There isn’t a proper policy response for every need.
That is from Bob Samuelson. His stance on monetary policy is not mine, but still these are neglected words.
I also see just how much economists are doing macroeconomic analysis without using the concept of trust. Following yesterday’s elections, including in France, trust among the eurozone nations went down. That makes the chance of a good outcome less likely, not more likely. It is painful to admit this, but things still could get much worse and now they are likely to do so. A seventeen-member currency zone (scary just to type those words) has to be based on trust and this one isn’t, least of all now. There is little reason to think that Hollande can browbeat the Germans into picking up more of the bill, and if the Germans perceive their former French partner as an unreliable ally, this becomes all the less likely .