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QE is reversible, goes the argument: monetary financing is forbidden.

This is something that you have to say when you are currently a central banker, to prevent politicians running off to the sweetshop with central-bank funded spending.

Those who have previously been in the chair, such as Lord King, seem relaxed at the largesse. The question is one of degree, and confidence in the independence of institutions.

Telegraph  8 April 2020

EU Fails to Agree on 500 bn euro. Negotiations end in acrimony

The acrimony (bitterhet) highlights how Europe is mired in the same old divisions that almost tore it apart during the sovereign debt crisis almost a decade ago. 

Bloomberg 8 April 2020

In 2012 she /Ms Merkel/ said there would be no eurobonds “as long as I live”. After nine European heads of government wrote a joint letter last month saying the EU needed to “work on a common debt instrument”, she said pointedly that that wasn’t “the opinion of all member states”.

 Germany’s constitutional court had made clear that such an innovation would need the prior approval of the Bundestag, and a two-thirds majority might be required for such a fundamental change

FT 6 April 2020

Time to integrate further or break-up

For two decades they /Northern leaders /have shied away from the fact that the currency union cannot succeed unless its members share more risk.

If they do not face up to that today, the euro, and perhaps the European Union itself, will not survive.

The Economist 11 April 2020

To the astonishment of almost everyone in the room, Angela Merkel began to cry.

the man sitting next to her, French President Nicolas Sarkozy, and the other across the table, US President Barack Obama

Das ist nicht fair.” That is not fair, the German chancellor said angrily, tears welling in her eyes. “Ich bringe mich nicht selbst um.” I am not going to commit suicide.

A cornered Ms Merkel threw the French and American criticism back in their faces. If Mr Sarkozy or Mr Obama did not like the way her government ran, they had only themselves to blame. After all, it was their allied militaries that had “imposed” the German constitution on a defeated wartime foe six decades earlier.

Peter Spiegel, Financial Times 11 May 2014

EU finance ministers struggle to break impasse between Italy and the Netherlands

Italy’s finance minister Roberto Gualtieri said his government would not accept a final report sent to EU leaders unless it explicitly mentioned debt mutualisation as a tool for the economic recovery. 

Rome also demanded that any use of loans from the European Stability Mechanism come with no conditions attached.

The Netherlands’ finance minister Wopke Hoekstra said no on both points. 

FT 8 April 2020


Since the Great Financial Crisis, the primary stock buyer has been the listed companies themselves via their stock repurchase programs.

Their net purchases dwarf all others.

CARES Act restricts buybacks from companies receiving federal loans, loan guarantees, or other assistance.

All that means buybacks will likely be scarce for a while, and stock prices may have a hard time rising unless some other large buyer appears. 

Bull markets require people willing to buy. 

Bear markets develop simply in the absence of buyers.

John Mauldin with nice chart 3 April 2020

In the eurozone, they talk much of eurobonds.

But the support that matters will have to come from the European Central Bank. 

There is no alternative. Nobody should care. There are ways to manage the consequences. 

Even “helicopter money” might well be fully justifiable in such a deep crisis.

Martin Wolf 7 April 2020


Ledare i Financial Times öppnar för Helicopter Money

Ekonomer och andra måste lägga Joakim von Anka bakom sig, skrev jag här i går.

Detta upptogs inte väl av alla. Det får man ta.

I dag kan man läsa en ledare i Financial Times som skriver:

Helicopter money is a valid tool for central bankers

Quantitative easing programmes may be here for the long term

Without limits, allowing a government to finance itself by creating money can lead to hyperinflation. But these risks can be manageable

There is no clear distinction between quantitative easing and monetary financing.

The scale of today’s downturn means even the most direct monetary financing, such as “helicopter money”, or handing cash to the public, should remain an option.

German Foreign Minister and Finance Minister called for a European response to the economic fallout of the pandemic.

"We need a clear expression of European solidarity in the corona pandemic," the high-profile German officials said in an op-ed published in several European newspapers in Italy, France, Greece and Spain.

Deutsche Welle 6 April 2020

Germany has always argued the idea would violate the “no bailout” clause in the EU treaty, which says that no EU country should be liable for the debts of other members

FT 6 April 2020

”Kerstin Hessius-gänget”

Realtids Johan Såthe frågar sig om de som vill öppna vår ekonomi igen – ”Kerstin Hessius-gänget” – verkligen har fattat att Sverige kanske är det mest öppna landet av alla?

