All Posts Tagged With: "central bank"

Whenever a central bank cannot provide direct, overt assistance to a specific insolvent investment bank or government, not to worry, a central bank can still provide indirect, covert assistance.

What’s this? Christine Lagarde, IMF chief, said last week that the world’s nations needed to work together to avoid a 1930s-style depression.

But seeing the way they work together…and where they seem to be headed…we’d prefer an economic depression.

Basic economics of scarcity, supply and demand, and investment demand won’t be less important in supporting commodities. But in a world of collapsing financial asset values, tangible assets are about to become the hotly contested objects of a great global strategic game.

“Hooray” for democracy.

From out of the blue, Greek president George Papandreou has called a referendum on the Greek debt situation and whether Greece should accept the terms of the financial and political surrender imposed on it by the “Troika” of interventionists from the International Monetary Fund (IMF), the European Union (EU), and the European Central Bank (ECB).

Napier’s discussion of cycles in stock market valuation is based on the work of Yale Professor Robert Shiller, and his now-famous “Shiller P/E ratio.”

But more importantly, the share market is at risk now for a big fall as it was in the middle of 2007 when the Bear Stearns story broke. Since then the perimeter of global markets has gradually been overrun by the forces of wealth destruction.

There must be some dark corner of Hell warming up for modern, mainstream economists. They helped bring on the worst bubble ever…with their theories of efficient markets and modern portfolio management.

Bullard said, that, “If the economy came in very weak, let’s say, in 2010, weaker than expected, we would have the option of doing further quantitative easing.” The Fed would do this through additional asset purchases, presumably with more, uh, “money” it created.