Europe closes sharply lower as the momentum towards a Greek exit builds. Not to be discounted are ideas of EU leaders playing chicken to push Grecians into voting for establishment parties in June. Stoxx 50 -2.7%, Germany -2.3%, France -2.5%, Italy -3.5%, Spain -3.4%, U.K. -2.5%. The euro hits a 2-year low, -0.9% to $1.2565. [View news story]
My view is that the powers would very much prefer the Grecian do the exit voluntarily themselves rather than they dirtying their hands. Bloodless and peaceful too.
France and Germany fail to move the ball forward on the prospect of eurobond issuance at a meeting of their respective finmins today ahead of a EU leader summit on Wednesday. The Germans remain adamant against such a move, and it remains to be seen if Hollande, along with Monti and Rajoy, can shift the center of EU power out of Berlin. [View news story]
That's a really good question!
Just look around, who has got the money?
Only the Germans do but it would be such a tough sell selling those bonds to the Germans themselves. Next in line is the Americans. Maybe they would bring in another Marshall Plan?
France and Germany fail to move the ball forward on the prospect of eurobond issuance at a meeting of their respective finmins today ahead of a EU leader summit on Wednesday. The Germans remain adamant against such a move, and it remains to be seen if Hollande, along with Monti and Rajoy, can shift the center of EU power out of Berlin. [View news story]
As the Chinese saying goes, 'weak nations have no room for diplomacy'. The strong one with a strong hand wins, of course. It would be foolish for the strong one to give up a strong hand voluntarily too.
Expect denials soon, but sources says Angela Merkel suggested to the Greek president the country hold a referendum on continued use of the euro at next month's elections. Syriza: Merkel is treating Greece as a "Protectorate." New Democracy: Merkel proposal "unfortunate." The German Chancellor has managed to unite the feuding Greek parties. [View news story]
Trained as a quantum chemist, Ms. Merkel probably forgets that humans are the most unpredictable and difficult to control. Not taking sides here and just illustrating my point, history lessons are plentiful. Don't underestimate the Greeks!
"The centrist parties will rebound" in June elections, contends a Greek businessman, dismissing polls pointing to a victory for the left-wing Syriza party. Toss in the influence of France's new president, and another Greek rescue just might occur this summer. Whatever one thinks of such schemes, another can-kicking deal is not being priced into markets at the moment. [View news story]
The politicians and the bureaucrats bungled up on this one. They should have let Greek go a year or two ago and cut their losses dead on the track.
Not surprisingly, they fell prey to self-denial and were self blind-folded.
Patrick Chovanec details the "unraveling" of Chinese real estate: April housing starts -14.4% Y/Y, Office starts -21%, Retail starts -18.7%, Land sales -54.7%. Foreign funding of property development -80.8% Y/Y. The only thing holding up real estate investment is a flurry of completions by desperate developers. Once this ends, the hit to GDP may be enough to push the economy into a hard landing. [View news story]
Borrowing your 'not necessarily', U.S. debt in 1990 was a paltry ~$7T unlike the $15.6T now and growing at an 7% annual rate unabated.
Concur that the 'unusual' prosperity of Australia, Brazil, Canada, Russia, and Saudi Arabia may well be a rainbow before that storm.
China's so-called economic ascendancy may also not be ready for prime time after all.
Patrick Chovanec details the "unraveling" of Chinese real estate: April housing starts -14.4% Y/Y, Office starts -21%, Retail starts -18.7%, Land sales -54.7%. Foreign funding of property development -80.8% Y/Y. The only thing holding up real estate investment is a flurry of completions by desperate developers. Once this ends, the hit to GDP may be enough to push the economy into a hard landing. [View news story]
To me at this stage the China today is reminiscent of the United States in the 1929 triggering a worldwide depression.
