INTERNATIONAL ECONOMICS

The Next Financial Order

Barry Eichengreen

Will the euro or the SDR become the world’s major reserve currency, ending the decades-long reign of the dollar? Is a global financial regu lator necessary, or can greater cooperation among national authorities ensure financial stability? Can the IMF and World Bank be made more effective?

RECENT COMMENTARIES

FEATURED COMMENTARIES

Europe’s Tobin Tax Distraction

Barry Eichengreen Series: The Next Financial Order

2012-02-09

European leaders have revealed their top-secret plan for solving the euro’s crisis: a version of the “Tobin tax,” a levy on financial transactions first suggested in 1972. The only problem is that the tax was intended to solve an entirely different problem from those that afflict Europe today.... read

Comments: 2 Recommended: 0 Read: 4168

Europe’s Vicious Spirals

Barry Eichengreen Series: The Next Financial Order

2012-01-11

While 2011 was supposed to be the year when European leaders finally got a grip on events, the eurozone’s problems went from bad to worse. The problem is not just that Europe faces a sovereign-debt crisis, but also that it faces a growth crisis, which worsens the debt problem.... read

Comments: 6 Recommended: 1 Read: 20059

Disaster Can Wait

Barry Eichengreen Series: The Next Financial Order

2011-12-09

The coming year will not be one of crisis, but nor will it bring an end to our current economic troubles. Rather, for Europe, the US, and China, 2012 will be a year of muddling through.... read

Comments: 4 Recommended: 1 Read: 31307

Europe’s Darkness at Noon

Barry Eichengreen Series: The Next Financial Order

2011-11-08

It may be hard to imagine that Europe’s crisis could worsen, but it just has. The Greek crisis will not go away until there is reason to hope that Greece can revive economic growth, while Italy and Portugal are heading into the same trap.... read

Comments: 10 Recommended: 0 Read: 38088

Coco for Europe

Barry Eichengreen Series: The Next Financial Order

2011-10-11

After a year and half of delay and denial, Greece is about to restructure its debt. But this by itself will not be enough to draw a line under the eurozone’s existential crisis, for which so-called "contingent convertible bonds," or "cocos," might be the answer.... read

Comments: 3 Recommended: 0 Read: 14199

Europe on the Verge of a Political Breakdown

Barry Eichengreen Series: The Next Financial Order

2011-09-09

If Europe is to avert the worst – a meltdown of the eurozone, if not of the EU itself – it is critical that European leaders distinguish what must be done now from what can be left for later. Indeed, unless they complete three urgent tasks, there will be no reason to discuss long-term reforms.... read

Comments: 21 Recommended: 3 Read: 67793

What Can Replace the Dollar?

Barry Eichengreen Series: The Next Financial Order

2011-08-11

Already before the recent US debt-ceiling imbroglio, the dollar had begun losing its luster as a global reserve currency. But, with the euro facing serious problems of its own, what can replace the greenback?... read

Comments: 11 Recommended: 1 Read: 27676

General Marshall on the Aegean

Barry Eichengreen Series: The Next Financial Order

2011-07-13

So far, the EU's Greek strategy has amounted to squeezing blood from a stone. Instead, Europeans might usefully look back 60 years, to a time when their own countries, perched on the brink of a similar collapse, received the help that they needed to recover – help that has put them in a position to do something similar for Greece today.... read

Comments: 4 Recommended: 0 Read: 16963

How to Kill a Dollar

Barry Eichengreen Series: The Next Financial Order

2011-06-09

Many complain that the Fed's near-zero interest-rate policy is debasing the dollar and eroding the currency’s purchasing power. But, if there is a threat to the dollar, it stems not from monetary policy, but from the fiscal side.... read

Comments: 1 Recommended: 0 Read: 20295

The Full Brady	Barry Eichengreen
Financial markets are increasingly certain that a Greek debt restructuring is coming. Fortunately, there is a way to avoid the worst: emulate the Brady Plan, under which commercial banks, together with official creditors, restructured and took haircuts on the debt of Latin American and Eastern European governments in the 1980’s.... read

