Friday, August 5, 2011

The Burden of Excessive Creditability

And so the "theory" goes: a flexible exchange rate plus financial trustworthiness should equal a ticket to macroeconomic paradise. In normal times, this isn't only solid, it's good sense.

But during these days of planned global monetary chaos, ask the Swiss what they've been thinking of the "theory." It isn't their fault: they have done their homework, but the burden has an insidious alien origin.

The irony is that, for once, they may be having Eurozone envy. An interpretation that won't be found neither in the WSJ nor in the FT, after all their readers may have more important things to learn, such as that Portugal and Ireland are less creditable than Venezuela and Pakistan.

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