EU elections: Selling good news
MADRID | J.P. Marín Arrese | The EU seems an endless discussion on futile issues taking place in Brussels. We are all too aware that real decision-making lies in Berlin.
Articles by JP Marin Arrese
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JP Marin Arrese
JP Marin Arrese
AQR fails to address banking woes
MADRID | By J.P. Marín Arrese | The ECB is frantically submitting to scrutiny up to 60% of risk-weighted assets from the 128 biggest banks in Europe. This step stands as its last chance to avoid inheriting former shortcomings and mismatches. When it takes over responsibility for supervision later on this year, it will be blamed for any financial blunder. No wonder it wants to ensure that no nasty surprise lies ahead.
Euro pessimism is back on fashion
MADRID | J. P. Marín Arrese | Both the main economic institutions and think tanks cast a gloomy forecast on Europe. The IMF leads the way, advocating for swift action to revamp an ailing growth performance. Its blatant U-turn has drawn scarce criticism. Not so long ago, it endorsed hawkish views on the need to implement full-fledged austerity, no matter the cost, thus contributing to trigger the rotten conditions it now reviles.
Monetary policy at stake
MADRID | By J.P. Marín Arrese | Pressure is mounting on the European Central Bank. Observers blame it for an overcautious approach to rate cutting. They openly express contempt at its reluctance in setting up aggressive asset-buying schemes. Even the IMF advocates an across-the-board cheap money stance. As the ECB fails to act when inflation rates sink far below the 2% target and credit is faltering, most believe Draghi remains hostage to hardliners in Germany.
G20 delivers growth on paper
MADRID | By J.P. Marín Arrese | Will the Sidney growth strategy fly? Germany and the ECB have voiced open scepticism on its merits. So long as growth continues to gain momentum, they is little chance surplus countries might revamp domestic demand in a co-ordinated effort for anchoring recovery. They will put into practice the well-seasoned “wait and see” strategy.
Spanish banks poised to face trouble
MADRID | By JP Marin Arrese | Not so long ago, markets gauged solvency problems in Spain to lay in former saving banks as many found themselves in a shambles. Few investors cast doubts on the main credit institutions, staunchly anchored in their extensive non-domestic business. Yet sentiment has markedly shifted as trouble is looming on Latin America. Argentina undoubtedly stands as a weird and quirky case. Still, the peso collapse has sent shivers down the spine.
Electricity market in Spain: win-win rules for power companies
MADRID | By J.P. Marín Arrese | The Spanish government is thoroughly reshuffling the electricity market. Confronted with a ramping deficit between market prices and overall costs, transferred into automatic commitments to fill the gap, it is taking tough action to curb an unsustainable situation. The unwarranted imbalance is mainly due to an overgenerous policy, implemented by the former Executive, in fostering renewable energies. Fat subsidies, coupled with preferential access to the market, have propelled electricity generation costs. As demand slumped in the crisis, the share of highly expensive green energies markedly increased the toll.
Stock markets plunge
MADRID| By J.P. Marín Arrese | Buenos Aires acted in the right way by bridging the gap between its currency real value and the fake official quote. Yet, in doing so, it has openly exposed the emerging countries’ vulnerability. For the last years, their expansion delivery showed an outstanding record harnessed by cheap money conditions and renewed risk appetite, once the financial crisis looked firmly under control.
Dublin taps on capital markets
MADRID | By JP Marin Arrese | Last Tuesday, Ireland raised € 3.75 bn on a 10-year bond issue, for the first time since it exited the bailout scheme last month. Investors’ appetite run high as offers placed reached roughly four times that figure. The yield stood at 3.54% showing that confidence is swiftly pulling back to fair standards. It was a gorgeous day for the island’s economy as Dublin was able to cash half of government’s funding needs for the whole year, at such a reasonable cost.
Farewell to a sound Banking Union?
MADRID | By JP Marin Arrese | The agreement reached on a common backstop for ailing banks in the Eurozone comes utterly short of expectations.