International news pertinent to international economics is added here, together with several major newspapers and news magazines. The articles, in general, are held for a month on this main page. You can also access the older archived news articles, with the caveat that there is no guarantee that the links remain live. Current news on international financial markets can be found here. Note: Links to the New York Times require a free registration.
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Harvard's Rogoff Gives Legs to China Crash Talk
William Pesek (Bloomberg) Mar 1, 2010
The tale had Tom Clancy written all over it, with the CIA investigating a far-off economy out of concern that its collapse might pose problems for America.
Britain’s lack of credibility hurts sterling
Willem Buiter (FT) Mar 1, 2010
The currency is weakening and if the election does not deliver a strong government, markets will be panicked. Political parties should work together to reduce that risk.
Swapping Blame Over Athens
WSJ Mar 2, 2010
Europe finds scapegoats in derivatives and Goldman Sachs.
Greece, Act II—More Kabuki than Tragedy
Jacob Funk Kirkegaard (PIIE) Mar 2, 2010
In the nearly three weeks since European Union leaders called on the Greek government to produce a credible fiscal austerity plan and broader economic reform package, an increasingly strange, but predictable and scripted political theater has unfolded among the key actors. All are trying to pass the cost of restoring Greece to a long-term sustainable path on to someone else.
India's elephant charges on through the crisis
Martin Wolf (FT) Mar 2, 2010
The world's biggest democracy has changed. But economic pragmatism alone will not be enough: reforms are still needed
We need a Plan B to curb the debt headwinds
William White (FT) Mar 2, 2010
If the repeated asymmetric use of macro policies has rendered them ineffective, what other policies might help deal with the debt problem?
Greece calls in war debts
Julian Delasantellis (AT) Mar 3, 2010
Germany appears to be moving reluctantly, and with some fancy financial legerdemain, to bail out Greece from its debt crisis. The fix might work in the short term, and defuse increasingly vitriolic exchanges over the two countries' war history. Further ahead, the European Union must sort out how to handle its fiscal imbalances, or it must necessarily break apart under their weight.
'Multilatinas' Gain Prominence
Oxford Analytica (Forbes) Mar 3, 2010
More Latin American companies are turning into multinational corporations through global expansion.
EU Concludes FTA Talks with Colombia, Peru
Bridges Weekly Trade News Digest, Volume 14, Number 8 Mar 3, 2010
Trade negotiations between the European Union and Colombia and Peru ended on Monday with the resolution of a handful of outstanding issues in the nearly three-year-old talks. Spain's wish for the EU to finalise its trade agreements with Latin America during its six-month presidency of the bloc may well be coming true.
France looks on brighter side of Greek crisis
Paul Betts (FT) Mar 3, 2010
Christine Lagarde, the French economy minister, has conceded that the Greek crisis has at least had some collateral benefits.
Do not rush to switch off the life support
Robert Skidelsky (FT) Mar 3, 2010
Now is not the time to be scoring party-political points on the conduct of economic policy. It is a time for a radical reappraisal of the regulation of finance.
Lessons for Greece from an outpost of empire
David Hale (FT) Mar 3, 2010
Facing the humiliating prospect of default, Newfoundland’s parliament dissolved its country’s democratic government.
Markets look for political leadership
George Magnus (FT) Mar 3, 2010
The fundamental, and at times, passionate debate about sovereign debt is a predictable part of the sequencing of the financial crisis rumbling through the West.
Divorced Before Puberty
Nicholas D. Kristof (NYT) Mar 3, 2010
It's no coincidence that Yemen is home to child brides - including Nujood Ali, who fought for and won a divorce at 10 - and terrorists.
Why Europe should reject a new Glass-Steagall Act
Hans-Werner Sinn (VoxEU) Mar 4, 2010
A return of the Glass-Steagall Act has been suggested by US policymakers and commentators as a way to reduce risk in financial markets. This column argues that the legacy of separate commercial and investment banks actually made the crisis worse. Europe should not follow these proposals but should instead concentrate on strengthening the capital reserves of its banks.