”Människor kommer inte att börja agera ’normalt’ förrän de anser att det är säkert att göra det. Det är inget någon politiker kan bestämma, det är virusspridningen som avgör”, skriver han.



Ekonomer och andra måste lägga Joakim von Anka bakom sig

Farbror Joakim hade sina penningbingar med guldpengar. När han köpte något blev det mindre kvar. Detta är ett synsätt som många har svårt att frigöra sig ifrån.

Har vi råd med alla dessa stödåtgärder frågan sig många, alltför många. Men dom har väl inte läst vare sig Keynes eller Friedman.

"Om man har en sedelpress går man inte i konkurs", skrev jag nyligen.

Man har en sedelpress om man har en egen valuta och inte är med i EMU.

En utgift är en belastning om den medför att man inte kan göra något annat för dessa pengar. 

Underskottet i statsfinanserna är en ointressant siffra. Staten kan ge ut obligationer som Riksbanken köper. Den går inte i konkurs för den har verkligen en sedelpress.

Man skall i stället, återigen efter många år, hålla ett öga på penningmängden.

Om ett företag eller en löntagare går med förlust och detta underskott täcks av statsbidrag är penningmängden oförändrad.  

Vi måste också sluta med fiktionen att Riksbanken inte är en del av staten. 

Om staten har en skuld på 1.000 miljarder och dessa obligationer har köpts av Riksbanken tar dessa summor ut varandra.

Niema problema, säger anhängarna av Modern Monetary Theory.

To the extent modern monetary theory is true, it is unoriginal; 

to the extent it is original, it is false

The doctrine behind MMT was smart but not completely right

Faced with slow growth, political discontent, and large inherited debt burdens, monetary finance cannot be a taboo option.

 Adair Turner, a former chairman of the United Kingdom's Financial Services Authority and former member of the UK's Financial Policy Committee, is Chairman of the Institute for New Economic Thinking. 

The deficit only matters once you reach full employment, when overheated consumer demand can lead to inflation. 

But we’re nowhere near that point right now, meaning there’s plenty of room for deficits, without any possibility of default.

New Republic 11 May 2016

Monetarism på min site

Money creation in the modern economy at Peak Prosperity

Money creation in the modern economy at Bank of England pdf, QB 2014 Q1

Why the Fate of Milan Will Be the Fate of Italy

The government is deploying at least 50 billion euros ($55 billion) in economic aid, which will add to borrowings already totaling 135% of GDP, more than twice the ratio of Germany.  

That growing debt load threatens to leave Italy dependent on the European Union to maintain financial stability—and could put it at the mercy of its EU partners to keep investment flowing.

The virus crisis is unfolding just as Italy’s banks have finally gotten back on their feet after the 2008 financial crisis. 

Nice pics.

Bloomberg 4 April 2020

Furious at their plight being ignored and over resistance to coronabonds, Italians’ sense of betrayal deepens

“You have to consider my party is one of the most pro-European parties in Italy and I now have members writing to me saying: ‘Why do we want to stay in the EU? It is useless.’”

Donald Tusk, the former European Council president, who is now president of the European People’s party, the centre-right political alliance. 

“We must save Italy, Spain and the whole of Europe and not be afraid of extraordinary measures. This is a state of emergency.”

FT 6 April 2020

What Happens When Stock Buybacks DROP By 50%?

Corporate Debt Domino Effect Has Begun.

The Money GPS Youtube 5 April 2020

Skapar centralbankerna stagflation? Experter tvekar.

När världens centralbanker pumpar ut likviditet i de finansiella systemen har oroade röster pekat på risken för stagflation – att arbetslöshet och inflation lyfter samtidigt.

Med bra länkar.

Sandra Johansson omniekonomi 4 april 2020

Om Stagflation hos IntCom


Siktade Lee Harvey Oswald inte på JFK utan på John Conally?

John Connally; On November 22, 1963, he was seriously wounded while riding in President Kennedy's car in Dallas, when the president was assassinated. 

Connally does not endorse the conclusions of the Warren Commission. When asked if he believed the Warren Commission's findings he said: "Absolutely not. I do not, for one second, believe the conclusions of the Warren Commission."

