Seed giants see gold in climate change
Monsanto, BASF and other developers of genetically modified crops are looking to patent changes in plants that help them survive better in the world's changing climate. But the crop developments may lead to higher bills for farmers as they become forced use a proprietary biotech platform. (May 14, '08)

THE MOGAMBO GURU
Chicken feed so far on
food prices
Inflation in prices, and you don't have to go much further than the local grocery store to know that it is already with us, generally follows inflation in the money supply. And given the rate at which that is climbing, those rising prices are going to go way, way higher. (May 14, '08)

Sears: From majesty to hedge-fund dust
The life and near death of one store charts the rise and decline of the American economy, from frontier innovation to the present crisis of overconsumption. The great US money-creation machine of the past few years has almost shut down. As the dust settles, we see that very little of real worth remains.- Julian Delasantellis (May 13, '08)

THE BEAR'S LAIR
Productivity's poisoned legacy
The Wall Street welcome to improved US labor productivity may be short-lived, with the prospects far less positive. Among other factors, capital will probably become more expensive in the years ahead, trade protectionism will intensify and more regulation will burden manufacturing. The next US president will not be responsible, but will take the blame. - Martin Hutchinson
(May 13, '08)

THE MOGAMBO GURU
'Unemployed' now a valid job description
Not only are close to a quarter of a million more people on the US government payroll than a year ago, the number on that payroll is more than the folk out there making real things - not even counting the thousands so utterly jobless they have signed up to government programs. And don't even think about that "hospitality" headcount. This is inflation hell!! (May 13, '08)

China's weakness the greater danger
Claims that China is an emerging superpower overlook the reality that the ineffectually governed country will struggle for decades to get and stay beyond subsistence. The West, rather than fearing China's expansion, should be preparing for a dramatic setback in Chinese economic growth and resulting breakdowns in domestic order.
(May 12, '08)

  THE MOGAMBO GURU
Stranger than fictional balance sheets
The US Federal Reserve is taking a whole lot of potentially dodgy assets from banks as security against Treasury bonds. So far so horrible. Now, Standard & Poor's has cut assumptions for how much will be recovered after defaults on some of those assets. So where does that leave the value of the Fed's "security"? Or put another way, how big is the hole in the Fed's balance sheet now? (May 12, '08)

MARKET RAP
Shadows lighten over Asia
The receding fear of an immediate downturn in the US has lightened the shadows over Asian markets. National issues such as inflation or the attraction of regional stocks to Chinese investors found room to assert themselves. Confidence, however, remains in short supply. (May 9, '08)
R M Cutler runs his eye over the ups and downs in the week's markets.

An oil-addicted ex-superpower
The United States' brief reign as the world's sole superpower is over, its status crumbling as surely as the unlamented Berlin Wall. Last month's NATO summit is merely recent evidence of the decline. America's utter addiction to oil, which once powered its climb to might, is its undoing, and an aid to Russia's resumption of power. - Michael T Klare (May 9, '08)

CHAN AKYA
Cyclone cowards fear
ultimate market
Curbs by cyclone-hit Myanmar on overseas help for its devastated population is merely an extreme example of a government cowering in fear of information. At a more prosaic level, Asian authorities concerned with improving their citizens' well-being should let markets with their abundance of information act in their favor. They should start with currencies, and then laugh all the way to the bank. (May 9, '08)

BOOK REVIEW
A new voice to Paine's cry of rebellion
Bad Money by Kevin Phillips
Four decades ago, author Phillips showed how a coalition of the new Sunbelt and the old white South would come to create a long-term Republican majority. Two decades is long-term enough for him, and he now declares rebellion against the entire American establishment controlling a near bankrupt country devoid of serious financial debate and civic engagement. - Joe Costello (May 9, '08)

THE MOGAMBO GURU
A nightmare of magic tricks
The US government's latest version of that great statistical trick called a deflator means we can fall asleep peacefully knowing that inflation is still less than 3% - and dream of where US banks magically and silently "disappear" US$49 billion and dream of why folk are buying Dow Industrial stock that won't pay back in seven decades. And ... aagh!! Wake up! Wake up!! (May 9, '08)

G7 loses grip on global policy
The world's seven leading economies until recently had the power to effect coherence to the policies of the great triumvirate of the international economic system - the World Trade Organization, the International Monetary Fund and the World Bank. No longer. Developing nations grouped as Outreach 5 have taken control and are not going to return it. (May 8, '08)

Fed wins space for more cuts
The US Federal Reserve was expected to call a halt to its series of interest rate cuts at its meeting next month, amid mounting concerns over inflation. But the latest productivity data give the Fed latitude to further reduce interest rates if economic conditions warrant. - Peter Morici
(May 8, '08)