Employment protection legislation and the financial crisis
Marco Leonardi, Julián Messina & Giovanni Pica (VoxEU) Mar 4, 2010
How do financial crises alter the effects of employment protection legislation? This column argues that firms with insufficient access to credit are even less able to rationalise their costs by switching from labour to capital – reinforcing the negative effects on productivity. But policymakers should also consider that, in countries with less-developed financial markets, employment protection provides insurance against labour-market risk.
The IMF's Inflation Illusion
Axel A. Weber and Philipp Hildebrand (WSJ) Mar 4, 2010
Central banks would sacrifice hard-won credibility by aiming at a 4% annual cost-of-living target.
Greece's Exit Remains Unlikely
Oxford Analytica (Forbes) Mar 4, 2010
Voluntary withdrawal from the euro-area is unlikely because the repercussions are too great.
Sterling throws a wobbly
Economist Mar 4, 2010
Why Britain's currency remains vulnerable to worries about a hung parliament.
Gendercide
Economist Mar 4, 2010
Killed, aborted or neglected, at least 100m girls have disappeared—and the number is rising.
Multilateral development banks: Cap in hand
Economist Mar 4, 2010
A difficult time for a fund-raising spree.
Currencies under pressure: Race to the bottom
Economist Mar 4, 2010
Countries compete to weaken their currencies.
Sovereign-debt ratings: The grim rater
Economist Mar 4, 2010
Countries don't like bad news about their creditworthiness.
Who pays for the budget deficits?
Economist Mar 4, 2010
Throughout the rich world battle lines are being drawn in the coming fight over deficit reduction.
Fiscal deficits: Sharing the pain
Economist Mar 4, 2010
Increasing budget deficits and rising government debts will entail fierce political battles.
What Really Ails Europe (and America): The Doubling of the Global Workforce
Richard Freeman (Globalist) Mar 4, 2010
How are workers from emerging markets changing the global economy? A Globalist Retrospective.
Is Population Growth a Ponzi Scheme?
Joseph Chamie (Globalist) Mar 4, 2010
When it comes to population growth, why is more not always better?
I.M.F. Help for Greece Is a Risky Prospect
Sewell Chan & Liz Alderman (NYT) Mar 4, 2010
If Greece asks the International Monetary Fund for help, it could touch off political and financial tension in other European countries.
A.I.G., Greece, and Who's Next?
NYT Mar 4, 2010
Washington must stop stalling and fix the derivatives market, which kneecapped American firms and contributed to the debt crisis in Greece.
Africa Faces Twin Challenges After Global Crisis
IMF Survey Mar 4, 2010
With world recovery under way, Africa faces the twin challenges of reviving strong growth and reinforcing resilience to the economic shocks that regularly batter the continent, IMF officials say, as the IMF's head embarks on a three-country visit to the region.
Whither securitization?
Vipal Monga (The Deal) Mar 5, 2010
The innovative financial technology has grown into the very engine of financing markets. Now policymakers are trying to revive it without blowing everyone up.
Six Steps Toward Financial Reform
Maurice R. Greenberg (WSJ) Mar 5, 2010
Our position as a global leader is at stake. Let's take time to get it right.
Greece, Act III--Athens's Leverage versus Eurozone Solidarity?
Jacob Funk Kirkegaard (PIIE) Mar 5, 2010
In the latest phase of its financial melodrama, Greece successfully placed a €5 billion 10-year government bond in the financial markets on Thursday (March 4). The bond issue was heavily oversubscribed, but it still produced a high yield of approximately 6.3 percent (or approximately 300 basis points above the benchmark risk-free mid-swaps rate, reflecting the market's demand for a risk premium). In many ways, this Greek return to the financial markets represents a huge success for the government and at least a temporary sign of approval from bond market vigilantes for its recently announced additional austerity measures. Ironically, however, this very success means that the leverage of the Greek government over its eurozone partners in the game of chicken related to possible financial assistance to Athens has been greatly reduced.
Global: Debating Debtflation
Spyros Andreopoulos, Joachim Fels & Manoj Pradhan (MS GEF) Mar 5, 2010
Colleagues and clients disagree that inflating away debt – debtflation – would work. In our view, inflation can result in substantial debt erosion: debt rolls slowly, implying that government interest costs respond sluggishly to increases in market yields; and bond markets are late in realising shifts to a new inflation regime.
