Analysis

04/24/2013

Earlier this week, we asked readers, What austerity measures likely will be most effective in achieving sovereign financial recovery? Some 35% responded, "None -- austerity is doing more harm than good." About 65% of respondents believe that austerity is necessary. This view is strongly in accord with the northern European nations -- including Germany, the Netherlands, Finland, and the United Kingdom -- which continue to advocate for austerity in handling Europe's economic and debt woes. However, support for such measures is beginning to attract some notable critics, including European Commission President José Manuel Barroso and more neutral parties, such as the International Monetary Fund and Bill Gross of PIMCO, the world's largest bond fund manager. Gross reminded Europe that to engender economic growth, it needed to spend money. I think all respondents would agree that there are no easy solutions to sovereign financial recovery. -- Jason A. Voss, CFA, Content Director, CFA Institute

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