THE MOGAMBO GURU
A fear of falling Fed credit
Increasing a country's money supply by raising debt is unwholesome, bizzare and utterly discredited, but that is how it works, which means that when total Fed credit stands still, as it has just done, that is worse than bizzare and incredibly unwholesome. The ramifications are terrifying. This is what is meant by "doomed". (May 8, '08)
 
The Fed's deformed maturity
The purportedly independent US Federal Reserve betrays its origins with its knee-jerk response to downturns from technology stocks to housing prices, its willingness to finance large fiscal deficits through low interest rates and its blindness to the impact of inflation and demands for economic justice. The US Congress and policymakers should remain indifferent no longer. - Hossein Askari and Noureddine Krichene
(May 7, '08)

The delusion of markets
Markets buoyed by the illusion that US GDP rose in the first quarter ignore the impact of years of stagnant workers' earnings and rising unemployment. A significant portion of the middle class is being squeezed - and their votes will count come the November presidential election. - Max Fraad Wolff (May 7, '08)

THE MOGAMBO GURU
Downsizing on the menu
The ghastly mess that is the US economy is giving consumers plenty to chew over - such as how producers mask inflationary horrors by cutting portion sizes while pushing up the cost-per-mouthful of your breakfast favorite. Even so, eat while you can before your local state government starts figuring out how to plug the gaping hole in its finances. (May 7, '08)

Fuel tax cut running on empty
US presidential candidates pledging to cut fuel taxes blithely ignore the fact they are not placed to make that happen. As bad, it is not what their country needs in response to rising prices. Worse, any such cuts would hit funding of transport infrastructure that already lags behind its counterparts in Asia. - Julian Delasantellis
(May 6, '08)

Food-crisis anger turns on UN bodies
The Food and Agriculture Organization of the United Nations is the latest pan-global organization established to ease poverty in the world's less-developed and largely rural economies to face bitter criticism as soaring prices of essential commodities expose a lack of preparation and investment in agriculture. (May 6, '08)

THE BEAR'S LAIR
Draining national prosperity
Relief engendered by the latest US GDP figures is misplaced, given recent monetary and fiscal inputs. Gradually increasing output and the optimistic stock market will sooner or later be confronted by consumer price figures. At that point, the US will suffer a monetary and political crisis. Awkwardly, that is more likely to occur before November's US presidential election. - Martin Hutchinson (May 6, '08)

THE MOGAMBO GURU
Massage for number crunchers
Few things beat a massage for making one feel better, especially if you're a politician or central banker with a bunch of numbers that would put you out of a job if the public saw their naked form. Unemployment? Give a squeeze here. Inflation? A dexterous bit of pressure will make it look less life-threatening. And for the really ugly bits, try some hedonic adjustment. (May 6, '08)

Speculators knock OPEC off oil-price perch
The bulk of price gains in oil is attributable not to supply problems but to speculative activity by hedge funds and others with no direct use for the fuel beyond profiting from its changing value. The door to much of this unregulated trade was opened by the US energy futures regulator under the George W Bush administration. - F William Engdahl (May 5, '08)

China faces trade war climate challenge
China's growing economy has brought the country to the center of the debate on curbing greenhouse gas emissions. Its reaction to moves by the US Congress to tax imports from other major greenhouse gas emitters could prove crucial in determining the most effective means of forcing international action on global warming.
(May 5, '08)

Gold price suppression scheme
How long the present relatively low price of gold will stay that way may depend on whether the US Federal Reserve has sold half the country's gold and if it is prepared to stop at half. At least that would give us the opportunity to buy more gold cheaply for a while longer yet.
(May 5, '08)

CHAN AKYA
Abandoning the USS Titanic
As the world comes to grips with declining United States power both in political and economic terms, it almost seems surreal that global media appear so keen to paper over the cracks. With even the corrupt and unctuous Gulf dictators rebelling against the US dollar, this is the beginning of the end. (May 2, '08)

MARKET RAP
Pacific remains pacified
Traders taking a break from their labors in Asia could do so reasonably satisfied with unfolding events. Once heady share-price declines appear to be halted with prospects of strengthening markets ahead. That apparent local stability may be welcome if the sense of panic returns to Wall Street. (May 2, '08)
R M Cutler runs his eye over the ups and downs in the week's markets.

