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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Just a year after wealthier European governments rescued Athens from default with $157 billion in loans, Greece is slipping into crisis again.

After seeing its credit rating sharply downgraded on Monday, and unable to meet deficit-reduction targets laid down by Germany and others, Greece is getting desperate–and Europe is getting anxious.

Officials are floating euphemistic phrases like “voluntary restructuring,” but make no mistake: The painful concessions Greece would probably require from creditors amount to a default. If that happens, the broader European economy will be on its knees, its credibility shattered. So what should Greece do?

The only real solutions are for Greece and other low-income countries to abandon the euro and for Europe as a whole to rethink its welfare state.

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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Gold is selling for close to $1,500 an ounce, up from $258 in 2001.

Jewelry and industrial applications absorb at least 80% of new supply. The economic expansion of the 2000s and the recent recovery have boosted commercial demand, but this alone cannot explain the persistent surge in gold prices.

The cost of bringing new deposits on line has been less than the market price of recent years–investors see in gold what they cannot find in interest-bearing securities.

Exchange traded funds (ETFs) have made storing wealth in gold or simply speculating easier. These store bullion for investors who have lost confidence in the dollar, euro and yen, and may be a precursor of a new gold standard.

In 1944, the International Monetary Fund established a system of fixed currency exchange rates. The dollar was fixed to gold and other currencies fixed to the dollar. This system failed because rising production costs pushed the industrial price of gold above its monetary value, and fixed exchange rates among currencies proved unsustainable.

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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Friday, the U.S. Labor Department reported consumer prices were up 0.5% in March, driven by 3.5% and 0.8% jumps in energy and food prices.

This is the fourth straight month of large gains in consumer prices. While food and energy prices may be volatile, international conditions indicate commodity prices will continue surging, and the Fed’s emphasis on core inflation is absolutely misplaced.

With inflation running at 6% a year, it will be tough for the Federal Reserve to deny inflation and continue quantitative easing and low interest rates generally. Similarly, with unemployment likely to remain above 8% for the balance of the year, the Fed will find it tough to raise interest rates too much.

The U.S. economy is headed for stagflation thanks to failed banking and international economic policies that lie largely beyond the Fed’s control.

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   By Bradley Davis
   A DOW JONES NEWSWIRES COLUMN 

NEW YORK (Dow Jones)–With the euro marching higher since hitting last week its lowest level since 2006, some investors wonder whether the common currency has put its worst days behind it.

Don’t bet on it, most say.

The common currency posted strong gains Tuesday, advancing around 1% on the dollar, even as euro-zone data sharply missed expectations and yields of government bonds tied to some fiscally stressed countries ticked higher.

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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Greece is insolvent. No austerity or new taxes will pay its debts.

Like a homeowner owing four times income, belt tightening and a longer repayment period are not enough. Either, the house is sold to clear the debt or the bank takes back the house.

Greek bondholders don’t have that choice–they can’t repossess the Parthenon.

Greece is a sovereign country, and either it will be the recipient of endless German largess–an unlikely scenario–or European creditors, banks among them, will take a loss.

Now, the International Monetary Fund bluntly warns Spain, to avoid becoming the next Greece, that it must radically overhaul labor laws, pensions and consolidate banks–that’s tough for a sovereign that doesn’t print money in the midst of a market panic.

Germany and European banks can’t take that hit.

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These are the personal views of David Gilmore, partner at Foreign Exchange Analytics:

For some in the market the Greek debt crisis has always been about the European banking system…collateralized by “risk-free” sovereign paper from some less than “risk-free” sovereign credits. Tons of debt issued by Greece, Spain, Portugal (not too different from AAA rates subprime MBS) and yes Italy support the banking system in the Euro Zone as collateral for borrowing from the ECB and from other banks, as well as a place to capture yield. Well when markets discern that “risk-free” sovereign debt is not really “risk-free” the inevitable run on weak credits starts. And like the subprime-driven run on banks in 2008, officials only add to downside risk as they assume the problem is contained.

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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Whoever is declared the winner, the outcome of the Massachusetts senatorial election is neither a mandate for President Obama’s liberal agenda nor a license for a return to status quo ante of George Bush.

The fact that a conservative put Ted Kennedy’s seat at play is a repudiation of Democrats recent partisan governing style, and an agenda that is simply out of step with the real change Americans want.

From health care to jobs to the banks, it’s time for Democrats to stop accusing critics of deceiving the public and to step back ask what voters will accept. Continue reading…