An ongoing debate concerns the plunge in the four-week Treasury note yield in relation to the three-month Treasury yield. At least one tweeter claims it’s all about the coming debt ceiling showdown with the difference in rates (3.145 percent versus 5.070 percent) reflecting the risk of having liquidity tied up within three months as the debt
It’s the weekend, but our fresh Financial Crisis does not sleep. And a recent study says we’ve only seen the tip of the iceberg. The Washington Post yesterday wrote: “If banks were suddenly forced to liquidate their bond and loan portfolios, the losses would erase up to 91 percent of their combined capital cushion.” In other words, we were already
The collapse of Swiss banking giant Credit Suisse recently was a catastrophe long in the making. A quick perusal of the bank’s financial statements from recent years shows that we’re dealing with something analogous to a classic bank run. Credit Suisse’s pool of liquid assets declined more than 50 percent from 2021 to 2022, mostly in October 2022,
It’s hard to crack the headlines of the financial pages, what with GameStop, bitcoin, Tesla, and squeezes of one sort or another. There is a squeeze in commercial real estate that won’t shock anyone, or shouldn’t. That squeeze is tenants unable to pay owners and owners unable to pay lenders. It’s possible the pandemic will fizzle, someone will
Niall Ferguson holds a PhD in philosophy from Oxford, taught history at Harvard and NYU, and wrote perhaps the definitive biography of Henry Kissinger. So, naturally, Bloomberg hired him to write on economics. His most recent column for Bloomberg is a strained mix of the Scot’s views on inflation, tempered slightly by a welcome skepticism toward
We hear plenty about threats to American democracy: Donald Trump’s a threat, the Republican party is a threat, and any number of other people or political parties are threats. Now it’s ExxonMobil’s purchase of Pioneer Natural Resources. Jeff D. Colgan, a professor of political science and the director of the Climate Solutions Lab at Brown
Prices will always increase, some small banks will fail, and the Fed was asleep at the switch when the run on Silicon Valley Bank occurred. Fed chair Jerome Powell admitted those three things in response to Scott Pelley’s questions on 60 Minutes . “But the overall price level doesn’t come down. It will fluctuate. And some . . . goods and services
Back when I was a construction lender, I thought the perfect construction loan would pay off after one day, just long enough to collect the loan fee. After all, time is your enemy in construction lending. Any of a myriad of unknowns can keep construction from being completed: the market may evaporate for what is being built, interest rates may
In the international fixed-income markets, interest rates are rising, and the decades-long trend of declining bond yields has undoubtedly been broken. On August 2, 2022, the ten-year United States Treasury yield was 0.5 percent; on October 9, 2023, it had risen to 4.8 percent. Long-term interest rates in Europe, Asia, and Latin America have also
In May this year, the Congressional Budget Office estimated outstanding US government debt next October to be $27,388 billion. By the end of the first quarter of the fiscal year, it will exceed $34,000 billion. It is soaring out of control, and perhaps it is not surprising that the CBO has not updated its forecasts with this debt uncertainty. The
What is the Mises Institute?
The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard.
Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.