Money and Finance
- Links
Part 1 of Phil DeMuth's Daily Journal Annual Meeting notes [H/T Will] (LINK) Switzerland becomes first to sell 10-year debt at negative yield (LINK) Switzerland has become the first country to sell benchmark 10-year sovereign debt at a negative yield,...
- Leaving The Hotel Euro? – By Steve Keen
So if Europe’s leaders could just take a step back and realise that their currency isn’t really a currency, they could perhaps convert it into what it most closely resembles – a European SDR – and reduce at least the government-mandated part of...
- Albert Edwards: Spain's Bailout Solves Nothing
Going through Japan's lost decade with Peter Tasker was a prequel to our current plight. One of the key differences he had with consensus was on the banks. Consensus believed Japanese banks were at the apex of Japan's economic woes and the main...
- John Mauldin's Outside The Box: The Pain In Spain
It really does seem to be All Spain All the Time, but there is a reason. Unlike Greece, Spain makes a difference to the eurozone. It may be both too big to allow to fail and too big to save. Last week I came across a very informative 50-page PowerPoint...
- John Mauldin: Kicking The Can Down The Road
How often did we as young kids go down the street kicking a can? “Kicking the can down the road” is a universally understood metaphor that has come to mean not dealing with the problem but putting a band-aid on it, knowing we will have to deal with...
Money and Finance
Hussman Weekly Market Comment: Extraordinary Strains
Just weeks after the enthusiasm over Europe’s plan to plan for the possibility of using the European Stability Mechanism to bail out Spanish banks, the subtle technicality – that direct bailouts would make all of Europe’s citizens subordinate to even the unsecuredbondholders of Spain’s banks – has predictably deflated that enthusiasm. On the growing recognition that addressing Spain’s banking problem will mean taking those banks into receivership, wiping out unsecured debt (much of which unfortunately was sold to unknowing Spanish savers as secure “savings” vehicles), and having the Spanish government sort out the damage, Spanish 10-year debt plunged to new lows last week (see chart below), and Spanish yields hit fresh Euro-crisis highs. At the same time, interest rates in Germany, Finland, Holland, Denmark and Switzerland all moved to negative levels looking 2-5 years out. The world is paying these governments to lend money to them, because the only way to acquire other default-free, non-commodity assets is to hire armored trucks and secure vaults to take delivery of physical currency. This set of conditions is not normal or sustainable, and indicates extreme credit market strains in Europe.
- Links
Part 1 of Phil DeMuth's Daily Journal Annual Meeting notes [H/T Will] (LINK) Switzerland becomes first to sell 10-year debt at negative yield (LINK) Switzerland has become the first country to sell benchmark 10-year sovereign debt at a negative yield,...
- Leaving The Hotel Euro? – By Steve Keen
So if Europe’s leaders could just take a step back and realise that their currency isn’t really a currency, they could perhaps convert it into what it most closely resembles – a European SDR – and reduce at least the government-mandated part of...
- Albert Edwards: Spain's Bailout Solves Nothing
Going through Japan's lost decade with Peter Tasker was a prequel to our current plight. One of the key differences he had with consensus was on the banks. Consensus believed Japanese banks were at the apex of Japan's economic woes and the main...
- John Mauldin's Outside The Box: The Pain In Spain
It really does seem to be All Spain All the Time, but there is a reason. Unlike Greece, Spain makes a difference to the eurozone. It may be both too big to allow to fail and too big to save. Last week I came across a very informative 50-page PowerPoint...
- John Mauldin: Kicking The Can Down The Road
How often did we as young kids go down the street kicking a can? “Kicking the can down the road” is a universally understood metaphor that has come to mean not dealing with the problem but putting a band-aid on it, knowing we will have to deal with...