Articles on Eurozone

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The ECB’s decision to consider purchasing government bonds led to relief in many troubled Eurozone economies. AAP

Good news from the Eurozone … or is it?

Finally good news from the Eurozone! According to recent Eurostat estimates the combined economy of this troubled region grew by 0.3% in the second quarter of 2013 after shrinking for six subsequent quarters…
Greece: not just riots and unemployment. flikr/Imagaday

Europe’s latest investment opportunity … Greece

The IMF has conceded that mistakes were made in the way the first Greek bailout in May 2010 was handled. Its report suggests the need to refine the fund’s lending policies to accommodate for conditions…
Cyprus is scrambling to find alternatives to avoid bankruptcy. EPA/Filip Singer

Cyprus: moving from the Eurozone to a Russian sphere of influence

The desperation the Cypriot government finds itself in cannot be exaggerated. In the scheme of things, it seems small, but the nature of each Eurozone crisis is that the small problems are often the largest…
The Euro crisis has finally arrived at the economic heartland of Germany; but the road to recovery may be the same for the Eurozone core powers as the peripheral economies. AAP

The Euro crisis has arrived in Germany: but is a recession scenario plausible?

Last week the German government’s economic forecasts for 2013 have made clear that the Euro crisis will have a serious economic impact on Germany, with the economic growth projection cut down to a mere…
Re-run: if the US fiscal cliff has the same feel as last year’s debt ceiling crisis, we’re not surprised…

2012, the year that was: Business and Economy

Different year, same crisis. Around this time last year, the United States was looking down the barrel of economic disaster with the debt ceiling. As we approach 2013, it peers over the fiscal cliff. That…
With the implementation of the Single Supervisory Mechanism, European Central Bank chief Mario Draghi has taken a major step towards greater financial integration in the Eurozone. AAP

EU banking union is a decisive step towards saving the euro

Last week was one of mixed fortunes for the Eurozone. The week began badly with news that Italy’s Prime Minister Mario Monti was resigning due to Silvio Berlusconi’s withdrawal of parliamentary support…
The US Federal Reserve has extended its bond-buying program, but will it be effective in boosting the economy? Image from www.shutterstock.com

More money, more problems? The quantitative easing quandary

In an attempt to bolster the economy, the Federal Reserve announced a fresh round of bond purchases to replace Operation Twist, the stimulus program that is set to expire this month. It will spend $US45…
Tackling France’s mounting sovereign debt will prove challenging for French President François Hollande. AAP

There are no easy solutions for France’s economic woes

Pressure is mounting for the recently elected French Socialist president, François Hollande and his government to address France’s sovereign debt, which is currently at a post-war record of 91%. France…
European Central Bank President Mario Draghi announced that the ECB will buy back bonds on the secondary market in a bid to curb the debt crisis. AAP

Bonds to the rescue: ECB reveals its Eurozone rescue plan, but will it be enough?

Yesterday, the European Central Bank’s president, Mario Draghi, unveiled the European Central Bank’s rescue plan for the Eurozone. Mr Draghi said that the ECB is now prepared to buy sovereign bonds of…
Fair contest: should we tinker with the rules in a free market? AAP

The AFL’s lesson for the global economy: changing the rules works

We all know the global economy is down the toilet. Even if we overlook the financial debacle in Greece, Spain, Iceland, Ireland – and that’s not easy – the big problem is Uncle Sam. Currently, the US Government…
Show of unity: Spain’s King Juan Carlos (centre) supported austerity cuts by Prime Minister Mariano Rajoy - but expressed concern about their impact on Spanish youth. AAP

Spain faces brain drain as its youth looks for a future abroad

Half of Spain’s youth (that is, those under the age of 25) are now officially unemployed, while overall unemployment in Spain stands at 24.4%, according to the latest figures released by the Spanish Institute…
In the aftermath of the Greek elections, there have been renewed calls to accompany austerity measures with pro-growth policies.

Austerity and growth: trying to make sense of a contradiction

Having read that the outcome of the Greek elections points to a continuation of the push for fiscal austerity in that country, my heart sunk. Then I see that our own Prime Minister has been quoted as telling…
Greece’s citizens are faced with an unenviable choice. EPA/Orestis Panagiotou

Greece’s choice: bargaining versus pleading

When two sides bargain, their interaction reflects a potential mutual benefit but also a measure of conflict. For instance, when a firm and its supplier reach a deal, there is often more than one price…
Alexis Tsipras, leader of the Coalition of the Radical Left (Syriza) party, has proposed the cancellation of Greece’s agreements with the European Union and the IMF. AAP

With Europe at debt’s door, the future hinges on Greece’s election result

All eyes are on Greece this weekend for the second legislative election in five weeks. This is no ordinary election: the global implications of the outcome might be significant. Griffith University lecturer…
Alexis Tsipras will lead Syriza to the polls on June 17. EPA/Orestis Panagiotou

Greek elections: the heart of contradiction

To free the age from its captivity, To create a brand new world, The discordant, tangled days Must be linked, as with a flute. –Osip Mandelstam, The Age (1923) There is an air of impending disaster in…
If Australia had been founded according to the Eurozone model, our current economic situation would look very different. adam79

Australia and the Eurozone: a counterfactual account of economic history

Suppose that in 1901 Australia’s founding fathers had designed the Commonwealth differently. The states were to retain all powers to tax and had to finance themselves (including health, education and social…
Spanish Prime Minister Mariano Rajoy: banks are bailed, but just a brief respite? AAP

Spanish bailout buys time for eurozone ‑ but only a little

The positivity off the weekend’s news that Spain’s banks will receive rescue loans of up to 100 billion euros from eurozone finance ministers appears short-lived. Despite it being well-received in Asian…
Following the EU summit in Brussels this week, it seems eurobonds are back on the agenda. But will it be what it needed to save the Eurozone? AAP

Will (Euro)bonding help solve the euro crisis?

The special EU summit held in Brussels on Wednesday revamped the discussion on Eurobonds (i.e. the issuance of common government bonds to pool the Eurozone debt liability) as a possible option to address…
Austerity’s political cheer squad: but is the game over? G8 countries have committed to growth by setting sights on employment.

Why do our world leaders cling to the dismal politics of economic austerity?

The lingering commitment to austerity of leading Western politicians in the face of impending economic tragedy is beyond belief. The dismal science is a sobriquet often wrongly applied to economics, but…
During the Great Depression, policymakers had an irrational - and detrimental - attachment to the gold standard. Should we be worried about the similar fervour for a strong euro? BullionVault

When it comes to solving the euro’s woes, it’s the same gold story

Are the tragedies of the 1920s repeating themselves in the twenty-first century? In the 1920s, an irrational attachment to the gold standard helped cause the Great Depression, as European fears of inflation…

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