Showing posts with label Mondiala Banca MondialaFMI Bank of England banks Basa Press. Show all posts
Sunday, July 22, 2018
Friday, October 30, 2015
"We are open to a whole menu of monetary policy instruments," Mr Draghi said, noting that further interest rate cuts had been discussed. "The discussion was wide open."" Sounds like he has Yellen's Disease, but printing money is always the solution for the left to fix fiscal abnormalities... “The ECB will almost certainly be delivering an early Christmas present this year,” said Nick Kounis, the head of markets and macro research at investment bank ABN Amro. Draghi is an enthusiastic proponent of “forward guidance”, the strategy of sending strong verbal policy signals in order to shift financial markets – in this case, driving down the euro. His dramatic pledge in the summer of 2012 – in the middle of the Greek debt crisis – that the ECB would do “whatever it takes” to save the single currency helped to reassure panic-stricken investors. Jeremy Cook, the chief economist of international payments company World First, said ECB policymakers were likely to have become increasingly concerned in recent weeks about the strengthening of the currency, which makes eurozone goods less competitive on international markets. “Draghi and the executive council couldn’t have been clearer that additional policy easing was coming if they’d had the words ‘sell the euro’ tattooed on their faces,” he said. Euro area GDP rose 0.4% in the second quarter of 2015, a slight slowdown from 0.5% growth in the previous quarter. We must all call attention to the salient fact that the EU, US, UK and Japan are riding along using debt to sustain their economies. QE and other nostrums directly related to money printing thus monetizing the debt must be clearly understood...A number of reasons they do this:
1) kicking the can in the hope some visionary guides us to economic enlightenment before the global economy implodes in it's entirety
2) this is simply a response to the US' decision not to raise rates as well as the Yuan's devaluation a number of months ago. Given the Euro depends on exports, a weaker Euro will prop up the currency. Make no mistake, we're at war, a currency war
3) this is also being pushed as a solution by those who seek to gain the most, ie banks and investment funds. Governments in the aforementioned states are too large and expensive, too inefficient, too prone to spend without consideration of how the debt is affected by the deficits and too prone to call for more taxation in every case where they run short of money.So now it is completely safe to say that the relationship between stocks and underlying fundamentals now NO LONGER EXISTS.
No if's, no maybe's, just absolute fact. Stock valuations are entire fiction. The entire purpose of the Fed / ECB / BoE/ BoJ is to make something levitate. What they cannot do is make anyone with a brain believe a word of it. It is almost game over, pension fund over, banking system over, savings over. Quantitative easing is not the answer, reality is the answer. Let's just accept that our standard of living is going to fall. QE will delay it and make matters worse, facing reality on the other hand will ensure that the fall in our standard of living will happen now, but won't be as painful in the future when compared to the QE option. The reality is - Too much debt
One of the three following options are open to the central planners.
1. QE for as long as possible - outcome - Dreadful economic future.
2. Attempt to reduce the deficit to zero by the end of this Parliament. - outcome - significant reduction of our standard of living and civil unrest.
3. Attempt to reduce the deficit over a long period of time, bearing in mind the paradox of thrift will make this a slow and relatively painful process, but from my point of view, this is the best option open to us. A tipping point passed many years ago, we needed brave politicians dealing with the debt issue. However. I can understand why politicians did not grasp the nettle, a fickle public would not vote for them, after all, who wants harsh reality.
Wednesday, August 27, 2014
The head of the International Monetary Fund, Christine Lagarde, was placed under formal investigation by French magistrates on Wednesday for her alleged role in a long-running political fraud case, a source close to the former French finance minister said.
The source said Lagarde, who was earlier questioned by magistrates in Paris under her existing status as a witness, believed the decision to investigate her for alleged negligence was unfounded and would appeal against it. A French judiciary source also confirmed the step. In French law, magistrates place someone under formal investigation when they believe there are indications of wrongdoing, but that does not always lead to a trial.
The inquiry into the tycoon Bernard Tapie has embroiled several of former president Nicolas Sarkozy's cabinet members, including Lagarde. Tapie, who supported Sarkozy in the last two elections, was awarded €403m in a 2008 arbitration payment under Sarkozy's presidency to settle a dispute with the now defunct, state-owned bank Credit Lyonnais over a 1993 share sale. Lagarde was finance minister at the time.
Saturday, October 26, 2013
The European Central Bank has launched a push to strengthen the eurozone's banking system and keep troubled financial institutions from holding back the region's economy.
The bank announced Wednesday that a year-long review of 130 of Europe's biggest banks will begin next month. The asset review is an effort to check for hidden bank losses such as loans that are unlikely to be repaid. That will be followed by a stress test conducted along with the European Banking Authority that would simulate bank losses in a crisis. At the end, banks could be pushed to repair their finances by raising more capital.
