Friday was the 25th anniversary of Black Monday, October 19 1987, when the Dow Jones Industrial Average fell 508 points, or 22.6%, the S&P 500 Index fell 20.5% while the Nasdaq index (which few people followed in those pre-dotcom days) fell 11.4%. It was a worse one-day fall than in 1929, and was generally expected […]

Mitt Romney in a speech at Virginia Military Institute October 8, said there was a “longing” for American leadership in the Middle East and laid out a foreign policy agenda that differed little from that of George W. Bush. As such a policy would more or less remove any possible savings from budget economy, leading […]

Robert Gordon, of Northwestern University, has aroused fear among conventional commentators by his paper (NBER Working Paper 18315) suggesting that U.S. economic growth has begun to slow inexorably, and that it will cease altogether, slowing to the sluggish levels prevailing before the Industrial Revolution, by 2100. To some extent, these arguments are familiar, having appeared […]

No less an authority than Goldman Sachs CEO Lloyd Blankfein said at the Clinton Global Initiative last week that the United States could risk its status as the world’s reserve currency if Congress fails to act and the “fiscal cliff” program of spending cuts and tax increases is enacted January 1. Actually Blankfein’s statement was […]

Henry St. John, Viscount Bolingbroke (1678-1751) was a leading minister in the Tory government of 1710-14, prime minister for four days at its end, then after the Hanoverian succession spent the rest of his life mostly under attainder and moving between opposition, journalism and exile. At the end of his life, disgusted with political developments […]

Austrian economists’ explanation of the 2007-08 financial crisis, that it resulted from a mountain of “malinvestment” in housing and the debt related thereto, in the United States, Britain, Spain and several other countries, is now generally accepted as correct. Unfortunately the actions, monetary, fiscal and regulatory, taken to resolve that crisis have had the effect […]

I discussed last week how Ben Bernanke’s easy-money policies could be reversed, should Mitt Romney win the Presidency and wish to reverse them. It is only fair, therefore, to discuss the other possibility: should Barack Obama be re-elected and (ignoring his fiscal and regulatory policies, which in any case would be modified by Congress) allow […]

Mitt Romney has now said he would not reappoint Ben Bernanke as chairman of the Fed. What a relief! (Or maybe not; I still reckon Obama has a 50-50 chance of winning in November, and he will now presumably get Bernanke’s help, including a dose of QEIII at either the September or October Fed meetings, […]

Last week’s revelation in the Fed minutes for its August 1 meeting that another “QEIII” government bond purchase is almost inevitable has intensified the recent upward trend in markets. With fiscal and monetary policies more extreme than any in history, now entering their fifth year, and equally unprecedented advances in communication in computing enabling ever-faster […]

When even the strongly Europhile Economist (August 11th – 17th, pp 19-22) publishes a lengthy piece on how the euro might break up, the question must be worth addressing again. For one thing, we should think about how many pieces the euro Humpty Dumpty egg might form when it hits the ground, and what future […]