Tony Yates's picture
Affiliation: 
University of Birmingham
Credentials: 
Professor of Economics

Voting history

Market Turbulence and Growth Prospects

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Question 1: Do you agree that economic growth prospects for the global economy have seriously deteriorated?

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Answer:
Disagree
Confidence level:
Not confident
Comment:
I would say that they have deteriorated somewhat, but not 'seriously'. It remains to be seen whether the stock market correction goes any further, or starts to affect credit risk and therefore financial intermediation.

Deal or no deal: The Greece standoff

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Question 3: Do you agree that implementation of the agreement will lead to an expected decrease in Greek debt repayments?

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Answer:
Disagree
Confidence level:
Not confident
Comment:
Again there is the question of what the counterfactual is. Relative to default, surely more debt will be paid back. However, I doubt much of the debt will be paid back even in the 'no default' option. A no default deal will be followed by a restructuring and write down, and the NPV of the debt, which is already low, will fall further.

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Question 2: Do you agree that Greece would be better off defaulting right now rather than signing to the agreement under consideration?

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Answer:
Disagree
Confidence level:
Not confident
Comment:
No. Neither option is particularly attractive, but default has some very large downsides, including social collapse, exit from eurozone and even EU. I would guess that if Greece survives the non default option a favourable renegotiation could be had later, particularly if Greece gave ground on structural reforms.

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Question 1:  

Do you agree that, on balance, the implementation of the agreement as outlined in media reports will have a non-trivial negative effect on Greek GDP?

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Answer:
Neither agree nor disagree
Confidence level:
Not confident
Comment:
It depends what the counterfactual is. Relative to no deal, and default, this will have a positive effect on GDP for a few years at least, as I would forecast that the few years of autarky and financial collapse would be very painful. Relative to a situation where fiscal instruments were on their current settings, yet there was no default, it would have a negative effect.

Monetary policy and the zero lower bound (ZLB)

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Question 1: Do you agree that it is feasible for the UK authorities to change the monetary system so that materially negative policy interest rates could be safely implemented? (In answering, you may wish to explain your reasons and define your view of 'material')

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Answer:
Agree
Confidence level:
Confident
Comment:
I agree it's feasible. We know what to do and how to do it. I'm less confident that it can be done 'safely' as I explain in my answers to the next question.

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