This post first appeared on May 8, 2007 The debate among Serious Economists about the benefits of free trade continues, and Dani Rodrik continues to take a dispassionate look at the data and the models. This post, although a bit geeky, is intriguing because Rodrik dissects an analysis cited by Bernanke in a recent speech, […]
Read more...Back in January, the preposterous projected 99-year return on this Green Oil caught my eye; it reminded me of an ostrich scam a few years back, under which, if you took it literally, the entire surface of the world would have been carpeted with ostriches rather quickly; to the great enrichment of all, naturally. Then […]
Read more...If you have any doubts about how easy it is for someone who works hard in the US to get ahead, consider this factoid from Martin Wolf’s latest comment in the Financial Times, on Raghuram Rajan’s new book (see Satyajit Das’ review here: Thus, Prof Rajan notes that “of every dollar of real income growth […]
Read more...Satyajit Das is too shrewd to call the European Financial Stability Facility, informally described as a €440 billion sovereign bailout fund, a mere sleight of hand. But it’s hard not to draw that conclusion after reading his Financial Times comment today. Central banks and governments have developed an alarming fondness for the very sort of […]
Read more...The reporting so far is thin, just notices of the announcement at Bloomberg and the Wall Street Journal that Moody’s cut the rating on Portugal’s sovereign debt from Aa2 to A1. The Bloomberg headline notes that Moody’s put the outlook as stable, while the Journal pointed out that the agency expected “Portuguese government’s financial strength […]
Read more...Der Spiegel (hat tip reader Richard Smith) presents a detailed sketch of German thinking, specifically that of chancellor Angela Merkel and finance minister Wolfgang Schäuble, regarding how countries who fail an initial round of restructuring within the eurozone would be treated. This piece is very much worth reading, but the German proposal has all the […]
Read more...I sometimes wonder whether Wolfgang Munchau of the Financial Times and Ambrose Evans-Pritchard of the Telegraph channel each other. Although they are both dubious of the eurozone’s ability to navigate its way out of its current mess, they also have an interesting habit of taking up similar issues on the same publication date. Today, both […]
Read more...By Kati Suominen, Trans-Atlantic Fellow at the German Marshall Fund in Washington, cross posted from VoxEU The global crisis has led some to question the dollar’s place as the dominant currency. This column discusses three camps in the literature: those advocating a new synthetic global currency, those arguing that a new reserve currency will emerge, […]
Read more...The New York Review of Books has an article by George Soros with his take on the challenges facing the Eurozone. It includes a good, high level recitation of the structural deficiencies in the Eurozone (in particular, its lack of a treasury), the evolution of recent stresses, and suggested remedies. While the initial discussion covers […]
Read more...Look, I love the Financial Times, but even the pink paper has its off moments. Today, the FT reports, with the journalistic equivalent statement of a straight face, a patently ridiculous statement from China’s State Administration of Foreign Exchange: China has delivered a qualified vote of confidence in the dollar and US financial markets, ruling […]
Read more...By Willem Thorbecke, Senior Research Fellow at the Asian Development Bank Institute and a Consulting Fellow at Japan’s Research Institute of Economy, Trade, and Industry, originally posted at VoxEU Yves here. As we have pointed out in several posts, the idea that China’s announcement on its currency policy change is “abandoning its dollar peg” is […]
Read more...The alert John Dizard of the Financial Times has taken notice of a development that has passed most commentators by, namely, that Greece is starting to restructure state debts. This hasn’t yet gotten the attention it merits because it’s bonds issued by particular government bodies (in this case, the Greek state hospital system) and the […]
Read more...The stress tests conducted on 19 large American banks by the US Treasury in 2009 were an amazingly effective exercise in salesmanship and sleight of hand. Banking industry experts, including Bill Black, Chris Whalen, and Josh Rosner, dismissed the process as mere theatrics: too little staffing and not enough “stress” in the economic forecasts and […]
Read more...We and other cynics were very skeptical of the pre-G20 announcement by China that it was moving to a more market-oriented currency regime at some unspecified point in the future (particularly since China had said pretty much the same thing in 2005, and actually had committed to some baby steps then). Now that it is […]
Read more...We’ve warned for some time that the eurozone’s sure-to-fail muddle-through approach to its structural challenges was rattling investor confidence. Worse, its insistence on wearing an austerity hairshirt was not only committing Europe to deflation, but had high odds of sucking the global economy down along with it. Given how fragile the recovery is in advanced […]
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