A bird's eye view of the vineyard
Lithuania Brings Out Payable Food Stamps, by Ruslan Ostashko Sun Nov 18, 2018 18:01 | Scott
Translated and captioned by Leo. Make sure to press CC for English captions. The malicious witch Zrada (defeat), who is circling, and not keeping the Russophobes out of sight from
Moveable Feast Cafe 2018/11/18 ? Open Thread Sun Nov 18, 2018 15:30 | Herb Swanson
2018/11/18 15:30:01Welcome to the ‘Moveable Feast Cafe’. The ‘Moveable Feast’ is an open thread where readers can post wide ranging observations, articles, rants, off topic and have animate discussions of
Nov. 16, 2018: U.S. Exposes Assad?s ?Evil Plan? To Hurl Middle East Into Chaos Fri Nov 16, 2018 15:40 | Scott
https://southfront.org/syri... On November 15, US Ambassador to Syria James Jeffrey exposed an evil plan of Syrian President Bashar al-Assad to create ISIS and to hurl the Middle East, particularly Syria
Prophetic! Solzhenitsyn?s Famous Harvard Speech Predicted Complete Collapse of American Society Thu Nov 15, 2018 17:18 | The Saker
House of Cards finale: #MeToo, sure, but women are just as bad as men Thu Nov 15, 2018 15:33 | The Saker
by Ramin Mazaheri for The Saker Blog (SPOILER ALERT! This article is not very good.) If House of Cards only had a first season and a final season it could
The Saker >>
A Blog About Human Rights
Human Rights Body In Africa Must Set A Better Example Wed Nov 14, 2018 16:13 | Human Rights
112 Pro-Biafra Imo Women Arrested Sat Aug 25, 2018 16:30 | Human Rights
Traveller Community in Galway Fri Aug 03, 2018 16:28 | Human Rights
US Withdraw From UN Human Rights Council Thu Jul 19, 2018 16:32 | Human Rights
Maldives Remain UK Priority Thu Jul 19, 2018 16:31 | Human Rights
Human Rights in Ireland >>
For lefties too stubborn to quit
And what of the British media?Despite the Border, the backstop and the DUP we?re not even there. 09:28 Sun Nov 18, 2018 | WorldbyStorm
Stupid statements from this weekend and the week? 09:10 Sun Nov 18, 2018 | guestposter
Speaking of polling: This will concentrate Tory minds? 06:09 Sun Nov 18, 2018 | WorldbyStorm
A new poll for mid-November! 01:03 Sun Nov 18, 2018 | WorldbyStorm
NOTICE/FÓGRA 15:49 Sat Nov 17, 2018 | guestposter
Cedar Lounge >>
Life should be full of strangeness, like a rich painting
Some Thoughts on the Brexit Joint Report 11:50 Sat Dec 09, 2017
IRISH COMMONWEALTH: TRADE UNIONS AND CIVIL SOCIETY IN THE 21ST CENTURY 14:06 Sat Nov 18, 2017
Notes for a Book on Money and the Irish State - The Marshall Aid Program 15:10 Sat Apr 02, 2016
The Financial Crisis:What Have We Learnt? 19:58 Sat Aug 29, 2015
Money in 35,000 Words or Less 21:34 Sat Aug 22, 2015
Dublin Opinion >>
People's News: Another housing bubble building!
Monday February 27, 2017 22:18 by 1 of Indyy
News Digest of the People’s Movement - No. 162 15 February 2017
The latest issue of People's News -for 15th Feb carries a lead article on the current housing bubble.
The free movement of capital has become one of the maxims of global capitalism. Along with the free movement of people, goods and services it is also one of the “four freedoms” of the EU’s single market.
But the removal of the policy instrument of capital controls has probably contributed to a succession of financial crises. Three decades ago, many people in the EU invested their hopes in a combination of free trade, free mobility of capital, a fixed exchange rate, and an independent monetary policy — dubbed an “inconsistent quartet.”
The combination is logically impossible. If Ireland, say, fixed its exchange rate to the German mark — which in effect it has done by adopting the euro — and if capital and goods move freely across borders, the Central Bank would have to follow the policies of the German central bank, the Bundesbank — or, in effect, the EU Central Bank in Frankfurt.
So we sacrificed monetary independence when we adopted the common currency. What has changed since then is the increasing importance of cross-border finance. Many emerging markets do not have a sufficiently strong financial infrastructure of their own. Companies and individuals therefore take out loans from foreign institutions denominated in euros; and that’s what the Irish banks were doing a decade ago.
Theoretically, it is the job of the Central Bank to bring the ensuing havoc to an end, which standard economic theory suggests it should be able to do so long as it follows a domestic inflation target. But if large parts of the economy are funded by foreign money, its room for manoeuvre is limited.
In the good times, credit flows into peripheral markets, fuelled by the massive German surplus, where it fuels local asset price bubbles, as we have experienced to our detriment. When, years later, liquidity dries up and the hot money returns to safe havens in Europe, the country is left in a mess.
Unless you accept financial instability as inevitable — and it increasingly seems an intrinsic part of the system as the time between crises grows shorter — you may soon be thinking about imposing capital controls that involve telling foreign investors that you don’t want their cash. The point is to prevent hot money flowing in during the good times and to stop it from draining out in the bad times.
This is not yet a subject of polite conversation among policy-makers. Central bankers have instead been peddling a concept known as macro-prudential regulation, a version of capital controls. The idea is to tweak incentives: when a housing bubble seems to be building up, the Central Bank imposes some ceiling on lending, for example by capping loan- to-value ratios. It might also ask its government to raise stamp duties or other transaction taxes.
Spain tried such measures during the precrisis years, and Ireland is trying it now. But it did not stop the buildup of one of the biggest housing bubbles in history.
More drastic action, such as leaving the euro or imposing controls on capital, might prevent the next calamity as rents and house prices soar. Spain did neither, but before long someone will — and it looks increasingly like it should be Ireland. Free movement of capital cannot be sustained as a point of principle when the economic costs are so devastating.
Some of the other articles in this issue are:
Two-speed EU back on the agenda!
Is there a trade war on the way?
Could the EU provide a solution to Ireland’s housing crisis?
EU banks have more than €1,000 billion in bad debt!
More euros to lend at low interest rates ?
The security industry is shaping EU legislation: lobbyists in action!
More austerity for the Greeks
What to do in Europe? Proposals from the left