Cambridge University Press 978-1-108-49398-7 — Oracles, Heroes Or Villains George E

Cambridge University Press 978-1-108-49398-7 — Oracles, Heroes or Villains George E. Shambaugh Index More Information

Index

ABSPP. See asset-backed securities prelude to, 61–72 purchase programme Economic Emergency Law, 51, 85 Alderete, Carlos, 48 economic liberalism in, 219–220 Alfonsín, Ricardo Luis, 88 economic markets in, 60, 72, 97 Alfonsín Foulkes, Raúl Ricardo, 43–50, 57, recovery of, 89–94 99 economic policy in Final Point Law, 48 historical analysis of, 40–42 Flexibilization plan, 47 market behavior as influence on, 60, Law of Due Obedience, 48 72, 97 Alogoskoufis, Georgios, 85 economic recovery in, 72–98 Álvarez, Carlos, 66–67 in global markets, 89–94 American Recovery and Reinvestment Act IMF role in, 74–76 (ARRA), US (2009), 126–127 political consolidation as factor in, 83–89 AMLF. See Asset-Backed Commercial prudence in, 94–96 Paper Money Market Mutual Fund Final Point Law, 48 Liquidity Facility fixed exchange rates in, 212 APP. See asset purchase programme Flexibilization plan in, 47 Arafat, Yasser, 78 IMF and, 68, 90, 101 Arend, Anthony, 29 economic recovery and, 74–76 Argentina. See also Alfonsín Foulkes, Raúl sanctions by, 84 Ricardo; Duhalde, Eduardo; inflation battles in, from 1983-1996, Fernández de Kirchner, Cristina; 42–61, 44, 42–61, 43 Kirchner, Néstor; Menem, Carlos economic liberalism as influence on, Austral Plan in, 37, 99 43–50 economic market management under, economic uncertainty and, 51–54 216–217 economic victory over, 54–59 economic success of, 46, 60–61 Great Inflation Battle, 62 private sector liquidity under, 13 Great War as influence on, 59–61 Bonex Plan, 53 neo-liberalism as influence on, 54–59 Convertibility Plan, 13, 31, 57–58, Law of Due Obedience, 48 99–100, 219–220 Lock Law, 80, 86–87 debt obligations of, 79–80, 89–90 net foreign investment in, 62 Rights upon Future Offers (RUFO) Olivos Pact, 57–58 clauses, 92 populism in, resurgence of, 72–98 deference in, 32–33 private sector liquidity in, 13–14 Dirty War and, 44, 52 Austral Plan, 13 DNUs in. See Decrees of Necessity and Convertibility Plan, 13, 31 Urgency Repsol YPF, 67–68, 90–91 economic crises in, xiii, 18, 65, 98–102 nationalization of, 88 constitutive power as influence on, 72 RIC in, 59–60, 63–64 liability dollarization, 63 Spring Plan, 49 pre-crisis risks, 69 State Reform Law, 51

