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In RealTime posts, PIIE senior staff and colleagues discuss the fast-moving economic news, financial developments, and public policy choices confronting the United States and the world.
In the wake of the death of Kim Jong-il, there were questions as to whether anyone was in charge in Pyongyang. Now we know that someone is capable of making decisions and their first one constitutes a conciliatory (indeed, concessionary), not belligerent, gesture. The agreement does not completely freeze the North Korean nuclear program but [...]
Reauthorization of the Export-Import Bank is stalled in Congress because of opposition from odd bedfellows. The issue has been addressed previously in this forum, but in this posting a solution to the impasse is offered that could clear the way for funding a vital federal program. Before we get to that drama, it’s worth considering [...]
The sad fact is that no one outside officialdom (who are duty-bound to talk nonsense when sense is too embarrassing) seems to regard the recent privately held debt write-down and second Greek bailout as likely to offer an exit to Greece from its nightmare, even in the long run. The reason is simple: Greek competitiveness [...]
More than a year ago, I argued that China’s GDP in purchasing power parity (PPP) dollars had overtaken that of the United States in 2010. This calculation is used in my book, Eclipse: Living in the Shadow of China’s Economic Dominance and plays a role in my conclusion that China has overtaken or is close [...]
Two years after the acute financial crisis erupted in Greece, the Eurogroup, the European Central Bank (ECB), and the International Monetary Fund (IMF) are still trying to get a handle on the problem. Their latest failure occurred after another all-night mangling on February 21. In fact, what they achieved was a Greek default, although it [...]
Just as it did when Congress recently extended the payroll tax cut, brinkmanship has produced an early morning deal in Europe to extend a new lifeline to Greece and clear the way for the biggest sovereign bond restructuring in history. Both pieces of the agreement—the privately held Greek debt write-down of more than €100 billion [...]
For more than two years, European leaders have dithered. They have failed to address decisively the escalating euro-area sovereign debt crises. In the process, the European economy has been damaged and the future of the entire European integration project, which began more than 60 years ago, has been called into question. Moreover, the failure of [...]
Setting aside Syria, South Korea may be the only country in the world with politics more polarized than the United States. While in Seoul last week I was reminded of this when the leaders of the political opposition attempted to march on the US embassy to deliver letters addressed to President Obama and Vice President [...]
Washington and Brussels are trying to curb Iranian oil revenue in a bid to convince Tehran to abandon its nuclear weapons program. But it appears financial sanctions imposed by the West are having a more immediate impact on what Iran buys from abroad rather than what it sells. Reports this week suggest Iranian companies are [...]
The improvement of euro area market conditions in January can be attributed to several factors, including the progress made by Prime Minister Mario Monti in Italy, and some constructive if Delphic signals coming from Berlin. It also suggests that a lot of bad news was already priced in during December, including a “credit event” on [...]