Break up the big banks
Rohde, David. The numbers are startling. HSBC, the world’s fifth-largest bank, failed to review thousands of internal anti-money-laundering alerts, according to a Reuters investigation published last week. The bank did not file legally required “suspicious activity reports” to U.S. law enforcement officials. It hired “gullible, poorly trained, and otherwise incompetent personnel” to run its anti-money-laundering […]
German Adjustment
Krugman, Paul. It has become clear that one of the main forces behind the insistence on austerity as the answer to Europe’s problems is the belief among many German opinion leaders that their own experience in the last decade shows the way. Here’s Josef Joffe: Why [should France emulate] the former German chancellor? Because he […]
Germany’s Neighborhood Watch
El-Erian, Mohamed. On a recent trip to Germany, I was struck by two distinct narratives. One narrative features a robust German economy with low unemployment, strong finances, and the right competitive position to exploit the most dynamic segments of global demand. The other narrative describes an economy that is encumbered by never-ending European debt crises […]
The coming revolt against austerity
Wyplosz, Charles. Mindless austerity is losing policy credibility in some Eurozone nations. This column suggests governments shouldn’t mix long-term growth and fiscal discipline nor produce another Lisbon strategy. Instead, they should adopt a framework for fiscal policy cooperation, restructure debts, and remember that fiscal discipline is for the long run. Πηγή: Voxeu πλήρες κείμενο
The Euro-Exit Taboo
Dadush, Uri. Stay or leave? Should Greece persist with its extreme austerity plan, or should it abandon the euro? What about Portugal? Spain? In mainstream political discourse, posing the question of euro exit is taboo. When Prime Minister Papandreou of Greece, an ardent European, unexpectedly proposed a national referendum on the matter (one he […]
Europe’s Zero-Sum Dilemma
Rachman, Gideon. Europe’s debt crisis is threatening a political order that has been built up over the course of more than a half century. It is still entirely possible—indeed likely—that the European single currency will not survive the crisis. Angela Merkel, the German chancellor, has predicted that if the euro collapses, the European Union will […]
A Crisis in Full Flight
Sinn, Hans-Werner. For a while, it looked as if the European Central Bank’s €1 trillion credit program to pump liquidity into Europe’s banking system had calmed global financial markets. But now interest rates for Italian and Spanish government bonds are on the rise again, closing in on about 6%. Πηγή: Project Syndicate πλήρες κείμενο
Austerity Has Only Just Begun
Johnson, Simon. In the early 1930s, much of Western Europe faced a situation very much like today — if countries wanted to keep their existing fixed exchange rates (a constant value for their currency), they needed to engage in considerable austerity. Governments held long and hard to the notion that to change the exchange rate […]
The euro’s salvation lies in a little less Europe; not more Europe
Persaud, Avinash. Does Europe need a fiscal union to support its monetary union? This column argues that the cause of Europe’s problems is not public sector ill discipline but rather private sector ill discipline. In such a situation, it asks whether we should be trying to save a drowning man by putting him in a […]
A World Adrift
Sachs, Jeffrey. The annual spring meetings of the International Monetary Fund and the World Bank have provided a window onto two fundamental trends driving global politics and the world economy. Geopolitics is moving decisively away from a world dominated by Europe and the United States to one with many regional powers but no global leader. […]