In The News

The Popular Mandate

Nayan Chanda November 8, 2011
A suggestion by the Greek prime minister for a referendum on a proposed European bailout – negotiated by European leaders to continue lending to Greece while erasing half the nation’s debt –was bashed by financial markets and Western leaders. Analysts anticipated an angry Greek electorate to reject the deal, and the prime minister backed down. "Athens offers a valuable lesson in...

Denying Imbalances, G20 Risks Chaos – Part II

David Dapice November 7, 2011
Once again, the leaders of the world’s most powerful economies have procrastinated in coming together on a viable global strategy to end unsustainable imbalances. Overshadowing the G20 summit was the threat of a disorderly Greek default; the Greek government’s scrambled response; and rising bond prices and trouble for Italy’s debt. Eurozone leaders agreed to set up a rescue fund of at least $1...

Denying Imbalances, G20 Risks Chaos – Part I

Shen Dingli November 4, 2011
After the Asian financial crisis in 1997-98, a group of developed and emerging economies came together as the G20 to stabilize global financial markets. With widening imbalances caused by huge trade surpluses on the part of some nations while others drown in debt, the global economy is perilously close to chaos. Now the eurozone – specifically and immediately, Greece and Italy – is in danger of...

US Banks Sell More Insurance on Europe Debt

Yalman Onaran November 3, 2011
Sales of insurance that guarantee against European debt losses are booming. A Bloomberg article questions the protection of an endless chain of hedging: “The banks say their net positions are smaller because they purchase swaps to offset ones they’re selling to other companies,” the article quotes Frederick Cannon, director of research at New York-based investment bank Keefe, Bruyette & Woods...

Greeks Seek to Escape Debt Crisis Abroad

Ingrid Melander November 3, 2011
Governments that dawdle in resolving economic crisis – or impose unfair taxes or cuts – could lose their smartest, most skilled citizens. As Greece’s debt crisis rocks the European Union, thousands of young and skilled workers are emigrating, reports Ingrid Melander for Reuters. Nonprofit aid organizations for the Greek diaspora are swamped with aid requests, she adds. Greeks are furious about...

Europe Sneezes, India Catches a Cold

Nayan Chanda November 2, 2011
Cooperation could prevent contagion stemming from the Greek debt crisis, explains Nayan Chanda, YaleGlobal’s editor, in a column for the Times of India. The 17 members of the eurozone shared a monetary policy without common fiscal regulation. Reckless borrowing ensued. A negotiated bailout requires setting up a $1.4 trillion rescue fund along with reforms. So far, Greece and Italy resist...

London Is Under Constant Attack From Europe

James Kirkup October 28, 2011
Nations will watch closely to see if Britain can distance itself from the pain of the Greek debt crisis. Great Britain is one of 27 members of the European Union, but not part of the 17-member eurozone. The British capital of London is also a global center of financial firms, which greased the way for massive debts in Greece, Italy, Spain and elsewhere. David Cameron, the British prime minister...