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The Full Brady

Barry Eichengreen Series: The Next Financial Order

2011-05-10

Financial markets are increasingly certain that a Greek debt restructuring is coming. Fortunately, there is a way to avoid the worst: emulate the Brady Plan, under which commercial banks, together with official creditors, restructured and took haircuts on the debt of Latin American and Eastern European governments in the 1980’s.... read

Comments: 2 Recommended: 2 Read: 20042

Slowing China

Barry Eichengreen Series: The Next Financial Order

2011-03-09

With the world’s rich countries still hungover from the financial crisis, the global economy has come to depend on emerging markets to drive growth. But Chinese officials warn that their economy is poised to slow – and this time they are right.... read

Comments: 7 Recommended: 1 Read: 25986

Obamanomics: Year One and Beyond

Barry Eichengreen Series: The Next Financial Order

2010-01-22

The great strength of Barack Obama's economic policies - in health care, fiscal stimulus, and stabilizing the banking system - has been not to allow the perfect to become the enemy of the good. But, with the time for crisis management coming to a close, he now needs to aim higher if he is to fulfill his promise of a more economically just society.... read

Comments: 0 Recommended: 0 Read: 18052

What is the IMF’s Mission?

Barry Eichengreen Series: The Next Financial Order

2009-08-21

The IMF has been one of the few beneficiaries of the global economic crisis. But the crisis will not last forever, and the IMF’s critics have not gone away, so the Fund must define its role now, while it still has the world's sympathetic ear.... read

Comments: 0 Recommended: 0 Read: 35955

Is America Catching the “British Disease?”

Barry Eichengreen Series: The Next Financial Order

2010-11-09

In the US, the scent of decline is in the air, as imperial overreach, political polarization, and a costly financial crisis weigh on the economy. Indeed, some now worry that the US, doomed to slow growth, will, like the exhausted Britain that emerged from World War II, be forced to curtail its international commitments.... read

Comments: 12 Recommended: 1 Read: 34758

Why Egypt Should Worry China

Barry Eichengreen Series: The Next Financial Order

2011-02-08

The revolts in Tunisia and Egypt, and protests elsewhere in the Arab world, largely reflect the fact that the benefits of growth have failed to trickle down to disaffected youth. China, with its armies of unemployed university graduates and poorly treated migrant workers, should take note.... read

Comments: 9 Recommended: 0 Read: 34689

Commercialize the SDR

Barry Eichengreen Series: The Next Financial Order

2009-04-27

Zhou Xiaochuan, the governor of the People’s Bank of China, made a splash prior to the recent G-20 summit by arguing that the IMF’s Special Drawing Rights should replace the dollar as the world’s reserve currency. But, for the SDR to become a true international currency, the IMF would have to become more like a global central bank and international lender of last resort.... read

Comments: 0 Recommended: 0 Read: 32604

Europe’s Trojan Horse

Barry Eichengreen Series: The Next Financial Order

2010-02-15

The Greek crisis shows that the EU is still only halfway toward creating a viable monetary union. Unless it creates a proper emergency financing mechanism – and pushes for political integration required to make such a mechanism feasible – the next crisis will make this one look like a walk in the park.... read

Comments: 4 Recommended: 0 Read: 32126

Disaster Can Wait

Barry Eichengreen Series: The Next Financial Order

2011-12-09

The coming year will not be one of crisis, but nor will it bring an end to our current economic troubles. Rather, for Europe, the US, and China, 2012 will be a year of muddling through.... read

Comments: 4 Recommended: 1 Read: 31307

Will Global Imbalances Return?	Barry Eichengreen
Two views have emerged about what caused the current financial and economic crisis, but both camps agree that preventing future crises similar to this one therefore requires resolving the problem of global imbalances. Whether there is a permanent reduction in global imbalances will depend mainly on decisions taken outside the US – and specifically in countries like China.... read
Europe’s Historic Gamble	Barry Eichengreen
The last few weeks have been the most amazing – and important – period of the euro’s 11-year existence. Having doubled their bets on the euro, European leaders now must make their monetary union work.... read

AUTHOR INFO

Barry Eichengreen

Barry Eichengreen is Professor of Economics and Political Science at the University of California, Berkeley. His most recent book is Exorbitant Privilege: The Rise and Fall of the Dollar.

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