fiscal

A look at the fundamentals shows why Fernandez is engaging in such visible theatrics, which also includes recent vitriol regarding the Falkland Islands. Simply put, we think economic stresses are intensifying. How deep the stresses will get…

The French premium over Germany rose today to a three-month high. Rumors of a rating downgrade proved wide of the mark, but it reflects the market's anxiety about the outlook for France going forward.

The rump Dexia now owned by the Belgian government is a structurally loss-making enterprise that will cost the Belgian government 2 billion in deficits every year from 2014.

The following is a March 1932 speech by then US President Herbert Hoover about the growing US deficit. As I indicated in previous posts on Hoover's travails, the President earnestly wanted to balance the budget (see Herbert Hoover: White…

The more Spanish officials talk about the budget the less credible it seems. The 10-year yield fell 11 bp on Friday when the budget first presented before the weekend. Now as more detail emerge as it goes to parliament, 10-year yields are…

Banks, households and the government sector are all engaged in deleveraging. It is difficult to see where aggregate demand will come from. Spanish exports in January were up about 4% from a year ago, but the pace appears to be leveling off.…

I have a number of links coming up in today's daily commentary. The likely topic will be US interest rates. But there is a second topic I wanted to riff on so I am posting here separately about fiscal woes in Spain and the Netherlands.

A growing number of indicators suggest that the market is running out of steam. Equities have been in a temporary sweet spot where investors have been factoring in a self-sustaining U.S. economic recovery while also anticipating the…

One of our thematic points for Q2 is the increased importance of political factors for the investment climate. Dutch developments are consistent with this and the risk that the government collapses is rising.

Back in November last year I posted on my confusion over the jubilation shown by the citizens of Spain as they elected Mariano Rajoy as their new political leader. Mr Rajoy’s strategy during the election campaign was to say very little…