There’s no doubt about it. We’re living in interesting times, as the Chinese curse goes, and they won’t be going away any time soon. Most of us can’t afford to ignore what’s happening here. So, below, I have highlighted a number of blogs and podcasts that help make intelligent sense of this economic debacle. Here they go…
- Planet Money: NPR is doing a great job of covering the unwinding global economy. The Planet Money blog is a good read, and it includes an essential reading list. But the accompanying podcast is one that I follow regularly. It’s a must. And it’s generally entertaining. You can access it here: iTunes – Rss Feed – Web Site. (Note: the last episode is not the best example of what it’s usually about.)
- EconoTalk: EconTalk was voted “Best Podcast” in the 2008 Weblog Awards. Hosted by Russ Roberts (out of George Mason University), the show “features one-on-one discussions with an eclectic mix of authors, professors, Nobel Laureates, entrepreneurs, leaders of charities and businesses, and people on the street.” You can access the show via the following channels: iTunes – RSS Feed – Web Site.
- The Baseline Scenario: Dedicated to “explaining some of the key issues in the global economy and developing concrete policy proposals,” The Baseline Scenario is written, among others, by Simon Johnson, former chief economist of the International Monetary Fund, who is now a professor at the MIT Sloan School of Management. Although relatively young, the blog has received a fair amount of acclaim as the financial crisis has unfolded. You may want to particularly check out their collection of content called Financial Crisis for Beginners.
- Realtime Economic Issues Watch: Here, senior fellows of the Peterson Institute for International Economics (a think tank based in Washington) “discuss and debate their responses to global economic and financial developments as they occur each day and offer insights that others might overlook.” You will find some of the folks from the Peterson Institute also appearing on the podcasts and blogs mentioned elsewhere on this list. Find the RSS feed here.
- Paul Krugman: A Princeton University economist, a Nobel Prize Winner, a New York Times op-ed writer, Paul Krugman is blogging the global financial and economic crisis daily. It’s an opinion that you can’t afford to take lightly. You’ll also want to see his newly released book, The Return of Depression Economics and the Crisis of 2008.
- Economists’ Forum: Run by the Financial Times (UK), this blog brings together a large number of economists who offer a running commentary on the state of the fragile economy. The Wall Street Journal has its own real time blog here.
- Fallout: America’s Financial Crisis: Marketplace, the nightly radio program on public radio (iTunes – Feed), also hosts a blog that tracks the week’s top stories on America’s financial crisis.
- NewsHour with Jim Lehrer: The PBS nightly news program almost always includes an informative segment dedicated to the financial news of the day. The coverage, which typically includes interviews with experts, is excellent. You can download the podcast here: iTunes – Feed – Web Site
- The Becker-Posner Blog: While not updated as frequently as Krugman’s blog, The Becker-Posner blog is a great place to read the thoughts of two Nobel prize winning economists (Gary Decker and Richard Posner) discuss the current economic crisis. Thanks Bryce for the tip.
- This American Life: One of NPR’s beloved programs has offered some excellent coverage of the financial crisis. It started with a show called The Giant Pool of Money (May 2008), and it has since included a program called Another Frightening Show about the Economy (November 2008). Now there is a new one called Bad Bank, which explains what’s really happening in the trainwrecks that are banks. These programs were put together partly by members of the Planet Money podcast mentioned above.
Are we missing something good? Please let us know in the comments below…
While not as frequent as Krugman’s blog, The Becker-Posner blog is a great place to read the thoughts of two Nobel prize winning economists discuss the current economic crisis. You can find it here.
Planet Money is so great. For fans of that podcast here are three other solid, relevant podcasts and their links in iTunes (not sure what their site links are):
A great video podcast from Marketplace, called Whiteboard, gives concise visual descriptions of key concepts like “credit default swaps”:
A new one from PRI’s the World, called Global Economy, which is, at its title implies, dedicated to a world perspective on current financial issues:
A practical one from NYTimes, called Your Money. It’s obviously more personal finance focused, but they make it clear that their goal is to offer advice amid the craziness of the current macro-crisis:
Nice list with a couple that are new to me, thanks – would also add VOX Talks from
Not in Itunes but the site has an RSS feed at
Produced by the Centre for Economic Policy Research
Hi, I’m not saying these are all ideal for following the financial crisis, but I started (but nowhere near enough) to compile a pageflakes page for ones I was looking at during a recent financial visualization project:
Other ones which I have not put in there yet but read everyday are John Kay (on his website, separate from his FT column), Nathan’s Economic Edge, Anything Peaceful, EconTech,
I’d like to recommend CreditMattersBlog.com for its lively and informative discussions of, well, credit matters.
Hi, apologies, did some re-organising yesterday and forgot that I was changing links – pageflakes page is now – http://www.pageflakes.com/Nicolaa/25623485
but the best ones I have found on there are Paul Kedrosky, Paul Wilmott, Tim Harford for overall commentary and discussion too.
CynicusEconomicus for fantastic indepth analysis
USA’s FAST ECONOMIC RECOVERY IN 2 STEPS
Step 1 – STOP THE BAILOUTS and FIX THE BANKS
– Solve the loan problem.
– Solve the derivative problem.
– Reassemble whole loan mortgages
The U.S. economy is shrinking fast, because businesses cannot get loans that they need to operate normally. Banks and lenders already own $ billions in bad loans, and they are afraid to make new loans. The government gave $ billions in bailout money for banks to start lending, but banks hoard the money to save themselves.
