Deflationary Times12th January 2015
Imagine running a business when your selling price plummets by 42% in the course of a year, and you can do absolutely nothing about it. This, when your input prices have risen 6%, or how about 156%? Well some businesses are already facing just that. Such is life if you produce Brent Crude in the UK[1], pay for your supplies in dollars[2], or even worse if your business is based in Russia.[3] Now combine that with reduced access to investment capital to achieve change and less...
A dose of stress for Europe27th October 2014
What do the latest ECB European bank stress tests tell us about the health of our nearby continentals and their economy? They’ve taken a year to work on, and have just been published as 170 pages of the grandly titled “Aggregate Report on the Comprehensive Assessment”, so lets hope the stress of waiting was worth it. Well, the headlines sound OK, with the EU’s banks showing a total capital deficit of just €9.5 billion to meet the latest stress tests. Before the crisis...
The Sheep have Turned13th October 2014
Now that the Scottish have had their say, it has been interesting to review a few headlines. My favourite, from a US website, was “The Sheep Have Bleated”. It makes the point that the majority, whether through positive choice, fear or misunderstanding voted for the apparent security implied by “together is better”. Our democracies have become entranced by the 51% principle, despite the fact that it is only those floating voters at the margin who decide the outcome of most...
Financial Alchemy19th June 2014
Little has changed. Six years after the depth of the financial crisis, our financial alchemy has achieved … not a jot. Our remarkable era of low interest rates, high debts and deficits has become the unremarkable new normal. Yet the media speak is all about employment recovery and asset price recovery (indeed record-breaking peaks in many markets). So has the alchemy worked? Some concerns are raised and shared, from whiffs of interest rate rises to come, London...
Currencies and Borders: Why would the Scots want the Pound?28th April 2014
Just like all full-blooded Englishmen I have a view on Scottish independence. Putting aside my annoyance at Mel Gibson for his inaccurate Hollywood portrayal of history, there has been plenty of justifiable historic animosity. But cross-border raiding seems now to run wholly in the Scots favour, with their elected representatives inappropriately shifting the balance of power in Westminster on solely English issues. This Westminster vote-rigging is not the fault of the Scots, just the...
2013 Top Ten28th December 2013
Just as a collection of bright ties is a matter of taste, of hits and misses, one year on from the launch of FYI's website its time to highlight the hits that have drawn the most attention. So if you've had neither time nor inclination to wade through the lot, here are the edited highlights of 2013: Economic Blogs: 1st: The Hobbit: Tolkien the Economic Libertarian? Drawing global interest and recommendation. Proving that you can't beat contemporary relevance. 2nd: The Economics...
Life After The State, a guest blog by Dominic Frisby18th November 2013
'Until August 1914 a sensible, law-abiding Englishman could pass through life and hardly notice the existence of the state, beyond the post office and the policeman'. So wrote AJP Taylor as the opening lines of best-selling English History 1914–1945. 19th century Britain was indeed a much more free existence than that of today. You didn't need a passports (you could travel abroad without permission or ID), you could change money without restriction, taxes were paid on a modest scale (8% of...
Be Prepared: The Game Has Changed8th April 2013
Spring is in the air, and my daffodil bank has been having a terrific year, indeed the best for some time. Bulbs are clever things, storing their energy to create an annual flush of pleasure, before quietly regrouping, replenishing their reserves in preparation for the next, even stronger, annual flush. But away from nature, mankind has been playing, and carefree economics is causing casualties, as we forget to replenish our reserves. Spring carried a bitter economic twist for Cypriots. For...
Surprised by Cyprus? You shouldn’t be25th March 2013
If we are ever to understand opportunity and risk, we need to think for ourselves, and think well outside of the box. Or perhaps in Cyprus' case the holiday suitcase. The mainstream does none of this, stuck in silo thinking all of its own making, so no wonder they get surprised by events. If one can ever take satisfaction from a disaster, I was quietly pleased to have blogged on 20th February "the next default ... Cyprus ... a bail-in of bank depositors ... queues forming outside the doors...
The Hobbit: Tolkien the Economic Libertarian?31st December 2012
As thousands of us headed to the big screen this season, the top film has surely been The Hobbit – An Unexpected Journey. Critics tell us much about the filming in 48 frames per second, but surely we are better focusing on the story and the real thinking behind it. Over an excellent lunch before Christmas[1], it was suggested to me that JRR Tolkien, writer of The Hobbit and it’s masterly sequel Lord of the Rings, is considered by many to be a Libertarian. For one committed to the free...