Subscribe to Dollars & Sense magazine. Recent articles related to the financial crisis. Revisiting Bretton Woods (Literally!)Want to taste the same four-course meal that John Maynard Keynes enjoyed?You can mark the 65th anniversary of the Bretton Woods International Monetary Conference at the place where it all began, as The Mount Washington Resort is celebrating its own place in history next weekend. The upscale hotel in the White Mountains of New Hampshire will "celebrate the historic occasion by offering guests interested in exploring our world economic history [sic]." Sponsored by New Hampshire's statewide Chamber of Commerce, the weekend is aptly titled "The Gold Standard Package." Rates start at $194.40 per person, double occupancy. Guests will spend Saturday, July 25, listening to the sober analyses of mainstream economists, including the official historian of the IMF. The festivities begin on Saturday morning with a treasure hunt, called the Gold Rush (no, we're not making this up). Here's their description: On Saturday night, you can enjoy a "commemorative dinner ... based on the original menu served at the farewell dinner on July 22, 1944." But be warned: No lobster or escargot -- it was wartime, after all. All the details are here. Labels: Bretton Woods agreement, IMF, Mount Washington Hotel, World Bank Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Asia and the Meltdown of American FinanceFrom the fine MRZine site, Japan scholar R. Taggart Murphy provides a breezy, accessible discussion of some important history:Asia and the Meltdown of American Finance by R. Taggart Murphy The boardrooms and finance ministries of Seoul, Bangkok, Jakarta, and Kuala Lumpur are today filled with a fair degree of schadenfreude at America's troubles. Schadenfreude is not a very nice emotion; Theodor Adorno once defined it as "unanticipated delight in the sufferings of another." But asking Asia's business and governing elites to repress shivers of pleasure at the meltdown of the American financial system is probably demanding more than flesh and blood can bear. The spectacle of the politicians, pundits, and academics of Washington and Chicago thrashing about in attempts to justify the vast amounts of money being shoveled at their, um, cronies on Wall Street is just a little too rich. Particularly since much of the money will have to be borrowed from the very people who a decade ago at the time of the so-called Asian Financial Crisis were being pooh-poohed for their "crony capitalism," "opaque" banking systems, "incestuous" government-business relations, not to mention their supposed absence of transparent financial reporting, good corporate governance, or accountable executives and regulators. But the glee in seeing the United States hoisted by its own petard must surely be mixed with a good deal of apprehension. Not only because Asia cannot escape this crisis unmarked. But because the crisis could conceivably force Asia's elites to engage in the open political discussions they have largely avoided until now -- discussions about the kinds of economies they expect to shape in the wake of the American debacle; discussions that carry with them all kinds of risks. Read the rest of this post Labels: Bretton Woods agreement, currencies, financial crisis, Monthly Review, R. Taggart Murphy Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Keep Your Irony Meters on HighThis posting is from D&S collective member and frequent blogger Larry Peterson. To see more of his posts, click here.Well, they've finally succumbed to the inevitable. No less a devout free marketer than President Bush announced this morning that the US government will buy stakes amounting to $250 billion in the largest US banks. This followed similar nationalizations carried out in Europe, of the sort the US had initially resisted for itself: but the fear that foreign banks would attain a competitive advantage over their US rivals essentially forced the administration's hand. So a process that started as a beggar-thy-neighbor policy in Ireland (when it guaranteed bank deposits some two weeks ago) has ended with the reluctant signing-on of the sole superpower, a call for a "New Bretton Woods" by the strangely ascendant UK government (it had initially protested vehemently against the Irish move, once again fearing the advantage the deposit guarantee would give Ireland's banks in an atmosphere characterized by bank failures of gargantuan proportions), and only with the help of tiny Iceland's near-death experience. But the expected surge on Wall Street has, as of one-thirty EST, failed to materialize. It seems investors are now switching their concern to the profit outlook of US corporations (third-quarter reports will be coming in fast and furious for the next few weeks), and the picture there is dire. Consumer activity is dormant, debt levels remain stressed, and employment will probably take a big hit. In addition, corporate bankruptcies are expected to jump, a situation exacerbated by the gumming-up of short-term credit markets, which are still, despite the nationalizations, in an extremely sensitive state. And if that weren’t enough, states (especially the one with the biggest economy, California) and municipalities are finding their sources of borrowing dry up, and their costs skyrocketing. One thing I'd point out as I close this very short post. Inflation figures in the UK chalked up a stunning 5.2% in September, and that while home sales plummeted 55% in August. This alone, for a country with large current account and budget deficits, and a faltering currency, could encourage comparisons with some developing country enmeshed in crisis, and at the mercy of the world. But the UK is now in the forefront of the semi-nationalized recapitalization movement, putting huge sums of public money on the line to save its banks. And it won't have the luxury, as the US does, of borrowing from foreigners in its own currency. Prime Minister Brown's day in the sun may be a short one. Labels: Bretton Woods agreement, george bush, Gordon Brown, Larry Peterson Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). |
