The U.S. government must act decisively to rectify its unsustainable fiscal position.
The last thing countries like Spain, Ireland, Greece, Italy, and Portugal need is a strong currency at a time when they are trying to redress their highly compromised public finances in the midst of severe economic recessions.
At its upcoming meeting, the Federal Open Market Committee will likely see little reason to change its monetary policy stance since economic developments have stood very much in line with the Fed's expectations.
2010 threatens to be another challenging year for the global economy.
AEI Online
October 22, 2009
In today's economic context, where an ever-increasing portion of the U.S. budget deficit is being financed by foreigners and where entitlement programs threaten to compound an already highly compromised public finance position, there is real risk of either a destructive burst of inflation or an outright government debt default.
Krishna Guha's article paints too pessimistic a long-term outlook for the U.S. dollar by not focusing on the basic fact that, for there to be a major further U.S. dollar depreciation, the dollar would need to depreciate substantially against the euro and the yen.
There are many reasons to fear that the US economy could stall again early next year and to be deeply concerned about the renewed deflation in Japan and the growing tensions within the eurozone, and what these factors might mean for a meaningful global economic recovery.
Desmond Lachman's response to NationalJournal.com's "Economy Experts" blog on the implications of low saving on economic growth.
As the G20 heads of state ponder policies to support the global economic recovery, they need to recognize that the U.S. consumer is unlikely to be the principle driver of the economy anymore.
Resident fellow Desmond Lachman argues that the stimulus is not helping the economy recover.
The recession is ending, but big risks remain.
Countries with deficits that averaged about 20 percent of GDP have historically proceeded down three divergent paths. This paper discusses the historical evidence along each of these three paths and compares the current U.S. situation to past experiences.
It would not seem premature for policymakers to consider how they should respond should the U.S. economy stall again early next year.
With so many risks still overhanging the fragile U.S. economy, one hopes U.S. policymakers will not allow themselves to be carried away by the equity market's present state of euphoria.
President Obama is turning a blind eye to Ben Bernanke's all too many errors of judgment.
The loss of control over U.S. public finances poses a real long-run risk of high interest rates and high inflation that in turn could reduce the U.S. economy's longer run growth potential.
History is littered with examples of major economic and financial crises in countries that have engaged in profligate public spending. These sad experiences should be raising red flags in the U.S.
There are several good reasons to believe that inflation is not an immediate risk to the U.S. economy and that the Federal Reserve would be ill-advised to exit prematurely from its easing policy.
The Federal Open Market Committee's next meeting will not bring meaningful changes in the Federal Reserve's interest rate policy.
President Obama is just compounding a mess instead of really putting the economy on the right track.
In framing their policy response to the present economic recession, U.S. and U.K. policymakers would do well to take that research seriously rather than to engage in wishful thinking that somehow animal spirits will quickly restore the two economies to their potential growth paths.
If Bernanke were indeed to be reappointed as Fed chairman, it would mean that, in the depths of by far the worst U.S. economic recession in the post war period, one would be reappointing to the job the very person whose fingerprints are all over that recession.
In today's world of widespread loan securitisation, debt-for-equity conversions are no simple matter.
Despite the administration's aggressive and costly economic policy initiatives, there is trouble all around.
A rise in U.S. household savings is a healthy long-run development in that it provides a basis for reducing the large U.S. external imbalance and for increasing domestic investment.
One has to be struck by the degree to which the Obama Administration has underestimated the depth of the current economic recession in setting economic policy at the start of its term.
The Federal Reserve chairman's tenure has been checkered at best. There must be other candidates who could be expected to do a better job.
There's much chatter that the Chinese renminbi will eventually replace the U.S. dollar as the world's preeminent international reserve currency, but this supposed inevitability is highly questionable.
The focus of the Federal Open Market Committee's meeting will be on how recent financial market developments, mainly in reaction to a perceived overly expansionary longer-run budget policy, are putting the incipient recovery at risk.
Before allowing complacency to set in, the Obama administration would do well to heed the clear warnings now emanating out of the U.S. fixed income and dollar markets.
Calling on Europe to help save the Latvian currency peg is all too reminiscent of similar calls in 2000 to save the Argentine Convertibility Plan.
The market is showing its growing unease about the Obama budget.
The Obama budget proposal is now raising major issues of fiscal sustainability for the United States.