248

Index 249

Washington Consensus and, 40 Binner, Hermes Juan, 88 during Menem presidency, 52–53 Blejer, Mario, 78–79 White Knights in, 66–71 Bloom, Nick, 144 Armedáriz, Alejandro, 48 Boehner, John, 120 ARRA. See American Recovery and Bonex Plan, 53 Reinvestment Act Bordón, José Octavio, 78 Asmussen, Jörg, 187, 199, 201, 217–218 Born, Brooksley, 112–113 asset purchase programme (APP), 3–4, Boudou, Amando, 88 196–197. See also asset-backed Brodersohn, Mario, 49 securities purchase programme Burns, Arthur, 31, 148–151 Asset-Backed Commercial Paper Money Bush, George W., 18–32, 78, 123, 128–129 Market Mutual Fund Liquidity Greenspan and, 115–116 Facility (AMLF), 135 September 11, 2001 terror attacks, asset-backed securities purchase 114–116 programme (ABSPP), 196–197 tax cuts under, 114–116 Austral Plan, in Argentina, 37, 99 economic market management under, Cameron, David, 178, 201 216–217 Caputo, Nicolás, 49–96 economic success of, 46, 60–61 Carrió, Elisa, 83 private sector liquidity under, 13 Carville, James, 109–110 authority, economic Cavallo, Domingo, xiii–xv, 13, 31, 36, 38 of ECB, 197–205 as anti-inﬂationary hero, 69–71 with OMT program, 200–205 concentration of authority by, 72 RIC and, 30 economic liberalism promoted by, under Treaty of Lisbon, 199–205 219–220 two pillar strategy of, 197–199 economic policy strategies, 55–56, of economic markets, 209–210, 218–220 99–100 elements of, 30 investors’ expectations under, 41 predictions of economic policy and, Menem and, 53–54, 59, 61 34–38 CBPP. See covered bond purchase in RIC, 29–30 programme of ECB, 30, 197–205 central banks, 5–6 of Federal Reserve, 30 CFTC. See Commodity Futures Trading Commission Bachrach, Peter, 214 check and balances, within US government, Bair, Sheila, 134 xii–xiii Baker, Scott, 144 CJEU. See Court of Justice of European banks Union central banks, 5–6 Clinton, Bill, 31, 36, 66 cross-border banking, 17 economic policy under, 105–125 inter-bank lending, 17 prioritization of, 108–116 Baratz, Morton, 214 Greenspan and, 109, 111–112, 148–149 Barnett, Michael, 214 1993 Economic Plan Barroso, José Manuel, 200 deference in, 110–112 Bastasin, Carlo, 167, 169, 173 success of, 110–112 Baucus, Max, 118 validation of, 110–112 bazooka theory, of economics, 1–2, 68, 162, Republican Revolution and, 119 203 Clinton, Hillary, 111 Bentsen, Lloyd, 110 Cobos, Julio, 83, 85 Berlusconi, Silvio, 32, 184–185, 221 Commercial Paper Funding Facility Bernanke, Ben, xiv, 103, 108–150. See also (CPFF), 135 Federal Reserve Commodity Futures Modernization Act, TARP, 37, 126–127, 129 US (2000), 108, 112, 219 Bernstein, Jared, 31 Commodity Futures Trading Commission Bignone, Reynaldo, 44 (CFTC), 112–113, 134

250 Index

Concepción, Juan, 47 Dodd-Frank Wall Street Reform and Congress, US Consumer Protection Act, US Federal Reserve and, authority of, (2010), 126–127 116–123 Draghi, Mario, xiii–xiv, 2, 37, 152, 154, ESF financing and, 117–119 184, 189, 199, 218, 221. See also IMF loans and, 116–117 European Central Bank 1995 budget battles, 119–123 OMT program, 2–3, 174–175, 200–205 Plan B and, 116–119 Dromi, José Roberto, 53 during financial crisis of 2008, 135–138 Duhalde, Eduardo, 56, 66–71, 74–75 Consumer Fear Index, 144–145 Corrales on, 75 Consumer Sentiment Index, 144–145 economic policy under, 74–76 Contract with America Advancement Act, Duisenberg, Willem, 197–198 US (1996), 123 Dujovne, Nicolás, 95–96 Convertibility Plan, in Argentina, 13, 31, Duvall, Raymond, 214 57–58, 99–100, 219–220 corporate sector purchase programme East Asian financial crisis, 18 (CSPP), 196–197 EC. See European Commission Corrales, Javier, 54–56, 130 ECB. See European Central Bank on Duhalde, 75 economic authority. See authority Corrigan, Gerry, 58, 219 economic crises, xii–xiv. See also Eurozone; Court of Justice of European Union specific countries (CJEU), 154 activism by economic institutions, 4–5 covered bond purchase programme bazooka theory, 1–2, 68, 162, 203 (CBPP), 196–197 causes of, xv–xvi Cox, Christopher, 122–123 central banks’ role in, 5–6 CPFF. See Commercial Paper Funding in East Asia, 18 Facility in Eurozone, 18 cross-border banking, 17 national governments’ response to, 18 Cruz, Ted, 129, 142 Tequila Crisis, 18 CSPP. See corporate sector purchase Economic Emergency Law, Argentina, 51, programme 85 Economic Growth and Tax Relief D’Alema, Massimo, 185–186 Reconciliation Act, US (2001), D’Amato, Alfonse, 118 114–115 Davis, Steven, 144 economic liberalism debt ceiling crisis, 121–123 in Argentina, 43–50, 219–220 Decrees of Necessity and Urgency (DNUs), Cavallo’s promotion of, 219–220 51 Greenspan’s promotion of, 218–219 deference economic markets in Argentina, 32–33 actor threats in, 220–221 of economic markets, 210, 214–220 in Argentina, 60, 72, 97 in Eurozone, 163–165 economic recovery for, 89–94 during financial crisis of 2008, under Austral Plan, 216–217 132–135 authority of, 209–210, 218–220 during Greek economic crisis, 163–165 deference of, 210, 214–220 predictions of economic policy and, during financial crisis of 2008, 143 34–36, 38 fortune in, role of, 221–223 in RIC, 31–33 implementation capacity of, 210, in Argentina, 32–33 218–220 in U.S economic policy, 105–125 management of, 213–221 Dijsselboem, Jeroen, 192–193 by ECB, 171 Dirty War, 44, 52 through political authority, 215–218 Discount Rate, 107 through power of institutions, 215–218 DNUs. See Decrees of Necessity and OMT programs and, 217–218 Urgency RIC and, 210–212

