Monthly Archive:: July 2012

Interest income loss from rate cuts

Word’s getting around, from CS: The side-effect of the Fed’s near-zero interest medicine – the collapse in personal interest income over the last few years. The decline in interest income actually dwarfs estimates of debt service savings. Exhibit 2 compares the evolution of household debt service costs and personal interest income. Both ...Read More

Saudi Crude Oil Production

Saudi production up a tad for July. With the Saudis posting prices and letting their clients buy all they want at the posted prices, this shows marginal global net demand has yet to fall off, and, in fact increased a bit. And, if Saudi excess capacity isn’t as high as the 12.5 ...Read More

More from the 1996 conference

More from the AVM 1996 conference anticipating today’s issues attached. Feel free to distribute: Cover Page 1 Page 2 ...Read More

Trade Weighted Euro vs EU Trade Balance

Interesting dynamics at work. Trade can drive the currency and/or the currency can drive trade. Looks to me like early on it was the trade that was driving up the currency, But more recently the currency looks to be driving trade. That is, portfolio managers have been shifting out of euro due ...Read More

Eurogroup chair sees decisions soon in debt crisis

Note that past remarks indicate the euro leaders equate ‘success’ with ‘strong euro’, particularly the ECB, with its single mandate. So with the euro reacting positively to Draghi’s ‘pledge’, which came after a decline in the euro, more of same is encouraged. Eurogroup chair sees decisions soon in debt crisis By Geir ...Read More

mmt euro discussion origins

This is from Pavlina’s paper for those of you tracing origins of MMT euro discussion: Link here. Notice how in private correspondence Mosler applies the same logic in analyzing the ramifications of the restrictions on deficit spending in the current plan for European Monetary Union: Operating factors will require reserve adds and ...Read More

MERKEL, HOLLANDE READY TO DO ANYTHING TO PROTECT EURO

Seems the turning point may have been early June when Trichet made a proposal that included the ECB, as previously discussed. And note, also as previously discussed, it’s all about ‘the euro’ meaning ‘strong currency.’ So a big relief rally with the solvency issue resolved, and then just the reality of a ...Read More

History of MMT and the euro, 1996 Bretton Woods Conference

Found this on the net in the PK archives. Shows MMT was on it well before this date. Feel free to distribute To: PKT Academics Re: Bretton Woods Conference Confirmed attendance includes senior staff from Deutchebank, Credit Suisse, J.P. Morgan, Banker’s Trust, Salomon Bros, Lehman Bros, Harvard Management, III, Petrus, Paine Webber, ...Read More

June DGOs/July 20 Claims-Weaker CapEx; Jumpy Claims

Karim writes: June DGOs/July 20 Claims-Weaker CapEx; Jumpy Claims Durables data was unequivocally weak. Core orders (ex-defense and aircraft) were down 1.4%. The 3mth annualized rate is now -5.1%, a steady decline from the double digit growth pace of 2011. This feeds into Bernanke’s view that some of the gains in employment ...Read More

ECB’S NOWOTNY SEES ARGUMENTS FOR GIVING ESM A BANKING LICENSE

Yes, I think it’s all still happening as suggested last month after Trichet proposed a plan that included the ECB. Lots of market vol, doubts, fears, etc. and all for good reason as it could fall apart as easily as it could all succeed. I still lean towards the latter. From Dave ...Read More