LONDON | The cost of too many layoffs made during a steep crisis could leave a wide range of businesses unable to board the pick up economic train. So either it is optimism in the medium term or an honest belief in the coalition government’s mantra ‘we are all in this‘, but research from insurance firm More Than revealed Wednesday how small business owners are going to extraordinary lengths to…
By Luis Arroyo, in Madrid | The ECB has lost all his monetary gunpowder, as this has become fragmented. In this graph I saw recently on the Greek money supply, monetary aggregates M1 M2 and M3 have collapsed. Deposits are falling, like savings accounts and time deposits. However, the monetary base or the money issued by the ECB is the same for everyone. What happens is that in normal countries the banking sector does not experience problems to expand its assets (loans), what results in an increase in deposits. The multiplier effect works. But what happens…
By Luis Arroyo, in Madrid | John Authers, in Trends That Don’t Seem to Make Sense, have some pertinent questions to share. The one that has attracted my attention is: Why is the euro still so strong when at all other times a currency with so many risks would be certain to weaken? Resilience of the euro is startling and damaging. The eurozone’s crisis has been driven by balance of payments problems…
MADRID | Spain seems crippled by mounting economic woes. It faces a steep rise in risk premium fuelled by plunging confidence on its ability to reverse the bleak outlook ahead. Recession takes its toll in terms of higher unemployment, budgetary deviations and extensive deterioration in the banking sector. Reforms undertaken so far have failed to deliver any tangible benefit. Labour market overhaul has only helped to accelerate lay-offs, with no impact…
Many economists and the Anglo-Saxon financial gurus have been killing the euro month after month since early 2010. But, even if their doomsday predictions have miserably failed so far, their negative influence over the markets can not be neglected. By Fernando Barciela, in Madrid | PART 3 | Some banks, especially in the UK, were not far behind the panic wave and at that time announced that they had intensified their contingency plans before the more than probable failure of the euro. After…
Many economists and the Anglo-Saxon financial gurus have been killing the euro month after month since early 2010. But, even if their doomsday predictions have miserably failed so far, their negative influence over the markets can not be neglected. By Fernando Barciela, in Madrid | PART 2 | Euro mayhem? The fall of Brussels? Russian domination? German isolation? An article like this has already been published by a serious magazine, The American Spectator, supposedly devoted to calm, profound analysis. Flipping through the pages of Fortune,…
Many economists and the Anglo-Saxon financial gurus have been killing the euro month after month since early 2010. But, even if their doomsday predictions have miserably failed so far, their negative influence over the markets can not be neglected. By Fernando Barciela, in Madrid | PART 1 | We heard Noel Roubini prophesying the end of the euro early in 2010 at the World Economic Forum in Davos, Switzerland, in a somewhat evanescent fashion (“an increasing risk and an approaching…
Many economists and the Anglo-Saxon financial gurus have been killing the euro month after month since early 2010. But, even if their doomsday predictions have miserably failed so far, their negative influence over the markets can not be neglected. By Fernando Barciela, in Madrid | In one of his recent and terrifying articles about the euro and the sovereign debt crisis in the Financial Times, ‘There is no Spanish siesta for the eurozone‘, Wolfgang Münchau found that many…
FRANKFORT | That is the view from Berlin: the biggest problem Germany contends with is Europe. And this is so particularly because of this fact, more than 17 million people are unemployed in the euro zone. But while in Austria the unemployment rises to 4.2% and 5.7% in Germany, the Spanish labour market suffers the tragedy of jobless figures that come to 23.6%. And there is no prospect of improvement. The problem is…
MADRID | Afi analysts drew today investors’ attention to the widening divergence between the manufacturing cycle of the European Monetary Union and other economic blocs. PMI figures of the manufacturing sector fell again in the euro zone’s aggregate indicator, slipping into activity contraction levels. Apart from China’s, the rest of PMI numbers are either consolidated or approach the expansion area. At Afi, experts forecast a EMU GDP downward correction of 0.1pc…