Tuesday, November 29, 2011

Crisis in Europe Tightens Credit Across the Globe

Businesses Scramble as Credit Tightens in Europe

Breathtaking: World's 25 Most Beautiful Polluted Sunsets: #25 Paris, France

Breathtaking: World's 25 Most Beautiful Polluted Sunsets: #25 Paris, France


Home Prices in 20 U.S. Cities Plunge As Industry Struggles

Residential real estate prices dropped more than forecast in the year ended September, showing the industry at the center of the 2008 financial crisis continues to struggle. READ MORE...

U.K Caught On Wrong Foot As Economic Revelation Take Hold

Osborne Says Debt Challenge Greater Than Expected

Spanish Retail Sales Crash

MADRID—Spain's retail sales fell at their fastest pace in four months in October, the country's national statistics agency INE said Tuesday, the latest indication of a likely late-year contraction in the euro zone's fourth-largest economy.


3 Reasons Europe Is Failing To Act

Despite recent progress toward necessary fiscal reforms in Greece, Italy and Spain, bond investors have been abandoning European markets anddriving up yields. READ MORE...


Ireland Enduring a Long Age of Austerity

Ireland enters its second year in the ungentle embrace of its bailout providers facing a further €3.8 billion ($5 billion) of budget cuts. It is by general acclamation the star pupil among the growing group of euro-zone members that have lost the confidence of bond investors, and the closest thing the currency area has to a success story.  READ MORE...


The euro crisis: Could this be the plan?

Optimism for Euro May Be Shortlived


Five lessons for making a difference in the world

But after nearly four decades of making small business “microloans” to women in the world’s poorest communities with my organization, FINCA International, I have developed a view as to what are the most important ingredients for success in social entrepreneurship READ MORE.


Monday, November 28, 2011

Euro Bounces on Debt Solution Hope

Things are so bad, trader mentality suggesting that things can only get better.

European Economic Outlook and Level of Confidence Deteriates Significantly

PARIS—The global economic outlook has deteriorated significantly, the Organization for Economic Cooperation and Development said Monday, as it urged the European Central Bank to act decisively to prevent the euro-zone sovereign debt crisis from deepening and possibly dragging the U.S. economy to the brink of recession. READ MORE...


Central Banks Ease Most Since 2009 to Avert Contagion

Central banks across five continents are undertaking the broadest reduction in borrowing costs since 2009 to avert a global economic slump stemming from Europe’s sovereign-debt turmoil. READ MORE...


Euro area crisis threatens EU sovereign ratings: Moody's | Reuters

(Reuters) - Moody's Investors Service warned on Monday the rapid escalation of the euro zone sovereign and banking crisis threatens the credit standing of all European government bond ratings. READ MORE


How To Profit From The Euro Paradox

There’s an interesting paradox emerging in the EUR/USD exchange rate. READ MORE...


Sunday, November 27, 2011

Debt Crisis Is a Symptom of Wider Failings

The crisis has only ever been partly about the sustainability of the sovereign debts of Greece, Ireland, Portugal, Italy and Spain. More crucially, it has always been a political crisis, an institutional crisis, a crisis of governance. READ MORE


Euro Zone Moves to Address Monetary and Fiscal Imbalance

BERLIN—Euro-zone countries are weighing a new plan to accelerate the integration of their fiscal policies, people familiar with the matter said, as Europe's leaders race to convince investors they can resolve the region's debt crisis and keep the currency area from fracturing. READ MORE


Euro in Longest Losing Stretch in 18 Months

The euro slid for a fourth week, its longest losing streak versus the dollar in 18 months, as Germany’s struggle with a bond auction signaled Europe’s debt crisis is touching the region’s most fiscally sound nations. READ MORE

U.K. to Guarantee Loans to Small, Midsize Businesses

The U.K. Treasury will guarantee bank lending to small and midsize companies in a bid to reduce the costs of such debt and stimulate lending to a part of the British economy that has struggled to get new funds, according to a person familiar with the matter. READ MORE

Tuesday, November 22, 2011

The Key Players in Europe's Debt Crisis

Profiles, Quotes - Europe's political and financial leaders are looking for ways to stem the euro zone's sovereign debt crisis. VIEW INTERACTIVE

Euro-Zone Consumer Confidence Weakens

LONDON—Consumers in the 17 countries that use the euro became more downbeat about their prospects in November 2011, as the currency bloc's fiscal crisis deepened, weakening the outlook for the economy and the jobs market. READ MORE

What Will Make the Great Financial Crisis Look Like Child's Play?