Index 251

risk for, 24 market behavior and, 171 second-order power of, 208–210 through policy changes, 171 under SGP, 215–216 economic power dynamics of, 153 uncertainty and, 24, 207–223 ELA program, 4, 27 Economic Plan of 1993, in US, 36 EONIA, 159 economic policy. See also authority; ESTER, 159 economic markets; specific countries inflation control by, 159–163 in EU, 152–155 intervention risks and, 205 Federal Reserve role in, xiii investor risks and, 152–153, 205 Risk Intervention Curve, xiii–xiv LTROs and, 158–159, 166–169, 196 Economic Policy Uncertainty Index, 155–157 monetary aggregates, 161–162 economic technocrats, xiii MROs and, 159–166 EFSF. See European Financial Stability OMT program, 2–3, 174–175, 200–205 Facility in Germany, 201–205 EFSM. See European Financial private sector liquidity interventions, 15 Stabilization Mechanism QE and, 3–4 ELA program. See emergency liquidity REPO contracts, 159–160 assistance program SMP, 179 Emanuel, Rahm, 31 TLTROs and, 3–4, 27, 195–196 Emergency Economic Stabilization Act, US European Commission (EC), 15 (2001), 129 European Financial Stability Facility emergency liquidity assistance (ELA) (EFSF), 174, 179, 183 program European Financial Stabilization ECB and, 4, 27 Mechanism (EFSM), 174, 179, in Greece, 4, 191–194 183 sovereign debt crisis and, 174 European Stabilization Mechanism (ESM), in Ireland, 181–182, 220–221 174, 179 EONIA. See Euro Overnight Index Average European Union (EU). See also sovereign ESF. See Exchange Stabilization Fund debt crisis; specific countries ESM. See European Stabilization economic policy development in, 152–155 Mechanism intervention risk in, 3 ESTER. See Euro short-term rate investor risk in, 3 EU. See European Union private sector liquidity within, 15 Euro through EC policy changes, 15 adoption of, 156 ECB interventions for, 15 ESTER, 159 IMF policy changes, 15 HIPC and, 197–198 SGP adoption by, 169 liquidity booms, 164 Eurozone. See also sovereign debt crisis Euro Overnight Index Average (EONIA), deference levels in, 163–165 159 economic crises within, 18 Euro Plus Pact, 216 development history of, 163–165 Euro short-term rate (ESTER), 159 Economic Policy Uncertainty Index and, European Central Bank (ECB), 2–5. See 155–157 also Eurozone; Greece; sovereign under Euro Plus Pact, 216 debt crisis historical development of, 155–171 APP and, 3–4 adoption of Euro, 156 economic activism by, 4–5 SGP and, 157 during pre-crisis era, 169–171 inflation control in, 158–159, 162 economic authority of, 197–205 economic growth management and, with OMT program, 200–205 159–163 RIC and, 30 interest rates in, 162 under Treaty of Lisbon, 199–205 money supply in, 162 two pillar strategy of, 197–199 RIC and, 157–158 economic growth management by, Exchange Stabilization Fund (ESF), 159–163, 205–206 117–119