Consumer reactions to exchange rate and trade price shifts: New evidence from online book retailing
Jean Boivin, Robert Clark & Nicolas Vincent (VoxEU) Mar 6, 2010
How much of a change in exchange rates is required to redress global imbalances? This column presents new evidence from online bookstores suggesting that neither shoppers nor retailers react to price differences across borders. This implies that realignment of cross-country consumption levels may require large and persistent exchange rate changes.
Argentina all over again? Lessons for Europe
Augusto de la Torre, Eduardo Levy-Yeyati & Sergio Schmukler (VoxEU) Mar 6, 2010
The fiscal crisis in several European countries has led many commentators to suggest novel solutions, including a holiday from the euro. This column examines the much-cited example of Argentina and argues that such ideas look better on paper than in practice. What these countries need is a “good old bailout” – conditional on “getting the house in order”.
Why policymakers need to take note of high-frequency finance
Richard Olsen (VoxEU) Mar 6, 2010
Why should high-frequency finance be of any interest to policymakers interested in long-term economic issues? This column argues that the discipline can revolutionise economics and finance by turning accepted assumptions on their head and offering novel solutions to today’s issues.
The political limits to globalisation
Daron Acemoglu & Pierre Yared (VoxEU) Mar 7, 2010
Is globalisation inevitable and irreversible? This column argues that globalisation is a policy choice. It examines the relationship between military expansion and international trade flows, finding that increased nationalist and militarist sentiments are negatively associated with trade. A 10% increase in military spending between 1985 and 2005 is associated with a reduction in the trade share of GDP of around 2%.
For a fair treatment of trade finance under Basel III
Marc Auboin (VoxEU) Mar 7, 2010
Trade finance is an essential facility for world trade. But this column argues that the safe, short-term, and self-liquidating character of trade finance has not been properly recognised under the Basel II framework and the proposed revised rules ("Basel III") seem to raise additional hurdles to trade finance. Both trade financiers and regulators should strive to avoid this.
Why the euro will continue to weaken
Wolfgang Münchau (FT) Mar 7, 2010
We have always known a monetary union cannot exist without political union in the long run.
How banks can help the world’s poor
Alexander Friedman (FT) Mar 7, 2010
The financial crisis wreaked havoc with poor nations. Banks may have played a central role in causing this suffering, but they can also help lead the way out.
An Irish Mirror
Paul Krugman (NYT) Mar 7, 2010
The financial crisis in Ireland offers clues about our own, and about how to prevent another one.
Trade Deficits and Fiat Currencies
Robert P. Murphy (Mises Daily) Mar 8, 2010
There is a connection between fiat currencies and trade deficits, and many cynics have argued that the US dollar's status as global reserve currency allowed Americans to consume more than they produced for decades. However, this "deficit without tears" argument is sometimes overstated. To gain a deeper understanding of both monetary theory and international trade, it's useful to probe the issue more carefully.
A tale of two depressions: What do the new data tell us? February 2010 update
Barry Eichengreen & Kevin H. O’Rourke (VoxEU) Mar 8, 2010
This column updates the original Vox columns by Barry Eichengreen and Kevin O’Rourke comparing today’s global crisis to the Great Depression. The three previous columns have shattered all Vox readership records with over 450,000 views. This latest edition covers up to February 2010 showing that, while there is cause for optimism, there is no room for complacency.
Antidumping: Much ado about nothing?
Hylke Vandenbussche & Maurizio Zanardi (VoxEU) Mar 8, 2010
The global crisis has raised fears that governments would engage in a protectionist spiral. This column argues that, while countries have by and large kept their promises not to raise barriers to trade, antidumping has crept up. Far from being a “small price to pay”, the new tough users of antidumping laws such as Brazil, India, Mexico, Taiwan, and Turkey have 5.9% fewer annual imports as a result.
The Euro Has Been a Smashing Success
George Melloan (WSJ) Mar 8, 2010
Greeks knew it would be a boon to taverna keepers to share a currency with rich German tourists.
