Investors continued their flight from risky assets as the wobbling Greek rescue looked ready to morph into a broader sovereign debt crisis, compounded by fears that a China’s expansion, once seen as inevitable and enduring, is now looking at risk of fading as the officialdom tries to dampen inflation. But the focus on the Greece […]
Read more...By Marshall Auerback, a fund manager and investment strategist and Warren Mosler, a fund manager and co-founder and Distinguished Research Associate of The Center for Full Employment And Price Stability at the University of Missouri in Kansas City. Greece can successfully issue and place new debt at low interest rates. The trick is to insert […]
Read more...Reader Hubert sent along this post, with permission, and the following note: My friend Erwin has published a book out of ten years of columns for the German paper “Die Welt”. He put an Intro in front of it where he lays out why Germany will go down the tubes as everybody else. It is […]
Read more...Sometimes I can miss the blindingly obvious. Like other observers of the widening sovereign debt crisis in Europe, we’ve commented on the fact that the big reason for Germany to work towards a rescue (more likely, the end game is a restructuring) of Greece and other Club Med members at risk is that its own […]
Read more...S&P cut Spain’s long term rating to AA today with a negative outlook. From Bloomberg: S&P said in a statement today that the outlook on Spain is negative, reflecting the chance of a possible further downgrade if the “budgetary position underperforms to a greater extent than we currently anticipate.” Spain was last cut by S&P […]
Read more...I’m mystified as to the cheerleading in some circles on Greece. It is not clear that its €45 billion EU-IMF band-aid will be deployed (among other things, it faces a legal challenge in Germany) and even if it is, it falls well short of Greece’s anticipated needs beyond one year. More important, a successful deal […]
Read more...Reader Francois T sent this by e-mail: It is a well known (self-serving) assumption among business leaders that management is a “special skill” that can be applied to pretty much any field. Alas, this, ahem, skills set seems to bring the bad attitudes also. Problem is, this can become deadly for their costumers when those […]
Read more...By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. A recent poll by Douglas Schoen and Patrick Caddell suggests that swing voters in the US, who are key to the fate of the Democratic Party, care most about three things: reigniting the economy, reducing the deficit and creating jobs. […]
Read more...We met last week with a savvy German investor, one who unlike many of his peers, is well aware of the German bank exposure to Greek and other Club Med debt. He argued that Greece will default within six months. That view might have seemed extreme a week ago, but as Wolfgang Munchau points out […]
Read more...By Satyajit Das, a risk consultant and author of Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives Contained Again… The language is reminiscent of the start of the sub-prime mortgage problems. The problem is “small” and “contained”. Despite the “solution” announced by the European Union (“EU”), the problems of Greece […]
Read more...By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. The Maginot Line, named after French Minister of Defense André Maginot, was a line of defenses which France constructed along its borders with Germany and Italy after suffering appalling damage and casualties during World War I. The French thought they […]
Read more...As expected, Treasury has put off a decision on whether to label China a currency manipulator for a few months, pending negotiations with China. The problem is, however, is that China has been signaling that it is pretty non-negotiable (yes, there has been the occasional conciliatory remark, but they have been notably few and far […]
Read more...A post by Edward Harrison Recently, I wrote a post which examined three different reasons the savings rate in the US could have been falling over the last year. Rebecca Wilder thinks this is a meaningless exercise: Edward Harrison at Credit Writedowns is theorizing why the saving rate is falling when it should be rising, […]
Read more...Independent Strategy’s latest report, “China’s credit bubble: the missing piece in the jigsaw” makes a persuasive case that China’s debt fueled growth model is due for a hard landing, but the timing is uncertain, since the debt is funded internally. China is barely past an episode of dealing with banks chock full of bad loans […]
Read more...By Marshall Auerback, a fund manager and investment strategist who writes for New Deal 2.0. Arthur Conan Doyle’s literary creation, Sherlock Holmes, once solved a murder by noting the dog that didn’t bark. It doesn’t take Holmes’s ingenuity to see that the plan on offer for Greece is clearly a rescue package which doesn’t rescue. […]
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