World Economic News (Wed 23rd. March ’11)

MuniBonds, Fed goes blogging, Taylor rule, Canada Australia housing, Taiwan, Ireland, EU, Bahrain, Russia.

Links – 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.


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  • Anonymous

    Evening Nick.

    Your Irish crisis link has some interesting comments…..

    Depending on which side of the fence the writer sits, his/her view is obvious with a few
    of the comments written…..

    Maybe it is because I am not Irish, and certainly don’t consider myself European, that the answer for me
    falls somewhere in the middle….

    Both sides should take a hit, as both sides were involved…. The Irish have borrowed inappropriately, and the banking institutions
    have lent inappropriately….

    How much each side should have to suffer is another debate, but surely both sides should bear a weight…???

    One point I do pick up on, is the opinion that the foreign banks were gambling or speculating when lending, although this may
    be true, plenty of loans made to construct housing and for the purchase of housing by Irish nationals could be considered speculation
    also…… Speculation on house prices rising, forever….
    This was also prevalent in the commercial construction sector, as “too close for comfort” relationships formed between
    politicians and industry leaders in construction firms….

    To sum up, I feel the problems are complex, and some are greater than others, but, a realistic option must be found, and I feel
    for that to happen, both sides must bend…… Maybe Ireland has done a lot of bending already….??? Maybe Merkel and co
    are going to have to look to the creditors to bend a little more…???

    The comment regarding Germany’s “history” is telling of how discontent toward them will grow, and there will be opportunities
    for less than savory characters to play up to this bad feeling….

    • Mystic

      Would you believe that I was brought up on the expression…..`Fair~?…..A nigger’s left ear never is~!`.
      (it wouldn’t be allowed now would it)
      Not all the Irish borrowed, but all the lenders lent.
      The `criminals` were some of the developers (but, it is not yet criminal to be a developer).
      First stab is to stick with `the law`. Unfortunately this comes down against all the Irish people.
      Europe could do more to help them, but only by changing `their laws`.
      Required watching for all (punch line at 04:00)

      • Anonymous

        Nice vid clip Nick,

        I take your point that maybe there is no way to “win”, but a scenario where both sides live to fight on
        is preferable to one side going down… It’s is more about the system “winning” now, so we don’t all sink…:)

        I agree not all Irish borrowed, and although all lenders lent, not all of the loans were sour….

        It reminds me of a saying I grew up with….. “Being Tarred with the same brush”…..

        Unfortunately, it is human nature to group individuals together, even though some did not participate….
        I do feel that both sides must take losses without sinking themselves in the process, or the system as a whole,
        after all, the market is key to every nations survival at the moment, with most running deficits…..

        The only problem then, would be the domino effect on the Bond markets….
        The higher interest rates that would result from Bond defaults would make debt burden too much to carry
        for most nations, but like wise, a crippling debt for such a small economy will probably lead there as well….

        Now, where is that sand, I need to pop my head in for a break…??? :)

        • Mystic

          Not all loans were sour….(I think they probably were).

          How about – The more `professional` you were……the more guilty you were~? (but then, who would sort that out~?)

          We have a breed of people involved called `politicians`. They can lie, cheat and steal; but somehow like to `look good` while doing so.
          This, linked with the fact that, `it is them what have the power`……. we have our Kobayashi Moru.
          Their power is more important than the lives of the people.

          (it can work like that for a long time……but if we glance at the Arab world, we see it doesn’t last forever)
          (and maybe in the `more civilized West, it won’t last long at all~!)

          • CSArichardo

            Decided too quickly to make a rescue and fell into a trap. Not sure how it is a no win unless you assume that making the rescue was more important than not entering the neutral zone in the first place to attempt a rescue of a vessel that did not actually exist!

            My take away is that politicians today have us convinced that their wars are to save the people when we are in fact falling into a fiscal trap. That scenerio is playing out as the wrong decisions get made. Do you have your escape pod ? The chief politicians likely do as they will not go down with the ship.

          • Anonymous

            Yes, the politicians were complicit, and that is a problem in itself….
            The cosey relationships built with big business can lead to all sorts of problems, and always does….

            The interesting scenario now, is that maybe those Irish politicians won’t have the power after all, because the
            German and French have different interests now, and will try to enforce their will….

            I agree with you though, that working it “fairly” ( that word again ) is damn near impossible…..

  • CSArichardo

    Currently visiting Florida which has no state income tax ! Figure that ? You are so European centric which is great but do not neglect the fact that the US and EU have the same big problems. What if Ireland and Greece had no income taxes ? The entire system is more complicated than we think. Both the US Fed and EU will bail out countries and states based upon GDP..wait for it.

  • Anonymous

    Thanks for making vids available for I pudding device. Good listening whilst driving. Powerfull resourse is the mystic.

    • Mystic

      But what if I say something `funny` and you drive off the road laughing, into a bush~!?

      • Anonymous

        I only have a few thinks when I drive.