Troubled finances at some banks have held back the economy of the 17 EU countries that use the euro by making it harder for them to lend to businesses. Banks that have shaky assets - such as bad loans - may be unable to find cash to lend to businesses that need credit to expand their operations. The review is also aimed at restoring confidence in bank finances so they can borrow money more cheaply themselves - and rely less on the ECB's emergency credit offerings.
The asset review is a test of the ECB's credibility. Previous stress tests carried out by the European Banking Authority clcomplicated because Europe does not have a single resolution authority that could carry out the restructuring of troubled banks. European leaders are still debating how to set up such an authority. For now that job remains in the hands of national authorities who have been seen as too reluctant to take tough measures against their home banks ...German banks were "already intensively preparing for the comprehensive assessment"Haha, or in real words, walls of bluff and bluster are hurriedly being erected to hide the massive black holes of the overleveraged biggest german banks. Hopefully the proximity of the ECB in Frankfurt will provide assistance with the fraud.
At least they have money coming in from the Irish and Greek Taxpayer to pay for the credit scams they inflicted on those countries though.eared many banks - only to see some of them rescuing soon after.
Economists say Europe's delay in dealing with bank troubles has held back the eurozone economy. Officials in the United States, by contrast, moved far quicker in the wake of the 2008 collapse of investment bank Lehman Brothers.
The asset review and stress test are preliminary to the ECB taking over as the European Union's banking supervisor next year. The single supervisor is part of a broader effort to strengthen the banking system and prevent a repeat of the debt problems afflicting countries such as Greece and Portugal.
Tuesday, April 23, 2013
The Eurozone is in recession because it is an exporting bloc and its' key markets (not least countries like Britain) are just not buying. You would hardly know it from reading the British press but the Eurozone as a whole still has a TRADE SURPLUS with the rest of the world. When was the last time that Britain ran a trade surplus? The 1980's? Yet this article (and hundreds like it) paint a picture of a frustrated UK economy, raring to go, just waiting for an enfeebled Eurozone to buck its ideas up. It’s back-to-front new-speak garbage - the Eurozone will be out of recession the moment its customer countries (like Britain) start buying again.
You can’t suddenly decide to have an export-led economy when a crisis hits and it’s clear that your financial and services sectors are a parasitic dud or that running an economy based on bumping house prices and buying from each other is a daft Ponzi scheme. Manufacturing reputations take decades to establish and Britain comprehensively trashed its reputation in the 60’s, 70’s and 80’s with crap products and poor leadership.
The entire world economy is in trouble right now and every country is hoping that ‘exporting’ will dig it out of a hole. That’s why Japan has just pledged to rubbish the value of its currency and invite inflation in through the front door. Britain trashed the value of the pound against the Euro as soon as the crisis hit, but as a net importer, it has only served to stoke the deficit.
There is a bigger picture here which has a lot to do with global energy availability (don't believe the recent 'revolutionary' shale hype, it's yet more PR garbage), landfill consumerism and environmental awareness. We can see that with even a relatively modest drop in demand, the world economy comes crashing to a halt. Yet for the sake of the environment, demand for all kinds of useless, pointless consumer crap needs to collapse still further…much, much further.
The ‘return to growth’ mantra is getting boring and showing up humanity as an uncreative, unimaginative race of lemmings. Actually, on second thoughts, I credit lemmings with more sense...Dixon at Commerzbank says politicians will have to give up on the idea of a quick fix: "There's been a realization among policymakers that we're not going to get the typical V-shaped recovery, and the sooner we all get used to that, the better. You get seven fat years and then you get seven lean years, as the Bible says: it's not a new phenomenon."
Is that the Gideon's Bible?
Sunday, March 10, 2013
Europe's talents and resources – its physical, human, and natural capital – are the same today as they were before the crisis began. The problem is that the prescriptions imposed are leading to massive under-utilisation of these resources. Whatever Europe's problem, a response that entails waste on this scale cannot be the solution.
The simplistic diagnosis of Europe's woes – that the crisis countries were living beyond their means – is, at least partly, wrong. Spain and Ireland had fiscal surpluses and low debt/GDP ratios before the crisis. If Greece were the only problem, Europe could have handled it easily.
An alternative set of well-discussed policies could work. Europe needs greater fiscal federalism, not just centralised oversight of national budgets.
Europe might not need the two-to-one ratio of federal to state spending found in the US; but it clearly needs far more European-level expenditure, unlike the miniscule EU budget (whittled down further by austerity advocates).
A banking union, too, is needed. But it needs to be a real union, with common deposit insurance and common resolution procedures, as well as common supervision. There will also have to be eurobonds, or an equivalent instrument.
European leaders recognise that, without growth, debt burdens will continue to grow, and that austerity by itself is an anti-growth strategy.
Yet years have gone by and no growth strategy is on the table – though its components are well known, being policies that address Europe's internal imbalances and Germany's huge external surplus, which now is on par with China's (and more than twice as high relative to GDP).
That means wage increases in Germany, and industrial policies that promote exports and productivity in Europe's peripheral economies.