Connally hade varit marinminister och därvid avslagit Lee Harvey Oswald överklagande av sitt vanhedrande avsked ur Markinkåren. 

Det var kanske Connally som Oswald siktade på och inte JFK?

Den frågan har man kunnat läsa på min website i många år.

När jag nu googlar hitta jag en artikel från 2016 om att historian and journalist James Reston Jr. has questioned whether JFK was the actual target

Reston argued in his book about the assassination, “The Accidental Victim,” that Oswald had long harbored a deep grudge against the Texas Governor; 

Oswald's attempt to defect to the Soviet Union had led to his discharge from the Marines being downgraded to undesirable and he knew that when he returned to the United States he would struggle to find work because of it. 

He appealed to Connally, then Secretary of the Navy and a fellow Texan, only to be rebuffed with a letter embossed with the Secretary’s smiling face and a campaign leaflet urging him to support his candidacy for Governor. 

This, Reston believes, was the root of Oswald’s hatred and ultimately lead him to plot the politician’s assassination.

He adds that in the testimony of Oswald’s wife, Maria, to Congress’s Select Committee on Assassinations in 1978 she categorically named Connally as the real target of the assassination, not JFK. 

Other people who knew Oswald are alleged to have corroborated this view, saying that he in fact admired JFK for his efforts to engage with the USSR.

If so, why is this theory not more widely accepted? 


James Reston Jr.’s notion that Lee Harvey Oswald’s real target was Texas Gov. John Connally was firmly rejected by Vincent Bugliosi in his definitive investigation published in 2007, “Reclaiming History.” (“Lee Harvey Oswald’s little green book shows JFK wasn’t the real target,” Opinion, Nov. 22)

Bugliosi reports that Connally wrote to Oswald that he had left his position as Navy secretary before Christmas 1961 in order to run for governor of Texas, and he was passing along Oswald’s request to his successor, Fred Korth. 


Former Secret Service Agent Bill Carter explains, "So anyway, he got kicked out of the marines, and when I saw that, who was the Secretary of the Navy who’s in charge of the Marines? John Connally was sitting in front of Kennedy."

Connally had become governor of Texas after being secretary of the Navy.



ECB should not be used to finance national borrowing, which is explicitly prohibited by its founding treaty.

To trigger the ECB’s power to buy sovereign debt under OMT, a country must first have been granted a rescue programme from the European Stability Mechanism. 

This would need a unanimous vote from all eurozone members, which gives Germany a veto.

For the distressed borrower, the conditionality this implies would be humiliating. 

Mr Draghi never had to put OMT into effect and, even now, no one wants to invoke the mechanism to support the stressed states in the pandemic.

FT 3 April 2020

Germany is the largest guarantor of the OMT

Fannie and Freddie could require bailout if lockdown lasts

The two groups.collectively underpin the $10tn US housing market..

Regulator Mark Calabria, director of the Federal Housing Finance Agency. says US mortgage guarantors have sufficient resources for about 12 weeks

“Fannie and Freddie are still in conservatorship and 
levered 240 to 1. 

FT 3 April 2020

Fannie and Freddie at IntCom

What about the hundreds of billions of dollars of Level 2 and Level 3 assets held by the biggest banks?

Complex, risky trades whose fair value is hard to determine.

These are the so-called Level 2 and Level 3 assets, the types of instruments that blew up in 2008.

Europe’s banks have hundreds of billions of euros of risky assets

Bloomberg 3 April 2020

Emerging market debt burdens may be sorely understated

It makes much less sense for a bond issued by Petrobras International Finance Company, a Cayman Island subsidiary of the Brazilian oil group, to be added to the debt statistics of the Cayman Islands.

Investors braced for credit crisis in emerging markets

Last month $31bn was sucked out of emerging-market debt funds, the biggest outflow on record since October 2008, according to the IIF. 

Analysts say the developing world as a whole is more resilient than at the onset of previous downturns, such as the Asian financial crisis of 1997-98 and the Latin American debt crisis of the 1980s. 

FT 2 April 2020

Asian financial crisis of 1997-98 

Latin American debt crisis of the 1980s

"Om man har en sedelpress går man inte i konkurs".

Hur kommer det sig att regering och riksbank i Sverige, England och USA gång på gång kan lägga fram stödpaket på mångmiljardbelopp? 

Var kommer pengarna ifrån frågar sig nog många.