252 Index

Faircloth, Duncan McLauchlin “Lauch,” “Fiscal Cliff” and, 141 118 global economic scope of, 128 Fannie Mae, 1–2 legal acts as result of, 126–127 FDIC. See Federal Deposit Insurance market behavior during, 143 Corporation Obama and, 130 Fear: Trump in the White House political appointments during, (Woodward), xi 128–138 Federal Deposit Insurance Corporation political capacity during (FDIC), 133 interdependence with economic Federal Funds Rate, 107, 159 leaders, 130–132 Federal Reserve, US See also financial crisis limitations of, 128–138 of 2008 RIC and, 105–128 AMLF, 135 TARP as response to, 126–127 authority of, 30 Fini, Gianfranco, 185–186 congressional authority and, 116–123 “Fiscal Cliff,” 141 ESF financing and, 117–119 fixed exchange rates, 212 IMF loans and, 116–117 Flexibilization plan, in Argentina, 47 1995 budget battles, 119–123 FOMC. See Federal Reserve Open Market Plan B and, 116–119 Committee CPFF, 135 France debt ceiling crisis and, 121–123 inflation in, 165 Discount Rate, 107 SGP violations by, 167–168 economic activism by, 4–5 Freddie Mac, 1–2 economic impact of, 104–105 Friedman, Milton, 64–66 economic policy influenced by, xiii Federal Funds Rate, 107, 159 Geithner, Timothy, 31, 104, 108–149 “Fiscal Cliff” and, 141 Generalized System of Preferences (GSP), inflation and, 107 90 MMIFF, 135 Gephardt, Richard, 120 political impact of, 104–105 Germany QE programs, 104–105 inflation in, 165 RIC and, 30 liquidity booms in, 163–165 Federal Reserve Open Market Committee OMT program in, 201–205 (FOMC), 104–105 SGP violations by, 167–168 Fels, Joachim, 203–204 Treaty of Lisbon and, 199–205 Fernández, Carlos Rafael, 84, 86–87 Gingrich, Newt, 119, 121 Fernández, Roque Benjamín, 49, 59, 61, GIPSI countries. See Greece; Ireland; Italy; 64–66, 219–220 Portugal; Spain Fernández de Kirchner, Cristina, 31, 38, Giustiniani, Héctor Rúben, 83 51, 55–56, 79 Glass-Steagall Act, US, 108 consolidation of power, 96–97 Gómez Díaz, Ricardo, 76–77 economic policy under, 73, 83–89 González, Antonio Erman, 53–54, 56 Figueroa, José Armando Caro, 67 González Fraga, Javier, 88 Final Point Law, Argentina (1986), 48 González-Páramo, José Manuel, 161–193, financial crisis of 2008, 126–147 199 congressional budget battles after, 135–138 Gore, Al, 114, 117 economic analysis of, 147–151 Gore, Tipper, 111 economic deference during, 132–135 government-sponsored enterprises (GSEs), economic policymaking during, 1. See also Fannie Mae; Freddie Mac 132–135, 143 Gramm-Leach-Bliley Act, US (1999), 112 Federal Reserve response, 138–142 Great Inflation Battle, 62 intervention expectations and risks, Great War, 59–61 142–147 Greece outcomes of, 144–147 credit rating of, downgrading of, 172–173 political opposition risks, 144–146 ECB and, 4

