Status Updates From Europe's Orphan: The Future...

We should not underestimate the eurozone leaders' ability to make things even worse, but the opportunities for improvement are much greater. The eurozone is much more likely to surprise positively than negatively.

Alessandra Casella…pointed out that the problem of spillover effects from national fiscal policy was analogous to the economic problem of pollution. The efficient solution, she suggested, is analogous too: set the overall optimal fiscal deficit and issue 'tradable deficit permits' to the member countries.

Alessandra Casella…pointed out that the problem of spillover effects from national fiscal policy was analogous to the economic problem of pollution. The efficient solution, she suggested, is analogous too: set the overall optimal fiscal deficit and issue 'tradable deficit permits' to the member countries.

There was a time in much of Europe when generals (or worse) took it upon themselves to protect the national interest from dithering politicians. It is less bloody when central banks do it, but nearly as noxious to democracy.

In 2011 an obscure accounting convention, from which the public had been mercifully shielded by the shroud of boredom that usually envelops such things, suddenly morphed into a powerful propaganda tool against the monetary union.

It was Ireland’s peculiar misfortune to have enough rope to hang itself with and to be a member of a club where others expertly tied the knot.

Consider this thought experiment: if Greece had not been a member of the euro, would markets not have offered it cheap finance? Given how lenders were throwing money at American households with no income, or Icelandic banks with no investment record, it is hard to believe they would, uncharacteristically, have had qualms about lending to a European government with no continence.