Are Markets Correctly Pricing In Political Risk?

The video discusses the pricing of political risk in Europe, particularly in relation to the euro-dollar exchange rate and the impact of US fiscal stimulus. It highlights the challenges in predicting political outcomes in Europe, such as the Italian referendum and French elections, and their effects on markets. The discussion also covers the transition from monetary to fiscal policy, the role of central banks, and the potential for increased market volatility as central banks reduce their asset purchases.

How has the recent fiscal stimulus in the US affected the foreign exchange markets?

What factors are influencing the pricing of political risk in Europe?

What are the implications of the Italian referendum on political risk in the eurozone?

Discuss the challenges of gauging political sentiment in Europe based on polling data.

What is the significance of structural reform for the future of the euro and Europe?