Economic woes take US center stage
A major new survey finds that oil prices and other economic issues are edging out foreign policy concerns on the US public's worry list. Seventy percent of respondents say they worry "a lot" about soaring energy costs, and the survey's aptly named "Anxiety Indicator" shows that 84% worry about the way things are going for the US. - Jim Lobe (May 1, '08)

The twilight of irredeemable debt
Debts used to be considered obligations and issuance of irredeemable debt a crude form of fraud, facts ignored by courts and academics alike. But banks will eventually learn there is no way to rid the system of poisonous bad debt by creating more. - Antal E Fekete (May 1, '08)

COMMENT
Sanctions and rights - the odd couple
The use of trade sanctions to promote human rights is inconsistent - imposed on Cuba, not on China - and their value unproven. It is not known if enhanced protection boosts trade, or if increased trade leads governments to improve human rights. Yet the dearth of information has not stopped policymakers from wedding the two. (May 1, '08)

Fed may want inflation
US Federal Reserve chairman Ben Bernanke continues to cut interest rates, even as concerns grow at home and abroad at rising prices across swathes of the global economy. Despite public pronouncements to the contrary, it is possible the Fed chief sees more pros than cons for the US in the inflation he risks stoking. - Axel Merk (May 1, '08)

Bernanke takes one more gamble
United States Federal Reserve chairman Ben Bernanke's decision to cut key interest rates one more time was always in the cards. More astonishing was the scant concern he showed towards the inflationary risks inherent in his actions over the past few months, risks that food riots make clear are already a harsh reality in the world beyond the US. - Julian Delasantellis (May 1, '08)

   Fed cuts rate to 2.0 percent, keeps options open (AFP)

IMF spreads power a little wider
The poorer members of the International Monetary Fund, many still bridling from the terms of bailouts, including those imposed in the Asian financial crisis a decade ago, have secured themselves marginally stronger voting rights in the organization, against the wishes of Russia and Saudi Arabia. (Apr 30, '08)

Bernanke at personal crossroads
US Federal Reserve chairman Ben Bernanke, following a series of interest rate cuts to head off the credit crisis, stands at a critical career juncture. Should he now pursue genuine and widespread reforms or mere reappointment? Put another way, does he want a place in history alongside predecessor Paul Volcker or cheek by jowl with the unlamented Arthur Burns? - Peter Morici (Apr 30, '08)

At the center of a flood of debt
Look out any US window and the view is nothing but a sea of unpaid bills, with all that subprime mortgage panic a drop in the ocean of woes facing a low-IQ nation that thinks it can painlessly borrow and inflate its way out of any debt. It can't. And if you want to survive the threat of drowning like your neighbors, sell everything and buy that golden lifeboat. (Apr 30, '08)

THE BEAR'S LAIR
Oil in 2012: $200 or $50?
The US broad money supply by one measure has increased at an annual rate above 30% for most of this year. Maintained, that could triple prices within four years and oil would look moderate at US$200 a barrel, with gold hitting $2,000. Good sense by the US Fed and politicians might save the day, or a full-scale revolt by bond dealers. - Martin Hutchinson (Apr 29, '08)

What is really causing agflation?
Rising food prices, notably in the past year, have coincided with with increased involvement of speculators seeking to profit from rising demand for agricultural commodities. Specialists in the sector are divided over whether that speculation is itself driving up prices. (Apr 28, '08)

India, China hold G8 options
European leaders such as British Premier Gordon Brown and President Nikolas Sarkozy of France are pushing for India and China to sign up for full membership of the rich nations' club known as the Group of Eight. But their counterparts in New Delhi and Beijing have good reason to hold back. - Sreeram Chaulia (Apr 28, '08)

Big, bad, and the bill is rising
The idea that the US is suffering from some sort of credit crunch is now so familiar that it is almost banal. But banal it is not. The reduction in short-term commercial loans outstanding indicates that nothing less has happened than a rupture in the system. And the bill for fixing this is going to be big. Very, very big. (Apr 28, '08)

CHAN AKYA
Western excess is the Earth killer
The problem with people trying to save the world, as intended in this week's Earth Day, is that everyone has different living standards and objectives. What will benefit the environment is a reduction in excessive consumption by Europe and the US, not a reversal of Asian progress. (Apr 25, '08)

BOOK REVIEW
The Fed's king of bubbles
Greenspan's Bubbles - The Age of Ignorance at the Federal Reserve by William Fleckenstein
Alan Greenspan did not have to wait long before his reputation for guiding the US economy to a new age of economic prosperity was stripped of plausibility. The financial crisis now of global reach was underway well before his long tenure as US Federal Reserve chairman came to an end. The man's folly, and that of his obsequious inquisitors in Congress, is now fully exposed. - Julian Delasantellis (Apr 25, '08)

