Posted by hkarner - 23. Februar 2015
Benjamin Born, Gernot Müller, Johannes Pfeifer 22 February 2015
Many observers blame austerity for much of the Eurozone’s current economic woes. This column presents new evidence on how financial markets assess austerity. Cutting government consumption raises the sovereign default premium in the short run. However, austerity pays off in the long run.
Ever since their emergence in the wake of the financial crises, austerity policies have been hotly debated (see, for example, Corsetti 2012). The recent electoral outcome in Greece is just one instance where discontent with austerity manifests itself. Many observers and voters are ready to jump from jointly observing poor economic outcomes and austerity to the conclusion that austerity is indeed the cause (see, for instance, Blyth 2013). Others have provided sophisticated analyses in support of the same view (see Taylor 2013). Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Born; Müller; Pfeifer, Euro, voxeu | Leave a Comment »
Posted by hkarner - 5. Februar 2015
Source: Project Syndicate
JOSEPH E. STIGLITZ
Joseph E. Stiglitz, a Nobel laureate in economics and University Professor at Columbia University, was Chairman of President Bill Clinton’s Council of Economic Advisers and served as Senior Vice President and Chief Economist of the World Bank. His most recent book, co-authored with Bruce Greenwald, is Creating a Learning Society: A New Approach to Growth, Development, and Social Progress.
NEW YORK – When the euro crisis began a half-decade ago, Keynesian economists predicted that the austerity that was being imposed on Greece and the other crisis countries would fail. It would stifle growth and increase unemployment – and even fail to decrease the debt-to-GDP ratio. Others – in the European Commission, the European Central Bank, and a few universities – talked of expansionary contractions. But even the International Monetary Fund argued that contractions, such as cutbacks in government spending, were just that – contractionary.
We hardly needed another test. Austerity had failed repeatedly, from its early use under US President Herbert Hoover, which turned the stock-market crash into the Great Depression, to the IMF “programs” imposed on East Asia and Latin America in recent decades. And yet when Greece got into trouble, it was tried again. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Greece, Project Syndicate, Stiglitz | Leave a Comment »
Posted by hkarner - 31. Januar 2015
Greek election victor Alexis Tsipras wants an entirely different Europe from the one envisioned by Angela Merkel. His success is likely to stoke anger over Germany’s EU dominance. Leaders in France and Italy are also hoping for an end to austerity.
Alexis Tsipras couldn’t have picked a more symbolic place to show his voters that he is a prime minister like no other Greece has seen before — — and that he is truly serious about standing up to the Germans.
On Monday, right after he was sworn in, he was chauffeured in his sedan to the Kesariani rifle range, a memorial to Greek resistance fighters that is revered in the country as the “altar of peace.”
It was here, on the outskirts of Athens, that German occupying troops shot a total of some 600 resistance fighters — some just before the end of the war, on May 1, 1944 — along with roughly 200 communists from the Haidari concentration camp. The youngest victim was only 14 years old.
As Tsipras stepped out of his car and made his way through the park to the memorial stone, several hundred people crowded around him. People reached out to touch, congratulate, hug and kiss him. The few bodyguards surrounding the politician barely shielded him from the crowd, apparently as he desired. Alexis Tsipras, 40, the youngest prime minister in Greek history, also intends to be its most unusual leader — a man of the people who is determined to fundamentally change his country. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Euro, Europe, Germany, Greece, Spiegel, Tsipras | Leave a Comment »
Posted by hkarner - 26. Januar 2015
Source: The Economist
Across Europe, Syriza’s victory was welcomed (and deplored) as a blow to austerity
Alexis Tsipras celebrates his victory
SYRIZA’S unequivocal victory in Sunday’s Greek elections reverberated all over Europe. It had been widely assumed that the left-wing populists and their charismatic young leader, Alexis Tsipras (pictured), would win a plurality of the votes, but the margin of victory was at the high end of expectations. In other European countries, Syriza’s win gave inspiration to populist anti-austerity parties on the left and right. European governments, meanwhile, issued diplomatic congratulations to the victors, while quietly worrying that the deals struck during years of negotiations, to rescue Greece from default and keep it in the euro zone, will now be torn open.
Syriza’s winning margin over the incumbent New Democracy party of Antonis Samaras fell just short of an outright governing majority. Including the 50-seat bonus which Greek election rules grant to the party with the largest share of the vote, Syriza mustered 149 seats in the 300-member parliament. Mr Tsipras moved swiftly to consolidate his victory. On Monday morning he launched coalition talks with an unlikely but willing candidate: Panos Kammenos, the leader of the Independent Greeks, a small right-wing party. Mr Kammenos quickly announced that the two parties had struck a deal. Although opposed to Syriza in their overall ideology, the right-wing Independent Greeks share Syriza’s antipathy to the terms of Greece’s bail-out, and its attendant dose of stringent government austerity.
