Troika officials have postponed for the second time the decision on the next tranche of Greek aid under the 2010 agreement. While this seems to tempting the fates and fanning fears of a default, it does not appear that Greece needs the money until the mid-Nov, the new time frame […]
Peter Westaway, the chief Europe economist at Nomura, has resigned, according to Dow Jones.
Maybe it’s the buzz about Papandreou possibly resigning.
The iconic and world renowned Louvre museum in Paris is currently ablaze.
Hedge fund manager Kyle Bass is a big character in Michael Lewis’ new book, Boomerang: The Meltdown Tour.
The euro has taken a major tumble this morning, down more than $0.01 on the dollar in the last hour.
Cameron: Euro crisis may provide “future opportunities” for EU renegotiation; MPs could debate in/out referendum In an interview on the first day of the Conservative Party conference, David Cameron suggested that forthcoming EU treaty changes to fix the eurozone could provide the Government with an opportunity to demand the repatriation […]
As Washington pushes harder for a bold resolution to the euro debt crisis, the conflict has turned into this: Germany versus the U.S.
Here we go.
[credit provider=”danielh on Flickr” url=”http://www.flickr.com/photos/holgatepics/79261436/”] Chinese newspaper “People’s Daily” published a front page editorial Saturday telling Europe to quit “dilly-dallying” and get its act together, via Reuters.While the paper is not the official mouthpiece for the government, it is considered an organ of the Central Committee of the Communist Party […]
[credit provider=”en.wikipedia.org” url=”http://en.wikipedia.org/wiki/Wolfgang_Sch%C3%A4uble”] German Finance Minister Wolfgang Schaeuble ruled out a larger German contribution to the European Financial Stability Facility in an interview published Saturday, according to Sky News.”The European Financial Stability Facility has a ceiling of 440 billion euros, 211 billion of which is down to Germany. And that […]
I couldn’t be more delighted than to see the DAX get tagged for 2.5% today. This is a consequence of the “Successful” vote yesterday in the German Parliament to throw more good money after bad. The hit (so far) to German investors comes to $40b. That should make them happy […]
The euro is down big today against the dollar, falling 1.30% over the course of the day, as traders stash cash in other currencies.
[credit provider=”Robin Zebrowski on Flickr” url=”http://www.flickr.com/photos/firepile/68493747/”] A top official at the European Central Bank said off the record that the ECB/EU/IMF troika could require private holders of Greek bonds to accept a 75% haircut rather than the 21% they were expected to take, according to Italian newspaper Linkiesta (via @FGoria).This […]
[credit provider=”Ibrahim Iujaz on Flickr” url=”http://www.flickr.com/photos/notsogoodphotography/5739769957/”] With the media outlook swinging from wildly positive to wildly negative on a daily basis and rumours spiraling out of control, it can be hard to tell exactly where things stand on the eurozone crisis.But let’s be clear: the eurozone crisis is NOT going […]
[credit provider=”Flickr/Seth Lemmons” url=”http://www.flickr.com/photos/slemmon/3956905933/”] While two potentially promising policy responses to the eurozone crisis circulate, EU leaders are still failing to do what the market needs them to do in order to restore confidence and stem contagion.That’s the gist of what BTIG’s Chief Global Strategist Dan Greenhaus says in his […]
[credit provider=”AP”] European Union leaders have offered Belarus’ president, Alexander Lukashenko, $9 billion if he releases political prisoners and holds regular democratic elections, reports EU Observer.Lukashenko would not have to step down as part of the deal, but it is expected that the authoritarian leader would be ousted if he […]
Will this crisis ever be over?!
