Here Nosotros Larn Again

1) Government embarks on austerity, to essay together with maintain the confidence of the bond markets. We must save the AAA rating for our government’s debt, says the finance minister.

2) Austerity reduces demand, helping exercise apartment or negative growth.

3) As a result, deficit targets choke along beingness missed. Additional austerity is imposed, together with increment declines again.

3) Country loses its AAA rating, together with the credit rating agency gives concerns most pathetic increment equally an of import element for the downgrade.

4) This confirms our fears, says the finance minister. We must redouble our efforts to trim down our debt.

This volition audio post past times Bas Jacobs (HT MT) argues that the S&P analysis for the Netherlands does non deserve whatever serious attention. On credit rating agencies generally, see Jonathan Portes. The media study what these agencies tell because downgrades are convenient hooks to hang existing stories on, together with it is a shame together with a continuing root of puzzlement that officials together with politicians bother alongside them.

So why am I writing this post? Because it seems of import to tape the progress of or together with thence other province beside my ain that is going downwardly a depressingly predictable path. When I final wrote most the Netherlands, or together with thence positive increment was expected for 2014, but the OECD’s latest forecast shows gross domestic product apartment side past times side year. These forecasts besides bring consumer cost inflation below 2% inwards 2014 together with below 1% inwards 2015. The output gap is currently over (negative) 4%, together with is expected to hand -5.5% inwards 2015. Unemployment, which was exclusively 4.3% inwards 2011, is expected to ascent to 8.1% inwards 2015.

Like the UK, the Netherlands is a province alongside no job selling its debt. It has no macroeconomic demand to hit an expected (by the OECD) underlying full general authorities surplus past times 2015. As Jacob’s notes, at that spot is no inquiry of an unsustainable long run financial position. The exclusively major lever the authorities has to exercise something most lack of increment together with rising unemployment is financial policy, even together with thence it is using this lever inwards completely the incorrect (pro-cyclical) direction, making everything worse.

A crazy policy. Yet it is followed past times both centre-left together with centre-right parties, fifty-fifty though this agency these parties are haemorrhaging familiar to Great Britain ears, but it is besides what has merely happened inwards the Netherlands.

I exercise non similar using decisions past times the credit rating agencies equally an excuse to write posts, because when it comes to the major economies they bring no item expertise. (Typically markets demo no reaction to the ‘news’ that a province similar the Netherlands has been downgraded.) This useful post past times Bas Jacobs (HT MT) argues that the S&P analysis for the Netherlands does non deserve whatever serious attention. On credit rating agencies generally, see Jonathan Portes. The media study what these agencies tell because downgrades are convenient hooks to hang existing stories on, together with it is a shame together with a continuing root of puzzlement that officials together with politicians bother alongside them.

So why am I writing this post? Because it seems of import to tape the progress of or together with thence other province beside my ain that is going downwardly a depressingly predictable path. When I final wrote most the Netherlands, or together with thence positive increment was expected for 2014, but the OECD’s latest forecast shows gross domestic product apartment side past times side year. These forecasts besides bring consumer cost inflation below 2% inwards 2014 together with below 1% inwards 2015. The output gap is currently over (negative) 4%, together with is expected to hand -5.5% inwards 2015. Unemployment, which was exclusively 4.3% inwards 2011, is expected to ascent to 8.1% inwards 2015.

Like the UK, the Netherlands is a province alongside no job selling its debt. It has no macroeconomic demand to hit an expected (by the OECD) underlying full general authorities surplus past times 2015. As Jacob’s notes, at that spot is no inquiry of an unsustainable long run financial position. The exclusively major lever the authorities has to exercise something most lack of increment together with rising unemployment is financial policy, even together with thence it is using this lever inwards completely the incorrect (pro-cyclical) direction, making everything worse.

A crazy policy. Yet it is followed past times both centre-left together with centre-right parties, fifty-fifty though this agency these parties are haemorrhaging support to those farther left together with right. It is a policy post past times Bas Jacobs (HT MT) argues that the S&P analysis for the Netherlands does non deserve whatever serious attention. On credit rating agencies generally, see Jonathan Portes. The media study what these agencies tell because downgrades are convenient hooks to hang existing stories on, together with it is a shame together with a continuing root of puzzlement that officials together with politicians bother alongside them.

So why am I writing this post? Because it seems of import to tape the progress of or together with thence other province beside my ain that is going downwardly a depressingly predictable path. When I final wrote most the Netherlands, or together with thence positive increment was expected for 2014, but the OECD’s latest forecast shows gross domestic product apartment side past times side year. These forecasts besides bring consumer cost inflation below 2% inwards 2014 together with below 1% inwards 2015. The output gap is currently over (negative) 4%, together with is expected to hand -5.5% inwards 2015. Unemployment, which was exclusively 4.3% inwards 2011, is expected to ascent to 8.1% inwards 2015.

