Welcome to Fantasy Island, I’m Your Host, Mr. Rajoy

Posted by on Jun 9, 2012 in Uncategorized | No Comments

With another full day ahead of this, things could change, but here is how I understand the situation. In the EFSF “guidelines” there was this little statement ii) Finance recapitalization of financial institutions through loans to governments including in non-programme countries It looks like the EFSF/ESM will lend money to something called the FROB which […]

The T Report: Is June 6th D-Day Once Again?

Posted by on Jun 4, 2012 in Uncategorized | No Comments

The ECB meeting on June the 6th seems key to me. Markets and economies are teetering across the globe. More and more people are coming to the conclusion that a Greek Exit would be catastrophic. Central banks won’t want to act as though they are panicking, but neither will they want to wait much longer […]

Why a Grexit Would Make Lehman Look Like Childs Play

Posted by on Jun 2, 2012 in Uncategorized | No Comments

  Maybe I’m wrong, but every time I look at the possibility of a Greek exit right now I see it spiraling out of control and dragging down the entire global economy. I hear and read the arguments of why it is controllable and they just don’t seem credible. They either link a Greek devaluation […]

The T Report: The Non Jobs Report and the Myth of De-coupling

Posted by on Jun 1, 2012 in Uncategorized | No Comments

  It is a global economy. Europe is a mess. China is struggling. Whatever strength the U.S. economy had earlier this year has now dissipated. The theory that somehow the U.S. can “decouple” is taking a serious beating, and the even less realistic view that Germany could “decouple” is also being torn to shreds. The […]

The T Report: National Acronym Day in Europe. Don’t Underestimate the ECB

Posted by on May 30, 2012 in Uncategorized | No Comments

  So the EC wants the ECB to bypass the EFSF and use the ESM to recap EU banks? That was the rumor that shifted global stock markets by 1% in a matter of minutes? It has been awhile see we looked at the EFSF Flowchart or had a detailed look at the EFSF Guidelines […]

The T Report: Where Have All the Cheerleaders Gone?

Posted by on May 29, 2012 in Uncategorized | No Comments

  Stocks are rising in spite of a lack of cheerleading. Europe did very little last week at the summit and this time it seems most pundits took the time to notice that. The Bankia “rescue” is highlighting how bad the Spanish banking system is how much the country is going to need to spend […]

Spanish Bonds – Austerity, Spending, and Reality

Posted by on May 28, 2012 in Uncategorized | No Comments

Spanish Bonds – Austerity, Spending, Honesty, and Reality Austerity will not work. While it is prudent to cut some frivolous programs and will be important to cut future programs that were too generous, there is little that can be cut today that won’t actually hurt the economy and make the situation worse. The big savings […]

Europe Fighting the Wrong Battles Again with Dangerous Consequences

Posted by on May 26, 2012 in Uncategorized | No Comments

  Europe continues to fight the wrong battle, and continues to spread contagion risk. It is clear that Greece has had a solvency issue now for over 2 years. The ECB and Troika chose to treat it as a liquidity problem. Maybe, they could have argued that in early 2010, but by the summer of […]

The T Report: Attack of the Killer E’s, Ease, and Eeze Updated

Posted by on May 25, 2012 in Uncategorized | No Comments

  My view from earlier this week remains intact and seems to be playing out. Project bonds are coming. The ECB (except for Weidmann) continues to say positive things and act as though there is more to do. The Fed has been quieter than I expected, but I still believe they will do something, bank […]

Regulatory Capital: Size And How You Use It Both Matter

Posted by on May 24, 2012 in Uncategorized | No Comments

  Bank Regulatory Capital has been in the news a lot recently.  The Spanish banks have their own set of capital issues.  There has been a lot of discussion about Too Big To Fail (“TBTF”) in the U.S. with regulators demanding more and banks fighting it.  After JPM’s surprise loss this month, the debate over […]