Ari Aisen, Dalibor Eterovic, 26 February 2010

What will happen to the global imbalances that many argue caused the global financial crisis? This column suggests that, while both surplus and deficits countries may make adjustments, emerging markets that have so far been on the sidelines of the action and outside the core discussion of global imbalances could start to absorb the excess liquidity.

Zsolt Darvas, 23 February 2010

The EU has used various means to support the crisis-hit countries of Central and Eastern Europe. This column argues that EU action has been an expression of solidarity in recognition of the EU's responsibility to the region. But EU institutions and governments have also contributed to the suffering of Central and Eastern European in the crisis by some actions – or through failures to act.

Simon Johnson, Peter Boone, 22 February 2010

Over the last 30 years, the US financial system has grown to proportions threatening the global economic order. This column suggests a ‘doomsday cycle’ has infiltrated the economic system and could lead to disaster after the next financial crisis. It says the best route to creating a safer system is to have very large and robust capital requirements, which are legislated and difficult to circumvent or revise.

Panicos Demetriades, Svetlana Andrianova, Anja Shortland, 20 January 2010

The nationalisation of banks as a result of the global economic crisis has been a source of controversy. This column argues that governments should not feel pressured to re-privatise the banks. Once the black sheep of high finance, government owned banks can reassure depositors about the safety of their savings and can help maintain a focus on productive investment in a world in which effective financial regulation remains more of an aspiration than a reality.

Chad Bown, 18 February 2010

Protectionism has been a growing concern during the global crisis. This column examines the fourth-quarter data from the Global Antidumping Database. For the first time since the onset of the crisis, the world witnessed a substantial decrease in industry demands for temporary new import barriers through trade remedies. But this period also saw a substantial increase in new trade barriers imposed, as the trade-remedy investigations initiated earlier in the crisis concluded with new protection.

Ashoka Mody, Franziska Ohnsorge, 17 February 2010

Just how important is consumption for growth? This column suggests that consumption trends in the G7 economies have significant short-term and long-term implications for global growth and global imbalances. For sustained rebalancing of the global economy, however, investment behaviour may be more important.

Kalina Manova, Davin Chor, 15 February 2010

Was the great trade collapse due to the evaporation of credit? This column examines how the interbank lending rate across countries affected US trade during the crisis months to confirm the role of credit conditions in influencing trade patterns. It suggests the decline in trade volumes would have been about twice as large had interbank rates remained at the high levels of September 2008.

Thorvaldur Gylfason, 13 February 2010

How to stop a repeat of Iceland’s crisis – both in the country and elsewhere? This column provides eleven lessons covering asymmetric information, moral hazard, better warning systems and improved regulation, preventing banks becoming “too big to fail” and restricting asset bubbles, holding creators of externalities to account, and providing safeguards on political interference.

Anne Sibert, 13 February 2010

Who should pay for the money lost by UK and Dutch citizens investing in Icesave accounts? This column presents the dispute's background and argues that the debt burden of Icesave is likely to be closer to 15% of GDP than the 50% often reported. It concludes that Iceland is not too small to repay.

Thorvaldur Gylfason, Bengt Holmström, Sixten Korkman, Vesa Vihriälä, Hans Söderström, 10 February 2010

Is the Nordic model an asset or a liability? The global crisis has seen GDP in the region decline by between 4.5% and 7%. This column argues that the Nordic model, with its welfare state and high rate of investment in human capital, can, properly implemented, be part of the solution.

Tigran Poghosyan, Martin Cihák, 08 February 2010

How safe are the banks? This column provides new evidence on what determines the likelihood of an EU bank experiencing distress, suggesting that bank risks have converged across EU members, and that a more tightly integrated financial regulation should reflect this. The results also call for a greater role for market discipline.

Marco Pagano, Alessandro Beber, 06 February 2010

Did the bans on short selling achieve their stated purpose of restoring order to the stock market and limiting unwarranted drops in prices? This column presents new evidence from 30 countries arguing that the effect on stock prices was at best neutral, the impact on market liquidity was clearly detrimental – especially for small-cap and high-risk stocks, and that the ban slowed down price discovery.

Giancarlo Corsetti, André Meier, Gernot Müller, 05 February 2010

The staggering growth in public debt as a result of the financial crisis has led many to call for significant fiscal retrenchment. This column argues that such looming expenditure cuts will actually enhance the effectiveness of today’s fiscal stimulus. But if monetary policy is constrained by the zero lower bound on policy rates, the spending cuts should not come too early.

Jonathan Heathcote, Gianluca Violante, Fabrizio Perri, 02 February 2010

The unemployment rate has dominated economic headlines, but recessions raise numerous problems. This column warns that recessions raise earnings inequality and income inequality, absent mitigating government programmes. The current recession has indeed raised such inequality, but consumption inequality has surprisingly declined.

Alberto Giovannini, 30 January 2010

Alberto Giovannini highlights some fundamental characteristics of the recent financial crisis and identifies ways to make the financial system stronger.

Alberto Giovannini, 30 January 2010

The debate over reform of the financial system has intensified even as the crisis has started to recede. This Policy Insight argues that too much investment activity has been able to operate without detection by regulators. To prevent a repeat crisis, regulators must have an informational advantage over market participants to assess the weaknesses in the financial system as they develop.

Johannes Stroebel, John Taylor, 27 January 2010

Should the Fed scale back its ownership of mortgage-backed securities? This column analyses the effect of the programme on mortgage interest rates. Controlling for prepayment and default risk suggests the programme has had little or no impact, and that the Fed could gradually cut the size of its portfolio without a significant impact on the mortgage market.

Deniz Igan, Prachi Mishra, Thierry Tressel, 27 January 2010

Should the political influence of large financial institutions take some blame for the financial crisis? This column presents evidence that financial institutions lobbying on mortgage lending and securitisation issues were adopting riskier lending strategies. This contributed to the deterioration in credit quality and to the build-up of risks prior to the crisis.

Jon Danielsson, 26 January 2010

This new CEPR Policy Insight looks at the issues arising from the collapse of Landsbanki.

Jon Danielsson, 26 January 2010

Icelanders may well reject the terms of the financial deal with Britain and the Dutch in a March referendum. This column introduces a new CEPR Policy Insight arguing that responsibility for Icesave losses falls jointly on Iceland, Britain and the Netherlands. Regardless of the vote, the three governments should come to a more reasonable agreement that enables Iceland to pay its obligations without tipping the economy into the abyss.

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