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’Infected – German bunds
Is nothing immune from the sovereign debt woes of the European periphery?
Apparently not.
Now, throughout the sovereign debt crisis in Europe, the bund has been the beneficiary of safe-haven flows coming out of the periphery — Portugal,
The Merkel crash
So what’s really behind the spike in Spanish government bond yields on Monday?
How about this: because of Angela Merkel’s European Stability Mechanism the market is finally being being forced to price in default risk for eurozone countries.
Introducing the European Stability Mechanism (reaction)
The creation of a permanent crisis mechanism — the European Stability Mechanism (ESM) — to safeguard the financial stability of the euro area, perhaps isn’t the resounding victory German chancellor Angela Merkel might have wished for.
Introducing the European Stability Mechanism
Snip, snip, snip.
Merkel gets her way on burden-sharing.
(emphasis throughout ours)
Statement by the Eurogroup
The recent events have demonstrated that financial distress in one Member State can rapidly threaten macro-financial stability of the EU as a whole through variouscontagion channels.
The summer doldrums
The World Cup, Wimbledon and the emergency budget. Market professionals have plenty of excuses to sit on the sidelines at the moment — and they are taking it.
On Tuesday morning, the most actively traded stock on the London market was Stanelco,
German EuroTarp vote, a primer (updated)
A large H/T to Marc Ostwald of Monument Securities for this:
a) The Bundestag (lower house) vote is expected at 10 GMT (11 AM London, 12 PM Berlin), the Bundesrat (upper house) follows and should be completed latest by 12 GMT.
Was naked shorting of German financials really an issue?
We know it’s hard to assess the scale of naked shorting in any particular security.
However, it does make sense to look to the scale of conventional ‘borrowed-stock’ shorting activity for an indication.
Witz des Tages
That’s joke du jour for non-Germanaphone readers. And here it is:
Related links:
Zwei linke Füße – FT Alphaville
Quants back England to win World Cup – FT
Germany’s plan to deal with budget transgressors
Forget the short-selling ban, Germany’s plan to tackle budget transgressors (as outlined in Wednesday’s Handelsblatt), is what we should be REALLY worried about, according to RBS.
Before we get to that,
Zwei linke Füße
That’s two left feet, for non-Germanophone readers.
In what’s probably an effort to justify German’s short selling ban, Chancellor Angela Merkel has been getting all apocalyptic about the euro on Wednesday morning.
Now, about those DEM rumours – redux
On Thursday we poured scorn on the bizarre rumour that German officials have already prepared for a “plan B” contingency involving the return of the Deutsche Mark as soon as this weekend.
Although it might not have been as far fetched as we thought…
Towards a United States of Europe
From Berlin, via Reuters, on Monday morning:
GERMANY’S MERKEL SAYS WE MUST ADDRESS THE ROOT OF THE PROBLEM, THAT MEANS CONSOLIDATING BUDGETS
EURO GERMANY’S MERKEL SAYS THIS PACKAGE IS NECESSARY TO
Stopping the wolfpack (updated)
While we await details of the EU’s emergency lending mechanism and loan guarantee package for troubled countries – a statement is expected around 21.00 hrs (GMT) – here are the observations of Swedish Finance Minister Anders Borg…
Merkel’s calls for ‘orderly insolvencies’ threaten more disorder
There’s nothing quite like a crisis to expose the underlying cracks and fissures in both political systems and regulatory frameworks.
According to Bloomberg reports, Germany’s coalition government,
A pat on the back for international policymakers
A pat on the back from themselves, that is.
A statement out of the OECD in Paris on Wednesday:
Joint press release by Federal Chancellor Angela Merkel, OECD Secretary-General Angel Gurría, WTO Director-General Pascal Lamy,
My Big Fat Greek bailout
At last, this much overused pun is justified.
Flashes from Reuters:
GERMAN GREENS MP TRITTIN SAYS IMF CHIEF STRAUSS-KAHN SAYS GREEK AID PACKAGE WORTH 100-120 BLN EUROS OVER 3 YEARS
GERMAN MP TRITTIN
It is / isn’t Greek IMF bailout decision day
Neither the IMF, Greece, or European leaders have confirmed a deal to resolve Greece’s debt crisis ahead of Thursday’s European Union summit. Greece needs some €20bn of funding available over the next 18 months or no.
“I urge you not to become a US bailout nation”
Outstanding.
Vince ‘I would like to recall the earlier press release’ Stanzione hasn’t just got something to say about sterling. The self-styled ‘controversial trader and investment coach’ has also got some advice for the German chancellor,
CDS report: “Reaching the bottom of the slump is not when you start with exit strategies”
This CDS report was written by Markit’s Gavan Nolan
“Reaching the bottom of the slump is not when you start with exit strategies. We need to choose a point when we’ve already got some way out of the trough”.
Merkel attacks central banks
Angela Merkel, Germany’s chancellor, on Tuesday voiced surprisingly strong criticism of the world’s key central banks suggesting that the unconventional monetary policies of the Federal Reserve, Bank of England and the ECB could aggravate rather than ease the economic crisis.
Germany to ban excessive borrowing
Germany will change its constitution to ban excessive public borrowing and impose strict new rules to ensure the extra debt created by its latest fiscal stimulus package is paid off as soon as possible,
Merkel hints at increase in stimulus
Angela Merkel, the German chancellor, raised European hopes on Thursday that Berlin might go beyond its €12bn national stimulus package already announced, despite this week’s outspoken attack on the UK’s plans by Peer Steinbrück,
US economy deteriorates for consumers
Conditions in the US economy deteriorated for consumers and businesses in the month to July 14, as the Fed warned that “the pace of economic activity slowed somewhat since the last report [on June 11]”.