From FT:

Time for the ECB to get serious about the overvalued euro - Willem Buiter

Why the euro is not the next global currency - Jean Pisani-Ferry and Adam Posen

Safe as houses - FT editorial on new mortgage regulation

From elsewhere:

The global crisis and central banks in Latin America: Breaking with the past - Luis I. Jácome H., VOXEU

The secret Paulson-Goldman meeting - Felix Salmon, Reuters

Why Is The Chamber Of Commerce Defending Big Banks? - Simon Johnson, Baseline Scenario

So Now We Know Why Lehman Went Under - Naked Capitalism

From the FT:

Goodbye, Macroeconomics - Eli Noam

The travesty of the commons - Christopher Caldwell on the field of Nobel winner Elinor Ostrom

The free market is not up to the job of creating work - Mort Zuckerman on US unemployment

Countdown to the next crisis is already under way - Wolfgang Münchau

Down but not out - Krishna Guha on the dollar

Elsewhere:

Cognitive Dissonance and Global Macroeconomics - James Kwak on rhetoric and reality in the global imbalances debate, at Baseline Scenario

Escaping the state should cost Lloyds - Peter Thal Larsen, Reuters

Herbert Hoover and the start of the Great Depression - Lee E. Ohanian on history VOXEU

No L - James Hamilton on having avoided an ‘L-shaped’ recovery, at Econbrowser

Goldman Turns Into a Financial Frankenstein While the Fed Snoozes Away - Huffington Post

A reflection on the G20 (The question never asked to Mr Zoellick) - Biagio Bossone on the legitimacy of the G20 for small nations, at VOXEU

From the FT:

Wolfgang Münchau: Making the case for a weaker dollar

Alan Rappeport: US trade gap unexpectedly narrows in August

Editorial comment: US jobs subsidies

Roger Altman: How to avoid greenback grief

John Authers: Manufactured surprises will keep stocks rolling

Elsewhere:

James Hamilton, Econbrowser: Will stimulating nominal aggregate demand solve our problems?

Brad Delong on the wisdom of more fiscal stimulus

Paul Krugman, NYT: The madness of the monetary hawks

James Kwak, Baseline Scenario: “What’s wrong with a phone call?” - How Wall Street influences Washington

Alan S. Blinder, VOX EU: 25 per cent of US jobs are offshorable

By Thomas Palley

Over the past year the global economy has experienced a massive contraction, the deepest since the Great Depression of the 1930s. But this spring, economists started talking of “green shoots” of recovery and that optimistic assessment quickly spread to Wall Street. More recently, on the anniversary of the Lehman Brothers crash, Ben Bernanke, Federal Reserve chairman, officially blessed this consensus by declaring the recession is “very likely over”. Continue reading "A second Great Depression is still possible"

A year ago, the world economy fell into a deep recession. Now, happily, we see financial stabilisation and economic recovery. But we must not declare victory. The world could still make two mistakes: first, we might withdraw stimulus too soon; second, we might lose the opportunity for reform. We must avoid both dangers. That is the lesson I learnt at the annual meetings of the International Monetary Fund and World Bank in Istanbul. So where are we and where do we need to go? Think of this in terms of five ‘r’s: rescue; recovery; rebalancing; regulation; and reform.

Continue reading "Finding a route to recovery and reform gets tough now"

From the FT:

Michael Milken: Prosperity rests on human and social capital

Wolfgang Münchau: Diverging deficits could fracture the eurozone

John Authers: Crisis creates new sophistication in risk

Deven Sharma: Insight: Consistency in credit ratings

Elsewhere:

Dimitri Vayanos and Paul Woolley, VOX EU: Capital market theory after the efficient market hypothesis

Simon Johnson, Peterson Institute: The G-20, the IMF, and Legitimacy

Paul Krugman, NYT: Obama’s Anzio

James Kwak, The Baseline Scenario: Fed Chest-Thumping for Beginners

By Michael Pomerleano

I was in Chicago last week to participate in the 12th Annual International Banking Conference sponsored by the Federal Reserve Bank of Chicago and the World Bank. The answer to the question posed — have the rules of the global financial game really changed? — is a resounding no.

This was my first week back in the US after being away for three years, and the conference gave me an opportunity to gauge the state of the debate there. Compared to my two years at the Bank of International Settlements in Basel and my year at the Bank of Israel, the openness of the debate and the quality of the discussions in Chicago were refreshing. However, in the US — the epicentre of the crisis and the country that is supposed to lead the world toward reform and out of the crisis — I expected a far more forceful articulation of remedial measures. Continue reading "Another crash is all too possible"

From the FT:

Jean-Claude Trichet: Europe has mapped its monetary exit

Timothy Geithner: Financial stability depends on more capital

Gillian Tett: A matter of retribution

Elsewhere:

Mark Kleinman: Reforming regulatory benefit cost analysis

Viral Acharya:   Systemic risk and deposit insurance premiums

Paul Krugman:  How did economists get it so wrong?