Foreign Aid and Salvadoran Corruption
Mary Anastasia O'Grady (WSJ) Mar 8, 2010
The World Bank should audit former President Tony Saca.
Why Europe needs its own IMF
Giancarlo Corsetti and Harold James (FT) Mar 8, 2010
Historical flaws in the continent’s single currency are threats to stability and need to be fixed.
A social vision for the world after socialism
John Lloyd (FT) Mar 8, 2010
Capitalism need not conform to Adam Smith’s rules of marketplace behaviour as interpreted by our financial masters of the universe.
Shorting US Treasuries could be a mistake
Dino Kos (FT) Mar 8, 2010
There are reasons to expect the Treasury market to hold its own, and perhaps even surprise with lower yields.
Greek Bailout Needs IMF `Bad Cop' to Relieve Euro
Matthew Lynn (Bloomberg) Mar 9, 2010
“Who you gonna call?” wasn’t just a catchphrase in the 1984 film “Ghostbusters.” If the worst happens in Greece, Spain or Portugal, we’re going to hear it all over again, and Europe’s taxpayers will want to know the answer.
Greece fatigue
Anne Applebaum (WP) Mar 9, 2010
Why you can't blame the Germans for being unwilling to bail out the Greeks.
Germany's eurozone crisis nightmare
Martin Wolf (FT) Mar 9, 2010
The twin imperatives of sound money and European integration are clashing. Ironically, Germany must become less German if the eurozone is to become more so.
Greece Is Not an Island
George A. Papandreou (NYT) Mar 9, 2010
Greece is taking tough steps to fix its economy, but the E.U. and U.S. also need to make changes.
Somalia Food Aid Bypasses Needy, U.N. Study Finds
NYT Mar 9, 2010
As much as half the food aid sent to Somalia is diverted to a web of corrupt contractors, Islamist militants and local U.N. staff, according to a report.
The political resource curse
Fernanda Brollo, Tommaso Nannicini, Roberto Perotti & Guido Tabellini (VoxEU) Mar 10, 2010
Is the discovery of natural resources necessarily a good thing? Examining data from Brazil, this column finds that a 10% windfall in government revenues leads to a 12 percentage point increase in corruption and a 3 percentage point reduction in the probability that politicians have a degree. The chance that an incumbent is reelected raises by over 4 percentage points.
Athens and the 'Speculators'
WSJ Mar 10, 2010
Blaming the very folks who buy Greek debt.
Ruble Rally Powers Ahead
Andrei Ostroukh and Toni Vorobyova (Forbes) Mar 10, 2010
Tax payments will only add to the momentum next week as the Russian currency hits a 14-week high.
2010 Shaping Up as a Bad Year for Doha Deal, Climate Talks
Bridges Weekly Trade News Digest, Volume 14, Number 9 Mar 10, 2010
2010 was the year in which two long-running sets of global negotiations were supposed to finally end in agreement: the WTO's Doha Round of trade talks and multilateral negotiations to secure a deal to curb emissions of greenhouse gases. But fewer than 10 weeks into the year, officials involved in both sets of talks are issuing gloomy predictions for the odds of deals being struck during the remainder of 2010.
Spain has the means to avoid Greece’s fate
Luis Garicano (FT) Mar 10, 2010
This is a three-point plan to help Spain, which was particularly exposed by the recent financial crisis, avoid becoming the next Greece.
Debunking the myth of a China collapse
Jing Ulrich (FT) Mar 10, 2010
Global sentiment towards China's economy and asset markets has turned from exuberance just a few months ago to overriding concern about the side-effects of last year's remarkable credit growth.
China's bubble trouble
David Ignatius (WP) Mar 11, 2010
China's export-led growth will be the biggest hindrance to its economic expansion.
No exit
Hossein Askari and Noureddine Krichene (AT) Mar 11, 2010
Countries that make up the Group of 20 insist that there can be no exit from crisis-fighting policies until economic recovery has been fully established. But as these policies may have helped cause the problem, is escape from crisis possible with them still in place?
Africa Rebounding Almost in Line with World Recovery
IMF Survey Mar 11, 2010
IMF chief Dominique Strauss-Kahn says he is optimistic about Africa's economic prospects in the wake of the global economic crisis and that the continent is bouncing back after the recession.
