U.S. Garage Sale Corporations that file for bankruptcy typically have their debt discharged — zeroing out their shareholders — and their new equity issued to erstwhile creditors. What’s the equivalent for sovereign nations? Put it this way: what would Alaska fetch on the open market? Seward’s Folly When Secretary of State William Seward orchestrated Alaska’s...Read More
“The Liquidity Interest Rate Trap” Well I don’t know why I came here tonight, I got the feeling that something ain’t right, I’m so scared in case I fall off my chair, And I’m wondering how I’ll get down the stairs, Clowns to the left of me, Jokers to the right, here I am, Stuck...Read More
A Year to Remember — With 9-plus Months to Go Looking back over the last — oh — couple decades, there are years that simply fade into history, when nothing memorable or significant seemed to happen. Like 1994. Or 2006. Or the seventies. 2011 is not going to be one of those years. Between the political...Read More
The Fed, Commodity Prices & Economic Recovery Twelve hundred miles (give or take) from Wall Street, me thinks that a not-so virtuous cycle has emerged regarding the government’s various and sundry efforts to nurse the economy back to health. The dynamic goes something like this: Step 1: the Federal Reserve and Treasury essentially borrow and/or...Read More
