European growth : what's to be done

By: Jean Pisani Ferry, Bruegel

Some proposals on how to kick-start the economy.

House prices have 30-40% more to fall

By: Wolfgang Münchau

Here is an interview with me on CNBC on the housing market situation in western Europe and the US.

And now a currency crisis

Euro rises to an all-time high on a trade-weighted basis, as sterling-euro is fasting approaching parity; UK central bank says it, too, might to go ZIRP, and adopt quantitative easing; Germany’s Ifo index falls to the lowest level since 1982; ECB widens its interest rate margins to stops banks from hoarding cash; Belgium, meanwhile, has another government crisis, this time about undue government meddling with the judicial system in the case of the proposed sale of Fortis to BNP.

EMU and inequality: The facts

By: Giuseppe Bertola, University of Turin

Empirical research shows that EMU improves economic performance, but is also associated with higher inequality and lower social spending. This casts doubt on the political sustainability of EMU without social-policy integration and much deeper financial market development. Thinking about EMU’s future, it would be wrong and dangerous to disregard the implications for income inequality and its remedies.

How to make the euro more sustainable

By: Mike Wickens, University of York

The euro area faces two problems, one for the long term and one for the short term. The long-term problem is that, sooner or later, the divergence of price and output levels will threaten the sustainability of the euro. The short-term problem is that, having given up two of their three macroeconomic policy instruments, countries have only their social instrument left to stabilise their economies. This suggests that the euro area countries require greater social policy flexibility and not less.

Is Sarkozy winning?

By: Wolfgang Münchau

Germany should come up with its own plans for policy coordination. Otherwise, Sarkozy is going to win this debate.

Mr Sarkozy and the euro

By: Jean Pisani-Ferry, Bruegel

By attending the eurogroup meeting this week, Nicolas Sarkozy was above all making a political statement. After a decade of conspicuous absence by the heads of state and government at these meetings, Nicolas Sarkozy clearly intended to start a new chapter. But he lacks credibility. France cannot at the same time plead for a strengthening of the euro area governance and ignore the agreements that have already been reached.