As a second wave of the Covid-19 pandemic is taking hold of Europe, the European Union, with its high welfare and healthcare standards, seems to be able to withstand it better than the US.
But if in terms of public health this may be true, in economic terms EU politicians and policymakers should use this once-in-a-lifetime opportunity to understand that the EU risks falling behind the US and China — and to take measures to prevent that.
Of all the fears sweeping the markets right now, perhaps the most worrying is the fear of a debt crisis in the corporate sector.
Warnings about corporate debt rising to unsustainable levels are intensifying, at a time when interest rates are at record lows and even Greece joined the club of negative-yield sovereign debt issuers.
OK, let’s set Greece to the side for the moment and turn our attention to second-quarter and first-half earnings. The reporting season kicks off towards the end of this month, and analysts say there may be some nice surprises in Europe.