Svaret är att den svenska regeringen kan alltid betala sin skulder /denominerade i kr/.

Men Grekland  och andra euroländer har sina skulder i euro och sedelpressen står i Frankfurt och kontrolleras av ECB.

Jag inbillar mig gärna att jag var en av de första som på nätet observerade att "Om man har en sedelpress går man inte i konkurs". 

Det var varit det till synes självklara budskapet på denna blogg ett antal gånger, första gången i november 2011.

Sedan kom även BBC och Soros på det.

Soros om att dom inte förstod att det var ett stort steg att avskaffa den egna sedelpressen

BBC: Greece does not have its own central bank that print money

EU och ECB kunde kväsa Grekland. Pengarna tog slut i de grekiska bankomaterna.

England kunde lämna EU eftersom Bank of England har en egen sedelpress.

Det var således viktigt att det blev Nej till svensk euroanslutning i folkomröstningen 2003.


Antibody tests will soon tell us

We will have a clear sense of how many people have already had Covid-19 and whether or not there really is an iceberg of asymptomatic cases below the visible tip. 

What if the bad scenario is avoided, but not completely?

Let us suppose that serological antibody tests show the true picture to lie somewhere between the two poles: neither enough infections to reach herd immunity thresholds (and therefore to contemplate dialing down the lockdown); nor the clarity of economic Armageddon in the necessary defence of life.

Ambrose Evans-Pritchard, Telegraph  1 April 2020

Jag tror på Mohamed

The risk that the financial system will reverse-infect the real economy and cause a depression is too big to ignore.

As for the severity and duration of the coming recession, all will depend on the success of the health-policy response

No tax rebate, low-interest loan, or cheap mortgage refinancing will convince people to resume normal economic activity if they still fear for their own health. 

Mohamed A. El-Erian Project Syndicate 26 March 2020 

De certifikat som Riksbanken köper får ha en maximal återstående löptid på upp till tre månader.

En lång rad svenska företag har gett ut certifikat, allt från storföretag som Trelleborg och Holmen till en lång rad mindre, framförallt fastighetsbolag. 

Det pressade hotellfastighetsbolaget Pandox lånar till exempel 3 miljarder kronor i ett företagscertifikatprogram.

Med längre löptid, över ett år, kallas motsvarande lån för företagsobligation.

SvD 2 april 2020

Virus Leaves Thatcher’s Children with Bigger Nightmare Than 2008

“There’s going to be government money going into all sorts of places that would have been unthinkable just weeks ago,” said Philip Hampton, former chairman of Royal Bank of Scotland Group Plc, which in 2008 received the biggest bailout of any lender in the world.

“This is obviously an exceptional time, with exceptional measures called for,” said Robert Colvile, director of the Centre for Policy Studies, the London-based think tank co-founded by the late U.K. Prime Minister Margaret Thatcher.

Commercial paper market still creaking despite Fed measures

Financing costs in the commercial paper market — typically seen as one of the safest lending markets, where companies borrow cash for periods up to one year — have soared since the coronavirus pandemic reached US shores.

FT 1 April 2020

The health system will be overwhelmed,” Mr Marks said. “There will be a point where there doesn’t seem to be an end in sight. I’m afraid the headlines are going to get much uglier in this regard.”

Market recovery will unravel as coronavirus fallout mounts, warns Oaktree’s Marks


“Everyone knows you are playing with fire with leverage,”

In 2008, the culprits were real estate speculators, investments banks that fueled the bubble while leveraging books about 40 to 1

They borrowed to multiply profits on mortgages, junk debt and municipal and government bonds. The leverage means losses are getting amplified too.

The drop in prices for leveraged loans is also hitting investment vehicles known as collateralized loan obligations that are packed full of them.

Bloomberg 1 April 2020


Nightmare Haunting Euro Founders May Be a Reality With Italy

The longstanding suspicion that Italy’s profligate borrowing could ultimately become the whole of Europe’s problem was the recurring nightmare of German finance officials throughout the 1990s.

Italy’s finances now depend wholly on the European Central Bank keeping a lid on its borrowing costs. Meantime, the only realistic question for officials in Berlin is how to structure further aid, since the alternative may be a failed state at the heart of the currency union, fatally threatening the euro.

