g-20   22

Jan Wouter - Investment Treaties: A Renewed Plea for Multilateralism | OECD Insights - Sept 2015
Jan Wouters, Professor of International Law, Director of the Leuven Centre for Global Governance Studies, University of Leuven -- We are living in interesting times for investment treaties, whether bilateral treaties or investment chapters in free trade agreements. Never before have they aroused such an interest from parliaments. People and politicians alike are concerned about their impact on international and domestic affairs. Their scope is expanding dramatically: just think of mega deals like the Trans-Pacific Partnership (TPP) or the Transatlantic Trade and Investment Partnership (TTIP), and the rise of intra-regional investment agreements. Debates on investment agreements have intensified recently within the EU because of the European Commission’s newly-acquired exclusive powers in this arena.
trade-agreements  ISDS  capital_flows  emerging_markets  FDI  OECD  multilateralism  Pocket  arbitration  global_governance  G-20  investment-bilateral_treaties  from pocket
september 2015 by dunnettreader
Wie das ZDF die Deutschen verhetzt
RT Whatever happened to journalism... RT : Wie das ZDF die Deutschen verhetzt. -20
G-20  Greece  from twitter
june 2012 by bjoerngrau
2011 In Review: Four Hard Truths
By Olivier Blanchard

(Versions in  عربي, 中文, Español, Français, Русский, 日本語)

What a difference a year makes …

We started 2011 in recovery mode, admittedly weak and unbalanced, but nevertheless there was hope. The issues appeared more tractable: how to deal with excessive housing debt in the United States, how to deal with adjustment in countries at the periphery of the Euro area, how to handle volatile capital inflows to emerging economies, and how to improve financial sector regulation.

It was a long agenda, but one that appeared within reach.

Yet, as the year draws to a close, the recovery in many advanced economies is at a standstill, with some investors even exploring the implications of a potential breakup of the euro zone, and the real possibility that conditions may be worse than we saw in 2008.

I draw four main lessons from what has happened.

•        First, post the 2008-09 crisis, the world economy is pregnant with multiple equilibria—self-fulfilling outcomes of pessimism or optimism, with major macroeconomic implications.

Multiple equilibria are not new. We have known for a long time about self-fulfilling bank runs; this is why deposit insurance was created. Self-fulfilling attacks against pegged exchange rates are the stuff of textbooks. And we learned early on in the crisis that wholesale funding could have the same effects, and that runs could affect banks and non-banks alike. This is what led central banks to provide liquidity to a much larger set of financial institutions.

What has become clearer this year is that liquidity problems, and associated runs, can also affect governments. Like banks, government liabilities are much more liquid than their assets—largely future tax receipts. If investors believe they are solvent, they can borrow at a riskless rate; if investors start having doubts, and require a higher rate, the high rate may well lead to default. The higher the level of debt, the smaller the distance between solvency and default, and the smaller the distance between the interest rate associated with solvency and the interest rate associated with default.  Italy is the current poster child, but we should be under no illusion: in the post-crisis environment of high government debt and worried investors, many governments are exposed. Without adequate liquidity provision to ensure that interest rates remain reasonable, the danger is there.

•       Second, incomplete or partial policy measures can make things worse.

We saw how perceptions often got worse after high-level meetings promised a solution, but delivered only half of one. Or when plans announced with fanfare turned out to be insufficient or hit practical obstacles.

The reason, I believe, is that these meetings and plans revealed the limits of policy, typically because of disagreements across countries. Before the fact, investors could not be certain, but put some probability on the ability of players to deliver. The high-profile attempts made it clear that delivery simply could not be fully achieved, at least not then.  Clearly, the proverb, “Better to have tried and failed, than not to have tried at all,” does not always apply.

•        Third, financial investors are schizophrenic about fiscal consolidation and growth.

They react positively to news of fiscal consolidation, but then react negatively later, when consolidation leads to lower growth—which it often does. Some preliminary estimates that the IMF is working on suggest that it does not take large multipliers for the joint effects of fiscal consolidation and the implied lower growth to lead in the end to an increase, not a decrease, in risk spreads on government bonds.  To the extent that governments feel they have to respond to markets, they may be induced to consolidate too fast, even from the narrow point of view of debt sustainability.