A credible long-run fiscal plan should not in any way dilute the short-run fiscal stimulus that the U.S. economy so desperately needs at this time.
The European recession is significantly deeper and is likely to last significantly longer than that in the United States.
As "green shoots" of recovery sprout in the United States, potential crises in a number of European economies pose the main risk to any early global economic recovery.
A key lesson that should be drawn from the bursting of the U.S. housing market bubble is that the Federal Reserve can ill afford to be derelict in the exercise of its regulatory responsibilities.
For the dollar to collapse, it would need to do so against the euro and the Japanese yen, both of which seem substantially weaker than the dollar itself.
Worsening economic conditions will force central banks to resort to more aggressive quantitative easing until the economy recovers.
The European Union wants to cut deficits. What is it thinking?
The Fed will take a breather this week.
If President Obama asked for the most urgent financial reform, global or domestic, needed to rebuild the credibility of the financial system, what would be the answer?
The consumption pattern of Chinese households does not correspond to the output that China's export industries produce.
Time is running out for the European economy.
The Obama administration seems to be doing too little too late in resolving the country's banking crisis.
One has to be struck at the gaping gulf between the Obama administration's diagnosis of what ails the economy and its policy prescription to promote a recovery.
The United States is coming to resemble Argentina, Russia, and other emerging markets, both in what led to this crisis and in how we are trying to fix it.
It has become fashionable to predict the imminent collapse of the dollar. What might really happen?
As the Federal Reserve meets this week, it will be mindful of reams of worrisome data.
The world's policymakers are finally waking up to how synchronized and how severe the global economic crisis is turning out to be.
A coordinated international response should embrace concrete monetary policy, fiscal policy, and exchange rate policy actions.
Throughout his three-year tenure, Ben Bernanke has been painfully slow to do the right thing.
A host of individual euro member countries have marked economic weaknesses that are being severely tested by a global economic slump.
There is likely to be major political fallout from what will be the worst global economic slump in the postwar period.
More important than monetary policy are bold measures that would mend the broken U.S. financial system.
We can expect trouble in the commercial property market and rising corporate defaults. It's time for serious action.
There can be little doubt that China has been manipulating its currency for competitive advantage.
The Fed meets this week amid bad news on labor markets, consumer spending, and industrial production.
Desmond Lachman responds to Joseph Stiglitz's January 16 article in the Financial Times.
By resorting to the Federal Reserve's printing press, Ben Bernanke could easily compromise the country's future growth prospects.
On financial market reform, Obama should adopt the successful Swedish model rather than the failed Japanese one.
There are serious economic problems in Europe that pose a major threat to the euro.
The global recession now poses existential challenges for the euro.
Economists assess President-elect Barack Obama's fiscal stimulus proposals.
Raising gas and carbon taxes would help president-elect Obama meet many of the objectives he advocated during the election.
A major impediment to any economic recovery right now is not that official interest rates are too low but rather that the money multiplier has collapsed.
In all likelihood, the Federal Open Market Committee will soon move toward quantitative monetary policy easing.
It seems that euro membership deprived Spain of an independent monetary policy that might have been used to deflate the Spanish housing market bubble before it became unmanageable.
Now is the time for a bold new economic strategy. Let's hope that Team Obama delivers one.
Hank Paulson's tenure as Treasury secretary has been highly unfortunate for both the U.S. and global economies.
Global financial markets want an immediate, bold, and coordinated policy response. G-20 members did not provide it.
AEI Online
November 14, 2008
The current financial crisis will force Obama to put his long-term agenda on the back burner.
Wolfgang Münchau seems to be wide of the mark in asserting that the present global financial crisis will lead to the early expansion of the eurozone.
The current financial crisis will force Obama to put his long-term agenda on the back burner.
Plunging global equity prices and frozen global credit markets are leading Europe into the start of its worst economic recession in the postwar period.
It is likely that today's global financial market crisis will mark the end of any serious challenge by the euro to the U.S. dollar as an alternate international reserve currency.
By worrying about inflation, even after commodity bubbles have burst, central bankers are risking economy-killing deflation.
Why have the government's efforts to right the economy not yet succeeded?
When the dust settles on today's crisis, the world will find itself with a radically changed financial system.
Even if a quick solution were to be found for the banks' capital inadequacy problem, it is unlikely that the hedge funds' deleveraging process would be arrested.
