Libra: economics of Facebook’s cryptocurrency

Facebook last week announced plans for Libra, a new global cryptocurrency. The name seems to be a marriage of the words “livre”, the French currency throughout the Middle Ages based on a pound of silver, and “liber,” which is Latin for “free.” Facebook claims that Libra will give the freedom to easily transmit funds across borders to the 1.7 billion adults in the world without access to traditional banks.
Continue reading

37 Years Ago Today: “It’s because of you little motherf*****s that we’re out of work!”

On this day, in 1982,  at the height of the hysteria focused on competition from Japan, two unemployed auto workers chased down Vincent Chin — celebrating his bachelor’s party — and beat him senseless with a baseball bat (he subsequently died from his injuries). As we re-establish Camp Sill as an internment/detention/concentration camp (you pick the term), and the deportation campaign — real or imagined — is announced, it’s perhaps time to recall the warning signs:

In context:

Continue reading

“Trump revs up his Wayback Machine”

From Ben White in Politico today:

President Donald Trump is firing up his economic Wayback Machine in an effort to boost markets, the economy and his own political fortunes heading into his reelection campaign.

Economists warn that Trump’s approach, with its roots in 19th century mercantilism and 1980s Reaganism, risks back-firing on him in potentially significant ways.

Continue reading

“Seattle’s Chinese American veterans to receive long overdue honor from U.S.”

I saw this Seattle Times article while visiting my hometown, and it struck me as relevant, as the Trump administration is now deporting veterans, willy nilly. From the article.

When the [Second World] war began, the United States government had not yet repealed the Chinese Exclusion Act of 1882, the nation’s first immigration ban on a specific ethnic group. The law severely limited Chinese immigrants from entering the country and becoming naturalized citizens for more than 60 years, until the end of 1943.

This meant that while up to 20,000 Chinese Americans served in the military during World War II, about 40% were not even granted citizenship, according to the Chinese-American World War II Veteran Congressional Gold Medal Act.

Continue reading

Down, Down, Down: 10 Year Yields in Advanced Countries

Perusing the last issue of the Economist, I noted that among advanced economies, only Greece (180 bps), Spain (87 bps), Australia (133 bps), South Korea (112 bps) and Chile (108 bps) had larger declines in the ten year yields than the US (81 bps).

Of these, one could argue Greece and Spain declines were attributable to a decline in default risk, leaving only Australia, South Korea and Chile.

Figure 1 below illustrates what has happened to 10yr-3mo, 10yr-2yr and 5yr-3mo spreads over the past year (indicated by vertical green line)