This paper examines three different explanations of the global financial imbalances. It begins with the neoliberal globalization hypothesis that explains the imbalances as the product of the model of globalization implemented over the past thirty years. It then examines the saving glut and reserve currency hypotheses. The paper concludes by arguing that both the saving glut and reserve currency hypotheses are inconsistent with the empirical record and both provide a misleading guide for policy.
A European Public Finance Authority that would be governed by member countries should issue bonds that the ECB can buy and sell through standard open-market operations.
In 2008 President Obama captured the nation with a message of change, yet in office he has chosen to deliver change of style rather than change of substance.
The failure to directly help households has been a grievous policy error. Refinancing still viable mortgages would provide a big boost to the distressed corner of the household sector and purchases of state government bonds could help avoid cutbacks to state and local government employment
New American Foundation - Economic Growth Policy Paper: "The troumbling economics and politics of payng Interest on bank reserves" by Thomas Palley (April 2010).
The institutional arrangements behind the euro have distorted the monetary - fiscal balance, creating deflationary central bank dominance.Its design embeds neo-liberal monetary theory which in many regards rests on the same economic principles as the gold standard.