In 2008, when we were hours away from ATMs running out of money, small businesses being unable to pay their staffs, and schools and hospitals closing down through lack of cash flow, it felt as if the crisis of the century was upon us. But if the world continues on its current path, the historians of the future will say that the great financial collapse of three years ago was simply the trailer for a succession of avoidable crises that eroded popular consent for globalization itself. READ MORE

Euro Bonds: The Pros and Cons, According to the European Commission

A European Commission discussion paper on euro bonds to be released on Wednesday, puts forward three possible approaches for issuing common government bonds in the euro zone.

Monday, November 21, 2011

The Reason Why the Euro in its Current State Will Not Continue

European Credit Crisis Set To Change Political Map

By Grant de Graf

The historic landslide victory by Spain's conservative opposition party, at the election polls, is yet another sign that the credit crisis is changing the European political map. The electorate will not buy into austerity, as has been evident by the riots in Greece and demonstrations in Spain, Portugal and Italy. Running a balanced budget or keeping a deficit in check, may be a practical blueprint to running a healthy economy, but it is not a plan that will provide a quick-fix solution to an economy that is ailing. On the contrary, irrespective of the political ramifications, it will only serve to undermine efforts by a government to restore economic prosperity.

Additionally, the communities in Germany and France will never be satisfied with financing the lunch bars of Europe's poor, which only highlights the inadequacies of the European Union. This is the asset test for the feasibility of such a union: whether tax payers are prepared to pay for the less fortunate in another country that is part of the union. Ultimately, Portugal, Italy, Greece and Spain (PIGS) must exit the Euro for those economies to benefit from a fluctuating exchange rate, to resolve the incongruousness that prevails in those markets. Ireland may survive the cut, due to the strong economic ties that it has with Britain. In the end, a Euro with Germany and France making up 90% of its constituency could survive and provide somewhat of an argument for its sustainability, even though weaknesses to the model still exist.

Conservative Party Victorious in Spanish Election

Spain's Opposition Party Wins Historic Landslide Victory Amid Crisis

Conservatives Ride Crisis to Victory in Spanish Vote

Thursday, November 17, 2011

The European Debt Crisis Gets Complicated

Yields Leap at Spanish Bond Auction

FRANKFURT—The euro-zone debt market brushed off renewed efforts by the European Central Bank to support Italian and Spanish government bonds after new warnings on Spanish debt sustainability.

Greek Deficit Could Exceed 9% This Year

Greek Deficit Could Exceed 9% This Year

The Report That Caused Banks To Tank In The Final Hour Of The Day

This Is The Report That Caused Banks To Tank In The Final Hour Of The Day

18 Biggest Internet Markets In Europe

These Are 18 Biggest Internet Markets In Europe
Today, digital researcher comScore released figures for Europe's Internet usage for September this year.
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The Little Island That is Hurting From The Euro Crisis

You'll Never Guess Which Country The Euro Crisis Has Already Spread To. You think you got problems?
More »

Why America is Falling Apart

Returning To America After A Long Time Abroad, The Changes Hit You In The Head Like A Baseball Bat
More »

The One Solution For Europe That Will Save It

LOOK: There's One Solution For Europe, Everyone Knows What It Is, And If It Doesn't Happen, There Will Be A Collapse.

Von Mises on Expanding Monetary Policy (By Brad DeLong)

"He is not saying that easy money and easy credit sometimes lead to financial crises that cause depressions."

Wednesday, November 16, 2011

Spain Is Going To Need The Kind Of Bailout Italy Got

And in this case neither the banks nor anyone else are winning. On the contrary, there are myriad losers.