I should be clear here. Substantial fiscal consolidation is needed, and debt levels must decrease. But it should be, in the words of Angela Merkel, a marathon rather than a sprint. It will take more than two decades to return to prudent levels of debt.  There is a proverb that actually applies here too: “slow and steady wins the race.”

•         Fourth, perception molds reality.

Right or wrong, conceptual frames change with events. And once they have changed, there is no going back. For example, nothing much happened in Italy over the summer. But, once Italy was perceived as at risk, this perception did not go away. And perceptions matter: once the “real money’’ investors have left a market, they do not come back overnight.

A further example: not much happened to change the economic situation in the Euro zone in the second half of the year. But once markets and commentators started to mention the possible breakup of Euro, the perception remained and it also will not easily go away.  Many financial investors are busy constructing strategies in case it happens.

Put these four factors together, and you can explain why the year ends much worse than it started.

Is all hope lost? No, but putting the recovery back on track will be harder than it was a year ago. It will take credible but realistic fiscal consolidation plans. It will take liquidity provision to avoid multiple equilibria. It will take plans that are not only announced, but implemented. And it will take much more effective collaboration among all involved.

I am hopeful it will happen. The alternative is just too unattractive.

Published on iMFdirect blog.

Olivier Blanchard is Economic Counsellor and Chief Economist at the International Monetary Fund.
Advanced_Economies  Economic_Crisis  Economic_outlook  Economic_research  Emerging_Markets  Employment  Europe  Financial_Crisis  Fiscal_policy  Fiscal_Stimulus  G-20  growth  International_Monetary_Fund  Multilateral_Cooperation  Public_debt  recession  consolidation  debt  euro_area  financial_sector_regulation  IMF  iMFdirect  investors  Italy  liquidity  multiple_equilibria  Olivier_Blanchard  perception  recovery  United_States._capital_flows  year_in_review  from google
december 2011 by ntnpb
2011 In Review: Four Hard Truths
By Olivier Blanchard

(Versions in  عربي, 中文, Español, Français, Русский, 日本語)

What a difference a year makes …

We started 2011 in recovery mode, admittedly weak and unbalanced, but nevertheless there was hope. The issues appeared more tractable: how to deal with excessive housing debt in the United States, how to deal with adjustment in countries at the periphery of the Euro area, how to handle volatile capital inflows to emerging economies, and how to improve financial sector regulation.

It was a long agenda, but one that appeared within reach.

Yet, as the year draws to a close, the recovery in many advanced economies is at a standstill, with some investors even exploring the implications of a potential breakup of the euro zone, and the real possibility that conditions may be worse than we saw in 2008.

I draw four main lessons from what has happened.

•        First, post the 2008-09 crisis, the world economy is pregnant with multiple equilibria—self-fulfilling outcomes of pessimism or optimism, with major macroeconomic implications.

Multiple equilibria are not new. We have known for a long time about self-fulfilling bank runs; this is why deposit insurance was created. Self-fulfilling attacks against pegged exchange rates are the stuff of textbooks. And we learned early on in the crisis that wholesale funding could have the same effects, and that runs could affect banks and non-banks alike. This is what led central banks to provide liquidity to a much larger set of financial institutions.

What has become clearer this year is that liquidity problems, and associated runs, can also affect governments. Like banks, government liabilities are much more liquid than their assets—largely future tax receipts. If investors believe they are solvent, they can borrow at a riskless rate; if investors start having doubts, and require a higher rate, the high rate may well lead to default. The higher the level of debt, the smaller the distance between solvency and default, and the smaller the distance between the interest rate associated with solvency and the interest rate associated with default.  Italy is the current poster child, but we should be under no illusion: in the post-crisis environment of high government debt and worried investors, many governments are exposed. Without adequate liquidity provision to ensure that interest rates remain reasonable, the danger is there.

•       Second, incomplete or partial policy measures can make things worse.

We saw how perceptions often got worse after high-level meetings promised a solution, but delivered only half of one. Or when plans announced with fanfare turned out to be insufficient or hit practical obstacles.

