We are still emerging from the Global Crash of 2008 and the great leveraged real estate bubble that accelerated during the last decade in the United States and spread around the world. Unsustainable surges in public debt, deficits and borrowing costs accompany the recovery and threaten to undermine it for various reasons in many afflicted … Read more
I’m afraid that while considering the Greek public finance crisis “The Economist” (A question of maturity, April 20th) is right while suggesting that “the economics point to a harsher solution: a steep write-down as part of a broader package of reforms.” I’m afraid that such an obvious argument will hardly be understood nor supported for … Read more
With the arrival of the first real Japanese data since the Tsunami struck the immensity of the tragedy which Japan is passing through is only now gradually becoming apparent. Exports were down by a seasonally adjusted 7.7% in March over February, while imports were only fell by a much more modest 1.4%, with the inevitable … Read more
It has been twenty years now since first glasnost and then the collapse of the USSR lifted the curtain on the appalling environmental record of Soviet socialism. Over that same 20 years, the burgeoning economy of socialist China has overtaken the United States as the world’s largest emitter of greenhouse gasses. Still, it remains common … Read more
The source of the current global economic crisis lies deeply in U.S.-style neoliberal capitalism, or contemporary laissez faire. It could not have been triggered in countries with a social market economy, but only in the conditions of the neoliberal Anglo-American model. The intense shock the world experienced could take place only as a result of … Read more
Seven generations ago – in 1848 – Europe was swept up by the revolutionary wave of the Spring of Nations. One generation ago the year 1989 was written in bold letters into the book of History. And now, in 2011, we have again a Spring of Nations, this time first in North Africa and Mid-East, … Read more
There is no way back, the genie is out of the bottle. MENA’s shortcomings have been irrevocably exposed by the global crisis. Bold reforms are now impossible to postpone, if the region is to avoid years of stagnation and violence. Transitioning to democracy requires courage and concessions. The opportunity is unique, and must be seized: … Read more
The huge compression of the investment horizon towards an extreme short term bias continues to be a major barrier to real recovery. A methodology to develop a direct capital flow between investors and the real economy is now desperately needed. Reflexivity, or simply put, the fact that markets have de facto no self adjusting mechanisms, … Read more
As Japanese officials continue to toil away in what we all hope will be a successful bid to avert a worst case scenario nuclear meltdown even while thousands of Japanese still remain missing and unaccounted for, financial market participants across the globe have been struggling with themselves to answer one and the same question: just … Read more
Barry Eichengreen had a very interesting piece in last week’s Wall Street Journal. In it he argues that we are approaching the end of the period in which the US dollar is the world’s dominant reserve currency, and suggests what that might mean for the world. Here is what he says: The single most astonishing … Read more