[credit provider=”Wikimedia Commons”] Silvio Berlusconi has said that if it weren’t for the current economic sensitivity in Europe he would have fired his finance minister, Guilio Tremonti, long ago.Der Spiegel describes the relationship between the two as a “risky vendetta.” Tremonti has said it’s “impossible” to work with the Italian […]
The latest piece by Ambrose Evans-Pritchard of the Telegraph highlights a disturbing error this deep into the crisis. Angela Merkel is still referring to this crisis as a debt crisis:
[credit provider=”AP” url=”http://www.apimages.com/secured_user/Download.aspx?st=dl&id=5b691f3dc5c8457d84ac12cf5cfa407a&isgb=false”] According to The Telegraph, German Finance Minister Wolfgang Schauble said that boosting the EFSF would be a stupid idea because it would “endanger the AAA sovereignty of member states.”And when the White House said that failing to to recapitalize banks was “scaring the world,” Schauble basically told […]
[credit provider=”timekin/Flickr” url=”http://www.flickr.com/photos/mekin/281791343/sizes/m/in/photostream/”] The Eurozone bailout, now being referred to as Euro TARP, is doomed to fail. While nothing has been officially announced the markets are rallying broadly on the back of a news article published by CNBC on Monday. The details are lacking as to the actual structure but […]
TMM chuckled to themselves upon reading the A-Team’s latest trial balloon, as the irony of an idea grown out of financial innovation and structured credit coupled with leverage is presented as the solution to a crisis caused by precisely the same things. But in seriousness, TMM are unconvinced that this […]
[credit provider=”flickr” url=”http://www.flickr.com/photos/ceesjw/4881555885/sizes/l/”] The U.S. dollar had made massive gains last week as investors fled to the safe have currency. We had been following the dumping of emerging market currencies in particular. Renewed hope that the eurozone is going to expand and ratify the EFSF, and Merkel’s commitment to helping Greece […]
[credit provider=”kamerakamote on Flickr” url=”http://www.flickr.com/photos/tzf093/5689589640/”] A series of rumours have had markets on an obstacle course for the past two weeks, with investors jumping back and forth on whatever piece of news hits the wires.The nauseating trail back and forth has left some dazed and confused.
[credit provider=”flickr / jurjen_nl” url=”http://www.flickr.com/photos/jurjen_nl/5271842133/”] UPDATE: Now German Vice Chancellor Philip Rösler is saying that leveraging the EFSF is “off the table,” while Finance Minister Wolfgang Schaeuble has said both that he would support leveraging the EFSF and that he did not think the fund needed to be expanded.
[credit provider=”AP” url=”http://www.apimages.com/OneUp.aspx?st=k&kw=Evangelos%20Venizelos&showact=results&sort=creationdatelower%3Areversealphabetical&intv=None&sh=10&kwstyle=and&adte=1314047304&pagez=60&cfasstyle=AND&rids=554882c6cfc04508abc8c8be1c0c63d1&dbm=PY2011&page=1&xslt=1&mediatype=Photo”] Greek Finance Minister Evangelos Venizelos warned today that if Europe cannot save Greece, it cannot save itself, according to Bloomberg.Reuters also reports that he proposed a “euro-atlantic axis” to take steps to resolve the crisis.
A Treasury Department spokeswoman categorically ruled out the use of U.S. government funds to help with an IMF bailout of European banks through the European Financial Stability Facility.
[credit provider=”F Delventhal on Flickr” url=”http://www.flickr.com/photos/krossbow/300449893/”] This is a BIG week for Greece and the euro.A number of crucial votes could decide the fate of the Greek bailout and whether or not we will see the proposed expansion of the European Financial Stability Facility come to fruition.
Rep. Cathy McMorris Rodgers (R-WA), the Vice Chair of the House Republican Conference, released a statement Monday saying that she would oppose any effort increase funding for the International Monetary Fund to be used to bailout European banks.
[credit provider=”Lars Aronsson, Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:La2-euro.jpg”] CNBC is citing an EU official who says that a plan for a leveraged EFSF is virtually ready to go, and is simply awaiting approval from EU leaders.The plan allegedly includes measures to increase the funding of the EFSF and recapitalize European banks.