Our financial system became untrustworthy, because it mixed $ billions in bad loans in with the good loans. Now, banks do not trust any of the loans, and the entire credit market stopped working.
The U.S. economy will continue to shrink until we untangle the loans. Once the bad loans are isolated, they can be fixed one at a time. Then trust will be restored. Credit will flow, and the economy will grow.
So far, our government is spending $ trillions on bailouts and pork projects, out of ignorance and political ideology. The real solution is much less expensive than that.
The USA has fixed this problem before, and it is not hard to fix again. This is how:
A) Start with the Resolution Trust Corporation (RTC), which the federal government setup to solve a Savings and Loan problem in the 1980s.
B) RTC buys up securitized mortgages and derivatives to reassemble whole mortgage loans.
1. “Securitized mortgages” are home loans that have been bundled into large groups and sold to investors. A group of about 4,000 mortgages can be “securitized” and sold just like a stock or bond. Investors like to buy groups of mortgages because they receive all the monthly house payments.
2. Some groups of securitized mortgages were subdivided into smaller pieces, called “derivatives.” However, both of the fancy names refer to mortgage loans.
3. The problem is that many bad loans (with no payments) got mixed in with good loans. That turned the all the securitized mortgages into bad investments, which are ruining our banks. It is a huge problem, and the government has to fix it, before our economy will recover.
4. Total securitized mortgage and derivative market is estimated at $1.3 Trillion by a Professor of Economics at Ohio State University. (Also see the graph from Deutsche Bank at “The Death of Securitized Mortgages” http://www.nakedcapitalism.com/2008/06/death-of-securitized-mortgages.html )
5. Government should buy up securitized mortgages and derivatives at the lowest market price, which is set via a reverse auction. (Google on “reverse auction”.)
6. Squatters, who sit on their mortgage derivatives, in order to extort big $ from the rest of the system, can be forced to sell. (Law is analogous to eminent domain, or sales forced on cybersquatters that registered the domain names of well-established companies.)
7. Government pays mortgage derivative squatters at market price set by previous reverse auctions, perhaps with a penalty to the squatters.
8. Sellers give up all rights. No new law there.
9. Banks, investors, and insurers now have cash instead of questionable mortgage loans and derivatives. So, the banking system is healthy with cash to lend.
10. Credit will flow, and the economy will grow.
C) Government reassembles whole loans from securitized mortgage components and derivatives.
D) Government sorts the newly reassembled whole loans (mortgages) into groups according to risk/quality.
1. Government uses traditional mortgage experts and guidelines to sort the home loans into quality groups, for example, a high quality group would include homeowners with 20% (or more) equity in their house at today’s market price; and house payments that are 25% (or less) of homeowners monthly income.
E) Government (RTC) sells the reassembled whole loans to traditional mortgage banks.
1. This solves the problem of renegotiating home loans with homeowners. Read on.
2. Law must be changed so that reassembled whole loan mortgages cannot be securitized into derivatives, again.
3. An important purpose is to reconnect each homeowner with his lender, and vice versa.
4. It eliminates incentive for mortgage lenders to make predatory and junk loans. If the loan fails, the lender is stuck with a bad loan.
5. Government recovers much of the $1.3 Trillion purchase cost, because government auctions off the reassembled mortgages.
6. The lower quality, more risky mortgages would fetch a lower price at auction.
7. Mortgage companies, that buy the risky loans, will have more room to negotiate with the homeowners.
8. Some homeowner negotiations will not succeed. Those homeowners will move into affordable rentals. (The government does not owe everyone a free house.)
9. Other renters would like to buy those empty homes at reduced market prices.
10. If the government gets stuck with some homes, the government could profit by selling the homes when the housing market recovers.
F) Insurers like AIG may be reorganized through bankruptcy.
1. Securitized mortgage pools never made business sense, unless they were protected by various insurance schemes.
2. Those insurance schemes always were a scam.
3. Insurance only works when most of the insured assets are never hit with a disaster. That is why flood insurance does not work very well. A major flood ruins all the buildings in a large area, all at the same time. So, the insurance company goes broke, and people that bought the insurance are not protected. That is the problem with securitized mortgage insurance. In an economic downturn, the “disaster” hits all the houses at the same time. Securitized mortgage insurance was doomed to fail, and the insurance companies went broke in 2009.
4. Companies that ran the insurance scam may have to go through bankruptcy.
5. Never ending government bailouts for insurers like AIG are just throwing good money after bad. So, stop the bailouts.
This plan is inexpensive, tried and true. It leaves the banks healthy, with cash to lend. It restores trust in the credit markets, so loans will be made. It reassembles mortgage derivatives into whole loans, and restarts traditional mortgage lending. People can get loans to buy homes. Credit will flow, and the economy will grow.*
Step 2 – STOP THE PORK and START THE RECOVERY
*The economy will grow if President Obama’s massive tax, borrow, and spending plans can be stopped, before he creates another Great Depression. Presidents Hoover and Roosevelt already tried to tax, borrow and spend their way out of a recession in the 1930s. Instead, they created the Great Depression, which lasted 12 years. Straight as he goes, President Obama is doing it, again. Nevertheless, cleaning up the securitized mortgage mess is a necessary first step.
If President Obama announced Steps 1 and 2, today, the stock market would go up within hours. Investors love a real business plan, instead of a political pork plan. Millions of people will be wealthier, feel wealthier, and have more money to spend. That will jump start the economic recovery within days.
Great article like this require readers to think as they read. I took my time when going through the points made in this article. I agree with much this information.