Here's my summary of the key news over the weekend in 90 seconds at 9 am, including news that fears about a Greek exit from the Euro-zone have returned to haunt markets.
German Finance Minister Wolfgang Schauble ruled out the prospect of a new bailout for Greece, which is stuck in a debt death spiral as its economy contracts under an ever-growing debt-load.
Greece's situation has deteriorated in recent weeks as its GDP contracts and its government struggles to pay its bills.
Bloomberg reported Schauble as saying Germany would not back another bailout and that Greece must not become a 'bottomless pit.'
Meanwhile, Der Spiegel reported the European Central Bank would consider a plan at its September meeting to set limits on bond yields and then buy unlimited amounts of Southern European bonds to enforce those limits.
However, Germany has said it would only support the plan if the countries involved agree to austerity plans to balance their budgets and formally requested bailouts.
This creates the risk of a series of Greek debt-death spirals across Southern Europe in coming years as nations such as Spain and Italy agree to cut government spending and increase taxes to keep the ECB and the Germans happy and keep the Euro together.
September is shaping up as a crucial month for financial markets and the global economy. US Federal Reserve Chairman Ben Bernanke is due to address a conference of central bankers at Jackson Hole in Wyoming on August 31.
Shortly after that the ECB will decide on its stimulus plans, as will the Federal Reserve itself. China is widely believed to be preparing more stimulatory monetary policy over the next six weeks as well.
Meanwhile, the New Zealand dollar was solid around 80.7 USc in morning trade.
FYI to regular readers who may have heard I am leaving Interest.co.nz, I plan to continue contributing 90 seconds at 9 am and Top 10 after my departure from my current full time position of Managing Editor from November 1.
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26 Comments
Yes , yes ..... very sad news indeed ...... so it's true , Bernard ....... we have reached Peak Gloomsterisationalysing ..... all downhill from here ....
.... the fickle weeds of happiness will take over , at interest.co.nz , without your steady hand on the throat of the greenshoots ..... sad , very very sad ...
Gonna lose a fortune on my line of mango flavoured " Anti-Hickeystamine " tablets .... who's gonna need them , now !
Now there's a philanthropic opportunity for you GBH (good bloke hunting). Along the lines of Bill O'Reilly on Fox News. He always does the duo thing with his talking points and hard-hitting interviews, having two interviewees, with opposing views. You could offer your services to Bernard to be his foil, to keep him honest. Live. Hows that? a DUO. Hickey and Hero? The Hickey and Hero Half Hour? ... Howzat?
I'll be continuing to contribute 90 at 9 and Top 10 at Interest.co.nz.
But I'll also be freelancing and setting up a publicly funded website for public interest journalism called www.journalism.org.nz from November 1.
cheers
Bernard
I'll be sure to drop in you there Bernard.......ironic to me that you should go Free...Lance, choose a great steed and don't forget every Don needs his Sancho, eef only to carry hees shiny shield Senor.
I ..uh , guess I feel for GBH in that his nemisis (in spirit only) will no doubt drift from focus.
May your new adventure bring you reward for the wisdom you have aquired......
Peace, out.
None wants to be first !
I’m wonder how many countries should officially declare insolvency, but don’t because of especially severe social/ economic consequences. I guess Greece, Portugal and some eastern countries are unofficially bankrupt since months.
All the best Bernard - please stick to your guns !
"US Federal Reserve Chairman Ben Bernanke is due to address a conference of central bankers at Jackson Hole in Wyoming on August 31."
Now there's a real brains trust. In 2007 none of the Jackson Hole mob had a clue that the financial world was drowning in debt unlike more intelligent people such as Steve Keen, Nouriel Roubini etc. Since then we have expected the very same people who got us into this mess to somehow get us out of it.. Insanity. No doubt Bolly will be going on his last taxpayer funded junket.
In 2007 none of the Jackson Hole mob had a clue that the financial world was drowning in debt
Oh yes they did - the Fed was complicit in so much as they actively cheerled the destruction of the Glass-Steagall Act and thereafter promoted the multi-trillion USD shadow banking system through the prior introduction of non reserve sweep created depo A/Cs. POMO and TOMO injections were the confirmation actions required to give banks confidence to leverage for evermore. Or so they thought. And don't get me started on repurchase agreements.
Since then we have expected the very same people who got us into this mess to somehow get us out of it
Exactly. But it's not just the central bankers - add govt. and mankind in general.
The significant problems we have cannot be solved at the same level of thinking with which we created them - Albert Einstein
Insanity - doing the same thing over and over again and expecting a different result.
Good point - I got the same email - possibly a deed executed in Utrecht designed to restrict the local bozos from owning the whole farm ponzi scheme.
Or a taste of things to come: - when it is clear potential OBR contaminated bank depositors rush to find a new home they cannot anymore.
Hmm....I really dont see the OBR as a biggee, not compared to other things....if there is a rush and I expect there will be, robobank with its farm ponzi exposure is not one for me.. However try finding a bank without significant exposure to every ponzi scheme.....its just a matter of degree.
What is the limit btw?
regards
Stephen
Can you forward that to gareth.vaughan@interest.co.nz with the personal details stripped out?
cheers
Bernard
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