Willem Buiter Warns Sovereign Default Fears Will Spread To U.S. & Japan: "There Is No Place For Anyone To Hide"
Buiter is chief economist for Citigroup and a former UK Central Banker, who is keen on picking fights with Bernanke and the U.S. Federal Reserve, including a brilliant attack at Jackson Hole in 2008 which is detailed inside.
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Citigroup's Willem Buiter: an economist worth listening to
The Dutch-born scholar, a professor of political economy at the London School of Economics and former Bank of England Monetary Policy member, has never been afraid to speak his mind – even about past and present employers.
- In 2008, Dr Buiter turned his fire on his hosts when the Fed invited him to its annual retreat in the Teton Mountains. “The Fed listens to Wall Street and believes what it hears,” he told an audience of central bank officials from the Fed and around the world. “This distortion into a partial and often highly distorted perception of reality is unhealthy and dangerous.”
- Fed Governor Frederic Mishkin said at the same event that Buiter’s paper fired “a lot of unguided missiles,” and former Vice Chairman Alan Blinder “respectfully disagreed” with his analysis of the central bank’s crisis management.
He has degrees from the University of Amsterdam and Cambridge University and a doctorate from Yale University. He has taught at Princeton University, the University of Bristol, the London School of Economics, Yale University and Cambridge University. He was chief economist for the European Bank for Reconstruction and Development from 2000 to 2005.
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DB here. Now onto the story from today's Telegraph.
There are no safe sovereigns
Fears about the finances of eurozone nations will spread around the world to engulf the US and Japan, former Bank of England policy maker Willem Buiter has warned.
Worries about the risk of a sovereign state defaulting on its debt, which thrust the eurozone into crisis, will soon encompass the two major economies as well, according to Citigroup economists led by Mr Buiter, who sat on the Bank's Monetary Policy Committee.
The team has published a note forecasting much more strife to come in the wake of Greece and Ireland's recent bail-outs and eurozone governments' borrowing costs hitting record highs.
- "Despite the recent drama, we believe we have only seen the opening and second act, with the rest of the plot still evolving," the team wrote. "There is no absolutely safe sovereigns."
- There are likely to be several sovereign debt restructurings in the next few years, the analysts said, with Portugal likely to need to access the emergency funding facilities soon.
Against this backdrop, the US and Japan - dubbed the "fiscal sustainability deniers" - cannot keep ignoring the question of how safe their public finances are, the team said.
The fears about default will encompass the two economies "before long", they argued - particularly if a default is defined not just as a failure to meet the debt contract, but also as inflicting severe losses on debt holders through deliberately-engineered inflation or weakening the currency.
- "Both Japan and US public finances are unsustainable, in our view, and in the absence of credible and substantial fiscal tightening both would eventually face painful discipline through the markets," the economists wrote.
- It is only a matter of time before the US will have to raise funds by issuing debt offering "significantly higher" returns to bondholders, to reflect the level of risk surrounding it, they added.
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Buiter at CFR...
Video - Citigroup's Chief Economist Willem Buiter discusses the future of sovereign debt in the wake of the crisis in Greece - May 2010
- "There is no place for any nation to hide."
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Buiter on the future of banking...
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Willem Buiter on Bernanke's QE2 gamble...
More detail on this clip is here, including transcribed quotes...
And this is also an excellent clip from...
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Jan 11, 2011 at 5:40 AM
Reader Comments (9)
Today three Virginia taxpayers including one state lawmaker, in conjunction with the American Tradition Institute Environmental Law Center, are asking the University of Virginia to produce important ‘global warming’ records under the Commonwealth’s Freedom of Information Act.
These emails and other documents relate to claims made by Dr. Michael Mann to obtain, and claim payment under, certain taxpayer-funded grants. Mann, currently at Pennsylvania State University, worked at the UVA’s Department of Environmental Sciences when he produced what was hailed at the time as the ‘smoking gun’ affirming the theory of catastrophic man-made global warming. Despite that lofty honorific, persistent controversy led promoters of this notorious ‘Hockey Stick’ graph (principally, the UN’s Intergovernmental Panel on Climate Change or ‘IPCC’) to stop advancing it as serious work.
In response to a previous FOIA request, UVA had denied these records existed. But during the course of Attorney General Ken Cuccinelli’s pre-investigation under the Virginia Fraud Against Taxpayers Act (“FATA”), a 2007 law passed unanimously by Virginia’s legislature that clearly covers the work of taxpayer-funded academics, UVA dropped this stance. Court records reveal that counsel for the University has indicated instead that the Mann-related records do in fact exist, on a backup server. To avoid University delay or claims for huge search fees, today’s request specifically directs the school to search that server.
While the school has spent upwards of half a million dollars to date fighting Cuccinelli’s pursuit, now before the Virginia Supreme Court, under FOIA it has one week to produce the documents, with no exemption for UVA’s arguments used to block Cuccinelli. These records address one of the highest-profile claims used to advance massive economic interventions policies in the name of ‘global warming.’
The Environmental Law Center hopes for prompt University compliance with FOIA, although we are prepared to fully protect our appellate rights. We can then, finally, determine what it is that so many have gone to such great lengths to keep the public from knowing about that which the public has paid for.
http://seeker401.wordpress.com/2011/01/11/michael-mann-of-the-hockey-stick-fraud-is-about-to-be-exposed-bigger-than-climategate/
The European Central Bank (ECB) was forced to step in as market fears grew over Portugal's ability to solve its debt crisis.
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8247468/ECB-forced-to-step-in-to-calm-market-fears-over-Portugal.html
http://dailybail.com/home/citigroups-willem-buiter-savage-austerity-is-coming-soon-to.html
http://dailybail.com/home/william-buiter-says-bank-bondholders-must-be-held-accountabl.html
http://dailybail.com/home/when-the-big-banks-come-crawling-back-screw-em-talking-point.html
The pessimism doesn't come from the frustration of people not understanding this. It comes from the realization that EVERYONE understands it, including those sworn to protect the innocent--and yet they do not. And we cannot make them, whether we vote them out or not. They are captured the moment they are sworn in, if not before.
All in accordance with the "intellectual elite and world banker's" vision of the new global economic world order, a.k.a. the banking dictatorship's new normal.
They prey upon the weakness of a decadent society by fulfilling the fantasy of wealth without basis--sprung as a debt trap--then plot the left's rejection of American exceptionalism with the intentional dumbing down and Orwellian indoctrination of the "global citizen" generation.
It took several generations to fully engage this attack upon the working class--we're not going to reverse it with Keynesian Voodoo-nomics tomorrow. Not when the next generation is being groomed to accept it as a rite of passage into the warm embrace of global fascism:
http://letthemfail.us/archives/7108
wil i will take a look at your article...
He does not EVER question the EU project as a whole, nor provate central banks and private central bankers (he was/*is* one, after all ! ) -
He works for one of the biggest "Zombie Banks" on the planet - Citigroup - Rockefeller etc. behind it...
The EU - whose existence and raison d'etre he never questions, is essentially a criminal organizayion, due to the fact that its own auditors have not signed off on its accounts for the past fourteen years (Google Christopher Story) - no other corporation or entity behaving that way would be allowed to continue operating...
That's enough right there.
Nation states must reassert and LIVE their sovereignty, and create their own debt-free money/currency.