David Smith's picture
Affiliation: 
Sunday Times
Credentials: 
Economics editor

Voting history

Global risks from rising debt and asset prices

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Question 2: Is the loose monetary policy of major central banks responsible for the recent increase in global leverage or asset values?

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Answer:
Strongly agree
Confidence level:
Very confident
Comment:
It is hard to separate rising debt and inflated asset prices from the years of loose monetary policy. The question is how markets respond to the tightening of policy, and whether that response constrains central banks.

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Question 1: Does the world economy face heightened risks arising from an excess of public and private debt and/or inflated asset prices?

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Answer:
Agree
Confidence level:
Confident
Comment:
Asset markets appear to have been divorced from underlying economic realities for some time, so there are plainly risks. They are not on the scale of 2007-8 but are a source of concern.

Juncker's State of the Union Address

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Question 2: Do you agree that the euro has had more benefits than costs?

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Answer:
Disagree
Confidence level:
Very confident
Comment:
The euro has come through the crisis but it was touch and go and only happened because of an exceptional degree of official support. It was responsible for a second recession for Eurozone economies between 2011 and 2013, after the big recession in 2008-9. Its design remains flawed and membership has hurt some economies badly.

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Question 1; Do you agree that euro membership should be compulsory for all EU member states?

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Answer:
Strongly disagree
Confidence level:
Very confident
Comment:
The EU is in danger of repeating some of the errors that led to the Eurozone crisis, in particular wit the emphasis on widening the Eurozone rather than confining it to economies that have enough convergence. Making euro membership compulsory for all EU members would be a mistake.

Wages and economic recoveries

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Question 2: Do you agree that the different behaviour of UK real wages relative to Eurozone wages during the Great Recession is in large part due to the UK having different labour market policies?

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Answer:
Agree
Confidence level:
Confident
Comment:
The different behaviour of UK wages during and after the Great Recession partly reflects past policy, and the increased flexibility of the UK labour market. But wage behaviour was weaker than expected even in the light of those past policies. It may be that people were shocked into a change in wage behaviour but something fundamental changed, for reasons that are not entirely clear.

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