Major government intervention is needed to stabilize housing prices and arrest the alarming rate of foreclosure that threatens to add to bank loan losses.
The damage to the public financesresulting fromthe financial crisis will require the scaling back of aspirations in other areas of fiscal policy.
What should we make of the proposed government bank bailout?
The idea that the Federal Reserve has been overly accommodative is a dangerous myth.
Henry Paulsonnow has the unenviable task of picking up the pieces from the bursting of the largest housing and credit market bubbles in memory.
Recent economic data paint a gloomy picture for Europe.
The Fed should not hike interest rates until it has clear evidence of stabilization in the housing and credit markets.
How should the next president handle economic issues?
Congress should be grappling with the pressing issue of how to put a brake on the present downward spiral of the housing market.
Central bankers should have figured out that the credit crunch is more than just a liquidity dilemma.
Before considering a second stimulus package, Congress should consider why the first package failed to jumpstart the economy.
It is difficult to see how theUnited Statescan avoid a prolonged recession once the stimulatory effect of the present tax rebate program abates later in the year.
Lachman pushes for a floating exchange rate in theGulf countries.
At times of economic crisis, a number of U.S. presidential elections have proved to be watershed economic events.
Amore flexible exhange rate is part of the solution to the Asian and Middle Eastern inflation policy.
Will the U.S. economy improve or worsen between now and Election Day in November?
The U.S. equity market still seems to believe that, whatever recession we might have had at the start of this year, a recovery is on the way.
If elected, McCain will need to devise a concrete plan that can heal the U.S. economy.
Oil prices cannot keep rising forever, despite what many of today's market participants seem to think.
As the Euro celebrates its tenth birthday, its next decade remains uncertain.
If further significant increases in oil prices would push the U.S. economy into a meaningful and protracted recession, can they be sustained?
Past experience with oil price increases would suggest that, if sustained, such a run-up in oil prices could shave a full percentage point off U.S. GDP growth in the near term.
Reports of the end of the U.S. recession are premature.
Simultaneous shocks to the economy may push theUnited Statesinto a prolonged recession that will further intensify the credit crisis once the temporary tax rebate plan fades.
Europe is going through a macroeconomic crisis.
Despite some positive labor market reforms,Sweden's bloated welfare system and crushing tax burden remain entrenched.
The International Economy
April 24, 2008
Ten years from now, what will be the next great global currency?
Stabilizing the housing market appears to be a necessary condition for breaking the present cycle between a weakening economy and a deteriorating financial system.
The new director of the International Monetary Fund has hit the ground running with bold reform recommendations.
In order to protect U.S. taxpayers, the Federal Reserve should address financial problems transparently.
Amid widespread financial turmoil and talk of recession, fivescholars atAEI graded and assessed the Federal Reserve’s recent policy decisions.
The current economic debate about a possible recession has evolved into a discussion on how long is it going to be and how severe.
At this time of global financial turmoil, one has to marvel at how Brazil's standing has risen in world financial markets.
The case for maintaining open international financial markets must be weighed against legitimate political concerns.
The incoming Spanish prime minister will have to deal with theincreasing problems in the Spanish housing market.
Financial problems should not be solved by resorting to failed capital market controls, but rather by reinvigorating prudential regulatory financial market oversight and managing the exchange rate.
Greenspan will have to be called to account for regulatory failings and his interest rate policy.
It is doubtful that either the Bush administration or the Fed can prevent a nasty recession from occuring.
For the sake ofthe global economy's health, China must rebalance its economy away from exports and towards domestic demand.
The latest interest rate cut is too late to prevent a recession in the first half of 2008, but it does give hope that the Federal Reserve will not repeat the mistakes of the Great Depression.
Despite what you may have heard, global economic linkages remain strong.
The currently strong Russian economy may soon be slowed down.
The Fed must act to loosen monetary policy in the face of the deflating housing and credit bubbles.
Assessing the wisdom of setting up sovereign wealth funds in Latin America depends on a judgment about the relative importance of the existing funds in the global economy.
Will Chinabe able to sustain its past very rapid rare of economic growth in the event that its exports are increasingly shut out of Western markets?
The U.S. economy is at present being hit by three simultaneous shocks that threaten a nasty recession that will more than likely unleash strong deflationary forces.
Central banks would be ill advised to look solely in the rearview mirror when assessing the inflationary outlook.
As estimates of subprime mortgage related losses in the financial system mount, there is every indication that the housing market woes will spread to the rest of the U.S. economy.
