We hear a lot about the future of Afghanistan after NATO withdrawal in 2014. Most of the speculation focuses on security and politics. Too little of it concerns economics. A pair of new reports, one from the World Bank and the other from the IMF, help fill the gap. If you thought the security and … Read more
Here is my latest article from the Financial Times: It is increasingly clear that Italy’s public debt is unsustainable and needs an orderly restructuring to avert a disorderly default. The eurozone’s wish to exclude private sector involvement from the design of the new European Stability Mechanism is pig-headed – and lacks all credibility. With public … Read more
I agree with the disappointed reader who noted politely that my last post, my official answer to Sabah’s attacks to my newspaper, Bloomberg and myself, was not my best- she actually said it was “very bad”. I did lose my cool after Sabah’s baseless accusations, and always responsive to reader feedback, I took out the … Read more
Defining a war, in a traditional sense – uniformed soldiers, helicopters, artillery, tanks – means that the U.S. is still very much at war in Iraq and Afghanistan. But defining wars in a different sense – Clausewitz’s, “the continuation of politics by other means” – increases the number of U.S. wars. The U.S. continues to … Read more
In order to minimize the effects of the long international crisis, it is necessary to avoid the temptation of increasing fiscal and parafiscal expenditures. I open the internet edition of an influential foreign newspaper and the main headline begins like this: “Imminent collapse of …”. In normal times it would be easy to guess what … Read more
The new Italian government of Prof. Mario Monti faces a deadly challenge with three formidable hurdles: the choice of the best economic policy strategy, the rapidly deteriorating context of the economic and institutional Europe, the trembling loyalty of his unprecedented majority of “the unwilling”. Prior to addressing detailed measures, the government should choose a clear … Read more
There is a growing movement to reform, reign-in, or simply shut down the Fed. And this is no longer limited to the crazy right conspiracy theorists. Along with Presidential candidate Ron Paul, Denis Kucinich and Bernie Sanders are harshly criticizing the Fed and demanding Congressional action. Very reasonable analysts including Chris Whalen at The Institutional … Read more
Billionaire short seller Jim Chanos, founder of hedge fund Kynikos Associates Ltd., spoke to Bloomberg TV’s Betty Liu this morning about China’s banking system and outlook for the Chinese economy and real estate market.Chanos on his recent trip to Hong Kong and Australia: “I think we probably came back a little bit more bearish….Our concerns … Read more
This is part two of my multi-post commentary on the Euro area Balance of Payments (BoP). Yesterday, in part one, I compared the EA current account balance to its country-level cross section. Today’s post will be more instructive in nature, as I dig into the components of the EA current account (CA) and capital account (KA) balances. My general conclusion … Read more
[edited the end based on reader feedback; apologies to readers who thought it was not my style; my anger at insults and false accusations had got the better of me] Just as I was getting geared up to write an addendum to Monday’s Hurriyet Daily News column, which also appeared here, I got notified that … Read more