Francis Coppola

The fallout from Britain’s historic decision to leave the European Union continues. Domestically, there are regrets, recriminations and accusations. Young people,particularly those aged 16-17 who did not have a vote, complain that the vote did not take their interests into account  A petition for a second referendum reached over 3m votes in a few days, although it was subsequently found to have been hacked: the true number is uncertain. The media have spent the weekend tracking down...

I have reluctantly decided that there will be no more posts on Coppola Comment until after the referendum.Since I have declared my support for Remain, anything I write about the UK and the EU is now inevitably seen as biased, and anything I write about any other subject is - equally inevitably - seen as avoiding the issue. I cannot, for example, write a balanced analysis of the likely effects on financial services of a vote in either direction, though that is my specialism. Nor can I...

  "The EU's greatest achievement is the Euro", said Michael Portillo on the BBC's This Week programme last Thursday.No, Michael, it isn't. It is the EU's worst mistake.As Yanis Varoufakis entertainingly explains in an interesting lecture published in the Australian Journal of Political Economy, the creation of the Euro led inexorably to the buildup of unsustainable debt - both private and public - in the Eurozone periphery countries: The problem is that creating a monetary union is a...

Should Greece leave the Euro? That was the title of the Oxford debate at the Prague Summit in which I had the pleasure of participating yesterday.But this is the wrong question. Unless there is a considerable shift in Eurozone politics, Greece WILL leave the Euro - eventually. The question is when, and how.To see this, we need to look at the motivations of all the players involved in the negotiations. The Greek negotiations resemble a "prisoner's dilemma", in which the best outcome for...

The chart below comes from Silver Watch on Twitter. I haven't been able to identify the original source, but it illustrates perfectly the point I have been trying to make for quite some time now. Pension funds are not taking on more risky investments because the risk premium has fallen, but because the risk-free rate has fallen: In fact, as the chart shows, the risk-free rate has been falling steadily for over thirty years.  This is not a post-crisis blip. It is a secular trend. Yet pension...

In a new paper*, Michael Woodford has reimagined the famous “Schroedinger’s Cat” thought experiment. I suspect this is unintentional. But that’s what happens when, in an understandable quest for simplicity, you create binary decisions in a complex probability-based structure.Schroedinger imagined a cat locked in a box in which there is a phial of poison. The probability of the cat being dead when the box is opened is less than 100% (since some cats are tough). So if p is the probability of...

The Eurogroup (part of which is pictured above) has produced a statement on the outcome of the latest debt talks with Greece. As ever with Eurogroup statements, it confuses more than it enlightens. So here is my attempt at translating Eurogroup-speak into plain English. __________________________________________________________________________________ The Eurogroup welcomes that a full staff-level agreement has been reached between Greece and the institutions.  Phew. We got that through...

Notes from a talk given at Trinity Business School, Dublin, on 26th May 20164 Well, it depends what sort of crisis you mean. Have we done enough to prevent a crisis like the last one? Yes. We have scared ourselves so much about the dangers of disorderly bank failure that no way are we going to allow that to happen again – at least, not until we who lived through the crisis, and our children and grandchildren whom we tell about the crisis, are long gone and our legacy forgotten. No-one...

It's not going to come from people working more. Excerpt from the IMF's latest Debt Sustainability Analysis for Greece, just released: Oh dear. Quite apart from the negative contribution to growth, the prospect of unemployment taking 44 years to return to something approaching normality is simply appalling for Greece's population. I've looked in more detail at this here (Forbes).Well, if labour isn't going to drive growth, there's always investment, yes?Er, not really. The outlook for...

"Best diss of the Quantity Theory of Money comes from Keynes", commented Toby Nangle on Twitter, referring to this paragraph from Keynes's Open Letter to Roosevelt (Toby's emphasis): The other set of fallacies, of which I fear the influence, arises out of a crude economic doctrine commonly known as the Quantity Theory of Money. Rising output and rising incomes will suffer a set-back sooner or later if the quantity of money is rigidly fixed. Some people seem to infer from this that output...