Put simply: the central banks are not in charge. Waltraud Schelkle once compared it to Asterix and the Romans: anarchy, aided by the occasional dose of magic (financial innovation), withstands the imposition of order.
8/n
The best new Substack you're (probably) not reading yet. @cornelban.bsky.social covers everything from ruling the winds and green central banking to kinky investments, China as the revisionist terminator, and what it takes to scale technology on geoeconomic.substack.com
Public Investment Quality and Sovering Risk (with Amat Adarov) is now out in JIMF @gvagrad.bsky.social
Staff is currently striking here at the University of Edinburgh. Senior management is planning widespread compulsory redundancies (without a real need for the same). You can read more here @ucuedinburgh.bsky.social www.ucuedinburgh.org.uk/blog/rd72kte...
A needless rebranding -- historically and contemporarily a central bank purchasing bonds is normal! You are right, this can then be used as a justification for shelving.
What do you make of the section on the bond portfolios, is this "we're definitely stopping... unless we need to start again"? Why not just acknowledge that market-stabilisation runs on bonds?
IMF: "only about half of fiscal consolidations achieve their fiscal targets, including debt reduction. A broad range of econometric methods, based on well-established methods in the empirical literature, confirm that fiscal consolidations do not reduce debt ratios, on average."
Congratulations! and look, @fabianpape.bsky.social fresh figures for you nice dollar hegemony lecture.
Bang: "A truly healthy economy will come from a government taking responsibility for delivering meaningful change, not evoking the bond markets to avoid it."
It's only a matter of time before Weidmann's 'getting out of town' gets a different coat of paint too.
Paris-Berlin sleeper: low carbon, 2 years old, constantly full, but currently losing SNCF a few million EUR/yr
Intl Jet fuel tax exemptions are 80 years old and cost the EU 22 million EUR/yr for the Paris-Berlin route alone.
And you're cutting... the sleeper?
www.theguardian.com/travel/2025/...
We have a great job opportunity for an economic analyst focused on fiscal in our Brussels office BUT so far hardly any women have applied. Pls help us changed that and spread the word! Job posting: dezernatzukunft-my.sharepoint.com/:b:/g/person...
For a data collection we want to launch soon, we're looking for a German speaker who could translate our survey instrument to German. This should only take a few hours of work. Of course we are remunerating! Interested? Please reach out to @alexjabbour.bsky.social !
Domestic bond vigilantes - the unsung 'heroes' of market discipline; congratulations on this fine piece!
read @alphaville.ft.com series on the crazy 'fiscal headroom' games played by the OBR and the Bank of England with QT, games with real consequences, like the two-child benefit cap, and weep for Labour's toothless governing
www.ft.com/content/d593...
scrapping it would add GBP 2.5bn yearly to government spending. That is 25bn over ten years.
Only last year, the Treasury paid the Bank of England around 40bn for its 'losses' on the QE gilt portfolio.
It didnt have to. No other central bank expects to be compensated.
A case of ‘A poor craftsman blames his tools’ fiscal rules edition? Since '05, the Stability and Growth Pact could discount spending which fostered international solidarity (‘French defense spending loophole’) or which was thought to promote the unification of Europe (German unification loophole).
Highly recommended and eminently quotable on coercive decarbonisation, credit policy, and capital controls! - looking forward to the rest of the @ripejournal.bsky.social special issue on derisking.
Blown away by this erudite book by @valentimvicente.bsky.social 🤯 An exceptional combination of theoretical sophistication and empirical breadth and depth.
His theory of normalization not just helps explain recent rise of far right but also warns for overestimating strength of democracy.
congrats to my brilliant colleague & wonderful friend Saila Stausholm (sensibly not on here) for receiving with @javiergbe.bsky.social the Timothy J. Sinclair Best Article Award from @ripejournal.bsky.social for this paper! 💸
www.tandfonline.com/doi/full/10....
Is the model for this Nixon goes to China, Schröder's sledgehammer and Steinbrück's 'proudest political achievement' (from his memoir)?
@excubs.bsky.social is on the (book) case!
Agreed, and 'discipline' is a useful porthole for historically minded scholarship wanting to use your work as a starting point working backwards.
What a quote; the former UK Chancellor Hammond on the joys of contingent liabilities and why the model is not going anywhere (👋 de-risking), from Aeron Davis excellent history of the UK Treasury since 1976 (@manchesterup.bsky.social).
The World Bank calculated that the rich world earned more than $1.4tn in loan repayments from the global south world in 2023
"Colonial patterns of extraction plainly did not disappear with the withdrawal of troops, flags and bureaucrats."
www.theguardian.com/commentisfre...
Wow, fantastic material. Whenever I read about new developments in pension land, I remember your tweet that the military was allowed to opt out alone and stayed in the public system.
Perhaps even not that large ? -- main character energy from the FED as per usual: www.ft.com/content/0397...
“In the years since 1982, developing countries have transferred an estimated $4200 billion in interest payments to their creditors in Europe & North America, far outstripping the official-sector development aid these countries received during the same period“
www.phenomenalworld.org/analysis/new...
