Kenneth, T. (2014) “The German euro is overvalued“, US/ Global Economics, Angry Bear Blog, 02 Δεκεμβρίου. I keep telling people that the German euro is undervalued, but some folks seem not to believe me. (See the comments section from this post last year for an example.) But this is a really big deal. The dominant narrative about the eurozone crisis is that fiscally irresponsible countries like Greece were bringing …Read More
Smith, Y. (2014) “Germany and the European Commission’s €315 Billion Infrastructure “New Deal” is Yet More Smoke and Mirrors“, Naked Capitalism Blog, 26 Νοεμβρίου. I have to confess I had not taken the announcement of a €315 billion infrastructure spending program by the European Commission all that seriously, despite the fact that this on the surface represented a very serious departure from the Troika’s antipathy for anything resembling fiscal …Read More
Bastian, J. (2014) “Is there (sustainable) growth in Greece?“, MacroPolis: Greece in Perspective, 19 Νοεμβρίου. Greece finally exited its six-year long recession in the third quarter of 2014. The Hellenic Statistical Authority ELSTAT said that the economy grew by 0.7 percent in the third quarter (compared to the same quarter in 2013). The positive third quarter reading is the first after 24 consecutive quarters of negative GDP performance dating …Read More
Goldstein, M. (2014) “The 2014 EU-wide bank stress test lacks credibility“, VoxEU Organisation, 18 Νοεμβρίου. Results from last month’s EU-wide stress test are reassuring, especially for countries at Europe’s core. This column warns against a rosy interpretation. The test relies on risk-weighted measures of bank capital ratios that have been shown to be less predictive of bank failure than unweighted leverage ratios – a metric already adopted by the …Read More
Turner, A. (2014) “Germany’s Secret Credit Addiction“, Project Syndicate, 10 Νοεμβρίου. With recent data showing that German exports fell 5.8% from July to August, and that industrial production shrank by 4%, it has become clear that the country’s unsustainable credit-fueled expansion is ending. But frugal Germans typically do not see it that way. After all, German household and company debt has fallen as a share of GDP for 15 …Read More
Muellbauer, J. (2014) “Quantitative Easing for the People“, Project Syndicate, 05 Νοεμβρίου. It is now a near certainty that, by the end of this year, falling energy and commodity prices will push annual inflation in the Eurozone below zero – well under the European Central Bank’s target of near 2%. Rather than continue to allow misguided conventional thinking, centered on German economic ideology, to impede effective action, the ECB …Read More
The Editors (2014) “What’s Bad for Germany Could Be Good for Europe“, Bloomberg View, 04 Noεμβρίου. Even those familiar with Europe’s plight will find the latest economic forecasts grim reading. You thought the outlook for the euro area was bad already. It’s getting worse, says the European Commission. That said, Europe works in mysterious ways. In this deepening pessimism, there might just be grounds for optimism. The projections make …Read More
Gilbert, Μ. (2014) “ECB Needs Japanese Lessons“, Bloomberg View, 05 Νοεμβρίου. Economists like to warn about Japanification, the risk that a country will follow the desultory experience of Japan, which slumped into deflation in 1999 and for all intents never climbed out. As Europe slides closer to deflation, the European Central Bank should heed the historical experience and the current efforts by the Bank of Japan to resuscitate growth. …Read More
Roubini, N. (2014) “The Single-Engine Global Economy“, Social Europe Journal, 04 Νοεμβρίου. The global economy is like a jetliner that needs all of its engines operational to take off and steer clear of clouds and storms. Unfortunately, only one of its four engines is functioning properly: the Anglosphere (the United States and its close cousin, the United Kingdom). The second engine – the eurozone – has now stalled after …Read More
Foroohar, R. (2014) “Where the Next Financial Crisis Will Come From“, Time Magazine, 03 Νοεμβρίου. The next financial crisis won’t come from the banking sector. That’s the message implicit in the latest report on the global financial sector from the Financial Stability Board, the group that monitors what’s happening with the world’s money flow. Instead, it’s very likely to come from the massive and growing “shadow banking” sector—an area …Read More
