Sound Banking

Tuesday, April 20th, 2010
Free markets depend on truth telling. Prices must reflect the valuations of consumers; interest rates must be reliable guides to entrepreneurs allocating capital across time; and a firm's accounts must reflect the true value of the business.
Tuesday, April 20th, 2010
"While, in hindsight, some of the data available to the Federal Reserve and other authorities gave notice of the financial crisis, more data and a different approach to analyzing them are needed if a reliable 'early warning system' for future crises is to be developed, according to research by Feder
Thursday, April 8th, 2010
"Inflation is a sustained increase in the aggregate price level. Hyperinflation is very high inflation. Although the threshold is arbitrary, economists generally reserve the term 'hyperinflation' to describe episodes when the monthly inflation rate is greater than 50 percent.
Wednesday, April 7th, 2010
"Almost everyone is aware that federal government spending in the United States is scheduled to skyrocket, primarily because of Social Security, Medicare, and Medicaid. Recent "stimulus" packages have accelerated the process.
Tuesday, April 6th, 2010
"What must be done to recover from this financial crisis? Barack Obama rightly stresses that we first must understand how today’s problems emerged. It is 'only by understanding how we arrived at this moment that we’ll be able to lift ourselves out of this predicament.'
Thursday, April 1st, 2010
"The new requirements form part of new guidance from the Office of Fair Trading (OFT) to counteract irresponsible lending. '[We] expect all consumer credit businesses to fully comply with both the word and spirit of this guidance,' the OFT said.
Wednesday, March 31st, 2010
"The unemployment rate in the euro area inched up to touch double digits in February, while inflation accelerated more than economists had forecast, probably a result of higher food and oil prices, according to data released Wednesday.
Wednesday, March 31st, 2010
"The Seigniorage Curse appears to hollow out the economy by the following manner: First, the premium charged to holders of dollars becomes a new source of accrued, aggregate revenue.
Wednesday, March 31st, 2010
"Alan Greenspan, Ben Bernanke, and the rest of the crew running economic policy somehow could not see the housing bubble as it grew to more than $8tn. It really should have been hard to miss. Nationwide house prices had just tracked overall inflation for 100 years from 1895 to 1995.
Tuesday, March 30th, 2010
"Chinese economists and business leaders have begun to call openly for their government to allow the yuan to appreciate against the dollar, in a sign that the issue is contentious here, too, and not just a problem between the United States and China.
Monday, March 29th, 2010
"One part of Alastair Darling’s Budget that appears to have received little attention from the media is his plan for a 'Credit Adjudication Service'. This new body, it appears, will provide an appeals process for small and medium businesses that have been denied credit by banks.
Wednesday, March 24th, 2010
"Inflation rates vary from year to year and from currency to currency. Since 1950, the U.S. dollar inflation rate, as measured by the December-to-December change in the U.S. Consumer Price Index (CPI), has ranged from a low of −0.7 percent (1954) to a high of 13.3 percent (1979).
Tuesday, March 23rd, 2010
"The bond market is saying that it’s safer to lend to Warren Buffett than Barack Obama.
Monday, March 22nd, 2010
"Sen. Chris Dodd's latest bill to fix the financial system is another failure. After months of negotiation, he's produced a "reform" of the regulatory system that simply fails to deal with the causes of the 2008 crisis -- which nearly saw the collapse of the US banking system.
Thursday, March 18th, 2010
"One of the sadder categories in the history of human misfortunes is the list of those things that are obvious, but wrong. By definition, if something is obvious, most people agree with it, and thus, it is likely to win the day - but lose the verdict of history. The Earth is flat - obviously.
Wednesday, March 17th, 2010
"The Fed's own origins are evidence for this point. It is usually argued that the Fed was created to avoid the banking crises that plagued the United States in the late 19th century. That is true to an extent.

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