A few hours ago the Greek Prime Minister, George Papandreou, announced that he was canceling his visit to the United States. At around the same time I recevied the following missive from my good friend, Peter Tchir of TF Market Advisors, who is one of the best tea leaf readers in the trading world that I … Read more
I present some basic statistics to highlight the problem in Europe. In short, there exists a deleterious positive feedback loop between overly leveraged banks and their sovereigns in key markets. Exhibit 1: European Banks are overly levered. Spanning 2006 through the latest data point, key European banking systems – France, Germany, and Italy – increased … Read more
Summary: Will Europe become a collection of pawns? Or unify into a great nation? The time of decision approaches. Our news media ignore key aspects of the situation, making the actions of Europe’s leaders look foolish. They’re not. Here we will look at the challenges that lie ahead, and what’s at stake for Europe. In … Read more
Ireland’s Minister for Finance Michael Noonan is an optimistic man. He is also a persistent one. He is optimistic, since he clearly feels that his country’s 85 billion euro IMF/EU programme is going to work as planned, and he is persistent as he patently refuses to let sleeping dogs lie. The dogs in question here … Read more
From Bloomberg — by Scott Hamilton Nouriel Roubini, co-founder and chairman of Roubini Global Economics LLC, said the current slowdown in the world economy has brought forward the timing of a new financial crisis. “I thought a few months ago that the perfect storm would be 2013,” Roubini said in an interview in London today. … Read more
THE 5 percent of Americans with the highest incomes now account for 37 percent of all consumer purchases, according to the latest research from Moody’s Analytics. That should come as no surprise. Our society has become more and more unequal. When so much income goes to the top, the middle class doesn’t have enough purchasing … Read more
For years, I have warned my European students of the fiscal free-rider problem built into the structure of the euro area. My examples have always been fiscally undisciplined peripheral governments seeking political gain by running budget deficits at the expense of their euro partners. Now, though, as the debate unfolds over measures to cope with … Read more
Markets have been crazy this month, but rather than try to wade through all the news, much of which doesn’t seem to have much informational content, I thought I would duck out altogether and instead make a list of things I expect will happen over the next several years. We are so caught up in … Read more
