debating progressive politics in Europe and beyond
Since December 2011 the European Central Bank (ECB) has pumped two waves of extra liquidity into the European banking system, in an effort to keep it afloat – and persuade backs to invest in sovereign debt. Yet Paul De Grauwe argues that these banks are still wracked with uncertainty, which may lead to further sell-offs of this [...]
In the aftermath of the most recent European Council, there was an avalanche of public statements which, in effect, put the Council’s policy package into serious doubt. One statement in particular deserves further analysis. In an interview with Frankfurter Allgemeine Sonntagszeitung on the 11th of December, Bundesbank president Jens Weidmann expressed the view that the [...]
Is the eurozone stepping back from the brink? This might just be possible, because the emerging outlines of a new framework to resolve the ongoing sovereign-debt crisis contain a key component that was missing so far. Indeed, that component’s absence was behind this summer’s spreading financial crisis, which moved beyond small, peripheral countries like Greece, [...]
With the Eurozone crisis casting doubt over the solvency of Spain and Italy, the ECB has once again intervened to provide liquidity in the government bond markets. This column asks the question: Is there such a role for the ECB as a lender of last resort? In October 2008 the ECB discovered that there is [...]
You can always trust the Americans, Winston Churchill said, because in the end they will do the right thing, after they have exhausted all other possibilities. For the last 18 months, this has been Europe’s method for confronting its sovereign debt crisis as well: it has taken the necessary decisions, but always as a last [...]
High volumes of currency reserves, which are currently invested in debt obligations denominated in Dollars, are looking for more secure investment opportunities. China and Russia, e.g., are requesting the IMF to emit such alternative “global currency bonds”, denominated in the IMF´s accounting unit SDR-“Special Drawing Right”. Dominique Strauss-Kahn currently supports this idea, suggesting that the [...]
The start of 2011- let’s call it Year Two A.G. (“After Greece” debt crisis) – has brought both good and bad news on the economic front. The bad news is that 2 A.G. is beginning much like 1 A.G. ended, with headlines about government debt and default, this time focused on Portugal and Spain. The [...]
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