Index 253

economic crises in, xv, 2, 100–101, 166–195 Federal Reserve response to, 107 deference in, 163–165 interest rates, in Eurozone, 162 economic bailout finalization, 189–190 International Centre for the Settlement of historical development of, 163–165 Investment Disputes (ICSID), 81, IMF loans as response to, 177–178 89 repayment of loans after, 194–195 International Monetary Fund (IMF), 15 ELA program and, 4, 191–194 in Argentina, 68, 90, 101 fixed exchange rates in, 212 economic recovery and, 74–76 inflation in, 165 sanctions against, 84 liquidity booms in, 163–165 Federal Reserve and, 116–117 PSI in, 187 Greece and, loans during economic SGP violations by, 168 crises, 177–178 Greenspan, Alan, xiii–xv, 32, 36, 72, 99, intervention risks 103, 130. See also Federal ECB and, 205 Reserve for economic markets, 210–212 Bush and, 115–116 in EU, 3 Clinton, B., and, 109, 111–112, 148–149 by Federal Reserve, 142–147 economic liberalism promoted by, during financial crisis of 2008, 142–147 218–219 investor preferences Griesa, Thomas, 91–92 RIC and, 20–23 Grinspun, Bernardo, 45, 47, 60 East Asian economic crisis and, Grobocopatel, Gustavo, 85–86 21–22 Grows, Daniel, 187 institutional constraints on, 21–23 GSEs. See government-sponsored risk management for, 28–33 enterprises uncertainty management for, 28–33 GSP. See Generalized System of Veto Player Model of, 22–23 Preferences investor risk, 145–146 Guzman, Martin, 91–92 ECB and, 152–153, 205 in EU, 3 Hall, Bruce, 6, 214 Ireland Harmonized Index of Consumer Prices debt crisis in, 180–187 (HIPC), 197–198 ELA programs for, 181–182, 220–221 Hipólito Martínez, Victor, 44 funding arrangements for, 183–184 Hollande, François, 192, 201 economic crisis in, 2 inflation in, 165 ICSID. See International Centre for the liquidity booms in, 163–165 Settlement of Investment Disputes Irwin, Neil, 32 IMF. See International Monetary Fund Italy implementation capacity debt crisis in, 180–187 of economic markets, 210, 218–220 economic crisis in, 2 predictions of economic policy and, 34–36 Job Creation Act, US (2010), 126–127 RIC and, 33 Jobs and Growth Tax Reconciliation Act, inflation US (2003), 115–116 ECB control of, 159–163 Juncker, Jean-Claude, 177–178 in Eurozone, 158–159, 162 economic growth management and, Kantor, Mickey, 110 159–163 Kicillof, Axel, 73–74, 88, 92–93 Federal Reserve as influence on, 107 King, Mervyn, 35 in France, 165 Kirchner, Néstor, 31–32, 36, 38, in Germany, 165 100 in Greece, 165 consolidation of power, 96–97 in Ireland, 165 economic policy under, 73–74 in Spain, 165 investors’ expectations under, 41 in US, 106, 124 Lavagna and, 74, 76–82, 96

254 Index

Lagarde, Christine, xiii, xvi, 96, 192, 208 Bonex Plan, 53 Latin America. See also specific countries Cavallo and, 53–54, 59, 61 “lost decade” of, 43–50 Convertibility Plan, 13, 31, 57–58, Lavagna, Roberto, xiii, 13, 32, 36, 38, 76, 83 99–100, 219–220 economic policy under, 73–74 expansion of political power, 52 institutional authority of, 76 through concentration of authority, 72 investors’ expectations under, 41 investors’ expectations under, 41 Kirchner and, 74, 76–82, 96 loss of political power, 58 Law of Due Obedience, Argentina (1987), Olivos Pact, 57–58 48 Washington Consensus and, 52–53 Lazear, Edward, 18–31 Merkel, Angela, 192, 221 lender of last resort, 29 Mexico Lenicov, Jorge Remes, 74, 76 NAFTA, 116–117 Lenihan, Brian, 180, 182–183, 220–221 Peso Crisis in, 219 Levitt, Arthur, 104, 113 Tequila Crisis, 18 Lew, Jack, 132 Miceli, Felisa, 82, 84 liability dollarization, 63 MMIFF. See Money Market Investor liberalism. See economic liberalism; Funding Facility neo-liberalism Mnuchin, Steven, 150–151 LIBOR. See London Interbank Offer Rate Money Market Investor Funding Facility Lindsay, Lawrence, 115 (MMIFF), 135 liquidity booms, throughout Europe, Monti, Mario, 32, 185–186, 188–189, 163–165. See also private sector 221 liquidity Morales, Gerardo, 83 Lock Law, Argentina (2005), 80, 86–87 Morandini, Norma Elena, 88 London Interbank Offer Rate (LIBOR), Moreno, Guillermo, 84 122 MROs. See main refinancing operations longer-term refinancing operations Mussa, Michael, 66 (LTROs), 158–159, 166–169, 196. See also targeted longer-term NAFTA. See North American Free Trade refinancing operations Agreement López Murphy, Ricardo, 76–77 Napolitano, Giorgio, 185 Lorenzino, Hernán, 72–74, 85, 89 National Credit Union Administration Lousteau, Martín, 83–84 (NCUA), 133 LTROs. See longer-term refinancing neo-liberalism, 54–59 operations net foreign investment, in Argentina, 62 Lukes, Steven, 214–218 Nixon, Richard, 31, 150–151 Noonan, Michael, 183 Machiavelli, Niccolò, 221–223 North American Free Trade Agreement Machinea, José Luis, 47, 49, 68 (NAFTA), 116–117 MacIntyre, Andrew, 8–9, 20–21, 210. See also Risk Intervention Curve Obama, Barack, 26, 31, 130, 201. See also Veto Player Model, 22 financial crisis of 2008 dynamism in, 23 Office of the Comptroller of the Currency Macri, Mauricio, 74, 93–97 (OCC), 133 main refinancing operations (MROs), Office of Thrift Supervision (OTS), 159–166 133 market risk, 24 Olivos Pact, 57–58 market uncertainty, 24 OMT program. See Outright Monetary markets. See economic markets Transactions program Martínez de Hoz, José Alfredo, 52 O’Neill, Paul, 38, 76–78, 115 Massera, Emilio Eduardo, 52 Operation Twist, 27 Mattis, James, xi oracles, predictions of economic policy by, Memory of the Fire (Duhalde), 74–75 36–37 Menem, Carlos, 31, 36, 38, 51–54, 76–77 Orszag, Peter, 31

