New Economic Perspectives

William K. Black February 7, 2016     Bloomington, MN The New York Times has produced a wonderful, unintended, juxtaposition in their pages on February 6, 2016.  Two articles report on think tanks calling for the government to engage in right-wing propaganda campaigns to restore “manly” men.  One article discusses the Chinese think tanks that have convinced the (Communist) government to engage in a massive propaganda campaign. Worried that a shortage of male teachers has produced a...

By Eric Tymoigne Previous posts studied the balance sheet of the fed, definitions and relation to the balance sheet of the fed, and monetary-policy implementation. In this post, I will answer some FAQs about monetary policy and central banking. Each of them can be read independently. Q1: Does the Fed target/control/set the quantity of reserves and the quantity of money? The Fed does not set the quantity of reserves and does not control the money supply (M1). It sets the cost of reserves;...

By Geoffrey Gardiner Jurists have demonstrated that every right must have a corresponding duty, or it is worthless. The same is true of financial assets: for every creditor there has to be a debtor. Money is assignable debt. The debt should be negotiable, that is it can be transferred to another owner without reference to the knowledge of the debtor. There are primary debt and secondary debt. An example of primary debt is when a borrower draws down a bank loan by making a payment to...

Bill Black explains why one of world’s largest investment firms Goldman Sachs is questioning the “efficacy of capitalism” and why its CEO is terrified of a Sanders presidency. You can view it here on the Real News (include transcript). [Translate]

William K. Black February 4, 2016     Bloomington, MN Former Secretary of State Hillary Clinton, in her debate with Senator Sanders minutes ago, said that she went to Wall Street and told them to stop their “shenanigans.”  The context was that she was being asked to respond to the complaint that she was too close to on Wall Street billionaires.  She had every incentive, therefore, to demonstrate how tough she would be on Wall Street.  In that context, the best she could muster was the...

William K. Black February 4, 2016     Bloomington, MN This is the fourth part of my series on the lies about “liar’s” loans that suffuse the Wall Street Journal article reporting that “big money managers” want to bring back “liar’s loans.”  This part focuses on the fact, which the WSJ treated as so obviously reasonable that it was unworthy of analysis, that: Money managers want to bankroll the loans while relying on the mortgage firms to handle the process with borrowers, basically acting...

NEP’s Bill Black and Roosevelt Institute Fellow Mike Konczal take on the policies of the two contenders for the Democratic nomination in this appearance of The Real News. Getting the message out about Bank Whistleblowers United! You can view here (includes transcript). [Translate]

Below are links to a couple of reviews of Randy Wray’s latest book – Why Minsky Matters: An introduction to the work of a maverick economist. What Would Minsky Do Now? A review by Laurence B. Siegel at ValueWalk A review by William J. Bernstein for CFA Pubs. [Translate]

The Quest for Better Bankers, Better Banks Requires Better Economists Review by William K. Black [This review originally appeared in Concurring Opinions] In Better Bankers, Better Banks, Claire Hill and Richard Painter of the University of Minnesota Law School signal their approach in the subtitle:  “Promoting Good Business through Contractual Commitment.”  This review explains why their thesis is so timely in terms of the most important theoretical debates boiling in economics and banking...

William K. Black February 3, 2016      Bloomington, MN This is the third column in my series about the Wall Street Journal report that “big money managers” want to bring back “liar’s loans.”  Here are the article’s first two sentences. Wall Street wants to bring back the “low-doc” loan. These mortgages, which are given to borrowers that can’t fully document their income, helped fuel a tidal wave of defaults during the housing crisis and subsequently fell out of favor. The second sentence...