"With 3% of the world’s population, the US can no longer dominate the rest of the world." http://t.co/tfC2YRs3fO
13 minutes ago
Archive for March, 2006
-
Today Iceland: Tomorrow Turkey, Hungary, Australia, New Zealand, Spain, U.S.?
The recent speculative attack against the Icelandic currency and the incipient run on its banks is no news (actually a deja-vu as my co-author Brad Setser says) to students of financial crises in emerging market economies; Brad and I wrote an entire book about it. A combination of a large and growing current account deficit, driven in part [...]
-
U.S. and China: On a Collision Course on the RMB this year? The Systemic Financial Risks of a U.S.-China Trade War
It looks like the U.S. and China are on a serious collision course on the issue of the exchange rate policy of China. Ther risks of a trade war triggered by the U.S. branding China as a currency manipulator – and the severe financial market repercussions of such developments – are serious and not clearly appreciated [...]
-
Roubini, not the IMF, is concerned about Italy and EMU
In an interview this week for the German magazine Wirtschaftswoche I have reiterated my concerns about Italy’s economic conditions and the risks that, unless Italy implements serious economic reforms that increase productivity, Italy will eventually be forced to exit EMU in the next five years. Unfortunately, the Italian press (see here) is reporting today these views and the [...]
-
China’s Next Houdini’s Trick: How to Stop Intervening in the Forex Market and Still Maintain the RMB Peg
As the political heat of the U.S. pushing China to slow down forex intervention and allowing the RMB appreciate is building up, the Chinese authorities may be starting to think about how to significantly reduce their rate of forex intervention while still maintaining the value of the RMB very stable: if that trick were possible China could legitimately argue [...]
-
Is the ECB tightening too much too fast risking to clip the wings of a fragile Eurozone recovery?
As expected, today the ECB decided to increase its policy rate to 2.5%; less expectedly, Trichet’s tone was hawkish signaling further interest rate increases at future meetings of the ECB board; thus, the bond market fallout today from his statements. But a serious question remains open: is the ECB rising rates too fast? Will it tighten too much [...]
