Post Tagged with: "Europe"

Bailout bank Monte dei Paschi sub deal three times over-subcribed as Euro hits 3-year high

Bailout bank Monte dei Paschi sub deal three times over-subcribed as Euro hits 3-year high

A subordinated deal in a bank bailed out just a year ago and the currency at a three -year high underscore European investor confidence.

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Accommodative Officials and Synchronized Upturn Drive Markets

Accommodative Officials and Synchronized Upturn Drive Markets

The investment climate is being shaped by two powerful forces.  First is the very accommodative policy stance.  In addition to the accommodative monetary policy, fiscal policy is also supportive. 

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Italian Election–Two Months and Counting

Italian Election–Two Months and Counting

Italy’s election has the potential for some surprises. The Five Star Movement, which is polling first in surveys, has pledged a referendum on the euro if Brussels does not change its fiscal rules. Berlusoni’s Forza Italia and Salvini’s Northern League are critical of the EU and EMU, but rather than jettison the euro, they talk about having a parallel currency.

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The government versus the central bank: monetary policy as the only game in town

The government versus the central bank: monetary policy as the only game in town

The working economic model in North America and Europe is one in which the central bank and the fiscal agents are working at cross-purposes, with the central bank doing the heavy lifting if stimulus is desired.

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European reform and the German model to the rescue

European reform and the German model to the rescue

When we talk about winners and losers in Euroland, the natural question is, “how can you make everybody a winner?”. And I think this is important while Euroland goes through a cyclical upswing since that’s when reforms can actually be the least painful. Will the ‘German Model’ be the one to save Europe?

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The eurozone is fully recovered from the sovereign debt crisis

The eurozone is fully recovered from the sovereign debt crisis

The European PMIs that came out today showed an EU economy that is not just in full recovery mode, but booming. Likely the ECB will reduce its level of accommodation in line with this growth.

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Market jitters and fake liquidity in leveraged loans and high yield

Market jitters and fake liquidity in leveraged loans and high yield

With the US treasury yield curve flattening to almost 60 basis points between 2 and 10-year maturities, we need to ask where are the vulnerabilities in the market if this spate of good news ends. I believe we should look at high yield, leveraged loans and commercial real estate

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The economic acceleration in Europe underpins global growth

The economic acceleration in Europe underpins global growth

Since the EU had been a growth laggard due to the European sovereign debt crisis, the pickup in growth there is encouraging. In particular, Italy deserves mention as it has lagged and is where I believe the battle for the EU’s future will be won. Some thoughts below

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The global economy is hitting its stride right now

The global economy is hitting its stride right now

Most of the recent economic news from developed economies has been good. European growth, in particular, seems to have accelerated. Nothing I see in the economic data causes me worry. So I am cautiously optimistic that this upturn will last at least through 2018. So let me go through the data, my outlook and my concerns.

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The limits of monetary policy in today’s fiat currency world

The limits of monetary policy in today’s fiat currency world

As the Federal Reserve meets at Jackson Hole this week, I thought now would be a good time to talk about the limits of monetary policy – and why monetary policy alone cannot restore robust growth. And as I write this I want to make clear the goal of policy and the assumptions I am making.

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An anecdote on the German housing bubble

An anecdote on the German housing bubble

I don’t know if there is a German housing bubble or even whether there will be one. I do know that we hear a lot about it in the press – the result of zero, even negative, interest rates. So let me give you a little anecdote from my trip to Germany last week.

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How Brexit makes Britain poorer, forcing Carney to stay his hand

How Brexit makes Britain poorer, forcing Carney to stay his hand

The risk in the UK is an inflationary recession. For now, Mark Carney is resisting a rate hike. But how long will the Bank of England hold out? And how long can British consumers keep spending if real wages are falling? Two things would ease this pressure. One is some sort of fiscal support for real wages. The second is the fall in oil prices. As in the US, I see oil prices as key.

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