Only QE3 or “a very benign euro zone outcome” would justify the euro’s high value against the dollar, writes Citi FX strategist Steve Englander in an investor note published today.
[credit provider=”commons.wikimedia.org” url=”http://commons.wikimedia.org/wiki/File:MARINELEPEN.jpg”] The leader of France’s Front National party, Marine Le Pen, has said her far-right party’s scepticism of the euro has been proved right, reports the Telegraph.A decade ago, Front National dismissed the common currency, an attitude that was portrayed as a nationalistic sentiment more than anything else.
[credit provider=”www.flickr.com” url=”http://www.flickr.com/photos/rodimuspower/4295993935/”] rumours of a major plan to prop up the eurozone may have bolstered markets this morning, but there’s reason to believe that such a plan either does not currently exist or is not yet much more than an outline.A number of EU officials denied reports that leveraging […]
[credit provider=”AP Images”] German and French officials have made strides at the World Bank/IMF Meetings this weekend towards outlining a huge new plan to save the euro, according to a Telegraph report.By building a “firebreak” around Greece, Ireland, and Portugal, bolstering banks, and expanding the European Financial Stability Facility, they […]
With analysts sure the euro is on the outs, investors are searching for the next big currency to invest in.
[credit provider=”AP”] Spain appears to have dropped off radar screens. In part, a disorderly outcome of the Greek crisis continues to be threatened. Italian bond yields and CDS prices have risen above Spain’s. Yet, ironically, earlier this week, Spain’s central bank warned that its banking problems are bound to get […]
Credit Suisse has a big report out (via Fabrizio Goria at Linkiesta) on the fallout of a eurozone break up, and it’s not pretty.
European markets ended flat today, with little inspiring news coming off the wires.
The markets are living and dying on news regarding the Eurozone debt crisis, which is quite complicated. That’s why Morgan Stanley put together a comprehensive guide on how everything financial works on the continent.
The euro is plummeting, swiftly erasing all gains made since U.S. markets closed yesterday.
[credit provider=”AP” url=”http://www.apimages.com/OneUp.aspx?st=k&kw=Evangelos%20Venizelos&showact=results&sort=creationdatelower%3Areversealphabetical&intv=None&sh=10&kwstyle=and&adte=1314047304&pagez=60&cfasstyle=AND&rids=554882c6cfc04508abc8c8be1c0c63d1&dbm=PY2011&page=1&xslt=1&mediatype=Photo”] Greek Financial Minister Evangelos Venizelos has told fellow socialists he sees three scenarios for Greece, according to Ta Nea via Bloomberg.In the “good” scenario, Europe hands over the bailout money along with a 20% writedown for bondholders.
[credit provider=”patola via flickr” url=”http://www.flickr.com/photos/patola/67905802/sizes/m/in/photostream/”] The Euro rebounded sharply from $1.344 earlier this afternoon to $1.356 late this evening on no obvious news.However, according to Reuters, a Japanese new service reported that the Group of 20 was preparing an unscheduled announcement, stating that it would cooperate in an effort to […]
[credit provider=”AP” url=”http://www.apimages.com/OneUp.aspx?st=k&kw=merkel%20papandreou&showact=results&sort=relevance&intv=None&sh=10&kwstyle=and&adte=1315839661&pagez=60&cfasstyle=AND&rids=3e8a80499bda48b3864c1bd713b0e6db&dbm=PY2011&page=1&xslt=1&mediatype=Photo”] The Telegraph reports that EU leaders generally agree that a Greek default is imminent but that Greece will not leave the euro.The report cites talks in Paris, Berlin, Frankfurt, and Brussels over how to handle a Greek default in the short to medium term.