For first time, nations mull Greek exit from euro

Ever since the idea of the euro currency really took off in the late 1980s, it has been accepted wisdom that entry was forever. But now, with no less than the leaders of France and Germany conceding that Greece could leave the euro, everyone is scrambling to figure out exactly what would happen.   More »

ECB Punching Into The Wind

Pressure mounted on the European Central Bank to take drastic action to stabilize euro-zone bond markets, as investors shrugged off the bank's limited bond buying and European politicians sparred over the ECB's role in fighting the debt crisis.

Steve Jobs's Gamechanging Plan That Was Never Realized

Steve Jobs's Plan To Go Where Others Had Failed Was Gamechanging

Hungary's Debt Hits Radar Screens

BUDAPEST—Hungary's weakening currency and rising borrowing needs have swollen its debt load to 82% of gross domestic product, overshooting government fiscal targets.

A Glimpse Into the Future Job Market

US Faces 50% Chance of Recession in 2012

The odds of the United States slipping into a double-dip recession are placed at 50 percent, with economists from the Federal Reserve Bank of San Francisco saying the world’s biggest economy might not be able to withstand the rippling effects of Europe’s debt crisis.

Goldman CEO Thinks Economic Recovery “May Have Already Started” | Economy Watch

Lloyd Blankfein, the chief executive officer of Goldman Sachs, said that global economic markets are rebounding faster than expected, and recovery may have surprisingly already started.

“Mysterious” Strength of Euro Currency Puzzles Analysts

Financial analysts and economists from around the world are baffled by how the euro currency has “mysteriously” remained relatively stable all year round, despite the mounting problems that have threatened to break up the eurozone region and its currency.

Euro-Zone Inflation Stable

LONDON—The euro zone's annual inflation rate was stable at 3% in October, unchanged from the previous month's three-year high due to increases in energy costs, official data showed Wednesday.

Where now for Greece, Italy and the euro?

Euro Zone - All Eyes on Italy & Greece [NBC 11-11-2011]

Bruce Bartlett: The Balanced Budget Amendment Delusion

This week the House of Representatives will take up a balanced budget amendment to the Constitution. An idea that has been kicking around for ages, it has never overcome the hurdle of needing a two-thirds approval vote in both houses of Congress. (After which it would not require the president’s signature but would need to be ratified by three-quarters of the states to take effect.)

Middle-Class Areas Shrink as Income Gap Grows, New Report Finds

WASHINGTON — The portion of American families living in middle-income neighborhoods has declined significantly since 1970, according to a new study, as rising income inequality left a growing share of families in neighborhoods that are mostly low-income or mostly affluent.

A State-by-State Look at Long Road to Jobs Recovery

When it comes to jobs, it’s going to take a long time to get over the Great Recession. How long depends on where you live.

Fed’s Evans Seeks To ‘Take New Chances’ on Monetary Policy

The slow-to-recover U.S. economy requires the Federal Reserve to “stretch the boundaries and take new chances” on monetary policy, a key Fed official said Tuesday.

Regulators encouraging banks to game risk models

Two interesting articles were published yesterday discussing how banks in Europe are resorting to clever tricks that artificially raise their loss-absorbing capital to levels specified by regulators.

Voter's Will be Key to Europe's Economic Prospects

To Put Europe Back on Track Try Listening to Voters: Clive Crook

Understanding The Russian Default

The Russian financial crisis and eventual default is often cited as a counterargument to one of the principle MMT ideas that a sovereign currency issuer should not be able to go bankrupt. It’s a complex subject that is worth spending some time on.

The Endgame For The Eurozone Has Begun: Nouriel Roubini

Germany and the ECB have less power over the eurozone's peripheral countries than they seem to believe. If they continue to insist on concentrating all the pain of economic adjustment in the periphery, the monetary union’s slow-developing train wreck will accelerate as peripheral countries default and revert to national currencies.

Krugman Underestimates Economic Effects Of Increased Inequality

We've been studying the work of Paul Krugman a bit lately, as he provides a nice focal point for debate on the current economic situation, he's controversial, and his blog provides a near real-time view of the man at work.

Turmoil Spreads in Europe

Europe's debt troubles on Tuesday spilled over to top-rated nations that had been largely untouched by the crisis—including Austria, the Netherlands, Finland and France—in an ominous sign for European policy makers.