MARKET RAP
The calm before the storm?
China's reduction of a stock transaction tax energized a local market that was edging closer to a decline as precipitous as the 50% slide seen over the past six months. Survival of the optimism in Shanghai and elsewhere in Asia may depend on the US Federal Reserve's thoughts, to be aired next week.
R M Cutler runs his eye over the ups and downs in the week's markets (Apr 25, '08)

Funding the food price fiasco
Is there no end to the blithe ignorance, the sheer insanity, the blind arrogance of the powers that be when they wonder what to do with other people's money? Such as the International Monetary Fund "tackling" rising food prices by having donor economies give other people money to pay those higher prices! Duh! (Apr 25, '08)

The Democrats' free-trade divide
Executives within the US corporate elite, deterred by the George W Bush administration's international recklessness, will find many Democrats eager to return to Bill Clinton's pro-corporate vision for the global economy. But the broken promises of "free trade" pacts mean the majority of Americans have reason to cry foul at such deals and to demand a truly democratic economic agenda. - Mark Engler (Apr 24, '08)

The great silence of a Gilded Age
We live in a Gilded Age, in which bankers and fund managers pocket billions of dollars, echoing a similar period of growing wealth in the 19th century. Yet few protest at income inequalities not seen in the US since before the Great Depression. That may change, and the great silence of the second Gilded Age may give way to the great noise of the first. - Steve Fraser (Apr 24, '08)

Engine and wagon
The growth of multinational US corporations, to the point where revenues of the top 10 match almost 15% of the country's gross domestic product, has coincided with an increased separation of their interests from those of the US. As the world heads for a period of painful change, a better understanding of what drives that change is essential. - Max Fraad Wolff (Apr 24, '08)

Bear market leaves short options
The air of gloom that has overhung the world's stock markets this year shows little sign of disappearing, leaving many investors in index mutual funds desperate for a turn in their fortunes. Yet exchange-traded vehicles tied to Asian and Western businesses and currencies offer an alternative route to profits even while the bears rule the market. - Julian Delasantellis

Greenspan's legacy vs Volcker's demarche
Former US Federal Reserve chairman Alan Greenspan's reputation is increasingly shredded amid the continuing global financial crisis, while that of predecessor Paul Volcker has seldom looked better earned. The sooner the Fed returns to Volcker's approach, the sooner financial confidence will be restored. - Hossein Askari and Noureddine Krichene (Apr 23, '08)

SPEAKING FREELY
Bank of England misses the point
The Bank of England, with its near US$100 billion loan facility for banks and mortgage providers, may briefly ease Britain's credit crisis. Yet like the US Federal Reserve previously, the central bank has shown by its actions a failure to deal with the fundamental structural problems within contemporary financial conglomerates. - Peter Morici (Apr 22, '08)

BEAR'S LAIR
The rising protectionist tide
The rising rice price confirms that the world has moved decisively towards protectionism. Globalization in its extreme form has failed, yet revival of the Doha round of trade talks and the end to the pernicious growth of bilateral trade deals could help the rich West ensure maximum protection of its living standards at the minimum possible global economic cost. - Martin Hutchinson (Apr 22, '08)

Disproportionate derivatives
The idea that the financial world, built on crumbling stacks of derivatives piled high to the tune of US$700 trillion, could replace its foundations with real stuff like gold is a non-starter, given how the porcine US Congress gets fat on the present setup. But something horrible is happening, and the lifeboat is shiny, metallic and definitely yellow. (Apr 22, '08)

Just staying alive
The slight coverage of recent US government market interventions seems to ignore the implications, concluding that the markets will chug along indefinitely. That is reminiscent of the attitude of people living immediately under a dam who profess unconcern at the risk it might burst - it is the only way they can preserve their sanity. - Doug Wakefield (Apr 21, '08) 

SPENGLER
Rice, death and the dollar
For developing countries whose currencies track the US dollar and whose purchasing power declines along with the American unit, catastrophe looms. So China, for example, is exchanging its depreciating reserves of the greenback for things of value, notably rice, with frightening consequences for dependent countries and deadly consequences for American foreign policy. (Apr 21, '08)

CHAN AKYA
Bankrupt policies,
empty stomachs
Inflation in food products has become the new front in the geopolitical battlefield. Asians can start by blaming themselves for the present mess in which their farmers remain poor, their poorest struggle to pay for basics such as rice, and their governments continue to pay economic allegiance to the has-been powers of America and Europe. (Apr 18, '08)

Forest values rise with warming
Increased awareness of the role deforestation is playing in global warning - the second major source after fossil fuel consumption - is turning minds to assigning values to forests. Investors are getting into conservation and sustainable harvesting with premium products as part of the solution. - Evan O'Neil (Apr 17, '08)