There is real concern that the declineinthe dollar could quickly become a freefall.
It is too soon to drawdefinitive conclusions on the extent of the economic damage wrought by the ongoing U.S. housing market bust.
It is a mistake to think that the housing market slumpwill permanently improve the U.S. current account deficit.
Latin America should expect a kinder and a gentlerInternational Monetary Fundunder DominiqueStrauss-Kahn's leadership.
Requiring mortgage originators to hold at least part of the mortgages they originate would establish powerful incentives for all originators to exercise better due diligence in making loans.
The U.S. economy continues to play asubstantial role in the global economy.
Barney Frank's home-lending reform bill could seriously impede the proper function of the U.S. mortgage market.
Despite Wall Street's optimism, the U.S. economy may be headed for a recession.
The European Central Bank acts as if it is oblivious to the U.S. dollar's free fall.
The International Monetary Fund is cheerleading for the world economy, not leading on currency policy.
Timing is everything when central banks respond to financial crises.
Will thecredit crunchlast longerthan previouscrunches?Will it be being accompanied by otherfactors that might also weigh heavily on the U.S. economy?
Will Federal Reserve Chairman Mr. Bernanke respond to the present financial market crisis with sufficient force and timeliness?
How might the present debt crisis differ from and be very much more serious than its predecessors?
The home market issues facing Congress are not easy and not amenable to quick fixes.
TheFederal Reserve will have to act very swiftly to avert what could become a major recession.
The U.S. economy heads down the path toward deflation.
On the subprime mortgage bust.
Most Wall Street analysts still fail to recognize the gravity of the U.S. housing market situation.
China's currency is still egregiously undervalued, and neither the IMF nor the U.S. treasury secretary seems to want to do anything about it.
The origins of the current crisis in the U.S. subprimemortgage market date back to the early 1980s.
What can Wall Street analysts tell us about the U.S. housing market and the subprime mortgage lending crisis?
Dominique Strauss-Kahn will face two significant challenges when he becomes managing director of the IMF in October.
Nowis the ideal time to revaluate the relevance and purposes of both the IMF and World Bank.
The Fed seems blind to the severity of the housing slump--a potentially very costly error.
Robert Zoellickcan succeed at the World Bank if he first listens to his new colleagues. Butwhether the Bank willundergo the changesit so badly needs is uncertain.
Let us hope that Asian and Latin American countries learn from the perils of the euro and avoid forming currency unions.
In Argentina, anappreciating currency can help to reduce inflation without compromising a country's long-term growth prospects.
The World Bank needs a new president who is not only politically appealing--it needs someone to fundamentally change the way the Bank does business.
What is the future of the World Bank? How will Latin America be affected?
AEI scholars debate the relevance of the International Monetary Fund.
Is the World Bank relevant in today's global economy?
As the weakening housing market drags down the dollar, the euro will have to bear most of the burden.
The International Monetary Funds persists in the view that the United States will have the softest of soft economiclandings, despite currency issues.
TheInternational Monetary Fundinsists that the U.S. housing market downturn will not affect the world economy.
In the run-up to the 2008 election, it is likely that home prices willfall at an accelerating pace.
It would be a grave mistake for Ben Bernanke to allow his wishful thinking to influence his interest rate decisions in the months ahead.
The Federal Reserve should stand ready to soften the fallout from the coming housing bust.
Lower home prices could strain an over-leveraged financial system and induce U.S. households to reduce consumption significantly in response to declining wealth levels.
The abrupt turn in the subprime housing market occurred in a reasonably strong economy. The Fed should ask what would happen to the housing market were the economy to weaken.
As the euro rides high, an unhealthy sense of complacency pervades European capitals about the currency's long-run viability.
Global payment imbalances between the United States and the Asian economies are now at their widest level in the past sixty years.
As tensions mount, theInternational Monetary Fundis surprisingly passive in defusing the risks of protectionism and disorderly financial markets.
If those countries aspiring to euro membership need greater policy flexibility prior to euro membership, surely they will also need greater policy flexibility after euro adoption.
China continues to manipulatethe yuanto its own advantage.
As emerging market economies find themselves booming with global liquidity, it is the bloated International Monetary Fund whose finances are in deep trouble andin need of a helping hand.
Among the more disappointing aspects of US international economic policy over the past few years is how little progress has been made in putting Sino-US trade relations on a sounder footing.