The reason, I believe, is that these meetings and plans revealed the limits of policy, typically because of disagreements across countries. Before the fact, investors could not be certain, but put some probability on the ability of players to deliver. The high-profile attempts made it clear that delivery simply could not be fully achieved, at least not then.  Clearly, the proverb, “Better to have tried and failed, than not to have tried at all,” does not always apply.

•        Third, financial investors are schizophrenic about fiscal consolidation and growth.

They react positively to news of fiscal consolidation, but then react negatively later, when consolidation leads to lower growth—which it often does. Some preliminary estimates that the IMF is working on suggest that it does not take large multipliers for the joint effects of fiscal consolidation and the implied lower growth to lead in the end to an increase, not a decrease, in risk spreads on government bonds.  To the extent that governments feel they have to respond to markets, they may be induced to consolidate too fast, even from the narrow point of view of debt sustainability.

I should be clear here. Substantial fiscal consolidation is needed, and debt levels must decrease. But it should be, in the words of Angela Merkel, a marathon rather than a sprint. It will take more than two decades to return to prudent levels of debt.  There is a proverb that actually applies here too: “slow and steady wins the race.”

•         Fourth, perception molds reality.

Right or wrong, conceptual frames change with events. And once they have changed, there is no going back. For example, nothing much happened in Italy over the summer. But, once Italy was perceived as at risk, this perception did not go away. And perceptions matter: once the “real money’’ investors have left a market, they do not come back overnight.

A further example: not much happened to change the economic situation in the Euro zone in the second half of the year. But once markets and commentators started to mention the possible breakup of Euro, the perception remained and it also will not easily go away.  Many financial investors are busy constructing strategies in case it happens.

Put these four factors together, and you can explain why the year ends much worse than it started.

Is all hope lost? No, but putting the recovery back on track will be harder than it was a year ago. It will take credible but realistic fiscal consolidation plans. It will take liquidity provision to avoid multiple equilibria. It will take plans that are not only announced, but implemented. And it will take much more effective collaboration among all involved.

I am hopeful it will happen. The alternative is just too unattractive.

Published on iMFdirect blog.

Olivier Blanchard is Economic Counsellor and Chief Economist at the International Monetary Fund.
Advanced_Economies  Economic_Crisis  Economic_outlook  Economic_research  Emerging_Markets  Employment  Europe  Financial_Crisis  Fiscal_policy  Fiscal_Stimulus  G-20  growth  International_Monetary_Fund  Multilateral_Cooperation  Public_debt  recession  consolidation  debt  euro_area  financial_sector_regulation  IMF  iMFdirect  investors  Italy  liquidity  multiple_equilibria  Olivier_Blanchard  perception  recovery  United_States._capital_flows  year_in_review  from google
december 2011 by ntnien
iMFdirect—Our Top 10 Posts
As iMFdirect looks back at two years since our blog on global economics was launched in August 2009, we’ve compiled a list of  the posts that have drawn the most attention.

Collectively, the posts give a snapshot of some of the biggest challenges in the world economy—which because of this summer’s developments remain, in some ways, much the same today as two years ago. It’s worth noting that John Lipsky’s outlook for 2011 listed as the No. 1 downside risk to the global economy: “Renewed turbulence in sovereign debt markets could spill over to the real economy and across regions.”

From the start our aim has been to stimulate debate about global economic issues and to open up discussion, through the blog, to a broader audience. During the past two years we’ve had more than 200 posts from leading economists, including several Nobel Prize winners. Many have been reproduced by other blogs around the world and hundreds of people have provided comment and feedback, and participated in constructive debate.

