Spailout fears sent markets and the euro down and bonds up.
The Germans had a lot to say today, most of it about Greece, but they will help with the latest Spanish bailout; Greece is the iffier proposition.
Both Spain and Italy implemented temporary stops on short-selling in their markets, but nothing’s being done about debt swaps and other instruments of the financial black arts. Oh, and Portuguese bonds soared.
Greece was bombarded with German pronouncement and edicts, and a leak story declaring the country wouldn’t give another euro to the country. Japanese banksters gave a mixed verdict on the country, a murky message from the IMF, and the Troika’s back in Athens Tuesday for an austerian checkup. There’ll be a delay in the next europayout and the tourist trade has image problems,
The Italian parties came out for Mario “Three-card” Monti to quell a media rumor, the Spanish recession deepened, the British con game is failing, and Europeans have pulled a lot of cash out of the U.S.
Pretty busty for a Monday, eh?
Spailout threat sends markets down
Shares dropped a lot this morning, recovering a bit by the end of the day.
The reason? Fears that another Spailout may be imminent.
From Adrian Lowery of the London Daily Mail:
The London stock market fell sharply into the red today and the euro hit an 11-year low against the yen as fears mounted that Spain could be on the verge of insolvency.
Markets went into crisis mode after the Spanish region of Murcia yesterday went to the central government for a bailout – following Valencia, which took the same step on Friday.
With fears that more regions will follow and tip Spain into effective bankruptcy, the cost of borrowing for the Spanish government soared and that sent the FTSE 100 index of leading shares plunging 135.4 points or 2.4 per cent to 5,516.4. Shares on Wall Street also tanked on the open, with the Dow Jones industrial average falling 227.1 points or 1.8 per cent to 12,595.5.
The euro also took a hammering overnight, falling to its lowest level versus the yen since November 2000, at 94.37.
With traders anticipating a fully-fledged bailout for Spain, the yield on Spanish 10-year bonds shot up a further 30 basis points to a crisis level of 7.59 per cent and two-year yields were up almost 90 points at 6.64 per cent, while Spain’s Ibex stock index tumbled almost 6 per cent, its worst fall in two years.
Vincent Forest, economist at the Economist Intelligence Unit, said: ‘It is now clear that Spain has entered a self-defeating cycle of austerity and economic contraction.’
Read the rest.
More from Deutsche Presse-Agentur:
The euro dipped below 1.21 dollars Monday for the first time in two years, bottoming out at 1.2082 dollars before inching a little higher on European foreign-exchange markets.
Its low point was half a US cent below its traded value late Friday and fully one cent below Friday’s European Central Bank reference rate, 1.2200 euros, with traders concerned that eurozone politicians have still not fixed the region’s debt problems.
Read the rest.
Robert Wenzel, writing at the libertarian Economic Policy Journal, captures what we suspect lies at the heart of the latest euroexplosion:
The Spanish and Italian stock markets were down by more than 5% this morning.
The rate on Spain’s 10-year government has exploded overnight by 25 basis points reaching 7.52%.
The collapse came on fears that a number of regional governments in Spain will ask the central government for financial support.
The European Central Bank is not stepping in to prop up the Spanish sovereign debt market. The most likely explanation is that it wants to keep the eurozone in crisis mode so that initiatives to push the EZ fiscal and banking sectors on the track towards a closer union maintains an accelerated pace.
Read the rest.
Another move by the Germans
The Germans are desperate to save the euro, and while indications are that they might be willing to exclude Greece from the common currency, Spain’s anoher issue altogether.
And the meetings are already underway.
From Larry Elliott of The Guardian:
Germany’s finance minister, Wolfgang Schäuble, will meet his Spanish counterpart, Luis de Guindos, for crisis talks on Tuesday amid fears that spiralling bond yields in the eurozone’s fourth biggest economy will force it to seek a €300bn bailout from the European Union and the International Monetary Fund.
Interest rates on Spain’s 10-year borrowing rose to 7.59% – the highest since the euro was created – and the stock market in Madrid fell by 5% in morning trading following fresh bad news about the financial health of the country’s regions.
Hints from politicians in Berlin that Germany is preparing the ground for Greece to leave the single currency also unsettled markets, with hefty falls in equity prices on European bonuses and the euro under pressure on the foreign exchanges. London’s FTSE 100 index was down 100 points at midday, at 5551.
