Europe has no time left in its hourglass. It must act now. What it needs to do is to empower the ECB to issue its own (euro)bonds.
The argument for the dollar and against gold is simplistic, and I will evaluate it against the four-stage collapse I see ahead for the Western currencies.
The ECB doesn’t print money and monetize sovereign debt of member states. While they have done some of this, there seems to be political resistance to debt monetization, mainly from Germany and France. They better make sure it continues that way.
For the first time, eurozone leaders were willing to openly acknowledge that a member state might actually leave the euro.
Our take on how the current European Union’s crisis is being played out…
I would be very careful buying Italian CDS as they could redenominate their bonds in LIRE and it wouldn’t be a Credit Event.
El problema de la zona euro es simplemente de un orden de magnitudes demasiado grande como para proporcionar una ayuda real.
Below the surface of the euro area’s public debt and banking crisis lies a balance-of-payments crisis caused by the misalignment of internal real exchange rates. The path of least resistance seems to be an appreciation in creditor countries through the inflation of goods, services and asset prices. But will the electorates in the creditor countries accept a policy of easy money and exchange rate depreciation or push an exit from EMU?
Here is the text of the Draft Terms and Conditions prepared by European Union officials on the current status of the euro region’s bailout fund according to a Bloomberg article. After an initial read we have included our thoughts in bold into the document.
Merkel, Barroso, Lagarde and Papandreu on their way to yet another EU summit – and the bankers waiting for them on the other side of the rainbow…
Merkel, Barroso, Lagarde y Papandreu de camino a su enésima cumbre europea bajo la atenta mirada de los bancos…
La solución a la debacle en la zona euro existe. Pero no la encontraremos hasta que renunciemos a la alquimia en favor del álgebra.