Credit Writedowns

I am not particularly shocked or worried about the cancelled European finance ministers meeting. I still think this bailout gets done because Europe and the markets are not prepared for a disorderly default and politicians cannot risk the…

The vagaries of Europe's debt crisis continues to be the most important driver of the short-term price action in the foreign exchange market. Indications that Greek New Democracy leader Samaras would sign a letter of commitment to the aid…

Financial news links for 15 February 2012

This post discusses how politics and economics will interact in the Greek debt crisis and lead to default and euro zone exit.

Despite the Greek parliament's approval of austerity measures, there is still considerable uncertainty in the Greek situation. This post outlines many of the issues still up in the air.

The US dollar is broadly mixed against the majors and EMs after the market appears to have shrugged off Moody’s downgrades of European sovereigns. Central banks ability to surprise the market remains intact, even in these trying times. It…

Central banks' ability to surprise the market remains even in these trying times. It was the Bank of Japan's turn today. It surprised the market in two ways. First, it expanded its asset purchase plan by JPY10 trillion ($128 bln).…

Financial news for 14 February 2012

We stress again that the loss of AAA is not the end of the world, and one could make the case that AA is indeed the new AAA. However, the Moody’s news comes a time when markets are nervous about Greece, and so some limited fallout to the…

Polls suggest that in the first round of balloting in late April, Sarkozy is trailing his Socialist challenger Hollande 31%-24.5%. Marina Le Pen's candidacy appears sufficiently strong to deny either candidate a majority in the first round.