Markets

The Biggest Reason Everyone’s Still Underestimating The ECB

The European Central Bank has been at the centre of efforts to relieve the pressure of the eurozone crisis, cutting interest rates and introducing two crucial measures to boost liquidity in the banking sector. These actions have brought sovereign borrowing costs down sharply, particularly for Italy, Spain, Austria, and France.
The Biggest Reason Everyone’s Still Underestimating The ECB
Markets

The Impact Of The ‘Mario Brothers’

They are not really brothers, but Mario Draghi and Mario Monti are countrymen and are doing a great deal to respond to the European debt crisis in ways that were unimaginable until very recently.
The Impact Of The ‘Mario Brothers’
Markets

The ECB Is Already Engaging In Massive QE

So the ratings agencies have finally followed through on the big threat and downgraded a number of the eurozone’s credit ratings, including France and Austria, both of which have now lost their coveted Triple AAA status. Italy, Portugal and Spain were downgraded a further two notches.
The ECB Is Already Engaging In Massive QE
Markets

What Alexander Hamilton Would Do To Save The Euro

[credit provider=”Simone Foxman for Business Insider with Bob With on Flickr and AP/Markus Schreiber” url=”http://www.flickr.com/photos/figgenhoffer/2393675800/”] Economists—notably Nobel laureate Thomas Sargent—and the news media have drawn comparisons between the troubled eurozone today and the United States assuming states’ debts in the 1790s.But really, writes former advisor to the Fed Chairman at […]
What Alexander Hamilton Would Do To Save The Euro
Markets

Goldman’s Jim O’Neill: Europe Needs Growth, Not Austerity, And The ECB Needs To Step Up

[credit provider=”Flickr” url=”http://www.flickr.com/photos/forumspbcom/4773911566/sizes/m/in/photostream/”] By now, everyone knows that S&P downgraded 9 eurozone countries on Friday, including France and Austria who were stripped of their coveted AAA ratings.  But many, like Goldman Sachs Asset Management Chairman Jim O’Neill, have noted that everyone saw this coming.From O’Neill’s latest Viewpoints From The Chairman […]
Goldman’s Jim O’Neill: Europe Needs Growth, Not Austerity, And The ECB Needs To Step Up
Markets

EU Takes Tough Approach On Fiscal Miscreants

Based on reports from journalists who have seen a copy of a draft of Europe’s budget-stability treaty, it appears that the compact may be tougher and more binding on its signatories than previously thought. According to Bloomberg, a country faces sanctions if it fails to reduce its public debt/GDP by […]
EU Takes Tough Approach On Fiscal Miscreants
Markets

Euro Slides Ahead of BOE and ECB Meetings

The euro was recovering in early Europe, moving back toward the upper end of its recent narrow range and it reversed course sharply, triggering stops along the way as it dropped nearly a cent to $1.2695.  The technical failure yesterday at $1.2820 may also have been more telling.  Despite the […]
Markets

10 Things You Need To Know This Morning

[credit provider=”Ian Gavan/Getty Images”] Good morning. Here’s what you need to know. Overnight trading in Asia was markedly higher, with the Shanghai SE Composite up 2.7% and Indian Sensex up 2.2%. Europe is sharply positive, while U.S. futures look to extend those gains. China’s trade surplus grew to $16.5 billion […]
10 Things You Need To Know This Morning
Markets

ECONOMIST: Screw Treaty Change, This Is How The ECB Can Fix Europe Tomorrow

[credit provider=”www.planetofsuccess.com via photosteve101 on Flickr” url=”http://www.planetofsuccess.com/”] The European Central Bank can actually solve the governance problems that got Europeans into this mess virtually immediately and without treaty change, Geneva-based economist Charles Wyplosz writes in a column out this morning on Wall Street Pit.In fact, the whole idea that EU […]
ECONOMIST: Screw Treaty Change, This Is How The ECB Can Fix Europe Tomorrow
Markets

These 10 Dates Are Crucial For The Future Of Europe

[credit provider=”Steve Hodgson on Flickr” url=”http://www.flickr.com/photos/craiglea/6032968014/#/”] As the news cycle winds down for the year, it remains clear to investors that the eurozone crisis is far from over.After action by the European Central Bank last week to shore up bank liquidity, investor sentiment has soured. Banks are storing a record […]
These 10 Dates Are Crucial For The Future Of Europe
Markets

With German Inflation Cool, Will The ECB Get Creative?