Dealers were unimpressed by de Guindos’s claim that Spain would not become the fourth eurozone country to require a formal bailout, after Murcia on Sunday became the second Spanish region to request financial assistance from the government. The Spanish finance minister categorically denied that a bailout was imminent, but media reports from Spain suggest up to six regions could require financial aid, with Catalonia next in line.
Read the rest.
Spain, Italy suspend short-selling
Desperate to end rampant speculation against their economies, the governments of both countries today announced bans on short sales of stocks in their markets.
From Bloomberg’s Jim Brunsden and Alexis Xydias:
Spain and Italy moved to ban short-selling of stocks as prices dropped and the euro traded below its lifetime average against the dollar on concerns about the European Union debt crisis.
Spain’s stock market regulator, the CNMV, said it was banning short selling of all stocks for three months, amid “extreme volatility.” Italy’s Consob said its ban, scheduled to last a week, was introduced on some banking and insurance shares because of the “recent performance of stock markets.”
Today’s bans echoes decisions in August of last year by France, Belgium, Spain and Italy to temporarily ban short selling of financial stocks in an effort to stabilize markets after European banks, including Societe Generale SA (GLE), hit their lowest levels since the credit crisis of 2008.
“I don’t think it is particularly smart but it is to be expected,” said Owen Callan, senior dealer at Danske Bank A/S (DANSKE) in Dublin. “Last time around it didn’t really have any lasting impact. This is trying to avert hedge-fund speculation, but the sell-off is not about speculation. This is not hedge funds trying to bring down the market.”
Read the rest.
The BBC’s Financial Glossary offers a concise definition of short-selling:
A technique used by investors who think the price of an asset, such as shares or oil contracts, will fall. They borrow the asset from another investor and then sell it in the relevant market. The aim is to buy back the asset at a lower price and return it to its owner, pocketing the difference. Also known as shorting.
The move seemed to put a damper on the stock plunge, at least for the day.
From The Guardian:
News of a ban on short selling in Italy and Spain – whether misguided or not – seemed to help haul markets slightly back from the brink.
The FTSE 100 finished 117.90 at 5533.87, while Germany’s Dax dropped 3.18% and France’s Cac closed 2.89% lower.
Italy’s FTSE MIB was down 2.76% and Spain’s Ibex lost 1.1%, but it is worth bearing in mind that both these markets had earlier plunged around 5%.
Greece, with the IMF making a half hearted denial of reports it was not prepared to provide more funding, is down 9.8%.
As for bonds, the Spanish 10 year yield is currently at 7.48% while Italy’s is at 6.33%. A Spanish bond auction tomorrow could prove interesting.
The euro hit $1.2067 against the dollar, its lowest for two years, before recovering to the current $1.2119.
Portugese bonds reverse source, head higher
No surprise: After all, it’s the P in PIIGS.
From Deutsche Presse-Agentur:
Portugal’s borrowing costs rose on Monday, pulled up by a surge in Spanish bond yields, after a months-long downward trend.
The yield for Portuguese 10-year bonds was 10.8 per cent, up from 10.5 per cent on Friday. The yield for five-year bonds rose to 10.2 per cent from 9.8 per cent. The yield for 2-year bonds, however, dropped to 7.5 from 7.6 per cent.
Market pressure had previously eased on Portugal, which has enacted stringent austerity policies after being granted a bailout worth 78 billion euros (94 billion dollars) by the European Union and the International Monetary Fund.
Read the rest.
IMF drops growth forecasts — again
Gee, we wonder why?
From Patrick Smith of Fiscal Times:
In its quarterly economic outlook, the International Monetary Fund has cut its forecast for global economic growth this year to 3.5 percent, down 0.1 percent from April’s number and the fund’s lowest projection in three years. The forecast for the eurozone: a drop of 0.3 percent. The American growth number is 2 percent, down 0.1 percent since April’s outlook.
A day later the International Labor Organization in Geneva reported that the eurozone stands to sacrifice 4.5 million more jobs over the next four years if it stays on its current course. In May, European joblessness hit 17.5 million, a record 11.7 percent, and it is much worse, of course, in the countries suffering the worst economic problems. “It’s not only the eurozone that’s in trouble,” Juan Somavia, the ILO’s director-general, said in releasing the report. “The entire global economy is at risk of contagion.”
