Relevant and even prescient commentary on news, politics and the economy.

Is This A Bad Thing? Sane Economists would say No.

Yes, I’m working with the null set again, but Peter Bockvar, chez Ritholtz, raises the most common objection to the Greek restructuring’s likely effect on the CDS market: [I]t will…potentially destroy [the sovereign CDS] market to the point where it will go away. The unintended consequence of what will be next will be those looking […]

Europe’s at it again…

Key European CDS are starting to turn in the more northern direction again, as the German-French ‘pact for competitiveness’ faces near-unanimous pushback across Europe. Credit default swaps (CDS) are a market security used by investors to buy 5-yr protection (in this case) against default (or the like). As the spread rises the implied probability of […]

According to bond markets, Ireland is not yet Greece

A few articles regarding the bond crisis in Ireland: The Irish Mess (IV)ECB buying of Irish bonds ‘vital’ supportThe world backs away from Ireland, Spain, PortugalIn keeping with Halloween, here’s a scary oneEU leaders trigger another bond market crisisIreland fifth best place to live (a separate issue, of course) Yves Smith’s article (first link) is […]

US Federal deficits

Mark Thoma posted yesterday Is Galbraith Right that Deficits are Never a Problem? on Paul Krugman’s NYT piece I Would Do Anything For Stimulus, But I Won’t Do That (Wonkish) on MMT and soveriegn debt (using Angry Bear’s posting of Jamie Galbraith’s testimony to Congress as a link), and has included Jamie Galbraith’s response. It […]