[credit provider=”AP/Riccardo De Luca”] With German CPI coming in this morning at a cool 2.4% compared with 2.8% in November, analysts are wondering if another rate cut—and possibly even more drastic measures like quantitative easing—could really be ahead for the European Central Bank.According to Bloomberg, analysts expect euro area inflation […]
With German Inflation Cool, Will The ECB Get Creative?
News

FROM TIGER WOODS TO THE ECB: Here Are My Fearless Predictions For 2012

[credit provider=”Getty”] Significant economic and political changes will make 2012 a historical year.The globe has experienced relative calm for the past 24 months. That stability won’t last much longer. Events that are not on anyone’s radar screen will matter the most. The following are the things that I think might […]
FROM TIGER WOODS TO THE ECB: Here Are My Fearless Predictions For 2012
Markets

S&P On ECB’s Latest Action: ‘Still Kicking The Big Old Can Down The Road’

[credit provider=”Adam Berry / Getty Images” url=”http://www.gettyimages.com/detail/news-photo/the-europe-sculpture-by-belgian-artist-may-claerhout-news-photo/134033791″] The European Central Bank’s action to lend €489 billion to the region’s banks at low interest rates, will stave off immediate concerns, but will not be the silver bullet the continent needs, Scott Bugie, managing director of Standard & Poors financial institutions division, told […]
S&P On ECB’s Latest Action: ‘Still Kicking The Big Old Can Down The Road’
Markets

GOLDMAN: 5 Reasons Today’s Big ECB Action Was Good News

[credit provider=”DieselDemon via Flickr” url=”http://www.flickr.com/photos/[email protected]/4298600063/”] The market is selling off in the wake of the ECB’s 3-year LTRO, but considering the gigantic rally yesterday, and the tendency for investors to “sell the news” this isn’t that remarkable.In a note out this morning, Goldman explains why the big result was a […]
GOLDMAN: 5 Reasons Today’s Big ECB Action Was Good News
Markets

BOOM: ECB Liquidity Operation Sees Massive Demand

[credit provider=”Financial Times photos via Flickr” url=”http://www.flickr.com/photos/financialtimes/6440873573/sizes/l/in/photostream/”] This morning saw the results of the ECB’s massive liquidity operation.The operation — which has been the subject of intense chatter and speculation for the last couple of weeks in Europe — allowed banks to borrow super-cheap money for up to 3 years […]
BOOM: ECB Liquidity Operation Sees Massive Demand
Markets

ECB: Yes, This Really Could Be Like Lehman Again

[credit provider=”Wikimedia Commons NOAA” url=”http://commons.wikimedia.org/wiki/File:Lightning_NOAA.jpg”] The European Central Bank published a financial stability review today, presenting a remarkably cynical assessment of the risks to the eurozone right now.In fact, while the paper says December 9’s summit contained “several basic elements that are key for the restoration of financial stability in […]
ECB: Yes, This Really Could Be Like Lehman Again
Markets

NO DICE: Here’s Why The ECB’s Newest Gamble To Save The Euro Won’t Work

[credit provider=”Qfamily on Flickr” url=”http://www.flickr.com/photos/dasqfamily/1455144539/”] Speculation that the European Central Bank may already have solved the sovereign debt crisis is all the rage today, but jubilation over the new measures is short-sighted.While the ECB’s liquidity support measures may indeed slow the momentum of the crisis significantly, they still do nothing […]
NO DICE: Here’s Why The ECB’s Newest Gamble To Save The Euro Won’t Work
Markets

THE HOTTEST QUESTION IN EUROPE: Did The ECB Just Pull Off A Back-Door Bailout That Will End The Crisis?

[credit provider=”Marko Milosevic on Flickr” url=”http://www.flickr.com/photos/nictalopen/188360287/”] Yields on short-term peripheral sovereign bonds are plunging, despite the fact that EU leaders appeared to make little progress at their highly-anticipated summit last week.Pundits continue to expound on the flaws of the eurozone but markets are telling a different tale.
THE HOTTEST QUESTION IN EUROPE: Did The ECB Just Pull Off A Back-Door Bailout That Will End The Crisis?
Markets

The 10 Big Stories You Probably Missed This Week

[credit provider=”Flickr/Faramarz Hashemi” url=”http://www.flickr.com/photos/fhashemi/84663672/”] Don’t blame yourself if you missed a few key things this week. Even with one eye on CNBC and the other on your Bloomberg terminal, it’s likely you’d only remember news coming out of Europe.
The 10 Big Stories You Probably Missed This Week
Markets

