July 23, 2012
Ten Major Italian Cities On Verge of Financial Collapse
Read the original post: Ten Major Italian Cities On Verge of Financial Collapse
Hard hitting global and local news
Hard hitting global and local news
Read the original post: Ten Major Italian Cities On Verge of Financial Collapse
El Pais reports Full Spanish Bailout Increasingly Likely "The financial credibility of Spain is close to zero. Fiscal credibility is zero. The political credibility is zero.
The Wall Street Journal discusses Negative Rates in Denmark, Switzerland .
Prepare for Spanish Implosion: Businesses Threaten to Leave Spain Over Tax Hikes; Finance Minister Proposes 56% Tax on Short-Term Financial Transactions Cristobal Montoro, the Spain’s finance minister has made a liquidity destroying proposal to tax short-term financial transactions at an astonishing 56% tax rate. Businesses are already upset over hikes in the VAT and have threatened to leave Spain. Interestingly, in spite of raising taxes elsewhere, the VAT was lowered on the highly subsidized renewable energy sector.
Ambrose Evans-Pritchard has the details in his Telegraph piece, Spanish debt crisis returns as Germany nears bailout fatigue “Demand for Spanish paper is collapsing, even for shorter-dated debt which is very worrying and raises the spectre of Spain losing market access,†said Nicholas Spiro from Spiro Sovereign Strategy. Marchel Alexandrovich from Jefferies Fixed Income said the markets are already bracing for second bigger rescue of around €400bn. “A few more weeks like this and Madrid is going to decide to it has nothing more to lose and call for a full sovereign bail-out,†he said.
View article: Job Losses and Unemployment Skyrocketing in China; Thinner, Taller iPhone 5
Please see Target2 and the ELA (Emergency Liquidity Assistance) program; Reader From Europe Asks "Can You Please Explain Target2?" for a more compete description. There is much misinformation floating around on how Target 2 works, what Germany’s liabilities are, so please click on the above link if you are interested in target 2 balances. The following chart from PIMCO article TARGET2: A Channel for Europe’s Capital Flight shows the capital flight through March
Link: Voters From Both Parties Overwhelmingly Support Big Defense Cuts
The medicine is killing the patient. Increasing the dose is madness. Greece outside the Eurozone may well provide an inspiration for Spain, Portugal, and many other countries.
What Role Does Government Play in Price Inflation?