It’s not because they lent money to a developing country that went under. It was because they bought Treasury bonds. Why did they have such huge imbalances? Partly because the CEOs of those banks believed the promises of the various monetary authoritiesthat rates would be low forever. And ...
Dominique Lyone graduated from this program in 1992. In his words: "I was effectively going broke but struggling to see a way through it... Since the moment I walked out those doors on that Sunday night some 27 years ago, I turned the business around. Each year I have delivered a bett...
and in 1844 Sir Robert Peel’s government concentrated all note issuing with the Bank of England, allowing its Issue Department to produce £14 million of fiduciary money—that is, notes that were not convertible—and after that a one-for-one note issue against its varying gold reserves. Th...
Some central banks occasionally use a form of auction to choose the rate at which funds are lent to the market. This is known as a floating or variable policy rate, but even when this is used the central bank sometimes determines the outcome in advance by specifying that bids below a ...
created a permanent record in 1942 when at 47, he obtained a SSN for purposes of working for The Hannan Company. Until that time, none of the three Kryders had taxpayer numbers as their federal investments were government guaranteed to the registrant tax-free interest and principal until death...
government lent to the two mortgage entities. Prior to the capital injection, Fannie Mae and Freddie Mac had negative net worth, meaning that Treasury’s aid only brought them to zero. But, as the report reads, all of the profits the two make now represent therefore the return on the ...
Just consider what might happen if mortgage holders realised the money the bank lent them is not, really, the life savings of some thrifty pensioner, but something the bank just whisked into existence through its possession of a magic wand which we, the public, handed over to it. ...
I am pleased that Greg Mankiw has recently given the interest penalty on reserves idea more visibility. (It is also nice to be called a “prominent economist” by Mankiw.) Unfortunately, like the rings of Saturn, this issue is much more complicated than it appears at first glance. Many eco...
Debts that can no longer be repaid. Now what is really bizarre is that the money we collectively owe did not exist before it was lent out and the amount we collectively owe exceeds the amount of money available to pay those debts. The system bears remarkable similarities to a Ponzi or ...
I quite agree with you that there is a strong need that we should find soon a scheme to better our position; but at present I can think of none; and as for taking another turn on the shore yonder, why, that I flatly refuse to think about. I have no appetite for plunging14 about ...