Tag Archives: GFC
III Four Challenges
The so-called international monetary non-system has four serious weaknesses. They are as follows: first, the absence of incentives to governments to correct global payments imbalances; secondly, the system’s dependence on one national currency, the US dollar, to serve as the major international reserve currency; thirdly, a dysfunctional financial sector and, fourthly, the systemic liability to…
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How the international monetary system holds back recovery
Ever since the end of Bretton Woods, exchange rate volatility driven by diverse monetary policies and diverse expectations about future exchange rates have been frequent sources of shocks to the world economy and national economies. The very existence of independent central banks with independent monetary policies is the common origin of shocks. The more…
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Christine Lagarde gets it wrong
“The financial system can work if each of its members follow the right principles for their economy” M Lagarde has had a successful year at the Fund but this statement at the G20 meeting in Moscow yesterday shows the Fund has not learnt the key lesson of the economic disaster. The mistaken…
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My New Year wishes
The world economic recovery remains fragile and could easily be derailed by renewed financial turmoil. My first wish is a terminological one – please, can we find a more useful word or phrase to describe what has happened? The word “crisis” and the phrases “financial crisis” , “great financial crisis”, “Global Financial Crisis” ,…
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Some nuanced views of Mr Carney
The UK media have been gushing in their welcome. It is right to welcome central banking’s “rock star”. But not everybody has been carried away by the euphoria…you only have to scan the Canadian press today: Andrew Coyne at the Montreal Gazette That our banking system was not so badly mauled by the crisis as…
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What’s the G30 doing?
It follows the appointment of G30 member Mario Draghi to be president of the European Central Bank (which raised eyebrows in some circles, see here) . Last year also member Mervyn King became chair of the Group of Governors and Heads of Supervision (GHOS), the Global Economy Meeting (GEM) and the Economic Consultative Committee…
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Keynes, Mundell and The Money Trap
Most economic commentary, such as that of Roubini, falls into this category (see Diary of 21/11/12). The “analysis” amounts to saying: “Oh, what a mess we are in!” We knew that already. Some vary their message by claiming to detect chinks of light in the gloom. Others conclude by saying things like, “If only the…
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It’s the system, stupid!
One very senior former policy-maker has written to express his broad agreement with the analysis in The Money Trap. He cites three sentences on page 33, which sum up my review of the performance of the world economy since the collapse of Bretton Woods in the early 1970s: “The severity of the financial crisis…
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A five-point reform plan
Joseph Potvin of The Opman Company has sent me an “operational summary of the Ikon monetary standard and unit of account”, which I am pleased to share with visitors to this website. Thank you, Joseph, for going through the book so carefully and distilling the reforms it proposes in Part 4 to the global…
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Eurozone to lead world out of the money trap?
There is a long, long way to go. But confidence is gradually returning to the eurozone – confidence that at least a break-up of the eurozone will be avoided (thought his does not exclude the possibility that Greece may leave). The fall in spreads on Spanish and Italian bonds over German bunds is one…
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