A new Council on Foreign Relations (CFR) publication, "Global Economics Monthly," examines the major developments and trends affecting macroeconomic policy and financial markets. Written by Robert Kahn, CFR's Steven A. Tananbaum Senior Fellow for International Economics, the monthly report from the Maurice R. Greenberg Center for Geoeconomic Studies is accessible on CFR.org and distributed as an electronic newsletter.
The first report, issued in June, outlines Europe's debt and austerity dilemma. Countries that "need to ease fiscal policy cannot afford to take on more debt, while those that have the capacity to stimulate their economies do not want to," Kahn explains. "A future fiscal union in Europe would address this dilemma by allowing borrowing costs to be spread across all EU countries rather than fall on struggling peripheral economies," but "bailout fatigue" makes this outcome unlikely, he concludes.
This month, Kahn looks at lessons learned from the International Monetary Fund (IMF)'s involvement in Greece's 2010 economic crisis and other debt restructurings. "Recognizing that the recent debt restructuring was insufficient to restore Greece's creditworthiness," he writes, "the IMF will likely toughen conditions for lending to countries with unsustainable debt levels.
Kahn is an expert on macroeconomic policy, finance, and crisis resolution and has held senior positions in the public and private sectors, including at the World Bank, the IMF, the U.S. Treasury Department, and Citigroup.
Read the reports at: www.cfr.org/global_economics_monthly Subscribe to this and the CFR's fourteen other newsletters at: www.cfr.org/newsletters. Kahn also shares his insights on his blog, "Macro and Markets."