Category Archive: Euro #Crisis

Robert Mundell: Why Libertarians Must Love the Euro

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European Banking Assets and Debt

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Reasons for the Spanish Housing Bubble

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The European Transfer Union From North To South and from Poor to Rich between 1999 and 2007

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Dijsselbloem: The End of the Bankers’ and Bond Holders’ Moral Hazard

We have insisted in several posts that the northern euro zone is very reluctant to continuously bail out the periphery and in particular its banks. The euro group chief Dijsselbloem has confirmed this now.

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Cyprus, the Final Compromise: The Winners and the Losers

 UPDATE March 25 The final compromise: via Reuters TOP NEWS Detail of EU/IMF bailout agreement with Cyprus Sun, Mar 24 22:19 PM EDT BRUSSELS (Reuters) – Cyprus clinched a last-ditch deal with international lenders on Monday for a 10 billion euro ($13 billion) bailout that will shut down its second largest bank and inflict heavy …

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Cyprus: The initial compromise and reactions

The initial compromise The Cyprus compromise combines a 10 billion € bailout with European, basically German tax-payers money, that also obliges rich account owners (9.9% levy) – rich Russians and Brits – and poorer account owners (6.75% levy) – Cypriot tax-payers money – to take part in the deal. Initial reactions from Zerohedge over Keynesian mainstream …

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Permanent link to this article: http://snbchf.com/2013/03/cyprus-updated/

Cyprus Levy on Deposits: New Escalation or Final Stage of Euro Crisis?

Nicosia will impose a 9.9 percent one-off levy on deposits above 100,000 euros in Cypriot banks. This constitutes maybe the final stage of the euro crisis, with the very  last country to be rescued. Or will it be a new escalation and may be the most dangerous one, a bank-run? How many Cyprus clients managed …

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Deflationary Risks? Comparing Swiss, Swedish and Norwegian Inflation and Exchange Rates

When the Swiss National Bank introduced the 1.20 lower limit, it wanted to eliminate the deflationary risks for Switzerland. For a certain period, namely when a global recession was looming in Autumn 2011, and the Swiss franc was hovering around 1.10, this risk was really present. In this post we would like to know if …

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The Euro Crisis: the Reasons

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Ways to the Northern Euro

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Is the Swedish Krona a Safe-Haven?

Arguments in favor of and against the Swedish Krona,as safe-haven during the euros crisis. Extracts from tradingfloor.com

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Who Says No to Austerity and Global Imbalances, Must Say Yes to the Northern Euro

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The Upcoming Spanish Lost Decade(s)

To us, the big theatre surrounding Greece was just a preview of a much bigger crisis that will happen in the coming years in Spain, the upcoming Spanish lost decade(s). Greece was an absolutely desperate case; therefore, everything was quick. It took just two years till we arrived at the official sector participation and yearly German transfer …

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The Fairy Tale of Rising Competitiveness in the European Periphery

In our post we look on two questions concerning competitiveness for the European periphery: When will local production be cheaper than imported products? Do people have the money to buy these local products? It does not help reducing labor costs if local production costs still more than imported products. The second aspect is: even if …

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The European to Follow the Latin American Debt Crisis Model

Contributed by Jerome Roos, of Roarmag.org, reflections on a revolution   Mexico’s collapse of 1982, the extreme response of the US and IMF and the following Latin American debt crisis marked the birth of an elite consensus that continues to haunt Europe today.     As Nick Dearden, Director of the Jubilee Campaign for debt …

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4 Different Solutions for the Euro Crisis: Can it Be the Northern Euro? A Discussion

The discussion about the future of the Euro: Among a Post-Keynesian, a European Etatist, an Austrian economist and an advocate of a Northern Euro on the French website www.atlantico.fr. The French paper is asking: “Sommet européen : créer un euro du Nord est-il le seul moyen de sauver l’Europe de l’austérité ?” Is the creation of …

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German Economists and Merkel, the Implicit Followers of the Gold Standard

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The Euro Crisis: Details and chronology and the German Perspective on it

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Euro Morons: Hyperinflation Successfully Avoided, Stagflation Successfully Created

Keeping Greece in euro zone, eurocrats or better “euro morons” have successfully avoided a weak drachma and a following Greek hyperinflation. Instead they successfully created stagflation. Currently European HICP inflation is at 2.5%, far above the max. 2.0% official ECB mandate, but the euro is becoming weaker and weaker. German salaries are rising with 2.6% …

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Das Beste von Ludwig Poullain: Das Ende des Euros, der Beginn des Nordeuros

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The Eurozone crisis between euro-morons and zombie-bankers

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Falling Unit Labour Costs, but Rising Production Prices in the Periphery. Is this Competitiveness?

Currently European HICP inflation is at 2.5%, far above the 2.0% official ECB mandate, but the euro is becoming weaker and weaker. German salaries are rising with 2.6% per year. At the same time, the ECB cannot hike interest rates, because it wants to provide cheap money to the periphery.   The periphery continues to buy German products, even …

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74.8 percent of Norwegians Say No to EU Membership

In the latest poll, 74.8 percent of the Norwegian population says no to EU membership, while 17.2 said they would vote yes in any referendum. 7.9 percent have not decided. Seven out of ten voters of the ruling party do not share the party’s views on the EU and would have voted no in a possible referendum, …

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Eurobonds, fiscal or banking union are all pure utopia

Germany’s stance in the euro crisis: More than ESM will not be possible for many years updated on August 31, 2012   German politicians and the German Bundesbank believe that the Euro crisis can be only solved by supply side reforms as formulated in the Euro Plus Pact, reforms that were already successfully introduced during the Thatcher/Reagan era in the …

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The End of ECB Rate Cuts or Draghi against Weidmann to be Continued..

