Economics

Economics

One of the main global economic concerns before the financial crisis was the presence of large“global imbalances,” which refer to the massive and persistent current account deficitsexperienced by the U.S. and financed by the periphery. This concern was intellectuallygrounded on the...

The recent financial crisis has damaged the reputation of macroeconomics, largely for its inability to predict the impending financial and economic crisis. To be honest, this inability to predict does not concern me much. It is almost tautological that severe crises are essentially...

The United States is currently engulfed in the most severe financial crisis since the GreatDepression. The crisis was triggered by thecrash in the real estate “bubble” and amplifiedby the extreme concentration of risk in a highlyleveraged financial sector.Conventional wisdom is that both the...