What are these two international agencies calling for? As if in unison, they both urged policy makers to forget the status quo and start a big round of growth and job-stimulating policies. In other words, pay more attention to managing demand. The urgency the two agencies attach to this strategy, notably but not only in the European case, is unmistakable. Frightened would not be too strong a term for their sentiments.
Read the rest.
And now, on to Greece. . .
Germany bars further Greek loans
One more indication that Greece isn’t long for the eurozone.
From Spiegel:
Germany and other important international creditors are not prepared to extend further loans to Greece beyond what has already been agreed, German newspaper Süddeutsche Zeitung reported on Monday. In addition, SPIEGEL has learned that the International Monetary Fund (IMF) too has signalled it won’t take part in any additional financing for Greece.
The Süddeutsche Zeitung cited an unnamed German government source as saying it was “inconceivable that Chancellor Angela Merkel would again ask German parliament for approval for a third Greece bailout package.”
Merkel has had difficulty uniting her center-right coalition behind recent bailout decisions in parliamentary votes and would be unwilling to risk a rebellion in a another rescue for Greece, the newspaper reported.
>snip<
SPIEGEL has learned that the troika expects that granting Greece more time would require additional aid of between €10 billion and €50 billion. The troika’s report on Greece’s reform progress could determine whether the country gets its next instalment of €31.5 billion in aid under the second aid package. If it doesn’t get the instalment, Greece risks running out of cash within weeks.
German Finance Minister Wolfgang Schäuble made guarded comments about Greece on Monday. Asked if the country would have to leave the euro if the troika inspectors filed a negative report on its reform progress, Schäuble told German newspaper Bild: “I won’t pre-empt the troika. If there have been delays, Greece must catch up. When the troika submits its report, the Euro Group (of euro-zone finance ministers) will discuss it.”
But even if the next tranche of aid weren’t paid out and the Greek government were forced to declare bankruptcy this autumn, it is unclear what would happen. EU treaties don’t give the bloc the power to evict a country from the single currency union.
Read the rest.
While the treaties don’t give specific power to evict a eurozone member, the economic policies of member states are quite capable of creating conditions that force a member nation to withdraw, and we suspect that’s what’s happening in the case of Greece.
Japanese banksters give mixed signals on Greece
The Nomura Group is one of the world’s largest financial players, and their analysts have just declared that there’s no way Greece can meet the demands imposed by the Troika’s memorandum.
Still, it’s not all bad. They’ve reduced the odds on a Grexit to 45 percent. Back in May, they’d reckoned on a Grexit as “probable.”
From Capital.gr:
According to a Nomura analysis, published today, at this point given fiscal slippage this year, the deeper-than-expected recession (is expecting -7.5% vs. -4.7% officially), the absence of any revenues from privatisations and the request by the Greek government to extend the fiscal targets by two years, the Greek programme is no longer fully financed until 2014 and would require about €30-40bn (depending on the Troika’s assumptions, our figure is approximately €45bn) for extending its programme to 2016.
“If we are correct, the 2020 debt target of 120% of GDP also looks unreachable. As things stand, a political compromise seems to be required by September between the EU and the IMF if Greece’s programme is not to be interrupted”, explains.
According to Nomura’s view, there are still some options that could keep the IMF in, although there are significant risks that the plug could be pulled altogether given the increased zero tolerance on slippage from North European countries.
>snip<
“Following the formation of the Greek government we think the probability of a Greek exit has declined but remains significant (45%)”, said Nomura.
Read the rest.
Oh Lord, not another German dressing down!
And from one of the Usual Suspects, Finance Minister Wolfgang Schäuble.
From Agence France-Presse:
German Finance Minister Wolfgang Schaeuble warned Greece in a newspaper interview Monday that it must redouble efforts to comply with bailout conditions imposed by international creditors.
“If there were delays, Greece must make up for them,” he told the daily Bild.
He declined to predict whether Greece would remain in the eurozone and said he would wait for new findings from the European Union, International Monetary Fund and the European Central Bank — the so-called troika of Greek lenders.
“I will not preempt the troika. When the troika report is ready, the eurogroup will meet,” he said, referring to eurozone finance ministers.
Schaeuble said he saw few parallels between the plight of Greece and fellow debt-mired country Spain, for which the eurogroup approved a bank aid package of up to 100 billion euros ($122 billion) on Friday.
“The causes for the crises in both countries are completely different. Spain’s economy is must more competitive and has a different structure. The country will get back on its feet quickly,” he said.