With 13 seats, Mr Kammenos could provide a workable majority for a Syriza government. One Syriza aide says Mr Tsipras might even announce his cabinet by Monday evening. Mr Tsipras was also due hold talks later on Monday with Stavros Theodorakis, leader of To Potami (The River), a centre-left party entering parliament for the first time. Mr Theodorakis would refuse to join a Syriza-led government but could provide additional parliamentary support. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Economist, Greece, Tsipras | Leave a Comment »
Posted by hkarner - 23. Januar 2015
Source: Paul Krugman
The United States and Europe have a lot in common. Both are multicultural and democratic; both are immensely wealthy; both possess currencies with global reach. Both, unfortunately, experienced giant housing and credit bubbles between 2000 and 2007, and suffered painful slumps when the bubbles burst.
Since then, however, policy on the two sides of the Atlantic has diverged. In one great economy, officials have shown a stern commitment to fiscal and monetary virtue, making strenuous efforts to balance budgets while remaining vigilant against inflation. In the other, not so much.
And the difference in attitudes is the main reason the two economies are now on such different paths. Spendthrift, loose-money America is experiencing a solid recovery — a reality reflected in President Obama’s feisty State of the Union address. Meanwhile, virtuous Europe is sinking ever deeper into deflationary quicksand; everyone hopes that the new monetary measures announced Thursday will break the downward spiral, but nobody I know really expects them to be enough. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Europe, Krugman, NYT, QE, USA | Leave a Comment »
Posted by hkarner - 8. Januar 2015
07.01.2015 | 18:30 | Josef Urschitz (Die Presse)
Kann es sein, dass unsere Voodoo-Ökonomen auf dem Holzweg wandeln?
Gestern haben uns zwei verwirrende Nachrichten erreicht: In Italien ist die Arbeitslosenrate in diesem Winter auf 13,4 Prozent und damit auf den höchsten Wert seit Beginn der Aufzeichnungen (das war 1977, vorher hat das dort offenbar niemanden interessiert) gestiegen. In Deutschland ist sie gleichzeitig auf 6,3 Prozent und damit auf den tiefsten Wert seit der Wiedervereinigung gesunken.
Verwirrend deshalb, weil die Deutschen heuer ja einen annähernd ausgeglichenen Staatshaushalt aufweisen, während Italien an der Drei-Prozent-Grenze der Maastricht-Kriterien entlangschrammt. Und uns unsere Ökonomenfreunde von der immer größer werdenden Voodoo-Fraktion nicht erst seit dem Wiederaufflammen der Griechenland-Krise mantraartig erklären, dass man aus hohen Schulden am besten mit noch mehr Schulden „herauswächst“, während Austerität à la Deutschland samt der dazugehörigen Arbeitsmarkt- und sonstigen -reformen geradewegs ins ökonomische Verderben führt. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Euro, Finanzkrise, Germany, Italy, Presse, Unemployment, Urschitz | Leave a Comment »
Posted by hkarner - 4. Januar 2015
Dass der griechische Linkspopulist Alexis Tsipras gewählt werde, ist keine Gefahr für die Union, sondern eine Chance, nicht nur für Griechenland selbst. Eine vehemente Widerrede zu Joschka Fischers Kommentar im Standard vom 30. 12. des vergangenen Jahres
Am vorletzten Tag des Jahres 2014 hat der einstige deutsche Außenminister Joschka Fischer im Standard einen unerwartet kläglichen Kommentar veröffentlicht. Dieses Versagen eines Politikers, der einst auf die Rolle des Rebellen abonniert war, ist psychologisch aufschlussreich, weil es vor Augen führt, dass die Gelegenheit, mit den Mächtigen der Welt von gleich zu gleich zu verkehren, auch jenen nicht guttut, von denen man geglaubt hätte, dass sie sich ihr Denken nicht gar so rasch vom Jargon der Macht zersetzen lassen. Wichtiger ist, dass die Fischer’sche Warnrede zudem zeigt, wie die vermeintlichen Retter der Europäischen Union diese in Wahrheit jenem Abgrund näher treiben, vor dem sie warnen.
