European Commission, (2018), “Brexit Negotiations: What is in the Withdrawal Agreement”, 14 November The European Commission and the United Kingdom’s negotiators have reached an agreement on the entirety of the Withdrawal Agreement of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community, as provided for under Article 50 of the Treaty on European Union. The Withdrawal Agreement establishes the terms …Read More
May’s Brexit Deal Is Not the Answer
Editorial Board of Bloomberg, (2018), “May’s Brexit Deal Is Not the Answer”, Bloomberg, 15 November U.K. Prime Minister Theresa May announced Wednesday that she has secured her cabinet’s support for her plan to leave the European Union. The choice now, she said, is her deal, “or leave with no deal, or no Brexit at all.” Put that way, the right choice — the only sane choice — is more obvious than …Read More
When the Next Recession Hits: A User’s Guide for Future QE
Joseph E. Gagnon, (2018), “When the Next Recession Hits: A User’s Guide for Future QE”, Peterson Institute for International Economics, 14 November The global financial crisis of a decade ago pushed economies into deep recessions. To prevent these recessions from becoming depressions, several major central banks made large-scale purchases of long-term bonds and other financial assets to ease financial conditions and support spending.[1] These actions, known as quantitative easing (QE), were …Read More
The Punk Rock Life Is No Place for the ECB
Ferdinando Giugliano, (2018), “The Punk Rock Life Is No Place for the ECB”, Bloomberg Opinion, 15 November The ECB should pay very close attention to how any new data or market moves that come in before its next meeting, on Dec. 13, change the outlook for prices. Even then, it is very hard to see officials reneging on their guidance that they will end quantitative easing in December: The ECB launched …Read More
Greek Banks Inch Toward Bad-Loan Relief With Complex Plans
Nikos Chrysoloras, Tom Beardsworth, Christos Ziotis, and Sotiris Nikas, (2018), “Greek Banks Inch Toward Bad-Loan Relief With Complex Plans”, Bloomberg, 13 November Greek authorities are moving forward with two different plans to save their banks from a downward spiral. Some would-be investors think they’re too clever by half. To reduce non-performing loans, the Greek central bank is proposing a special-purpose vehicle created with the stricken lenders’ tax credits — themselves an …Read More
Inflation expectations, consumption and the lower bound: micro evidence from a large euro area survey
Ioana A. Duca, Geoff Kenny, Andreas Reuter, (2018), “Inflation expectations, consumption and the lower bound: micro evidence from a large euro area survey”, ECB Working Paper Series, No. 2196, November This paper exploits a very large multi-country survey of consumers to investigate empirically the relationship between inflation expectations and consumer spending. We document that for the Euro Area and almost all of its constituent countries this relationship is generally positive: a higher expected change …Read More
Italy Gets Starvation Rations From Mario Draghi
Marcus Answorth, (2018), “Italy Gets Starvation Rations From Mario Draghi”, Bloomber Opinion, 12 November What could the European Central Bank realistically do to help Italy, even if it were so minded? Not much, is the depressing answer — in specific new aid anyway. That’s unless Italy ends up getting itself in such a mess that it’s forced to hand over financial control and enter into another ECB bailout program. We’re nowhere …Read More
Lessons from the 2000–2002 Crisis in Argentina for the Sustainability of the Euro
Jeromin Zettelmeyer, (2018), “Lessons from the 2000–2002 Crisis in Argentina for the Sustainability of the Euro”, Peterson Institute for International Economics, 30 September n December of 2001, after two years of recession and increasingly desperate attempts to forestall a debt crisis through IMF financial support, fiscal adjustment and debt management operations, Argentina defaulted on its external debt. A few days later, on 2 January 2002, it discontinued its “convertibility regime” …Read More
Political Science and the Eurozone Crisis. A Review of Scientific Journal Articles 2004–15*
Oliver Höing and Tobias Kunstein, “Political Science and the Eurozone Crisis. A Review of Scientific Journal Articles 2004–15”, Journal of Common Market Studies, September We take a closer look at how political science engaged with Economic and Monetary Union (EMU) over a period of 12 years (2004–15). How intensively, and with what focus, have political science journals dealt with EMU? How has the scientific discourse on the topic changed with the …Read More
Regional Economic Outlook: Domestic Expansion Running into External Turbulence
IMF, (2018), “Regional Economic Outlook: Domestic Expansion Running into External Turbulence”, World Economic and Financial Surveys, November Economic activity continued to expand in the first half of 2018, albeit at a slower-than-expected pace, mainly in advanced Europe. Domestic demand, supported by stronger employment and wages, remains the main engine of growth. However, the external environment has become less supportive and is expected to soften further in 2019 owing to slowing global …Read More