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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.
The recent drama over whether the United States would default has weakened confidence in the American economy and underscored the already growing desire of many investors around the world, including many central bankers, for more diversity in their portfolios. Indeed, even policymakers in the United States might agree that the US dollar is vastly over-weighted, [...]
The dominant short-term economic problem today is the contrast between the prosperity of most emerging markets/developing countries and the excess capacity in most of the advanced economies (the principal exceptions being Australia and Sweden). No one begrudges the success of the poorer countries in starting to catch up, but they gain nothing (and lose a [...]
Meeting in St. Andrews a year ago, at the depths of the global economic downturn, the G-20 finance ministers and central bank governors initiated a “mutual assessment process” (MAP) to evaluate their objectives and the global consistency of their policies. In the Gyeongju meeting of October 23, the G-20 participants took another major step by [...]
The G-20 Finance Ministers and Central Bank Governors, who met in Seoul over the weekend of October 23–24, made only minor progress on currency and balanced growth issues—certainly not enough progress to decrease materially the threat of continued currency wars. Yes, they said all the right things about moving toward “more market determined exchange rate [...]
Before the global economic and financial crisis began in August 2007, the enormous current account deficits and surpluses of some major countries and groups of countries (the United States, China, and oil producers, for example) were widely identified as posing the greatest risk to international economic and financial stability. As the crisis winds down, attention [...]
The agreement to coordinate global economic strategies was one of the most impressive achievements by the G-20 in Pittsburgh and at the IMF meeting in Istanbul. But without credible agreements on currency policies, that project could turn out to be very vulnerable, or even a Trojan horse allowing politically stronger countries (China and the United [...]
On Monday and Tuesday of this week, Treasury Secretary Geithner—and Secretary of State Clinton—meet with a high-level Chinese delegation. According to official previews (i.e., the apparent contents of background briefings given to wire services), the economic topics are China’s concerns about the value of the dollar (i.e., their investments in the U.S.) and the amount [...]