China, America and exchange rates
Economist Mar 11, 2010
The best thing American politicians can do to encourage a stronger Chinese currency is keep calm.
China lassoes its neighbors
Walden Bello (AT) Mar 12, 2010
The China-ASEAN Free-Trade Area, which came into effect in January, should boost China's trade with its neighbors. It will also likely erode Southeast Asia's industry and agriculture. Smaller economies in the region are already paying what will be a big price for a bad deal.
No Credit
John Cassidy (New Yorker) Mar 15, 2010
Timothy Geithner’s financial plan is working—and making him very unpopular.
Greek Lessons for Europe
Joschka Fischer (Project Syndicate) Mar 2010
Europe’s leaders – first and foremost Germany and France – must act quickly to defuse the Greeck crisis. Doing so will not come cheap, and therefore will entail substantial political risks, but, given a global economic environment that promises scant sustainable growth in the coming years, things could get very tough very soon for the euro zone if they do nothing.
Can Asians Resolve Global Problems?
Simon Chesterman and Kishore Mahbubani (Project Syndicate) Mar 2010
In the past, Asians put a premium on protecting their sovereignty and were wary of any multilateral approaches that could dilute it. Now, in response to global challenges – for example, pandemics, financial crises, and climate change – the vast majority of Asian countries understand that collective action does not erode but instead protects sovereignty.
Time to outlaw naked credit default swaps
Turning the Corner in Eastern Europe
Thomas Mirow (Project Syndicate) Mar 2010
Many countries in Central and Eastern Europe were hit hard by the global financial crisis, owing to a massive build-up of debt - much of it in foreign currencies - during the boom years that preceded it. Sustainable recovery will require the development of strong local capital markets, as well as stronger institutional and regulatory frameworks – and not just at the national level.
Japan’s Slow-Motion Crisis
Kenneth Rogoff (Project Syndicate) Mar 2010
Investors who have bet against Japan in the past have been badly burned, grossly underestimating the Japanese people’s remarkable flexibility and resilience. But, while Japan’s ability to trudge on in the face of huge adversity is admirable, the risks of crisis ahead are surely greater than bond markets seem to recognize.
Could A Global Trading “Network Map” Prevent Another Crisis?
Janice Fioravante (II) Mar 2010
As far-fetched as a master "network map" of the world’s securities activity sounds, it has some quite serious proponents.
The Global Roots of Euro-Jitters
Harold James (Project Syndicate) Mar 2010
It is too simplistic to explain the current wave of concern about the euro in terms of Greece’s problems. The euro’s current problems are, instead, a reflection of Europe-wide and global problems that have remained unresolved for the past 30 years.
Complexity and Collapse
Niall Ferguson (Foreign Affairs) Mar/Apr 2010
Imperial collapse may come much more suddenly than many historians imagine. A combination of fiscal deficits and military overstretch suggests that the United States may be the next empire on the precipice.
The Dangers of Deficit Reduction
Joseph E. Stiglitz (Project Syndicate) Mar 2010
Even with large deficits, economic growth in the US and Europe is anemic, and forecasts of private-sector growth suggest that in the absence of continued government support, there is risk of continued stagnation – of growth too weak to return unemployment to normal levels. if these forecasts are right, a premature “exit” from deficit spending is not worth the risk.
The End of an Era in Finance
Dani Rodrik (Project Syndicate) Mar 2010
In the world of economics and finance, revolutions occur rarely and are often detected only in hindsight. But what happened on February 19 can safely be called the end of an era in global finance.
Too big to fail
Serge Halimi (La Monde) Mar 2010
States rescued the banks in country after country, neither asking nor getting anything in return. The banks are now using their newfound strength against the state, threatening to reveal the accounting tricks the banks themselves had recommended to hide some of the debt. After all, interest rates on loans are higher when the financial reputation of the state is in question.
How to Handle the Sovereign Debt Explosion
Mohamed El-Erian (PIMCO) Mar 2010
We should all be paying attention to the deterioration in the public finances of many advanced economies.