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In Europe 28th January 2015

Striking a deal with Tsipras

MADRID | By JP Marin-Arrese | European governments are openly expressing dismay at the Greek election outcome. They have waited quite a long time to convey their congratulations wishes to Tsipras, the new elected Prime Minister. Berlin and Brussels stressed that debt restructuring was out of question while reminding him of  the need to keep pledges from former governments as a pre-condition for securing financial support. Yet, they should come to terms with him, the sooner the better, as a thoroughly deceived and frustrated European Council member can inflict damage to EU action. 

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In Europe 26th January 2015

Who can blame Greek voters?

By Benjamin Cole via Historinhas | The unemployment in Greece is 25 percent. The Greek economy has shrunk by 29% since 2009. That is a full-blown economic depression, an outright failure of macroeconomic policy.

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In Europe 26th January 2015

Syriza’s victory: Greeks reject Europe’s recipe but they need Brussels’ support

MADRID | By JP Marín Arrese | The landslide victory snatched by leftwing Syriza plus the sizeable score recorded by parties opposed to the austerity measures represents a challenge to Europe’s orthodoxy in addressing real adjustment. Greek voters have voiced their rebuke to policies encompassing significant sacrifices but failing to redress a dismal economic record. Scrapping key elements of the welfare state and imposing harsh conditions on citizens has resulted in widespread poverty. In addition, the sentiment the troika was running the country has infuriated many of those going to the polls on Sunday. For all the popular support received, Tsipras faces a  formidable challenge ahead in delivering his election promises.

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In Europe 23rd January 2015

Draghi’s D-Day

MADRID | By JP Marín Arrese | The ECB unleashed a monetary onslaught yesterday aimed at breaking the stubborn deflationary pressures and sluggish growth have shown up to now. The massive artillery barrage mercilessly pounded enemy lines  with tons of fresh money, leaving defenders no other option than  unconditional surrender. With all ammunition and reserves engaged in this breathtaking D-Day, the ECB would find itself helpless should its gamble fail. As previous landings ended in disaster, the issue now is whether this assault will work as planned. 

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In Europe 22nd January 2015

What next Greece?

By Gabriel Sterne via MacroPolis | It is easier to write down big questions on Greece’s future; harder to answer them: (1)   Will Syriza win with an overall majority?; (2)   Will a new programme be agreed in time?; (3)   To what extent will it stay on track?; (4)   How much additional debt relief and financing will the Troika give to Greece, and in what circumstances?; (5)   If and when the wheels come off the programme, is an exit inevitable? Would it be managed or chaotic? One thing we can be sure about though. The scene is set for a political showdown, the likes of which the Euro-crisis has not yet seen.

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In Europe 22nd January 2015

QE European style: €60bn monthly bond-buying until Sept 2016

MADRID | By Ana Fuentes | Amid huge market expectation, ECB’s president Mario Draghi unveiled THE operation aiming to spur growth in the eurozone: the European QE will consist of €1.1tn sovereign bonds purchases, or €60bn a month until September 2016, beginning in March. A crucial move in exchange for low risk sharing (only 20% of bonds purchased by ECB, 80% by national central banks; and Greek bonds are expected to remain out). The euro touched an intraday low of  1.1451 dollars.