Germany’s important Target-2 €902 bn debate. What happenes if a country leaves euro

Europe and the rest of the world should be examining the debate among German economists about what would happen to the Target-2 intra-euro area imbalances if a member country left Europe’s economic and monetary union. Target-2, an operating arm of the European financial system set up in the 1990s to regulate interbank credit, has grown […]

Germany, EU’s future threat: the ordoliberal utopia of a debt-free state

The observation that the eurozone is unsustainable does not lead ineluctably to a forecast that it will necessarily break apart. But there are events that greatly increase the likelihood of that outcome. Last week’s German budget is one of them. Olaf Scholz, Germany’s new Social Democratic finance minister, has proposed a budget with the following […]

Greenspan: truculent view on Target-2 points to ‘destabilising’ euro

Rising creditor-debtor central bank balances in the euro area under the Target-2 overdraft system underline the ‘destabilising potential’ of the European single currency, according to Alan Greenspan, former chairman of the Federal Reserve board. Greenspan, a sprightly yet wistful 92, used a New York dinner organised by the World Gold Council and NYU Stern Business […]