201 Results for:

October 3, 2019

Eurozone
The Role of the European Central Bank

As Europe has weathered a succession of economic crises, the European Central Bank has responded with an aggressive set of monetary policies that have redefined the bank’s original mandate.

Workers repair the euro sign in front of ECB headquarters

March 12, 2015

Brazil
Why Is Walmart Raising Wages?

On February 19, Walmart announced that it was raising its minimum starting wage to $9 an hour.  Since Walmart is famous for its ruthless cost management, this appeared to be a significant sign of …

Why Is Walmart Raising Wages?

March 4, 2015

United States
Psychology and the Oil Market

In his recent book, Market Madness: A Century of Oil Panics, Crises, and Crashes, our colleague Blake Clayton explains the role of market psychology in contributing to the wild price swings that h…

Psychology and the Oil Market

July 2, 2015

Europe and Eurasia
Greece Fallout: Italy and Spain Have Funded a Massive Backdoor Bailout of French Banks

In March 2010, two months before the announcement of the first Greek bailout, European banks had €134 billion worth of claims on Greece.  French banks, as shown in the right-hand figure above, had…

Greece Fallout: Italy and Spain Have Funded a Massive Backdoor Bailout of French Banks

June 24, 2015

Europe and Eurasia
A Full Greek IMF-Debt Default Would Be Four Times All Previous Defaults Combined

Since the IMF’s launch in 1946, 27 countries have had overdue financial obligations of 6 months or more.*  But the amounts involved have always been small, never exceeding SDR 1bn ($1.4bn). This …

A Full Greek IMF-Debt Default Would Be Four Times All Previous Defaults Combined

June 5, 2015

Europe and Eurasia
Greece-Troika Gap Over Primary Surpluses Has Shrunk Dramatically

Greece has announced that it will not pay the IMF the €300 million due to the Fund on June 5.  Instead, it will “bundle” the payments due to the Fund over the course of June into one payment of ab…

Greece-Troika Gap Over Primary Surpluses Has Shrunk Dramatically

April 2, 2015

Monetary Policy
Is the Fed Gonna Tighten Like It’s 1994? Or 2004?

How will the Fed raise rates once it starts?  Gradually, in small steps?  Faster, with larger steps? In 2012, before becoming Fed chair, Janet Yellen argued for a later first rate-hike than would…

Is the Fed Gonna Tighten Like It’s 1994? Or 2004?

February 2, 2015

Monetary Policy
Employment Data Suggest Fed Could Be "Patient" Until 2016—or Later

In its last two statements, the FOMC has said that it “expects inflation to rise gradually toward 2 percent over the medium term”—2 percent being its target rate. What would it take to move it the…

Employment Data Suggest Fed Could Be "Patient" Until 2016—or Later

November 20, 2014

Europe and Eurasia
Bank Valuations Tank as ECB Flubs Its Stress Test

Low market valuations (i.e., price to book ratios) for euro area banks reflect market concerns over their capital cushions, opined the Bank of England just prior to last-year’s launch of the ECB s…

Bank Valuations Tank as ECB Flubs Its Stress Test

November 3, 2014

Europe and Eurasia
The ECB Fails to Stress Banks Over the One Critical Variable It Controls: Inflation

Relentlessly falling inflation is bad news for Eurozone banks.  It increases the real (inflation-adjusted) value of borrower debt and the real cost of servicing that debt.  It causes loan defaults…

The ECB Fails to Stress Banks Over the One Critical Variable It Controls: Inflation