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Detroit’s default and debt-restructuring plan are precedent-setting in the U.S. municipal market, Moody’s Investors Service said on Monday, because the city is looking to bondholders, as well as labor unions and pensioners, to share the pain. The city on Friday defaulted on a $39.7 million payment on certificates of participation and presented a plan to restructure its finances. “The restructuring plan is unconventional and precedent-setting in the municipal market. It builds a [...] The Eurocrats have decided behind closed doors a massive debt “restructuring” of the southern Euro countries. Even German savers and taxpayers will bleed. The only thing that Europe still holds together, is the will of Merkel. The political elites do not want to think about what happens if something goes wrong during the upcoming parliamentary elections. http://pravdatvcom.wordpress.com/2013/05/29/streng-geheim-europaische-union-plant-gigantischen-schuldenschnitt/ http://translate.google.de/translate?sl=de&tl=en&js=n&prev=_t&hl=de&ie=UTF-8&eotf=1&u=http://pravdatvcom.wordpress.com/2013/05/29/streng-geheim-europaische-union-plant-gigantischen-schuldenschnitt/ The day of reckoning for global total debt – total credit market debt up from $28 trillion in 2001 to $53 trillion in 2012. US consumer debt went up in last few months but largely because of giant amounts of student loan debt taken on. You have to really question what passes for financial analysis these days. One financial show was discussing the recent increase in consumer debt as something positive. [...] by Michael
Have you ever wondered how the big banks make such enormous mountains of money? Well, the truth is that much of it is made by gambling recklessly. If they win on their bets, they become fabulously wealthy. If they lose on their bets, they know that the government will come in and arrange for the banks to be bailed out because they are “too big to fail”. Either they will [...]  Europe Makes Obama Look Good, But That’s Not The Whole Story All the plans to save Greece, Spain et al and keep them in the eurozone are still based on growth recovery prospects which are in turn based on entirely unrealistic assumptions. And every single turn of the way those assumptions have to be recalibrated downwards. Which always leads to more austerity demands, more cuts. And at some point that will no [...] Greek President Carolos Papoulias says the nation’s people have given all they have to drag the country out of its crippling economic crisis, and voiced hope it will end soon. Papoulias says recovery from the crisis, which has made the heavily indebted country dependent on international aid for two years, has to come ‘soon, because you cannot ask more from these people who have given everything’. The president nonetheless expressed his optimism [...] MARK HULBERT: Bear market may begin Will the bull market come to an end on Oct. 9? Oct. 9, for better and for worse, is a big date historically for the stock market. Don’t laugh. It turns out that two of the most prominent market turning points of the last decade occurred on this very date. The first was the beginning of the 2002-2007 bull market, which occurred on Oct. 9, 2002.
Oct. 4 (Bloomberg) — The Cypriot government will seek an 11 billion-euro ($14.2 billion) bailout, 62 percent of gross domestic product, to recapitalize its banks and pay its bills, according to three people with direct knowledge of the matter. The country’s banks, which lost more than 4 billion euros in Greece’s debt restructuring earlier this year, need 5 billion euros of fresh capital, according to Finance Minister Vassos Shiarly, the people said. The [...] From Zero Hedge: Remember when we said two months ago that one way or another the market will need to tumble to enforce the chain of events that lead to Spain demanding the bailout which has long been priced in, and (especially after yesterday’s violent protest) Rajoy handing in his resignation? Well, it’s “another.” After nearly 3 months of suspending reality, in hopes to not “rock the boat” until the U.S. presidential election, [...] California Debt Higher Than Earlier Estimates, a Task Force Reports “They also pointed out many of the same unpaid bills from previous years that the governor had brought to light, like $8 billion in delayed payments to schools and community colleges, and $250 million that was raided from a fund dedicated to transportation and treated as revenue. The task force estimated that the burden of debt totaled at least $167 billion and [...] Athens (MNI) – A growing number of Eurozone countries, led by Germany, are reluctant to release the first two loan tranches of the second bailout package to Greece, as they doubt about Athens’ commitment to reform, according to senior Eurozone officials. The International Monetary Fund is also sceptical, fearing that the baseline scenario of the bailout is no longer realistic and that another debt restructuring may be inevitable, the top-ranking officials [...] by Phoenix Capital Research
The European Crisis is accelerating with every day. Indeed, at this point there’s a new major development (if not more than one) on a daily basis.
Rather than detailing every single news item, I’d rather address the larger concerns. This will better help you understand the larger systemic issues and how this is all likely to play out.
Greece, which we’ve been told was “saved” more than a dozen [...] by Phoenix Capital Research
The European Crisis is accelerating with every day. Indeed, at this point there’s a new major development (if not more than one) on a daily basis.
Rather than detailing every single news item, I’d rather address the larger concerns. This will better help you understand the larger systemic issues and how this is all likely to play out.
