The Markit Manufacturing PMI for the Eurozone hit a 24-month high just above the magical 50 line. While the Services PMI fell just short of 50, it was at 49.6, a level not seen in 18 months. These snapshots of economic function have provided a spike of optimism against the dismal European depression that has been unshakable. There should be [...]
With everything going on in Japan and the US credit markets, Europe has slipped somewhat from the headlines. Part of that is now universal recognition of the durable depression facing the entire continent, no more denials about containment or rapid rebounds. But politicians and policymakers have still maintained that the currency portion of the crisis is over, and that the [...]
Gold prices seem to have settled in around the $1,400 range recently. Whether or not that price is a psychological attractor for both buyers and sellers, there does seem to be some degree of market stability around that level currently. While it is impossible to say how long this illusion of stability will last, there seems to be a confluence [...]
Gold has not behaved like money in decades, rather gold is, for the most of the world, an investment class. We may not like such a development (it is one of the most insidious actions intentionally undertaken by central banks, including Basel rules) but gold is a liability on a bank’s balance sheet complete with a greater-than-zero risk-weighting. That means [...]
Getting into the arcane accounting of central banks is a chore, but, in an uncertain world with every central bank “doing something” at exactly the same time, it is a vital task that requires patience. A lot of patience. Central banks all have familiar financial disclosures and statements. The Fed, ECB, SNB, Bank of England, Bank of Japan, et al, [...]
Could tiny Cyprus with a population of less than 1 million be the undoing of the Euro experiment? It seems surreal to think that such a tiny country, representing less than a quarter percent of Euro GDP could be the trigger for the unraveling of an entire continent's currency but it is often small countries that reveal big problems. Thailand [...]
“According to ABI the value of total loans issued, 1.467 billion euros, represented a 2.5% drop on the December value and was largely the result of the continuing recession in Italy. “Meanwhile, for the current year ABI researchers said their forecasts of a 0.6% contraction in the economy would likely be revised for the worse after a higher than expected [...]
Last November, the Spanish government withdrew €4 billion from the state’s Social Security reserve fund to pay pension obligations. That followed a €3 billion withdrawal just two months before, in September 2012, to cover “unspecified” needs at the Spanish treasury. It was also disclosed that the Social Security fund had allocated over 90%, about €65 billion, into Spanish sovereign debt. [...]
Financial markets in Europe have been a sea of tranquility since last summer. The ECB and Mario Draghi’s promise for unlimited interventions began another quieting period that suppressed bond spreads that has led to the premature “euro crisis is over” sentiment. During that time, the Greek settlement (or third default) on December 10 seemed to have abated the heavy pressure [...]
By Brian Cronin: I am old enough to remember the horrendous conflict in the Congo in the 1960s. The players: Patrice Lumumba, Joseph Kasavubu, Dag Hammarskjold and Moise Tschombe of the breakaway province of Katanga are all still clear memories. What is also clear, unfortunately, is the question asked by a particularly insensitive British TV reporter of Belgian nuns in [...]
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