Political Economy

The change of power on the regional level is important in Spain because of their relative fiscal autonomy. Regions control spending on health care and education and account for half of government employees. They have an outstanding debt of…

This is good satire from Stephen Colbert. It reminds me a little of Conan, William Shatner and Sarah Palin doing their poetry readings in 2010.

Not raising the debt ceiling will not mean default, instead it will mean other federal spending will get cut

Greece and Ireland appear to have lost an important political ally with the sidelining of Dominique Strauss-Kahn as both plead for more financial assistance from European partners to avoid an early restructuring of debt. The key word is…

With markets now contemplating some sort of debt “re-profiling” by Greece, we thought it would be helpful to summarize the two most recent major debt restructurings by an EM borrower for some guidance on what such a move could imply for…

The European finance ministers approved an aid package for Portugal. Ireland is still seeking better terms. Although France's effective corporate tax rate is lower than Ireland's, Sarkozy is reportedly refusing to sanction some easier terms…

The policy response to the European debt crisis is critical and that response is function of European politics. There have been a number of developments in European politics that investors should be aware of.

If the facts go against us, we just dismiss them by selective editing or simply making stuff up to support our original thinking. When it comes to politics, when it comes to economics, the facts don't really matter. Human reasoning is not…

Below is the text from the letter from US Treasury Secretary Timothy Geithner to Congress via Harry S. Reid, Majority Leader of the Senate, informing Reid that the debt ceiling has been breached.

If the strongest argument against going back to the Drachma always was that this would imply default, now that default is coming, why not allow Greece to devalue? As Krugman says, the issue isn’t whether Greece would openly decide to exit…