Read the rest.
And the rare German sweetener
Bankrupt doesn’t mean Grexit, says a prominent Bundestag member hailing from Chancellor Angela “the Iron Maiden” Merkel’s own party, the Christlich Demokratische Union Deutschlands, to give it is full official moniker.
From Ekathemerini:
A senior German lawmaker on Monday said that if Athens were to become insolvent it would not necessarily mean an automatic exit from the eurozone.
Speaking to Dow Jones Newswires, Norbert Barthle, the most senior conservative member of German parliament’s influential budget committee, said that Greek insolvency “does not mean Greece’s exit from the eurozone. I see no tendency for Greece to exit the euro,” he added.
Barthle also said that continued aid for the struggling Greek economy would be dependent on the support of the International Monetary Fund, one of Greece’s three lenders, including the European Commission and the European Central Bank. Barthle was commenting on reports earlier in the day suggesting that the IMF may withdraw further assistance for Greece unless Athens fully implements a painful austerity program agreed with its creditors.
Read the rest.
Hmmm. IMF cooperation, eh?
Consider the latest from Financial Post, focusing on this just-issued pronouncement from IMF Capo de tutti capi and former Sarkozy minister Christine Lagarde:
The IMF is supporting Greece in overcoming its economic difficulties. An IMF mission will start discussions with the country’s authorities on July 24 on how to bring Greece’s economic program, which is supported by IMF financial assistance, back on track.
As Business Insider’s Simon Foxman writes:
That’s a somewhat cryptic response from the international organization, as it does not directly refute reports that the IMF will halt aid payouts.
At the same time, the statement makes clear that the Fund has not yet given up on Greece.
A halt to IMF aid payments would suggest that world leaders see Greece’s situation as hopeless. It would signal tacit approval for a Greek default and likely euro exit, as Greece will not be able to meet its financial commitments to its public creditors if it does not continue to receive aid.
That said, an immediate end to IMF lending seems unlikely. Despite the inefficacy of Greek leadership to adequately impose economic reforms, EU leaders have much to lose from a Greek exit.
Read the rest.
Yet another German adds a dash of bitters
This time it’s Philipp Rösler, the Vice Chancellor and Minister of Economics and Technology and Vietnamese-born chair of the Freie Demokratische Partei [Free Democrats].
And he’s supposed to be a liberal [but then so’s Obama].
From Agence France-Presse:
German Economy Minister Philipp Roesler on Sunday reiterated his doubts about whether debt-mired Greece would be able to stay in the eurozone, saying the “horror” of a potential exit had worn off.
Roesler told ARD public television that Athens’ partners would wait for the progress report of the troika of Greek creditors — the European Union, International Monetary Fund and the European Central Bank.
“Nevertheless I have to say I am more than sceptical,” said Roesler, who is also head of the pro-business Free Democrats (FDP), junior partners in Merkel’s centre-right coalition government.
“Unfortunately it is likely that Greece will not be able to fulfil (the troika’s) requirements. And I say quite clearly, if Greece fails to comply with the requirements that there should be no more payments to Greece.”
He said that an end to further international support might prompt the Greeks to conclude “that it is perhaps smarter to leave the eurozone”.
“I think for many experts, for the FDP, for me, that an exit by Greece from the eurozone lost its horror a long time ago.”
Read the rest.
The Troika trots off to Athens
They’re backkkk. . . . . . . . .
From Valentina Pop of EUobserver:
Officials from the troika of international lenders are back in Athens on Tuesday (24 July as the three-party government struggles to meet the spending cuts demanded in return for the bailout money.
The Greek government is several months behind on promised spending cuts and privatisations. The auditors from the EU commission, European Central Bank and International Monetary Fund are set to draw up a report on how big the shortfall is and whether Greece can still receive the next tranche of €31.5 billion in September.
Without this money, the Greek authorities will not be able to repay outstanding debt to the eurozone central bank, or salaries and pensions in the coming months.
Development minister Costis Hatzidakis on Sunday warned that the two months ahead are “the most critical” and that his country is in a “state of emergency.”
“If the current government fails, the next one will be a government of the drachma,” Hatzidakis told Ethnos daily.
Read the rest.
More from Deutsche Welle:
Greek newspapers are bracing their readers for a visit from the troika of international lenders this week. Officials from the European Union, the International Monetary Fund (IMF) and the European Central Bank (ECB) are preparing to examine Greece’s reform efforts closely and, perhaps, mercilessly.
