Europe's fundamental problems remain unresolved
Europe's fundamental
problems remain unresolved: low potential growth; high unemployment;
still-high and rising levels of public debt; loss of competitiveness and
slow reduction of unit labor costs (which a strong euro does not help);
and extremely tight credit rationing, owing to banks' ongoing
de-leveraging.
Meanwhile, progress
toward a banking union will be slow, while no steps will be taken toward
establishing a fiscal union, even as austerity fatigue and political
risks in the euro-zone's periphery grow.
Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics