Monthly Archives: August 2011

By Thomas I. Palley

The eurozone‘s public finance crisis continues to fester, reflecting both political and intellectual failure. The intellectual failure is that the crisis has been interpreted exclusively as a debt crisis when it is also a central bank design crisis resulting from the euro’s flawed architecture. The flaw is the inability of eurozone governments to harness the central bank’s power to assist government finances. This systemic weakness explains why US and UK government bonds are weathering the storm, whereas Spain confronts default rumours despite having roughly similar debt and deficit profiles. Read more

The gloss is coming off the India story. Recent weeks have seen downgraded growth forecasts, rising inflationary pressure, poor job creation numbers, a faltering stock market and an erratic trajectory in inbound foreign investment.  Read more