The Basel-accord are frequently paraphrased in the debate around banking stability and its third step, Basel III, is seen as a set of rules and regulations that once and for all will avoid future financial panic.  But as always, this can be interpreted as mere smoke screens to avoid financial system collapse now – but…

We are proud to say this article was published on Casey Research’s The Room this Friday. If you are not familiar with the work of Casey Research we suggest you check it out. Note; we use the conventional GDP typology as opposed to GDC, since readers unfamiliar with Bawerk.net will not recognize GDC as a term. ___________________________________ While…

On July 27th Prince Alwaleed bin Talal publicly opened Pandora’s Box, by releasing an open letter to the Saudi Minister of Petroleum, Mr Ali Al-Naimi, voicing his concerns about the longer-term implications on the Saudi economy of the US shale gas boom. The concerns are both real and relevant – in fact it is something…

Part III: Abenomics and the road to collapse. Abenomics is the label given to Prime Minster Abe`s three pronged plan to revive the Japanese economy. One of his first acts as Prime Minister was to place trusted inflationist at the helm of BoJ. The new Chairman, Mr. Kuroda, did not disappoint with his plan to…

Part II: From quagmire to Abenomics. Unsurprisingly the policy lead to a massive increase in debt levels. In order to feed the unsustainable system, consecutive Japanese governments threw money at it with the perverted consequence of depriving corporations of capital. Government debt grew inexorably while corporations got squeezed. Source: Bank of Japan – Flow of…