Might Draghi Know Something?
The rumors of the ECB rate cut had become rather ubiquitous in the past few weeks. Confidence in the European economy has been indirectly proportionate to those rumors, particularly as Germany seems to be heading south again after a short-lived reprieve. France is just a downright mess. But the rate cuts that were just announced .. read more
The Impossible Dream
From friend of Alhambra, Brian Cronin: The first rule in politics is that you never believe anything until it’s officially denied. “The euro is irreversible and is not in danger of collapsing” said ECB president Mario Draghi as the central bank left rates unchanged last week. He said they will come up with more measures .. read more
Fed, ECB Do Nothing, Markets Don’t Crash
There’s an old saying on Wall Street that the market will always act in a way that frustrates the majority of market participants. If that is true, then it goes without saying that the majority must be bearish because this market has had ample opportunities to move lower and steadfastly refuses to do so. Coming .. read more
Drugged By Draghi
Stock markets took off in the middle of last week as Mario Draghi promised to save the Euro: Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough. To the extent that the size of the sovereign premia (borrowing costs) hamper the functioning .. read more
Alhambra Research Note: The Fate of the Euro, and Euro Investors
The Fate of the Euro, and Euro Investors By John L. Chapman, Ph.D. June 17, 2012 Washington, D.C. The world economy is truly suspended on a knife’s edge at the moment, as events in Europe push toward a settlement after years of reckoning postponement. Global stock markets, led by undervalued U.S. equities, would soar in the .. read more
Tactical Update/Macro Themes
The investment committee at Alhambra has been very busy these past 2 weeks analyzing the current world economic situation. Europe sits idle; they are mired in a financial crisis and engrossed in a political chess match. The rest of the world watches the drama and prays for it to end. For, resolution could ignite global .. read more
Have Courage, Mr. Bernanke
Two central bankers this week, Mario Draghi and Ben Bernanke, started what I hope is a trend of placing blame for our economic troubles where it properly belongs – on the politicians who shirk their public responsibilities. Both bankers were expected to provide hints of future monetary policy accommodation and neither delivered the goods. At .. read more
Weekly Economic & Market Review
Markets were roiled last week by the possibility that democracy would break out in Greece – of all places – when George Papandreou floated the idea of holding a referendum on the EU bailout plan. Stocks sold off hard Monday and Tuesday but by the end of the week Papandreou had given up his ridiculous .. read more
