I read in Wall Street Journal (Europe) this afternoon in Zurich that some eminent economists, close to the Republicans, would issue a signed letter opposing the Federal Reserve’s new 600 billion of Treasury Securities purchase programme. I was surprised to find, via Zerohedge, that such a letter has already been published by the Wall Street Journal (America?).
A brilliant post by Simon Johnson with the provocative title that Vikram Pandit has no clothes referred to a letter that has been issued by a bunch of US academics on why Basel III accord fails to address systemic risk posed by banks. Simple solution is to have banks fund more of their assets via equity than via debt. The authors of the letter propose 15%. The letter makes a lot of sense.
These are welcome developments in the US.