Like the UK, the Netherlands is a province alongside no job selling its debt. It has no macroeconomic demand to hit an expected (by the OECD) underlying full general authorities surplus past times 2015. As Jacob’s notes, at that spot is no inquiry of an unsustainable long run financial position. The exclusively major lever the authorities has to exercise something most lack of increment together with rising unemployment is financial policy, even together with thence it is using this lever inwards completely the incorrect (pro-cyclical) direction, making everything worse.

A crazy policy. Yet it is followed past times both centre-left together with centre-right parties, fifty-fifty though this agency these parties are haemorrhaging supported past times the primal bank, which was one of those voting against the recent cutting inwards ECB involvement rates. The CPB, the country’s financial council that used to last a post past times Bas Jacobs (HT MT) argues that the S&P analysis for the Netherlands does non deserve whatever serious attention. On credit rating agencies generally, see Jonathan Portes. The media study what these agencies tell because downgrades are convenient hooks to hang existing stories on, together with it is a shame together with a continuing root of puzzlement that officials together with politicians bother alongside them.

So why am I writing this post? Because it seems of import to tape the progress of or together with thence other province beside my ain that is going downwardly a depressingly predictable path. When I final wrote most the Netherlands, or together with thence positive increment was expected for 2014, but the OECD’s latest forecast shows gross domestic product apartment side past times side year. These forecasts besides bring consumer cost inflation below 2% inwards 2014 together with below 1% inwards 2015. The output gap is currently over (negative) 4%, together with is expected to hand -5.5% inwards 2015. Unemployment, which was exclusively 4.3% inwards 2011, is expected to ascent to 8.1% inwards 2015.

Like the UK, the Netherlands is a province alongside no job selling its debt. It has no macroeconomic demand to hit an expected (by the OECD) underlying full general authorities surplus past times 2015. As Jacob’s notes, at that spot is no inquiry of an unsustainable long run financial position. The exclusively major lever the authorities has to exercise something most lack of increment together with rising unemployment is financial policy, even together with thence it is using this lever inwards completely the incorrect (pro-cyclical) direction, making everything worse.

A crazy policy. Yet it is followed past times both centre-left together with centre-right parties, fifty-fifty though this agency these parties are haemorrhaging do not.

Coen Teulings, the onetime caput of the CPB, post past times Bas Jacobs (HT MT) argues that the S&P analysis for the Netherlands does non deserve whatever serious attention. On credit rating agencies generally, see Jonathan Portes. The media study what these agencies tell because downgrades are convenient hooks to hang existing stories on, together with it is a shame together with a continuing root of puzzlement that officials together with politicians bother alongside them.

So why am I writing this post? Because it seems of import to tape the progress of or together with thence other province beside my ain that is going downwardly a depressingly predictable path. When I final wrote most the Netherlands, or together with thence positive increment was expected for 2014, but the OECD’s latest forecast shows gross domestic product apartment side past times side year. These forecasts besides bring consumer cost inflation below 2% inwards 2014 together with below 1% inwards 2015. The output gap is currently over (negative) 4%, together with is expected to hand -5.5% inwards 2015. Unemployment, which was exclusively 4.3% inwards 2011, is expected to ascent to 8.1% inwards 2015.

Like the UK, the Netherlands is a province alongside no job selling its debt. It has no macroeconomic demand to hit an expected (by the OECD) underlying full general authorities surplus past times 2015. As Jacob’s notes, at that spot is no inquiry of an unsustainable long run financial position. The exclusively major lever the authorities has to exercise something most lack of increment together with rising unemployment is financial policy, even together with thence it is using this lever inwards completely the incorrect (pro-cyclical) direction, making everything worse.

A crazy policy. Yet it is followed past times both centre-left together with centre-right parties, fifty-fifty though this agency these parties are haemorrhaging speculated most why politicians seem together with thence attached to austerity, when it is together with thence clearly doing their popularity such harm. They seem to last stuck inwards an equilibrium (the ‘austerity trap’) where they fearfulness that if whatever of them broke free, past times declaring austerity harmful, they would lose out because other parties inwards the pump would declare them irresponsible, or ‘not serious’ to purpose Paul Krugman’s language. Yet they would all last improve off, inwards price of non losing back upwardly to the farther left or right, if they could simultaneously intermission gratuitous of the austerity trap. Within whatever unmarried Eurozone province the ‘irresponsibility’ accuse is reinforced past times the Eurozone’s Fiscal Compact, which inwards plow keeps the Eurozone equally a whole inwards the austerity trap.