[credit provider=”John D. Carnessiotis on Flickr” url=”http://www.flickr.com/photos/aster-oid/3383912837/”] As everyone in the world was transfixed on the Fed, Greece continues to do what it takes to get its next bailout tranche and stay in the Eurozone.The Greek cabinet agreed on yet another round of austerity measures today. The details come to […]
[credit provider=”Demolition Dynamics” url=”http://www.demolitiondynamics.com/sports.php”] There is a significant chance that the Euro itself will collapse in the coming weeks or months. Although the highly likely Greek government default may act as the trigger, the collapse of the European Monetary Union (EMU) and its currency is a quite different event from a […]
It is remarkable that Irish 10-year yields have completely decoupled from Greece. At the beginning of the year, the 60-day correlation between Irish and Greek 10-year yields was above 0.90. Today, the correlation stands at -0.42. At the same time, Irish 10-year bonds yields have become significantly more correlated with […]
The Bank for International Settlements just released their latest data: how much banks are exposed to sovereign Greek debt as of the first quarter ending March 31 2011.
A few hours ago Timothy Geithner was in Poland promoting his plan for a EuroTARP, while Greek PM George Papandreou was preparing to fly to New York for meetings with the U.N. and the IMF.
[credit provider=”Wikimedia Commons” url=”http://commons.wikimedia.org/wiki/File:Hokusai_The_Ghost_Kohada_Koheiji.jpg”] Nomura’s Peter Westaway, Jens Sondergaard, and Dimitris Drakopoulos present a note called Thinking The Unthinkable in which they note with dismay the “inability and unwillingness of policymakers to take swift action” in Europe.While they still see Europe surviving and muddling through the current crisis, they’ve reassessed […]
Former British Prime Minister, Gordon Brown says that the current financial woes are worse than they were in 2008, reports the Telegraph.Speaking at the World Economic Forum in Dalian, China, Brown said he believes that the world’s economy could fall into a 1930-like slump if matters continue in the same […]
A big announcement by the European Central Bank on renewed dollar liquidity measures sent markets soaring today, and pushed the euro significantly higher against the dollar.
The euro is making a huge recovery against the dollar after the ECB announced coordinated dollar liquidity measures with the Federal Reserve, the Bank of England, the Bank of Japan, and the Swiss National Bank.
George Soros says to resolve the euro crisis we must “think about the unthinkable,” in a new essay for New York Review Of Books.
Britain will sue the European Cental Bank to prevent it from implementing a new policy that would drive London’s financial services sector to the Continent, according to the FT.
The manager of the huge $47 billion macro fund Fortress, Mike Novogratz, is going long the dollar vs the Euro, UK pound, and the Australian dollar, according to Dow Jones.He says there are four things hurting the dollar:
[credit provider=”AP”] Slow growth is embedding itself solidly into the US economy and the bond mayhem in Europe continues. The external environment for China is getting worse. This will almost certainly make China’s adjustment – when Beijing finally gets serious about it – all the more difficult. With still weak […]
Headlines just hit the wire that Nicolas Sarkozy told the French Cabinet he would do everything to save Greece.
[credit provider=”Team at Carnaval.com Studios / flickr” url=”http://www.flickr.com/photos/aforum/3028414320/”] Amid a rumour-filled day, one that stood was the chatter about the BRICS nations possibly working together to bail out Europe.The rumours seemed to be emanating out of the Brazil camp, but there were also rumours relating to China and Russia, so […]
[credit provider=”Patrick Hoesly on Flickr” url=”http://www.flickr.com/photos/zooboing/4183279204/”] Citi’s Willem Buiter is out with a new note firmly opposing all those who toy with the idea of a Greek exit from the eurozone.”The prospect of Greece exiting the euro area is seldom viewed with the proper degree of fear and trepidation,” he […]
A senior French government official told Reuters (via Zero Hedge) that German Chancellor Angela Merkel and French President Nicolas Sarkozy will “take action” in an announcement today on Greece.
Way back in the mid 70s I was a Snake trader for a bank. This was a period before the EURO was adopted. The European currencies had established trading bands of 2-3% against each other. This was pre computer days, so figuring out where markets where vis a vis the […]
This time may well be different, but not in a positive way.
