There is an ongoing discussion on whether Germany is underinvesting and whether it could do more to increase its growth through investment. An analysis of recent trends produced by Roubini (subscription only; referenced today in Bloomberg) shows that German investment is low when measured against its current ability to invest, and is unlikely to significantly [...]
It is hard to think of a website so loved by its followers and so scorned by economists as John Williams’ ShadowStats, a widely cited source of alternative economic data on inflation and other economic indicators. Any econ blogger who has ever written a line about inflation is familiar with ShadowStats. Time and again, readers [...]
The announcements by several European governments that they would join the new Asian Infrastructure Investment Bank (AIIB) have been widely seen as indicators of the declining position of the U.S. The AIIB had been proposed by China for the purpose of funding much-needed infrastructure projects in Asian countries. The U.S. had discouraged other governments from joining, ostensibly [...]
The Impact of ECB QE
The ECB is using the most powerful weapon in its armory and Europe is now in uncharted waters.
No solution is in sight for the Greek crisis. And while the EU and most of the Greek people do not want a breakup from the Eurozone, Greece and its partners should realize that they are at a dead end and that the time has come for them to consider bold alternatives, including a consensual [...]
QE experiments so far have shown no significant impact on aggregate demand and consumer price inflation: QE has no way to funnel money to those who are most inclined to spend it.