Die neueste Krise, werden wir nicht nur von Fischer belehrt, heißt wie die alte, nämlich Griechenland. Menschen, denen das Wort “Finanzmärkte” nicht mit heiligen Schauern von den Lippen kommt, als gelte es einer göttlichen Macht zu huldigen, haben sich schon vor Jahren gewundert, dass ausgerechnet ein Land, das exakt 1,5 Prozent zur europäischen Ökonomie beiträgt, das reichste Europa, das es in der Geschichte jemals gegeben hat, in den Ruin führen sollte. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Gauß, Greece, Standard | Leave a Comment »
Posted by hkarner - 6. Dezember 2014
Source: The Economist
The euro zone’s newest member faces an uphill struggle
A ticket to Taiwan
ON JANUARY 1st Lithuania will become the 19th member of the euro zone. The small Baltic state of 3m people is one of Europe’s fastest-growing economies.
The euro zone is on the verge of recession and deflation. So why does Lithuania want to adopt the single currency?
Fewer than half of Lithuanians are keen, according to a recent survey by Eurobarometer. But, like all countries that joined the European Union after the euro’s creation, Lithuania is obliged to. Since 2002 it has pegged its currency, the litas, to the single currency. It tried to join in 2007, but was rebuffed on the grounds that its economy was out of sync with the euro zone’s.
It still is. Since 2011 the euro zone has stagnated; Lithuania’s GDP has grown by 4.3% a year. Its ratio of government debt to GDP is among the lowest in the EU. Moreover, this impressive performance is the result of the sort of root-and-branch reform most euro-zone countries have shirked. In response to a domestic financial crisis in 2009—a hangover from a credit bust in which GDP dived by 15% and unemployment hit 18%—Lithuania swiftly enacted austerity. From 2009 to 2013 the government slashed spending by 10.5 percentage points of GDP—more than any other country in the EU. It slimmed its budget deficit from 9.3% to 2.6% of GDP. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Economist, Euro, Lithuania | Leave a Comment »
Posted by hkarner - 3. Dezember 2014
Source: Project Syndicate
Nouriel Roubini, a professor at NYU’s Stern School of Business and Chairman of Roubini Global Economics, was Senior Economist for International Affairs in the White House’s Council of Economic Advisers during the Clinton Administration. He has worked for the International Monetary Fund, the US Federal Reserve, and the World Bank.
NEW YORK – The recent decision by the Bank of Japan to increase the scope of its quantitative easing is a signal that another round of currency wars may be under way. The BOJ’s effort to weaken the yen is a beggar-thy-neighbor approach that is inducing policy reactions throughout Asia and around the world.
Central banks in China, South Korea, Taiwan, Singapore, and Thailand, fearful of losing competitiveness relative to Japan, are easing their own monetary policies – or will soon ease more. The European Central Bank and the central banks of Switzerland, Sweden, Norway, and a few Central European countries are likely to embrace quantitative easing or use other unconventional policies to prevent their currencies from appreciating.
All of this will lead to a strengthening of the US dollar, as growth in the United States is picking up and the Federal Reserve has signaled that it will begin raising interest rates next year. But, if global growth remains weak and the dollar becomes too strong, even the Fed may decide to raise interest rates later and more slowly to avoid excessive dollar appreciation.
The cause of the latest currency turmoil is clear: In an environment of private and public deleveraging from high debts, monetary policy has become the only available tool to boost demand and growth. Fiscal austerity has exacerbated the impact of deleveraging by exerting a direct and indirect drag on growth. Lower public spending reduces aggregate demand, while declining transfers and higher taxes reduce disposable income and thus private consumption. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Central Banks, currency, ECB, Euro, Japan, Project Syndicate, QE, Roubini | Leave a Comment »
Posted by hkarner - 10. November 2014
Source: The Financial Times Wolfgang Munchau
The eurozone has no mechanism to defend itself against a drawn-out depression
If there is one thing European policy makers agree on, it is that the survival of the euro is no longer in doubt. The economy is not doing great, but at least the crisis is over.
I would challenge that consensus. European policy makers tend to judge danger in terms of the number of late-night meetings in the Justus Lipsius building in Brussels. There are definitely fewer of those. But that is a bad metric.
I do not have the foggiest idea what the probability of a break-up of the euro was during the crisis. But I am certain that the probability is higher today. Two years ago forecasters were hoping for strong economic recovery. Now we know it did not happen, nor is it about to happen. Two years ago, the eurozone was unprepared for a financial crisis, but at least policy makers responded by creating mechanisms to deal with the acute threat.
Today the eurozone has no mechanism to defend itself against a drawn-out depression. And, unlike two years ago, policy makers have no appetite to create such a mechanism. Den Rest des Beitrags lesen »
Posted in Artikel | Getaggt mit: austerity, Debt, Euro, Finanzkrise, fiscal compact, FT, Münchau | Leave a Comment »