NEW YORK | Yields on Greek bonds are the highest ever. Spanish and Italians are pretty good also. If they pay back, it could be a very sweet deal for every savvy investor. And private assets are on sale too. In 2010, Apollo Global Management bought a portfolio of distressed property loans owned by Credit Suisse for about $1.2 billion, a roughly 50 percent discount to the face value, according…
By Luis Arroyo, in Madrid | The Greek restructuring has been a most impressive achievement. But it has fallen only on private investors’ heads. Public bondholders, like the European Central Bank (ECB), refused to take in their share of losses as everyone else did. When the EBC’s governor Mario Draghi was asked about the ECB’s special protection, turning the central bank into a super-privileged investor, he replied: “I can answer…
By Fernando González Urbaneja, in Madrid | Explaining the Spanish public deficit problem in 2012 in terms of confrontation between the government of Mariano Rajoy and Brussels is wrong and misleading. So far Brussels has not penalised members who do not meet their programmes, but has rather come to help achieve the objective, with more or less enthusiasm and more or less requirements imposed. Brussels may begin proceedings for an excessive…
LONDON | The latest edition of the liquidity expansion programme developed by the European Central Bank received Wednesday a warm welcome among several investment houses in the City. From their point of view, Long-Term Refinancing Operations or LTRO would not only help keep afloat European entities, within and out the euro zone, but prop up optimistic prospects over the global economic performance. In a report Schroders released today, chief economist…
By Juan Pedro Marín Arrese, in Madrid | Mervyn King sharply pointed out that banks are global in life but turn national in dying. The opposite can be applied to deficit targets. When you enjoy a comfortable budgetary position, you are able to fix them at your own wish. Brussels may get the sulks if you go beyond certain limits and fall into excessive overruns. But it can do very little…
By Luis Arroyo, in Madrid | The US economy is on its way up to the growth heaven while others, like Europe, live under the knife. Broad money or M3 volumes have increased in the US by 10pc. In terms of what it is strictly required, the Federal Reserve is fulfilling its duties. The broad money supply includes factors of money supply and money and credit demand, which means that there is activity in all money and financial markets. The…
By Tania Suárez.- The new unlimited liquidity action, a.k.a. Long-Term Refinancing Operation (LTRO), has placed €529.532 billions today, with the goal of enabling again the flow of credit to the private sector. Gradually, there are prospects of an improvement in European financial markets. On one hand, the interest rates banks charge one another to lend money have dropped significantly: the 3-month Euribor has fallen to just under 1% from about…
MADRID | Original post on republica.com | The European government, which some now call ‘governance’, has not been doing well for quite a few years. The expansion of the club during the last two decades has caused chronic indigestion, and a loss of perspective and project steam. The Single European Act (last decade of the XX century) meant a decisive step forward for a united Europe at peace, free, and…
By Tania Suárez, in Madrid | Today is the day: petitioners will submit their requests in the second Long-Term Refinancing Operation (LTRO) by the European Central Bank. On Wednesday the auction will be carried out, and the money will be distributed. Most experts estimate an amount slightly lower than the one expected by Mario Draghi (over €500 billion), and many see the LTRO with a positive feeling. However, the fact…
By Tania Suárez, in Madrid | Next Wednesday takes place the second Long-Term Refinancing Operation (LTRO) by the European Central Bank. The hot spot is the participation of some British banks, such as Lloyds and RBS (according to FT), which didn’t take part in the last liquidity auction thanks to the central bank of the United Kingdom. The end of its QE programme has forced RBS and Lloyd to forecast…