In Europe

Greece's return

Who benefits from Greece’s return to the markets?

ATHENS |By Jens Bastian via Macropolis| The first Greek bond since 2010 was characterized by a particularly striking mismatch between the demand and supply side. More than 85 percent of those pension funds, private equity firms, asset managers and hedge funds – primarily from the US and the UK – who placed buy orders in the book-building process were left with portfolios devoid of Greek debt.What does this mismatch tell us? Clearly, this was not a coincidence. Rather, it speaks volumes of a well-orchestrated bond placement, where the sale volume was not the primary objective for the Greek Public Debt Management Agency.


Monetary Union: Single Resolution Mechanism

Does the SRM mean the end of an era?

MADRID | By The Corner | The European Parliament is giving green light to the Single Resolution Mechanism (SRM) this week for ailing banks as well as the €55 bn fund to finance bankrupcies and restructurings. Amid claims that the Euro zone’s banking sector is now safer and better supervised, some international lawmakers point out that banks are still weakly capitalized. “Europe should be careful no to make promises that it won’t be able to hold afterwards,” they say.


Spaniards

Spaniards did rescue Spain

OP ED by Julia Pastor | Brussels welcomed Spain’s economy timid comeback to the path of growth in 4Q13. When some financial publications wonder who saved the country, they quote Draghi’s OMT as well as the internal devaluation followed to PM Mariano Rajoy’s reforms. They do not mention, however, that due to internal devaluation Spaniards have seen their salaries cut by an average of 10%, and 27% of household depends on retired people pensions, who are even assuming mortgage loans their kids can’t pay anymore.



greece's bonds. Source: trade web/wsj

Care for a juicy Greek T-bone?

MADRID | By Julia Pastor | “Today we return to the bond markets after four years,” Greek Finance Minister Yannis Stournaras said on Thursday just before his country’s 5- years bonds matched analysts’ best expectations: €3bn over estimated €2-2.5 bn, with a demand around €20 bn and interest rates of 4.95% against foreseen 5-5.2%. As good food does, the auction is nourishing the twice bailed-out EU economy.


deflation

ECB: Wait, wasn’t inflation target 2pc?

MADRID | By The Corner | “I would like to stress that the risk of a self-reinforcing deflationary downward spiral consisting of falling wages and prices, as evoked by some, is also low, despite the present, very low inflation rates in the euro area. These are mainly a result of falling energy prices and the adjustment process in crisis countries,” European Central Bank Governing Council member Jens Weidmann said on Tuesday, playing down deflation risk. Anyway, what happened with the ECB’s 2pc inflation target?


Greeces stability

Greece’s ultimate sacrifice for stability

ATHENS | By Nick Malkoutzis via Macropolis| Concern has been frequently expressed about some of the people surrounding Greek prime minister Antonis Samaras. In November 2011, he ousted former minister Sotiris Hatzigakis from the party because he complained that “far right elements” were changing the face of New Democracy. Several dozen criminal cases, including murders, involving Golden Dawn had piled up in Public Order Minister’s drawers. The question now is whether these, and other policy decisions, were driven by a warped ideology that has no place in a European Union country.


Dance together

EU’s mergers ballroom is open

MADRID | By Julia Pastor | Telecoms were the first sector opening fire in the European M&A’s market with the purchase of Ono by Vodafone. Now it is the turn of the construction industry via the merger of the two cement makers global leaders French Lafarge and Swiss Holcim. Joining both businesses would result into a company valued at $ 40 bn, which is presumably to face an investigation by competition authorities. Tourism sector would also participate in the corporate ball by selling 49% of airline Alitalia to Arab Emirate’s Etihad.


Angela' s lies

Angela’s little lies

BARCELONA | By Vinçent Navarro | Germany is not only about minijobs. Although Southern European economies are debating about this measure that Berlin took under Schröder’s government in order to tackle unemployment, much less is said about the German model or ‘Rhineland capitalism’, essentially based on works councils and co-management.


No Picture

ECB: April inflation screening mode

LONDON | By François Cabau at Barclays Capital| The ECB stayed on hold this month. Keeping its easing bias, the Governing Council had a “very rich” and “ample” discussion on possible further easing measures. In our view, if expectations of a rebound in April HICP are not met, affecting the medium-term price outlook, the ECB may need to ease further.