April links

Below is a list of the things I have been reading and using as background to the posts I have written this month. It's not exhaustive.


Financial Conduct Authority documents:

Risk outlook - http://www.fsa.gov.uk/static/pubs/other/fcarco.pdf
Business plan - http://www.fsa.gov.uk/static/pubs/plan/bp2013-14.pdf

Prudential Regulatory Authority documents:


Noah Smith on equilibria: http://noahpinionblog.blogspot.co.uk/2013/04/what-is-economic-equilibrium.html

QE is a joke - wonkmonk_'s charts showing worldwide govt bond yield convergence http://img809.imageshack.us/img809/9585/qeisajoke.png

Free e-book of Smith's The Wealth of Nations (via Paul Krugman) http://www.gutenberg.org/files/3300/3300-h/3300-h.htm

Scott Fullwiler on endogenous money and monetary policy http://e-elgar.metapress.com/content/p1pnrh752u863711/?p=ff2f90ab29d24e6abff741e84f6bb597&pi=1

Cyprus: memorandum of understanding http://media.philenews.com/PDF/mnimonio_new.pdf
Cyprus: amendments to memo of understanding (govt statement) http://www.moi.gov.cy/moi/pio/pio.nsf/All/79FB17F3A7C4426BC2257B41005B482E?Opendocument
IMF statement on Cyprus http://www.imf.org/external/np/sec/pr/2013/pr13103.htm
El-Erian on Cyprus https://www.linkedin.com/today/post/article/20130406231951-204274949-hey-they-are-stretching-the-truth-way-too-far
Buiters' note on Citi http://willembuiter.com/cyprus2.pdf

Malta - Seeking Alpha article: http://seekingalpha.com/article/1313801-malta-another-weak-link-in-the-european-chain-of-tax-havens?source=email_macro_view&ifp=0

Banking Union speech by Yves Mersch: http://www.ecb.europa.eu/press/key/date/2013/html/sp130405.en.html

Banking union article - Munchau http://www.ft.com/cms/s/0/df18590a-9d4b-11e2-a8db-00144feabdc0.html#axzz2Po1Bb32P

Finpoint on funding for lending: http://blog.finpoint.co.uk/item/funding-for-not-lending-it-s-not-money-supply-blocking-funding-to-uk-smes?category_id=3

CIMA's Financial Management mag: http://www.fm-magazine.com/pdfs/APR_2013.pdf (good articles)

John Grout on wholesale deposits becoming "hot money": http://www.treasurers.org/node/8930 (very important article on untoward effects of banks' flight to safety)

Salz review of Barclays: https://www.salzreview.co.uk/c/document_library/get_file?uuid=557994c9-9c7f-4037-887b-8b5623bed25e&groupId=4705611

Walker report on corporate governance of banks & other MFIs http://webarchive.nationalarchives.gov.uk/+/http://www.hm-treasury.gov.uk/d/walker_review_261109.pdf

Anat Admati - paper on bank equity finance: http://www.coll.mpg.de/pdf_dat/2010_42online.pdf

Liikanen report: http://ec.europa.eu/internal_market/bank/docs/high-level_expert_group/report_en.pdf

IT in banking http://www.open.ac.uk/business-school/files/business-school/file/publications/research/WP01_5.pdf


Pew report on effects of recession in US (via Bloomberg) http://www.bloomberg.com/news/2013-04-23/wealthiest-americans-only-winners-in-recovery-pew-says.html


Brave New World - Huxley (free to read) http://www.huxley.net/bnw/

Other stuff

A Grunch of Giants (ref. IK) http://www.tripinsurancestore.com/4/grunch-of-giants.pdf

Mozart piano concerto 23 - Horowitz - via Strikelawyer.


  1. On the subject of QE being a joke, there’s a nice chart showing the equally farcical effects of the base rate cut in 2009. See third and last chart here:


  2. "shows that interest on reserve balances does not
    impede the transmission of monetary policy"

    Fullwiler doesn't know what he's talking about. Between 1933 & 1942 Fed policy was likened to “pushing on a string”. It wasn’t until 1942 that the CBs remained fully “lent-up”, i.e., they held no excessive amount of excess legal lending capacity to finance business (or consumers).

    Between 1942 & Oct 9th 2008 excess reserves were used to acquire a piece of the national debt or other creditor ship obligations that are eligible for bank investment. I.e., the CBs finding themselves with excess reserves (unused legal lending capacity), immediately bought liquid short-term obligations, pending a longer term, & presumably more profitable disposition of their funds.

    Then came the IOeR policy which induced dis-intermediation (like during the 1966 S&L crisis), where the size of the NBs shrink, but the size of the CB system remains the same.

    The IOeR policy doesn’t “divorce money from monetary policy”, it emasculates the Fed’s “open market power”. Whereas an injection of reserves (open market operations of the buying type by the FRB-NY’s “trading desk”), formally resulted in an immediate expansion of the CB’s investment or loan portfolios, nowadays it results in the mal-distribution (re-concentration) of excess reserves.

    1. As this post is simply a list of reading material, I don't think this comment is appropriate here. Can I suggest that you re-post it to Scott Fullwiler's site so that he can see it and respond to your criticisms. Otherwise you are simply sounding off to no purpose.

  3. Hi Frances, thanks for referencing John Grout's article on wholesale deposits. It appears the link is not live, is it possible to update this? http://www.treasurers.org/node/8930
    Thank you


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