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’Post-euro economies, charted
Crystal-ball charts via Mark Cliffe of ING (click to enlarge):
We lay emphasis on “crystal ball” given the long time-frame ING has employed, and the intense difficulty in quantifying the damage which complete break-up would cause to cross-border trade and so on.
The crisis that was always coming
This looks a bit like how 2012 will turn out, doesn’t it?
European countries are at present locked into a severe recession. As things stand, particularly as the economies of the USA and Japan are also faltering,
Failure being devastating does not ensure success
There are only bad or very bad options left for Greece, the occasional fascination with this or that SPV-solution notwithstanding.
Chart du jour to bring home this point:
That’s from a big new Societe Generale note on the crisis which includes its economist Michala Marcussen trying to quantify a ‘disorderly’ Greek default in terms of economic costs.
Depression or double-dip? One of them’s in the eurozone, UBS says
A handy table from Paul Donovan.
The UBS economist notes that recent global growth data has somewhat disappointed investors — prompting concern about a possible double-dip or even depression. To help illustrate the differences from the current economic situation — which Donovan labels an “entirely predictable”
The Great Depression II
Warning: the following note from the normally mild-mannered European Rates Strategy team at RBS is seriously bearish.
They think the yield on 10-year US Treasuries can trade at 2.0-2.5 per cent.
Eat your heart out, Bob Janjuah.
Rosenberg’s ‘Not So Great Depression’
Gluskin Sheff’s David Rosenberg has taken umbrage with the term ‘The Great Recession’ to describe the current global economic malaise.
According to the seasoned economist, it’s quite clear what we experienced last year was not a recession but a depression.
Depression tracking, graphic edition
FT chief economic commentator Martin Wolf draws attention to the work of Barry Eichengreen of the University of California at Berkeley and Kevin O’Rourke of Trinity College, Dublin, in his Wednesday column.
Nouriel’s ‘perfect storm’
So the ubiquitous doomster, Nouriel Roubini, is at it again (the man never stops).
“Don’t believe the optimists”, he warns in his latest article in Forbes. Indeed, with news on Friday that the UK has been warned by the IMF to rein in its public spending,
Optimistically, pessimistic in the US
The Fed’s Beige book is out and it says the speed of the US economy’s contraction is fading amid scattered signs the recession could be nearing an end. So where’s the rally monkey reaction? The DJIA is up about 43 points to 7,963,
Of bonds and stocks and the Weimar Republic
You’d have to be living under a bailout-sized rock not to be aware of the current debate surrounding equities vs corporate bonds.
HSBC has now thrown its hat in the ring, in a 24-page research note entitled “The triumph of the pessimists”,
A mark-to-market history lesson
Republicans’ Thursday testimony on mark-to-market accounting has emerged.
You can read the whole thing here, but we found this bit of particular interest:
Mark-to-market (“fair value”) is a major cause of the current financial disaster.
An 1897 boom and bust retrospective
Rolfe Winkler at Option ARMageddon has done us a favour. He’s typed up an 1897 article on booms and busts that bears an impressive resemblance to the current crisis.
The article was written at the end of the US Long Depression (officially 1873 to 1875,
Absolute suicide watch
We’re thinking of placing certain members of the alternative investment community under special supervision.
Take Niels C Jensen, one of eight leading lights at Absolute Return Partners. He introduces the latest monthly Absolute Return Letter thus:
Deflation is the problem, by George
George Magnus, senior economic advisor at UBS and author, has opinions on a wide range of subjects. In recent months, he generated spirited debate with his book about the economic impact of aging populations (‘The Age of Aging’,
Roubini: End of the laissez faire Anglo-Saxon model of capitalism?
Nouriel Roubini of RGE Monitor (aka prophetic doomsayer extraordinaire) is known for his gloomy outlooks, but his latest missive seems somewhat gloomier than most.
Reading through the commentary you can’t help but feel Roubini is quietly preparing to wave goodbye to the idea of a protracted U-shaped recession for good.
Depression *alert* – international institution edition
One from a major IB economist, one from a major politician and now one from a major global organisation.
Feb. 7 (Bloomberg) — Advanced economies are already in a “depression” and the financial crisis may deepen unless the banking system is fixed,
Depression *alert* – politico edition
We had the first from a major investment bank economist last week, now we have the first from a major politician.
LONDON (AFP) – Prime Minister Gordon Brown acknowledged Wednesday that the world is in a full-blown economic “depression,”
Whatever depression means (an economic love story)
There’s been an interesting exchange between the FT’s Martin Wolf and Morgan Stanley’s Stephen Roach on the subject of depression. After the civil niceties, the blogosphere tit-for-tat goes something like this (our emphasis):
Bankers’ greatest fear
…is unemployment apparently (and not even their own).
From the Wall Street Journal today:
Despite all the pain in the financial sector, bank executives’ biggest fear has yet to materialize. Now,
Depression *alert*
Well, it’s finally happened – a mainstream investment bank calling not just a recession, but a depression. How depressing.
In a note entitled “Some inconvenient truths”, Merrill Lynch’s North American economist David Rosenberg elucidates (emphasis ours):