Another summit, another letdown by Europe’s elite December 12, 2011 AUSTAN Goolsbee, former chairman of President Obama’s council of economic advisers, is hardly a virulent eurosceptic. However, his assessment of the prospects of the common currency is very stark: in his view, as long as European leaders remain wedded to a utopian vision of political union in Europe, they will have to keep fighting off [...]
Government spending won’t fix the economy December 12, 2011 WHEN looking at investment data during the recent recession two key things emerge. The first is that UK investment (or “Gross Fixed Capital Formation”) has not fully recovered (see top chart, below). It did bounce back, but once more the growth rate is negative. However, to understand what is going on, it’s important to look [...]
RAPID RESPONSES December 12, 2011 Deutsch courage [Re: David Cameron was right to say No, yesterday] Believe me: most people here in Germany are very concerned about that elite project called €. Once more in history, the UK is doing the right thing. It seems that German leaders haven’t learned anything from the past. See the readers’ comments in German [...]
To save the euro and end the liquidity crisis Germany needs to leave the Eurozone December 11, 2011 THE crisis in the Eurozone is widely portrayed as being about solvency and the need for fiscal balance and austerity, but in fact these are longer term issues – the immediate crisis is one of liquidity. Solvent countries can’t roll over their existing stock of debt, as the available liquidity behind the largest economy in [...]
Cameron must persist with EU reform strategy December 11, 2011 NOW that the dust is beginning to settle on last week’s tumultuous EU summit, where Prime Minister David Cameron blocked a change in the EU treaty, we can start to assess the consequences of his decision. So, what could the summit outcome actually mean for UK financial services? Despite the clamour in much of the [...]
Rolls Building will rule the world undisputed December 11, 2011 IT WILL take some time for the full implications of last week’s EU Summit to become clear. For my part, I will spend much of today in discussion with UK-based EU ambassadors at the Polish presidency’s conference on financial stability and growth, which takes place at the Mansion House. My recent discussions with leading practitioners [...]
RAPID RESPONSES December 11, 2011 Trick of treaty I feel like I’m missing something. Many people are obsessing over the latest Eurozone summit, but as far as I can tell Sarkozy and Merkel have proposed nothing that would make the slightest difference to the Eurozone’s immediate problems. The Sarkozy-Merkel plan is a confidence trick (albeit with a few growth-destroying tax [...]
Cameron must stand up for the City – finance remains this country’s biggest asset December 8, 2011 FRANCE and Germany have sent a detailed letter to Herman Van Rompuy, the president of the EU Council, setting out their wish list ahead of the EU summit. Their desires include tighter rules on deficits, which they hope will calm the markets, but also – and predictably – proposals for a Eurozone financial transaction tax [...]
Private equity is being forced to face new reality December 8, 2011 Cheap money era is over, but there’s still opportunity THERE are those in private equity who like to pretend that our industry somehow escapes the laws of supply and demand. They would prefer investors to believe returns – at least when they are healthy – rest on the “magic touch” of fund managers, rather than [...]
Poetry and capitalism make a heroic couplet December 8, 2011 T.S. ELIOT was a banker, but that hasn’t stopped two poets from refusing to be shortlisted for this year’s prestigious, £15,000 Eliot Prize over a sponsorship deal with Aurum Capital, an investment firm specialising in funds of hedge funds. First Alice Oswald and now John Kinsella have given up their coveted places on the list. [...]