Category Finance
Worrying about the Canadian housing market, Part 1: Higher interest rates
Like Nick, I've been thinking and worrying about the Canadian housing market, but not blogging about it. I've decided that it's worth putting some points out for discussion on the topic, if only because it's something we should be talking more about. I've broken it down to three separate posts: the second is here and […]
Trill Perpetuities, and dynamic inefficiency under uncertainty
A trill perpetuity is a bond, which promises to pay the owner a one trillionth share of nominal GDP (that's the "trill" bit), every year forever (that's the "perpetuity" bit). Trills, AFAIK, do not exist, though economists have thought about them. Perpetuities do exist (but are rare). Trill perpetuities do not exist. But they are […]
A Debt Interpretation of Canadian Confederation
The apparent success of Europe's leaders in dealing with the European economic crisis at their recent summit may mark the beginnings of a stronger fiscal union but exactly how this might be enforced is still a big question. The long term goal is to tie budgets, currencies and governments even more tightly together. However, without […]
Where’s the deflation? The supply side of banks
If banks go bust and firms can't get bank loans to finance their operations, that has supply side effects too. A firm that has plenty of customers, but can't get financing to produce enough goods to meet the demand, may raise prices. And if a firm closes down because it can't get financing, its competitors […]
Information and Empire
The case of the Parliamentary Budget Officer again locking horns with the federal government because of a request for information is symptomatic of a broader problem. The PBO is giving the government until the fall to release additional details of planned budget cuts or will take them to court. Naturally, in Ottawa’s current budgetary siege […]
Abolish the Equity Premium Now!
This post is slightly whimsical. I can't decide myself if I'm being totally serious. My argument is certainly less than watertight. But it's not (to me) obviously wrong either. So I'm just throwing it out there.
The Big Secret: Banks are banks
I have a confession to make. During the financial crisis I secretly bailed out the Bank of Montreal. I was part of a vast conspiracy of millions of other Canadians doing the same thing. It's worse. My personal bailout program for the Bank of Montreal started long before the financial crisis. It started when I […]
Provincial Finances: An Estimate of “Tax Prices”
My previous post dealt with differences in provincial health spending and how on a per capita basis some provinces were substantially above the provincial average while others were not. One of the factors behind any government spending at the provincial level is own source revenue capacity so in light of some of the comments asking […]
Banking “mysticism” and the hot potato
Paul Krugman seems to have gotten into an argument with the MMT guys about commercial banks creating money. I'm just giving my own views on this question. I'm basically following Leland Yeager [update: and David Laidler]. Strangely, while I agree with the MMT guys on many points (banks do create money out of thin air) […]
Ontario’s 2012 Budget: Bending the Spending Curve
Well the Ontario budget is out and despite all the talk of 30 percent across-the-board budget cutting in the wake of the Drummond Report, it forecasts more a deceleration of spending growth rather than steep cuts.
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