Embattled Yahoo (YHOO) CEO Scott Thompson will reportedly step down to be replaced temporarily by global media head Ross Levinsohn while Yahoo once again looks for a leader. And Yahoo's five directors, who were set to step down in the summer, will leave the board immediately to make room for Dan Loeb's Third Point nominees, with recently added director Fred Amoroso moving to board chair. [View news story]
Epic tragedy in play; Thompson is not a guy who needs to file a resume; his record of accomplishment preceded him. Now we have a typical corporate coup d'etat and assassination. And YHOO will now be controlled by a hedge fund guy instead of a worker and innovator. Sad, very sad. Very tragic though.
Asia's closer to getting on board the regional trade pact bus, as Japan's Prime Minister Yoshihiko Noda boards a flight to Beijing and says he'll speed up negotiations on a trade structure with China and South Korea. The so-called FTA would match up in size with NAFTA and the EU. [View news story]
The 3 of them just about make everything except maybe airplanes. Now what else they need to buy from us? Besides, they could just barter with each other with their own currencies, and skip the USD.
The U.S.: Stuck In The Slow Lane For How Long? [View article]
Book advance reservation to exotic vacation spots coming into 2013 and 2014; prices then will be so low that you couldn't refuse. I'm serious. No joking!
JPMorgan's (JPM) $2B trading hit is a big blow to the reputation of Jamie Dimon, a CEO whose image was, up until now, almost teflon. Dimon not only survived the financial crisis intact, but actually grew in popularity with the sage guidance of his firm through one of the toughest periods in its history. Unfortunately, as the adage goes, "you're only as good as your last trade" in the finance world. [View news story]
Not to pour salt over wound, do these CEO's earning $100M+ annual salary/bonus actually supervise their lieutenants?
"Revolt was inevitable. It has finally occurred," writes Ambrose Evans-Pritchard. Hollande's victory has shifted the balance of power in Europe as Merkel no longer has enough allies to pursue her austerity agenda. Keep an eye on Italy, where ratification of the fiscal compact is no longer a done deal without sweeteners like eurobonds and a more Fed-like ECB. [View news story]
This development in my view is very bullish at least in the short and perhaps the medium term. Printing will be shifted into overdrive and that means equities will be bubbled up. Great buying opportunity coming up. Powder ready?
S&P 500 futures gap down 1% at the open following Hollande's victory in France and a poor showing by Pasok and New Democracy in Greece (regional elections in Germany didn't go Merkel's way either). German Dax futures -1.3%, France's CAC 40 -1.5%. The euro gaps down 70 pips to $1.3009 vs. the greenback, and £0.8059 vs. sterling, the lowest level since late 2008. [View news story]
Francois Hollande is going to take away 75% of the those earning over $1.3M a year. So, money fleeing Europe, where would they go? They go to America. Great buying opportunity.
Bob Wenzel holds no punches in a speech this week to the NY Fed: "The noose is tightening on your organization, vast amounts of money printing are now required to keep your manipulated economy afloat. It will ultimately result in huge price inflation, or, if you stop printing, another massive economic crash will occur. There is no other way out." [View news story]
Sadly, the Nobel is now a political ploy, mainly I believe is that its endowment is now vested mainly in the United States.
Europe closes sharply lower as the momentum towards a Greek exit builds. Not to be discounted are ideas of EU leaders playing chicken to push Grecians into voting for establishment parties in June. Stoxx 50 -2.7%, Germany -2.3%, France -2.5%, Italy -3.5%, Spain -3.4%, U.K. -2.5%. The euro hits a 2-year low, -0.9% to $1.2565. [View news story]
France and Germany fail to move the ball forward on the prospect of eurobond issuance at a meeting of their respective finmins today ahead of a EU leader summit on Wednesday. The Germans remain adamant against such a move, and it remains to be seen if Hollande, along with Monti and Rajoy, can shift the center of EU power out of Berlin. [View news story]
Just look around, who has got the money?
Only the Germans do but it would be such a tough sell selling those bonds to the Germans themselves. Next in line is the Americans. Maybe they would bring in another Marshall Plan?
