Tag Archives: Greece

Is Spain’s Check in the Mail?

It’s a big mystery where Spain will get the money for its so-called bailout, given how urgently its banks need a life supporting transfusion. The European Financial Stability Facility or the European Stability Mechanism are mooted, but no-one yet knows which Spain will have to rely on. My suspicion is that the check is “in the mail.”
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Christine Lagarde’s Leona Helmsley Moment

Displaying a shocking lack of empathy for ordinary suffering Greeks, Christine Lagarde, the managing director of the IMF, says she “thinks more of the little kids from a school in a little village in Niger, because they need even more help than the people of Athens,” in an interview in the Guardian. Ordinary Greeks can [...]
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Germany’s Best Option is to Leave the Euro, Says JPMorgan

As the cost of a euro-zone break-up continues to rise exponentially, JPMorgan has concluded that Germany’s best option is to leave the euro. With German taxpayers outraged by the dangerous rise in credit risk resulting from a plethora of backdoor bail-out schemes, carrying on regardless now looks politically suicidal for Chancellor Merkel in the wake her party’s worst state election result in Nordrhein Westfallen since the second world war.
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Germany’s Approaching Götterdämmerung

Germany has been viewed as a safe haven by investors, until now. After all, its export sector has been booming. But investors are beginning to bet against Germany and its manufacturing firms, as a break-up of the euro-zone creeps ever closer. This is because the cost of failure for Germany is growing fast, and the Bundesbank may be trying to force the government’s hand before it digs itself a deeper hole.
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Throwing the Bond Market Out With the Bath Water

The war the EU has declared on the ratings agencies shows why investors should not underestimate its determination to scapegoat “Anglo-Saxon” speculators for the sovereign debt crisis, and reduce “excessive profits” in the financial sector. Even if it means cutting off the EU's nose to spite its face.
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Eurozone Governments May Need To Bail Out Municipalities

A lot has already been written about the risk to municipal bond holders in the U.S., as a growing number of states face severe fiscal problems. But local government debt is an even bigger threat in Europe - where it could force governments to assume the debt, putting further pressure on sovereign bond spreads.
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Europe’s Sovereign Debt Crisis Hasn’t Gone Away

It’s surprising that the banking crises facing Ireland and Portugal, and the wider European banking sector - have not been more contagious. While the risk of Ireland and Portugal defaulting soars, other Europe sovereign bond yields remained fairly flat in the third quarter, and Greece even enjoyed a rally of 140bp to 775bp. This calm is not likely to last long though, before more questions are asked of the banks which own the dodgiest euro-zone debt.
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The IMF Is Turning Into A Monster

It’s been apparent for some time that the IMF is no longer an independent institution but an arm of the European financial elites. With Dominique Strauss-Kahn at the helm when the financial crisis hit, Germany and France have cynically been able to use the IMF for their own ends, dropping ever larger sums into the EU with ever fewer conditions, to protect German and French banks that have huge exposures to the PIIGS. Angering the very same Asian countries that were dictated to by the IMF in 1997, and who are now being asked to pay the bills, and stretching US patience to the limit, it is all likely to end in tears.
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Update: Germany Heads into the Double-Dip Zone

As the Angry Analyst warned, the fiscal austerity being implemented in Greece and the other Club Med countries would soon be felt because Germany has been relying on exports to these countries – not China – for growth. Economic sentiment, as measured by the ZEW institute, collapsed in September. This is particularly significant, because as can be seen from the accompanying chart, it leads the other key indicator produced by the IFO institute. And where this indicator leads, German industrial output is sure to follow.
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What A Wicked Game to Play: The Truth Germany Conspires to Hide

Germany’s politicians are up to their necks in fraudulently covering up the true state of their banking system. Getting serious about cleaning up their banks would mean admitting the financial crisis was not all the fault of Anglo Saxon bankers. The price that Germany and Europe as a whole pays for this disingenuousness is likely to be another full-blown banking crisis. Only this time it will be Chancellor Angela Merkel and her colleagues that end up being cast as the villains.
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