Greece, which we’ve been told was “saved” more than a dozen times, [...] Investors are the most pessimistic about the outlook for corporate credit in three years as the global economy shows signs of faltering, with euro-area leaders struggling to contain the sovereign-debt crisis and U.S. unemployment stuck above 8 percent for 41 months. A three-month forecast for a benchmark credit-default swaps index in the U.S. swung negative in July, dropping to -19.1 from 15.2 at the start of April, according a survey by [...] U.S. stocks fell to new depths in Tuesday’s session following a report that European Union officials believe Greece can’t pay what it owes and needs more debt restructuring. The Dow Jones Industrial Average DJIA -1.19% dropped to an intraday low of 12,545.16, and was trading down 168 points, or 1.2%, at 12,553 in recent activity. Likewise, the S&P 500 IndexSPX -1.18% and the Nasdaq Composite IndexCOMP -0.88% also touched fresh lows on the day. The S&P [...] June 21 (Bloomberg) — Lee Buchheit, a partner at Cleary Gottlieb Steen & Hamilton LLP who represented Greece in its debt restructuring, predicts the Eurozone countries will have to double to 1 trillion Euros the money they’ve set aside to solve the sovereign debt crisis continent-wide. Rather than Spain or Italy, tiny Cyprus is likely to be the next European nation to seek a bailout, he tells Bloomberg Law’s Lee [...] According to IIF director Charles Dallara in a Bloomberg interview, “ECB will be insolvent if Greece were to exit the euro. Europe would have to first and foremost recapitalize its central bank.” Excuse me for asking but how would they attempt to do that? Print Euros? Please consider Dallara Says Greek Euro Exit May Exceed 1 Trillion Euros The cost of Greece exiting the euro would be unmanageable and probably exceed the 1 trillion euros ($1.25 [...] I have read countless articles over the past few week stating a belief that Syriza party leader Alexis Tsipras is bluffing in his threat to stay in the euro but default in debts. Is it remotely possible to default and stay in the eurozone? Since this is a multi-part question, let’s first address the question “is this a bluff?” A few snips from Der Spiegel article Tsipras Says Berlin Must Back Down on [...] Simone Foxman
While UBS analysts continue to believe that Greece will not leave the euro, it does face another disturbing reality: the Greek government will likely need a second debt restructuring to keep its debt under control.
Since public sector lending virtually replaced debts held by the private sector in Greece, this time around a default will target the European taxpayer. UBS enumerates the kind of losses he will see in a recent note: The math [...] Christopher Wood of CLSA has a tidy sumup of the Greece situation in the latest version of his GREED & Fear note.
GREED & fear was asked this past week what were the possibilities that stock markets have seen their highs for the year? Four weeks ago GREED & fear had put the odds at “as high as 35%” (see GREED & fear – Fine lines, 19 April 2012). They are now at least 50% [...] Things are getting interesting. Despite earlier headlines that the €5.2 billion EFSF payment to Greece would be made as expected, money which would go to pay European banks and the ECB, it now seems there is more than meets the eye, and the Eurozone will in fact hold back €1 billion of the money until Monday in what is a major escalation in the relationship between the anarchy-controlled country and Europe. EUROZONE HOLDS [...] Spanish Banks Gorging on Sovereign Bonds Shifts Risk to Taxpayer By Yalman Onaran
Spanish, Italian and Portuguese banks are loading up on bonds issued by their own governments, a move that shifts more of the risk of sovereign default to European taxpayers from private creditors.
Holdings of Spanish government debt by lenders based in the country jumped 26 percent in two months, to 220 billion euros ($289 billion) at the end of January, [...] by mybudget360 The biggest market in the world is the European Union and debt problems are still rippling through the global markets. It is apparent with the financial crisis that the global markets are tied together by large banks and interconnected trade. A problem in the largest market should be unsettling and the unemployment rate in the European Union is now at a 15 year high. The global debt problem was never really solved but [...] mybudget360.com The biggest market in the world is the European Union and debt problems are Still Rippling Through The Global Markets. It is apparent with the financial crisis that the global markets are tied together by large banks and interconnected trade. A problem in the largest market should be unsettling and the unemployment rate in the European Union is now at a 15 year high. The Global Debt Problem was never really solved but [...] Spanish regional debt currently stands at 13% of GDP and has surged from EUR60bn in 2006 to over EUR140bn currently. As Credit Suisse points out, the top four regions account for the majority of GDP, two-thirds of regional debt, and, with the exception of Madrid, substantially missed their deficit targets. What is more worrisome is the heavily front-loaded nature of the maturing debt with substantial refinancing needs in the next 2 years and this [...] (Bloomberg) Italy’s Prime Minister Mario Monti warned that Spain could reignite the European debt crisis as euro-area ministers this week prepare a deal to strengthen the region’s financial firewall. Monti pointed to Spain’s struggle to control its finances ahead of a finance ministers meeting in Copenhagen starting on March 30, where officials will seek agreement to raise a 500 billion-euro ($664 billion) ceiling on bailout funding. “It doesn’t take much to recreate risks [...] Despite high-profile measures such as the Greek debt deal and mass pumping of liquidity into the banking system, Europe’s problems have merely been delayed for another day, Willem Buiter, chief economist at Citi , told CNBC. “We have really just paused for breath,” he said. “It (the long-term refinancing operation) really hasn’t solved the problem, and for Europe the worst is still to come.” He also predicted a further “large-scale ECB intervention” later this year or [...] |
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