2011

If a central bank guarantees investors credibly that they can invest in certain debt instruments and not suffer principal or interest repayment risk, but only currency and inflation risk, some investors are almost definitely going to buy…

Roubini On Internal Devaluation - NYTimes.com The international experience of “internal devaluations” is mostly one of failure. tags: deflation austerity Europe Canucks Anonymous: Fixing what's wrong…

Yesterday I was on RT with Demetri Kofinas (@CoveringDelta) talking about the future of the euro zone. Lauren Lyster asked us where this was headed and we both agreed that it really was all about Italy. I just posted on why questioning…

Last week we witnessed a flight to quality within the euro zone government bond market. The yield on 10-year German government bonds dropped a record 35 points last week. They now yield 1.82 percent. Meanwhile, the yield on 10-year Italian…

BBC News - Greeks will have 'Bulgarian salary with London prices' Greece's 340 billion euro debt has led to huge austerity cuts which have dramatically impacted the standard of living in the country. Ilia Iatrou, a…

Now it's on to a Greek coalition government with the FinMin at the helm. Get ready for more austerity!!

So what is the trade? If Italy continues to blow out and a big bazooka EFSF bailout fund is not attainable, the EU will be faced with certain death or massive ECB bond purchases. We think they will choose the later, which makes the Euro a…

Switzerland reports its October consumer prices on Monday. This could be important. The Swiss National Bank's decision to cap the franc took place on the same day that the August CPI was reported (Sept 6). It showed a 0.3%…

Events continue to spiral beyond the control of European policy-makers. With so much time and effort being put into Greece, the troika now finds itself facing a much bigger problem: Italy. While it has been difficult to remain committed…

Here’s an interpretation of the euro zone I have been meaning to run by you and I touched on it in the update to my post on how austerity in Europe works. In a fixed exchange rate environment like the euro area, you don’t have currency…