If China is to avoid a major protectionist backlash in both Europe and the United States, it will need to wean its economy from its overdependence on exports.
The global economy has not been confronted with so many identifiable risks of such an extraordinarily large magnitude as it is today.
With the very real prospect of a cooling U.S. economy in train, it is difficult to understand why the Fed is now still fretting about inflationary pressures.
TheIMF is now desperately seeking to restore its legitimacy with a radically recharged Asia by persuading on the merits of co-operating to address the large global payment imbalances.
Would a strong Italian government would be able to endure the economic and social pain that would be entailed in a far-reaching program of fiscal retrenchment and labour market reform?
China's stubborn resistance to currency appreciation might have more to do with its political elite's desire not to rock the boat and to remain in power.
Having relied too heavily on a strong rand over the past few years to contain inflation, the Reserve Bank is now going to have to raise interest rates aggressively to counter the inflationary effects of a weaker currency.
The list of recent disturbing political news coming out of the emerging markets is impressive.
Discussants Stephen Roach and Desmond Lachman debate the seriousness of the challenge posed by China and appropriate steps to respond to its rise.
Diverging trends in competitiveness within the eurozone threaten its stability.
Over the past few weeks, there has been a dramatic sell-off in internationally traded commodities as the world’s major central banks continued to drain liquidity.
The timing of Martin Wolf's assertion that the IMF is in financial crisis because of its own success is curious.
Despite the apparent complacency of today's financial markets there is the very real risk that the global economy is in for a hard-landing.
When the world's finance ministers meet in Singapore for the IMF meetings next month, one must hope that they do so both in the spirit of cooperation and with a sense of urgency.
The net upshot is that despite the apparent complacency of financial markets there is the very real risk that the global economy is in for a hard landing.
What is the main reason for the convergence of less developed economies toward developed economies?
Too many of the developed economies have allowed their fundamentals to deteriorate in a disturbing manner.
The Fed has a serious challenge in trying to unwind what it has done to the US housing market.
Despite last month's sell-off in emerging market asset prices, these markets are still pricing the emerging markets as if they were free of the risks that have traditionally characterized them.
Do notunderestimate the potential for further oil price increases to produce stagflation that could pose a real challenge for the Federal Reserve.
The collapse of the rand in South Africa should not have taken policy makers by surprise.
China seems reluctant tomove decisively on the currency issue.
What will happen to the Latin American economies when global growth slows, global liquidity is drained, and international commodity prices decline?
If there are no serious bears left out there, can global markets really continue their relentless upward march?
Over the next year Italy will have no effective government to address the country's chronic economic problems.
President George W. Bush would do well to welcome the 9 per cent effective appreciation of the Chinese currency over the past year.
For while New Zealand and Spain might literally be at opposite ends of the earth, the same two stylized facts characterize their economies.
Will a single currency in Asia produce the same results as it did in Europe?
Does it make sense to extend the euro to the former transition countries, when the existing members are having so much trouble getting it to work?
How will the IMF's managing director handle global imbalances?
Italy'spresent economic and financial predicament is conceptually remarkably similar to that of Argentina in the late 1990s.
An alternation of power through the ballot box from right-of-center to left-of-center governments should be viewed as a healthy manifestation of the democratic process at work.
How reasonable is it to expect that international markets will indefinetly stay open to an ever-increasing volume of Chinese exports?
Despite today’s many identifiable and serious risks to the global economic recovery, most markets are tradingas if the skies were blue.
This Letter to the Editor contests the opinion that emerging-market economies should adopt internationally accepted currencies, such as the US dollar or the euro.
Does the IMF still have a real role to play in the world's middle-income countries?
For China to pose along-term economic threat,it wouldneed to match the U.S.'s sustained productivity performance, which it won't do unless itembraces free-market economics.
It would be a crying shame if Latin America turned up this opportunity to adopt a more outward looking growth strategy, which has served so many other emerging economies so well.
The fact that Argentine policymakers perversely do not draw the correct lessons from their many policy mistakes dooms them to repeat those mistakes.
China's fixed exchange rate is complicating its domestic monetary policy management.
At the start of the year, Paul Volcker, the former Federal Reserve Board Chairman who is not known for being an alarmist, issued an ominous warning.
Conference on the IMF
September 23, 2005
Among the more striking aspects of the International Monetary Fund is how little its financial structure has changed since its inception in 1944.
