euro crisis

wall street

ECB’s plan and upbeat jobs report cause Wall Street euphoria… and skepticism

Markets rallied on Thursday after the ECB’s highly anticipated unlimited bond-buying program to contain the euro zone debt crisis. In the U.S, an upbeat job report and news from Europe made all three Wall Street indexes close at multi-year highs. However, some experts remain skeptical on how long the euphoria will last. “I think the market generally takes these things far too seriously,” John “Jack” Bogle, Vanguard founder, told CNBC….

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China, alone in the dark

BEIJING | The world was confident about China. She was expected to be the engine of growth of the world economy. The remedy against the bitterness that surrounds Western markets. The fear of a hard landing is part of the subconscious of many experts but there is still confidence that the second world’s economy will manage to land softly. Opinions are divided: Pessimists predict a greater slowdown within the following months….


I call Angela Merkel’s bluff

By Luis Arroyo, in Madrid | German Chancellor Angela Merkel the executioner recently said that austerity is the right path, and that Canada should provide a good enough example for non-believers. Should we have a closer look into her claims?, of course we must. Unfortunately for her, it clearly appears to be the case that Canada’s success has been supported by a monetary policy absolutely at odds with the European Central…


Is Spain definitely out of trouble?

MADRID | The Spanish Economy minister Mr Luis de Guindos boldly stated to feel much the same as in the midst of the sell-out tempest, shortly after Draghi’s soothing promise. No one took seriously his assessment and yet he might be right. After all, Draghi is at best offering extra time to put the house in order. His pledge to save the euro has being interpreted as a clear signal to…

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Euro area government debt rose to 88.2% of GDP in first three months of 2012

At the end of the first quarter of 2012, the government debt to GDP ratio in the euro area stood at 88.2%, compared with 87.3% at the end of the fourth quarter of 2011. Eurostat said that in the EU the ratio increased from 82.5% to 83.4%. Compared with the first quarter of 2011, the government debt to GDP ratio rose in both the euro area (from 86.2%) and the EU (from 80.4%). At…


Is Spain doomed to be rescued?

MADRID | Most observers take for granted that the rescue seems the most likely scenario. They simply look at the rising trend risk premium shows. They may be right. But the right question to ask is why confidence on Spain is faltering so much.

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The ECB drifts away from the euro summit package

MADRID | The European Central Bank has entrenched itself in its own territory, delivering a conventional rate cut to address a downsize risk in economic perspectives. Output hovering around zero growth in Europe will drive inflation below targets, thus triggering the need to introduce some potential stimulus. But Draghi watered down Thursday’s rate decision, warning on the limited scope of lower rates when financial markets are so fragmented, risk perception…

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Widespread drops among commodities

By CaixaBank research team, in Barcelona | Oil intensified its correction and, between 20 April and 21 March fell by 10.7%, reaching 109.10 dollars per barrel (Brent quality, for one-month deliveries). Crude was therefore 1.1% above its level at the start of 2012 but 2.1% below its level of a year ago, which will pull down April and May's CPI in most economies. Oil prices confirm that they are following…

No Picture

The euro, the mistake

By Luis Arroyo, in Madrid | Why did the euro seem to work so splendidly after just a few years …to be about to crash now with such almighty noise? Here I suggest an explanation, which is simple and incomplete and yet, crucial. In the first graphic, we see the Spanish real GDP in red and Germany's in blue both at annual growth rates. The drop in the 1990s is…


You know nothing about the Grexit

JLM Campuzano, Citi strategist, in Madrid | I read half surprised, half indignant, that a competitor released today an investor note in which the pending exit of Greece from the European Monetary Union is given a week as a deadline. The arguments are all too well known: the Hellenic authorities have already breached the adjustment plans, the country’s political parties will not come together in any of the urgent agreements…