dunnettreader + bank_of_england   15

Quaker bankers: building trust on the basis of sincerity, reciprocity and charity | Magic, Maths & Money - Feb 2016
This post follows discussions of the norms sincerity, reciprocity and charity in financial markets. It suggests that the success of Quaker finance, that funded… Tracks the importance of Quaker-owned banks to the development of UK financial system - the number of big-name banking families with Quaker founders is striking. Their personalized methods of working on reputation (theirs and their borrowers) based on shared standards of probity and transparency, disciplined by membership in the Quaker community - allowed them to not only grow in the loan business, but become big in the bills market. The Quaker method of collecting views re appropriate moral life practices, which were documented and circulated among the members - and set mutual expectations for ethical practices, including areas like bookkeeping and full disclosure. The Quaker firms were central to the system of country banks, capable of providing liquidity to halt bank runs, wind down problem institutions etc. Their bills business didn't survive the switch to the Bank of England becoming lender of last resort in the 1844 crisis. And their information advantages don't seem to have remained a competitive advantage as it had been in the pre Napoleonic_Wars era.
Instapaper  economic_history  financial_innovation  banking  17thC  18thC  19thC  British_history  Quakers  dissenters  Industrial_Revolution  ethics  norms  norms-business  accounting  accountability  reputation  disclosure  information-intermediaries  information-markets  money_market  Bank_of_England  country_banks  financial_crisis  bank_runs  lender-of-last-resort  from instapaper
february 2016 by dunnettreader
Policy Statement - The implementation of ring-fencing: legal structure, governance and the continuity of services and facilities | Bank of England – PS10/15 - May 2015
The Prudential Regulation Authority is required under the Financial Services and Markets Act 2000 (as amended by the Financial Services (Banking Reform) Act 2013) to make policy to implement the ring-fencing of core UK financial services and activities. This policy statement will be of interest to banks which will be required to ring-fence their core activities. This will include banking groups with core deposits greater than £25 billion. It will also be of interest to financial and other institutions and customers who have dealings with ring-fenced bodies. The policy statement provides feedback on the responses received to Consultation Paper 19/14 published in October 2014, and the amendments to the draft rules and supervisory statements included in CP19/14. The policy statement covers three areas: (1) legal structure arrangements of banking groups subject to ring-fencing; (2) governance arrangements of ring-fenced bodies; and (3) arrangements to ensure continuity of services and facilities to ring-fenced bodies. -- plan for effective date in 2019 -- didn't download
public_policy  financial_regulation  Bank_of_England  banking  deposit_insurance  bank_runs  bank_holding_cos  corporate_governance  too-big-to-fail 
may 2015 by dunnettreader
Eric Rauchway, review - Martin Wolf, The Shifts and the Shocks (2014) | TLS Jan 2015
... his analysis, which holds that we knew how to avoid, counter and cure these troubles; we have simply – largely out of wilful ignorance and lack of courage – failed to do more than the barest minimum of what was necessary. Governments, banks and international institutions did “just enough, almost too late” to prevent the worst possible result, which would have been a note-for-note replay of the 1930s including a slide into fascism and world war. But having done no more than avoid world-historic catastrophe, we find ourselves mired in a dim morass of our own making, with no sunlit uplands in sight. Wolf offers a persuasive account that is also clear, though he relies on no single factor but several: hence the title of the book. It took both long-term shifts and a series of shocks to cause a crisis of such magnitude. Our world was born in the end of the Cold War. With capitalism triumphant, the victors liberalized their economies and so did the Communist nations, particularly China. Yet all was not well in this brave new world; international finance and trade threatened the stability of smaller, emerging economies, as the crises of the 1990s demonstrated.
financialization  bad_history  shadow  banking  Pocket  risk  global  economy  money  markets  global_imbalance  keynesian  business_influence  bad_economics  books  financial_regulation  liquidity  deregulation  minsky  investment  economic_growth  reviews  fed  Bank_of_England  great_recession  us_politics  leverage  capital_flows  race-to-the-bottom  business  ethics  political_economy  ecb  rents  uk  central_banks  investors  financial  crisis  financial_system  austerity  capital  economic_theory  us_economy  eurozone 
january 2015 by dunnettreader
John Wells and Douglas Wills - Revolution, Restoration, and Debt Repudiation: The Jacobite Threat to England's Institutions and Economic Growth | JSTOR: The Journal of Economic History, Vol. 60, No. 2 (Jun., 2000), pp. 418-441
This study provides an empirical test of North and Weingast's theory of British capital-market development after the Glorious Revolution. The evidence is consistent with the hypotheses that institutional innovation in the 1690s led to the dramatic growth in London capital markets, and that threats to these institutions caused financial turmoil. We also find the economic motivation for these innovations to be consistent with the work of Ekelund and Tollison. -- they fell for Whig propaganda
article  jstor  economic_history  finance_capital  17thC  18thC  British_politics  North-Weingast  Jacobites  sovereign_debt  interest_rates  institutional_economics  public_choice  interest_groups  Whigs-oligarchy  Bank_of_England  Tories  Hanoverian_Succession  James_III  monied_interest  downloaded  EF-add 
january 2014 by dunnettreader
Editors - If It Looks Like a Bank, Regulate It Like a Bank - Bloomberg
Money-market mutual funds, for example, could become special-purpose “narrow” banks, as proposed in a 2010 paper by Yale University economists Gary Gorton and Andrew Metrick. The same goes for entities that borrow short-term to invest in asset-backed securities -- the so-called structured investment vehicles and conduits that were the first to suffer runs in the last crisis.