Index 255

Ortega, Ramón, 67 deference and, 34–36, 38 OTS. See Office of Thrift Supervision implementation capacity and, 34–36 Outright Monetary Transactions (OMT) by oracles, 36–37 program shaping strategies, 34 ECB and, 2–3, 174–175, 200–205 TARP and, 37 in Germany, 201–205 private capital in economic markets, 217–218 financial interdependence and, 18 liquidity of, 17 Panetta, Leon, 110 expansion of, 17–18 Papaconstantinou, George, 172–173, 177 management of, 17–20 Papademos, Lucas, 188–189 financial interdependence factors, Papandreou, George, 177 18–19 Paulson, Henry, 18–31, 72, 104, by national governments, 18–19 108–149 RIC and, 20 bazooka theory, 1–2, 68, 162, 203 Private Sector Involvement (PSI), 187 Fannie Mae and, 1–2 private sector liquidity, 7–12 Freddie Mac and, 1–2 in Argentina, 13–14 Peirano, Miguel, 84 Austral Plan, 13, 37 Pesce, Miguel, 86 Convertibility Plan, 13, 31 Peso Crisis, 219 of capital, 17 Pignanelli, Aldo, 78–79 expansion of, 17–18 Plan B, 116–119 through cross-border banking, 17 policy risk, 24 within EU, 15 policy uncertainty, 24 through EC policy changes, 15 Policy Uncertainty Index, 144 ECB interventions, 15 political risk, 24 IMF policy changes, 15 political uncertainty, 24 generation of, 7 Pollock, Daniel, 95 through inter-bank lending, 17 populism, in Argentina, 72–98 through inter-firm lending, 17 Portugal intervention dynamics, 7–8 economic crises in, xv, 2 investor risk behaviors, changes to, 11–12 liquidity booms in, 163–165 policy uncertainty factors, 9–10 SGP violations by, 168 alterations of policy flexibility, 10 Pou, Pedro, 70 management strategies for, 10–11 Powell, Jerome, 104–105, 150 political uncertainty factors, 9–10 power management strategies for, 10–11 authority and, 8, 34–36, 76, 124–125, RIC, 8–12 214–215 reduction strategies in, 10–11 constitutive, 11, 16, 20, 28–29, 42, in US, 14–15 59–61, 72, 153, 171, 213 Federal Reserve role in, 14–15 deference and, 8, 34–36, 76, 124–125, Treasury Department role in, 14–15 171, 214–215 Prodi, Romano, 168 in highly interdependent environments, product risk, 24–25 xvi, 12, 150, 220 PSI. See Private Sector Involvement implementation capacity and, 8, 33, 76, public sector purchase programme (PSPP), 124–125, 171, 214–217 196–197 relational, 213, 220 Puerta, Ramón, 71 RIC and, 19, 28–29, 213, 223 Pugliese, Juan, 50 second-order. See also second-order Putin, Vladimir, xi power Prat-Gay, Alfonso, 79, 93–95, 97 quantitative easing (QE) program, 3–4, predictions, of economic policy, 104–105 33–38 Austral Plan and, 37 Rapanelli, Néstor, 53, 56 authority and, 34–38 Redrado, Martín, 79, 83–84, 86

