Axel Merk and Michael Hudson – The pros and cons of the ECB’s quantitative easing and Ukraine’s bailout
from Boom Bust Well, it’s a great time to be a Wall street banker. Their pockets are a little bit thicker these days – the average bonus in the securities industry actually rose two percent in 2014 to almost $173,000. And that’s the highest it’s been since 2007 pre-financial crisis, when the bonus was at about $178,000. What’s so interesting about this is that bankers are seeing this raise despite the fact that Wall Street profits actually fell last year. Boom Bust guest host Ameera David weighs in. Then, Boom Bust producer Edward Harrison is joined by Axel Merk – president and CIO of Merk Investments. Axel tells us why Germany benefits the most from quantitative easing and a weak euro. He also gives us his take on how QE will affect yields in Europe, small and medium-sized business, and the general real economy. Axel also weighs in on Europe’s new bail-in policy now being implemented in Austria with the bankrupt Hypo Alpe Aldria bank and its toxic loan portfolio, called Heta. After the break, Edward sits down with Michael Hudson – distinguished research professor of economics at the University of Missouri, Kansas City. Michael tells us about the dire economic situation in Ukraine and who else besides the IMF can provide the country with funds. He characterizes the loans being provided to Ukraine as an exercise in looting that will not benefit the average Ukrainian, but result in an asset grab that benefits the select few. And in The Big Deal, Ameera and Edward continue the discussion on Wall Street bonuses in a discussion about whether the high level of bonuses are a contrarian indicator that presages a top of the US stock market. They also discuss increased corporate stock repurchase activity as another potential contrarian indicator, with special focus on GM’s new $5 billion share buyback program.