Shadow ECB Council criticises neglect of deflation danger

The Shadow ECB Council held a conference-call on 27 March, 2014 to discuss whether and which monetary policy measure would be appropriate to deal with the continued inflation undershoot and to counter the threat of deflation.  There was broad consensus that the low and declining inflation rate in the euro area as a whole and negative rates in some individual countries pose a serious problem; more serious than ECB representatives

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George Soros‘ INET: An institute to improve the world or a Trojan horse of the financial oligarchy?

Let’s assume that there is a financial oligarchy which exerts strong political influence due to the vast amounts of money it controls. Let’s further assume that this financial oligarchy has succeeded in having financial markets deregulated and that this has enabled the financial industry to expand their business massively. Then, in some near or far future, their artfully constructed financial edifice breaks down, because it cannot be hidden any more that the accumulated claims cannot be serviced by the real economy.

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Don’t blame the victims, Mr.Weidmann!

 A working paper published by the European Central Bank (ECB) shows that strong wage increases have not been the cause for troubles of the euro zone’s crisis countries. Rather, capital flows have caused bloated house and asset prices and exaggerated construction activity and unsustainable economic activity in general, which in turn has pushed up wages. This diagnosis flies in the faceof the of the story often retold by the ECB and

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Despite some BIS-economists: Deleveraging does matter

Outstanding credit to the private sector in the euro area has been shrinking for a long time. It is shrinking fast in several peripheral countries and the European Central Bank (ECB) seems unable or unwilling to do anything about it. Given that the economy of the euro area is barely crawling out of recession and that inflation is predicted to be significantly below the central bank’s target rate for the next two years at least, this seems troublesome. Two economists of the Bank for International Settlements (BIS) help out

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Saving might be a virtue for people, but it is a vice for economies

Fabian Lindner of the German macro-economic research institute IMK has submitted a very timely and well-argued piece to the World Economic Reviw: “Does Saving Increase the Supply of Credit? A Critique of Loanable Funds Theory”. He takes on influential theses of luminaries from Larry Summers, over Ben Bernanke to Hans-Werner Sinn by tracing them back to the loanable-funds-fallacy – a fallacy which still rules standard textbooks. His main proposition is simple and not refutable: firms and economies do not operate at full capacity. All research and surveys show that

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World Economic Review

Norbert Häring is Co-Editor oft he World Economic Review (WERa peer-reviewed jounral of the World Economics Associationin line with its commitment to: rigorous economic research; pluralism in the approaches to economic analysis; openness in the procedures and processes; inclusivity of access; and ethical behaviour.. Lead-Editor is John T. Harvey.

The World Economic Review will publish articles in all branches, methods, and paradigmatic approaches of economics, except those related to the history of economic thought, philosophy and methodology for which the WEA has the dedicated journal Economic Thought. Articles with a multidisciplinary content are welcome.

Papers submitted to the World Economic Review that meet minimum standards of professional quality will be posted on the journal’s Discussion Forum in order to solicit comments and discussions.

In line with the commitment of the World Economics Association, the World Economics Journal aims to promote economics’ engagement with the real world so as to confront, explain, and make tractable economic phenomena.

 

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