internal devaluation

Normally, we think of trade as a story of spendthrift nations 'living beyond their means' and saver nations being productive. In this view, savers are virtuous and spenders are sinful. And the easiest way to see who the saints and sinners…

Crisis has returned to the eurozone with talk about a Greek sovereign debt restructuring rife. There is even talk of Greece being forced out the eurozone. With Greek stocks plummeting and sovereign yields rising, we should take this talk…

The data flow out of Europe today is pretty bad. German factories orders missed and unemployment rose to record levels in France and Greece. Meanwhile the IMF admitted that Greece's delayed debt restructuring "provided a window for private…

Below is the leaked Greek bailout document that everyone has been talking about. Yesterday, the Financial Times first revealed this analysis' existence. Here is Rob Parenteau's understanding of what the Troika analysis demonstrates about…

10% ‘internal devaluation’ in Germany took eight years. We are talking now about 20-30% wage and price cuts in Greece and Ireland. How realistic is that?

In a post mirroring the policy prescription that German economist Hans-Werner Sinn recently gave, Nouriel Roubini advises Greece to default and exit the euro zone. Where Sinn is concerned about German taxpayers paying the bill left for…

What Sinn is making plain is that Greece’s balance of payments problems would not go away if Greece were to remain in the euro zone. And this would mean more indebtedness and further transfers to Greece down the line when they get into…

Guilio Tremonti, the Italian Finance Minister, last week compared Germany and its small-minded Chancellor Angela Merkel to a first-class passenger on the Titanic. To repeat: this is not a problem confined to the periphery. The sovereign…

Randall Wray takes a bearish view of the Greek situation, the capital position of European banks and the future of the Euro.

Greece and Ireland have become the litmus test for whether economies will be sacrificed in attempts to pay debts that cannot be paid. An interregnum is threatened during which the road to default and permanent austerity will carve out more…