All Entries Tagged With: "Spain"
Can Europe Solve Its Crisis?
Over the weekend, Europe’s leaders met at a summit in yet another effort to create a solution to the ongoing crisis in the eurozone. At this point, the eurozone has been raging for months. Over the summer, the situation intensified, and then became even worse when Belgian bank Dexia was nationalized. Some new revelations have [...]
IMF Predicts Slower Growth, Lower Inflation, and a Weak Housing Market
On Tuesday, the International Monetary Fund (IMF) released a report regarding the global economy. The report was particularly bearish. “The global economy has entered a dangerous new phase,” stated the IMF’s chief economist Oliver Blanchard. “Markets have clearly become more skeptical about the ability of many countries to stabilize their public debt. Fear of the [...]
Will The Short Sale Ever Return to Europe?
On Thursday last week, several countries in the European Union (EU) announced that they were extending the ban on the short sales of financial stocks. Belgium, Italy, France and Spain had imposed bans earlier in the month. European markets came under heavy selling pressure late in July. Although many cited the debt ceiling extension as [...]
Germany Split Over The Creation of Eurobonds
Over the previous two weeks, speculation has been mounting over the creation of European bonds backed by all members of the eurozone. In theory, this could solve the ongoing European debt crisis: PIIGS would have their debt obligations tied to the more powerful, fiscally sound “core” members. Under this scenario, the ongoing attack on the [...]
The Rise of Europe’s Right-Wing Could Foreshadow the Euro’s Future
On Friday, ratings agency Moody’s (NYSE: MCO) placed Spain’s credit rating on review for possible downgrade. Spain currently maintains an AA2 rating at Moody’s, which is far better than other nations like Greece, but is still grouped in the PIIGS moniker. Although probably unrelated, following the announcement by Moody’s, Spain’s President Jose Luis Zapatero called [...]
Euro Summit is Banking on Financial Contagion Solution to Save Europe
On Thursday, the EUR/USD pair rallied sharply—spiking over 1%—as news broke that eurozone leaders had reached a tentative agreement to solve the Greek debt crisis. Rather than merely extend additional loans to the troubled nation, the new plan would aim to strengthen Greece at the core—channeling money into Greece’s economy in an effort to rebuild [...]
IMF Memo to Spain: Watch Your Step
The International Monetary Fund (IMF) has issued a statement on the reform measures implemented by Spain as that country grapples with its sovereign debt issues. While this is not enough to push the situation in Greece out of the headlines quite yet, it is worth a brief look. The statement reveals both the progress Spain [...]
Strong Euro, Weak Eurozone
Nobel laureate and New York Times columnist Paul Krugman wrote a recent blog post explaining why the euro continues to exhibit strength while the eurozone itself is in serious trouble. The short answer is, “It’s the interest rates, stupid.” Krugman puts it more elegantly, but that’s the nub of the answer. The strong countries at [...]
Is the ECB Europe’s Real “Bad” Bank?
The sovereign debt of the eurozone’s periphery, especially Greece, Ireland, Portugal, and Spain, has been pretty well documented as a cause for significant concern to the world’s financial system. Not so well understood is the danger to the system from the assets the European Central Bank has added to its balance sheet. Germany’s Der Speigel [...]
Sovereign Debt Woes Spread in Eurozone
Fears of contagion in Europe are mounting following a downgrade of Italy’s credit rating from ‘stable’ to ‘negative’ by Standard & Poor’s. The country did maintain its A-rated long-term debt and its ‘A1+’ short-term debt rating, but there are worries about political gridlock following election losses by Italy’s ruling party. While the ratings change is [...]
