In The News

Government Had No Reason to Intervene in Stock Market Turbulence

Ling Huawei July 7, 2015
Interventions tried by the Chinese government to curb sharp declines in the country's stock markets are drawing unusually pointed criticism from analysts. “The bottom line is this: Only a systemic risk that threatens financial stability justifies a government bailout,” notes Ling Huawei for Caixin Online. “And the intervention raises a thorny question: Who takes the blame if the securities...

Greece – A Mess With Consequences

David Dapice July 7, 2015
Greek voters have soundly rejected a set of reforms from the European Central Bank, the European Commission and the International Monetary Fund. The “no” vote may mark the beginning of Greece’s exit from the eurozone, and the uncertainty of what happens next comes at a bad time for the global economy, warns economist David Dapice. Economists can only speculate about the possible political and...

Angela's Ashes: How Merkel Failed Greece and Europe

Peter Müller and René Pfister July 6, 2015
The Greek debt crisis, has put Europe into turmoil, and leaders could have set limits on Greece long ago. Greek Prime Minister Alexis Tsipras heightened uncertainty by scheduling a referendum on whether Greece should accept conditions for a bailout. “Tsipras' radicalism lies in his faith in the power of the decision,” write Peter Müller and René Pfister for Spiegel Online. If he doesn't...

Greece's Referendum: The Price of Five Years of Cowardice

Christian Rickens July 1, 2015
Europe’s rescue measures for Greece have failed. The nation is on the brink of bankruptcy, threatening default on International Monetary Fund loans that would trigger an end to additional bailout funds. Greek leaders stunned the rest of Europe by refusing to decide on a proposed deal and instead putting the matter before voters. Europe missed three windows of opportunity to curtail the ongoing...

Central Banks: Printing Money Delays Domestic Structural Reforms

Will Hickey June 30, 2015
Countries are waging currency wars in competition over export markets, jobs and foreign investment – printing money, taking on more debt, rather than pursuing serious and needed domestic structural reforms. “Without deeper structural reforms that encourage consumption, innovation and a secure safety net ensuring certainty, the democratic governments will eventually flounder and citizens will vote...

Greece’s Banks Give Eurozone Peers Glimpse Into Abyss

Paul J. Davies June 29, 2015
Greek banks do not have enough money to provide depositors with limited amounts, restricted at $67 per day, which may be needed for daily expenses. Greece is not alone. “Beyond Greece, the rest of the eurozone must look to an acceleration of full banking union to protect weaker banks in Portugal, Austria and other countries,” writes Paul Davies for the Wall Street Journal. The bailout program for...

If Greece Defaults, Imagine Argentina, But Much Worse

James B. Stewart June 26, 2015
The best option for Greece is conceding on Europe’s demands for austerity, argues James B. Stewart for the New York Times, to avoid the economic havoc of Argentina, which has defaulted on debt multiple times. A Greek default would be worse than Argentina’s. Greece could expect a run on banks of a much higher magnitude and confusion over currency with a steep drop in purchasing power. Argentina’s...