Currency and Financial Markets Europe Macroeconomics

Delusional Gemany

This article was first published on Project Syndicate on 14 November 2013.

In recent days, Germany’s representative on the European Central Bank’s governing council has expressed strong disagreement with the ECB’s decision on November 7 to cut its benchmark interest rate. Now the European Commission has opened an investigation into whether or not Germany’s huge current-account surplus is causing economic damage in the European Union and beyond. This investigation and criticism of Germany’s export-based growth model has incited outrage in … [continue reading]

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Currency and Financial Markets Economic Policy Europe Macroeconomics

The Drawbacks of Forward Guidance

This article first appeared on Project Syndicate on 11th October 2013.

The nomination of Janet Yellen to succeed Ben Bernanke as Chair of the US Federal Reserve comes at one of the riskiest moments in the recent history of the Fed. The Fed’s announcement in May that it might start tapering its long-term asset purchases surprised many central bankers, and triggered a sell-off from markets worldwide. But some of the good news about America’s economy was bad news for financial … [continue reading]

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