The myth of contagion is catching
Talks of contagion risk, despite having a brief respite earlier this year, are back stronger than ever. With Italy dominating the news, the new…
How optimal is the eurozone: Part II
I recently wrote about the inconsistency of the economic arguments for the formation of the Eurozone. The conclusion that the euro was oversold at…
How optimal is the eurozone: Part I
European monetary integration relies on the theory of the optimal currency area (OCA). Successful currency unions generally meet four criteria: A high degree of…
China and Europe: 100 years of folly
One can read The Daily Mail for its coverage of the royal family, snapshots of British life, or, if you are like me, the…
Europe’s underground economies
One significant issue arising in the crisis has been the size of some European underground economies. Politicians seek measures to increase public revenues as…
The rules of sovereign debt
Bonds have three features that differentiate them from equity instruments. They involve fixed and contractually binding interest payments. They have a finite maturity. Finally,…
Greece: deflate or default
The original worry was whether Greece would default. Then it became a question whether it should it default. Now it is a question of…
Mervyn King’s “Operation Bernhard”
The UK is in sorry shape today. The British can at least take comfort in knowing that things are still not anywhere near as…
Who’s the Real Counterfeiter?
The Royal Mint is increasingly wary of criminal gangs copying their efforts. In a sampling of the currency in circulation across Britain in 2008,…
A New Year’s Resolution for the Bank of England
The One Hundred Twelfth United States Congress opened the year with a reading of the American Constitution. Though this was probably more of a…