Fed fails to learn inflation lesson
The US Federal Reserve's policy of further cutting interest rates and injecting liquidity when inflation is already fully established is increasing the vulnerability of the financial system. Reducing the money supply and renouncing interest rate controls are the only effective solutions to runaway price rises and a falling dollar. - Hossein Askari and Noureddine Krichene (Apr 17, '08)

The rise of the new energy world order
This is the beginning of the final stage - and age - of petro power, geopolitically speaking. A new world order is emerging that will be characterized by fierce international competition for dwindling stocks of oil, natural gas, coal and uranium, as well as by a tidal shift in power and wealth from energy-deficit states like China, Japan and the United States to energy-surplus states like Russia, Saudi Arabia and Venezuela. The order will dictate what businesses people engage in; and under what circumstances states go to war or avoid foreign entanglements that could end in war. - Michael T Klare (Apr 16, '08)

US power failure a 'dismal' turning point
The failure of neo-liberalism to develop a sound and sustainable US economy is now self-evident. The way forward requires rejection of the notion of economics as a science; it is a cultural system. The political then has to be put back into the economy. - Joe Costello (Apr 16, '08)

McCain confirms US ideological bankruptcy
United States presidential candidate John McCain's proposed economic program confirms the absence from both Republican and Democrat parties of realistic ideas to put the economy back on a sound footing. - Peter Morici (Apr 16, '08)

Asia's rise helps drive logos into shade
The dot.com-era battle for control of Internet domain names has receded from the public eye, but the value of catchy cyber-space addresses remains high. The increased Internet presence of Asian companies ensures that address identity will continue to push aside logo awareness as a key selling point. (Apr 16, '08)

Melting a Grammy for gold
Anyone who still thinks these are normal times is either on holiday outside the solar system or hasn't opened their mail recently. Things are so abnormal that amid the worst crisis since the Great Depression, US stocks are priced way above normal when they should be way below normal. It's time for some heavy metal lyrics; better still, make that precious metal music. (Apr 16, '08)

Crisis? What crisis?
Wealthy Americans with little blue pills, fast cars and hippie chicks know life is still good amid the worst financial mess since the Great Depression. Their cash still helps private equity groups do funny-money deals with the likes of Citigroup, raising cheers among the commentariat. But if you think that means the crisis is over, think again. - Julian Delasantellis (Apr 15, '08)

THE BEAR'S LAIR
The degradation of accounting
The folly of fair value accounting, which helped to drive up executive bonuses based on illusory values, is increasingly exposed by the US financial crisis. Goldman Sachs now has "assets" for which no market exists valued at twice the firm's capital. That route leads to insolvency. Martin Hutchinson (Apr 15, '08)

A blow for Asian wealth funds
Germany's decision to introduce controls on investments in the country by sovereign wealth funds, mostly based in Asia and the Middle East, indicates a victory for European protectionists and a stand against the globalization so recently pressed for by advanced economies. (Apr 15, '08)

Washington lobbyists spend a record
Power attracts money as never before in the United States, with companies, governments, labor unions and other parties spending a record amount last year to influence Congress. Health interests led the way in an environment in which multimillion-dollar contracts are won for a mere US$100,000 worth of lobbying. (Apr 15, '08)

The capture of Keynesianism
The United States central bank and government have wrapped themselves in the cloak of John Maynard Keynes as they attempt to claw their way out of the present financial mess - but only after helping to obliterate the structural policies that are an essential element of Keynesian economics. - Thomas I Palley (Apr 14, '08)

World Bank burns credibility
The World Bank plans to increase the size of two funds aimed at helping countries change to "low carbon" economies. Yet, even as the bank takes its "cut" from similar trust funds, it finances coal, oil and gas projects to the tune of US$1.5 billion. And why not, it says. It's not your money. (Apr 14, '08)

Dollar can be saved from self-mutilation
The US dollar has been continuously debased for three decades, despite the damage this was doing to America's industrial capital. Such self-mutilation is not irreversible. But it calls for discipline, a cutback on wasteful consumption, savings, and, above all, monetary leadership. - Antal E Fekete (Apr 10, '08)

Capitalism at stake in climate crisis
As recognition grows of the threat posed to humanity by global warming, the goal must be adoption of a low-consumption, low-growth economic model. Yet the elites of the North and the South are likely to agree only to techno-fixes and a market-based cap-and-trade system. Growth will be sacrosanct, as will the system of global capitalism. - Walden Bello (Apr 10, '08)

Pain amid Asia's positive growth outlook
China and India look placed to maintain solid growth momentum as the United States slides into recession this year, according to the International Monetary Fund and the World Bank. Yet the world's poorest will feel the pain as foreign aid declines from rich countries feeling the pinch. (Apr 10, '08)

