Lord Turner Tobin Tax Proposal: Brown Backtracks Following G20 Meeting

 Overview

Following intense debate over UK banking bonuses, the head of the Financial Services Authority (FSA), Lord Adair Turner, has suggested the introduction of a tax on financial transactions. Such an idea, first put forward by Nobel laureate and economist James Tobin, is known as a Tobin Tax. Whether this proposal bears fruit remains to be seen – Chancellor Alastair Darling has dismissed suggestions that the idea be discussed in the Treasury. 

On November 7-8, 2009, Gordon Brown carries the idea to the G20 finance minister meeting, arguing that „such a levy could prevent excessive risk taking and fund future bank rescues.“ U.S. Treasury secretary Timothy Geithner is against a day to day tax on speculation, which makes it a non-starter on an international scale. (Bloomberg, 11/08/09)

Abtrennung riskanter Segmente. Mervyn King will Banken aufspalten

Strengere Eigenkapitalvorschriften? Testamente für Institute? Alles schön und gut, findet der Chef der Bank of England. Aber die nächste Krise wird das aus Sicht von Mervyn King nicht verhindern. Er fordert radikalere Schritte.

Mervyn King gehen die bisherigen Reformpläne nicht weit genug

von Chris Giles, London. Aus der FT Deutschland: 

Der Gouverneur der Bank of England, Mervyn King , fordert die Aufspaltung von Banken.

Do not learn wrong lessons from Lehman’s fall

By Martin Wolf; FT

Published: September 15 2009 20:20 | Last updated: September 15 2009 20:20

“If the price of oil stabilises, I believe we can weather the financial crisis at limited cost in terms of real activity.” Thus did Olivier Blanchard, newly appointed head of the International Monetary Fund’s research department, describe the prospects ahead on September 2 2008. He was swiftly proved wrong.

Few economists then realised how fragile the global financial system had become. The failure of Lehman Brothers just under two weeks later and the ensuing crisis at AIG, the insurance giant, turned complacency into terror. The financial system plunged into an abyss, dragging the economy behind it.

What lessons are we to learn from this shock, a year later?

Lehman aftershock

A year ago, Lehman Brothers collapsed giving a shock to the global economy. How has the finance sector changed since?

Der zweite Teil des Financial Times Videos.

How Lehman Collapsed

Zwei gute Videos von FT.com. Lehman Collapse, Interview with John Tain

The Risk of a Double Dip Recovery

Video Interview der FT mit Nouriel Roubini am Ambrosetti Forum in Mailand.

Roubini On U Shaped Recovery: More Statesmanlike or Less Certain?

Yves Smith | Aug 24, 2009

Nouriel Roubini verged on apocalyptic during the course of the crisis, and was proven largely right. Now that he has softened his stance, some have accused him of moderating his tone as a result of his much higher profile.

While that’s possible, a couple of factors seem more likely. First and foremost, much of Roubini is now being filtered through the MSM, which as many readers have commented, has been too often trying to find the happy face in any bit of economic news. A glaring instance in July was when Roubini put out a press release disputing a Bloomberg news report claiming Dr. Doom had said the recession would be over this year. So we are not getting the raw, unedited, long form Roubini of RGE Monitor, which tends to pointed language, but the MSM soundbite. Some of the forcefulness of Roubini’s views comes from his relentless and usually multi-point exposition, and not just colorful turn of phrase.

The Risk of a Double-Dip Recession is Rising

Wieder ein grossartiger Nouriel Roubini.

25. August 2009, 00:48:06 | Nouriel Roubini

From the Financial Times:

 

The global economy is starting to bottom out from the worst recession and financial crisis since the Great Depression. In the fourth quarter of 2008 and first quarter of 2009 the rate at which most advanced economies were contracting was similar to the gross domestic product free-fall in the early stage of the Depression. Then, late last year, policymakers who had been behind the curve finally started to use most of the weapons in their arsenal.

 

That effort worked and the free-fall of economic activity eased. There are three open questions now on the outlook. When will the global recession be over? What will be the shape of the economic recovery? Are there risks of a relapse?

Is China Being Screwed by the EU?

China Economist | Aug 3, 2009

I for one did not realise that the EU tariffs on screws was so high. Why?

The FT report (plus this story makes for a good blog title).

Anti-dumping legislation is always interesting (at least to me) and the EU are getting more and more trigger happy when it comes to using anti-dumping as a means of protection. Dumping is always hard to prove.

It will be interesting to see how this plays out.

What Is Josef Ackermann’s Point?

Simon Johnson | Jul 31, 2009

Writing in the Financial Times yesterday, Josef Ackermann – CEO of Deutsche Bank – argued that larger banks are not more dangerous to the health of financial system (and thus to taxpayers) than smaller banks.  According to him, system danger arises primarily from the degree to which banks are “interconnected”.

Inadvertently, Mr. Ackermann makes a strong case for banking system reform.  You can break this down into five parts.