Here are the iMFdirect posts that have drawn the highest number of views:

1. Ten Commandments for Fiscal Adjustment in Advanced Economies

2. Rewriting the Macroeconomists’ Playbook in the Wake of the Crisis

3. Fair and Substantial—Taxing the Financial Sector

4. 2010 Outlook: New Year, New Decade, New Challenges

5. The Future of Macroeconomic Policy: Nine Tentative Conclusions

6. Nanjing and the New International Monetary System

7. Global Safety Nets: Crisis Prevention in an Age of Uncertainty

8. 2011—A Pivotal Year for Global Cooperation

9. Warning! Inequality May Be Hazardous to Your Growth

10. Thinking Beyond the Crisis: Themes from the IMF’s 10th Annual Research Conference

Let us know what you think and subjects you would like to discuss. What would you like to see more of and what less of? We welcome your views and comments.
Advanced_Economies  Africa  Asia  Economic_Crisis  Economic_outlook  Economic_research  Europe  Financial_Crisis  Financial_regulation  Financial_sector_supervision  Fiscal_policy  G-20  Globalization  growth  IMF  Inequality  International_Monetary_Fund  Latin_America  LICs  Middle_East  Multilateral_Cooperation  Public_debt  recession  blog  global_economy  iMFdirect  international_monetary_system  John_Lipsky  macroeconomics  Nobel_Prize  outlook  top_blogs  from google
august 2011 by ntnpb
iMFdirect—Our Top 10 Posts
As iMFdirect looks back at two years since our blog on global economics was launched in August 2009, we’ve compiled a list of  the posts that have drawn the most attention.

Collectively, the posts give a snapshot of some of the biggest challenges in the world economy—which because of this summer’s developments remain, in some ways, much the same today as two years ago. It’s worth noting that John Lipsky’s outlook for 2011 listed as the No. 1 downside risk to the global economy: “Renewed turbulence in sovereign debt markets could spill over to the real economy and across regions.”

From the start our aim has been to stimulate debate about global economic issues and to open up discussion, through the blog, to a broader audience. During the past two years we’ve had more than 200 posts from leading economists, including several Nobel Prize winners. Many have been reproduced by other blogs around the world and hundreds of people have provided comment and feedback, and participated in constructive debate.

Here are the iMFdirect posts that have drawn the highest number of views:

1. Ten Commandments for Fiscal Adjustment in Advanced Economies

2. Rewriting the Macroeconomists’ Playbook in the Wake of the Crisis

3. Fair and Substantial—Taxing the Financial Sector

4. 2010 Outlook: New Year, New Decade, New Challenges

5. The Future of Macroeconomic Policy: Nine Tentative Conclusions

6. Nanjing and the New International Monetary System

7. Global Safety Nets: Crisis Prevention in an Age of Uncertainty

8. 2011—A Pivotal Year for Global Cooperation

9. Warning! Inequality May Be Hazardous to Your Growth

10. Thinking Beyond the Crisis: Themes from the IMF’s 10th Annual Research Conference

Let us know what you think and subjects you would like to discuss. What would you like to see more of and what less of? We welcome your views and comments.
Advanced_Economies  Africa  Asia  Economic_Crisis  Economic_outlook  Economic_research  Europe  Financial_Crisis  Financial_regulation  Financial_sector_supervision  Fiscal_policy  G-20  Globalization  growth  IMF  Inequality  International_Monetary_Fund  Latin_America  LICs  Middle_East  Multilateral_Cooperation  Public_debt  recession  blog  global_economy  iMFdirect  international_monetary_system  John_Lipsky  macroeconomics  Nobel_Prize  outlook  top_blogs  from google
august 2011 by ntnien
Realtime: After the G-20: Time for Realism in Global Financial Regulation
"Global finance cannot realistically be submitted to a single rulebook. The Basel Accord itself sets a minimum standard, not an optimum one. Several jurisdictions, from Switzerland to China, are considering higher requirements. Processes for preventing and managing large banking failures remain heterogeneous, as the Financial Stability Board (FSB), which coordinates the world’s financial regulators, acknowledged in a report to the Seoul Summit. Global accounting standards convergence is likely to be much more protracted and diverse than generally anticipated before the crisis."
how-to  basel3  G-20 
november 2010 by bionicturtle
Podcamp Pittsburgh Cast: G20 Roundtable | Pittsburgh Podcamp
I was one of the guests at this virtual roundtable, speaking about social media and the coming G-20 meeting in Pittsburgh.
podcasting  elizabethperry  social  ego  pittsburgh  G-20  media  web2.0 
september 2009 by elizabethperry

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