and the move has been strongly criticized by British politicians skeptical of the EU.
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The pound and the macroeconomic effects of Brexit – Giancarlo Corsetti, Gernot Müller
18 juni
For decades, the UK government has been very careful in ensuring a low-risk status for its public and private debt. This column warns that if the UK opts to leave the EU, uncertainty over the implications of Brexit would put this low-risk status in jeopardy. A depreciation of the pound could well generate an export boom, but this would not compensate for the damage to internal demand and to the UK’s ability to access external financing of its deficits.
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Fear of Brexiting: Recent perspectives on the economics of the UK-EU relationship – Nauro F. Campos, Fabrizio Coricelli
14 juni
The partnership between the UK and the EU has famously been described as “awkward”. A benefit of the Brexit debate is that it has spawned an enormous amount of research addressing issues surrounding the relationship that have been taken for granted for probably too long. This column takes stock of new research presented at a recent conference on the UK-EU relationship.
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The Keynesian Blessing: Americans are Broke – William L. Anderson
12 juni
Writer Neal Gabler recently “confessed” his “secret shame” in an Atlantic Monthly article on how a huge percentage of middle-class Americans are living beyond their means, existing paycheck-to-paycheck, and are mired in personal debt. He writes:
I never spoke about my financial travails, not even with my closest friends—that is, until I came to the realization that what was happening to me was also happening to millions of other Americans, and not just the poorest among us, who, by definition, struggle to make ends meet. It was, according to that Fed survey and other surveys, happening to middle-class professionals and even to those in the upper class. It was happening to the soon-to-retire as well as the soon-to-begin. It was happening to college grads as well as high-school dropouts. It was happening all across the country, including places where you might least expect to see such problems. I knew that I wouldn’t have $400 in an emergency. What I hadn’t known, couldn’t have conceived, was that so many other Americans wouldn’t have the money available to them, either.
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Rules of the monetary game – Prachi Mishra
16 juni
All monetary policies have external spillover effects. However, the domestic mandates of most central banks may not legally allow them to take spillovers into account, and may force them to undertake aggressive policies so long as they have some small positive domestic effect. This column looks at the rules of the game for responsible policy in such a context. It proposes a ‘traffic light’ system to identify policies that should be encouraged by the international community, policies that should be used temporarily and with care, and policies that should be avoided at all costs.
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*** An Everyman’s Guide To Understanding Cryptocurrencies like Bitcoin – Charles Hugh Smith
13 juni
Cryptocurrencies have a role that could increase as global currencies are devalued.
When an asset rises by almost 30% in a few weeks, it tends to attract attention. Recently, that asset was bitcoin (BTC). The price of BTC in dollars rose from $454 on May 23 to $590 on June 6th. (NOTE: BTC has since jumped by $70, from $580 to $650.)
When an asset doubles in a matter of a few months, it tends to attract attention. The cryptocurrency Ether (part of the Ethereum platform) doubled from around $7 in April to roughly $14 in early June.
Are these cryptocurrencies mere fads? Or are they potentially game-changing alternatives to the conventional currencies such as the U.S. dollar, Chinese RMB, Japanese yen or European Union euro?
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*** These Debt Slaves are the Government’s Largest Asset Class, and it will Haunt the Economy for Years – Wolf Richter
13 juni
Endless discussions of how important inflation is to the US economy, and how there hasn’t been enough of it in recent years, and how more inflation would be a godsend, has become the standard. The threat of lethal deflation is being brandished to rationalize all kinds of absurd monetary policies. And we know why: inflation is good only for debtors, in an over-indebted country.
But that’s not true either. Because a lot of debtors, particularly those who funded their education with loans, are being strangled by … inflation.
“College Tuition and Fees constitute one of the biggest threats to our economic outlook,” writes Jill Mislinski at Advisor Perspectives, which runs an excellent series of analyses and updates on the topic.
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*** Brexit – The End of the Universe – Mathew D. Rose
16 juni
The other morning I was astounded by an interview I heard in German state radio. It was in Deutschlandfunk, which specialises in news and current affairs. It is considered by many to be the most serious and objective radio station in Germany.
In this case the moderator was querying the EU parliamentarian Sven Giegold of the Greens concerning the upcoming referendum, also known as Brexit, in Britain to leave the European Union. Giegold is a clever chap, in fact one of the few talents in Brussels. One of the moderator’s first questions was if it would not be better if Germany’s Finance Minister Wolfgang Schäuble, the EU Commission president Jean-Claude Juncker and Donald Tusk, the president of the European Council went to Britain to make the case for Remain in the upcoming referendum.
This question reflects some very basic problems that are plaguing Europe’s elite and its obsequious media. The first is a specifically German one: Authority should not be questioned. In other words when such powerful figures as the German Finance Minister and the presidents of the European Commission and Council tell you to vote Remain, then there can be no doubt what you should do.
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Review of The Midas Paradox: Financial Markets, Government Policy Shocks, and the Great Depression by Scott Sumner – RobertB. Murphy
15 juni
The Midas Paradox is an impressive piece of scholarship, representing the magnum opus of economist Scott Sumner. What makes the book so unique is Sumner’s use of real-time financial data and press accounts in order to explain not just broad issues—such as, “What caused the Great Depression?”—but to offer commentary on the precise zigs-and-zags of the economy during the 1930s.
Sumner rejects the standard Friedmanite monetarist “long and variable lags” approach, and argues that financial markets respond virtually instantly to new information, including announcements and events that would change expectations about the future path of monetary policy. Both because of his methodological innovations and his painstaking research, Sumner’s book is an invaluable resource to economists and historians interested in the Great Depression and the operation of the classical gold standard.
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Disclaimer: De VoL-redactie selecteert deze artikelen op interessante inzichten, of naar wij denken nuttige informatie. Wij kunnen echter geen enkele aansprakelijkheid aanvaarden voor de gevolgen van beslissingen die op grond hiervan door lezers zijn genomen, zakelijk zomin als privé.