Melvyn Krauss
Melvyn Krauss is Senior Research Fellow, Hoover Institution, Stanford University.
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2008-03-27
| Once upon a time, European Central Bank President Jean-Claude Trichet communicated effectively with the outside world. Not anymore.... read |
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2008-02-25
| There appear to be many American conservative voters who believe that the Bush administration has been a disaster, and that Barack Obama offers the best hope for a fresh start. Obama can lose these people, however, if he forgets that he is a reconciler, not a class warrior.... read |
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2008-02-07
| If the French government had its way, Bank of France Governor Christian Noyer would have immediately informed the Élysée Palace of Société Générale's troubles. But by not doing so, Noyer saved the bank from certain bankruptcy.... read |
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2008-01-23
| While Fed Chairman Ben Bernanke has announced a whopping 75-basis-point interest-rate cut, European Central Bank President Jean-Claude Trichet continues to threaten to hike interest rates. But, with the US downturn threatening the global economy – including Europe – Trichet's fear of a wage-price spiral triggered by rapid public-sector wage gains is misplaced.... read |
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2008-01-14
| Europeans are wrong to be angry with China because its currency peg to the US dollar has boosted the euro against most currencies on foreign exchange markets. On the contrary, they should view the currency peg as a valuable gift. ... read |
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2007-12-12
| In the midst of the most serious financial crisis in recent memory, the ECB refuses to cut interest rates, and even continues to insist that it might raise them. That is an unconvincing bluff, but one that reflects the predicament in which the ECB finds itself after leaving interest rates too low for too long.... read |
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2007-11-13
| Ordinary Europeans should not be fooled by arguments that Europe's economy has become "decoupled" from that of the US. Special interests in Europe would not be peddling such dubious pabulum if they felt confident about the economy’s future.... read |
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2007-10-01
| The more French president Nicolas Sarkozy attacks the European Central Bank and the strong euro, the more he is criticized in the European media, by European finance ministers, European Union officials and the ECB itself. The critics are right. The fundamental reason behind France’s current economic weakness is its lack of competitiveness even in other euro-zone economies where the euro is not a factor. ... read |
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2007-08-23
| The US Federal Reserve's recent interest-rate cut suggests that it recognizes the inability of conventional economic theory to account for, much less address, the current turmoil in financial markets. But that is a lesson that the European Central Bank appears not to have learned.... read |
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The ECB’s Honeymoon is Over
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Melvyn Krauss 
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The honeymoon for the European Central Bank is over. Because European interest rates no longer are clearly out of whack with the fundamentals of the euro-zone economy, monetary policy has become more complex. ... read
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2006-01-06
| The most surprising and controversial thing about last December’s rate hike by the European Central Bank was that, after two and a half years of keeping interest rates at exceptionally low levels, the bank ventured an increase of only 25 basis points with no promise of more to come. Political pressure on Europe’s central bank may be the reason for that timid move.... read |
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2005-08-30
| Two wrongs don’t make a right. Just because European governments have failed to put bread on their constituents’ tables doesn’t mean that the European Central Bank should likewise fail in its job of promoting price stability in the euro zone. That may sound obvious, but abandoning price stability is exactly what some European politicians are advocating.... read |
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2005-09-30
| As Europeans watched President Bush stumble over the death, destruction, and chaos wrought by Hurricane Katrina in New Orleans, some could not help patting themselves on the back and saying, “Thank God for our social solidarity.”... read |
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2008-01-14
| Europeans are wrong to be angry with China because its currency peg to the US dollar has boosted the euro against most currencies on foreign exchange markets. On the contrary, they should view the currency peg as a valuable gift. ... read |
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2005-11-25
| The announcement by the President of the European Central Bank, Jean-Claude Trichet, that interest rates would be raised at the next meeting of the bank’s Governing Council on December 1st, could be a defining moment in his presidency. ... read |
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2006-03-06
| The war on terror appears to be causing a surge in protectionism. Some anti-terrorist warriors are so worked up about immigrants that they want to build a wall along the entire United States-Mexican border. They also are fighting the proposed takeover of US ports by a Dubai company, because they fear terrorists could gain vital intelligence from the investments. In Europe, the movement to stop inflows of migrants from Muslim countries is extremely popular.... read |
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2005-11-01
| The US Federal Reserve faces a dilemma, for it needs to continue raising interest rates in the face of a hurricane-devastated economy. The Fed’s failure to raise rates earlier thus holds a powerful lesson for the European Central Bank: after a prolonged period of monetary stability at unusually low interest rates, waiting too long to raise rates to more normal and appropriate levels holds dangerous consequences.... read |
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2005-06-23
| The European Central Bank is making its reputation at this time of turmoil and crisis. Barely a month after the rejection of the European Union Constitution in France and the Netherlands, the EU Summit in Brussels ended in a surprisingly acrimonious orgy of national egoisms and no deal. Then the terrorists struck in London. With all this trouble, the ECB is showing itself to be an “anchor of stability” by steadfastly sticking to its mandate of insuring price stability. ... read |
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2005-06-14
| Who’s he kidding? Maroni’s nostalgia for the lira is little more than a transparent-- and irresponsible-- election ploy by Italy’s Northern League, an attempt to divert blame for the country’s present economic troubles onto Romano Prodi, former EU Commission president and center left candidate in the forthcoming general elections. A return to the lira would be “economic suicide” for Italy according to ECB chief economist Otmar Issing. ... read |
