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Is Disaster The New Normal?

Where has the volatility gone in financial markets? Why is the current political situation not causing mayhem? Over the last few weeks I have been developing a theory about the current state of financial markets. The theory isn’t fully fleshed out, despite my efforts, but I hope that by explaining my thinking here I can… » read more

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A Politician Is Not A Country

Today I plan to ask a simple and somewhat rhetorical question. It relates to the recent movements in the eurozone crisis and their relationship to German politics. If you have been following the eurozone crisis, you might have noticed that the pressure on Greece seems to have eased. A few months ago it seemed to… » read more

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Despite having some time on my hands to think, I am still baffled by the current state of the markets. Firstly, despite all the potential risks facing the global economy (Greece, Spain, Italy, the US financial cliff and a slowdown in China) stock markets seem to be surprisingly buoyant. Dare I say rosy…? Who knows… » read more

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There have been a couple of legal challenges made to the European Stability Mechanism. The challenge in Ireland seems to have been brushed aside but there is still, of course, an appeal to be heard. Even so, the progress of the ESM seems to be pretty smooth. Yesterday, however, the German Constitutional Court decided to… » read more

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In my last post (What Is The Cost To Europe Of Individual Actions?) I looked at the apparent movement of money out of Greece and into potentially safer locations. That is, of course, only one form of individual action. This weekend has seen another sort of individual action which has the collective power to cause… » read more

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This week provided a stark reminder that “markets” are not as perfect as we might hope. The double-whammy of the Dutch government falling and Nicolas Sarkozy narrowly losing the first round presidential vote sent markets sharply down. Yet, for those of us that follow politics and policy, weren’t these reasonably predictable events? The polls had… » read more

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The more things change, the more they stay the same. While European finances and economies crumble, the battle rages on between Europe and nation states. Witness this week’s Merkozy agreement (for what it is worth, I love that name!). One of the features of their pact is that there will be no eurobonds. This has… » read more

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A story on the BBC website caught my eye this morning. It seems to suggest that the prospect of a German debt devaluation is appealing to some in the German government. Close followers of the eurozone debt debacle will remember the ‘leak’ from the German team negotiating with Greece some months ago that Greece might… » read more

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Those that know me personally will likely have heard me say that economically the euro is a bad idea and everything will go wrong eventually. I have been saying it for years. Luckily for me, I have never been pressed with a question such as, “How will it go wrong?”. Something tells me that, “A… » read more

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After all that, €1 trillion euros buys a Greek referendum? Is that really the breathing space the world was hoping for? It seems difficult to describe this as anything less than a calamity for the EU, the Euro and especially for Greece. What sort of question should be put to the Greek voters? Do you… » read more

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With yet another summit about the debt crisis looming, is there any hope? A quick scan of the news this morning shows multiple media quoting French Finance Minister Francois Baroin as saying that Europe needs to send a “strong message” about Greece and the Euro. Is that it? A strong message??? The time for a… » read more

Posted by financialguy