We find nonlinear feedback between the stock market and certain macroeconomic factors. This evidence calls into question the adequacy of these factors as a basis for a linear pricing model. It also means that the interaction between the economy and the stock market is more complicated than given...

We examine the relationship between investment and saving for a cross section of European countries before and during the euro crisis. Investment is positively and significantly related to saving, and this relationship is stronger during the euro crisis period. This increase is a departure from...