The EFSF must pay 1.86% more than Germany according to Faber on CNBC…..not good folks.
Comments »Black Rock: Liquidity is Vanishing in Europe
Liquidity Concerns Rise as Europe Flounders on Policy Action
China Ups Their U.S. Treasury Holdings
Federal Reserve Raises Margin Requirements For 21 Primary Dealers of CDS
some mortgage securities will require higher margin rates. That is a good thing when trying to portect against counter party risk.
Comments »Bill Gross: We’ve Discovered That The World Had A ‘Flawed Business Model’
Belgium Yields Go Parabolic
Cross Currents: ECB Member Says They Should Not Pick Up the Tab for Euro Crisis
“It’s nowhere in the mandate of the ECB to be the actor by default,” Mersch, who is Banque du Luxembourg governor, said. “Acting by default would create the wrong incentives.”
The ECB has intervened repeatedly to calm the bond market in recent months through buying Greek, Spanish, Irish, Portuguese and Italian bonds as fears about them defaulting on their debt repayments grew.
An increasing number of analysts believe that the ECB may have to step in on a larger scale in coming months, if the euro zone crisis continues to escalate.
“Some of the measures that we have taken are limited in volume and time and can only serve the purpose of increasing the efficiency of the monetary transmission mechanism,” Mersch warned.”
Comments »Fed Leaders Split Over More Stimulus
Many comments have come from fed officials in the last few days and it appears that they are hesitant to create more stimulus.
It may come when we least expect it.
Comments »BofE Sees Growth Stalling Globally; Signals For Stimulus Ahead
The BofE warms of global slowdown if policy makers do not solve the Euro debt problem. They signaled there may be more stimulus to come and the Pound fell while the Gilt yield hit new record lows.
Comments »Contagion Goes from Soft to Hard Core (video)
Why is everyone in the EU suffering yield problems ? Contagion is spreading.
Comments »Fed’s Fisher: Regulators Should Break Up ‘Behemoth’ Banks
“Federal Reserve Bank of Dallas President Richard Fisher said regulators should break up so-called too-big-to-fail financial institutions to curtail the risk they pose to financial stability.
“I believe that too-big-to-fail banks are too-dangerous- to-permit,” Fisher said in the text of remarks given in New York today.
“Downsizing the behemoths over time into institutions that can be prudently managed and regulated across borders is the appropriate policy response. Then, creative destruction can work its wonders in the financial sector, just as it does elsewhere in our economy.”
Regulators in the U.S. and abroad have attempted to address the risks posed by such systemically important financial institutions, and if “properly implemented,” the Dodd-Frank overhaul legislation “might assist in reining in the pernicious threat to financial stability,” Fisher said.
Banks deemed too big to fail must hold as much as 2.5 percentage points in additional capital as part of efforts to prevent another financial crisis, global regulators said in June. The additional capital buffers will range from 1 percentage point to 2.5 percentage points, the Basel Committee on Banking Supervision said.
U.S. regulators are also required under the Dodd-Frank financial overhaul legislation to impose heightened standards on the biggest U.S. banks to curtail systemic risk. Last month, MetLife Inc., the nation’s largest life insurer, said the Fed rejected its plan to increase its dividend and resume share purchases. The insurer said it will try to sell its banking businesses, thus reducing government oversight….”
Comments »Bernanke Secretly Wages War With China
The Big Run: Bond Market Contagion
UK 10 Year Yields At New Lows
Non Euro England is enjoying record low borrowing rates, with 10 year yields now at 2.14%.
Comparatively, France, who has similar debt/GDP as the UK, is tagged with a 3.67% yield on its 10 year.
Comments »Taxes Said to Pay For Wealthy Kids to Enter Charter Schools
“In Silicon Valley, Bullis elementary school accepts one in six kindergarten applicants, offers Chinese and asks families to donate $5,000 per child each year. Parents include Ken Moore, son of Intel Corp.’s co-founder, and Steven Kirsch, inventor of the optical mouse.
Bullis isn’t a high-end private school. It’s a taxpayer- funded, privately run public school, part of the charter-school movement that educates 1.8 million U.S. children. While charters are heralded for offering underprivileged kids an alternative to failing U.S. districts, Bullis gives an admissions edge to residents of parts of Los Altos Hills, where the median home is worth $1 million and household income is $219,000, four times the state average.
“Bullis is a boutique charter school,” said Nancy Gill, a Los Altoseducation consultant who helps parents choose schools. “It could bring a whole new level of inequality to public education.”
Comments »MF Global Debacle Prompts Uncle Sam to Audit All Futures Trading Firms
Samsung Backs Old Man Buffett on European Bank Runs
“In the meantime, a more immediate issue confronting investors is whether we are likely to soon witness a significant run on Italian-based banks. If the answer is yes, then this without question will be the end of the road for the eurozone and will confront the ECB and Germany with an inescapable choice of either providing unlimited support for all eurozone commitments (including deposits) or allowing the disintegration of the euro.
The good news is that as of Sep 2011 (the latest numbers available from the ECB and Bank of Italy), there was no evidence of a “run” on Italian banks. The overall deposits within the system were only down around 1% YoY to €2,154bn and indeed remained relatively stable throughout turbulence of the past 12 months. Does it mean that so long as the ECB partially stabilizes sovereign yields, all is clear? The answer is an unequivocal no for three reasons:….”
Comments »DICK bove: U.S. Banks are Benefiting From Europe’s Crisis
American banks get to be vultures and buy back assets they sold for steep discounts as Europe’s banks make a grab for liquidity.
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