At the #EconomicPolicy panel meeting Roberto Perotti revisits the debate about Eurozone target balances and confirms that a default of target balances would be a real loss to the creditors, in particular Germany: 
He suggests Target balances should be settled with a ‚break up proof‘ asset. Question what that should realistically be. Other issue is whether Target balances matter if there is no Euro breakup. Yes if breakup scenario matters for outcome of continuation bargaining.
In the debate over the last years some people claimed Target balances were not relevant. Roberto Perotti‘s paper argues they are wrong: economic-policy.org/76th-economic-…
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