Readers, this a very long article, it is also very comprehensive. However, I see at least two flaws one minor and one very major. First the author doesn't seem to understand the variety of derivative financial instruments and describes all derivatives as "insurance policies." The Credit Default Swaps were clearly a deregulated variety of insurance. The rest of the derivatives provided a false sense of reduced risk by the pooling of different specific assets, and by the fraud of the ratings agencies choosing to fraudulently rate the tranched products.

While most of the world’s press focuses on Greece (and also Spain, Ireland and Portugal) as the most troubled euro-areas, the much more severe, more devastating and downright deadly crisis in the post-Soviet economies scheduled to join the Eurozone somehow has escaped widespread notice.

Forget the bonuses. Sure, it is disgusting that Wall Street is funneling government bail-out funds straight to what my colleague Bill Black calls the "control frauds"—the top managers of financial institutions. And, yes, they are blowing the black hole of financial insolvency bigger day by day even as they thumb their noses at Washington while Timmy Geithner and Ben Bernanke look the other way. But what is even more disturbing is that Wall Street is still maniacally creating risk, inventing new ways to bet on the death of "peasants", economies, and nations.

Readers, this article doesn't really provide much new in the way of analysis for those who have followed the process and particularly from an institutional economics perspective. That Jane D'Arista has been used for her input is substantial by her having been an economist for the US Congress for twenty years and the author of the book "The Evolution of US Finance." The other aspect is that this article appeared in the Christian Science Monitor which has had a fairly conservative perspective. Admin

Readers, please, note the prominent and repeating role of credit default swaps in the whole process. This alone application makes the whole process less about real economy than a casino of fictions. It is in this decoupling that banking established its primacy. There are also relics of the era of specie based monetary policies through the privatization of money. To put it another way this is dysfunctional finance gone wild. Admin

Readers, this is one of the better short analyses of monetary policies from the chartalist perspective. Much of the way issues about public financing are posed are antiquated and date to the era when currency was specie based(aka on precious metals). Because governments are the sovereign originators of money its accounting and debt process is actually much different than how ordinary households relate to debit and credits. There are more thorough treatments of the topic, and this works well as an introduction. Admin.

Readers, this is a fairly basic and comprehensive article. There have been complaints about the sometimes abstract and difficult level of the postings. There needs to be entry point material as well as the more advanced material. The bottom line part of the process is that people need to find their own entry point and then keep exploring and reading. In time you will understand the larger patterns and historical developments. Admin

http://bostonreview.net/BR35.1/baker.php

As the Financial Crisis Inquiry Commission begins looking at the causes of the recent financial crisis, we need to consider that crisis is a failure of governance. Lucian Bebchuk from Harvard Law School has written extensively on the failure of private sector governance: boards that failed to make informed judgments or control the risks incurred by their institutions, self-serving management that lost control over reckless risk taking and compensation systems that invited speculation by traders.

Readers, this is an excellent interview which references to several articles which have already been posted to this site. The analysis is impeccable, in my opinion, and is based upon results and historical data. As such, it is way better that most of the wishful thinking pretending to be economics. This also comes out of the institutional economics discourse. Admin.

Part I: How Much More “Debt Recovery” can the Economy Take?