Berlusconi's 'burlesque games' apparently included dressing up as Barack Obama http://t.co/WS1QwkyJ
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Why President Obama Can Stop Worrying About Europe
Can President Obama’s increasingly confident reelection drive come undone because of the economic turmoil in Europe? That is a question that many in the White House are said to be worrying about. The fears have some foundation based on recent experience. The relatively strong US economic recovery in early 2010—3.9 percent growth in the first [...]
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Chinese Household Wealth and the Housing Market
The Chinese housing market is clearly undergoing a correction that may eventually bring housing prices back to a more reasonable level. As the past several years have made all too apparent, housing downturns are economically painful and can lead to larger economic crises. The network of financial leverage that fueled the US housing bubble turned [...]
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Why Greece Must Not Leave the Euro Area
The two most crucial questions about the Greek public debt crisis have been whether the country would be forced to default on its public debt and whether it would have to leave the euro area. At present Greece has pursued an orderly default on its privately held debt, but it remains in the euro area. [...]
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Reauthorize the Export-Import Bank: Part II
Reauthorization of the Export-Import Bank is stalled in Congress because of opposition from odd bedfellows. The issue has been addressed previously in this forum, but in this posting a solution to the impasse is offered that could clear the way for funding a vital federal program. Before we get to that drama, it’s worth considering [...]
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North Korea’s Surprising Steps: ‘Modest’ Progress
In the wake of the death of Kim Jong-il, there were questions as to whether anyone was in charge in Pyongyang. Now we know that someone is capable of making decisions and their first one constitutes a conciliatory (indeed, concessionary), not belligerent, gesture. The agreement does not completely freeze the North Korean nuclear program but [...]
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An Alternative for Greece: An Incomes Policy to Achieve Internal Devaluation
The sad fact is that no one outside officialdom (who are duty-bound to talk nonsense when sense is too embarrassing) seems to regard the recent privately held debt write-down and second Greek bailout as likely to offer an exit to Greece from its nightmare, even in the long run. The reason is simple: Greek competitiveness [...]
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Oops, I Underestimated China’s GDP
More than a year ago, I argued that China’s GDP in purchasing power parity (PPP) dollars had overtaken that of the United States in 2010. This calculation is used in my book, Eclipse: Living in the Shadow of China’s Economic Dominance and plays a role in my conclusion that China has overtaken or is close [...]
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China: Capital Account Liberalization and the Corporate Bond Market
The People’s Bank of China (PBoC) released a report (Chinese language) this week that focused on prospects for capital account liberalization. Opening up the capital account would be a major reform, perhaps the most significant in a more than a decade. It would give Chinese savers an escape hatch from financial repression and force the [...]
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Brinkmanship in Brussels, Sturm and Drachma for Greece and Europe
Just as it did when Congress recently extended the payroll tax cut, brinkmanship has produced a deal in Europe to extend a new lifeline to Greece and clear the way for the biggest sovereign bond restructuring in history. Both pieces of the agreement—the privately held Greek debt write-down of more than €100 billion and the [...]
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China’s Rebalancing Will Not Be Automatic
The imminent rebalancing of China’s economy has been forecast repeatedly over the past several years. With the shrinking of China’s external surplus during 2011, proponents of this argument have all but declared victory. The decrease of the current account surplus, from 10.1 per cent in 2007 to less than 3 per cent in 2011, is a [...]
