Who fell in 2009: Those with current account deficits or with extra froth?

Does Europe need more hedge funds? That was one of the more intriguing questions to come out of a one-day seminar on Europe's sovereign debt crisis I attended this week in Brussels. The event was co-sponsored by the IMF and Bruegel, the respected European think tank, and it was held under the Chatham House Rule, which means I can't tell you who said what. But I can give you a few headlines.

In today's VoxEU, Kati Suominen asks "Did global imbalances cause the crisis?, and surveys the arguments. I recently wrote a survey on the same topic for the forthcoming Encyclopedia of Financial Globalization.

By George Dorgan:Eurostat recently published the European exports, imports and trade balance for the first 10 months of 2012 compared with 2011. The data and recent market reactions show that the strategy of "Current Accountists" from Angela Merkel and Hans-Werner Sinn was right (see more on the difference between Current Accountists and Capital Flightests).

Miguel Cardoso, Rafael Doménech, 13 December 2010Are concerns over the sustainability of sovereign debt in Europe justified? This column presents data covering 16 developed countries including Greece, Italy, Portugal, and Spain.

I'VE been thinking a lot about this Michael Pettis post from the weekend, in which he offers some economic predictions for the remainder of the decade. What's most interesting about his thinking is the way he orients his model of economic activity around balance of payment dynamics. Here's an example:

Javier Suarez, 15 August 2011The current Eurozone crisis shows no sign of abating. This column proposes a solution built on three pillars: A Eurozone Charter, a Eurobond Programme, and a Debt Restructuring Programme for insolvent countries.Full Article: A three-pillar solution to the Eurozone crisis

As I was writing last week, one key question for those who believe that higher taxes on high-income people will lead to sharply reduced economic growth is where’s the growth given the substantial reductions in average tax burdens and the giant reductions in marginal tax rates. Another way of putting it might be to ask for some more specifics. How, exactly, are higher tax rates supposed to impoverish the country?