Edward Conard

Top Ten New York Times Bestselling Author

  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
Upside of Inequality Oxford Unintended Consequences

AI Summary. A rapid rise in long-term US Treasury yields has highlighted vulnerabilities elsewhere, notably France, where risks are elevated. Because France is in the euro zone, any crisis there would extend to the currency area, and European stocks have sold off alongside a weakening euro.

John Authers Bloomberg
Date Posted:

The spread between 10-year French OATs and German Bunds is pricing a second eurozone sovereign-debt crisis. Authers suggests that the recent surge in US long-term yields has “shone a light” on France’s fiscal weakness, raising its salience to investors.

Do rising US long-term yields expose vulnerabilities in Europe?

Core argument: The speed of the rise in US long-term Treasury yields has raised the risk of dislocations elsewhere, with France a point of elevated vulnerability that would extend to the rest of the euro zone.

The speed of [the upward move in US long yields] brought the risk of dislocations elsewhere, like in France. Much as a surprising hawkish shift from the Fed under Alan Greenspan in 1994 revealed underlying weaknesses in the Mexican financial system that led to the Tequila Crisis, so this Treasury scare has shone a light on where the world’s greatest vulnerabilities are to be found. As France is part of the euro zone, any crisis must naturally extend to the rest of the currency area, at a time when most of its members are moving in a nationalist direction and likely reluctant to help. That is beginning to have an impact on stocks. The main European bourses sold off even as US equities rallied on Thursday. In combination with a weakening euro, the continent’s stocks have now given up almost all their gains since Trump took office.

Takeaways by Macro Roundup® AI

  1. The speed of the rise in US long-term Treasury yields has raised the risk of dislocations elsewhere, with France a point of elevated vulnerability that would extend to the rest of the euro zone.
  2. The Treasury scare echoes the Fed’s surprising hawkish shift under Alan Greenspan in 1994, which revealed weaknesses in Mexico’s financial system and led to the Tequila Crisis.
  3. Europe’s main bourses sold off even as US equities rallied, and combined with a weakening euro, the continent’s stocks have given up almost all their gains since Trump took office.

Related Articles:

  • France Seeks To Rein In Pensions And State Salaries In 2027 — France plans to narrow its budget deficit to 5% of GDP by cutting state spending, capping increases to pensions and civil servant salaries, and raising taxes. Deteriorating public finances have left France borrowing at higher interest rates than Italy and Greece, with 10-year bond yields reaching their highest since 2002.
  • Soaring Bond Yields, Gaping Deficits and Towering Debts: What Could Go Wrong? — An analysis of 22 rich countries estimates that if each refinanced its entire debt at current five-year bond yields, Britain would need the largest primary surplus to stabilize its debt-to-GDP ratio, about 1.5%, followed by Italy at 1.4%, France at 1.2% and America at 1%.
  • Global Debt Report 2026 — Gross central government borrowing across OECD countries rose 7% to a record $17tn, about 23% of GDP, and is projected to reach roughly $18tn, or 24% of GDP. The United States and Japan account for close to 80% of the area's refinancing requirements, with the US share rising from 57% to 70%.
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