Bloomberg 31 March 2020

Mona Sahlin är inte helt inkompetent

Mona Sahlin självkritisk om SD: ”Det var fegt gjort”

Publicerad 30 mars 2020 kl 20.00

Det gör att man osökt erinrar sig Tony Blairs medarbetare som 9/11 tyckte att det var en bra dag för att få ut dåliga nyheter.

Miss Moore's memo, written at 2.55pm on September 11, when millions of people were transfixed by the terrible television images of the terrorist attack, said: 

"It is now a very good day to get out anything we want to bury. Councillors expenses?"

The announcement she referred to related to a minor U-turn on pension rights for councillors.

Miss Moore, 38, apologised and Downing Street /Tony Blair/ said that this would be enough to allow her to keep her job.

We are about to see the return of our long lost friend: inflation

Britain’s best known monetarist, Tim Congdon.:

“Given that money and nominal GDP do track each other over time, it seemed plausible also to propose that inflation might reach 5pc at some point in the next two to three years.

I now feel that I was being too conservative. The annual rate of money growth to spring 2021 might be between 10pc and 15pc, perhaps even heading towards 20pc. If so, the right sort of maximum inflation rate to expect in the next few years would be in the 5pc to 10pc band.”

Jeremy Warner Telegraph 31 March 2020

Wobbles in collateralised loan obligations pose problems for lenders

Lenders on both sides of the Atlantic have upwards of 100 open credit lines to vehicles known as collateralised loan obligations, 

which are among the biggest sources of funds for businesses that do not have top-quality credit ratings,

FT 31 March 2020

2007 it was a real estate bubble in the US and Club Med. This time it’s a global corporate debt bubble


Germany will only act to help others when it perceives an existential threat to the eurozone

As the German constitutional court keeps reminding us in ruling after ruling, fiscal policy is a national prerogative. 

If the nine countries want to go down the mutual path, they can. It is a risky choice, but not nearly as risky as sheltering under the rescue umbrella the eurozone set up after the last crisis.

Wolfgang Münchau 29 March 2020

Karl Marx, WeWork and the junk bond bubble

When the banks were bailed out at a cost of hundreds of billions of dollars during the 2008 crisis, it was supposed to be a one-off intervention by governments and central banks, designed to save the financial system and prevent a collapse in the world economy.

Barely a decade later and we have another “black swan”.

Now, in addition, the global economic shutdown threatens WeWork’s fundamental business model — and in a way that has startling echoes of the failure of Lehman Brothers, Northern Rock and other high-profile casualties of the last financial crisis.

The reason those institutions failed was because they had relied on high volumes of very short-term finance, when their own lending commitments were far longer-term.

FT 30 March 2020

Northern Rock


Germany's refusal to embrace 'coronabonds' amid the crisis could threaten the European Union's very survival

EU project in ‘mortal danger’ if Italy and Spain are abandoned 

Jacques Delors, former Commission chief and euro godfather, who stepped back into the fray this weekend, denouncing Europe's paralysed response to the greatest crisis since the Second World War as a “mortal danger” to the European project.

Delors launched monetary union in the early 1990s on the implicit assumption that it would be the federalysing catalyst, leading – by means of crises – to full fiscal and political union. 

Ambrose Evans-Pritchard, Telegraph  29 March 2020


Macron warned that the political reaction after this crisis could kill the European project

Angela Merkel agreed with the bleak assessment of the situation, she resisted calls for mutualizing debt, warning against unrealistic expectations. 

Merkel’s tone was more categorical than before

After Bailing Out Euro Area, Lagarde Tackles Merkel on Debt

Bloomberg 26 March 2020

Germany’s top court has already warned that eurobonds would require a change in the country’s Basic Law

The most heavyweight endorsement of a move towards true fiscal union 

The constellation — call them the “No Limits Nine” — have written to European Council president Charles Michel calling for the creation of a common debt instrument to fight the devastating impact the coronavirus crisis is threatening to wreak on Europe’s economy.

Among the signatories are usual suspects such as France, Italy and Spain and relatively new adherents such as Ireland, Slovenia and Luxembourg. 

 The statement is perhaps the most heavyweight endorsement of a move towards true fiscal union in the history of the single currency area. But for now, that call will go unheeded.


Dow rallies more than 1,300 points, biggest 3-day surge since 1931

Om vi skulle göra som Trump och Jacob Wallenberg vill

Säga att nu är det fritt fram att åka pendeltåg och tunnelbana, gå på bio, äta på restaurang och göra båtfärder på kryssningsfartyg, hur många skulle göra det då?

