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BlogBernanke’s 29 Trillion Dollar Fib Exposed
(cross posted at New Economic Perspectives) As I reported here and over at Great Leap Forward, a new study by two UMKC PhD students, Nicola Matthews and James Felkerson, provides the most comprehensive examination yet of the Fed’s bailout of Wall Street. They found that the true total cumulative amount lent and spent on asset [...] -
Blog
Credit Default Swaps: Banking on Failure
Micah Hauptman of Public Citizen has drawn from the work of the Levy Institute’s Marshall Auerback and Randall Wray to put together a concise piece that lays out five core critiques of credit default swaps. Among the basic problems he highlights is a flaw-riddled process for determining when a CDS pays off: … there are [...] -
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Projections of EU GDP
In our latest Strategic Analysis we estimate that a cut in the general government deficit in the United States would have strong adverse effects on unemployment and a relatively smaller impact on the U.S. public debt-to-GDP ratio, since GDP would slow down with a cut in government expenditures and transfers. A similar strategy of deficit [...] -
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$29 Trillion Bailout: Response to Critics
OK, anytime one criticizes the Fed or Wall Street there will be some push-back by the professionals who serve their masters. (By contrast, Barry Ritholtz understood the argument, see here.) My original piece on Friday got picked up by a number of blogs and generated a lot of hostile responses. I expect that. It is obvious [...] -
Working Paper No. 698$29,000,000,000,000: A Detailed Look at the Fed’s Bailout by Funding Facility and Recipient
There have been a number of estimates of the total amount of funding provided by the Federal Reserve to bail out the financial system. For example, Bloomberg recently claimed that the cumulative commitment by the Fed (this includes asset purchases plus lending) was $7.77 trillion. As part of the Ford Foundation project “A Research and […] -
Blog
The Shadow Banking System Is Slowly Imploding
Lessons from the bankruptcy of MF Global — the 8th largest in US history Yesterday, CEO Jon Corzine of MF Global appeared before the House Agricultural Committee. The hearing was a reminder that despite well intended legislation, including the Dodd-Frank Act, the speculative behaviors that brought down AIG and Lehman are still considered fair business [...] -
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The Fed’s $29 Trillion Bailout of Wall Street
UPDATE: to read the Working Paper (“$29,000,000,000,000: A Detailed Look at the Fed’s Bailout by Funding Facility and Recipient”) click here Since the global financial crisis began in 2007, Chairman Bernanke has striven to save Wall Street’s biggest banks while concealing his actions from Congress by a thick veil of secrecy. It literally took an [...] -
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The Crisis Behind the Crisis
In his latest installment, C. J. Polychroniou surveys the slow motion collapse of the eurozone and the ongoing fragility of the US economy, and insists that underneath it all lies a deeper crisis. What we are witnessing, he suggests, is not just the fallout from the latest banking panic or financial crisis, but a set [...] -
One-Pager No. 22A Crisis of Advanced Capitalism?
As the eurozone crisis continues, and while the US economy continues to muddle through, we need to reexamine what is actually going on, and sharpen our political-economy tools by considering that what may be taking place today in the advanced economies is not just a banking or a financial crisis but a broader crisis of […] -
One-Pager No. 22
Μια κρίση του προηγμένου καπιταλισμού;
Καθώς η κρίση στην ευρωζώνη συνεχίζεται, και ενώ η οικονομία των ΗΠΑ συνεχίζει να έχει τα χάλια της, θα πρέπει να επανεξετάσουμε τι πραγματικά συμβαίνει και να ακονίσουμε τα πολιτικοοικονομικά μας εργαλεία με το να λάβουμε υπόψη ότι αυτό που λαμβάνει μέρος σήμερα στις ανεπτυγμένες οικονομίες μπορεί να μην είναι απλά μια τραπεζική ή μια […] -
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Levy Institute Launches Greek Website
Policy coordination and information exchange are critical to resolving the eurozone crisis. With this in mind, the Levy Institute is making selected publications that address aspects of the crisis—including policy briefs, one-pagers, and working papers—available online in Greek translation. A list of our current titles is available at www.levyinstitute.org/greek/, and more will be added weekly. -
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ECB Inaction: Dogma and Rationality
As Dimitri Papadimitriou has said, the European Central Bank is one of the only institutions that can save the euro project. The commitment alone to making unlimited purchases of member-state debt might do the trick. But as we have seen, there is a lot of opposition to the ECB acting as lender of last resort. [...]