So far, Athens’ political class has let a number of reforms slide or pushed them back in light of drawn out elections. Now the troika wants to get down to brass tacks – but will have to do so with a coalition government elected on the promise of renegotiating the terms of the Greek bailout – or at least pushing back its deadlines.
Tax breaks for low-income brackets and the middle class are planned if the bailout terms can be renegotiated. But that could be a reasonable goal with or without a complete renegotiation, says Vassilis Korkidis, president of the National Confederation of Hellenic Commerce (ESEE).
“The troika has set savings targets but largely given us a free hand for realizing them. We can use alternative means of reaching those targets that don’t involve constantly raising taxes and fees,” Korkidis argued.
Korkidis also believes that lower taxes could have helped stem the rampant tax evasion in recent years.
Read the rest.
Ah yes, austerity for the poor, tax cuts for the rich. And what sort of naif expects to sell tax cuts on the idea that people will stop evading paying the taxes they owe?
Of course when government is being radically downsized and its workers impoverished, just having people to make sure taxes are paid will itself be a problem.
No money yet, says Troikarch
Yeah, it’s a neologism, but one that feels right, given that the members of the Troika of IMF/EC/ECB have usurped monarchical power over eurozone member states.
Remember also that the European Central Bank, the ECB troikarch, is already refusing Greek bonds as collateral [is that what they mean by “collateral damage”?]
From Athens News:
The next tranche of euro zone aid for is unlikely to be paid before September, the European Commission said on Monday, noting international lenders had to finish an assessment of government-planned reforms that are far behind schedule.
“The decision on the next disbursement will only be taken once the ongoing review is completed,” a Commission spokesman told a regular news briefing.
“Over the last few months, significant delays in programme implementation have occurred due to the double parliamentary elections in the spring,” the spokesman said.
“The Commission is confident that the decision on the next disbursement will be taken in the near future, although it is unlikely to happen before September,” he said.
Read the rest.
And yet another dose of the German sour
It’s coming from the executive secretary [boss] of the Christian Socials, the Bavarian counterpart to Angela Merkel’s Christian Democrats.
And the message is harsh: Start paying salaries in drachmas.
From Athens News:
Greece should start paying half of its pensions and state salaries in drachmas as part of a gradual exit from the euro zone, a leading German conservative was quoted as saying on Monday.
Alexander Dobrindt, general secretary of the Christian Social Union (CSU), the Bavaria-based sister party of Chancellor Angela Merkel’s Christian Democrats (CDU), has long argued that Greece would be better off outside the euro zone.
“With Greece we have reached the end of the road. There must not be any further aid. A country which does not have the will to fulfil the conditions, or is not able to do so, must get a chance outside the euro,” Dobrindt told the daily Die Welt.
Read the rest.
“The end of the road.” Simple, clear, and unambiguous, and coming from the party boss of a state that profited a helluva lot from the party boss of Bavaria, home of Siemens — the industrial titan that made so much money off of Greek contracts they secured with bribes.
Tourism and the fine art of spinning
First, the story from Athens News:
If Greek tourism wants to find a way to get back on its feet, then by the looks of things it’s going to have to focus on the continuing problem of the country’s image abroad.
In an article published in Ethnos newspaper on Sunday, potetnial German tourists are still unsure of what they can expect to find in Greece should they visit for their summer holidays.
“Germans that rent out houses and rooms each year are calling us up, asking us if we need food or medicine for the children, since the German media are saying that there is a severe shortage of both in Greece. These absurdities are more than enough to prevent the majority of tourists in coming here this year”, Vasilis Vallindras, a travel agent from Naxos tells the newspaper.
Greece’s tourism trade is already down by 135.000 German visitors in 2012, according to figures published by market researchers GFK.
Read the rest.
We worked for a year promoting the Southern California tourist trade as community affairs director for the Southern California Visitors council back in the mid-Seventies, so we know the nuances of travelagentspeak.
The agent isn’t talking to convince Germans; he talking to convince Greeks who read a particular publication. And the message is refined, tailored to the Ethnos [Nation] audience, the members of coalition minority party Pasok, those socialists-in-name-only.
And now, across the Adriatic to Italy. . .
Public relations, Italian-style
The politics of sourcing were never clearer than in Italy over the weekend, where an unsourced story in a Milan newspaper triggered a swift display of solidarity.
