In The News

False European Hopes of a Chinese Savior

Jonathan Holslag June 28, 2011
Europe courts China with hope of financial rescue. “Europe’s economy is now sufficiently damaged that China alone can never do enough to help it recover,” writes researcher Jonathan Holslag for the Financial Times. “To put it bluntly, why should we expect Chinese companies to create jobs in Europe when our own ones stumble under the weight of high wages and taxes? And why should we expect our...

How the Euro Became Europe's Greatest Threat

June 22, 2011
Ordinary Europeans are losing patience, wondering if more bailouts can possibly stem the crisis once and for all. A handful of finance ministers scramble to contain the damage, preventing the Greek crisis from spreading and forcing cuts in valued social programs in nations where citizens did not overspend. The euro’s founders did not envision such a crisis or the political fury over a huge...

The Eurozone Heads for Breakup

Nouriel Roubini June 16, 2011
Greece, a nation of 11.2 million, owes more than €300 billion. Restructuring the debt is inevitable, notes Nouriel Roubini in a blog posting for the Financial Times. The only unknowns are how and when. Europe united behind the euro as a single currency before enacting structural reforms and streamlining monetary, fiscal and exchange-rate policies, Roubini explains, adding that “early interest...

Financial Regulation: Facing a Global Challenge

André Lévy-Lang May 13, 2011
Without global interventions, the outcome of the recent global crisis could have been far worse. Finance is an essential tool for unlocking capital, economic development and innovation, and writing for ParisTech Review, André Lévy-Lang outlines features and weaknesses of modern finance and its assessment of risk. Capital requirements since the late 1980s led to incentives for banks to engage in...

Greece Considers Exit From Euro Zone

Christian Reiermann May 10, 2011
Countries immersed in debt squirm under the scrutiny of creditors and angry taxpayers. Spiegel Online reports that Greece, seeking relief, is considering abandoning the euro. The Greek government has denied the report. The story by Christian Reiermann reports that any such relief would be short-lived: Capital markets would sever ties. Banks would go insolvent. EU aid to Greece would stop....

Advanced Economies: Minutes to Midnight? Part II

Bruce Stokes May 2, 2011
To encourage growth, governments borrowed to finance infrastructure and current expenditures, and anticipated revenues to eventually cover the costs. Low interest rates led to surging debt, investment bubbles and unrealistic growth projections rather than a sustainable economy with jobs and tax revenues. This two-part series analyzes the impending crisis for advanced economies. Europe had hoped...

Advanced Economies: Minutes to Midnight? Part I

David Dapice April 28, 2011
Advanced economies face momentous decisions to sustain their prosperity and lifestyles. In a two-part series, YaleGlobal reviews the challenges faced by the US and the Eurozone. In 1917 the US Congress passed statutory limits, unusual by world standards, for issuing bonds, to avoid separate approval on every issue. The ceiling has been raised many times since to the current limit, $14.294...