Marc Auboin, 28 January 2009

Some 80% to 90% of world trade relies on trade finance, and there is little doubt that the trade finance market will experience difficult times in the first half of 2009 – difficulties that will contribute the global economic malaise. Public-backed institutions are responding, but are they doing enough?

Martin Feldstein, 26 January 2009

This column presents Marty Feldstein’s views on the euro. He suggests that tough economic conditions in Europe may cause substantial economic policy disagreements among the Eurozone countries and that one or more countries might actually withdraw from the Eurozone.

Barry Eichengreen, 20 January 2009

2008 was the year of asymmetric financial shocks for the Eurozone, but 2009 will be the year of the symmetric economic shock. All of Europe is slipping simultaneously towards recession and the threat of deflation. Here one of the world’s leading international economists explains that a common monetary policy response is optimal. Euro interest rates should be cut to zero and quantitative easing undertaken, all complemented by fiscal expansion by Eurozone nations that can afford it. What started as the euro’s greatest challenge could be its salvation, but only if policy makers act swiftly.

Nicholas Bloom, Max Floetotto, 12 January 2009

A key source of the today’s economic weakness is uncertainty that led firms to postpone investment and hiring decisions. This column, by the authors whose model forecast the recession as far back as June 2008, report that the key measures of uncertainty have dropped so rapidly that they believe growth will resume by mid-2009. This means any additional economic stimulus has to be enacted quickly. Delaying to the summer may mean the economic medicine is administered just as the patient is leave the hospital.

Richard Baldwin, 01 January 2009

No one knows exactly how to stop the global economic crisis, but all agree that fiscal stimulus has a key role to play. By reducing the length and depth of the recession, it should reduce bankruptcies, foreclosures, and further asset-price drops. This column presents the main logic in a recent IMF paper authored by one of the world’s leading macroeconomists, Oliver Blanchard, and others.

Richard Baldwin, Simon Evenett, 13 December 2008

Announcement that the WTO talks will not be put back on track this year – despite the G20’s November 15th commitment to do so – is the first concrete demonstration of the G20’s ineffectiveness. This column argues that the G20 should undertake a “Plan B” on world trade to restore G20 creditability and shore-up support for the WTO.

John Muellbauer, 27 November 2008

This column explains the logic behind a radically new form of monetary policy – a new central-bank tool for stabilising the credit cycle. By buying bank stocks and credit instruments at the bottom of the cycle and selling at the top, the new policy could moderate the boom-and-bust credit cycle independently of interest rate policy. The Fed action on 25 November is a good step in this direction.

Alberto Giovannini, 22 November 2008

Simplicity and transparency, two major causalities of recent financial market changes, are essential to restoring trust in financial markets. This column suggests that distinguishing two types of financial intermediaries – client servicers and capital managers – would be a big step in the right direction. Today’s lack of distinction means one set of regulations is applied to the two very different functions.

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