256 Index

REPO contracts. See short-term repurchase of Federal Reserve, 30 contracts second-order power and, 19, 213, 223 Repsol YPF, 67–68, 90–91 sovereign debt crisis in EU and, 174 nationalization of, 88 uncertainty in. See also specific topics Republican Revolution, 119 context for, 27–28 RIC. See Risk Intervention Curve definitions of, 24–25 Rights upon Future Offers (RUFO) clauses, management of, 25–33 92 types of, 24–25 risk in US, 105, 124–125 intervention Rodríguez, Jesús, 50 in EU, 3 Rodríguez Saá, Adolfo, 71 by Federal Reserve, 142–147 Romer, Christina, 31 during financial crisis of 2008, Romero, Juan Carlos, 76–77 142–147 Rúa, Fernando de la, 66–71, 100 investor, 3, 145–146 Rubin, Robert, 36, 104, 110, 112, 130, 149, market, 24 219 policy, 24 debt ceiling crisis influenced by, 121–123 political, 24 RUFO clauses. See Rights upon Future product, 24–25 Offers clauses in RIC, 24 Russia, financial crisis in, 18 context for, 27–28 definitions of, 24–25 Sanders, Bernie, 118 management of, 25–33 Sapag, Silvia, 67 types of, 24–25 Sarkozy, Nicolas, 168, 221 specific actor, 24–25 Saxton, Jim, 118 Risk Intervention Curve (RIC), xiii–xiv, Scioli, Daniel, 76–77 20–33, 39 second-order power, 18–19, 208–210. See in Argentina, 59–60, 63–64 also power deference in, 31–33 in highly interdependent environments, in Argentina, 32–33 xvi, 12, 150, 220 dynamism in, 23–28 over markets, 8, 19, 39, 208–209 in economic markets, 210–212 RIC and, 19, 213, 223 Eurozone and, 157–158 risk and, 19, 213, 223 Federal Reserve and, 30 uncertainty and, 8 financial crisis of 2008 and, 105–128 Securities and Exchange Commission implementation capacity, 33 (SEC), 134 in inflationary environments, 28 Securities Markets Programme (SMP), investor preferences and, 20–23 174, 179 East Asian economic crisis and, 21–22 September 11, 2001 terror attacks, 114–116 institutional constraints on, 21–23 SGP. See Stability and Growth Pact risk management for, 28–33 short-term repurchase (REPO) contracts, uncertainty management for, 28–33 159–160 Veto Player Model of, 22–23 Singer, Paul, 87, 94 in lender of last resort environments, 29 SMP. See Securities Markets Programme private capital management and, 20 Snow, John, 77–78 private sector liquidity and, 8–12 Solomon, Gerald, 122–123 reduction strategies in, 10–11 Sourrouille, Juan Vital, 13, 45–48, 60–61, risk in, 24. See also specific topics 99 context for, 27–28 sovereign debt crisis, throughout EU, definitions of, 24–25 171–197. See also Greece management of, 25–33 economic growth strategies after, types of, 24–25 195–197 role of authority in, 29–30 through Asset Purchase Programs, of ECB, 30 196–197 elements of, 30 through LTROs, 196

