We argue that the various proposals aimed at stabilizing the Eurozone using financial engineering do not eliminate the inherent instability of the sovereign bond markets in a monetary union. During crises, this instability becomes systemic and no amount of financial engineering can stabilize an...

In 2011, Portugal was subjected to one of the most stringent austerity packages implemented during the Eurozone crisis, a package known as the troika program. The interpretation of the effects of this program led to a vivid confrontation between two opposing views. A Keynesian view stressed the...