In the spirit of unity, let me start with a statement we can all agree on: the EU needs to grow its capital markets. That statement begs at least two big questions. On these, there is less agreement. Firstly, how should we grow them? And secondly, why haven’t they grown more already? A lot of […]
If you invested one dollar in the post-war years in a diversified portfolio of all publicly traded firms, by 1980 you would have seen a real return of zero. Instead, if you invested one dollar in 1980, today you would have nearly ten dollars. This column argues that the rise of stock market valuations is […]
Why don’t more households participate in the stock market? The two reasons often cited in the literature are risk aversion and frictions that prevent participation, such as the cost of maintaining a brokerage account or of paying attention to the markets. This column exploits firms switching their default asset allocation from a money market fund […]
The ECB’s Governing Council moved to the preparation phase of the digital euro in October 2023. This column studies the implications of the digital euro for financial stability. New survey data indicate that German households are open to the digital euro. However, the demand for digital euro also raises financial stability concerns as households seem […]