Det blir inte som vanligt förrän medborgarna känner att risken att bli smittad är låg.


Allmänhetens hållning är fullt begriplig och i många fall även rimlig. Den grundar sig på uppfattningen att coronasmittan ännu inte är under kontroll.
Därför går det inte att slå in på helt annan väg innan så länge som hotet hänger över oss: svenskarna har visat att vill vara försiktiga. 
En tidsgräns av den typ som har föreslagits av Tredje AP-fondschefen Kerstin Hessius skulle inte fungera.

ECB has given itself an unprecedented level of flexibility in its plan to buy €750bn in additional bonds

Almost all constraints that applied to the ECB’s previous asset-purchase programmes have been removed or significantly loosened

FT 26 March 2020


Germany’s top court has already warned that eurobonds would require a change in the country’s Basic Law

As always in EU politics, ideologues are pursuing their own Monnet agenda: exploiting Covid-19 to advance federalist integration by means of crisis without clear democratic consent. 

“They are making the same serious category error as they did in the Greek crisis in 2010. They are treating an insolvency crisis as if it were a liquidity crisis,” said Yanis Varoufakis, the former Greek finance minister.

Acting as a lender-of-last resort for the country - though vital - does not conjure away the deeper issue that Italy requires a huge devaluation and a debt restructuring to break out of the contractionary spiral and restore lost viability.

“How much of Italy’s debt is the ECB going to keep buying. A quarter? Half? Three quarters? At some point the system cracks,” Mody said.

Ambrose Evans-Pritchard, Telegraph  25 March 2020

Corporate bonds have become very illiquid

Holders of the ETF have stampeded to the exits and, just as the ETF critics consistently predicted, 

this liquidity mismatch has wreaked havoc with the market.

IEAC’s market capitalisation has fallen from over €13bn to €10bn in about a month.

FT 25 March 2020

Companies draw $124bn from credit lines

Back when the world was awash with liquidity, lenders would offer low-cost revolving credit facilities — akin to a credit card — as a perk to win other business. 

The banks believed that most would never be used in full; such was the stigma of large companies drawing them. 

Tegnell höjer ett varningens finger för USA

– Där händer väldigt mycket och det händer väldigt fort, och det kan bli problematiskt. 

Redan nu ser man väldigt många dödsfall och fall inom intensivvården, vilket talar starkt för att man har en rätt omfattande spridning i landet redan, som man kanske är lite för sent ute för att ta hand om på många ställen, säger han.

– Men vi får se, säger Tegnell.

SvT 25 mars 2020

Finance Minister Olaf Scholz urged lawmakers to set aside constitutional debt limits

to combat a crisis that threatens modern life. 

New borrowing of 156 billion euros ($169 billion), equivalent to half of the country’s normal annual spending, will be used to fund social benefits and direct aid to virus-hit companies.

Bloomberg 25 March 2020

Anders Tegnells fem coronaråd

Undvik barnbarn, butiker och bussar,

men gå gärna ut och träffa andra – på behörigt avstånd.

Ta reda på vilken hjälp du kan få i vardagen.

Använd ditt eget sunda förnuft.

Det är några av statsepidemilog Anders Tegnells råd till dig som är äldre.

Coronavirus in N.Y.: ‘Astronomical’ Surge Leads to Quarantine Warning

“We haven’t flattened the curve, and the curve is actually increasing,” Mr. Cuomo said. 

NYT 24 March 2020

Mr Trump’s suggestion that the US might simply abandon efforts to stop the pandemic spreading -  in order to revive the US economy- would almost certainly be self-defeating. 

California, New York, and Illinois, among others, are in lockdown and would ignore the White House. 

The result would be a half-baked containment policy that leaks badly and achieves neither one objective or the other.


The ECB must abandon the constraints on how many bonds it can buy from each of its members.

Europe needs unconstrained QE to save the euro.

In May  a German court is due to rule on the constitutionality of QE. 

Many expect the judges to vote that it’s unconstitutional. 

European governments would then be faced with a possible choice of abandoning the euro or coming up with real reform that takes the monetary union a step further, say through the issuance of a Eurobond.

Again, a crisis that threatens the euro’s very existence would lead to a reform that secures its future.

