Sabtu, 07 April 2012

Charles Dallara says no chance of another greek debt restructuring - but did he really mean not before Spain and Italy restructure their debt ?

EUROBLOWN: Fear not ClubMed debtors, for the Elysian fields shall be yours.

There is no chance of another Greek debt restructuring, the managing director of the Institute of International Finance, Charles Dallara, told media folks today. “Greece has entered a path of growth and security” he said.
Lots of other sources said something different. An Austrian Economy Ministry survey, for example, said that Greece ranks last among 14 European countries in attracting new enterprises and investment. And Further cuts will be needed if Greece is to adhere to the midterm fiscal plan it voted for last year, PASOK leader Evangelos Venizelos told Der Spiegel.
Meanwhile, the Greek Parliament is due to vote after Easter about whether political parties should receive 30 million euros in state funding as a lump sum before the elections. What stops this being an excellent idea is that PASOK and ND want the funding to be based on the percentage of  support seen in the lastelection. Support for PASOK has more than halved since then, while backing for New Democracy has fallen by about a third. Anyone spot a motive for legislation here?
Fly leftwards now over the Balearics and on to Iberia. Here you will find that Spain is growing like topsy in a rugged attempt to fulfil the promises recently made for it by Olli Rehn, who by the way is not Spanish at all and so WTF business is it of his? Mish’s GET site has an interesting take on this development, reporting that delinquent real estate companies there were nearly one in five of the total still in business. This doesn’t mean they once appeared in James Dean movies, but rather that they owe a shedload of money to Spanish financial institutions. To be more precise, just over 62 billion euros. Spanish construction firms are in a similar position, their delinquency running at around 18%. A year earlier, it was closer to 12%. So yes, some sectors of the Spanish economy, for example bankruptcy accounting, are growing at near to 50% per annum.
Heading North to the land soon to be my home for five months, the French trade gap yawned even more obviously in February, to €6.398 billions from €5.593 billion in January. Having drilled into the numbers a little, I think there is a very big clue in there: sales of TV satellite dishes and motor vehicles were up. My hunch is that the reality deniers intend to watch more Eurosport, and the rest plan to make a quick getaway. Whether that’s true or not, it’s good to see that re-election hopeful Nicolas Sarkozy is on the case, having announced in mid 2011 what he called “brutal cutting of French public spending largesse”. The annual running deficit total today is thus a mere €70.051 billion, fully 0.7% less than it was for 2011. Go see what they’re doing in Athens, Nico: you could learn something.
But the eurodoomed need not worry, for German daily newspaper Bild reported today (Saturday) that research shows 36% of Germans believe in the afterlife. In fact taking into account the agnostics, only 28% think death is the end.
Hurrah. The Germans are, when all’s said and done, always right about everything, nicht wahr?


Crisis?What crisis?Since the beginning, it seemed almost as if the mega-money injection by the European Central Bank (ECB), the debt crisis successfully ousted from the consciousness of investors.But now not only the trend of declining returns on Spanish and Italian bonds at standstill.The stock exchanges in the third and fourth largest economy in the euro-zone get back to increasing pressure.The infusion trillion by the central bank has eased the markets only superficial, says Nguyen Thu Lan, an analyst atCommerzbank.According to her colleague Christian Schmidt of Helaba is also clear: "The actual problem - the high debt and the weak economy in the southern European countries - has been preserved for us."In fact, the latest economic data from the euro area is not particularly edifying : The debt crisis, unemployment haspushed to its highest level in nearly 15 years.And according to the industry, the service announced in March, shrinking businesses - which points to a recession in the euro-zone.From the perspective of the Munich-based Ifo institute, the crisis-ridden Monetary Union was expected only from the third quarter with growth."It is, therefore, across the board very little reason for joy, 'say analysts at Metzler Bank."Investors are beginning to realize that the euro will continue periphery is under enormous pressure," said Jeremy Stretch, currency strategist at CIBC.

Exchanges in Italy and Spain under pressure

Feel are the newly inflamed concerns about the economic state of Europe, especially in the equity markets, the euro-problem children Spain and Italy: The Madrid benchmark index slipped on Thursday to its lowest level in almost seven months, the Milan index traded as weak as mid-January no more.Year to date balance is also made ​​slight: while theDaxput down with an increase of more than 17 percent, the best quarter for twelve years, the Italian leading index is just a gain of just under six percent.The Spanish market has fallen by 6.5 percent."This is also the cheap money of the ECB did not help much," said one trader.The euro is under pressure.He fell against the dollar on Thursday on a three-week low of $ 1.3055.Against the yen traded at 106.86 yen it at its lowest level since early March.The prospect of a temporarily stable U.S. monetary policy had burdened the common currency already said a dealer.The concerns about a dip in the euro crisis had now done their part.Even against the Swiss franc, the euro is the first time fallen short since the establishment of the course line last September at the 1.20 francs.The ECB had been vaccinated, the Euro zone before Christmas with a first huge injection of cash against a flood of debt crisis.end of February was the second round.Overall, the banks brought in the two rounds more than a trillion euros in cheap loans with a maturity of three years."Of which benefited a significant part Italian and Spanish banks, whose liquidity situation had worsened in the wake of the debt crisis," said the chief economist ofPostbank, Marco Bargel.The banks would have the cash infusion, but also used in order to invest in government bonds to their respective home countries.

Doubts of investors in the reform efforts are justified

As a result, yields tumbled Italian and Spanish bonds, which the fear of an escalation of the crisis was € again become smaller.Ten-year Italian bonds dropped temporarily from only 4.686 percent - 7.5 percent in November.The return of their Spanish counterparts had in February and dropped to 4.615 percent, after they had last year also almost scratched the seven percent mark.But this trend has now stopped: The ten-year bonds pay two countries again well above five percent."The presumption is close, reducing the effect of the two three-year tender from the ECB," says Wolfgang Duwe of the Bremer Landesbank.Stronger move into focus now again cast doubt on the reform efforts of the Southern European countries.The Spanish Prime Minister Marian Rajoy has put together a savings package for 2012 of more than 27 billion euros to free his country from the debt trap.Italy also tried under the new Prime Minister, Mario Monti, and a strict savings and reform program to get back on track.

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