Here’s What To Expect From Today’s Big ECB Meeting

[credit provider=”Zechariah Judy on Flickr” url=”http://www.flickr.com/photos/[email protected]/4268587808/”] Wall Street analysts appear unequivocal in their forecasts for today’s monetary policy decision by the European Central Bank: the ECB will cut rates by 25bps and throw a bone to banks, but not much else.Hopes for the summit of EU leaders on Friday lean […]
Here’s What To Expect From Today’s Big ECB Meeting
Markets

PIMCO: 9 Charts That Explain Why Central Banks Should Save The World Right Now

[credit provider=”PIMCO” url=”http://www.pimco.com/EN/Insights/Pages/Waiting-for-All-In–.aspx”] A crisis of confidence and uncertainty is antagonizing the global economy as everyone waits for central banks, around the world—led by the European Central Bank—to go “all in,” PIMCO’s Mark Kiesel writes in a new column out today.Ultimately, he argues, the central banks have the power and […]
PIMCO: 9 Charts That Explain Why Central Banks Should Save The World Right Now
Markets

Here’s S&P’s REAL Message To Europe

Markets have taken a tumble since a report surfaced that six AAA-rated EU countries—including Germany—are about to be put on creditwatch negative by Standard & Poor’s ratings agency.
Here’s S&P’s REAL Message To Europe
Markets

CREDIT SUISSE: The Game Of Chicken Is Almost Over

[credit provider=”Nienetwiler, Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:Appenzeller-Spitzhauben1_PSR.jpg”] Right now, the hope among Eurozone optimists is that this week, European leaders will be able to quickly move to an agreement on a fiscal pact, and be ready to announce something on December 9 (Friday).Then, if it’s clear that the governments have committed to […]
CREDIT SUISSE: The Game Of Chicken Is Almost Over
Markets

Suddenly, Europe’s Gameplan For Saving Itself Is Becoming Very Clear

[credit provider=”Anthony Dawson via flickr “] EDIT NOTE: We originaly published this early Thursday, but more publications are talking about this now, and wanted to resurface it, as this is a very important point for understanding the next steps in Europe.The Eurozone could still end up in smouldering ruins, but […]
Suddenly, Europe’s Gameplan For Saving Itself Is Becoming Very Clear
Markets

This Is A Turning Point For Germany And The Euro Crisis

[credit provider=”Reuben Whitehouse on Flickr” url=”http://www.flickr.com/photos/rcktfld/2264092951/”] This is a new day for Europe.A failed German bond auction last week has spurred a turnaround in Europe, according to WJB Group Chief Market Strategist Brian Reynolds.
This Is A Turning Point For Germany And The Euro Crisis
Markets

Here’s Why Italy Is Still At The Heart Of The Vortex

The focus is on next week’s ECB meeting and the EU summit. Nearly every one is expecting a 25 bp rate cut and if expectations are wrong, it is more likely that it is because of more aggressive action, like a 50 bp cut, than less. Separately, it will also […]
Here’s Why Italy Is Still At The Heart Of The Vortex
Markets

rumour DU JOUR: National Central Banks Could Step In With The IMF To Save Europe

[credit provider=”Wikimedia Commons” url=”http://www.businessinsider.com.au/cms/posts/edit?id=4ed1958feab8eac727000023″] The European Central Bank has repeatedly refused to step in and bail out European sovereigns, but now investors are chattering about another possible way out.National central banks (NCBs) could technically print money through the Emergency Liquidity Assistance program and loan that to the International Monetary Fund, […]
rumour DU JOUR: National Central Banks Could Step In With The IMF To Save Europe
Markets

10 Things You Need To Know This Morning

[credit provider=”Shutterstock”] Good morning. Here’s what you need to know. Asian markets were mostly lower, with the Shanghai SE Composite shedding 3.3%. Europe followed suit, with the French CAC and German DAX down moderately. U.S. futures are pointing to a higher open. The Federal Reserve, in conjunction with five other […]
10 Things You Need To Know This Morning
Markets

Now There Are A Bunch Of New Troubling Headlines Coming Out Of Europe

[credit provider=”Daniel Goodman / Business Insider”] There are a ton of negative headlines coming out of Europe this morning.Besides rumours about an impending downgrade of France’s credit rating and worries about rising Italian bond yields, today brings new fears about the eurozone crisis.
Now There Are A Bunch Of New Troubling Headlines Coming Out Of Europe
Markets

CITI’S BUITER: 4 Conditions Must Be Met First, But The ECB Will Intervene

[credit provider=”Wikimedia Commons” url=”http://www.businessinsider.com.au/cms/posts/edit?id=4ed1958feab8eac727000023″] A team of Citi analysts led by Chief Economist Willem Buiter predict that the European Central Bank will ultimately step in to save the eurozone, but not just yet.According to an investor note released yesterday, four conditions must be met in order to warrant stronger ECB […]
CITI’S BUITER: 4 Conditions Must Be Met First, But The ECB Will Intervene
News