The International Economy
September 21, 2005
If ever the winds have been strong for Latin America, it has to have been over the past two years.
Financial Times
September 9, 2005
The present energy shock is taking place at a time when U.S. monetary policy accommodation is being withdrawn.
Business Day
August 23, 2005
A dangerous myth is stalking international economic policy-making circles. It is the notion that rising oil prices will not be a drag on global economic growth.
Financial Times
August 10, 2005
The European fiscal stability pact ought to be redefined in terms of cyclically adjusted rather than actual budget targets.
If Italy postpones painful market reforms,it will probably see aprolonged period of economic stagnation and ever-widening budget deficits.
Financial Times
July 20, 2005
There is a pressing need for a revitalization of India's economic reform program if India is to emulate China's impressive economic growth performance.
Australian Financial Review
July 4, 2005
China’s very large macroeconomic imbalances should be alerting us to the risk of a major reversal in China’s economic growth performance within the next couple of years.
Financial Times
June 28, 2005
China is manipulating its currency to maintain an undervalued exchange rate.
Australian Financial Review
June 21, 2005
With therecent"no" votesover theEU constitution, one questions whether Europe is capable of reforms that will allow itssingle currency towork.
Australian Financial Review
June 16, 2005
Only time will tell whether it is the bond market or whether it isAlan Greenspan who has the right call on the U.S. economic-growth outlook.
Tech Central Station
June 3, 2005
The Chinese governmenthas to realize that it mustplay its part in redressing theunprecedented large global payment imbalances; if not, it willunleash strong protectionist pressures abroad.
The Economist
June 2, 2005
A more balanced view might have asked what happens to Australia when commodity prices ebb and when China's investment bubble bursts?
Financial Times
May 19, 2005
Increased flexibility in China’s currency would provide China with a greater degree of monetary policy independence from the United States than its dollar peg affords it today.
Australian Financial Review
May 9, 2005
Alan Greenspan's exhortations to Congress to mend its profligate fiscal ways are falling on deaf ears, prompting Paul Volcker to publicly muse about a global economy skating on thin ice.
Financial Times
May 9, 2005
It is troubling that a resource-rich, commodity-based economy such as Australia's is managing to run an outsized external current account deficit at a time of record-high commodity prices.
Tech Central Station
May 2, 2005
Is not the Bank in need of fundamental restructuring? Might not somebody of Paul Wolfowitz's undisputed ability and vision be the right person to effect such basic change?
Financial Times
April 26, 2005
Chinese policymakers must realize that they cannot expect the U.S. Federal Reserve to take China's circumstances into account when setting monetary policy for the United States.
South African Business Day
April 13, 2005
Steadily rising international oil prices and a sinking dollar should remind the grasshopper thattime is quickly running out andconditions might notremainfavorable much longer.
Tech Central Station
April 5, 2005
William Donaldson's trade-through proposal would be almost certain to stifle the type of market innovation and progress so necessary to keep American markets fair, efficient, and competitive.
Australian Financial Review
April 4, 2005
Perhaps it is time for a revenue-neutral 50 cent per gallon tax on gasoline that would encourage energy conservation and promote the development of alternate energy sources.
Financial Times
March 31, 2005
One might well ask how much sense it makes for Europe to be considering tightening its macroeconomic policy stance.
Emerging-market economieswill foot the bill for Argentina's spectacular triumph over its foreign creditors.
Washington Times
March 23, 2005
President Bush has laid out a bold agenda for Ohio Rep. Rob Portman, his nominee for U.S. trade representative.
Tech Central Station
March 17, 2005
Emerging markets'euphoria over Argentina's triumph in its recent debt reconstructioning negotiations with theInternational Monetary Fundwill likely not last long.
Financial Times
March 1, 2005
U.S. policymakers would be making a grave mistake by ignoring today's large external current account deficit and by blithely going for economic growth.
Tech Central Station
March 1, 2005
Can Europe afford both the straightjacket of the Fiscal Stability Pact and a monetary policy that is backward-looking and solely focused on a headline inflation target?
Financial Times
February 14, 2005
China should bear its share of the adjustments made necessary by thelarge global payment imbalances.
Australian Financial Review
February 8, 2005
The idea circulating in European capitals that the responsibility forbudget and balance of paymentdeficits is solely that of the United States is wrong.