As for hedge funds and other institutions that would remain in the shadows, minimum requirements for haircuts -- combined with proper capital rules for the regulated banks that often lend to them -- should suffice to keep leverage from getting out of control. The Financial Stability Board, an international group of regulators, has proposed a set of global minimum haircuts that individual countries would do well to build upon. There’s ample evidence that extreme leverage presents a threat to markets and the economy -- and zero evidence that it provides any benefits.
financial_system  financial_regulation  financial_crisis  banking  shadow_banking  Bank_of_England  EF-add 
november 2013 by dunnettreader
Paul Krugman - Three Centuries of Debt and Interest Rates - NYTimes.com Oct 2013
Aha — somehow I didn’t know this existed. The Bank of England has produced some very, very long-term series; spreadsheet can be downloaded here. Here’s debt and interest rates since the Bank was founded: - chart from BoE Quarterly Bulletin paper (2010 Q4) - pdf downloaded - see pinboard bookmark
economic_history  Britain  UK_economy  sovereign_debt  interest_rates  capital_markets  18thC  19thC  20thC  Great_Recession  21stC  Bank_of_England 
october 2013 by dunnettreader
Sally Hills and Ryland Thomas: The UK recession in context — what do three centuries of data tell us? - Bank of England | Quarterly Bulletin 2010 Q4
From the TOC for 4thQ 2010 bulletin - Pdf downloaded - see Krugman as source of link - The UK recession in context — what do three centuries of data tell us? (178k)
By Sally Hills and Ryland Thomas of the Bank's Monetary Assessment and Strategy Division and Nicholas Dimsdale of The Queen's College, Oxford.
The Quarterly Bulletin has a long tradition of using historical data to help analyse the latest developments in the UK economy. To mark the Bulletin's 50th anniversary, this article places the recent UK recession in a long-run historical context. It draws on the extensive literature on UK economic history and analyses a wide range of macroeconomic and financial data going back to the 18th century. The UK economy has undergone major structural change over this period but such historical comparisons can provide lessons for the current economic situation.
The data annex is available in Excel format (575k).
economic_history  Britain  UK_economy  sovereign_debt  interest_rates  18thC  19thC  20thC  21stC  Great_Recession  Bank_of_England  capital_markets  downloaded 
october 2013 by dunnettreader
D'Maris Coffman: Bringing History to Economics | The Institute for New Economic Thinking
This episode features grantee D’Maris Coffman of the Centre for Financial History talking about her organization’s commitment to a New Financial History and what the fruits of their approach can tell us about modern debt crises and sustainable debt levels. She also discusses her research, funded by the Institute for New Economic Thinking, which explores fundamental questions about how Britain averted a Malthusian trap in the early nineteenth century and why the answers matter for global food security today.

our research into the “Credible Commitment” thesis has yielded three key findings. One that political risk is the most important single determinate of sovereign risk. Two, that the willingness of one party to honor the other party’s commitments is essential, and thus 1710 (when the Tories honored Whig commitments) was more of a turning-point than 1688-89. And three, that rather than crowding out the private sector, public sector spending and a coercive and authoritarian fiscal system paid for public borrowing during the Napoleonic wars.