Melvyn Krauss Bloomberg 24 mars 2020

This pandemic is an ethical challenge

Long before government-imposed lockdowns, many people stopped travelling or going to restaurants, cinemas or shops. 

Decisive action to suppress the virus and follow up with testing and tracking of new infections could well end the inevitable economic slump even sooner than otherwise.

Martin Wolf 24 March 2020

Hope about Covid-19

If the Western democracies get a grip on Covid-19 with an immediate and total lockdown – which several are not yet doing – they can essentially overcome the pandemic within eight weeks.

An economic sudden stop for two months does not fundamentally matter – any more than a national holiday fundamentally matters – provided that the state acts as a shock absorber and keeps the productive system whole, avoiding mass bankruptcies and hysteresis.

 Ambrose Evans-Pritchard, Telegraph  24 March 2020

The pain of a much stronger dollar can be particularly acute in emerging markets, where businesses and households have ramped up borrowing via dollar loans.

The dollar’s surge echoes a similar jump during the most acute stage of the financial crisis. 

Firms around the world have dumped assets in a bid to raise cash. 

Outside the U.S., firms are in desperate need of the currency to serve a rising tide of dollar loans just as dollar revenues dry up.

MarketWatch 23 March 2020

Consider OTC derivatives We're Looking at a System-Wide Margin Call

The worst scramble for cash is happening in an opaque corner of the market that the Fed can’t control.

Consider OTC derivatives, which are mostly betting slips on the future movements of interest rates and currencies.

More than a decade ago, the scramble for cash wiped out as much as $36 trillion, or more than half of the market value of global equities. 

So far, the coronavirus has cost global stocks about $26 trillion, or roughly 30% of their market value, from their late-February peak. 

So you could argue there’s a long way to go.

Bloomberg 24 March 2020

Goldman Sachs spends $1.9bn to shore up two money market funds


En sak som måste undvikas – till varje pris: Att hushållen tvingas sälja sina hem.

Det är inte svårt att se 90-talskrisen framför sig. 

Skillnaden nu är att lånen är oerhört mycket större och räntekänsligheten högre.

Situationen är komplicerad eftersom hushållens bolån till stor del är finansierade genom bankernas säkerställda obligationer, ofta kallade bostadsobligationer.

Riksbanken accepterar numera också att banker lämnar in inte bara andras, utan också sina egna, bostadsobligationer som pant hos centralbanken för att låna pengar.

Louise Andrén Meiton SvD 23 mars 2020

Ingves upprepade sin varning om att utländska investerare kan tappa tålamodet med Sverige.

Och betonade att 81 procent av utlåningen från de svenska affärsbankerna har fastigheter och bostäder som säkerhet.

The Federal Reserve on Monday announced it would purchase an unlimited amount of Treasurys and mortgage-backed securities

in order to support the financial market. 

The Fed said it would buy assets "in the amounts needed" to support smooth market functioning and effective transmission of monetary policy. 

The Fed had previous set a $700 billion limit for asset purchases.

MarkerWatch 23 March 2020

Carry-Trade Losses Smash Records Amid Mad Dash Into Dollars

Returns on trades in which investors borrow in dollars to invest in developing-nation currencies have slumped 13% so far this year, the most since at least 1999

Bloomberg 23 March 2020

Carry Trade at IntCom

Swedbank Misstänkta insättningar för cirka 180 miljarder kronor. Och misstänkta kundutbetalningar för cirka 190 miljarder kronor.

Det är två viktiga inslag i den advokatrapport som publiceras idag från Swedbank. Kritiken innebär att risken för ytterligare miljardböter ökar. 

Swedbanks ordförande Göran Persson är besviken.

SvD 23 mars 2020

Even after eight years of the New Deal, the economy was still not out of depression by 1940

as critics of Roosevelt never tire of pointing out. 

Unemployment was still over 14 percent when World War II broke out.

It was the war, and the astonishing mobilization for war, that finally cured the Great Depression. 

Robert Kuttner NYT March 22, 2020

”Det som satte stopp för trettiotalsdepressionen i USA var ett massivt underskottfinansierat program för offentliga arbeten som kallas andra världskriget”.

As in 2007 and 2008, the problem of dollar liquidity will be at the heart of the crisis

This time, small guys should get the bailouts

In the previous crisis, Washington bailed out banks. Today, it’s about to bail out big business.

