The phrase ‘too big to fail’ can be interpreted in two ways – either to suggest that really big institutions are inherently stable thanks to their size and complexity (as they once said of the Titanic) or that the failure of such entities would leave such a big hole in the economy that governments cannot […]
If you thought that the Eurozone crisis was all about sovereign debt – the money that governments borrow to finance their overspending – then you’re wrong. Obviously, sovereign debt is involved, but only as one part of a much bigger picture. Writing for Huffington Post, Simon Johnson and Peter Boone open our eyes: "When Greece quits the […]
What if Greece defaults on its soverign debt? A while back, the story was this: default would trigger a ‘credit event’, which would in turn activate a complex web of insurance agreements, leading to a Lehmans-style meltdown of the European banking system. Thus everything must be done to stop Greece from defaulting. Except that Greece already has […]