Germany is a reluctant supporter of the EU funds which are being used in the ‘bailout’ of Ireland, and it insists on strict ‘austerity’ conditions, concerned about risk and moral hazard. However, through its central bank, Germany is lending €325bn (December 2010) to other central banks...

The public debt of Greece to foreign governments, including debt to the EU/IMF loan facility and debt through the eurosystem, rose from €47.8bn to €180.5bn between January 2010 and September 2011. €17.1bn of the rise in eurosystem debt was due to an 86% increase in the Greek issue of euro...

The Stability Pact -- intended to make EMU governments run prudent budgets -- is losing its credibility. This article asks the question: what will happen if national debts start to rise again and some governments then have difficulty borrowing? It suggests that there will be calls for bailout,...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...

In the context of a standard model of optimal monetary policy, I argue that expectations should be treated as adaptive rather than rational. This argument is justified by considering the rational expectations equilibrium of this model as the limit point of a sequence in which agents...