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Paul Krugman: More Straw

  The Reinhart-Rogoff rehabilitation tour has been really depressing. There are a number of routes they could have gone; unfortunately, they seem addicted to the notion that they can end the discussion by arguing with straw men. I noted one … Continue reading

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Wolfgang Münchau: The riddle of Europe’s single currency with many values

  … In a monetary union, adjustment can only occur through though real movements in wages and prices. Since Germany is not inflating, and is not likely to inflate in the future, I see no chance of that happening, even … Continue reading

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Martin Wolf: Britain’s perilous austerity bunker

  David Cameron’s argument against fiscal policy flexibility are wrong David Cameron’s “there is no alternative” speech last week on the UK economy has aroused much criticism. This is justified. The British prime minister’s arguments for sticking to the government’s … Continue reading

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Beyond the bazooka of eurozone bailouts

  … At this point, we should hear from a German macroeconomist about the unacceptability of such a cheap ploy for the disguised monetary financing of deficits. Before we do, though, let’s consider the deal that Ireland just did with … Continue reading

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Martin Wolf: The sad record of fiscal austerity

  The ECB could have prevented the panic. Tens of millions are now suffering unnecessarily At the Toronto summit of the Group of 20 leading economies in June 2010, high-income countries turned to fiscal austerity. The emerging sovereign debt crises … Continue reading

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Martin Wolf: Weaker pound is welcome but no panacea

  The challenge is to connect monetary and fiscal policy to promote demand while enhancing supply Sterling is falling. Hurrah! The needed rebalancing of the UK economy calls for a further depreciation of the real exchange rate. If the call … Continue reading

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Martin Wolf: Why the euro crisis is not yet over

  If all members of the eurozone would rejoin happily today, they would be extreme masochists ©Ingram Pinn Is the eurozone crisis over? The answer is: “yes and no”. Yes, risks of an immediate crisis are reduced. But no, the … Continue reading

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Martin Wolf: The case for helicopter money

  It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” This comment of Mark Twain applies with great force to policy on money and banking. Some are sure … Continue reading

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Wolfgang Münchau: Ireland shows the way with its debt deal

  Rescheduling of promissory notes is monetary financing in all but name Everybody seemed to be talking about monetary financing of debt last week – the ultimate taboo in monetary policy. And hidden behind a veil of unbelievable complexity, the … Continue reading

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Martin Wolf: A case to reset basis of monetary policy

  Yet proponents of the current regime (of which I was one) justified it not only on the proposition that it would stabilise inflation, but that it would help stabilise the economy. It failed to do so. In terms of … Continue reading

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