Archive for December 13th, 2013

How UK has local currency circulating along with Pound Sterling…(and economics of local currency)

December 13, 2013

This is a brilliant research note by Mona Naqvi and James Southgate of BoE. I mean it is so interesting to read such pieces..

The authors talk about this thing called local currency. This is the currency which runs parallelly along with the major currency. Some local communities use things like credit notes, own currency notes to settle transactions among them. For instance, it is common in India to get such notes/coupons etc from shopkeepers for lack of change. Yes, we also get a lot of toffees/candies these days instead of small denomination change.  Wondering whether candies be treated as local currency too?

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Greenspanisation of Asia..

December 13, 2013

A brilliant column by William Pesek of Bloomberg.He says what this blogger has been saying for long though from an Indian perspective.

Pesek argues that this is for Asia as well. . The markets in Asia have recovered  and gone crazy without any real reform. Why? Central  bankers busy creating Greenspan era in Asia:

What does Alan Greenspan have to do with rallies in Indian stocks, hopes for a resurgent Japan and the blind faith that China can grow at a rate of 7 percent forever? More than you’d think.

Call it the Greenspanization of Asia. The former chairman’s tenure at the Federal Reserve, from 1987 to 2006, established a new political compact of sorts, whereby governments abdicated responsibilities to unelected central bankers. The “Greenspan put” that flooded markets with cash whenever things got dicey has become the default position in Washington. In Asia today we’re seeing an even more dangerous escalation of the practice – – papering over cracks in economies that desperately need tougher, structural reforms.

He begins with India:

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Why resource rich countries need a good communication policy?

December 13, 2013

A superb article by Paul Collier of Oxford Univ.

He says the countries which have natural resources need to also have a good communication policy to keep the hype down. After all resources may not be that valuable and moreover are non-renewable. So people should not take things for granted:

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Why Euro zone needs a subservient central bank?

December 13, 2013

Nicholas Crafts of University of Warwick has this interesting column.

He points to lessons from Great depression (what else) for Euro zone. The lessons are indeed bitter and unlikely to be implementable as he says ECB should be more subservient to Government:

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Ukraine’s woes…Why and How..

December 13, 2013

it is Ukraine’s time under the radar..the country is going through tough times.

Though the trouble has been brewing for a while (it is never sudden really), I realised a crisis in coming on reading this MR post.

As the crisis has become thicker, so has the reading material:

Interesting set of political events responsible for the Ukraine rising..


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