Tech Central Station
February 4, 2005
The days seem to be long gone when the U.S. external finances can afford to be treated with the same benign neglect that they have been treated over the past four years.
The Bush administration should stop tiptoeing around the Chinese exchange rate issue and start putting real pressure on China to move toward a more flexible exchange rate system.
Australian Financial Review
January 17, 2005
The U.S.should take on aleadership role in fashioning a coordinated approach to the problem of greater exchange rate flexibility in Asia and an easier monetary policy in Europe.
Financial Times
December 22, 2004
Would raising interest rates by 450 basis pointsincrease U.S. domestic savings, making room for external adjustment and obviating the need for high U.S. interest rates?
In the absence of effective leadership by either the U.S. Treasury or the International Monetary Fund, there is every prospect that the dollar's recent steady decline will soon turn into a rout.
Financial Times
December 9, 2004
European interest rates at 2 percent do not leave the European Central Bank with much interest rate ammunition even were the bank to want to follow a more aggressive monetary policy.
Chinashould offer greater exchange rate flexibility in return for concrete commitments on the part of the United States to address its budget deficit problem.
The steady decline of the U.S. dollar to record lows on almost a daily basis should be sounding alarm bells in Washington.
Tech Central Station
November 15, 2004
Against the background of remaining financial market vulnerability, one must ask what is the hurry for Brazil to graduate from its International Monetary Fundprogram?
Financial Times
November 12, 2004
Economic theory suggests that an increase in the global labor to capital ratio would result in a less favorable environment for Japanese labor and abetter environment for Japanese capital.
Australian Financial Review
November 4, 2004
After President Bush’s triumph, markets must be expected to focus on the weaknesses presently characterizing the U.S. economy in general and on the budget deficit in particular.
Business Day
November 3, 2004
With the United States’ budget and external deficits now approaching record levels, can we be so sure that international interest rates will remain so favorable for emerging markets?
Financial Times
October 15, 2004
Returning interest rates to more neutral levels would appear to be a less risky course than reacting in a knee-jerk fashion to higher oil prices by raising interest rates.
Tech Central Station
October 11, 2004
Policymakersshould wait and see how permanent the oil price shock proves to be and gauge how damaging is that shock to the global recovery before rushing to tighten economic policies.
The failure to correct the U.S. external deficit soon runs the very real risk of another dollar crisis with all its attendant disruptions to U.S. financial markets and the U.S. economy.
Emerging Markets
October 2, 2004
If far-reaching change is needed at the International Monetary Fund, radical reform and an important downsizing should be the order of the day at the World Bank.
Valor Economico
September 22, 2004
It is difficult to see how Argentina will be able to sustain its recovery over the medium term in the absence of resumed capital flows from abroad and of further reform of the economy.
Financial Times
September 16, 2004
As Argentina uses up the economy’s existing slack, maintaining satisfactory economic growth will require sustained investment and improved productivity performance.
Business Day
September 9, 2004
South Africa's Reserve Bankmust seize the opportunity to build up its international reserves to obviate future wrenching currency gyrations.
A compelling reason for the Federal Reserve to be cautious in responding to the present oil price shock is the weak general macroeconomic environmentwhere that shock is occurring.
Washington Times
September 2, 2004
William Donaldson has sided with the Democratic members of the SEC in a series of important split-vote decisions in favor of investment industry regulation of highly dubious merit.
Finance and Development
September 1, 2004
Historic experience suggests that a currency union similar to that of the Euro will only hold together if that union satisfies the criteria of an optimum currency area.
If the economy shows further signs of weakening, the Federal Reserve will not want to interrupt its program of measured interest rate increases for fear of frightening the markets.
Valor Economico
August 10, 2004
The International Monetary Fund must bear responsibility for nothaving pressedArgentina to move to an appropriate exchange rate regime when the opportunity to do so presented itself.
Alan Greenspan would do well to raise interest rates at a less rapid pace than the markets are presently anticipating.
Business Day
July 27, 2004
The South AfricanReserve Bank’s price stability objective should not be allowed to blind the Reserve Bank to the economic damage that can be wreaked by too volatile an exchange rate.
Financial Times
July 23, 2004
The International Monetary Fund should avoid current proposals to allow countries exceptionally large access to fund credit on a precautionary basis.
Business Day
July 6, 2004
South Africa'sReserve Bankhas a lot to learn from China’s central bank about exchange rate management in today’s highly competitive world.
