Afternoon Links 3-17

March 17, 2010

Google flips the bird at China (google.cn) Do a search on google.cn for “tianamen.” Those aren’t the image results you’d see if Google still cared about mollifying Chinese authorities.

Three large Puerto Rican banks being shopped by FDIC (Rieker, WSJ) Bank failure preview…

FOMC statement, redacted (Merkel) David analyzes what the Fed said yesterday. Among other things, it confirmed that it’s quantitative easing plans — i.e. printing electronic money to buy MBS — will end on schedule this month. Expect it to come back. Why? See next link…

Japan increases quantitative easing to fight deflation (Tabuchi, NYT) As it enters its third consecutive lost decade, Japan is still fighting the deflationary forces of its own burst real estate bubble. Remember, credit is money. When the economy generates lower levels of credit, it reduces the money supply. That’s deflation. The levels of debt we’ve reached are so high, there’s nowhere for credit to go but down over time. That means we’ll be fighting deflation for years ourselves, here and in much of Europe….especially the UK.

44 of 172 Detroit schools slated to close in June (AP)

Squatter stimulus, no mortgage payments for three years and counting (Calculated Risk) This is the homeowner equivalent of what I mentioned on Sunday regarding private equity and for-profit education. Putting lots of debt onto an asset in order to finance a cash withdrawal. Homeowners did it too, though few probably came out as far ahead as this person…

China, Germany committing world to deflation (Wolf, FT…ht Yves) Does anyone else have as much trouble as I do loading web pages from FT.com?

Repo 105, “like, whatever” (Felix)

China in midst of “greatest bubble in history,” Rickards says (Hu, Bloomberg) In related news, the World Bank urged China to cool its economy.

Winter Paralympics (Big Picture blog)

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