For more
articles see last night’s US Close: More bailouts! and follow the recently
updated special post Spanish
Bailout: The Collection.
Daily US Opening – RanSquawk / ZH
Frontrunning
– ZH
The Lunch
Wrap – FT
EM New York
headlines – FT
Overnight summary – Bank of America / ZH
Today’s
front pages – presseurop
Eurostat: Interest payments on the bailout will count as public deficit
Broker Note
Briefing – WSJ
Morning
Take-Out – NYT
AM Dear
Dairy: Quiet – Macro and Cheese
The T
Report – TF Market Advisors
Pre-market
Commentary – Marketwatch
Pre-Market
Trading – CNNMoney
Pre-Market
– NASDAQ
US Equity Preview – Bloomberg
Earnings
& Events – The
Street
MarketCurrents
– Seeking
Alpha
Debt
crisis: live – The
Telegraph
The Euro
Crisis Blog – WSJ
FX Options
Analytics – Saxo
Bank
European
10yr Yields and Spreads – MTS indices
EURO CRISIS
Contractionary Fiscal Contraction, Quantified:
European Edition – EconBrowser
Deutsche
Bank estimated multipliers for several nations: Crisis countries high, core
countries low. Just proves the point that austerity will not help.
Winding Down the Eurozone – The Aleph
Blog
1) acknowledge
that you made a mistake in creating the Eurozone 2) re-introduce individual
currencies 3) dealing with bankrupt nations. 4) force an exchange into the
underlying currencies.
2012 Eurozone funding requirement by country – Sober
Look
Spanish banks will have no trouble absorbing
this debt…Italy on the other hand will have a tougher time. At €120bn, the nation's
requirement is the highest in the Eurozone.
The euro crisis as family drama – Opinion
/ Reuters
Only the ECB Godfather has what it takes. The
central bank might have to abandon some principles, but it has the ability to
create enough money to keep governments and the financial system afloat for as
long as necessary.
Any Rabbits Left in the Hat? – Mish’s
ESM: Subtract Italy crippled with a 120%
debt to GDP ratio and Borrowing money at 4-5% to Lend to Spain at 3% and you are
under the €100 billion mark. Even including Italy, the fund for 2012 is
nearly all spent. What happens if Spain needs €350 billion as
per analysis from JPMorgan? What Happens if Italy needs a bailout?
In the shadow of Greek elections – MacroScope
/ Reuters
Italy moving centre stage, Athens to be given more time on austerity,
Cyprus, SNB meeting
EURO CRISIS: BANKS
Banking sector could be 'wiped out' if weakest
nations leave – The
Guardian
Analysis by Credit Suisse estimates that up to
58% of the value of Europe's banks could be wiped out by the departure of the 'peripheral'
countries
Room for manoeuvre among Eurozone banks – voxeu.org
Europe’s heavily overleveraged banks are now under European Banking Authority
orders to rapidly raise their capital-asset ratios. Many fear that this will
trigger a contractionary shrinking of assets rather than prudential increases
in capital. This column presents new evidence that these fears are unfounded.
Eurozone banks have room for manoeuvre.
EURO CRISIS: TARGET2
Germany’s Constitutional Conundrum – New
Economic Perspectives
Don’t worry about Target2 – Felix
Salmon / Reuters
But what if the entire eurosystem fell apart,
and every country reverted to its own national currency? In that case, it’s
still hard to see how there would be much of a hit to Germany.
EURO CRISIS: ECB
Statistics Pocket Book, June 2012 – ECB (pdf)
Monthly Bulletin, June 2012 – ECB (pdf)
EURO CRISIS: GERMANY
EUobserver understands that the German
government is opening up to proposals for a "banking union"
The German government has begun opening the
door to shared debts for the first time in a profound change of policy,
agreeing to explore proposals for a €2.3 trillion (£1.9 trillion) stabilization
fund in order to stop the eurozone’s crisis escalating out of control.
German Vote on ESM Fails; Still Not Ratified by
Germany, Austria, Belgium, Estonia, Slovakia, Netherlands; Political Football Over Financial Transaction Tax – Mish’s
The universal sad state of affairs in politics
is that passing something stupid (such as the ESM), requires the passing of
something else that is also stupid (in this case the Financial Transaction
Tax). In the end, stupidity is inevitably compounded.
Heading for an own-goal – Free
exchange / The Economist
The danger with such political wrapping is that
an FTT will be included, and applied, before it has been properly thought out.
German politicians have agreed to something in principle without considering
the design, and whether it might actually work.
Merkel Says Germany Leads Crisis Fight, Rejects Quick Fix – BB
Empty words: “All resources, all measures, all packages will end up being smoke and mirrors if it becomes clear in the end that they extend beyond Germany’s capacity.”
Empty words: “All resources, all measures, all packages will end up being smoke and mirrors if it becomes clear in the end that they extend beyond Germany’s capacity.”
EURO CRISIS: SPAIN
Spain Bailout Terms: 100 Billion Euros for 15 Years at 3% Interest, No
Payment for 5 Years; How to Pay it Back? Hike VAT on Consumers – Mish’s
Can someone tell me why taxpayers are
responsible for banks making stupid loans?
These Three Spanish Banks Will Be Downgraded – ZH
EURO CRISIS: ITALY
Italy, one of the founders of the European
Union, is now in the most critical of situations. If many different things do
not go well for the bel paese in the next year, it may attract the use of the
word “founder” in its other, more sinister meaning: to sink.
A full-fledged bailout of Italy is a theoretical
construct, anyway. As the third largest economy in the Eurozone, it’s too big
to get bailed out by the Eurozone. Of the 17 member states, five, if Cyprus is included, are
already being bailed out. Leaves 12, including teetering Italy, to pay for them. If Italy falls, the two major
countries left standing to bail all of them out would be Germany and France. An impossibility.
OTHER