The Flaws of the Central Counter Party Idea

By: Satyajit Das

This paper takes a detailed and critical look at the CCP - the basic idea behind, its design, risks and effects on the market.

Muddling through is no option

By: Wolfgang Munchau

There are only two ways to resolve a debt crisis: through bail-out or through default.

A repository of solutions to global problems

For two years now, leading policy makers, academics and businessmen have been meeting for discussions in the Global Economic Symposium to provide concrete solutions for the most pressing global governance issues the world will be facing this century. Here is the result of these discussions: a repository of concrete policy proposals.

The crisis is back

Frenzy over increasingly likely Greek debt restructuring and outcome of Finnish elections sends eurozone bond spreads back up to crisis levels.

A short background note on the European politics behind the Portuguese rescue

There is a distinct possibility of a funding squeeze for Portugal, especially in case of inconclusive election outcome. The EU's crisis resolution is getting messier and messier.

A Tale of Two Trilemmas

By: Kevin O’Rourke

This article relates two famous trilemmas - the Mundell-Fleming monetary policy trilemma and Dani Rodrik's fundamental political trilemma - to the eurozone and its financial crisis.

Ireland’s debts to the eurosystem

By: John Whittaker

Ireland is paying 1% interest on €146bn of borrowing from the central banks of other eurozone countries. To the extent that it is persuaded to replace this eurosystem ‘bailout’ with more expensive EU/IMF bailout funds, this will only increase the financial distress and bring default closer.

Should we cheer the European Stability Mechanism?

By: Paul de Grauwe

We should be happy that a European Monetary Fund, the ESM, has been created. That’s the good news. The bad news is that the fine print of the operation of the future ESM is not likely to lead to stability in the Eurozone.

Euro breakup revisited

By: Wolfgang Münchau

German limited liability for the eurozone makes serial sovereign default increasingly likely. Even a break-up is no longer a zero probability event.

Decision Time

By: Marco Annunziata

It’s time for EU leaders to step up their game, to switch their sights from survival to success.

Sovereign CDS – The Case for Control

By: Satyajit Das

ISDA’s argument that a ban on naked sovereign CDS will adversely affect Europe’s financial stability is disingenuous. Speculative trading in sovereign CDS is likely to be more destabilising, allowing potential market manipulation.

The flawed economics of the Competitiveness Pact:

By: Daniel Gros

A restoration of competitiveness in Southern Europe needs ultimately a macroeconomic cure: a contraction in demand leading to adjustment in wages. As capital flows are now reversing the imbalances will anyway disappear on their own. This ‘market based’ adjustment pattern needs time, but it works.

The Eurozone’s new clothes

By: Thomas Klau

The current European effort to rescue the eurozone ignores three basic truths: it is a banking crisis first and formost; there is an intolerable overlap of co-ordination proposals; and rules and sanctions-based proposals are unworkable in a large monetary union.