Tyler Cowen lists twelve points on the Euro bailout, linking to some other sophisticated writers in the process.
Today is going to be a great day for equities, but I'm definitely bearish long-term on this move. I think Cowen's last point is his best:
12. How much time has the EU bought itself?
And that's the $64,000 question.
That's a great post by Cowen. I've been reading him pretty regularly along with krugman (left) and mankiw (right, although pretty moderate on most issues), and while his posts are often complete conjecture he can stand in the pocket and trade blows on some heavy hitting econ as well.
ReplyDeleteNumber 10 is my favorite insight in that list. Rehn's signalling strength to the markets, but you do have to worry weather it's reassuring that the EU is stepping in and using all available resources, or whether it's a scary dogmatic attachment to a mistaken economic plan.
I agree that the Euro is coming under a lot of pressure and is likely to see some quantatative easing, but I'm not sold on the dissolution of the Euro yet...