Tuesday, November 15, 2011

EU bans sovereign debt speculation

Eurobond Proposal May be Europe's Saving Grace

STRASBOURG, France—The European Union remains focused on finding a way to expand its bailout fund, but Economics Commissioner Olli Rehn said a new proposal from German economists to counter the euro-zone debt crisis deserves attention.

Recession Fears Haunt Euro Zone

FRANKFURT—The euro-zone economy barely grew in the third quarter despite a temporary bounce in Germany and France, raising fears that the euro bloc may already be sliding into recession as businesses and consumers cut back on spending in response to Europe's escalating debt crisis.

This Is The Reason Bond Yields Are Exploding Across Europe

Bond yields are spiking across Europe, not to mention the spreads between Belgian, French, Spanish, and Italian bonds and German 10-year bunds

5 Big Risks To The Global Economy

Despite the persistent Euro debt crisis coverage, there are other risks that we must bear in mind heading into 2012.

Paul Krugman: The World's Two Most Impressive Economies Have One Thing In Common

In a debate going on tonight in Canada between David Rosenberg, Paul Krugman, Larry Summers, and Ian Bremmer, the attendees were asked what they would do for the Canadian economy.

One Really Bullish Piece Of News From Europe

In Germany, the ZEW economic sentiment survey came in disastrous, which sounds bad except that, as this chart from Reuter's Scotty Barber nicely shows, these extreme levels of negativity are associated with market bottoms

ECB Intervenes: Briefly Brings Italian Yields Under 7%... And Sends French Yields To Fresh Record Highs

ECB is back to playing Whack-a-mole. Just as BTPs seemed poised to collapse to new all time records, and yields reenter the stratosphere, the ECB stepped in aggressively bringing the yield to just under 7%, at 6.996% last, however briefly. The problem, as pointed out previously, is that now the vigilantes will simply focus on those bonds where the ECB can not spoil the party. Such as France. French OATs just hit a fresh all record yield, and low price as technocratic NWO is scrambling to find a third Mario, who just so happens to be is a Goldman and Fed alum, to take over Sarko and head France.

Give Some Credit to Credit-Default Swaps

The birth of the credit-default swap has been well-chronicled. In recent days, though, we may have witnessed the beginning of the end for that controversial insurance policy against financial disasters

Germany, France post solid growth, outlook bleaker

BERLIN/PARIS (Reuters) - Germany and France posted solid growth in the third quarter but those euro zone countries at the sharp end of the debt crisis are faring much worse and analysts expect bleaker times to come across the currency bloc.

UK inflation falls to 5 percent in October

LONDON (AP) — Inflation in Britain fell to 5.0 percent in October from the previous month's 5.2 percent, official figures showed Tuesday, in a sign that it may have peaked.

Jobless in America: OMB Director Jack Lew Makes the Case for Obama’s Jobs Plan

At the Republican presidential economic debate last Wednesday there was a lot of talk about the impact of taxes and regulation on the U.S. economy, but there was very little discussion — or rather specifics -- about the issue that matters most to Americans: Jobs.

Major world economies 'on course for slowdown'

None of the world's major economies will escape a slowdown, the Organisation for Economic Co-operation and Development has warned.

European Union in peril without reform, warns David Cameron

The Prime Minister insisted that leaving the EU was “not in our national interest” but said he felt “very personally” that now was the time for a fundamental reconsideration of European relations.

China vulnerable to asset bubbles, warns IMF

Monday, November 14, 2011

The mathematical law that shows why wealth flows to the 1%

One of the main issues raised by the Occupy demonstrators is the inequitable distribution of wealth. Their slogan focuses on the extreme difference between the richest and the poorest: "We are the 99%," say the banners and T-shirts, pointing out that 1% of the world's population has somehow clawed its way to disproportionate money and power. Time to do something about this unnatural distribution, no?

Chance of 2012 U.S. recession tops 50 percent: Fed paper

(Reuters) - The European debt crisis is raising the odds of a U.S.recession, with economic contraction more likely than not by early 2012, according to research from the San Francisco Federal Reserve Bank.

New York art auctions see record prices

The stunning $61.7 million sale of a painting by American abstract artist Clyfford Still capped a week of record prices at auctions in New York, despite turmoil in the world's financial markets.