France and Germany fail to move the ball forward on the prospect of eurobond issuance at a meeting of their respective finmins today ahead of a EU leader summit on Wednesday. The Germans remain adamant against such a move, and it remains to be seen if Hollande, along with Monti and Rajoy, can shift the center of EU power out of Berlin. [View news story]
Expect denials soon, but sources says Angela Merkel suggested to the Greek president the country hold a referendum on continued use of the euro at next month's elections. Syriza: Merkel is treating Greece as a "Protectorate." New Democracy: Merkel proposal "unfortunate." The German Chancellor has managed to unite the feuding Greek parties. [View news story]
"The centrist parties will rebound" in June elections, contends a Greek businessman, dismissing polls pointing to a victory for the left-wing Syriza party. Toss in the influence of France's new president, and another Greek rescue just might occur this summer. Whatever one thinks of such schemes, another can-kicking deal is not being priced into markets at the moment. [View news story]
Not surprisingly, they fell prey to self-denial and were self blind-folded.
Patrick Chovanec details the "unraveling" of Chinese real estate: April housing starts -14.4% Y/Y, Office starts -21%, Retail starts -18.7%, Land sales -54.7%. Foreign funding of property development -80.8% Y/Y. The only thing holding up real estate investment is a flurry of completions by desperate developers. Once this ends, the hit to GDP may be enough to push the economy into a hard landing. [View news story]
Concur that the 'unusual' prosperity of Australia, Brazil, Canada, Russia, and Saudi Arabia may well be a rainbow before that storm.
China's so-called economic ascendancy may also not be ready for prime time after all.
Patrick Chovanec details the "unraveling" of Chinese real estate: April housing starts -14.4% Y/Y, Office starts -21%, Retail starts -18.7%, Land sales -54.7%. Foreign funding of property development -80.8% Y/Y. The only thing holding up real estate investment is a flurry of completions by desperate developers. Once this ends, the hit to GDP may be enough to push the economy into a hard landing. [View news story]
Embattled Yahoo (YHOO) CEO Scott Thompson will reportedly step down to be replaced temporarily by global media head Ross Levinsohn while Yahoo once again looks for a leader. And Yahoo's five directors, who were set to step down in the summer, will leave the board immediately to make room for Dan Loeb's Third Point nominees, with recently added director Fred Amoroso moving to board chair. [View news story]
The U.S.: Stuck In The Slow Lane For How Long? [View article]
Asia's closer to getting on board the regional trade pact bus, as Japan's Prime Minister Yoshihiko Noda boards a flight to Beijing and says he'll speed up negotiations on a trade structure with China and South Korea. The so-called FTA would match up in size with NAFTA and the EU. [View news story]
Scary...
The U.S.: Stuck In The Slow Lane For How Long? [View article]
JPMorgan's (JPM) $2B trading hit is a big blow to the reputation of Jamie Dimon, a CEO whose image was, up until now, almost teflon. Dimon not only survived the financial crisis intact, but actually grew in popularity with the sage guidance of his firm through one of the toughest periods in its history. Unfortunately, as the adage goes, "you're only as good as your last trade" in the finance world. [View news story]
"Revolt was inevitable. It has finally occurred," writes Ambrose Evans-Pritchard. Hollande's victory has shifted the balance of power in Europe as Merkel no longer has enough allies to pursue her austerity agenda. Keep an eye on Italy, where ratification of the fiscal compact is no longer a done deal without sweeteners like eurobonds and a more Fed-like ECB. [View news story]
S&P 500 futures gap down 1% at the open following Hollande's victory in France and a poor showing by Pasok and New Democracy in Greece (regional elections in Germany didn't go Merkel's way either). German Dax futures -1.3%, France's CAC 40 -1.5%. The euro gaps down 70 pips to $1.3009 vs. the greenback, and £0.8059 vs. sterling, the lowest level since late 2008. [View news story]
Bob Wenzel holds no punches in a speech this week to the NY Fed: "The noose is tightening on your organization, vast amounts of money printing are now required to keep your manipulated economy afloat. It will ultimately result in huge price inflation, or, if you stop printing, another massive economic crash will occur. There is no other way out." [View news story]