Here's my summary of the key news overnight in 90 seconds at 9 am, including news fears about Europe's debt crisis are re-emerging after divisions were laid bare again over the weekend about how to form a single Eurozone banking union.
Germany and France disagreed about the timetable for a single banking union and there were also doubts about the need for Europe to bail out Spain and Italy. See more here at Bloomberg.
Financial markets want news of a bailout for Spain sooner rather than later so the European Central Bank can unleash its 'Big Bazooka' of unlimited bond buying after a country asks for a bailout. However, German Finance Minister Wolfgang Schauble muddied the waters after he said Spain did not necessarily need a bailout.
Elsewhere, Portugal is abandoning plans to increase its social security tax from 11% to 18% after a popular revolt last week saw hundreds of thousands of citizens stage marches throughout the country. The tax increase was required as part of austerity plans required for Portugal's bailout programme. See more here at The Guardian.
Also, Greece is struggling to come up with 11.5 billion euros of cuts required for its next bailout. It is now in its 5th year of depression with unemployment over 25% and the main anti-bailout and anti-Euro party Syriza is now ahead in opinion polls.
The 'troika' of donors negotiating Greece's next bailout say they have found a 20 billion euro hold in Greece's budget plans.
All of this uncertainty about Europe, along with worries about growth in China and America, makes our currency look more attractive, as does unlimited money printing by central banks in the Northern Hemisphere. The euro fell last week for the first week in six weeks after figures showed the Eurozone economy weakening.
The New Zealand dollar is near a one year high on a Trade Weighted Index basis of around 73.7 after it was firm at 82.8 USc and 51 pence over the weekend. It also rose to 63.9 euro cents and is over 79.4 Australian cents.
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(Updated with details and links)
19 Comments
Interesting....31% of houses under-water, and that includes texas....oh dear Hugh....pretty free to build in texas you say....still 31% paid too much....
Some Boston , new york 22%.....wonder what the building regs are there.
I dont agree that its Fed's policy to apply sierfdom, very 1984...
regards
I think if they helped pay home-owners mortgages then the banks wouldn't be insolvent with all the bad debt on their balance sheet i.e. two birds, one stone. If they give the banks money to buy bad debts off their balance sheets, you've still got all the home owners that are broke. If you are going to give money, QE, bottom up works a lot better than top down. Simple math.
Changing the subject a tad, anyone else catch that tv item on the poms building an eco tire house in France. Been on a few times...actually many times cos it's on Sky!...well for the first tiem I caught the statement that in France there are no little Hitlers making up rules to stipulate how you may build your own home...not in France oh no...no rules at all...be it on your own head if you build a pile of rubbish...no bailouts is my guess...no insurance either...
Now why couldn't this be the case in Noddyland!
Interesting News out of OZ.
Chinas soverign wealth fund is seeking to invest in Australias largest dairying operation.
http://www.smh.com.au/business/china-seeking-stake-in-australian-dairy-…
The most interesting part is the VDL company is owned by the Taranaki District council.
Its been plagued with problems, was owned by Armor and Co and then fliked to the New Plymouth council, just in time. I would imagine the council are motivated vendors.
They have a history of welfare problems, used to be when you searched all you got was court dates etc, now they have been reborn and a google search reveils nothing, whiter than white.
http://www.stuff.co.nz/taranaki-daily-news/news/7033397/Aussie-dairy-fi…
Look at what the super fund is up to. I think I know who's going to end up with the money
http://www.stuff.co.nz/business/industries/7721138/Super-fund-wants-to-…
Love to know what is really went on on here, I dont think we will ever know now.
http://www.stuff.co.nz/business/industries/7716822/Coolstore-receivers-…
Yes I heard the same Andrew, not dissimiliar to the Crafer model in philosophy and outcome. Maybe it has changed with the council ownership.
Is the Chinese investment firm motivated by a solid investment underpinned by 'food security', or is it identifying a weakj corporate model which can be gainfully improved?
The European situation will fester on indefinetely until they unwind the common currency and allow the different ecconomies to rebalance. In the meantime they seem prepared to throw good money after bad rather than admit their monumental error in setting it up in the first place. The only other logical end point is that Germany will have to take control of the whole of Europe and all Europeans adopt the German work ethic and culture. Like that is going to ever happen!!
More correctly Bernard , Germany and France disagree on the timetable untill they can agree on the stucture of Goverance at the ECB....so far , Merkel has been restrained while looking irritated.
Wolfgang Scruples doesn't much care to give away to much power to the Draghi or ,who could potentially succeed him, without setting in stone Germany's control over that process.
Guess you'd have to ask yourself , who's cheque book is really being counterfieted here anyway....?
She really needs to rock up to the podium, give them the old Hiel salute , and tell them straight, the Forth Reich has arrived .......by stealth,maybe,... but nontheless here we are.!
So it's a bit early...who cares...Spain is heading toward a shattering civil war...remember the last one!
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