Archive for November 6th, 2013

Why Japan has managed to avoid fiscal crisis despite highest debt/GDP ratio?

November 6, 2013

Charles Y. HoriokaTakaaki Nomoto and Akiko Terada-Hagiwara have this nice paper on the topic.

The reason is obvious — much of debt is held internally by domestic investors. Post 2008 crisis foreign holding has increased which kept the boat going. But this cannot go on forever:

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Central banks are only needed when governments want to spend beyond their means..

November 6, 2013

As we near 100 years of Fed foundation, getting to read some really interesting pieces. They start looking at Fed and in the process tell us a lot about central banking. Cato Institute has couple of monetary scholars talking on the subject in coming days.

Gerald P. O’Driscoll Jr. of Cato argues we do not really need Fed atleast in the current form. It is more interesting as he worked in Dallas Fed for a long time:

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