The Greek crisis and the future of the Eurozone

By: Paul De Grauwe

Sorting out the Greek crisis remains the absolute priority in the short-term.

Greek Competitiveness Is Not the Issue, Fiscal Discipline Is

By: Erik Jones

The simple fact of the matter is that Greece is having a fiscal crisis. It would have had that crisis whether or not it was in the eurozone.

Europe in Dire Straits – don’t be Brothers in Arms.

By: Henrik Enderlein

The case against bailing out Greece.

How should the Eurozone handle Greece?

The political pros and cons for no support, a European rescue and a call for the IMF.

The Euro Area's political constraints

By: Wolfgang Münchau

Not all policy solutions are possible in a monetary union. There are severely constitutional constraints.

When Does It Hurt?

By: Ansgar Belke

The exchange rate “pain threshold” for German exports is at $1.55 to the euro.

Fiscal policy in Central and Eastern Europe

By: John Lewis

Countercyclical but deteriorating with EU membership.

The problems with the Schäuble proposal

By: Wolfgang Münchau

The real bullet is not the EMF, but the exit clause, which could become a self-fulfilling prophecy.

Eurozone Meltdown

This is the first in a new series of regular briefing notes on important issues facing the euro area. In this briefing note we are asking whether the euro area could ever break up. We think not. But we are not as certain as we used to be.

The deal is done – or is it?

Finance ministers announce that they have agreed on a package for Greece - except that all the details have yet to be worked out; what seems to have been agreed that any aid, should it be necessary, would come in the form of loans, not loan guarantees; ministers pretend that aid will probably not be needed; rating agency S&P expresses concern about the impact of the recession on Spanish banks; German official react furiously at Christine Lagarde’s criticism of Germany’s current current account surplus; Daniel Gros says Greece faces the choice between a long recession or a one-big large internal devalution; Lorenzo Bini-Smaghi comes out in favour of explicit bailout rules.

The Greek crisis and the future of the Eurozone

By: Paul De Grauwe

The crisis that started in Greece culminated into a crisis of the Eurozone as a whole. There is no doubt that the major responsibility rests with the Greek authorities who mismanaged their economy and deceived everybody about the true nature of their budgetary problems. The solution of the problem will therefore necessitate drastic changes in Greek economic and budgetary policies. This being said, there is more than one villain in the play. The financial markets and the eurozone authorities also bear part of the responsibility for letting this crisis degenerate into a systemic crisis of the eurozone.

Why the Euro will continue to weaken

By: Wolfgang Münchau

When you consolidate the fiscal position, either the private sector deteriorates, or the current account has to improve. This would either imply, or necessitate, a depreciation.

Greek Competitiveness Is Not the Issue, Fiscal Discipline Is

By: Erik Jones

The simple fact of the matter is that Greece is having a fiscal crisis. It would have had that crisis whether or not it was in the eurozone.

Greek Competitiveness Is Not the Issue, Fiscal Discipline Is

By: Erik Jones

With all due respect to my colleagues in the economics profession, they have jumped the gun on Greek competitiveness within the eurozone. The simple fact of the matter is that Greece is having a fiscal crisis. It would have had that crisis whether or not it was in the eurozone. Greece is not having a crisis of competitiveness. Hence joining the eurozone was not the problem; leaving it is not the solution.