On Fiscal Consolidation And Currency Devaluation At The G-20 And Other Links

| 24 June 2010 14:00

G-20 Thoughts

I am going to be talking about the G-20 tomorrow at 700 London Time/1200 East Coast Time on BBC World News. The key issue is fiscal consolidation. I am taking the German side of this (see Why I am siding with the Germans on fiscal consolidation) rather than George Soros’ regarding the euro zone (see Soros attacks Germany’s hair-shirt politics).

I may write up something regarding the US and the UK. The short-hand view I have is that, while the UK and US are less constrained, politically, stimulus is a loser. It is already out in the UK and it is unlikely to gain traction in the US. Malinvestment into the FIRE sector is the key issue which hangs over stimulus as a policy tool (seePrison inmates among those abusing home buyer tax credit – USATODAY.com). I hope to explain why in greater detail a future post.

Irrespective there are other issues like competitive currency devaluations (More on Competitive Currency Devaluations) which loom, especially given the still acrimonious China-US currency relationship.

Also see:

The Usual Fare

avatar About Edward Harrison

Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty years of business experience. He is also a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC, Fox Television and RT Television. He speaks six languages, a skill he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.

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