According to Eurostat, the annual inflation rate in the Euro area was only 0.7% in February 2014. A year earlier that same rate stood at 1.8%. This has prompted concerns about the Euro Area slipping into deflation. Deflation is defined as a general decrease of the price level. There have been several such episodes in […]
Are We Heading for Permanent Stagnation?
The global downturn that followed the collapse of Lehman Brothers in 2008 has now lasted for more than five years and the world as a whole is far from normal employment or economic activity. Even the United States, which has seen a healthier recovery than much of Europe, is still struggling with high unemployment and […]
What’s Going On with the Spanish and European Banking System?
The other day, a reporter asked me three questions about the current state of Spanish and European banking. Among all the areas of economic analysis, I find monetary economics and banking most interesting. In 1992, together with three coauthors, I published one of the first articles about general equilibrium economics that had the word “banking” […]
The Tremendous Effects of Lehman Brothers’ Fall Five Years Later
The bankruptcy of Lehman Brothers was the starting point of the worst financial crisis in our recent history. The collapse of one of the most important banking institutions spread its effects worldwide. Are we still suffering the consequences of this surprising fall? Have the authorities implemented new measures to avoid another huge financial and economic […]
Spain Nears Trade Equilibrium
Well, equilibrium is a bit exaggerated. In May, Spain’s trade balance accumulated over 12 months – my favorite way of looking at this data for seasonality – registered a deficit of about 20.5 billion euros, which is equal to roughly 2 percent of the GDP. The data improved by slightly more than 2 billion euros in April, due to an increase […]