The GEM team is certainly hitting the tapes at the moment with Edward featured by the NYT and CNN as well as I was recently contacted by Adam Kritzer who is a lead editor on Forexblog, arguably the best one stop resource for people interested in FX (trading). He asked me whether I would answer some questions about macroeconomics and FX markets. You can see his questions and my answers below.
Sovereign risk and debt continues to mark the fault lines in the global macro landscape and thus the main discourse. In this context and although the technical recovery is still a reality the discourse has started to move into a decidedly bearish mood. I find this interesting since while financial markets, in traditional fashion, have reacted strongly and early on the sovereign debt crisis in Europe it is only now that we are about to close the book on H01-2010 that we are seeing significant and lingering worries from all sides that the we are headed straight into a double-dip recession.
Yours truly is actually a macroeconomist, indeed with a knack for financial markets, but still; a macroeconomist nonetheless. However, you would not have gotten that impression from the writings here end last week where I worried a lot about the worry of financial markets. I still do, worry that is, mostly because we are in a very delicate situation where a severe shock in financial markets can easily and quickly be transmitted into the real economy. Moreover and as Edward eloquently conveys in his recent post the structural challenges we face are complex and difficult.
As we are about move into the fourth day of the week where EU policy makers together with the IMF and the ECB launched an unprecedented series of aid tools to combat the mounting risk of a collapse in Greece and elsewhere in the European periphery I am finally ready to move in with some comments. First of all, there has been no shortage of comments, opinions and market calls on the back of the bailout package and while risky assets have indeed rallied, it is if the underlying reality of the situation looms ever more prescient underneath the surface than what one would have expected from such a colossal dose of stimulating policy.
With so much going on at the moment and so many themes fighting to claim the main market discourse, I am in the mood for some random shots. First of all and to my continuing regret I have never actually got to thank Niels C. Jensen from Absolute Return Partners for the nice coverage I got way back in October 09 when Mr. Jensen discussed my thoughts on demographics and the life cycle.
Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.
As we move into year’s and perfectly in line with seasonal regularity we are flooded by a veritable tsunami of sell and buy side research on the big themes of 2009 and those to come in 2010. Now, we can add another to the list in the form of the latest quarterly review from BIS […]
“In my view … it is impossible to understand this crisis without reference to the global imbalances in trade and capital flows that began in the latter half of the 1990s.” Bernanke (2009) Executive Summary Compared with the average quarterly value of GDP in 2007-08, the first two quarters of 2009 are down in nominal […]