contagion

Now that Italian bonds are getting crushed and contagion is clearly spreading to the core, Greece will have to be cut loose.

Andy Lees argues insufficient dollars are getting into the system from the US current account deficit to finance the growth in global trade, so the stock of these international dollars is falling relative to the value of world trade. He…

Most analysts agree that Greece is insolvent. This column argues that the issue is whether Greece’s troubles are contagious.

We have been closely monitoring the firewall that has appeared to protect Spain from the other Portugal (Ireland and Greece). Recent developments appear to be weakening that firewall and pressure is mounting on Italy now as well. It is…

Dollar is broadly firmer for the second day on euro zone periphery issues; China hikes rates by 25bp. Safe havens are bid again as downgrade of Portugal fuels concerns over status of Ireland’s rating. Brazil Finance Minister Mantega…

Now obviously, there are the issues of efficiency and fairness to think about. However, I want to look at this from a pure forecasting perspective. and stick to the tack I began in October 2010 with “Less Policy Advocacy and More Policy…

I want to take a look at the latest news concerning the Greek situation using the political framework I laid out earlier in the month.On the whole, things are proceeding pretty much as anticipated.

There has been a net withdrawal from US money market funds and it appears that the funds have moved to strictly US Treasury or US high grade money market funds. Banks appear to be responding by hedging/securing funding through yen swaps. In…

Greece is now getting a second bailout and the Greek government is attempting to get the austerity measures upon which the bailout is conditioned passed through its legislature. I think largely the same issues still apply as in May.…

The fact that this withdrawal of liquidity has already begun, though, does make the situation more acute. The question is what to do about it. It seems to me that the present path is not instilling a sense of confidence in investors.