The case for or against a British exit from the EU – #Brexit – is headline news. For the moment the earlier quarrel about a possible Greek exit from the Eurozone – #Grexit – seems to have taken the back seat – with one or two exceptions such as Christian Lindner, leader of Germany’s liberal […]
As The Euro Time Bomb Ticks Away The ECB Turns Desperate
These are not happy times for Europe. Ukraine, Russia, and rising anti-democratic influences in Hungary and Poland represent latent threats at the European Union’s eastern front. The prospect of Brexit is a more acute one at its western front. After letting loose manifold conflicting forces that continue shaping internal politics in many EU countries and […]
Euroland Has No Plan B: It Needs An Urgent Recovery Plan
At last, the eurozone economy appears to be experiencing some kind of recovery. GDP started growing again in the spring of 2013, following seven quarters of decline, with domestic demand shrinking for even nine consecutive quarters between 2011 and 2013. Today, it is conceivable that within a year or so the eurozone might recoup its […]
Euro Union – Quo Vadis?
This week a slow-motion train wreck hit the wall in Europe. Greece’s Syriza government came to power earlier this year on a mandate to keep Greece in the euro but end austerity. It was clear from the start that this project could only work out if Greece’s euro partners finally acknowledged that their austerity policies […]
Why The Eurozone Needs A Treasury
Slowly but surely a new consensus is emerging emphasizing the need for Europe’s currency union to organize public investment as a means to overcome its crisis, by now in its seventh year; the outlook being truly grim. Back in July President-elect of the European Commission Jean-Claude Juncker called for a €300bn public-private investment program. ECB […]
Is The Eurozone Turning Into Germany?
It has been pretty clear since at least the spring of this year that the ECB was keen to see the euro weakening. At the time the euro stood near to $1.40. Policymakers in a number of euro area member states issued calls for a more competitive exchange rate, directing barely hidden criticisms in this […]
On The Alleged Pains Of The Strong Euro
Since its most recent low of $1.20, reached in the heat of the summer of 2012, the euro has appreciated by 15 percent against the US dollar and by more than 10 percent in inflation-adjusted terms against a broad basket of currencies representative of the euro area’s main trading partners. Amounting to a significant loss […]
Inflation, Deflation And ECB Asymmetry
It is quite interesting to see how popular myths can live on in the public’s mind and continue to cause harm and irritation even when the facts speak to totally different language. How can education fail so badly? The particular example I have in mind here is Germans’ supposed exceptionalism in matters of inflation hyper-sensitivity. […]
On German Public Opinion And Illusional ECB Power
After taking a short breather in late January-early February, the markets now seem to be back in ‘happy mode’. Whether the news on the economic recovery is good or bad doesn’t really matter. The current convention is that growth acceleration is under way. That emerging markets had become key drivers of global growth was yesterday’s […]