The New Economic Nationalism, Part 2: The New Great Game

Commentators often assume that relatively unfettered trade in goods and services and free movement of capital are givens, but the drive toward greater economic openness could now be undergoing a reversal, with profound implications for the global economy. This piece, picking up from where Part 1 left off, looks how different countries may adapt to this […]

The New Economic Nationalism, Part 1: A ‘Juche’ World

Commentators often assume that relatively unfettered trade in goods and services and free movement of capital are givens, but the drive toward greater economic openness could now be undergoing a reversal, with profound implications for the global economy. This piece, the first of a two-part series, looks at the drivers of this shift. Globalization reached […]

It’s the Exchange Rate, Stupid

Eurostat released trade figures today, where the trade balance (exports less imports) surged €3.7 bn in the month of June (link to the .pdf release). The current figures imply a 2012 annualized trade balance of €66.9 bn, which is a meaningful boost to the -€7.4 bn deficit in 2011. Eurostat breaks down the regional figures further into intra-Euro […]

All of the Euro Area Usual Competitiveness Suspects in One Chart…But with a Twist

The European Commission’s Economic and Financial Affairs initiated the Macroeconomic Imbalance Procedure (MIP) Scoreboard. MIB will be used to identify emerging or persistent macroeconomic imbalances in a country. In their inaugural release, EU found 12 countries in need of further review for potential imbalances (program countries are exempted from this review process). The accompanying database […]

EA Infernal Devaluation Progressing

The EU answer to rebalancing portfolio and trade flows within the Euro area (EA) without currency devaluation is recession and deflation. They call this ‘internal devaluation’ – shifting relative prices by reducing domestic demand in the debtor countries, thereby shifting the terms of trade. Marshall Auerback calls it ‘infernal devaluation’. Marshall’s right. Today we got more […]