Here’s The Easy Solution To The Euro-Crisis That Absolutely No One Will Discuss

[credit provider=”Wikipedia” url=”http://en.wikipedia.org/wiki/File:DeMilleTenCommandmentsDVDcover.jpg”] Last weekend, we wrote about how the Euro-crisis should be resolved: The same way all debts-that-can’t-be-repaid get resolved–via bankruptcy and restructuring.This is the simple, fair solution to the crisis, but of course no one is discussing it because it would involve “losses.”
Here’s The Easy Solution To The Euro-Crisis That Absolutely No One Will Discuss
Markets

A Bullish Development Regarding The ECB…

[credit provider=”AP”] In his latest note from last night, BTIG’s Dan Greenhaus makes a good observation:…it appears that pressure is growing on the ECB to act more decisively. While many in the markets choose to view the ECB purely and solely through the prism of German “tolerance,” numerous countries and […]
A Bullish Development Regarding The ECB…
News

Here Are The 4 Ways The Euro-Crisis Might Get Resolved

[credit provider=”Copyright — Tomasz Raś” url=”http://www.flickr.com/photos/rasmachine/sets/72157628104533122/”] As Europe barrels ever closer toward the edge of the cliff, it’s worth reviewing the different ways the crisis might get resolved (or resolve itself).Here are the 4 basic possibilities:
Here Are The 4 Ways The Euro-Crisis Might Get Resolved
Markets

EUROBONDS: Here’s Why They Actually Make A Lot Of Sense

[credit provider=”wikimedia commons” url=”http://commons.wikimedia.org/wiki/File:Darkness_Light_bulb_2.jpg”] Europe has been abuzz with lots of talk about a eurozone endgame, and the talk is promising. While EU leaders may not yet have reached an agreement on exactly what to do, all the signs point to a far more radical intervention than they previously planned […]
EUROBONDS: Here’s Why They Actually Make A Lot Of Sense
Markets

Euro Bonds Remain Europe’s Only Way Out For Now

The Euro crisis is getting deeper into the uncharted territory with bond yields surging across Europe on Friday Nov. 25, after Fitch Ratings cut Portugal’s debt rating to “junk” status.  Standard & Poor’s later also delivered a debt downgrade to Belgium to AA from AA+.  Moody’s stayed busy and lowered […]
Euro Bonds Remain Europe’s Only Way Out For Now
Markets

WAIT! Is This The First Sign That The ECB Might Save The Eurozone?

[credit provider=”Wikimedia Commons” url=”http://www.businessinsider.com.au/cms/posts/edit?id=4ed1958feab8eac727000023″] There are reports going around about how France and Germany might engage in some kind of new “stability pact” to fight the sovereign debt crisis. This Reuters report, which itself is citing a German newspaper, is fairly sparse when it comes to details, but it would […]
WAIT! Is This The First Sign That The ECB Might Save The Eurozone?
News

HOLY EURO-CRISIS, BATMAN! Italy’s Borrowing Costs Have Doubled In Two Months

[credit provider=”Bloomberg” url=”http://www.bloomberg.com/apps/quote?ticker=GBTPGR2:IND”] Imagine that your household is spending ~5% more than it takes in every year, which means that you have to keep adding that extra 5% to your credit card debt to make ends meet.And imagine that, from years of spending more than you take in, you have […]
HOLY EURO-CRISIS, BATMAN! Italy’s Borrowing Costs Have Doubled In Two Months
Markets

FORGET THE IMF: The Onus Is On Germany And The ECB To Fix Europe

[credit provider=”Charlotte McKnight on Flickr” url=”http://www.flickr.com/photos/indigo-eyes/5978065808/”] Today’s announcement by the International Monetary Fund that it would offer massive credit lines to sovereigns targeted by external shocks sparked a brief market rally, but any momentary confidence behind that move has faded—and for good reason.In reality, today’s proposal changes nothing for Europe. […]
FORGET THE IMF: The Onus Is On Germany And The ECB To Fix Europe
Markets

EUROBONDS: The REAL Euro Endgame You Should Be Watching

[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:EUR_5_holographic_band.jpg”] While support for intervention by the European Central Bank to fix the eurozone crisis has never been stronger, serious doubts remain about the likelihood that such intervention would actually fix the euro or that Germans would be likely to approve it.And while the media may remain […]
EUROBONDS: The REAL Euro Endgame You Should Be Watching
Markets

