Here’s an exchange between Tim Worstall and me in the comments to my post below titled “Spain. Please,Mr. Obama, talk about Spain. Please.”: WORSTALL: If you’re going to comment on the Spanish economy might help if you knew something about it. The big three banks, the equivalent of the Wall Street ones? They’re just fine.  […]

ROMNEY: Look, the revenue I get is by more people working, getting higher pay, paying more taxes. That’s how we get growth and how we balance the budget. But the idea of taxing people more, putting more people out of work, you’ll never get there. You’ll never balance the budget by raising taxes. Spain — […]

by Rebecca Wilder Policy transmission mechanism: Broken in Italy, better in SpainYesterday, the Financial Times reported that borrowing costs for small businesses in the periphery were rising relative to the core using the ECB’s release of July MFI interest rate data. I highlighted this point exactly on August 1 following Draghi’s now famous London speech, […]

by Rebecca Wilder Recently we saw retail sales figures come out of Spain, Germany, France, and Italy. Across Europe, the seasonally-adjusted pattern of real retail sales is diverging. The chart above illustrates the real seasonally-adjusted and working-day-adjusted (for Europe) level of retail sales across key countries in Europe and the US (for comparison). The raw […]

Spain vs. Germany vs. UK: production trends showing holes in some growth stories Eurostat reports new orders for January: In January 2011 compared with December 2010, the euro area1 (EA17) industrial new orders index2 rose by 0.1%. In December 20103 the index grew by 2.7%. In the EU271, new orders increased by 0.2% in January […]

This week Trichet laid down the ECB’s hand, (effectively) announcing his intention to maintain inflation at the ECB’s target rather than allow it to overshoot. For all intents and purposes, 2% inflation stabilizes the real exchange rate rather than furthering real depreciation in the Periphery and real appreciation in Germany (or the Core). Ambrose Evans-Pritchard […]