Summer’s here and so are seasonal contracts. The latest employment survey showed the jobless rate in Spain went down to 20% in Q2, its lowest level since the summer of 2010. And yet employment is still a heavy burden for Spaniards, Greece being the only EU country with a higher rate.
Roberto Tamborini, author, Professor of Economy at Trento University says The Corner at this interview that “we can only start on the road towards a satisfactory recovery with fiscal and monetary coordination in the eurozone, and this fiscal stimulus can only be coordinated via Brussels. This directly calls into question the eurozone’s economic governance, one of the pillars of which is the Maastrich principle of exclusive national responsability.”
Ana Fuentes | “Spaniards tend to be schizophrenic because they all want the best services, like they have in the Nordic countries, free education…and you can only have this by paying much higher taxes than we do in Spain where there is a huge amount of fraud and tax evasion,” says William Chislett, associate researcher at the Elcano Royal Institute and former correspondent for The Times and the Financial Times.
Higher capital requirements after the financial crisis are pushing up the cost of capital for European banks. The key question is by how much, since the return on equity required in order to compensate investors for the risk they undertake can be difficult to determine because it is unobservable.
South Korean economist Ha-Joon Chang argues that although orthodox thinking is to cut debt, the most effective way for countries to grow is to boost their income. As for the recovery, this expert in emerging markets notes that the world economy is not really picking up in the way that it usually does after a big downturn. This is the first part of our conversation.
How do we overcome a debt crisis with more debt? Bocconi University’s Marcello Minenna recalls that in a world with inflation it is always possible to control the behaviour of the debt/GDP ratio just by reaching negative real interest rates. Also, he points out that eight years after the financial meltdown the tight interconnections in real time between the global markets make the system intrinsically unstable.
Are we putting the responsilibity of exiting the crisis on central banks’ shoulders? Is ECB’s president Mario Draghi doing traders a favour by playing down the ECB’s responsibility for contributing to volatility? Professor of Financial Mathematics at Bocconi’s University Marcello Minenna answers to these questions from Milan and argues that a low interest rate environment is here to stay.
LONDON | June 3, 2015 | UBS | The fact that the Eurozone’s headline inflation pick-up was related not just to headline HICP but also to core inflation will be acknowledged positively by President Draghi in today’s press conference. Yet, the ECB will be careful not to deviate from the message it has given in recent months.
MADRID | May 29, 2015 | By Ana Fuentes | German bund futures spiked higher on Friday after traders cited comments by IMF’s Christine Lagarde to the Frankfurter Allgemeine Zeitung that a Greek exit from the euro zone was a possibility. As Ms Lagarde’s words heated the debate worldwide, the IMF insisted the German paper mistranslated her as too hawkish on Grexit. The print version of the interview published today is slightly different (see screenshots above).
MADRID | May 14, 2015 | By Ana Fuentes | In the second part our his interview with The Corner, Glasgow University Professor John Holland suggests Europe adopts America’s tough stance on criminal activities in the financial industry.