These findings show that that gridlock in Washington is the “worst sort of politics possible.” Indeed, it is my firmly held belief that our research will overturn the relatively glib heuristics proposed by Carmen Reinert and Kenneth Rogoff.
video  books  kindle-available  economic_history  institutional_economics  North-Weingast  sovereign_debt  economic_growth  development  Tories  Whigs  Whig_Junto  Bank_of_England  1710s  Harley  Bolingbroke  EF-add 
october 2013 by dunnettreader
Crisis Chronicles: The “Not So Great” Re-Coinage of 1696 - Liberty Street Economics Sept 2013
During the Commission’s debates, many solutions to the crisis were proposed: Treasury Secretary William Lowndes favored devaluation, Treasury advisor Charles Davenant advocated the expansion of credit, and Royal Mint Master Sir Isaac Newton sought to achieve gold and silver mint price parity. Ultimately, a plan to demonetize the existing clipped coins and issue new, full-weight coins—put forward by Commission member and prominent philosopher John Locke—was approved. -- . While the milled-edge design used in the re-coinage prevented further coin clipping, it didn’t address the ongoing attack on silver coinage by seventeenth-century arbitrageurs and the continuing silver outflows. These problems resulted in depositors flocking to the Bank of England on May 4 to demand specie. By May 6, the Bank of England was forced to forestall debt payments, and it was not able to resume payments until October, when it received a loan from the Dutch government.

In the second half of 1696, England’s economy essentially stopped, and the ensuing monetary contraction led to massive unemployment, poverty, and civil unrest.
economic_history  17thC  British_history  currency  monetary_policy  Locke  Newton  Bank_of_England  capital_flows  EF-add 
october 2013 by dunnettreader
Matias Vernengo: Crowding out and the Industrial Revolution July 2013 | NAKED KEYNESIANISM
Charts from Dickson re interest rates on UK bonds through 18thC and the interest rates spikes during War of Spanish Succession -- links to classic studies (JSTOR) estimating slower growth during 18thC and speculating on crowding out. Link to McColloch paper disputing that Bubble Act reduced industrial investment in 18thC. Vernengo doesn't mention either usury controls or, more important for his speculation that finance for investment grew only as demand grew, that Britain was most heavily taxed and relied increasingly on consumption taxes that would have an impact on growth of demand. Temin and Voth theory that focuses on banking, and less on capital markets (do they think Bubble Act was important? ), other than relations between banking system and sovereign debt market. Vernengo cites papers (including from 1950s) that see Bank of England providing liquidity to the whole system especially in 2nd half of 18thC through the expansion of the revenue collection and government spending process -- new country banks also collecting taxes and the government was spending large amounts on war. Vernengo mentions that in earlier post on same topic and McColloch paper. JSTOR papers are downloaded to Note
paper  article  jstor  links  political_economy  economic_history  18thC  Britain  public_finance  sovereign_debt  fiscal-military_state  fiscal_policy  taxes  interest_rates  Bubble_Act  Bank_of_England  economic_growth  investment  financial_regulation  banking  War_of_Spanish_Succession  Industrial_Revolution  crowding_out  financial_repression  EF-add 
september 2013 by dunnettreader
Bruce G. Carruthers: Homo Economicus and Homo Politicus: Non-Economic Rationality in the Early 18th Century London Stock Market (1994)
JSTOR: Acta Sociologica, Vol. 37, No. 2 (1994), pp. 165-194 -- downloaded pdf to Note -- big bibliography including political history on Whig and Tory fights, funding the War of Spanish Succession and so forth - amazing this paper isn't cited in all the institutional_economics stuff done on this period -- The case of the early 18th-century London stock market is used to evaluate economic and sociological theories of market trading. Data from 1712 on shares in two companies (the Bank of England and the East India Company), and on trading among three different groups (political parties, ethnic-religious groups, and guilds) are used to show how economic theories of rational trading do not account for market behavior, even though the 1712 London stock market was a highly centralized, organized and active capital market. Trading was embedded in domestic and international politics as party groups used the market to control joint-stock companies, and as ethnic-religious groups used the market to provide financial support for Britain's war with France. In addition to economic goals, political goals were pursued in the market.
article  jstor  18thC  1710s  British_politics  capital_markets  political_economy  Harley  Bolingbroke  Whig_Junto  Tories  War_of_Spanish_Succession  Peace_of_Utrecht  Bank_of_England  East_India_Company  public_finance  sovereign_debt  downloaded  EF-add 
september 2013 by dunnettreader

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