David Ricardo is the dominant British economist of the nineteenth century, just as Adam Smith was the dominant economist of the eighteenth century, or Maynard Keynes of the twentieth century…
December 12th, 2008 | William Rees-Mogg | 2 comments | ContinuedArchive for William Rees-Mogg
Leading political editor William Rees-Mogg is former editor-in-chief for The Times and a member of the House of Lords. He has been credited with accurately forecasting glasnost and the fall of the Berlin Wall – as well as the 1987 crash. His political commentary appears in The Times every Monday. His financial insights can only be found in the Fleet Street Letter, the UK's longest-running investment newsletter.
Irving Fisher Has Come Back Into Fashion
It is extraordinary how the great American Economist, Irving Fisher, has come back into fashion. In the last week I have seen substantial references to him in The Times of London…
November 28th, 2008 | William Rees-Mogg | 5 comments | Continued
Contrarian Thinking Secured Me Against Over Optimism in the Boom Years
I call myself a contrarian, and contrarian thinking secured me against over optimism in the boom years of the 1990s and early 2000s…
November 21st, 2008 | William Rees-Mogg | 6 comments | Continued
Bear Market to Last at Least Five Years
The first is that the bear market on Wall Street is entirely likely to last for as long as five years. Of course, the recession in the economy could be shorter, though there is no guarantee of that. The second is that we may have to expect a relatively long period of high dividend yields and high price-earnings ratios.
November 14th, 2008 | William Rees-Mogg | 9 comments | Continued
European Governments of the Eurozone are Separately Responsible for Their Euro-debt
About a year or two ago, I expressed a doubt that the euro could survive a major shock, such as had repeatedly occurred in the Europe of the twentieth century. I mentioned the two World Wars, the Russian Revolution and the Great Depression as three events which would probably have led to a break up of a single European currency…
November 6th, 2008 | William Rees-Mogg | 2 comments | Continued
Economic Crisis Discussions in the House of Lords
We have recently had an innovation in the House of Lords, and a good one. The Lady Speaker invited a group of peers with experience or knowledge of economic policy, to discuss the present economic crisis. There were four speakers, one of whom was Nigel Lawson, an ex-Chancellor of the Exchequer from the Thatcher years. There was also a group of peers and a group of journalists who joined in the discussion. The House of Lords, like any other House of Parliament…
October 31st, 2008 | William Rees-Mogg | 1 comment | Continued
Financial Crises in History
We all have our favourite financial crises which fascinate us by their dramatic sequence of events. Professor Galbraith was fascinated by the 1929-1933 Great Crash…
October 24th, 2008 | William Rees-Mogg | 1 comment | Continued
Politics and Investment Intertwined
The credit crisis came at the weakest possible moment of the American political cycle, the last period of an outgoing Presidency. The first serious sign that subprime mortgages were toxic came in the middle of 2007, approximately six months before the start of the 2008 primaries. The first crisis came in August 2007. When the President put the Paulson Bill to Congress, his authority was at its lowest, and he initially failed to persuade Congress to pass the Bill…
October 9th, 2008 | William Rees-Mogg | 1 comment | Continued
Business Cycle Theory Explained by Joseph Schumpeter
Schumpeter is important because he developed a theory of business cycles which puts its emphasis on industrial innovations rather than banking. Most business cycle theories put their emphasis the other way, and are essentially monetary. Maynard Keynes is just as much a monetary economist as Milton Friedman when he comes to his explanation of business cycles. This is surely an argument which is going to be reopened…
October 2nd, 2008 | William Rees-Mogg | 3 comments | Continued
The Glass-Steagall Act Kept Banks in Order Until 1990
In 1933, the United States passed the Glass-Steagall Act, which prohibited commercial banks from dealing in investments, and prohibited investment banks from doing commercial banking activities. This was a very sensible measure, and kept the banks in reasonable order until 1990. Unfortunately, in 1990, this Act was repealed – for reasons best known to the psychiatrists of the legislators…
September 25th, 2008 | William Rees-Mogg | 5 comments | Continued