Banks Get Bailouts, They Don’t Give Them
From the moment the IIF proposal first came out I have argued that it is a good deal for banks – no accounting loss – a highly rated zero coupon bond – and higher coupon payments – in exchange for extending maturity on debt that couldn’t be paid back. Banks were winners. The fiction of […]
Will They Hold Hands?
The only real question remains, is whether Merkel and Sarkozy will hold hands to add emphasis to their “we saved the world” announcement. We will get an announcement and it will sound positive. Unless they did a lot of work in the past 24 hours, it seems unlikely that any details will come out. We […]
ECB Bond-Buying Should End With New EFSF, German Motion Says
ECB Bond-Buying Should End With New EFSF, German Motion Says (1) I think this is one of the most important bits of news on the day. This and the fact that the Dutch finally said something – and it wasn’t positive. I have been arguing that the solutions create contagion rather than prevent it. I’ve […]
Guilt, Growth, Lies, Laziness, and Liquidity
We are getting closer and closer to some actual details. Eventually EFSF will be only one or two things. We will see how much or how little outside money gets contributed. Guilt: I attended a presentation yesterday and the one thing that surprised me the most, was the apologetic tone of the Germans. They seemed […]
The Miracle On Ice
One of the Greatest Sports Moments of the 20th Century. What made it amazing was that a bunch of American amateurs defeated a team of Soviets that were amateur in name only. The Soviet Union, whatever the ideals of communism were, had given up on those ideals. Individuals with special talents were given special rewards. […]
Rumor Is That The Plan To Save Europe Is A SPIV?
Rumor is that the plan to save Europe is a SPIV (Special Purpose Investment Vehicle)? Here is the Oxford English Dictionary definition of SPIV. Somehow, it is the most apropos “solution” to this problem. For those who can’t pull up the OED definition, it starts with: A man who lives by his wits and has no regular employment; […]
TMI On PMI
Closer to home (pun intended) is the bankruptcy or receivership of PMI. It is almost hard to believe that they raised over $475 in an equity offering just last April. I don’t expect any material consequences in the CDS markets as it wasn’t in many indices (just the recent HY ones I believe) and it […]
The Check Is In The Mail
So we are still in planning to plan mode. The markets remain calm in spite of the fact that any plan was delayed again, and it is perfectly clear no one in power in the EU had attempted to work out a single detail of any plan until last week. There is so much to […]
The Average Hans
I have no idea what the equivalent of “Joe Six-Pack” is in Germany, but I can’t believe they are going to be happier tomorrow. Most Germans were not happy about bailing out Greece and the other countries that got themselves into debt trouble. The poll numbers show strong support against it and Merkel has been […]
Plan A Summit And Plan B Summit?
The market is rallying on a new summit and a new joint statement. Read the statement closely. If Plan A was going to work, wouldn’t that be done this weekend? If you were moving to Plan B wouldn’t you want that closer to the leader meeting? Ministers of finance may be able to make positive […]