The Black Death of financial collapse
The US subprime mortgage disease that has now infected the whole global economy is the consequence of failing to be eternally vigilant against the chicaneries of Wall Street and the damage these can cause to Main Street. The world, from Iceland to New Zealand, is ill-prepared for the events now unfolding. James Cumes looks at Australia's part of the global picture.(Apr 9, '08)

CHAN AKYA
Asia must rally behind China
Asian countries must rally behind China ahead of the Olympics as Group of Seven countries and their lackeys aim to increase their shrill rhetoric at their meeting this weekend. Using a combination of diplomatic and economic moves to trip the Americans, the region could gain the upper hand for the long term. (Apr 9, '08) 

Bankrupt approach to judgement day
United States bankruptcy judges can alter terms between parties in corporate law and of contracts involved in defaults on second homes, yachts and investment properties. But things are not so easy for subprime losers, and it will stay that way thanks to implacable Republican opposition. - Julian Delasantellis (Apr 8, '08)

Pain relief needed
As the United States slides into recession, the government reaction has been largely limited to helping firms that led the country down the slippery path - big investors and banks. What is missing are macro-economic measures that recognize and alleviate the pain of those suffering the most. Earnings have to be raised and debt levels cut. - Max Fraad Wolff (Apr 8, '08)

THE BEAR'S LAIR
The de-flattening of the world
Globalization never did quite flatten the world, as Thomas L Friedman argued, although Western workers have learned it can hurt pay and job security. Big bumps remain and are growing, as economies damage their own interests with numerous new barriers - from export restrictions and agriculture subsidies to immigration controls and Internet censorship. - Martin Hutchinson (Apr 8, '08)

Strong yuan may be China's savior
Chinese writers and economists rarely share the United States perspective that the yuan should appreciate faster to ease the trade deficit between the two countries. Conspiracy theorists have popular support. Yet a major appreciation of the yuan could be the most effective way of bringing China's inflation under control. (Apr 7, '08)

Demythologizing central bankers
The exalted status of the world's central bankers, bloated by self-congratulation and the economic boom of the past 25 years, is scheduled for demotion as demands grow for a return to true full employment with diminished income inequality. How we tell history really does matter. - Thomas I Palley (Apr 7, '08)

CHAN AKYA
A conspiracy against gold
The global conspiracy against gold has been gathering steam, with central banks rallying around the US Federal Reserve to prevent a full-scale economic collapse. This will succeed over the near term, but as the US runs out of things to sell, so will the latest bout of risk-taking in global markets. (Apr 2, '08)

SPEAKING FREELY
Peak credit and a flight to simplicity
The financial seizure arising from the US subprime mortgage crisis arose as banks outsourced through derivatives and other tools the one thing of economic value they provide - a guarantee to depositors that the credit of borrowers is good. Simpler asset-based property finance is now required, with Hong Kong already half way there. - Chris Cook (Apr 2, '08)

The Fed and the stagflation specter
For much of the past decade, the US Federal Reserve has defiantly followed an aggressive expansionary policy by reducing interest rates and disregarding credit risks. There is now no alternative to choking off inflation. Merely carrying on with the present stance will aggravate the crisis. - Hossein Askari and Noureddine Krichene(Apr 2, '08)

A risk-free revolution
The US Federal Reserve-led rescue of Bear Stearns was a blatant example of moral hazard being rewarded. The US financial system, thought to be exemplified by rough and ready individualists and free marketers, now gleefully accepts the greatest government intervention in the financial markets in at least 70 years. One question - what comes next in this new risk-free model? - Julian Delasantellis (Apr 1, '08)

THE SHAPE OF US POPULISM, Part 4
A panic-stricken Federal Reserve
The recent moves by the US Federal Reserve, amid fears of an economic depression, to inject liquidity into the credit market and to bail out banks and brokerage houses are looking more like fixes for drug addicts in advanced stages of abuse. But for neo-liberal market fundamentalists, the fear is not of an economic depression, but the populism that may follow it. - Henry C K Liu (Apr 1, '08)
 Part 1: A rich free-market legacy - for some

 Part 2: Long-term effects of the Civil War

 Part 3: The progressive era

THE BEAR'S LAIR
Only the money is cheap
When money is excessively cheap, only the money is cheap. Everything else from assets to business ethics becomes horrendously expensive or unobtainable. We can only hope the next US president will appoint a Fed chairman who believes in sound money before we endure a decade of wasted resources and severe recession.- Martin Hutchinson (Apr 1, '08)

