Chart of the day: Italian bonds back over 6%
This chart shows how the Italians have suffered in the sovereign debt crisis. It is as if the ECB never bought bonds.
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Browsing Tag
liquidity
Mario Draghi: Fears of Italian debt spiral
One should fear an Italian debt spiral, yes. However, fiscal consolidation is an anti-growth policy that leads to higher deficits in the short-to-medium term. So what Draghi is saying doesn’t make a lot of sense.
Is Europe Sliding Into a Double-Dip Recession?
The answer is it depends who you ask. The New York Times put the question to five of us and our answers varied considerably. If there was any overlap in answers I would say it was our general agreement that the euro zone periphery will…
In which Jim O’Neill says muddling through leads to deepening crisis
Muddling through means deepening crisis for the euro zone.
IMF: Europe Risks Sovereign Debt and Bank Meltdown
This video is explosive. Dr. Robert Shapiro, an advisor to the International Monetary Fund, is saying in no uncertain terms that the dithering approach that Europe has taken will lead to crisis in a very short period, two to three weeks.…
Europe’s Bank Problem
Another informative chart from the IMF showing the fundamental problem in Europe’s banking system - excessive leverage and dependence on wholesale funding. Add to that overexposure to highly indebted sovereigns with deteriorating credit…
Felix Zulauf: expect more market turmoil than in 2008
In an interview from late September, Zulauf tells James Turk that he is very much a eurosceptic. The external imbalances in the euro zone make the euro an untenable currency union. Like David Blanchflower, Zulauf remarks how markets are…
More on the S&P bear market and the central bank liquidity train
Just a few moments ago I posted on the fact that the US is officially in bear market territory. On Twitter, I said that “in Fall 2008, 10-year yields went to extreme lows and then the liquidity train went into overdrive. Stocks rallied,…
Core Europe Sitting Pretty in their PIIGS Drawn Chariot
The “solution” currently on offer – i.e. the talk surrounding the European Financial Stability Fund (EFSF) now includes suggestions of ECB backing. This makes eminent sense. Let’s be honest: the EFSF is a political fig-leaf. If 440…
ECB: despite talk of rate cuts, the focus is liquidity
ECB member Mersh called the speculation over a 50 bp cut "wild", according to news accounts. However, given the dismal flash PMI readings and its correlation with GDP, the market is aware that the ECB can indeed cut rates next week, even…