Paul Jorion's Blog

Category: Economy

  • WELL SPOTTED, BRAVO!, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell As already highlighted the Spanish government is already benefitting from a de facto rescue plan under another name. To save appearances, the new austerity measures put forward for vote in parliament have not been the object of a memorandum jointly signed with those providing the funds,…

  • TIME WILL TELL… AND MAYBE IT ALREADY HAS , by François Leclerc

    Guest post. Translated from the French by Tim Gupwell In the hope of solving the problems once and for all, Mariano Rajoy has decided to take drastic measures in Spain. Taken as a whole, he asserts that the measures that he is going to have adopted by the Cortes (the Spanish Parliament) represent some 65…

  • A CRITICAL MASS OF CONTRADICTIONS, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell Once more, the crisis has taken a turn for the worst in the days after a summit which was intended to resolve it. Barely ten days ago, two practical decisions came out of it, and neither has been implemented in practice; nothing has really been done…

  • WHEN WE’RE NOT MOVING FORWARDS WE’RE GOING BACKWARDS…, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell The European Finance Ministers managed during the course of the night to finalize a minimal agreement, which needs, as usual, to be examined in detail due to its grey areas. They put together a set of nominations to the ECB and the ESM based upon the…

  • THE HEARING OF PAUL TUCKER, DEPUTY-GOVERNOR OF THE BANK OF ENGLAND, BEFORE THE BRITISH TREASURY SELECT COMMITTEE

    Translated from the French by Tim Gupwell Paul Tucker, Deputy Governor of the Bank of England, made a statement this afternoon before a British Treasury Select Committee. The reason for his presence today was that on the 4th July, before this same committee, Bob Diamond (who was the Chief Executive of Barclays until a few…

  • LIBOR: WE AIN’T SEEN NOTHING YET

    Translated from the French by Tim Gupwell From the Financial Services Authority’s Final Notice of their decision, dated the 27th June, to impose an 85 million Pound fine on Barclays Bank (less a reduction of 30% for exemplary co-operation with the enquiry) due to their manipulation of the LIBOR interbank rates, two separate periods need…

  • REFRESHER COURSE: HOW AL CAPONE FELL

    Translated from the French by Tim Gupwell Idea association being an excellent means of investigation… here is a reminder of this article dating from 26th March 2010. Everybody knows the history of Al Capone, who was never caught by the American state for his racketeering activities but was brought down by an investigation for tax…

  • THOSE RESPONSIBLE FOR THE CRISIS WHO ARE RARELY TALKED ABOUT

    Translated from the French by Tim Gupwell The question of whether a debt contract can be considered as money is central to my book L’argent mode d’emploi (2009). I expose the violence exerted by Joseph Schumpeter (1883-1950), when he imposed the idea that such was the case, and I demonstrated the inanity of the pseudo-arguments…

  • GUILTY PARTIES WANTED !, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell In accordance with the predictable script, the bond market is under pressure again. The cost of servicing Spanish and Italian debt has continued to increase as their financing plans move forward in little measured steps. The effect of all this is to place an additional burden…

  • LIBOR: DELAYED INDIGNATION

    Translated from the French by Tim Gupwell The paradox of the 2008 ‘LIBOR scandal’ – in addition to its familiar ring in 2012 – is that, as I alluded to at the time and as I recalled a few days ago, the fraud was well-intentioned for once: the ‘philia’ of Aristotle, the good will exercised…

  • THIS SYSTEM IS ITS OWN WORST ENEMY, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell In the little game of who won and who lost, what conclusions can be drawn from the recent European council? Interpretations differ widely: some highlight the German Government’s about-turn, who themselves retort that the essence of their position has been preserved intact; others congratulate Mario Monti…

  • THE WINDOWS MUST REMAIN CLOSED, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell By rejecting the quartet’s plan, (which has, moreover, already been watered-down) before the summit has even been held, the German deputy foreign affairs minister, Michael Link has placed himself in the avant-garde of all those opposing any attempt at a compromise. The “iron chancellor’s” hard-line approach…

  • DO YOU KNOW WHAT SCHMILBLICK IS ?, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell We recently touched on the quartet engaged in drawing up a composite motion, in order to faire avancer le schmilblick (= to move the schmilblick forward, or in other words to make a limited contribution to solve a complex problem). Before describing their efforts it may…

  • “KANT WAS RIGHT!”

    Translated from the French by Tim Gupwell A female reader of my blog asked me to give her some tips for her upcoming business school exam. This is how I replied. It seems important to me to focus on the possibility that any measures proposed can be generalized. It was Martin Wolf who pointed out…

  • AFTER THE WORDS, THE MAGIC FORMULA…, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell What can you say when you are in total disagreement? You can always assert, with one voice, the need for a union! This is this perspective that the quartet composed of José Manuel Barroso, Mario Draghi, Jean-Claude Juncker and Herman Van Rompuy (in alphabetical order) continues…

  • STICKING TO ONE’S PRINCIPLES…, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell What was the plan being drawn up last week in Rome which Merkel refused to sign up to? The other three participants, Mario Monti, Mariano Rajoy and François Hollande advocated using the EFSF, and in the near future the ESM, directly, to bail-out the banks without…

  • RED HERRINGS, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell The magic word growth only needs to be pronounced in order for everything to become just like it was before. At least that is what the four European leaders gathered yesterday at Rome seemed to believe when they announced the figure of 120 to 130 billion…

  • TREASURE HUNT, by François Leclerc

    Guest post. Translated from the French by Tim Gupwell Following the clues for the next bail-out of the Spanish banks is proving to be a veritable treasure hunt. To participate, follow the guide! Initially, the EFSF (European Financial Stability Facility) is going to borrow funds on the markets, using the member states guarantees, in order…

  • France 24, “Is François Hollande’s fiscal program likely to hurt France’s competitiveness?”, at 7:10 PM, June 21st 2012

    Don’t you love the way this is phrased? Can the guy ever recover from such an even-handed (cough! cough!) way of setting the issue? Anyway, here it is.  

  • SPAIN: BOND MARKET THIS THURSDAY 21St JUNE

    Spain managed to borrow 2.22 billion Euros this morning. It was hoping to raise 7.7 billion. The Wall Street Journal pointed out that this was “thanks to demand seen overwhelmingly coming from domestic banks”. The coupon obtained by lenders for 2 years was 4.706% (compared with 2.069% on the 1st March); over 3 years it was…