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Monthly Archives: May 2012

Germany Must Decide to Ease Back on Austerity or Expect Greece to Leave the Euro

Germany and France wanted austerity and they got it along with a neo nazi presence in Greek parliament. France of course has seen Sarkozy kicked out with a new socialist leader who wants to reject austerity outright.

Germany must now walk on egg shells or else watch the EU zone melt down. Given all the recent spectacle it does not appear Germany has any kid gloves in the box.

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Greece is Bad But Spain Rocks the World; Debt Default Risk Rises

Spain has asked it banks to set aside an additional $45 billion for default risk. The measures to help sure up the banking system has not created confidence at all. It is widely expected by the end of the week Spain will need a international bailout.

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The Euro and the Aussie Dollar Fall on Risk Off Trading

“The euro weakened for an eighth day against the dollar as Greek politicians struggled to form a new government, fueling concern the nation will leave Europe’s currency union.

The 17-nation euro extended its run of losses to the longest since September 2008 as Spain’s 10-year bond yields climbed back above 6 percent. The pound fell for a second day against the dollar as a report showed U.K. retail sales fell the most in more than a year. Australia’s dollar slid to within 0.6 percent of parity with the greenback after Prime Minister Julia Gillard said a planned budget surplus will allow the central bank to cut interest rates.”

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A Greek Tragedy Continues; Sending World Markets into a Tail Spin

European stocks dropped to an almost four-month low as investors awaited a resolution to the political impasse in Greece and as Spanish credit risk surged. U.S. index futures and Asian shares also fell.

Bankia SA led a selloff in Spanish banks as the country’s 10-year bond yield climbed above 6 percent. Kloeckner & Co. and Mediaset SpA (MS) both plunged more than 8 percent after reporting first-quarter results. ING Groep NV and Carlsberg A/S (CARLA) paced advancing shares.

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