Valor Economico
June 25, 2004
Spain's Rodrigo Rato takes the helm of the International Monetary Fundat one of the most critical moments in the fund's sixty-year history.
Financial Times
June 23, 2004
Too rapid a restoration of short-term interest rates to more normal levels runs the real risk of an abrupt unwinding of leverage with potentially untoward consequences for the U.S. economy.
Australian Financial Review
June 10, 2004
Too rapid a restoration of short-term interest rates runs the risk of potentially untoward consequences for the U.S. economy.
Chinese authorities are regressing to the blunt instrument of administrative credit and investment controls, whereby the government dictates to the banks how much they might lend.
Venezuela Analytica
May 10, 2004
The probable worsening in the external environment that lies ahead means that Mexico does not have the luxury of waiting till after the next presidential election to reinvigorate its reform effort.
Financial Times
April 30, 2004
Hopefully the arrival of Rodrigo Rato as the new managing director of the International Monetary Fundwill occasion a thorough review of the Fund's lending policy to Argentina.
Valor Economico
April 25, 2004
The International Monetary Fund should make any further IMF lending to Argentina conditional upon Argentina making at least the same primary budget surplus effort as does Brazil.
Australian Financial Review
April 22, 2004
Too much of Australia’s recent macro-economic policy debate has focused on whether and on how the Reserve Bank should prick the perceived housing price bubble.
Financial Times
April 14, 2004
The sooner China moves away from its dollar peg, thebetter toavoid yet another hard landing that would now be particularly damaging to China's fragile banking system.
Business Day
April 6, 2004
The African National Congressshould reflect upon the emerging market economy failures as a result of governments’ failing to take on the special interests that hinder economic change.
International Economy
April 1, 2004
The maintenance of global liquidity conditions will afford the emerging market economies with a window for the strengthening of their underlying macroeconomic fundamentals.
The nomination ofa new managing director for the International Monetary Fund should return the Fund's focus to exchange-rate issues and assistance of countries in fiscal crisis.
The IMF is lending Argentina money to ensure that Argentina does not default on its loans; this actionshould raise basic questions about the wisdom of the IMF's current lending policy.
Valor Economico
March 5, 2004
To join forces now with Argentina in its self-inflicted struggle with the IMF and its international creditors would seem to offer Brazil little upside but potentially large downside risks.
Limiting oneself to regulatory reform of Fannie and Freddie along the lines suggested by Alan Greenspan hardly reduces the risk of repeating the savings and loan type crisis of the 1980s.
Financial Times
February 17, 2004
Having contributed so importantly to Argentina's present debt predicament, should the IMF now not shoulder its fair share of any eventual Argentine debt restructuring?
Financial Times
February 2, 2004
The IMF's present large outstanding loans to Brazil, Indonesia, and Turkey should remind us that Argentina is not the only country that might have difficulty in repaying the IMF.
By maintaining interest rate differentials in favor of Europe, Mr. Trichet runs the risk of fueling the euro's rise against the dollar that would only exacerbate deflationary pressures on Europe.
Financial Times
January 12, 2004
Lula should be encouraged to deepen pension and tax reforms, and to revitalise Brazil's moribund privatisation programme to attract foreign direct investment.
Financial Times
January 7, 2004
Is a monetary union along the lines of Emu a good idea for countries that fail to meet the basic economic criteria of an optimum currency area?
Business Day
December 22, 2003
Canthe ECB and the Reserve Bank be encouraged constitutionally to be overzealous on the inflation front at the expense of economic growth and employment?
Sadly for the global economy, Chinese authorities will not change what they regard to be a highly successful exchange rate peg in the near future
Valor Economico
December 3, 2003
The likely maintenance of favorable global liquidity conditions over the next few months affords the emerging markets with a window for the needed strengthening of their fundamentals.
Beyond introducing greater candor in its surveillance activities, the IMF would restore more transparency to its lending operations.
Business Day
November 28, 2003
Given the dollar's clay feet, it is surprising that Treasury Secretary Snow takes it upon himself to periodically talk down the currency.
Financial Times
November 13, 2003
China would do better to achieve the needed real appreciation of its currency by appreciating the currency in nominal terms.
Financial Times
October 21, 2003
China's ultimate objective must be to float the currency to allow it to find its own level in a world of capital convertibility.
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