Hutton on the Transport White Paper

Will Hutton might be less than 100% sound on the capital markets, but he is often excellent on public policy and infrastructure and he has an excellent article in yesterday’s Guardian on the recent Transport White Paper: There isn’t an adult in Britain who does not believe that our transport system is overcrowded, unreliable and […]

Is Economics an Equilibrium Discipline?

An interesting post on the Street Light Blog, on currency misalignments, suggests an interesting question: is economics an equilibrium discipline? The very idea of a misaligned FX rate suggests that the natural state is an aligned one: perhaps the fundamentals move faster than the markets adjust, so FX is never in equilibrium. Perhaps (in the […]

Who is getting hurt in equity/credit?

There are, if not falling cubes, then certainly some falling knives out there. Indeed the current market gyrations seem to suggest a dislocation between the equity and credit markets as well as a weakening of sentiment. As the often amusing Naked Capitalism puts it: [...] fixed income types speak of truly grim conditions, of the […]

The Death of Metronet

The collapse of Metronet and the attendant comment suggests it might be worth saying something about risks in equity and debt finance. The classic model of a company is that it can raise money in two ways: by issueing shares, or by borrowing money. The best thing that can happen to a lender is that […]

Japanese jitters

Nuclear safety fears after quake according to the BBC. Certainly building a nuclear reactor is an earthquake zone might strike a naive observer as reckless. But then anything that depends on safe confinement for hundreds of thousands of years is reckless. The nuclear industry appears to have a decent safety record over tens of years. […]