From EurActiv:
Italy’s divided political parties restated their support for Prime Minister Mario Monti at the weekend, seeking to calm fears of instability that helped drive Rome’s borrowing costs to dangerous levels last week.
Monti’s office dismissed an unsourced report in the Corriere della Sera that he was considering an early election in the autumn and the parties that back his technocrat government ruled out withdrawing their support in parliament.
“There is no risk to the government, given the overall weakness of the international situation. Noone will risk opening a government crisis,” Fabrizio Chicchito, parliamentary leader of the centre-right PDL party, told the daily Il Tempo.
Enrico Letta, deputy leader of the centre-left Democratic Party, also dismissed talk of early elections. “The government is doing it’s work and doing it well,” he told SkyTG24 television.
Markets have reacted sharply to fears of deadlock after elections early next year when Monti’s technocrat administration is due to step down, pushing Italy’s borrowing costs to levels which threaten to spiral out of control.
Read the rest.
Monti was installed by the troika in a political coup d’etat, with no say from the voters. Now the guy he replaced, Silvio “Bunga Bunga” Berlusconi’s on a comeback roll, and we suspect lots of folks are scared of that.
What a world!
Spain sinks deeper into the morass
Currently the hottest burner in the eurokitchen, Spain was slipping deeper into crisis even before the latest flareup.
With an economy already stalling, catastrophic levels of unemployment, and soaring borrowing costs, the numbers just released for the second quarter will probably look good by comparison with the next set of numbers three months from now.
From Deutsche Presse-Agentur:
Spain’s recession deepened in the second quarter, the Bank of Spain said Monday while the country’s borrowing costs rocketed to record levels.
Gross domestic product contracted by 0.4 per cent between April and June, compared to 0.3 per cent in the previous quarter, the central bank said.
Internal demand shrank by as much as 1.2 per cent, but a rise in exports partly made up for it.
The government expects the economy to shrink by 1.5 per cent this year, according to a forecast issued last week. Many analysts, however, expect a contraction of about 2 per cent.
Read the rest.
A losing British confidence game
An interesting story because it reveals the primacy of confidence-building in the sale of the austerian agenda.
But for some strange reason, the coalition government headed by Prime Minister Gordon Brown just can the game going.
We suspect because folks are starting to catch on to the emphasis on the con in confidence.
From The Guardian:
The coalition government’s economic strategy, intended to boost confidence and encourage investment, is having the opposite effect by deterring spending, a thinktank warned on Monday.
The sluggish recovery from recession will see the UK’s long-term GDP growth rate drop to just 1.7% by 2015 – its lowest level since the second world war and the equivalent of £165bn in lost output over 15 years – according to the Institute for Public Policy Research (IPPR).
The report may well provide more food for thought for the chancellor, George Osborne, in advance of Wednesday’s GDP figures which will show whether Britain lifted itself out of double-dip recession in the second quarter of 2012.
>snip<
The International Monetary Fund has downgraded its forecast for UK growth to just 0.2% in 2012 and 1.4% in 2013.
The thinktank said that there needs to be a change in fiscal policy, featuring temporary tax cuts, additional infrastructure spending and further quantitative easing to boost demand and bolster anaemic investment from the private sector.
Read the rest.
Eurozone pulls cash out of U.S. investments
And they’re pulling lots of it out, almost two-thirds of what they held five years ago.
From Financial Times via CNN:
Eurozone banks have retreated dramatically from the US over the five years since the financial crisis began, cutting their assets in the country by more than a third, according to a Financial Times analysis of Federal Reserve data.
Bank failures, asset writedowns and the sale of loans and businesses have sent US assets of eurozone banks tumbling by $540bn from their $1.51tn peak in September 2007.
Eurozone banks have also come under pressure from regulators to boost capital ratios, with many choosing to shrink their US business because dollar funding has been harder to come by.
US assets held by eurozone banks stood at $973bn as of March this year, according to the most recent Fed data, the lowest amount since 2005.
“It’s very pronounced against five years ago,” said Doug Landy, partner and head of the US financial services regulatory practice at law firm Allen & Overy. “It’s more like a return to what the [European] banks looked like 10 or 20 years ago, when their balance sheets were more modest and much more plain vanilla.”
Read the rest.
Not exactly surprising, but lately, with the dollar rising against the euro, there may be some regrets.
