WSJ: “European Firms Borrow at Subzero Rates” “Capitalism, almost commonsensically, cannot function well at the zero bound or with a minus sign as a yield. $11 trillion of negative yielding bonds are not assets ” they are liabilities. Factor that, Ms. Yellen into your asset price objective. You and your contemporaries have flipped $11 trillion...Read More
“An Attempted Hypodermic Straight to the Economy’s Heart” A fascinating, even feverish dialogue is taking place right now — joined by some of the financial world’s most influential thinkers — concerning what will happen next week, and what economic consequences will flow from that outcome. The elections next Tuesday? Try, the Fed’s much-signalled intention to...Read More
Limits to “Hair of the Dog” Fix For Sovereign Borrowing Hangover Can you get out of a debt crisis by piling on another layer of debt? The answer, of course, is that “it depends.” Replacing corporate and mortgage debt with a government checkbook is initially beneficial because the sovereign is assumed to be more creditworthy...Read More
