Fiscal consolidation: Too much of a good thing?

John Van Reenen 27 April 2012

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This week’s political events in the Netherlands and France which look likely to lead to government dissolution, have been interpreted as a set-back for the pace of fiscal consolidation in Europe with popular resentment punishing incumbent leaders (“Leaders in Austerity Backlash” was the headline of the Financial Times on 24 April 2012). The response of the European economic establishment has been to stay the course.

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Topics:  Macroeconomic policy

Tags:  eurozone, fiscal consolidation, Bond market, austerity

Understanding and quantifying contagion

Harald Hau, Choong Tze Chua, Sandy Lai 05 February 2011

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Contagion is one of the more elusive concepts in the current debate about the financial crisis. Indeed, the logic behind it is often unclear.

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Topics:  Europe's nations and regions Global crisis International finance

Tags:  contagion, Eurozone crisis, Bond market

Is there a bubble in the bond market?

Luis M Viceira, John Y Campbell, Adi Sunderam 27 October 2010

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The yields on government bonds are at their lowest levels since the depths of the financial crisis in late 2008. On Monday 18 October, the yield on 10-year Treasury notes hit 2.52%, down from 3.85% at the beginning of the year. This movement is huge by the standards of the Treasury market. An investment in 10-year Treasury notes has returned about 11.4% this year.

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Topics:  Financial markets Frontiers of economic research

Tags:  inflation, expectations, stock market, Bond market, yield

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