“If I were the Germans, if I were running Germany, I would have abandoned the eurozone last week…It is a costly decision, but losses are there and somewhere, somehow, the losses have to be taken. The first loss is the banks. In the case of Greece, one should have kicked out Greece three years ago. It would have been much cheaper.” [BloombergTV]
Flailing Eurozone Countries Agreeing To Two Years Of Austerity Makes About As Much Sense To Nouriel Roubini As Him Agreeing To Go Two Years Without Getting Laid– Which Is To Say, NONEBy Bess Levin
Hand to god, he’d sooner die. Read more »
Former Treasury Secretary Henry Paulson said the U.S. will emerge relatively unharmed from the debt crisis in Europe as efforts by Greece, Spain and other nations to stabilize their economies persist for the long-term. “Although Europe is a drag, the U.S. will continue to muddle along with growth that really isn’t enough to make a dent in employment,” Paulson, who was Treasury secretary from July 2006 through January 2009, said at a biotechnology industry conference in Boston today. Europe will eventually stabilize and avoid a “catastrophic outcome,” he said. [Bloomberg]
Analyst: If Greece Beats Russia On Saturday, It Will Mean…Something In The Context Of Sticking With The Euro Or NotBy Bess Levin
An unusually large numbers of voters are still wavering, pollsters say. With the traditional Greek left-right political divide sidelined by the debt crisis, other factors could sway voters. “Nothing is certain, many voters are still undecided and factors such as the soccer match may be a major factor,” said a candidate for New Democracy. Greece play Russia late on Saturday in the European Soccer Championships in Poland. If Greece win, they will progress beyond the group stage and could face Germany on June 22. “Our analysts say a victory may fan nationalist feelings but they are not sure which party would benefit from that,” the candidate said. A second big factor is the weather, he said. Unusually high temperatures may send younger voters to the beach rather than the polling stations. [Reuters]
How do you like us now?
Spain, as you may have heard, does not have a lot going for it at the moment. Its bond yields have crossed 7 percent, unemployment is at something like 70 percent, and on Monday, it announced a rather poorly received bailout of the country’s banks. Investors don’t want to touch their financial institutions with a 100 foot pole. One bank that knows the rejection all too well? Banco Santander, probably on account of the open sores and the fact that it’s a regular down at the free clinic. Today, though, that’s about to change. Everyone’s gonna want a piece of this. Read more »
Nassim Taleb, author of “The Black Swan,” said he favors investing in Europe over the U.S. even with the possible breakup of the single European currency in part because of the euro area’s superior deficit situation. Europe’s lack of a centralized government is another reason it’s preferable to invest in the region, said Taleb, a professor of risk engineering at New York University whose 2007 best- selling book argued that history is littered with rare events that can’t be predicted by trends. A breakup of the euro “is not a big deal,” Taleb said yesterday at an event in Montreal hosted by the Alternative Investment Management Association. “When they break it up, there will be a lot of fun currencies. This is why I am not afraid of Europe, or investing in Europe. I’m afraid of the United States.” [Bloomberg]
Update: NNT says he’s not looking forward to a Euro break up at all actually, and that a “tawdry” Bloomberg reporter took his words out of context.
What? He Thought This Was Preferable To Inspecting His Fingernails, Sighing Audibly, And Miming “Shoot Me” At His AssistantBy Bess Levin
German finance minister Wolfgang Schauble was caught playing a game of Sudoku during a heated debate in Germany’s parliament over the latest Greek bailout. While his colleagues debated the merits of keeping Athens on life support with a controversial €130 billion ($174 billion) bailout, Schauble opted to hammer away at the numbers game on his tablet computer, according to a photo released by Germany’s Bild newspaper Wednesday…The finance minister declined the newspaper’s request for comment, but a spokesperson for his office said he was taking a well-deserved break from normal duties. [NYP, related]
Nikita Khrushchev, the former First Secretary of the Soviet Union, once remarked, “Berlin is the testicle of the West. When I want the West to scream, I squeeze on Berlin.” Given the EU’s current predicament, I find this statement prescient. But the people of Berlin could not care less about that predicament. In fact, most Berliners find Greece a bore and Portugal simply a destination for fast, easy women. So why am I so captivated by Chancellor Angela Merkel’s painful pandering and yet also sympathetic with Germany’s plight? Read more »
“I think that out of difficult times, opportunities present themselves,” Mr. Biden said today in Athens. “And with a lot of hard work and a little bit of luck, a year from now we will have not only weathered this crisis, but even be in a stronger position.” [WSJ]
Germany said “auf Wiedersehen” to naked short selling, but it appears the ban is doing nothing but raising fears that Europe is in the midst of a financial crisis of its own. Traders are already clamoring to close out open positions, but who knows if the ban will really prevent a financial calamity. Read more »