May 16, 2011

Beware the impact of returning to normal

At the U.S. Federal Reserve’s recent and first-ever public press conference, Chairman Ben Bernanke gave a spirited defense of the Fed’s much-criticized policy of mass purchases of U.S. government bonds, or “quantitative easing.” But was his justification persuasive? Most economists viewed his performance as ...

Apr 6, 2011

A cure for fiscal failure

CAMBRIDGE, Mass. — Should more countries create independent fiscal advisory councils to infuse greater objectivity into national budget debates? Jailed swindler Bernie Madoff recently summed up a lot of people’s feelings about fiscal policy, declaring that “the whole government is a Ponzi scheme.” Perhaps ...

Mar 9, 2011

Reduce global imbalances with wholesome asset diet

CAMBRIDGE, Mass. — Doctors have long known that it is not just how much you eat, but what you eat, that contributes to or diminishes your health. Likewise, economists have long noted that for countries gorging on capital inflows, there is a big difference ...

Feb 10, 2011

The inequality wild card

DAVOS, Switzerland — As the dramatic events in North Africa continue to unfold, many observers outside the Arab world smugly tell themselves that it is all about corruption and political repression. But high unemployment, glaring inequality, and soaring prices for basic commodities are also ...

Jan 6, 2011

2011: Armageddon can wait

CAMBRIDGE, Mass. — Where are global currencies headed in 2011? After three years of huge, crisis-driven exchange-rate swings, it is useful to take stock both of currency values and of the exchange-rate system as a whole. And my best guess is that we will ...

Dec 8, 2010

Euro crisis reaches midlife

CAMBRIDGE, Mass. — Now that the European Union and the International Monetary Fund have committed 67.5 billion euro to rescue Ireland’s troubled banks, is the euro zone’s debt crisis finally nearing a conclusion? Unfortunately, no. In fact, we are probably only at the midpoint ...

Sep 4, 2010

It's no surprise that America isn't working

CAMBRIDGE, Mass. — As the U.S. economy limps toward the second anniversary of the Lehman Brothers bankruptcy, anemic growth has left unemployment near 10 percent, with little prospect of improvement soon. Little wonder that, with midterm congressional elections coming in November, Americans are angrily ...

Aug 12, 2010

Age of stunted expectations

CAMBRIDGE, Mass. — As the United States and European economies continue to struggle, there is rising concern that they face a Japanese-style “lost decade.” Unfortunately, far too much discussion has centered on what governments can do to stimulate demand through budget deficits and monetary ...

Jul 7, 2010

Can good come from BP's oil spill?

CAMBRIDGE, Mass. — Perhaps it is a pipe dream, but it is just possible that the ongoing BP oil-spill catastrophe in the Gulf of Mexico will finally catalyze support for an American environmental policy with teeth. Yes, the culprits should be punished, both to ...

Jun 5, 2010

BP disaster's lesson for government regulators

CAMBRIDGE, Mass. — As the damaged BP oil well continues to spew millions of gallons of crude from the depths of the floor of the Gulf of Mexico, the immediate challenge is how to mitigate an ever-magnifying environmental catastrophe. One can only hope that ...