FDR's dream comes true as nightmare
As some people celebrate the advent of US$1,000 gold, they risk forgetting that it is a milestone in the fulfillment, 75 years on, of president Franklin Delano Roosevelt's design to deprive people of the liberty to shelter the fruits of their labor from the claws of the government. At present prices, few can buy gold to protect their fruits. - Antal E Fekete (Mar 31, '08)

The little administration that couldn't
The George W Bush administration's well-established record of incompetence and association with destruction - from Iraq and Afghanistan and back to hurricane-hit New Orleans - are fair pointers to whether it can end the US financial crisis. The people in charge have done little these past years but hand money to the rich and run American power into the dirt. - Tom Engelhardt (Mar 28, '08)

CHAN AKYA
The new Brahmins
Socializing risk and privatizing profit points to a global economic gridlock that will likely make Asia's poor even poorer. The elite of global banking can rest assured that society will pay its toll in perpetuity, essentially creating a new super-caste of bankers. It's not Asia that is being globalized, it is the West that is absorbing the worst Asian habits. (Mar 28, '08)

What's up with Asian currencies?
The strength of the yen and euro has been a dominant recent feature of global markets. Yet Asian currencies, even the Chinese yuan, have yet to show comparable gains against the US dollar. Economic fundamentals argue that these gains should come; local politics can argue otherwise. Therein lie the risks and the opportunities. - Axel Merk (Mar 27, '08)

Markets' weak spot is bad ad vice
Capitalism "discovers" wants that people did not realize they had - and is sustained by conversion of greed and envy into virtues. As globalization and wage inequalities become ever more evident and the US economic model appears in disarray, a solution is not to abolish markets but to remoralize wants. The simplest way of doing this is to restrict advertising and create room for other motives to fourish. - Robert Skidelsky (Mar 27, '08)

THE BEAR'S LAIR
Wall St greed to feel the squeeze
The present unwinding of the US financial system, with serious and repeated losses still to come, will lead to fundamental change in the regulatory environment. Even as some new rules will prove as counterproductive as those they replace, the altered Wall Street that will emerge will be less exciting for the greedy - providing one of the few unequivocal benefits of the miserable recession ahead. - Martin Hutchinson (Mar 26, '08)

SPEAKING FREELY
China risks caution overkill
after Bear prudence
CITIC Group's decision to cancel its US$2 billion cross-shareholding deal with Bear Stearns highlights China's new mood of caution on investing in Western banks and may coincide with a rethink regarding its own financial organizations. Yet a return by China to the world of rigid financial sector compartmentalization would be in neither its own nor the global financial system's interests. - Sebastian F Bruck (Mar 25, '08)

Medvedev holds key to WTO
Dmitry Medvedev's ascension to power in Russia heralds a new opportunity for resolution of differences that bar the way to the country joining the World Trade Organization. Yet even if membership remains elusive, internal debate on the issues involved has proved an innovative experience. - Kaveh L Afrasiabi and Natalia Gold (Mar 20, '08)

Why Spitzer was Bushwhacked
Disgraced New York State governor Eliot Spitzer had cause to feel frisky when he visited Washington in February. As he was paying off a call girl, the press was preparing to run a Spitzer broadside against the world's biggest financial powers and President George W Bush, whom he described as a fugitive from justice and a partner in crime with predator lenders. It was a politically fatal coincidence. - F William Engdahl (Mar 19, '08)

Bernanke running out of bliss space
US Federal Reserve chief Ben Bernanke and his pack of merry pranksters, having given Wall Street yet more interest rate cuts, now have only a few months before they must conjure up other tricks to end the rot in the US economy as rate levels head near their floor and inflation concerns mount. - Julian Delasantellis (Mar 19, '08)

An inflation reality check
With US monetary policy setting the pace for inflation in as much as 60% of the global economy, unconcerned central bankers - and investors - should hold their next meeting in Zimbabwe; other destinations from Vietnam to Venezuela also offer evidence of the damage uncontrolled price rises can cause. And this is not going to stop in the near future, abroad or at home (Mar 19, '08)

Preventing a financial crash
The Federal Reserve has still much to do if it is to pull the US back from the financial brink. Expanding the range of institutions it deals with would be one step, reflecting the reality that lending is increasingly separated from banks. Increasing the categories of securities it accepts as collateral would be another. - Thomas I Palley (Mar 18, '08)

THE BEAR'S LAIR
Sorry, I wasn't pessimistic enough
Early forecasts of declines in US house prices and of mortgage bad-debt losses have fallen far short of the mark and a far grimmer picture is developing. Losses to come are probably large enough to wipe out the banking system and failure of any one major house could be sufficient to bring down the world economy. - Martin Hutchinson (Mar 18, '08)