[credit provider=”Wikimedia Commons” url=”http://en.wikipedia.org/wiki/File:Jim-rogers-madrid-160610.jpg”] A Greek default may lead to a default in Italy, Spain and elsewhere, causing massive selling in the euro.Jim Rogers says in this likely scenario — which could begin this weekend — you should buy the dip. He told CNBC yesterday (via @_alea):
The dollar is at it’s highest value since February, as fears of a Greek default escalate.
This is the big market story of the moment.
For months, an increasingly frenetic, even apocalyptic, debate about the fate of the euro has been the major driver of global instability.
How should I begin this post? Let me start out with my former default position:
European Central Bank President Jean-Claude Trichet launched into a mini tirade in response to a question about Germans talking about leaving the euro zone at his press conference today.
As the euro faces an existential crisis, David Cameron has moved to reassure the British public that his country will not be joining, Sky News reports.Maybe it was the nasty stuff UBS said about the currency yesterday that swayed him. Or, it could be the Euro’s own architect describing it […]
[credit provider=”Twitpic” url=”http://twitpic.com/5i0v4d”] Europe’s debt crisis often seems like a giant snowball accelerating down a hill.With each rotation, it picks up more destructive power.
[credit provider=”flickr / jurjen_nl” url=”http://www.flickr.com/photos/jurjen_nl/5271842133/”] The European Union is finally approaching a much postponed moment of decision. Will the EU turn into a true USE (United States of Europe) or will it subside into something looser and less ambitious — a new Holy Roman Empire of loosely confederated but uncoordinated minor […]
Initially the Euro spiked against the dollar after the the Swiss National Bank intervention was announced.
[credit provider=”http://www.gahetna.nl” url=”http://www.gahetna.nl/collectie/afbeeldingen/fotocollectie/zoeken/weergave/detail/q/id/ace35288-d0b4-102d-bcf8-003048976d84″] A former leader of the Dutch liberal party Frits Bolkestein (who is now out of office) voices (yet another) angle on the Greek aide question.Via NRC.nl (via Google Translate)
The news stream continues to push the edges of the narrative outline here earlier. US mired in slow growth, but not contracting (here in Q3). A fiscal and monetary response is likely to be forthcoming in the next few weeks. The euro zone slowed dramatically and Q3 is off to […]
UPDATE: European markets are now closed.
[credit provider=”Flickr” url=”http://www.flickr.com/photos/tupwanders/4964020690/”] Believe it or not, Germany’s financial slowdown is a blessing in disguise.At least that’s what Alberto Alesina and Francesco Giavazzi write in an editorial published today.
The dollar rose this morning against the yen, the pound, gold, and especially the euro.
The EUR/USD currency pair has been staggered in a well-developed range for a prolonged period of time.
[credit provider=”UPTRAIN via Flickr” url=”http://www.flickr.com/photos/uptrain/3428589576/”] UPDATE: After speaking to Cleary Gottlieb and a reporter from the Greek newspaper Eleftherotypia, we have found that an early report out of Greece was insignificant.A paper on the legal issues involved with a country leaving the Euro was presented at an academic conference held […]
The euro was down nearly 1% on the yen after overnight trading, as worries about the sovereign debt crisis intensified.
[credit provider=”patola via flickr” url=”http://www.flickr.com/photos/patola/67905802/sizes/m/in/photostream/”] Dutch drivers were treated to a bailout today when a package containing a large amount of money fell from a truck, spilling euros everywhere.According to the AP there was a “dangerous scramble” for the bills with people running away with handfuls of cash. No one […]
The EU is working on a “radical plan” to prevent a European credit crunch, according to a new report in the Times Of London (via CNBC).
