eurozone periphery

Just to follow up on the last post, which was relatively optimistic about the eurozone, I want to show you this chart of non-performing loans in the periphery. I believe it tells a story of debt deflation and explain why the contraction in…

Michael Pettis had a very good post out yesterday that focused on the sectoral balances within and across eurozone countries which I recommend. His point is that excess German savings driven by wage suppression was behind macro imbalances…

Last year, we saw a sea change in official German policy regarding the euro crisis and inflation. The German government came out in favour of accepting higher inflation domestically in Germany as a sacrifice for eurozone wage and price…

When I see the chart for Euro zone NPLs and look at the numbers, I think debt deflation. And this is exactly the problem with the euro zone's policy mix.

In all of the bailed out nations of the euro zone, sovereign default is the worry as this can create a cascading knock-on effect like the failure of Creditanstalt in 1931 that ushered in the banking crisis of the Great Depression. We see…

The European Union is an existential crisis because its crowning achievement, the single currency, has come under assault from all sides. The continued existence of the Euro has even been called into question as country after country within…

French President Francois Hollande delivered an impassioned speech before the European Parliament in Strasbourg today decrying the strength and volatility of the euro exchange rate. This was the best indication that Hollande is feeling…

I had intended to write this post yesterday morning. However, after the bank scandal in Italy and the surprise drop in US GDP, I waited a day. The gist of what I intend to say here is that Italy is in the process of decoupling from Spain.…

All G7 economies are struggling in the post-crisis climate, but US GDP has recovered to pre-crisis levels, while the Eurozone simply hasn’t. This column portrays the global crisis as a transitory shock for the US, but as a quasi-permanent…

This weekly is a follow-up post to the daily I wrote on Greece earlier in the week. As I indicated then, my position on Greece has always been that eurozone leaders would be loathe to 'kicking Greece out of the euro zone". The talk of a…