The New York Times seems to think Ireland is a candidate to default just like Dubai. The Irish government may want Irish commentators to ‘wear the green jersey’ and do the economic analysis equivalnent of smiling and nodding – but then those pesky Americans go and mention the unmentionable.
Bertie Ahern wondered in 2007 why critics of government economic policy didn’t commit suicide. Now he thinks they should do something productive like ‘dig the garden or grow bluebells’. The comments were made to VIP magazine.
Here a link to an op-ed piece I did for this week’s Farmers Journal on Credit Problems and the Japanese Experience in case anybody is interested. The key lesson from Japan, in my opinion, is that low interest rates and fiscal expansion do not work in the absence of a well capitalised banking sector.
Colleague Eoin O’Leary has a fine article in the Irish Times today, which presents a sobering analysis of the repeated mistakes of Irish governments due to blocks in thinking. The thinking behind policy-making presented is certainly what Thomas Sowell would refer to as a “vision of the anointed”. One is reminded of the sub-title of [...]
N Gregory Mankiw has an interesting suggestion on how rates can be cut below zero. With a negative nominal rate the problem is that people will keep cash as a zero return (on cash) is better than a negative return. His suggestion (credited to a graduate student) is that the government announces that in one [...]
It may not be much comfort to those who have lost on bank shares recently, but in a recent (February 27) letter to shareholders in Berkshire Hathaway, Warren Buffet indicated that the investment company lost a significant amount of money on Irish banks. He says that in 2008 he invested approximately a quarter of a billion dollars [...]
There was mention on Morning Ireland this morning of a putative insurance scheme for Irish banks. Matt Cooper presents a spirited defence of the move in yesterday’s Sunday Times. He describes the proposal as being promoted by the institutions themselves. The outline he presents is the recapitalised banks would take the hit for about 20% [...]