CHAN AKYA
Trust goes down the drain
The acquisition of Bear Stearns by JPMorgan Chase at a knock-down price of $2 per share means investors cannot trust the reported book value of US financial firms any more. And if they cannot trust investment banks, can the trust of commercial banks be really all that higher? The Fed and other central banks should now understand that the bailers themselves may need to be bailed out in time. (Mar 17, '08)

CHAN AKYA
Forget Spitzer, fire Bernanke
While the New York governor resigned for what was essentially a private matter, the world's central bankers cause greater damage and have proven less accountable for their actions. Continued debasement of fiat currencies leaves the financial system unhinged and more prone to collapse. (Mar 14, '08)

Heat turns up on market ideology
The threat climate change poses to humanity demonstrates a failure of market mechanisms on a vast scale. Government intervention and prioritization of environmental measures over market ideology is now required. The European Commission president's recent warning that trade must be subordinated to ecological objectives is progress - even if the US takes an opposing stance. (Mar 13, '08)

Bad oil news here to stay
This month's record oil price triggered memories of the last comparable high nearly three decades ago. This time it is different - high prices are here to stay, and March 3 may become recognized as the moment energy costs became the decisive factor in the balance of global economic power.- Michael T Klare (Mar 12, '08)

Save the market from market forces
The painful sounds emanating from the West's imploding financial structures are more than just the creak of seized up gearing and groans of impoverished shareholders. They include the death sighs of neo-liberal deregulation and calls for improved control of the banks and other institutions that have brought about the current chaos.  (Mar 12, '08) 

THE BEAR'S LAIR
The unequal impact of war
War can appear an attractive option to failed authoritarian states that can fund violence through ownership of natural resources that pull in foreign exchange income. An assault on hard-working neighbors with finely-tuned economies can appear particularly attractive. Only a few such aggressors are around - bringing down the price of oil would limit even their threat. - Martin Hutchinson (Mar 11, '08)

Bush family touched by subprime crisis
The subprime financial crisis, which started with low-skilled workers in the US struggling to come up with their mortgage payments, has now worked itself through the country's ranks to lap at the country's elite - including the family of former president George H W Bush. - F William Engdahl (Mar 11, '08)

Why Boeing lost the $40bn tanker deal
Boeing is still smarting after losing out on a US$40 billion US government contract to build a new aerial refueling tanker jet, believing it had a more cost-effective product. But that's not the point. The tankers are not just big flying bladders of fuel. They are a critical component of the George W Bush and neo-conservative foreign policy of being able to bomb any country, any time. Crucially, then, the winning design by Northrup-Grumman and the European EADS aerospace consortium has a fuel cargo capacity almost 25% greater than Boeing's. - Julian Delasantellis (Mar 10, '08)

US can fast exit from bad times
The prolonged downturn in the Japanese economy that followed its 1990s' real estate boom hangs like a specter over the US in its post-housing bubble mess. Yet there is reason to believe that the US, though as liable as any country to hubris, greed, mistakes and misunderstanding, will more quickly pull out of its present quandary. (Mar 10, '08)

Euro-trash
Europe's leaders are too busy destroying their economies to notice the grand opportunity to assume global leadership. The European Central Bank is also far from being the paragon of virtue that many economists consider it. A failure to grasp this dynamic means that the rise of the euro against the US dollar will be in vain. (Mar 10, '08)

Why the dollar is so cheap
When George W Bush was inaugurated in 2001, the euro was trading at 94 cents and gold cost $266 an ounce. Now they are trading at $1.52 and $985 an ounce. That is a plain vote of no confidence in the government's economic model, and international investors are fleeing the dollar for the best available substitute - the euro and gold. - Peter Morici (Mar 6, '08)

THE SUBPRIME ICEBERG
A year later, the band plays on
A year after the subprime crisis came to public attention, the rot in the financial system continues to spread, leaving the Fed with at least one very important question to answer - should it come directly to the rescue? As the US central bank and other actors dance the subprime twostep, the tune is reminiscent of the music on the Titanic as the lifeboats sailed away. - Julian Delasantellis  (Mar 5, '08)

THE BEAR'S LAIR
Regulating the un-regulatable
The US securities markets collapse and Northern Rock's demise in the United Kingdom highlight the failure of present finance regulation. Bankers, by nature greedy, will use any loopholes to enrich themselves. Regulations should therefore be draconian and without loopholes, and 30 years' "innovation" should be abandoned. - Martin Huchinson (Mar 4, '08)

CHAN AKYA
Dead dollar sketch
The demise of the world's reserve currency reads like a financial version of the infamous Monty Python Dead Parrot sketch. The arguments of US dollar supporters appear increasingly hollow. The implications are much more geopolitical than merely economic. (Mar 3, '08)