The Evils of Inflated Credit
Thursday, 03. 12. 2009 – Category: Uncategorized
The questions of currency and credit are closely interlinked. The inflation of credit does not necessarily lead to inflated currency, and deflated credit does not necessarily lead to deflation of currency, provided the balancing act is done carefully. A spanner in the works can cause all sorts of problems.
It could be argued that the inflated [...]
What is a Recession?
Thursday, 03. 12. 2009 – Category: Downturn
According to the National Bureau of Economic Research, the United States has been in a recession since December of 2007. We are currently undergoing one of the most severe recessions in United States history. Recessions can be times of great fear and widespread panic. A recession is a normal stage of the business cycle. The [...]
Deflation – the Real Enemy of Your Successful Business
Wednesday, 03. 11. 2009 – Category: Downturn
Deflation -far more dangerous than inflation – is becoming a very real danger to your business. Central Banks traditionally believe that printing money cures deflation by increasing inflation – an over-application of Keynesian economics. But does history support this view?
The Japanese experience suggests that the “printing money” approach does not work – neither do zero [...]
Can the Great Depression Happen Again?
Monday, 03. 9. 2009 – Category: Downturn
As we enter 2009, many if not most agree that the US economy is struggling, and that these struggles will continue. An increasing number have been making comparisons to the Great Depression. With that in mind, let’s compare and contrast the situations:
Similarities
1. Both were preceded by an extensive period of credit-fueled bubbles. Before there was [...]
We must print more money, says Bank
Thursday, 03. 5. 2009 – Category: Downturn
Governor appeals for urgent action to salvage Britain’s shrinking economy
By Sean Farrell, Financial Editor (http://www.independent.co.uk)
The Bank of England is to start ‘printing’ new money for the first time in 30 years as it runs out of options to kick-start the economy. The Governor of the Bank of England will write to the Chancellor within days [...]
Primer on Quantitative Easing
Wednesday, 03. 4. 2009 – Category: Downturn
JONATHAN ASHWORTH, ECONOMIST, BARCLAYS
As interest rates headed towards zero after the collapse of investment bank Lehman brothers in September 2008, the
US Federal Reserve (fed) began to engage aggressively in what is commonly referred to as ‘quantitative easing’ (QE).
Moreover, as the global slowdown and ‘credit crunch’ have intensified, the bank of Japan (BOJ) has resumed QE [...]