The corporate sector looks a lot like the financial sector did pre-2008: debt-laden, with some sectors highly leveraged, and most of them reliant on financial engineering to create the illusion of growth and innovation.

Rana Foroohar, Associate Editor at the Financial Times, 22 March 2020


Today’s financial fragility far predates the COVID-19 “black swan.”

Given the massive accumulation of debt in both developed and developing countries since the 2008 financial crisis, it has long been clear that even a minor event – some “known unknown” – could have far-reaching destabilizing effects. 

Yet, until recently, rising asset prices – owing to a long period of extraordinarily loose monetary policies in advanced economies – disguised mounting debt levels. 

As the recent scare in global equity markets indicates, asset bubbles cannot last forever. 

By contrast, in the absence of active public pressure or state intervention to facilitate their resolution, debts do not deflate on their own.

Javuati Goshi Ptoject Syndicate  16 March 2020 

En person förde smittan till Italien

Smittans förlopp har rekonstruerats noga av Italiens största morgontidning Corriere della Sera.

I centrum står en 38-årig man som troligen är den första smittade. 

Massimo Galli är infektionsläkare på sjukhuset Luigo Sacco i Milano. Han säger i en intervju i Corriere della Sera att epidemin startade utanför sjukhuset, men att den växte och fick fart inne på sjukhuset.

– Det är synd att vi inte förstod vilken sjukdom den förste patienten hade.

Carnegie Fonder in Sweden gated 12 funds on Friday, mostly in corporate bonds

Danske Invest, the asset management arm of Denmark’s biggest lender, had 15 Danish funds suspended on Friday, most of them in high-yield bonds. 

Carnegie Fonder in Sweden gated 12 funds on Friday, mostly in corporate bonds, while Forte Kreditt, a Norwegian high-yield fund, was suspended all of last week.

Other fund managers such as Spiltan, Cicero and Danske in Sweden and Jyske in Denmark all suspended funds last week.

FT 22 March 2020

BNY Mellon stepped in to support one of its money market funds

SEB var en av flera fondförvaltare som i slutet av förra veckan valde att stänga för handel i vissa räntefonder, vid sidan av bland annat Carnegie och Spiltan. Den smått unika åtgärden innebar att fondsparare som ville plocka ut sina fondandelar eller byta fondinnehav plötsligt inte kunde det.


Bilder i tunnel på Lidingö Larsberg

På min dagliga vandring genom skogen längs Lidingös södra strand passerar jag en gångtunnel.

Den har inte varit så rolig. Gångtunnlar brukar inte vara det.

Men nu är den utsmyckad.

Här kan man läsa vad den den föreställer.

Här flera bilder.

Under andra världskriget spelade Elfvik Gård en särskild roll. Här knäckte matematikprofessorn Arne Beurling den tyska chifferkoden, vilket gav den svenska försvarsstaben möjlighet att läsa ca 300 000 tyska meddelanden, ovärderligt i Sveriges roll för att hålla sig neutrala.

Svaret på hur man räddar ekonomin är just nu lika svårfunnet som boten mot covid-19.


Borrowing costs for companies around the world are rising dramatically despite central bank interest rate cuts

as rating agencies warn that the economic impact of the coronavirus will lead to a surge of corporate downgrades and defaults.

The average yield for investment-grade corporate debt has risen from 2.26 per cent two weeks ago to almost 4.5 per cent

FT 21 March 2020

Hidden within the $16 trillion corporate debt market are many potential troublemakers, including the zombies. 

BNY Mellon stepped in to support one of its money market funds

amid sharp outflows from parts of the sector this week, buying $1.2bn of the fund’s assets so it had cash to help cover redemptions.

The US bank made the liquidity injection as investors withdrew $6bn from the Dreyfus Cash Management fund in the week ending Thursday, around half of its assets,

FT 20 March 2020

Dreyfus Corporation

Varför min sida om Finanskrisen heter hedgefunds.htm

Finanskrisen och därmed eurokrisen tog sin början i Frankrike, när tre hedgefonder tillhöriga Frankrikes största bank, BNP Paribas, inställde betalningarna i augusti 2007.

Den dåvarande chefen för ECB, Jean-Paul Trichet,  pumpade raskt in 200 miljarder euro för att rädda bankerna.