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A website forum in which senior fellows of the Peterson Institute for International Economics discuss and debate their responses to global economic and financial developments as they occur each day and offer insights that others might overlook.
Strong advocates of our new G-20 process are convinced that it will bring legitimacy to international economic policy discussions, rule-making, and crisis interventions. Certainly, it’s better than the G-7/G-8 pretending to run things—after all, who elected them?
But who elected the G-20? The answer is: no one. And, [...]
The need for a new equilibrium in global current account and trade imbalances has compelled American policymakers to urge Germany to change its model from that of an export-led economy to one based more on domestic consumption. This would be in keeping with the message delivered in July at the Peterson [...]
The headline news from the G-20 summit in Pittsburgh is that progress has been made on “IMF reform,” meaning increased voting power for emerging markets relative to rich countries—remember that Western Europeans are greatly overrepresented at the IMF for historical reasons. But further change in a sensible direction is [...]
How has the IMF fared in relation to the crisis? The assessment has to be in relation to the three stages of the crisis: the run-up, clean-up, and follow-up. My assessment would be something like: cock-up in the run-up; thumbs-up for the clean-up, and doubts about the follow-up. Here’s [...]
It looks like the G-20 on Friday will emphasize its new “framework” for curing macroeconomic imbalances, rather than any substantive measures to regulate banks, derivatives, or any other primary cause of the 2008–2009 financial crisis.
This is appealing to the G-20 leaders because their call to “rebalance” global [...]