Index 257

through TLTROs, 195–196 political chaos of, xi–xii economic policy flexibility for, 174–176 Tsakalatos, Euclid, 194 EFSF for, 174, 179, 183 Tsipras, Alexis, 192–195 EFSM for, 174, 179, 183 2008 financial crisis. See financial crisis of ELA program as result of, 174 2008 in Ireland, 181–182, 220–221 Tyson, Laura, 110 ESM for, 174, 179 historical development of, 172–175 Ubaldini, Saúl, 48 in Ireland, 180–187 uncertainty ELA programs for, 181–182, 220–221 market, 24, 207–223 funding arrangements for, 183–184 policy, 24 in Italy, 180–187 political, 24 OMT program for, 174–175 in RIC RIC and, 174 context for, 27–28 SMP for, 174, 179 definitions of, 24–25 in Spain, 180–187 management of, 25–33 Spain types of, 24–25 debt crisis in, 180–187 specific actor, 24–25 economic crisis in, 2 United Nations Commission on inflation in, 165 International Trade Law liquidity booms in, 163–165 (UNCITRAL), 89 specific actor risk, 24–25 United States (US). See also Federal specific actor uncertainty, 24–25 Reserve; financial crisis of 2008; Spring Plan, in Argentina, 49 Washington Consensus Stability and Growth Pact (SGP), 157, American Recovery and Reinvestment 167–168 Act, 126–127 economic markets under, 215–216 CFTC, 112–113 EU adoption of, 169 check and balances between government stagflation, 106–107 branches, xii–xiii Stark, Jürgen, 186–187, 200, 217 Commodity Futures Modernization Act, State Reform Law, in Argentina, 51 108, 112, 219 Stiglitz, Joseph, 91–92 competitiveness concerns in, 106, 124 Summers, Larry, 104, 108–149, 219 Contract with America Advancement systemic risk. See market risk Act, 123 debt costs in, 110 targeted longer-term refinancing operations deference in economic policy, 105–125 (TLTROs), 3–4, 27, 158–159, deregulation authority in, 105–125 195–196 Dodd-Frank Wall Street Reform and TARP. See Troubled Asset Relief Program Consumer Protection Act, 126–127 Tax Relief, Unemployment and Insurance economic crises in, 18 Reauthorization and Job Creation Economic Growth and Tax Relief Act, US (2010), 126–127 Reconciliation Act, 114–115 Tequila Crisis, 18 Economic Plan of 1993, 36 Terragno, Rodolfo, 49 Emergency Economic Stabilization Act, TLTROs. See targeted longer-term 129 refinancing operations financial crisis in, 18. See also financial Treaty of Lisbon, 199–205 crisis of 2008 Trichet, Jean-Claude, xiii, xv, 152, 162, Glass-Steagall Act, 108 182–185, 198–199, 220–221. Gramm-Leach-Bliley Act, 112 See also European Central Bank Great Moderation in, 106 Troubled Asset Relief Program (TARP), inflation in, 106, 124 37, 126–127, 129, 212–213 Job Creation Act, 126–127 Trump, Donald, 31 Jobs and Growth Tax Reconciliation Act, presidency of 115–116 information leaks about, xii NAFTA, 116–117

258 Index

United States (US). (cont.) Veigel, Klaus, 50 Operation Twist, 27 Veto Player Model, of investor preferences, 22 political capacity in, of economic policy, dynamism in, 23 105–125 Videla, Jorge Rafael, 52 private sector liquidity in, 14–15 Vido, Julio de, 82, 88 Federal Reserve role in, 14–15 Viola, Roberto, 52 Treasury Department role in, Volcker, Paul, xiv, 106–107. See also 14–15 Federal Reserve RIC in, 105, 124–125 SEC, 134 Wall Street Journal,87 September 11, 2001 terror attacks, Washington Consensus 114–116 Argentina and, 40 stagﬂation in, 106–107 during Menem presidency, 52–53 TARP, 37, 126–127, 129, 212–213 Weber, Axel, 179, 217 Tax Relief, Unemployment and Weidmann, Jens, 200–201 Insurance Reauthorization and Job White Knights, 66–71 Creation Act, 126–127 Wolin, Neal, 136–137 US Treasury. See Federal Reserve; ﬁnancial Woodward, Bob, xi–xii crisis of 2008 Yellen, Janet, xiii, 104, 141, 149–150 Van Rompuy, Herman, 175–176 Varoufakis, Yanis, 192, 194 Zapatero, José Luis Rodríguez, 184