Here are the ”best” from my posts of the ending week.
EUROPE
European Commission endorses Telegraph view of the
euro – The
Telegraph
Ambrose Evans-Pritchard: I never thought I would live to see
a serving European Commissioner suggest that it was "reckless" to
launch the euro without a lender-of-last resort or fiscal union to back it up.
Eurozone mired in
recession pause – VoxEU.org
Euro-Zone Economy May
Still Be in Recession — Think Tank – WSJ
Growth and improvements in the labour market have been so
anaemic that it is too early to call the end of the Eurozone recession. Indeed,
if this is what an expansion looks like, then the state of the Eurozone economy
might be even worse than economists feared.
Why the euro crisis
still isn’t over, in 1 chart – WaPo
Europe's strategy has been
self-defeating. It's made countries try to cut their public debt and private
debt and wages all at the same time. That's impossible.
Despite lower yields,
euro-periphery is not yet out of the woods – Bruegel
While the public debt ratio is expected to fall, the debt
trajectory remains highly vulnerable to negative growth, primary balance and
interest rate shocks.
Euro Area: 2014 Article IV Consultation – IMF
Here’s How Much Upside Is Left in European Equities
– WSJ
With euro-zone sovereign debt yields becoming ever more
compressed, perhaps it should come as no surprise that investors are chasing
European equities.
Periphery Business Cycle Monitor – Danske
Bank
Spain,
Ireland, Portugal
and Greece have
potential for more surprises as the hard negative shock has resulted in very
high pent-up demand. We expect private consumption to improve further as
indicated by the increases in consumer confidence.
EUROPEAN CENTRAL BANK
TLTRO impact
questioned as the carry trade provides easy money – Sober
Look
The ECB’s Bank
Review: Kill the Zombies and Heal the Wounded – PIIE
Euro area deflation
monitor – Danske
Bank
UNITED STATES
OECD Urges Broad Tax
Reform In U.S. – WSJ
The U.S.
should reform its tax code with “a degree of urgency” to overcome challenges to
long-term economic growth, including an aging population and rising household
inequality, OECD said.
2014 Article IV
Consultation with the United States of America Concluding Statement of the IMF Mission
– IMF
IMF Slashes US Growth
Expectations; Pushes Higher Minimum Wage, Removing Tax Loopholes & Fiscal
Stimulus – ZH
OTHER
The macroeconomic
effects of asset purchases – voxeu.org
After reducing their policy rates close to zero in response
to the global financial crisis, the Bank of England and the Federal Reserve began
purchasing assets. This column assesses the effect of these asset purchases on
output and inflation. In line with previous studies, the authors find that
asset purchase announcements are associated with increases in both output and
inflation in both countries. They also find that quantitative easing had a
larger impact on UK
inflation, which suggests that the UK Phillips curve is steeper.
The US and the Eurozone 2012-3 – mainly
macro
If fiscal policy is important at the zero lower bound, why
did the US
recovery continue in 2012 and 2013 despite a large fiscal contraction? Or to
put the same question in a comparative way, why was the Eurozone’s fiscal
contraction in 2012/3 associated with a recession, but not in the case of the US?
The Case for a
Long-Run Inflation Target of Four Percent – IMF
Many central banks target an inflation rate near two
percent. This essay argues that policymakers would do better to target four
percent inflation. A four percent target would ease the constraints on monetary
policy arising from the zero bound on interest rates, with the result that
economic downturns would be less severe. This benefit would come at minimal
cost, because four percent inflation does not harm an economy significantly.
Paul Krugman: Does He
Pass the Test? – The
New York Review of Books
Review of Timothy F. Geithner’s Stress Test: Reflections on
Financial Crises
FINNISH
Näin on aina oleva – Juhani
Huopainen / US
Suomen kustannustason karkaaminen ja taloudellinen
menestys – Tyhmyri
Suhdannekatsaus 1/2014 – Valtiovarainministeriö
Kuluvana vuonna
talous kasvaa vain 0,2 % ja vuonna 2015 päästään maltilliseen 1,4 prosentin
kasvuun. Ennustejakson viimeisenä vuotena 2016 BKT:n kasvuksi muodostuu 1,6 %.
Vuonna 2015 kaikki kysyntäerät julkisia investointeja lukuun ottamatta
vaikuttavat talouskasvuun positiivisesti. Vienti lisääntyy 4,6 % kansainvälisen
kaupan piristyessä. Kotitalouksien reaalitulojen kehitys jää kuitenkin heikoksi
ja yksityisen kulutuksen kasvu jatkuu edelleen hyvin vaimeana.