"It is easy to confuse what is with what ought to be, especially when what is has worked out in your favor."
- Tyrion Lannister

"Lannister. Baratheon. Stark. Tyrell. They're all just spokes on a wheel. This one's on top, then that's ones on top and on and on it spins, crushing those on the ground. I'm not going to stop the wheel. I'm going to break the wheel."

- Daenerys Targaryen

"The Lord of Light wants his enemies burned. The Drowned God wants them drowned. Why are all the gods such vicious cunts? Where's the God of Tits and Wine?"

- Tyrion Lannister

"The common people pray for rain, healthy children, and a summer that never ends. It is no matter to them if the high lords play their game of thrones, so long as they are left in peace. They never are."

- Jorah Mormont

"These bad people are what I'm good at. Out talking them. Out thinking them."

- Tyrion Lannister

"What happened? I think fundamentals were trumped by mechanics and, to a lesser extent, by demographics."

- Michael Barone

"If you want to know what God thinks of money, just look at the people he gave it to."
- Dorothy Parker

Monday, June 25, 2012

Pearlstein Gets Europe Half Right by Dean Baker

Steven Pearlstein gets half of the story of the euro zone right, it will take renewed spending supported by euro-wide bonds to end the crisis. But that is only half. To restore the competitiveness of the peripheral countries, Germany and other core countries will have to see higher inflation.
We are not going to see prices actually fall in Spain and Italy. This means that if output in these countries is going to become competitive again in a reasonable period of time we will need to see inflation in the 3-4 percent range (possibly higher) in Germany and other core countries.
In keeping with this target, the European Central Bank should be the issuer or guarantor of the bonds. This should help to bring about the higher rate of inflation that is needed to restore balance between the euro zone regions.

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