ECB’s ABS Plan Is More Than ‘Bad Bank”
First ECB head Mario Draghi hinted at discussions of an ABS plan at his press conference. Now we get word from Die Welt that not only is it more than a rumor, it has been discussed by the ECB’s governing council. The German paper also notes that it seems likely that the governing council is .. read more
A Reversal Of (Mis)Fortunes
In the bank meltdown of 2011, the financial sector was in obvious and blatant distress much to the obvious and blatant consternation of every central banker in the modern economic “community”. By September 2011, the US Federal Reserve re-opened (a second time) dollar swaps with the ECB to pass US $ funding on to local .. read more
Europe’s Debtor Prison, Part 2
“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 .. read more
Europe’s Debtor Prison
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 .. read more
Europe Still Ugly, But Ugliness Is Not Just For PIIGS Anymore
Total European roundup from this morning – marginally less bad in the PIIGS, but deterioration into contraction in Germany and especially France. SPAIN, Services PMI 41.2, up from 40.2 “This Further sharp reductions in activity and new orders were recorded in the Spanish service sector during October as the economic crisis in the country persisted. .. read more
Where The Euro Ends
Germany is the key to the euro. The homogenized currency provided them with a labor cost advantage that has been the engine behind the robust export economy (a la China, Japan before 1986, etc). In fact, the original sin of the euro (apart from the very notion of unelected supranational authority) was mispricing the D-mark .. read more
A Welter Of Worries
It is said that bull markets climb a wall of worry but if that were true, then Wall and Broad should look like downtown Pamplona in July with market bears gored, trampled, spindled, mutilated and wrapped around the buttonwood tree. The list of worries for investors seems to grow by the day with slowing Chinese .. read more
Contrarian Alert
There is one thing I know for certain – markets do not like uncertainty. If we measure uncertainty by the level of volatility in the market, we are at the 2nd most uncertain point in the last 7 years. Markets are fairly certain of the following domestic items: US monetary .. read more
