austerity

It is not at all clear where things in Portugal are headed. The economy is in a deep depression. Yet, sovereign bond yields have come down. The Troika is even relaxing Portugal's austerity target, hoping this will drive yields down further.…

More and more the economic data coming out of the US seems to support continued recovery. The housing data certainly does. Consumer credit is increasing. And the Fed Flow of Funds data shows household balance sheets significantly repaired.…

In mid-January I had said I expected a recession in Q2 as a result of austerity and a government shutdown in the US. Recently, however, I have moved away from that position as a baseline, largely because of the rebound in housing and the…

Well, well, well, it seems we have a problem in Euroland. The Dutch have now confirmed what I have been saying all along: they have run into so many fiscal problems that they will need to relax their targets instead of doubling down on…

Europe is in recession right now, but the US is in a weak but fairly long-lived economic recovery. The difference in economic fortunes owes entirely to differing policy responses in both regions. In Europe, the economic paradigm has…

A reader of our blog here at Credit Writedowns recently wrote to me, detailing why Italians voted as they did in the recent general election. Her view speaks more to a rejection of corporatism and corruption than austerity.

France had pinned its hope that threat to EMU would be turned back before the wolf came it its door. The Italian political tensions come at the poor time for France. Its ability to absorb shocks is terribly constrained. Recall what has…

News links for 26 February 2013

The situation needless to say is very fluid and although the euro has stabilized, the threat to euro area stability is clearly evident in the debt markets where Italy's 10-year yields has soared 32 bp and the spread over Germany has widened…

According to Angela Merkel, speaking in the German city of Mainz in mid February, European countries struggling with the fallout of the euro-area debt crisis have much to learn from East Germany’s experience with economic overhaul…