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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 recent months, it has looked as if all the major nominally independent central banks in advanced economies are committed to, or seriously contemplating, intervention in the markets to lower the value of their currencies. Excluding commodity exporters like Canada, Australia, and Norway, everyone is on board—except the European Central Bank (ECB). Since September 2011, [...]
Pity David Cameron. What is a British Prime Minster to do? The UK economy is stagnating even before the spending cuts in his fiscal consolidation program begin to bite. His central bank seems reluctant to provide more monetary stimulus—though that might change with his new handpicked Bank of England governor. Like GOP House Speaker John [...]
As a result of revolutionary gas extraction techniques (hydraulic fracturing combined with horizontal drilling), the United States suddenly enjoys a dramatic reversal of fortune in energy production and trade. The Department of Energy (DOE) is now processing several applications for liquefied natural gas (LNG) exports, as producers are eager to take advantage of large price [...]
More than a month after North Korea fired a missile in contravention of two existing UN Security Council (UNSC) resolutions, the Security Council passed UNSC Resolution 2087, condemning the use of ballistic missile technology in launch and saying the “act violated United Nations sanctions, expresses determination to take ‘significant action’ in event country proceeds with [...]
Everywhere you look, the survival of the euro seems to be an idea whose time has come. In France, a limited measure of progress occurred when the country’s social partners agreed to some labor market reforms. Chancellor Angela Merkel’s party lost a German regional election, with no dire consequences for its commitment to save the [...]
On January 19, the Wall Street Journal published a letter that was a condensed version of my response to an article by Edward Lazear on January 8. My complete response follows. Edward Lazear argues that China’s massive government intervention in the currency markets—more than $3 trillion in the past 10 years—has caused no significant harm [...]
Cyprus is small even by peripheral euro area standards. With a GDP in 2012 of less than €18 billion, the country is only about one-tenth the size of Ireland, Portugal, or Greece. In the context of the euro area’s new €500 billion European Stability Mechanism, its financial problems look like a rounding error. Yet as [...]
In the Financial Times today (January 14), I argue that multilateral trade as we know it could soon become history. In the past, we have seen regional trade agreements between large and small countries. Now for the first time, we are seeing the prospects of regional trade agreements between the major trading nations: the United [...]
Last November, the British Labor leader, Ed Milliband, claimed that Britain is “sleepwalking” out of the European Union. Unfortunately, his assessment appears accurate. As discussed in my letter to the Financial Times today, the current British Conservative-Liberal government under Prime Minister David Cameron seems to have no higher aim with regard to Europe than to [...]
A recent report from the think tank Global Financial Integrity (GFI) identifies China as the largest source of illicit financial flows in the developing world. The report, Illicit Financial Flows from China and the Role of Trade Misinvoicing, identifies $3.75 trillion in illicit outflows during between 2000 and 2011. The possibility of trillions of dollars [...]