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A website forum in which senior fellows of the Peterson Institute for International Economics discuss and debate their responses to global economic and financial developments as they occur each day and offer insights that others might overlook.
Whether to use public money to rescue financial firms because they are too big, too complex, or too interconnected to be allowed to fail is not a new issue. However, in the financial and economic crisis of the last year and a half, the number and nature of such rescues in [...]
President Obama’s trip to East Asia over the next two weeks comes at an important time in Asian regionalism. East Asian governments have been moving on several fronts toward regional cooperation and, while some skepticism might be justified, the rest of the world would be wrong to dismiss these developments as [...]
The need for a new equilibrium in global current account and trade imbalances has compelled American policymakers to urge Germany to change its model from that of an export-led economy to one based more on domestic consumption. This would be in keeping with the message delivered in July at the Peterson [...]
A common American assumption has been that the US economy would recover earlier and faster than that of the European Union. Therefore, the preliminary results for the second quarter of 2009, which showed that Germany and France grew by 0.3 percent over the first quarter of 2009, delivered a surprise. Well, this should not have [...]
Ben Bernanke will be nominated for a second term as chairman of the Federal Reserve. But which Bernanke are we getting? There are at least three.
The Bernanke who led the charge to rescue the US (and world’s) financial system after the Lehman-AIG collapse. [...]
US President Barack Obama and Russian President Dmitri Medvedev achieved the maximum of what had seemed possible when they met in Moscow on July 6. With satisfaction and some justification, President Obama could conclude: “We resolved to reset US-Russian relations…”
As expected, the emphasis lay on military matters. The critical success [...]
The shift in employment in the United States toward the service sector has long been associated with rising income levels. Generally speaking, the larger a country’s services sector as a share of the economy and employment, the richer the country. What, then, is the outlook now that the global [...]
The Department of Justice seems to thinking, at least in principle, about potential antitrust action in and around banking. Assistant Attorney General Christine Varney spoke about this on April 11, but her wording is open to interpretation, “I have to ask if too big to fail is a failure [...]
In most advanced industrial countries, the value of public pension benefits is protected by annual cost-of-living adjustments, also known as COLAs. Every year, the value of pension benefits is adjusted upward, in line with inflation, wages, or a combination of the two.1 The adjustments are meant to protect the purchasing power [...]
The public relations campaign packaging the bank stress tests is kicking into high gear and our professional information managers are really hitting their stride. They face, of course, a classic spin problem: You need to get the information out there, but you don’t want to be too definitive on the first day [...]