The Financial Times – Lawrence Summers: Look beyond interest rates to get out of the gloom So, what is to be done? Rather than focusing on lowering already epically low rates, governments that enjoy such low borrowing costs can improve their creditworthiness by borrowing more not less. They can also invest in improving their future… Continue reading Two Opposing Views From Harvard On What To Do
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<Click on chart for larger image> Bloomberg.com – Euro-Area Unemployment Reaches Record 11%, Led by Spain The jobless rate in the 17-nation euro zone was at 11 percent in April and March, the European Union’s statistics office in Luxembourg said today. That’s the highest since the data series started in 1995. The March figure was… Continue reading US v EU Unemployment
Comment The table above was constructed right before the payroll report. It shows a snapshot of the lowest 10-year yields on the planet. The US has the 11th lowest 10-year yield. The Swiss yield of 0.48% is the lowest 10-year ever recorded anywhere. So while we will all stop and stare in awe at the… Continue reading Low Yields Everywhere
The Wall Street Journal – Europe’s Top Banker Urges New Union ECB Chief Draghi Calls on Regional Leaders to Establish Centralized Euro-Zone Mechanisms to Protect Financial System European Central Bank President Mario Draghi urged Europe’s political leaders to quickly come up with a longer-term vision for the euro zone including a “banking union” to protect… Continue reading Should Europe Form A Banking Union? Two Views
The Economist – Buttonwood: A contrarian moment Share prices in Europe may have priced in the bad news Ian Harnett of Absolute Strategy Research, a consultancy, says that European equities are trading on a cyclically adjusted price-earnings ratio—a measure that averages profits over seven years—of 11, towards the bottom of its range over the past… Continue reading Is All The Bad News Priced In?
Bloomberg Businessweek – Sentiment Signals S&P 500 Retreat May Not Be Over Sentiment indicators have yet to show signs of extreme pessimism during the Standard & Poor’s 500 Index (SPX)’s retreat since April, suggesting there is still room for bears to push the market lower, according to UBS AG. While the proportion of newsletter writers… Continue reading Where Have All The Bears & Bulls Gone? – An Update
<Click on chart for larger image> <Click on chart for larger image> Reuters – Money flies out of Spain, regions pressured Spaniards alarmed by the dire state of their banks are squirreling money abroad at the fastest rate since records began, figures showed on Thursday, and the credit ratings of eight regions were cut. Spain… Continue reading Spanish Bank Deposits
<Click on chart for larger image> <Click on chart for larger image> City AM – Greek banks see deposits shrink as customers lose confidence TWO of Greece’s biggest banks reported a shrinkage in their deposit bases yesterday as worried consumers continue to withdraw cash from the lenders. Piraeus and National Bank of Greece (NBG) lost deposits… Continue reading Greek Bank Deposits
<Click on chart for larger image> The Financial Times – Dealer and investor talks over liquidity fears The largest Wall Street securities dealers held talks with institutional investors in Boston last week to discuss concerns over shrinking liquidity in the corporate bond market and the rise of electronic trading. People who attended said the unusual… Continue reading No Corporate Bond Liquidity
Reuters – Germany shifts, gives Spain more time on deficit The German government shifted ground on Friday, supporting a European Commission proposal to give Spain more time to reduce its budget deficit, in a sign Berlin is prepared to take a more flexible approach to tackling the euro debt crisis. The European Commission called this… Continue reading Is Germany Softening?