Report
Patrick Artus

Euro zone: The economic policy errors made after the subprime crisis will not be repeated after the COVID crisis; will the opposite economic policy errors be made instead?

After the subprime crisis, two clear economic policy errors were made in the euro zone: It was not until 2015 that monetary policy became expansionary and eliminated the risk of a debt crisis in the peripheral countries; Fiscal policies were tightened rapidly from 2010, which sent the euro zone back into recession. Obviously, these two mistakes will not be made today. Will the opposite mistakes be made instead? Continued fiscal deficits that have little effect on potential growth, for example because they do not sufficiently address the issue of skills, making governments highly vulnerable financially; Growing financial instability (bubbles, speculative investments) due to continued vigorous monetary expansion without any macroprudential policy corrections.
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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