Eurobonds are being touted as the silver bullet to resolve the Eurozone crisis. This column argues that the Eurobonds proposal fails on legal, political, and economic grounds. It says that, whatever the variant, Eurobonds only make sense in a political union—and given the vast differences in national political systems and […]
[credit provider=”patola via flickr” url=”http://www.flickr.com/photos/patola/67905802/sizes/m/in/photostream/”] The millions of American tourists travelling to Europe this summer face a rude awakening as soon as they clear customs: The dollar doesn’t go very far against the euro. Recently, it’s been trading in a range near $1.44 to the euro. (10 years ago, a […]
[credit provider=”AP”] Some dramatic comments from former Federal Reserve Chairman Alan Greenspan.”The euro is breaking down and the process of its breaking down is creating very considerable difficulties in the European banking system,” Greenspan said today, according to Bloomberg.
Two important articles today on the gnarly topic of liquidity in Europe.
One of the many enjoyable acronyms that became household names in 2008 was CDS – credit default swap. As most investors know by now, these instruments were created to protect bondholders from default. Of course, what we found out in 2008 was that they really just shifted the risk from […]
[credit provider=”www.time.com” url=”http://www.time.com/time/covers/0,16641,20110822,00.html”] This weekend Herman Von Rompuy of the European Council said that creating eurobonds to end the EU’s debt crises would be impossible without fiscal convergence. Similar statements have been made by many, including German Finance Minister Wolfgang Schaeuble, who warned of an “inflation community” if fiscal policies […]
[credit provider=”jeaneem via Flickr” url=”http://www.flickr.com/photos/jeaneeem/990306103/sizes/l/in/photostream/”] Capital preservation has once again has become mantra. The safety offered by Japan and Switzerland are meeting resistance from policy makers. As the market looks for alternatives, the Swedish krona has much to offer, including a relatively robust economy, low public debt and a current […]
Rather than try to wade through all the news this month, much of which doesn’t seem to have much informational content, I thought I would duck out altogether and instead make a list of things I expect will happen over the next several years. We are so caught up in […]
It’s not fun to be working at Credit Suisse, RBS, Deutsche Bank and UBS right now.Euro banks are getting slammed with a number of questions about their stability.
[credit provider=”Πρωθυπουργός της Ελλάδας on Flickr” url=”http://www.flickr.com/photos/primeministergr/5566180660″] Jacques Delors — one man responsible for ushering in the European Economic and Monetary Union — told Swiss newspaper Le Temps that Europe and the euro risk falling from “the edge of a precipice.””To avoid falling, the choice looks straightforward to me: either […]
The official line is that Angela Merkel does not care for euro-bonds.
[credit provider=”Dominik Golenia on Flickr” url=”http://www.flickr.com/photos/dominikgolenia/2255767532/”] Over the course of a news-packed summer, Europe has gone from bad to worse.What was being addressed as a Greek problem three months ago has now turned into a European problem of epic proportions — in fact, since the Greek bailout in late July, […]
Good morning. Here’s the news:1. Stock index futures point to a sharply lower open on Wall Street today. Asian markets took a beating overnight. European markets are down on the day so far. Global growth prospects and the ongoing crisis of the eurozone seem to be the “macro” concerns.
[credit provider=”AP”] In a meeting that was supposed to yield very little, German Chancellor Angela Merkel and French President Nicolas Sarkozy actually signalled some significant developments in addressing the sovereign debt crisis in the euro zone.On the other hand, neither proposed a systematic solution to the euro’s problems, which could […]
A press conference after that big meeting between German Chancellor Angela Merkel and Nicolas Sarkozy to address the expansion of the European Financial Stability Facility and measures to curb mounting debts in the struggling periphery is just about to take place.
[credit provider=”flickr / jurjen_nl” url=”http://www.flickr.com/photos/jurjen_nl/5271842133/”] The euro was introduced in 2002 as the single currency of the European Union–consolidating the largest trading area in the world and soon rivaling the dollar for global supremacy.But the accumulation of massive and unsustainable deficits and public debt levels in a number of peripheral […]
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