Last week it was exactly 45 years ago that president Nixon took the United States off the gold standard. At the time the Federal Reserve lost lots of gold after the Fed itself eased monetary conditions to help finance the Vietnam war. Ever since we live under a fiat money regime, or a PhD standard as Jim Grant calls it because the value of our money (its purchasing power) no longer depends on gold, but on the whims and fancies of a handful of academics. What did this PhD-standard bring us?... »

Stress tests are a phenomenon that should raise questions directly: a banking regulator that conducts a publicly accessible stress test on bank´s financial statements. What incentive does a regulator have to see half of the banks it regulates fail? This façade has one objective: to increase trust in the banking sector. Unfortunately, the latest stress test last month turned out to be one miserable failure. “Only” three banks failed to pass the EU stress test: Banca Monte dei Paschi, Royal

The Japanese central bank, the Bank of Japan, has reached a point at which it has two options left: (a) make monetary policy even more extreme, with helicopter money, or (b) conclude that their Keynesian solution of loose, looser, loosest monetary policy has failed. Last week, Haruhiko Kuroda announced that the Bank of Japan will buy more ETF’s (yes, more, the Bank of Japan already buys index funds) and lend more dollars to Japanese companies with overseas business (yes, the Bank of Japan was also already doing that). But the market wanted helicopter money. The result? The Japanese yen strengthened almost 2% against the dollar. In other words, Kuroda will have no choice at his next policy meeting: either implement helicopter money and make his extreme monetary policy even more extreme,