Archive for the ‘G20’ Category

Boring disaster looms

- June 3rd, 2013

The Bank for International Settlements, an international organization of central banks that has been around since 1930, just warned of a significant drop in cross-border lending in the West, driven by a sharp contraction in such lending in the Euro zone as lenders recoil from the wobbly finances of member governments. The BIS also warned against “monetary easing”, the magic money-printing stimulus being followed in most Western nations even though it’s not, um, working.

In a sentiment that should be easier to follow than it apparently is, BIS managing director Jaime Caruana said “If a medicine does not work as expected, it’s not necessarily because the dosage was too low.”

This sort of stuff rarely gets major headlines because monetary policy is obscure. But the BIS is a serious institution and when it warns that bad government finances in Europe are causing major capital market problems, and governments cranking up the printing presses isn’t a sensible response, people better listen before it turns into a highly technical but also very pointed “We told you so.”

As I was saying about free money

- April 1st, 2013

Former Reagan budget director David Stockman has a full-blown conniption in the New York Times about “quantitative easing” (a.k.a. “governments printing money like there’s no tomorrow”, as I observed in today’s Ottawa Sun) in the United States… and not without reason. If they keep it up, tomorrow’s going to be pretty grim when it arrives as dates on the calendar tend to do.

Money for nothing, risks for free

- March 22nd, 2013

There’s a really good, and really scary, piece in today’s Daily Telegraph by Spectator editor Fraser Nelson on the British government’s radical gamble that extremely loose monetary policy can do what people used to think extremely loose fiscal policy could do. But they were wrong the first time and probably are this time too. There really is no such thing as a free lunch, and if believing there is prevents you from getting food the old-fashioned way the end result is usually way too little to eat. Nelson argues that the policy of artificially depressing interest rates has huge costs that Britons have not even tried to debate. Which should worry Canadians too.

Read more…

Stop the wind farms, for peat’s sake

- February 25th, 2013

It’s not that easy being green, as Kermit the Frog rightly noted. For instance the Telegraph reports a new study, funded by Scotland’s very pro-wind-power SNP government, carried out by researchers trusted by environmentalists and previewed in the journal Nature (link here – but behind a paywall), finding that a typical British wind farm is built on a peat bog. And? And this: peat bogs are hugely important carbon sinks, Europe’s most important and on a par with rain forests. But only if they stay wet. And regrettably, the study says, when you drive roads through them, build large facilities and otherwise create wind farms, it tends to drain them, causing them to belch huge amounts of CO2.

Dang.

Canada should prepare for more worldwide turmoil, report warns

- February 20th, 2013

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An alarming new report warns the next year “could be even more troublesome” for Canada than 2012 in terms of global trouble spots and economic worries.

“The Middle East is in worse shape than at the beginning of the Arab Spring; Iran looms ever more ominously … North Korea threatens the U.S. with nuclear weapons; the tone between China and Japan and other players of the region over islands dotting the South and East China Seas has become harsher,” said the Conference of Defence Associations Institute (CDAI) in its latest strategic outlook. Read more…