The news these past couple of days has been dominated, of course, by the efforts of European Union leaders to reach a bailout agreement — and the fact that, immediately after the outlines of such an agreement were reached, the first thing the EU did was dispatch an envoy to Beijing, to persuade China to help fund … Read more
Economists make it their business to know about incentives. Indeed they devote entire blogs to the subject. But what are the incentives for top economists to ‘waste’ time on these blogs in the first place? This column calls on researchers out there to find out. Why do many economists, especially in the US, devote … Read more
I spent most of yesterday, like many of you, enjoying the “Beautiful Day” response of the markets to the Merkozy Miracle (yes, Angela did a good job, of course it’s a default, the creditors got away with a bit more than they expected, the EFSF structure is not [yet?] viable, CDS may still trigger but … Read more
Is the worst of the market sell off over? If we look at long term charts of prior collapses, it appears there is lots of upside to go. I am less convinced that there is nothing but smooth sailing ahead. For markets to continue to rally, we likely need to avoid a major collapse in … Read more
When I traveled to Reykjavik in October 2008 to offer the IMF’s assistance, the situation there was critical. The country’s three main banks—which made up almost the entire financial system—had just collapsed within a week of each other. The sense of fear and shock were palpable—few, if any, countries had ever experienced such a catastrophic … Read more
Last weekend, a leaked Troika report (Troika = ECB + EC + IMF) revealed that European policy makers now comprehend that the Greek policy prescription is not working (bold by yours truly): The growth and fiscal policy adjustments assumed under the program individually have precedent in other countries’ experience, but experience to date under the program suggests that … Read more
References to GWOT – as the Rumsfeld-era Pentagon liked to refer to its Global War on Terror – today carry certain freight. Firstly, the misapplication of military force and grand strategy that is the primary foreign policy legacy of the Bush administration has discredited the phrase. With the exception of military and intelligence officials who … Read more
Not that it was dull for the past year or so, especially since the Central Bank initiated its unconventional monetary policy last December. But things got really interesting yesterday with the usual announcement for the Inflation Report: PRESS RELEASE ON PRESS CONFERENCE The “Inflation Report” will be published on 26th of October 2011, Wednesday and … Read more
On October 4, Russia’s Prime Minister Vladimir Putin published an article in Izvestiia, “A New Integration Project for Eurasia – The Future Is Being Born Today,” that announces the initiative to create a supranational political structure on top of the CIS Customs Union in which Belarus and Kazakhstan participate along with Russia. While the prospects … Read more
Rob Parenteau and I have an op-ed at the New York Times today. Rob’s last post here argued energetically that the now-established trend of the corporate sector to save, as opposed to invest in growth, in advanced economies, and even most emerging economies, was tantamount to capitalists abandoning their traditional role. It reminded me of … Read more