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 Greece, Spain ‘in depression’: Nobel winner Stiglitz AFP - Greece and Spain are in “depression, not recession”, Nobel prize-winning economist Joseph Stiglitz said on Wednesday, blaming tough austerity measures for their downward economic spiral. Stiglitz also maintained that the International Monetary Fund was “a little too optimistic” in its forecast last week that the eurozone economy would shrink by 0.4 percent in 2012 and rise by 0.2 percent next year. “I’m more pessimistic than [...] German lenders will be among the biggest beneficiaries of a Spanish bank bailout, with rescue funds helping to ensure they get paid back in full for poor lending decisions made in the run-up to the financial crisis, and helping politicians in Berlin avoid a politically sensitive bank bailout of their own. German lenders were among Europe’s most profligate before 2008, channelling the country’s savings to the European periphery in search of [...] MADRID (AP) — Spain could ask for a rescue of its troubled banks this weekend when European finance ministers hold an emergency conference call Saturday to discuss its hurting lending sector, a move that would turn the nation into the fourth from the 17-nation eurozone to seek outside help since the continent’s financial crisis erupted two years ago. The ministers will discuss a potential bailout for Spain as pressure mounted on [...] via ifre: Spanish banks may need further long-term loans from the European Central Bank, according to bankers advising such firms, after clients withdrew deposits and some lost money investing in government bonds, leaving them without sufficient funds to pay back debt maturing this year. Lenders in the country took the largest slice of the €1trn loaned out to banks under the ECB’s two three-year longer-term refinancing operations, and currently owe €317bn to the [...] Measures to overhaul Spain‘s ailing banking system are expected to be announced on Friday as the government races to shore up confidence in the economy and head off fears that it will need an international bailout to remain in the eurozone. The emergency measures taken to partly nationalise the country’s fourth largest bank, Bankia, on Wednesday are not regarded as enough to encourage investors to start pouring their money back into [...] From Bloomberg: The good news: China’s government will engineer a soft landing. The bad news: Even a soft landing is painful for industries that have become dependent on the world’s fastest-growing major economy as their main profit engine. Analysts at Deutsche Bank AG, Nomura Holdings Inc. and Daiwa Capital Markets raised forecasts this month for 2012 expansion to as high as 8.6 percent, partly on anticipation of looser monetary policy. The projections, [...] More capital is needed for commercial property borrowers as $1 trillion in debt matures over the next three years, according to Michael Boxer of investment firm Ramius LLC. Refinancing won’t be possible for 77 percent of loans arranged during the height of the property boom, said Boxer, a Ramius partner, in an interview with Bloomberg Television’s Scarlet Fu on “Money Moves.” That will leave a “very big gap,” that needs to [...] by Mike “Mish” Shedlock, Global Economic Trend Analysis Ordos is an inner-Mongolia city with rich natural resources. However, it’s a ghost town with many buildings but few people. Home prices just crashed 62% in a few months. Let’s take this story starting from the beginning. 2011-07-11 A property boom in the Chinese city of Ordos started in 2006, but became stagnant this year [...] Chinese bonds and equities are flashing warning signs that suggest the booming mainland property sector is heading for a bust – a development that would send shockwaves through financial markets worldwide. A sector that was until last year the darling of international investors is turning into a horror show as traders have started to digest evidence that real estate prices are fallin by zh All you wanted to know about why the world is bankrupt in many pretty charts. Some findings. Top 5 riskest countries: Greece Top 10 least risky sovereigns: Norway Most deteriorating countries in the quarter: Belgium Most improved countries in the quarter: Argentina Broad notes: Greece, widening 32% in Q4, tips Venezuela off the top spot as the world’s most risky sovereign. Ireland enters the top five following the bail out the its banking system and a subsequent widening of 35%. by onward-ho 2011 will be the year of the Chinese crunch, scary but temporary. For nations that continue to produce much less than they spend, there are two options. 1) Massive unemployment with a fixed currency or 2) Weakening currency with improved competitiveness The inability of the markets to weaken Ireland’s currency essentially guarantees massive unemployment. According to MarketWatch: In such challenging times, governments tend to fall back to history in search of policy answers. One reason quantitative easing has [...] |
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