Italy at risk of exiting euro zone: Roubini

MOSCOW (Reuters) - Italy's emergency package of fiscal reforms will probably fail to keep its cost of borrowing on financial markets at affordable rates and the country faces the risk of a debt default and departure from the euro zone if more aggressive action is not taken, economist Nouriel Roubini predicted on Saturday.

Europe's Rescue Funds Get Little Traction

Why EU Growth Forecast Fell

Domestic Demand Isn't Ready To Support EU Growth
The European Commission last week published a remarkably grim outlook for the European economy, as we have already noted. The EU’s executive arm sees GDP growth next year of just 0.6%, down from its forecast just six months ago of 1.9%. The 2011 forecast was cut to 1.6% from 1.8%.

Fresh concern over eurozone debt crisis

Italy's political party leaders were locked in talks Sunday to choose a successor to Silvio Berlusconi as Greece prepared to implement painful austerity measures to unlock fresh bailout funds.

Japan economy rebounds from post-quake slump

Europe Heading Towards Bank Nationalization

Euro-Zone Factory Output Falls - WSJ.com

Portugal public workers, soldiers protest against austerity

Portugal public workers, soldiers protest against austerity

Italy easily raises euro3 billion in bond auction

Italy easily raises euro3 billion in bond auction -

Friday, November 11, 2011

Bernanke seeks to reassure vets in weak economy

Selling Bonds for Love

Europe Tries Patriotism, Monthly Jackpots To Sell Bonds

Deficit Cuts Should Be Linked to Unemployment

Robert Reich (Trigger Happy: Why Deficit Cuts Should Be Triggered Only When Unemployment Drops to 5 Percent):

The Fed Urges For More Action

At Fed, louder calls for action on economy -

Economist's View: Paul Krugman: Legends of the Fail

Economist's View: Paul Krugman: Legends of the Fail:

The moral of the story:
Legends of the Fail, by Paul Krugman, Commentary, NY Times: ...Not long ago, European leaders were insisting that Greece could and should stay on the euro while paying its debts in full. Now, with Italy falling off a cliff, it’s hard to see how the euro can survive at all.

An Opinion: Prepare For Europe Collapse Before New Year

It’s official: The European Financial Stability Facility (EFSF) plan announced at the EU summit on October 27th is essentially dead prior to arrival.

Iceland’s New Bank Disaster

Iceland’s New Bank Disaster

"The country is now suffering a second round of economic and financial distress stemming from the collapse of its banking system in October 2008. That crisis caused a huge loss of savings not only for domestic citizens but also for international creditors such as Deutsche Bank, Barclay’s and their institutional clients."

Portugal's Silva Says ECB Must Act More Aggressively

Yen Advances to Strongest Since Intervention on Europe Concerns

Yen Advances to Strongest Since Intervention on Europe Concerns -

The Best Bets For Today's Investment Landscape

The Best Bets For Today's Investment Landscape

BBC News - Today - 'No silver bullet' for eurozone

BBC News - Today - 'No silver bullet' for eurozone:

A Beautiful Chart On What Really Moves The Dollar

A Beautiful Chart On What Really Moves The Dollar: You know this has been the pattern day in and day out, but it's been the pattern for years now.

Eric Schoenberg: The Hypocritical Oath?

Wall Street Journal editor Stephen Moore recently called me a hypocrite because I am a rich American who favors higher taxes on the wealthy yet do not voluntarily pay more to the federal government than I legally owe....  

Rational Irrationality: Keynes vs. Hayek: Debate Diary

Rational Irrationality: Keynes vs. Hayek: Debate Diary : The New Yorker:

The euro crisis: Finito?

SILVIO BERLUSCONI'S promise to resign has done nothing to calm European bond markets. Italian bond yields are soaring today; both the two-year and the ten-year are above 7%. There are rumours that the ECB is in the market and buying heavily. If so, it's not having the desired effect. The ECB can't hope to keep yields reasonable through brute force. It will need to make an expectations-changing announcement. Will it? Italy's yields aren't the only ones rising. Markets are ditching Irish, Spanish, Belgian, and French debt too. The ten-year Treasury is back below 2%... READ MORE: