When you’ve been on the edge of having a convulsion for months, you could be excused for clutching at anything to convince yourself at least temporarily that you’ve turned the corner. Today, this is looking like a fair characterization of last week’s big relief rally at the euro “rescue” plan that was “agreed” in Brussels. Markets are trading significantly lower this morning, and much is | Read More »
As I wrote here yesterday, we ‘ve just seen the remarkable spectacle of more than a dozen fractious finance ministers come together to puncture the risk of a Lehman-style market debacle. Taking a page out of Ben Bernanke’s playbook, they cobbled together and announced a package of 750 billion euros (nearly a trillion dollars) in liquidity guarantees. Think about that number. It’s twice the size | Read More »
The situation in Europe in regard to Greek debt may be entering a new phase, and I’m talking about something more serious than tear gas and Molotov cocktails. Now that the EU and the IMF have agreed on (and the key legislatures have ratified) a 110 billion euro bailout for Greece, the question has become: will it be enough? Greece faces unusually severe austerity budgets, | Read More »
We’ve had a remarkable run in US notes and bonds over the past several weeks. The economically-sensitive 10-year note briefly yielded more than 4% in mid April. After an astounding rally yesterday, buying in the 10-year continues this morning, and its yield is down to 3.57 as I write. I’m at a loss to convey the magnitude of this move in such a short time. | Read More »
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