So the “right party” wins the election in Greece supporting the bail out. Â Good news? No, not really. The ECB and European (aka German) policies on Greece are doomed to fail. I tweeted this morning that all I don’t see any good news, but I can small straws burning. Those are the straws that are…
The previous head of the Hong Kong Monetary Authority has suggested that HK should consider a different monetary system than the peg to the US Dollar. Most others seem to think it’s a mad or at least premature idea. What it isn’t is a suggestion to move to a gold standard -Â I’m looking forward…
Fascinating idea.  Should Germany leave the Euro to save it? Would these be a less catastrophic result than several Southern countries leaving? What does this mean for runs on banks? It’s not all straightforward. We could still end up with a run on non-German banks since the  appreciation of the Deutschmark would correspond with a…
Yes, government bond yields around the world are plummeting to all-time lows. Â They’re falling through the floor as investors realise the global economy is about as close to the drain as it’s been even through the “Global Financial Crisis”. What do you mean “what about Greece and Spain”? Government bond yields are plummeting everywhere except…
Volatility skew didn’t exist before the 1987 market crash. Before then, the assumptions of the Black-Scholes option pricing model were felt to be about right. Constant volatility, continuously tradeable instruments with no discontinuities in prices, independent returns from one period to the next. Then the market crashed downwards exhibiting leptokurtic, negatively skewed returns and large…
Paul Krugman debates Ron Paul on live TV. Ill-advised or not, it is interesting to see their different takes go head to head. I’m not sure either really puts their points across very well, but I was a little surprised to see the vitriol in the comments of the YouTube video against Paul Krugman. Ron…
Bitcoins are a bad idea. Â I’ve put this forward from multiple directions already. What’s interesting is the range of new, government-sponsored digital currencies that are in development. Digital currencies might also be a little bit of a stretch, they’re still more like digital payment methods. Unlike Bitcoins, there is much to recommend about low-cost, high-security,…
For every complex problem, there is a solution that is clear, simple and wrong. Greece is a complex problem. Paul Krugman points to this Choose Your Own Adventure on the Greek crisis. Much like the original books, there are many, many nasty ends. Read it, try it, explore a few paths. This is the best…