  Even in the unlikely case of a fiscal union, the conflict “Draghi against Weidmann”, between the ECB and the Bundesbank will continue for years. The ECB mandate and european inflation figures do not allow for excessive ECB rate cuts or for state financing via the printing press, but Draghi wants to help his struggling …

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Euro Crisis, A Summary of Relevant Posts

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All roads lead to a euro zone break-up

For us all roads lead to a euro zone break-up and multiple sovereign defaults.   Our reasoning can be summarized as follows: Equities are worthless when associated debt becomes encumbered (risk capital takes the  first loss). Equity is not an asset; it is merely the remainder that is left over once debt is subtracted from …

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Otmar Issing’s new book on the euro crisis

  We well remember when the über-bailouter of the Financial Times Wolfgang Münchau claimed that except some old economy professors like Otmar Issing nobody in Germany would like to abolish the euro. According to Münchau the euro can be saved only via a fiscal and a banking union. The response to Münchau’s post could be …

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Dirk Müller: Die Strasse wird das Euro-Aus erzwingen

Dirk Müller: Die Strasse wird das Euro-Aus erzwingen      

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Diskussion beim IFO-Institut: Die Schuldengemeinschaft und Generationengerechtigkeit

Die Aufklärung für den mündigen Bürger über ESM, Eurobonds, Schuldengemeinschaft und Generationengerechtigkeit. Nehmen Sie sich die Zeit und Sie können die kommende Politik Merkels und den weiteren Verlauf der Eurokrise voraussehen, möglicherweise sogar mit ihrem Investment .

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German constitutional court needs 3 months to decide about the injunction

The German constitutional court will need up to 3 months for the injunction. Weidmann’s critic on the ESM in detail. Estimations of German liability between 900 bln. and 2 trillion EUR.

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Update vom Deutschen Verfassungsgericht 11. Juli

Deutsches Verfassungsgericht braucht 3 Monate für seinen Eilentscheid, der nun eine halbe Hauptsachenentscheidung ist. Die Wahl im Gericht zwischen der system-relevanten Bank ESM und dem “Herausschmeissen” der Südländer aus dem Euro und vieles aus dem Verfassungsgericht.

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German constitutional court injunction decision on ESM and the potential referendum

What is the injunction procedure of the German constitutional court exactly about. What are the arguments of the Anti-ESM and the Pro-ESM fractions ?

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Only 17% of German voters in favor of Eurobonds

  Voters are strongly against many other European utopias The newest poll of the Forsa institute, here in the left-wing Stern and the conservative Welt, shows that Germans are strongly against Eurobonds and many more European “utopias”, as we called it. The German chancellor Angela Merkel recently connected her life with the fulfillment of the voters wish to …

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Wolfgang Münchau, FT: Merkel was the winner of the Euro summit

  Wolfgang Münchau endorsed many of our arguments Wolfgang Münchau, Financial Times, has endorsed many of our arguments of our Friday’s opinion  about the Euro summit where we stated that there was nothing really new. Münchau even claims that “The real victor in Brussels was Merkel.”

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At the Euro summit there was nothing really new. What was the party about ?

At the euro summit today there was essentially nothing what was really surprising. We wonder what markets are so excited about.

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Merkel: ‘No Eurobonds as Long as I Live’, Hollande: ‘Eurobonds will take up to 10 years’

  German chancellor Angela Merkel today confirmed the content of our article that Eurobonds are pure utopia. She vows  ”No Eurobonds as Long as I Live”.

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Can Merkel stop the Eurobonds ? German “Der Focus” on Eurobonds

  The German “Der Focus”,one of the most successful weekly magazines, titles “Can Merkel stop the Eurobonds ?” Der Focus claims that Eurobonds have the following issues:

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Eurobonds, fiscal union or banking union are all pure utopia

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History repeats: Bismarck & the customs union with Austria-Hungary (in German)

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The German supply-side reforms or will German companies take over the PIIGS ?

Words heart on German street in 2010 during the first Greek bailouts were that Germany should obtain the Greek islands as collateral if Greece is not able to pay back the debt to Germany. But even today German n-tv is reporting about many Greek real estate brokers that are currently delling islands. If it is not that type …

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The Northern Euro introduction: A retrospective from the year 2030

  A retrospective from the year 2030 on two decades of failed european integration policy and 10 years of successful disintegration policy The following essay shows that currency regimes come and go over the time. Nothing is stable with the time, especially the use of a currency. What has never happened in history is the use …

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Italy: About the Hypocrisy of Politicians and the Blindness of the English-Speaking Financial Papers

Just a little wrap-up of two tweets read in 5 minutes, to which I finally added a bit more out of my recent Tweets. One Tweet: The British finance minister Osborne has emphasized that the euro zone needs to protect its peripheral economies. “The whole of Europe needs to become more competitive and productive. That …

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The new European Save-Havens: Trade SEK/CHF and NOK/CHF

After the announcement of the floor in the EUR/CHF pair, many predicted the Swedish and the Norwegian Krone to take the place of the Swiss Franc as European save-haven against the Euro turmoil (http://on.ft.com/pKSJ1V). Both countries possess a low level of debt, positive trade balance and very competitive economies.

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Jürgen Stark’s resignation and the ECB 2005 warning about labor cost divergence in the Euro-zone

The Wirtschaftswoche reports about the real reasons of ECB Chief economist Jürgen Stark’s resignation. The reasons are rather political, namely a protest against European governments:

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The Spanish Ailing Car Industry

  Extracts from Think Spain. October 2005.   Foreign companies who manufacture cars in Spain are facing a fresh crisis. In addition to the problems of VW subsidiary Seat, various others are being forced to take decisions about the renewal of a number of different models which are reaching the end of their life-cycles. While …

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