Hard to be Easing

The United States Federal Reserve’s decision to undertake a third round of quantitative easing, or QE3, has raised three important questions. Will QE3 jump-start America’s anemic economic growth? Will it lead to a persistent increase in risky assets, especially in US and other global equity markets? Finally, will its effects on GDP growth and equity […]

Nouriel on Bloomberg: TBTF Banks Are Worse Than Before

This morning, Nouriel spoke on “Bloomberg Surveillance” about too-big-to-fail banks (TBTF): “It’s worse than before, because there has been massive consolidation of the banking system in the U.S. JPMorgan took over WaMu and Bear Stearns, Bank of America took over Country Wide and Merrill Lynch. We had banks that were TBTF before the crisis, and […]

Nouriel: Indonesia Still a Compelling EM Story

In Indonesia to speak at the NYSE, Nouriel noted Indonesia’s continuing strong performance among emerging markets. In the two years since Nouriel loudly advocated Indonesia’s status as a major EM, Russia has indeed suffered numerous macro and political setbacks, while Indonesia has continued a process of solid fiscal and macro policy, for laudable growth. The […]

Fiddling at the Fire

Financial markets have rallied since July on the hope that the global economic and geopolitical outlook will not worsen, or, if it does, that central banks stand ready to backstop economies and markets with additional rounds of liquidity provision and quantitative easing. So, not only has good – or better-than-expected – economic news boosted the […]

Early Retirement for the Eurozone?

Whether the eurozone is viable or not remains an open question. But what if a breakup can only be postponed, not avoided? If so, delaying the inevitable would merely make the endgame worse – much worse. Germany increasingly recognizes that if the adjustment needed to restore growth, competitiveness, and debt sustainability in the eurozone’s periphery […]

American Pie in the Sky

From Project Syndicate: While the risk of a disorderly crisis in the eurozone is well recognized, a more sanguine view of the United States has prevailed. For the last three years, the consensus has been that the US economy was on the verge of a robust and self-sustaining recovery that would restore above-potential growth. That […]

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