Economic Journals: Two Article Summaries and Critiques Word Count: 500 (2 pages) Journal Entry First a summary of the article will be attempted. Basically, what the article The World Economy: Be Afraid is about the value of the euro is now slipping. The main problem is that Angela Merkel, the chancellor of Germany, does not want to admit that much of Germany’s problems have escalated due to bad fiscal policy in German banks—and that it is not because the Italians and the Greeks are quote “lazy” or don’t want to work.
In the past, Merkel has made Germany look bad by also declaring, through her comments, that basically all Turks in Germany should convert to Christianity. Not only was this an insensitive comment, but it shows the small-mindedness of Merkel as a person. The article also accuses Nicholas Sarkozy, President of France, as being too soft on fiscal policy. The writer of the article accuses the leaders of the world of acting Lilliputian, and that Barack Obama is engaging in class warfare instead of acting out of fiscal responsibility. 1 Here is an analysis of the article.
What is basically the main problem both in the U. S. and in Europe is that there are only short-term solutions and a lot of lies coming from politicians. “[Politicians’] mistakes vary, but two sorts stand out. One is an overwhelming emphasis on short-term fiscal austerity over growth…[unfortunately, ] the collective obsession with short-term austerity across the rich world is hurting. The second failure is…honesty. Too many rich-world politicians have failed to tell voters the scale of the problem. ”2 Journal Entry #2 What it seems like is that David Lipton is actually the linchpin that everyone needs in order to solve the European’s crisis with the euro. 3 Sarkozy got rid of his top financial advisor, a woman named Lagarde.
Lagarde left for a position at the IMF. What is problematic is that all the leaders seem to know that they need to take action, but people are still not feeling the pain of the economic ‘pinch’ right now, so world leaders are not responding to the economic worries of ‘the little people, ’.
The euro is not doing well at all in Europe because individual countries are having economic woes. The translation of this article is that, basically, a lot of European leaders do not know what they’re doing. The Europeans are banking on a bankrupt system. The Europeans need a singular leader they can look towards for help. Perhaps David Lipton might be an advisor who is someone of import that knows something about economics. None of the advisors who are in top positions in some of these countries actually are economists of any stripe.
Thus, it should worry the people of Europe and the Americas greatly that many of these top leaders have not hired around them people who are experts at how to manage money, finances, currency, and futures. Knowing how to play the stock market is a skill that any economist or advisor worth his or her salt should know. The Europeans need to figure out fiscal strategy fast. WORKS CITED The Euro Crisis: Is Anyone In Charge?
Retrieved 10 Oct 2011 at: . The World Economy: Be Afraid. Retrieved 10 Oct 2011 at: .