In Europe

renzi contento1 TC

How far will Italy’s labour reforms go?

MADRID | The Corner | Italian PM Matteo Renzi won the Parliament’s confidence vote on Italy’s labour reforms on Thursday, the most importan in his 8 months in the job. As the country’s economy has been stagnated for two decades, many wonder how far the center-left government’s plans will go. The current jobless rate of the eurozone’s third biggest economy is above 12% (44% youth unemployment). “Italy must reduce the proportion of workers on temporary contracts in the overall work force, but the details yet to be unveiled remain critical to assess whether it represents a true game-changer or not.” analysts at Barclays commented on Friday.


ejecutivos puente londres TC

UK: Reputation can’t be bought at the supermarket

LONDON | By Víctor Jiménez | We leave the Thameslink station, in the southern section of Ludgate Hill Street that leads to the door of St. Paul’s Cathedral in London. We are close to Square Mile. On our way to his office, the veteran financial journalist Jon Hay explains that Euromoney (one of the large market information publishing companies in Europe) has started to hire new reporters to cover, for instance, the latest data on the collateralised loan obligations (‘CLOs’), which are one of the debt structures that got deflated after the 2007 credit bubble burst. 


españa demanda domestica TC

Spanish domestic demand grows along with external deficit

BARCELONA | By Joan TapiaThe Spanish economy has come out of recession and citizens have begun to  notice, encouraged by a slight increase in employment creation (albeit temporary, part-time and minimum wage employment, but it at least entails an increase in those joining the workforce). Thus, the CIS’ Economic Confidence Indicator –which ranges from 0 and 100, recorded a low 35.7 (although it represents a 16% increase with respect to 2013). For its part, the Consumer Confidence indicator –which is different and ranges from 0 and 200- is at 89.3, 22% higher than the data from September 2013. The trend appears to point to an awakening of domestic demand.


labour markets

No jobs, no growth: Why the ECB’s last bulletin points to eurozone labour markets

MADRID | The Corner | Although employment is not in the central bank’s mandate, the European Central Bank’s October monthly bulletin focuses on the impact of the economic crisis on euro area labour markets. “Monetary policy is focused on maintaining price stability over the medium term and its accommodative stance contributes to supporting economic activity. However, in order to strengthen investment activity, job creation and potential growth, other policy areas need to contribute decisively.”


draghi merkel TC

Germany’s dilemma: Between Europe and the AfD’s europhobia

FRANKFURT | By Lidia Conde | It is time to grow! Well, that’s everybody’s motto. However nobody agrees on how. That’s why the European Central Bank is moving ahead with its bond-buying program. After all, if the ECB steps away from its inflation target, the structural unemployment rate would increase and the potential economy growth would be reduced. 


No Picture

Eurozone: fundamental flaws

MADRID | By JP Marín ArresePotential mismatches between overall demand and supply can provide rather upsetting lessons. As Keynes proved, sticking to stability policies in a recession only widens the gap as slackening demand and production drag each other down in an endless spiraling circle. Moreover, he cast serious doubts on the strategy of combining loose monetary policy with balanced budgets  for putting the economy back on track. His liquidity trap theory mirrors Draghi’s current warnings on the ECB’s limits in coping with a huge GDP gap.


PEDIDOS MANUFACTURAS

A weak euro doesn’t necessarily mean stronger Q3, Q4 earnings

MADRID | The Corner| Shouldn’t a weak euro boost Q3 and Q4 earnings? As Barclay’s Alberto Vigil commented on Wednesday, up to this point there is no doubt that exports have benefitted from it, but “it is not that clear whether this positive effect will manage to boost domestic and emerging markets which are the destination of many exports.”


No Picture

Greece: ‘We’re dying to pay our taxes’

ATHENS | By Damian Mac Con Uladh at The AgoraLike thousands of citizens, Nikolas Elliniadis had left it to deadline day to go to his bank, in Thessaloniki, Greece’s second city, to pay the first of six instalments of Greece’s new property tax, the latest levy to hit a population beleaguered after five years of austerity.



lord hill

Capital markets union and Lord Hill’s answers to next hearing

MADRID | The Corner | Newly appointed Commissioner for Financial Stability, Financial Services and Capital Markets Union, Jonathan Hill, received a “written exam” from the Parliament’s ECON Committee, whose members felt he had failed to sufficiently answer their questions at his first hearing. Lord Hill replied with his answers in writing on Sunday (see link below). Unfortunately, while Hill appears happy to offer his take on financial regulation, he was rather less forthcoming when it came to revealing his ties with The City of London.