Of the downside risks highlighted, the prediction of a weak Japan materialised, with people coming to talk about the 1990s and 2000s as the country's "lost decades".
Recent indicators point towards faster growth in output and a pick-up in domestic demand as well as a decline in inflation to single digits".
The argument is that a system of pegged currencies, in which the periphery export capital to the core that provides a financial intermediary role is both stable and desirable, although this notion is controversial.
[12] He argued that Spanish youth unemployment was not due to austerity and instead could be solved by "changing trade union laws" as they were keeping labour markets closed.
[13] In December 2013, Folkerts-Landau advocated the ECB engage in "genuine quantitative easing" given that he predicted growth in the euro zone to be low "pretty much as far as the eye can see,".
In September 2014, Folkerts-Landau also wrote a critical analysis of the prospects of Scottish independence, saying a Yes vote would go down in history as "a political and economic mistake" which was indirectly quoted by former Labour prime minister Gordon Brown.
(…) [T]here is no way the political and financial leadership of the core Euro-zone countries are going to sacrifice the whole single currency project over a default by Greece or Portugal".
[20] On 19 June 2015, Folkerts-Landau predicted that in relation to Greece receiving funding from the Brussels group before the end of the month there was a "60 percent probability of no deal , [which would be] followed by capital controls".
[21] After the "No" vote at the 5 July 2015 referendum, while recognising that odds of Grexit had risen materially, Folkerts-Landau wrote: "we continue to see Greece staying in the euro as marginally more likely, not least because the majority of Greeks prefer so".
He said that "In developing countries where often up to 90% of the income must be spent on food, price increases of wheat, corn, and soybeans in the years 2007–2008 and 2010–2011 had devastating consequences."
"[23] However, in earlier research published by his team, it argued that speculation had the possibility of "distorting the normal functioning of the market," which "can have grave consequences for farmers and consumers and is in principle unacceptable.".
Folkerts-Landau was not named in any of the actions, but a fellow group executive committee member was mentioned as having been aware of issues around the fix since October 28, 2008.
[27] On June 12, 2015, a leaked Bafin report concluded that while no board member was directly involved in manipulating interest rates, the regulator found serious negligence in control of business processes, organization and dealing with the affair.