Here’s What Investors Don’t Understand About The ‘Merkel Put’

[credit provider=”AP”] “ECB bailout or bust.”  So says Paul Krugman and he’s one of many.Outside of Germany, a consensus among economists has emerged that the European Central Bank is the only body capable of arresting the debt crisis coursing through the region’s veins. With the European Financial Stability Facility (EFSF)  […]
Here’s What Investors Don’t Understand About The ‘Merkel Put’
Markets

EUROPE: Print Or Perish

Europe is again at centre stage. At conferences and meetings and in private conversations, it is the topic of the hour. I have thought a lot this week about Europe and its impact, so once again we delve into what is an evolving situation.
EUROPE: Print Or Perish
Markets

A Crucial Point On The Legality Of The ECB Buying Up Sovereign Debt

[credit provider=”AP/Riccardo De Luca”] Contra some pundits, Nomura argues that it would absolutely be legal and mandate consistent for the ECB to use a bazooka to stop the crisis.To pick up on the last point, the ECB would appear to have more legal authority to take radical action to quell […]
A Crucial Point On The Legality Of The ECB Buying Up Sovereign Debt
Markets

OK, Now EVERYONE Agrees That There’s One Solution Left In Europe…

[credit provider=”10,000 Year Clock” url=”http://www.10000yearclock.net/learnmore.html”] A couple of nights ago we wrote about how obvious it was that the only solution that was left in Europe was the money printing solution. The ECB needs to use its unlimited balance sheet to depress interest rates on peripheral debt.The number of people […]
OK, Now EVERYONE Agrees That There’s One Solution Left In Europe…
Markets

Here’s What Happens If The ECB Monetizes Eurozone Debt

As the pressure on ECB grows to step up its “bid of last resort” for European sovereign bonds, the folks over at Zero Hedge ask the very important question what are consequences if the ‘zone  resorts to massive debt monetization?    Here is one plausible scenario we’re looking at.
Here’s What Happens If The ECB Monetizes Eurozone Debt
Markets

Why The ECB Is NOT Going To Be A Lender Of Last Resort

There are only two real game-changers left in the euro crisis: fiscal union and the ECB stepping in as a lender of last resort (LOLR). The former for now is resolutely off the table, particularly in the time period necessary for it to keep the eurozone together. Very bright people […]
Why The ECB Is NOT Going To Be A Lender Of Last Resort
Markets

7 Big Debates Happening In Europe Right Now

[credit provider=”Erik Stabile on Flickr” url=”http://www.flickr.com/photos/erikstabile/3888091614/”] There are lots of cooks in the kitchen in the eurozone.It’s hard to remain grounded with EU leaders yelling—or worse, politicking—at each other all the time, let alone keep track of all the rumours that are driving markets crazy.
7 Big Debates Happening In Europe Right Now
Markets

A Quick Guide To What’s Going On In This Debate About The ECB

[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:EUR_5_holographic_band.jpg”] This whole debate about whether or not the European Central Bank should be more involved in bailing out Europe has been dominating headlines.But although this debate is earning a lot of air-time, the reasons the ECB is not so keen on this plan have not changed.
A Quick Guide To What’s Going On In This Debate About The ECB
Markets

This Is What Europe’s Second Big Bazooka Should Look Like

The crisis has spread to the core. Not only have Italian and Spanish bond yields shot up to unsustainable levels, but Belgian, Austrian and French spreads over the comparable German bunds have risen sharply in recent days as well. If the EU, the ECB and the IMF do nothing and […]
This Is What Europe’s Second Big Bazooka Should Look Like
Markets

Merkel And Germany Are Saying All The Wrong Things At Exactly The Wrong Time

[credit provider=”AP”] Everyone knows that expanding the role of the European Central Bank—by making a commitment to unlimited sovereign bond purchases or providing virtually unlimited funds to the European Financial Stability Facility—is the obvious way out of this crisis, and now all bets are off between Germany and France about […]
Merkel And Germany Are Saying All The Wrong Things At Exactly The Wrong Time
Markets

Citi Suggests A ‘Tremendous’ Trade Opportunity In Europe

[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:Complicated_Balls.JPG”] If you’ve got the guts, Citi’s Steven Englander has a trade for you in Europe.There is an upside tail to the euro, despite our baseline view. There is overwhelming market pessimism with respect to euro zone outcomes. Positioning is euro negative but not as extreme as […]
Citi Suggests A ‘Tremendous’ Trade Opportunity In Europe
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