Free Republic

Vedomosti reports that Sergey Glaziev, the economic mastermind behind the Eurasian Union, sent an official report to Kremlin, stating the necessity of a radical revamp of Russia’s economic policy in the wake of the second wave of global economic crisis. “Unknown sources” have provided the media with the contents of this highly controversial document, igniting a fierce debate in the press and blogosphere. Glaziev’s report features apocalyptic predictions in regard to the state of the world economy but the most interesting part of the text refers to the so-called “currency wars”. Basically, one of the most influential advisors of the...

Stockholm University professor Lars Calmfors explains why Sweden has so far escaped relatively unscathed from the financial crisis. As the financial crisis continues to hold much of the world in a vice-like grip, Sweden has become one of few pockets of resistance, where the impact of the recession has been felt less than elsewhere, having learnt vital lessons from its own recent past. However, although government bail-outs, high unemployment and irresponsible consumption have been more rare in Sweden than in many of its European counterparts, it doesn't mean there is room for complacency just yet, analysts warn. The banking crisis...

Inevitable Catastrophe: The Fruits Of Moral Hazard On A Global Scale Insulate participants from risk with policies like the Bernanke Put and you guarantee destruction of both the market and institutional legitimacy. Identify the common characteristic of these three statements: 1. The Federal Reserve will never let the stock market decline, i.e. the "Bernanke put" 2. The Chinese government will never let property prices decline 3. The European Central Bank will never let Greece default The answer of course is moral hazard: a person who is insulated from risk will have an insatiable appetite for risky bets because any gains...

Sweden's Prime Minister Fredrik Reinfeldt has joined forces with UK Prime Minister David Cameron to call for "less talk and more action" to ensure that Europe tackles its economic crisis as EU premiers head to Brussels for crisis talks. In an opinion article in the UK Financial Times on Thursday, Reinfeldt and Cameron lay out "four clear steps" which they argue are needed to ensure that Europe "thrives and prospers". "First we need to get a grip on our debts," the pair write, underlining that as "Sweden has been living within its means it is one of the member states...

The largest economy on Earth is far from bankruptcy, but it is crippled. By launching gigantic bailout solutions, The EU member countries could probably shield off any attacks by the so called "wolf packs" of international specualtors who currently are haunting finacially week nations. But, looking at things from a broader perspective, what is gained for the EU or the world economy as a whole by such maneuvers and for how long could this development continue? Furthermore, who gets to pay the bill in the long run? Is it the Greek/Spanish/Italian workers of today who retire at the age of...

THE worst global economic storm since the 1930s may be beginning to clear, but another cloud already looms on the financial horizon: massive public debt. Across the rich world governments are borrowing vast amounts as the recession reduces tax revenue and spending mounts—on bail-outs, unemployment benefits and stimulus plans. New figures from economists at the IMF suggest that the public debt of the ten leading rich countries will rise from 78% of GDP in 2007 to 114% by 2014. These governments will then owe around $50,000 for every one of their citizens (see article). Not since the second world war...

Spanish Prime Minister Jose Luis Rodriguez Zapatero has announced new economic stimulus measures, including subsidies for people who buy new cars.

The Swedish financial chief known as "Mr Fix It" has been summoned to Washington to advise on how Sweden's model might avert a global banking meltdown. US President Barack Obama cites Sweden as a possible model of how best to tackle failing banks. Mr Lundgren, who was fiscal and financial affairs minister at the time of the last crisis, yesterday outlined the Swedish solution to the Congressional Oversight Panel, which supervises the US administration's troubled asset relief programme.

Why the Fed has no other alternative but to print money! Next time the Fed embarks on its usual money printing exercise, consumer price inflation accompanied by renewed dollar weakness is likely to both exceed asset inflation - especially in the housing sector - and income gains. This should ensure that the forthcoming recession will be characterized by consumer price inflation and simultaneous economic weakness. In the past, I have demonstrated that economic growth and deflation is entirely compatible. The entire economic expansion of the US in the 19th century was a deflationary boom. Declining prices led to strong real...

(10/07) A High-Risk Market ...... Even before the twin hurricanes the consumer savings rate had turned negative, household debt was at record highs and home owners were using soaring home prices as huge ATM machines yielding hundreds of billions of dollars in cash. With housing prices starting to soften, energy prices still high and real wages under pressure, consumers’ ability to spend seems severely restricted in the period ahead. These trends have been further exacerbated by the two hurricanes that have created negative domino effects throughout the economy. So far consumers have felt the impact of higher gasoline prices, but...

BIS warns on domestic and international debt By Chris Giles in London Published: June 27 2005 20:26 | Last updated: June 27 2005 20:26 Growing domestic and international debt has created the conditions for global economic and financial crises, the Bank for International Settlements warned on Monday. The Basel-based organisation's annual report said no one could predict if and when such international economic imbalances would unravel but “time might well be running out”. The warning by the world's oldest international financial institution the central bankers' bank was designed to puncture the complacency prevalent among economic policymakers after 2004's global growth,...

The leaders of some of Germany's biggest companies believe their country faces its worst crisis since the war amid deep scepticism about the ability of the government to solve Germany's problems. Their anger comes as the government of chancellor Gerhard Schröder this week prepares to unveil a unitary 25 per cent savings tax and an amnesty to encourage the repatriation of undeclared savings abroad. Business leaders, surveyed by the Financial Times and FT Deutschland, its sister paper, fear that rises in taxation and non-wage labour costs imposed by Mr Schröder since his re-election in September will stifle already weak growth....