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Saturday, May 5

5th May - Weekender: Economics

Here are the less-timely economics articles from the past week or so. You can get update notifications by following MoreLiver on Twitter or Facebook. Contact me with any questions or suggestions!  

Previously on MoreLiver:

Zero-sum debateFree exchange / The Economist
Economists are rethinking the view that capital should not be taxed

Growth divergence between US and Europe? It's the credit conditions stupid...Macronomics

What next for the IMF?Economist’s Forum / FT
The IMF membership remains then split into two camps: those governments that might tap the extra funds and those (including the
US) that cannot conceive of any circumstances when they would do so. Not surprisingly, the latter are far from excited about contributing to increased lending IMF capacity. What must add to the latter’s fears is that European governments may be working on the assumption that their considerable representation on the IMF board will result in less demanding future IMF programmes for eurozone countries.

Saving Imbalances and the Euro Area Sovereign Debt CrisisNew York FED (pdf)

How to End This DepressionThe New York Review of Books
Krugman: The truth is that recovery would be almost ridiculously easy to achieve: all we need is to reverse the austerity policies of the past couple of years and temporarily boost spending. Never mind all the talk of how we have a long-run problem that can’t have a short-run solution—this may sound sophisticated, but it isn’t.

The Incredulity ProblemKrugman / NYT
In macroeconomics, the equivalent would be people who “just can’t believe” that borrowing more can help the economy, or that a fall in wages would actually reduce employment. What are they missing? Mainly, I think, the closed-loop nature of macro. Our intuitions about how business-y stuff works come from businesses or households selling their goods or labor to an external market.

We’re not Greece. We’re not Europe. But we could become the U.K.Wonkblog / WP
Europe is a mess. But it’s the type of mess that both the left and the right think validates everything they’ve been saying about what we should -- and shouldn’t -- do here in the U.S. “The right argues we have to cut deficits now or we’ll be like Greece,” says Tom Gallagher, a principal at the Scowcroft Group. “The left argues we can’t cut deficits now or we’ll be like Europe.”

The debt crisis: Spot the deleveragingButtonwood’s / The Economist
In reality only US has deleveraged – everyone else has just gotten more public debt.

The Future of CapitalismMilken Institute / Global Macro Monitor
1h video: Niall Ferguson / Harvard, Ana Palacio / Spanish Council of State; former Minister of Foreign Affairs, Peter Passell / Milken Institute, Raghuram Rajan / Chicago Booth School of Business

Strategic Briefing: Gov't Spending & The EconomyThe Capital Spectator

How the 2007 US housing bust stacks up against other housing correctionsSober Look

How big was the US housing bust, really?Also Sprach Analyst

Trend growth expectations and U.S. house prices before and after the crisisBundesbank (pdf)
Deutsche Bundesbank Discussion Papers by Mathias Hoffmann, Michael U. Krause, Thomas Laubach

The Information Content of Central Bank MinutesRiksbank (pdf)
Sveriges Riksbank Working Papers by Mikael Apel and Marianna Blix Grimaldi
We measure the sentiment and tone of the minutes of the Swedish central bank using an automated content analysis that converts the qualitative information in the minutes to a quantitative measure. We find that this measure is useful in predicting future policy rate decisions.

Symmetric goals, asymmetric risksmacroblog
Just as there are asymmetric risks associated with below-objective inflation when it comes to the Fed's growth and employment mandate, there are asymmetric risks associated with above-objective inflation when it comes to the price stability mandate.

Monetary policy developmentsBIS (pdf)
Speech by Mr Mervyn King, Governor of the Bank of England, on the 2012 BBC Today Programme Lecture, London, 2 May 2012.

Economic (in)stability under monetary targetingBank of Italy (pdf)
Bank of Italy Working Papers by Luca Sessa

Monetary policy and the flow of funds in the euro areaBank of Italy (pdf)
Bank of Italy Working Papers by Riccardo Bonci

Prudential lessons from the Global Financial CrisisBIS (pdf)
Presentation by Mr Grant Spencer, Deputy Governor of the Reserve Bank of New Zealand, to the Financial Institutions of NZ 2012 Remuneration Forum, Auckland, 3 May 2012.

Goodfriend Says Fed Not `Preemptive’BB (mp3)

The Periodic Table of Bank Regulation and ComplianceAlacra Store
Alacra has released the beta version of a tool to keep track of bank regulation and compliance in a clear and understandable format. Presented as a Periodic Table, the beta version includes 76 “elements” representing major regulations and regulators.

Bank regulations: Balancing the booksThe Economist
Rules are hurting profits; but banks still have a lot of fat to cut

Andreas Dombret: Europe's solution for too-big-to-failBIS (pdf)
Speech by Dr Andreas Dombret, Member of the Executive Board of the Deutsche Bundesbank, at the Institute for Law and Finance, Goethe University, Frankfurt am Main, 3 May 2012.

Shadow Banking in the Euro Area – An OverviewECB (pdf)
Although overall shadow banking activity in the euro area is smaller than in the United States,
it is significant, at least in some euro area countries. This is also broadly true for some of
the components of shadow banking, particularly securitisation activity, money market funds and
the repo markets.

Modelling the liquidity ratio as macroprudential instrumentDNB (pdf)
Netherlands Bank DNB Working Papers by Jan Willem van den End and Mark Kruidhof: The Basel 3 Liquidity Coverage Ratio (LCR) is  a micro prudential instrument to strengthen the liquidity position of banks. However if in extreme scenarios the LCR becomes a binding constraint, the interaction of bank behaviour with the regulatory rule can have negative externalities.

Capital regulation, liquidity requirements and taxation in a dynamic model of bankingBundesbank (pdf)
Deutsche Bundesbank Discussion Papers by Gianni de Nicolò, Andrea Gamba, Marcella Lucchetta