austerity

I still find it hard to believe a Greek exit from the euro zone is imminent. So it's good to see someone push back on the concept that a Greek exit from the euro zone is imminent. John Dizard at the FT does just this in a piece out today…

In February I wrote about the political economy of a Greek default (and euro zone exit), predicting that a Grexit was all but inevitable. In the last few days, there has been an almost feverish debate about this issue, so I wanted to update…

The evidence is becoming increasingly clear that German policy makers are prepared for Greece to exit the euro zone. Knowing this changes how one should view the likely policy responses in Europe. In the short term, this means allowing more…

Later this week, I plan to write a more comprehensive post on the European sovereign debt crisis to incorporate what we have learned since the French and Greek elections. Here's a short preview of what I will have to say.

It encourages me to see Portugal fade from the headlines instead of becoming the next Greece. But it discourages me to see Spain take Portugal's place as the next Greece. All the while, the root problem has been the same: the common…

A slew of manufacturing data was released today in Asia and Europe to go along with the Manufacturing data we saw yesterday in the United States. The data show a divergence of economic fortunes that demonstrates the severity of Europe's…

Spain has become the new Greece. Actually, in many respects Spain is now worse than Greece. The Spanish unemployment rate is already so high and unlike Athens, Madrid has made no headway in reducing its public debt levels (whereas the…

The mood has turned against austerity in the euro zone because it is now rightly seen as anti-growth. The question is what next. Here I will hazard a few predictions of where euro zone policy is headed including a EuroTARP.

The agenda in the euro zone is changing. The likely outcome of the weekend elections in Greece and France are just as much an effect as a cause of the shift in the agenda. For the first time since the crisis began, the German insistence on…

The news from Spain's statistical agency INE is that the Spanish economy shrank 0.3% in the first quarter of 2011. Spain thus joins ten other Western European economies in recession. None of this should come as a surprise. Given the policy…